Question

Jill owns a salon and she submit a PPP loan application . Jill is a sole proprietorship with no employees. Jill submit her 2019 IRS Form and schedule C her Gross sales were $36,000 and her net profit loss was $12,000. What is the maximum possible PPP loan amount ?

Answer 1

Answer:

Jill's maximum possible PPP loan amount is $2,500

Step-by-step explanation:

The given parameters of the PPP loan application applied to by Jill is as follows;

Jill submits her 2019 IRS Form Schedule C with Gross Sales = $36,000

The net profit loss = $12,000

Therefore, Jill's monthly average net profit = $12,000 ÷ 12 = $1,000

Jill's PPP loan amount = 2.5 × Her monthly net profit

∴ Jill's maximum possible PPP loan amount = 2.5 × $1,000 = $2,500

Jill's maximum possible PPP loan amount = $2,500