Inverworld, Inc., et al. - Page 199

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            letters of credit were collateralized by certificates of deposit                              
            that LTD had purchased with the client's funds.  The gross                                    
            receipts and direct costs relating to LTD’s "Income from Letters                              
            of Credit" for each taxable year are as follows:                                              
                        TYE June 30           Gross Receipts         Direct Costs                         
                        1987                      1$24,152          - 0 -                                 
                        1988                        91,556          - 0 -                                 
                        1989                        53,047          - 0 -                                 
                  1We have recategorized under "Income from Letters of Credit"                            
            for taxable year ended June 30, 1987, the amount of $24,152 of                                
            gross receipts, which was originally categorized under "Other                                 
            Income".                                                                                      
                        i.     Foreign Exchange Investments                                               
                  LTD derived income from its foreign exchange investments.                               
            The gross receipts and direct costs relating to LTD’s "Income                                 
            Foreign Exchange Invest" are as follows:                                                      
                        TYE June 30        Gross Receipts    Direct Costs                                 
                        1987               $8,425                   - 0 -                                 
                        j.     Treasury Bills                                                             
                  LTD earned commissions from third parties on the sale of                                
            U.S. Treasury bills to LTD’s clients.  For taxable year ended                                 
            June 30, 1989, LTD’s commissions were from Merrill Lynch.  LTD’s                              
            direct costs were the commissions that it paid to promoters.  The                             
            gross receipts and direct costs relating to LTD’s "Commissions -                              
            T-bills" for each taxable year are as follows:                                                








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