Alpha Medical, Inc., f.k.a. Alpha Medical Management, Inc. - Page 19

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          included locations in the States of Tennessee, Kentucky,                    
          Arkansas, and Mississippi.  Moreover, approximately 30 percent of           
          the increase in client locations occurred from 1989 to 1990.                
          Finally, the home health care visits managed by petitioner in               
          1990 almost doubled from the 500,000 managed in 1989.  Thus,                
          petitioner's business dramatically increased in 1990 compared to            
          1989.                                                                       
               Petitioner is in a complex business.  The management of the            
          home health care business requires special expertise with regard            
          to Medicare, Medicaid, insurance requirements, and State health             
          care licensing regulations.  In addition to technical expertise,            
          compliance with the various insurance programs requires accurate            
          documentation of each home visit.  Petitioner managed the                   
          documentation and reporting of almost a million home health care            
          visits in 1990.  The documentation and reporting of these visits            
          included both clinical information and claims information which             
          were processed through the Alpha Information System that was                
          designed in part by Rogers and Worley and implemented by Rogers.            
          This factor favors petitioner.                                              
               4.  Comparison of Salaries Paid to Gross and Net Income                
               In 1990, Rogers' compensation was 44.9 percent of                      
          petitioner's gross receipts and 64.6 percent of its net taxable             








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