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By allowing her to take the dependency she received an additional deduction of $3,100. She may also have claimed the child tax credit ($1,000) if the child was under the age of 17 at the end of 2004. Also, if that was her only dependent she may have also claimed head of household status which allows her to use a more favorable tax rate schedule. The value of the dependent exemption to her is dependent on her tax situation and her effective marginal tax rates.
The best way to calculate the value is to have her compute her tax liability (Federal & state) without the dependent exemption. For example: A single person with $30,000 in wages who deducts the standard deduction would have fed & state tax liabilities of about $3,800 for 2004. That same person with a child under 17 who claims head of household status would have a fed & state liability of about $1,800. A $2,000 savings.
A better way to approach this is to calculate the additional tax liability YOU had to pay by giving up the dependent exemption. Just a thought.