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(8) whether the employee and employer dealt at arm's length, and
if not, whether an independent investor would have approved the
compensation; (9) the employer's compensation policy for all
employees; (10) the prevailing rates of compensation for
comparable positions in comparable companies; (11) compensation
paid in prior years; and (12) whether the employee guaranteed the
employer's debt. Rutter v. Commissioner, 853 F.2d 1267, 1271
(5th Cir. 1988), affg. T.C. Memo. 1986-407; Owensby & Kritikos,
Inc. v. Commissioner, 819 F.2d 1315, 1322-1323 (5th Cir. 1987),
affg. T.C. Memo. 1985-267; Pepsi-Cola Bottling Co. of Salina,
Inc. v. Commissioner, 528 F.2d 176, 179 (10th Cir. 1975), affg.
61 T.C. 564 (1974); Mayson Manufacturing Co. v. Commissioner, 178
F.2d 115, 119 (6th Cir. 1949), revg. and remanding a Memorandum
Opinion of this Court dated Nov. 16, 1948; R.J. Nicoll Co. v.
Commissioner, 59 T.C. 37, 51 (1972). No single factor controls.
Mayson Manufacturing Co. v. Commissioner, supra.
Both parties called experts to testify about whether
compensation paid to Eberl was reasonable. Petitioner's expert
was Albert S. Williams (Williams), and respondent's was James F.
Carey (Carey).
We next apply the factors listed above in deciding whether
compensation petitioner paid to Eberl was reasonable.
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