- 54 -
In the notice of deficiency for 1977 respondent determined
that there was unreported income equivalent to all commissions
attributed to Diesel Power on the CTC receipts journal,
$17,878.24 of which was received from GM; and that petitioner had
unreported commission income from "D.D.A."--a division of GM--in
the amount of $94,743.27. During 1977 the CTC receipts journal
shows receipt from GM of the total amount of $24,134.01. Of this
amount $6,255.77 was recorded in the CTC receipts journal as CTC
commissions; $17,878.24 was recorded as Diesel Power commissions.
All but $7.93 of this total amount was deposited to the CTC CNB
account. Furthermore, in December 1977, CTC received additional
payments from GM in the total amount of $94,742.66. These
payments were deposited in the CTC CNB account and were recorded
on CTC's 1977 cash receipts journal as "Refunds/Reimbursements".
G. SEDCO/IMICO
Prior to 1973 CTC had sold equipment for one of its other
customers to SEDCO International, S.A. (SEDCO) and to a related
company called IMICO.
During 1973 petitioner entered into a joint venture with a
company called Stewart & Stevenson Services, Inc. (Stewart &
Stevenson). Under this agreement, a stock of spare parts would
be placed at a location in Iran for resale to SEDCO, IMICO, or
any other customer in the Middle East. The parts were to be
owned by the joint venture until sold. Payments for these parts
Page: Previous 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 NextLast modified: May 25, 2011