Northwestern Indiana Telephone Company - Page 84

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            income to Mr. Mussman in 1989.  They point out that in the notice                          
            of deficiency issued to the Mussmans, respondent failed to treat                           
            any portion of the $88,484 in payments as dividend income to Mr.                           
            Mussman in 1988.  They assert that the $75,432 of cellular                                 
            telephone investment account expenditures NITCO recorded includes                          
            $33,445.68 in payments made by NITCO in 1988.  Similarly, they                             
            assert that the $13,052 of other investment account expenditures                           
            NITCO recorded includes $9,562.42 in payments NITCO made in 1988.                          
            Respondent, on the other hand, disputes that any of the $88,484                            
            in expenditures was made by NITCO during 1988.                                             
                  The record does not support petitioners' claim that the                              
            $88,484 in expenditures includes cellular telephone expenditures                           
            that were made by NITCO during 1988, rather than during 1989.  In                          
            the Schedule B-8 to the 1989 annual report it filed with the                               
            IURC, NITCO reported that it had $75,342 of "deferred cellular                             
            charges" and $13,052 of deferred "other" charges.  Yet, in the                             
            Schedule B-8 to the 1988 annual report it filed with the IURC,                             
            NITCO reported that it had $390,000 of "extraordinary                                      
            retirements" and $39,599 of deferred "other" charges.  The                                 
            Schedule B-8 to the 1988 report reflected no "deferred cellular                            
            charges" for 1988.  We conclude that petitioners have failed to                            
            establish that the $88,484 in expenditures includes payments that                          
            were made by NITCO in 1988.                                                                
                  At pages 39-40, supra, of our findings, we have attempted to                         
            allocate and attribute the $88,484 of expenditures to specific                             
            matters as best as we can on the record presented.  We                                     



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