Practice Set #2
James Bryant is 60 in 2023. He lives with his spouse at 1500 North Jamboree,
Tustin, CA 92782 (which was sold in 2023 see below). His Social Security number is 122-65-
2112. He married his wife Julie Bryant (Social Security Number 223-31-2222) in 2013 she is 55
in 2023. They purchased their Tustin home together right after their marriage on June 15, 2015.
Julie Bryant does not work. They adopted two twin newborns born on( 1)/(2)()/(2015.) Their names are
James Jr. and John Bryant. Their Social Security numbers are 232-90-8909 and 235-45-1987,
respectively.
James wholly owns Bryant Consulting LLC and provides engineering consulting services for
which he uses the cash method of accounting. James formed this business after he left his former
employer “ABC Engineering”. His revenues and expenses are:
Client revenue $1,250,000
Salary and Wage expenses (per W-2) All work from home 350,000
Software License Fees 120,000
Utilities 18,000
Telephone and Cell Phone 6,900
Business Insurance 10,500
Entertainment 20,500
Contributions to Trump Campaign 15,000
Meals 30,000
Depreciation (1) 50,000
Health insurance (2) 75,000
Accounting and legal fees (3) 55,000
Employee Benefits (including contributions to the employee profit-
sharing plan and matching to 401k)
35,000
(1) Assume Section 179 will be taken for this new equipment
and placed in service on January 15, 2023
(2) $50,000 for employees’ insurance and 25,000 for health and
dental for James and Julie and their children.
(3) The $55,000 includes legal expenses of $25,000 related to
the purchase of another engineering consulting firm and
$20,000 to purchase into an unrelated business that was not
successful. The remaining $10,000 were accounting fees for
bookkeeping and tax return preparation.
Other income for James and Julie includes the following:
Dividend Inc.: Box 1 a 1099 DIV $40,500
ABC, Inc. Held for 30 days $30,000
Dickerson, Inc held for 110 days 10,500
Interest income:
US Bank 5,000
Wells Fargo Bank 5,500
City of Tustin bonds 30,000
Treasury Bills 10,000
During the year, James and Julie also had the following transactions: