Even though you do not maintain an inventory, you can use that section of the Schedule C to report the cost of your goods sold. Go to the inventory section and enter your beginning and ending inventory as '0'. Then enter the cost of your goods ($42,000) in the Cost of Purchases box.
Otherwise, you can either claim the cost of the goods you sold as an expense in the Supplies category or in the Miscellaneous Business Expense category where you can enter your own description and amount.
No matter which method you choose, the end result should be the same.
@Anonymous
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