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1979
Although IRA acquired 100 shares (100 percent) of KWJ Corp.
in November 1978, IRA first included KWJ Corp. on its 1979
consolidated return.24 During 1979, IRA sold its Schnitzer-PMS
stock back to Century Development. Schaffel's payments to IRA
began in 1979. Frey's arrangement began in 1979 and, in December
1979, IRA acquired 1,000 shares of Zeus Ventures, Inc. (Zeus).
IRA's consolidated return for 1979 reported a consolidated
net loss of $20,728, a net loss for Cedilla Investment Co. of
$320,425, and net taxable income from KWJ Corp. of $119,646 and
reflects the following income and end-of-year balance sheets with
respect to IRA and Cedilla Co. (unconsolidated):
24
IRA's 1978 return reported $1,442,930 total assets as of the
close of the year, $34,024 of which was the amount of its
investment in subsidiaries. The 1979 return reported $1,592,930
of total assets as of the beginning of the year, $184,024 of
which was the amount of its investment in subsidiaries. The
$150,000 difference is the amount IRA agreed to pay for the KWJ
Corp. stock.
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