Hank started a new business, Hank's Donut World $($HW for short$),$ in June of last year. He has requested your advice on the following specific tax matters associated with HW$\text{'}$s first year of operations. Hank has estimated HW$\text{'}$s income for the first year as follows:

Revenue:

Donut sales $ $252,000$

Catering revenues $71,550$ $ $323,550$

Expenditures:

Donut supplies $ $124,240$

Catering expense $27,910$

Salaries to shop employees $52,500$

Rent expense $40,050$

Accident insurance premiums $8,400$

Other business expenditures $6$