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the officer compensation and gross revenue of these firms with
that of petitioner, we do not know how much the officers of
these other firms contributed to the success of their
businesses, the percentage of escrows they solicited and
handled, or the hours they worked. Thus, any comparison would
be of limited assistance in our evaluation of the value of
Kleindienst's services.
Petitioner argued that we should assign $220,000 as
compensation for Kleindienst's administrative services, rather
than the arbitrary $12,000 assigned by Brooks and Haas because
Brooks' firm paid $220,000 to its corporate officers. We agree
that Brooks and Haas arbitrarily allocated $12,000 for
Kleindienst's compensation as an executive and manager.
However, $220,000 compensation would be too high. Brooks' firm
generated more than two times the gross revenues of petitioner.
Also, the officers' compensation at Brooks' firm included
payment for soliciting about 25 percent of the firm's escrow
clients, which generated over $750,000 in revenue. Petitioner,
however, argues that Kleindienst should receive compensation for
soliciting clients in addition to her compensation for her
administrative duties. Because of these differences, we find
that the amount of officer compensation paid by Brooks' firm
does not support equivalent compensation for Kleindienst's
executive responsibilities.
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