Brad Pitt, owner of a small car repair and engine service business, operates his business...
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Accounting
Brad Pitt, owner of a small car repair and engine service business, operates his business as a C corporation with a December 31 year-end. He has three employees, including himself. The following expenses, along with $565,000 of gross income, are reported in the corporations financial statements.
Employee 1 salary $ 28,000
Employee 2 salary 28,000
Brad Pitts salary 45,000
Building rent 24,000
New Machinery purchased for the year 100,000
Depreciation of machinery for the year 10,000
Insurance coverage for all assets in the business 5,000
Insurance coverage on Brad Pitts personal residence 3,000
Consulting Fees 5,000
Utilities 2,000
Taxes and Licenses 12,000
Fine paid to City 4,000
Advertising 3,000
Interest Expense 5,000
Charitable contributions 20,000
Political Contributions 27,000
Dues paid to Small Engine Repair Institute 1,000
Mileage on car for personal use 2,500
House Cleaning expenses on personal residence 1,000
Janitorial expense for business 5,000
Brad Pitt would like to know the amount of his deductible expenses for tax purposes.
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