Shigenori Kudo and Motomi Kudo, et al. - Page 47

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               On the basis of the foregoing, we conclude that unexplained            
          bank deposits in the following amounts constitute unreported                
          taxable income to the Takaos for the following years:                       
          1988       1989      1990       1991                                        
          Unexplained deposits                                                        
          in issue             $110,644   $61,800   $114,934   $37,277                
          Less:                                                                       
          Money from parents      3,600     3,600      3,600     3,600                
          Check from Nakamura       --       --         --      32,000                
          Unreported income                                                           
          from deposits        107,044    58,200    111,334     1,677                 
               Cash Purchases                                                         
               On November 23, 1988, Akiko used $9,000 cash to purchase a             
          cashier's check.  On February 1, 1989, Yoshinori used $55,320               
          cash to purchase a Mercedes Benz.  On April 19, 1989, Akiko used            
          $3,000 cash to purchase a traveler's check.  Respondent contends            
          that the source of the cash to make those purchases for 1988 and            
          1989 was unreported income.  Petitioners contend that the Takaos            
          used cash from Akiko's cash hoard to make the cash purchases.               
               Both Yoshinori and Nakamura testified that the cash for the            
          purchase of the Mercedes Benz came from Akiko's cash hoard.  As             
          we discussed above, although we do not doubt that Akiko                     
          maintained a cash hoard, the record does not establish the amount           
          of cash on hand as of the beginning of the years in issue, or the           
          amount that Akiko used from funds accumulated before that time.             
          Nevertheless, on the basis of the testimony relating to the                 
          purchase of the Mercedes Benz, we believe that at least some                
          portion of the cash for the automobile came from cash accumulated           




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