Part 2 of question , please read Part 1 , 2 & 3 to answer question

In March 2019, Bruce decided to start his own business; a retail bicycle shop to be located in NYC near Central Park called Bruces Bikes. On April 20, 2019, Bruce signed a 10-year lease at a monthly rental rate of $10,000, effective May 01, 2019, for retail space on 110^th Street and CPW. The lease provided that Bruce was responsible for the costs of improving the retail space for its intended use. The terms of the lease also provided that the first three months were rent-free so that Bruce could complete the construction needed to operate a retail bike shop. When Bruce executed the lease he paid the landlord $30,000 as a security deposit. On May 01, 2019, Bruce paid a contractor $225,000 to provide all construction work relating to the build-out, which included electrical, plumbing, and carpentry. On June 01, 2019, Bruce purchased the following assets for the business:

Equipment $ 35,000

Furniture & Fixtures $ 10,000

Computer Equipment $ 12,500

Although Bruce planned on a grand opening on July 01, 2019, the construction was not completed until July 21, 2019, causing Bruce to delay the grand opening until August 01, 2019.

On August 01, 2019, Bruce purchased a new truck for $32,500, which weighs 9,500 pounds, to be used 100% in the business for pickups and deliveries. Bruce planned to finance the new business with the $125,000 inheritance he received on 03/01/2019, from his late fathers estate. Bruce also planned to use $50,000 of savings he had invested with Madoff Investment Securities (MIS) but learned on 3/29/2019, that his entire savings was lost as a result of a massive ponzi scheme. In order to come up with the additional funds needed to finance the construction, equipment, and inventory, Bruces grandfather loaned him $75,000 on 05/15/2019. On December 25, 2019, Bruce received a letter from his grandfather stating that he forgives the entire $75,000 loan effectively immediately. For 2019, the bike shop generated the following revenues and incurred the following expenses:

Sales, Rental, & Service Revenue $ 255,000.00

Inventory purchased 125,000.00

Inventory on hand at December 31, 2019 60,000.00

Rent from (August 01 December 31, 2019) 50,000.00

Salaries 35,000.00

Supplies 15,000.00

Utilities 12,000.00

Promotional expense 5,000.00

Travel to Trade Shows 1,000.00

Meals & Entertainment 1,100.00

Postage and Delivery 1,000.00

Telephone 1,200.00

Attorney fees 2,500.00

Pre-startup investigative expense 53,000.00