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Avery has always wanted to own their own business. Last year,
they took the leap and opened a pet store in a nearby city. They
lease the store. They incurred start-up costs and large inventory
costs for buying food in bulk. They had to purchase three large
tables and a machine that moves the food to higher shelves for
storage. They even hired five people: a groomer, two clerks, a
stock person, and a bookkeeper. Unfortunately, the bookkeeper
has accounting experience but no tax experience. Now, they are
lost.
How do they handle the start-up costs? What kinds of assets can
they depreciate?
What kinds of records should they keep?

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  • 1. Avery has always wanted to own their own business. Last year, they took the leap and opened a pet store in a nearby city. They lease the store. They incurred start-up costs and large inventory costs for buying food in bulk. They had to purchase three large tables and a machine that moves the food to higher shelves for storage. They even hired five people: a groomer, two clerks, a stock person, and a bookkeeper. Unfortunately, the bookkeeper has accounting experience but no tax experience. Now, they are lost. How do they handle the start-up costs? What kinds of assets can they depreciate? What kinds of records should they keep?