James Jones is the owner of a small retail business operated as a sole proprietorship. During 2017, his business recorded the following items of income and expense. Revenue from inventory sales Cost of goods sold Business license tax Rent on retail space Supplies Wages paid to employees Payroll taxes Utilities $147,000 33,500 2,400 42,000 15,000 22,000 1,700 3,600 Compute taxable income attributable to the sole proprietorship by completing Schedule C to be included in James's 2017 Form 1040. Compute self-employment tax payable on the earnings of James's sole proprietorship by completing a 2017 Schedule SE, Form 1040. Assume your answers to parts a and b are the same for 2018. Further assume that James's business is not a service business, and that it has $155,000 unadjusted basis in tangible depreciable property. Calculate James's 2018 Section 199A deduction.
James Jones is the owner of a small retail business operated as a sole proprietorship. During 2017, his business recorded the following items of income and expense. Revenue from inventory sales Cost of goods sold Business license tax Rent on retail space Supplies Wages paid to employees Payroll taxes Utilities $147,000 33,500 2,400 42,000 15,000 22,000 1,700 3,600 Compute taxable income attributable to the sole proprietorship by completing Schedule C to be included in James's 2017 Form 1040. Compute self-employment tax payable on the earnings of James's sole proprietorship by completing a 2017 Schedule SE, Form 1040. Assume your answers to parts a and b are the same for 2018. Further assume that James's business is not a service business, and that it has $155,000 unadjusted basis in tangible depreciable property. Calculate James's 2018 Section 199A deduction.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:James Jones is the owner of a small retail business operated as a sole proprietorship. During 2017, his business recorded
the following items of income and expense.
Revenue from inventory sales
Cost of goods sold
Business license tax
Rent on retail space
Supplies
Wages paid to employees
Payroll taxes
Utilities
$147,000
33,500
2,400
42,000
15,000
22,000
1,700
3,600
Compute taxable income attributable to the sole proprietorship by completing Schedule C to be included in James's 2017
Form 1040.
Compute self-employment tax payable on the earnings of James's sole proprietorship by completing a 2017 Schedule SE,
Form 1040.
Assume your answers to parts a and b are the same for 2018. Further assume that James's business is not a service
business, and that it has $155,000 unadjusted basis in tangible depreciable property. Calculate James's 2018 Section 199A
deduction.
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