- 110 -
B. Cost of Goods Sold for 1977
For the year 1977 petitioner's total cost of goods sold was
$525,714.36. Galion was the principal payee, but others were
listed as GMOO, GMODC, Clark, and Cantwell. Petitioner claimed
cost of goods sold on his Schedule C for 1977 in the total amount
of $594,530. Therefore, cost of goods sold for 1977 was
overstated by $68,815.64.
C. Cost of Goods Sold for 1978, 1979, and 1981
For the years 1978, 1979, and 1981 respondent increased
petitioner's deductions for cost of goods sold in the amounts of
$148,706, $95,633.60 and $5,862, respectively, because they were
related to additional income respondent determined that
petitioner received from Galion. Having found that petitioner's
taxable income should be increased by the amounts received from
Galion, respondent correctly increased petitioner's cost of goods
sold for those years.
D. Claimed Deductions for Commission Expenses
Hillary Wood resided in Paris, France, during the 1970's.
The only service provided by Ms. Wood to petitioner was to
introduce him to Minister of Court Alam. Petitioner met Ms. Wood
only once at a dinner party at which she accompanied an employee
of Continental Oil. Petitioner made payments to Hillary Wood in
the amounts of $1,503.42, $18,041.04, $18,042.24, $18,043.44, and
Page: Previous 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 NextLast modified: May 25, 2011