- 3 -
During the year in issue, petitioner's stockholders were:
Oscar Campos, Sr., president; Oscar Campos, Jr. (Mr. Campos, Sr.'s
son), vice president for sales; and Elisa C. Martinelli (Mr.
Campos, Sr.'s wife), treasurer.
Petitioner acquires perfumes from numerous suppliers,
including Aeroboutique, S.A. (ASA), of San Juan, Puerto Rico.
Between July 1, 1989, and June 30, 1990, ASA sent petitioner
merchandise valued at $2,031,778. After examining the delivered
merchandise, Messrs. Campos, Jr. and Sr., telephoned Edgar Balzac,
the owner of ASA, threatening to return the merchandise to ASA
because the goods were at the end of their useful shelf life and
therefore unacceptable. Following further discussion, Messrs.
Balzac, Campos, Jr., and Campos, Sr., agreed that in lieu of
returning the merchandise, petitioner would keep the perfume on
consignment and would pay ASA only for the merchandise that it was
able to sell.
By June 30, 1990, CPI was only able to sell approximately
$100,000 of the merchandise received from ASA. (This amount was
properly included in income for the year.) Inasmuch as the
majority of the goods could not be sold, a decision was made to
attempt to sell the merchandise the following Christmas season.
The consigned merchandise remained in boxes on the racks in
petitioner's warehouse.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Next
Last modified: May 25, 2011