Thomas A. Johnson - Page 9

          from a second ticket agent with check No. 1083 in the amount of             
          $3,000.  We agree, and we find that the $5,500 is allowable as              
          cost of goods sold.                                                         
               Petitioner estimated that he purchased tickets for                     
          Ticketline with $3,130 of automatic teller machine (ATM)                    
          withdrawals from the Todge Trust account.  The $3,130 of ATM                
          withdrawals from the Todge Trust account consists of                        
          approximately 17 withdrawals, none of which exceeds $300.                   
          Petitioner has not shown that the $3,130 in ATM withdrawals was             
          for the purchase of tickets and not for personal expenditures.              
          Petitioner argues that several items labeled "debit memo" on his            
          bank statements represent either deductible expenses or cash                
          withdrawals used for the purchase of tickets.  The record does              
          not support petitioner's argument.  Petitioner provided the bank            
          statements showing the "debit memo" notations.  On brief,                   
          petitioner has attempted to explain the "debit memo" items, but             
          factual representations on brief are not evidence.  We sustain              
          respondent's determination as to these items.                               
               Based on the above findings, we conclude that petitioner has           
          substantiated cost of goods sold for the Ticketline business in             
          the amount of $143,004, which consists of $69,700 from the                  
          Ticketline account, $13,300 from the Todge Trust account, $43,250           
          from the equity credit line, $5,000 from the ULC account, $6,254            
          of credit card purchases, and $5,500 of purchases directly from             
          ticket agents.                                                              

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