I would like to get help with my homework. How to fill a tax form c?

Tax Return: Schedule C - 100 points

Instructions:

Please complete the 2017 tax return for Modern Day Clothing, LLC, based upon the facts presented below. If required information is missing, use reasonable assumptions to fill in the gaps.Ignore any Alternative Minimum Tax (AMT) calculations or reporting.

Modern Day Clothing, LLC. (MD) is organized as a single member, Limited Liability Company in the state of North Carolina and is taxed as Schedule C with a calendar-year end.MD operates four small boutique clothing outlet stores (family clothing stores) in the North Carolina cities of Charlotte, Durham, Raleigh, and Winston-Salem.MD's address, employer identification number and date of organization are as follows:

Modern Day Clothing, LLC

1515 North Lincoln Highway

Charlotte, North Carolina 28201

EIN: 14-2953556

Date Organized - February 2, 2000

MD has been at the same address since inception.

MD is owned by the following member:

Jennifer Lyons

85 Shady Elm

Charlotte, North Carolina, 28201

SSN 524-31-3493

MD reported the following information for the year:

MD uses the accrual method of accounting.

MD made payments in the current year that required the filing of Forms 1099.All of those Forms 1099 were filed timely.

Additional information:

None of the expenses incurred by MD during the year relate to the production or carrying of the tax-exempt securities held in portfolio.The tax-exempt securities are maintained in a separate brokerage account distinct from other holdings.

MD maintains its inventory on the cost method.MD uses specific identification for its inventory and has never changed its inventory method.MD has never written down any subnormal goods.The rules of Section 263A (UNICAP) do not apply to MD.

MD leases all of its real property.

On July 1, 2016, MD purchased $640,000 of new equipment (5-year MACRS property) that it used to expand its Charlotte store.Not including the $640,000 of new additions during the year, MD's calculated regular and AMT tax depreciation for the current year is $275,000.MD desires to maximize its current year cost recovery deductions relating to the equipment additions.

During the current year, MD gave $32,000 in cash to the Red Cross to assist with hurricane disaster clean-up in the North Carolina area.

All of the accrued wage amounts on the balance sheet as of December 31, 2017 were paid on January 15, 2018.

The accrued bonus amounts on the balance sheets as of December 31, 2016 and 2017, respectively, were paid on July 1, 2017 and July 1, 2018, respectively.

As of December 31, 2016 and 2017, respectively, MD had accrued vacation on its books of $19,000 and $21,000.As of March 15, 2017 and March 15, 2018 respectively, MD had paid $3,000 and $9,000 of those accrued amounts.

Financial Statements (kept on a GAAP basis):

Modern Day Clothing, LLC

Balance Sheet

Assets:12/31/201612/31/2017

Cash$340,000$385,000

Accounts Receivable-Credit Cards205,000232,000

Accounts Receivable-Trade63,00058,000

Less: Allowance for Bad Debts(13,000)(11,500)

Inventory2,908,000 3,010,000

Tax-exempt Securities 100,000100,000

U.S. Treasury Bonds200,000200,000

Fixed Assets4,010,0004,650,000

Less: Acc. Depreciation (2,875,000) (3,055,000)

Land-Unimproved (tax and GAAP basis)250,0000

Prepaid Rent165,000168,000

Total Assets:$5,353,000 $5,880,700

Liabilities and Shareholders' Equity:

Accounts Payable99,00093,000

Accrued Employee Wages27,00031,000

Accrued Officer Bonuses110,000145,000

Accrued Employee Vacation19,000-21,000

Note Payable-First Bank of NC (Credit Line)536,000812,000

Note Payable-First Bank of Charlotte3,655,0003,139,750

Capital Stock1,0001,000

Additional paid-in Capital99,00099,000

Retained Earnings807,0001,538,950

Total Liabilities and Shareholders' Equity $5,353,000$5,880,700

Income Statement for the year ending December 31, 2017

ItemAmount

Income:

Gross Sales$8,936,500

Less: Returns(354,000)

Net Sales8,582,500

Cost of Goods Sold(4,910,500)

Gross Profit3,672,000

Gain on Sale of Unimproved Land600,000

Interest Income -Bank 3,750

Interest Income-U.S. Gov't6,000

Municipal Bond Interest Income 2,650

Total Income: 4,284,400

Expenses:

Employee Salaries754,000

Repairs and Maintenance12,600

Bad Debts22,000

Rent765,000

Payroll Taxes84,500

Licensing Fees10,750

Property Taxes12,500

Interest Expense175,500

Depreciation180,000

Office Supplies5,300

Employee Training13,750

Advertising58,500

Employee Benefit Programs133,000

Meals and Entertainment3,750

Travel8,500

Charitable Contribution32,000

Insurance18,000

Utilities243,000

Telephone142,000

Total Expenses:$2,745,450

Net Income (loss): $1,538,950