Sherry Hopson owns a retail family clothing store. Her store is located at 4321 Circle Drive, Houston, TX 77001. Her employer identification number is 95- 1234321 and her Social Security number is 123-45-6789. The income and expenses for the year are:
Gross sales..............................................$350,000
Returns and allowances.................................(4,500)
Net sales................................................$345,500
Expenses:
Beginning inventory (at cost) ........................$ 82,500
Add: purchases..........................................210,000
Cost of goods available for sale......................292,500
Less: ending inventory (at cost) .....................(71,000)
Cost of goods sold..................................................................$221,500
Rent........................................................................................9,000
Insurance..................................................................................1,500
Legal and accounting fees.................................................................900
Payroll...................................................................................38,000
Payroll taxes..............................................................................2,600
Utilities.....................................................................................1,850
Office supplies...............................................................................750
Advertising.................................................................................2,100
On June 1 of this year, Sherry purchased the following new assets for the store:
___________________________Depreciable Basis................Recovery Period
Heavy-duty truck.........................$31,000.............................5 years
Desk and file cabinets.......................2,000.............................7 years
Computer......................................6,000..............................5 years
The truck is not considered a passenger automobile for purposes of the luxury automobile limitations.
Required:
Assuming that all other assets are fully depreciated and Sherry does not make the election to expense or take bonus depreciation, complete her 2012 Schedule C and Form 4562 on pages 7-39 to 7-42. Make up any additional information you need to complete the schedule.