- 570 -
Hargens or to collect on the note, nor was any persuasive
evidence presented to show that this note became worthless in
1987.
With respect to the note receivable from Cedilla Invest.,
Kanter testified that "It had no assets, as best I recall, that
could be assessed effectively to recoup this note". This
statement is not sufficient evidence to establish that the
alleged note became worthless in 1987. It lacks any foundation
in Kanter's personal knowledge of Cedilla Invest.'s assets. In
addition, the balance sheets of Cedilla Invest. included in IRA's
1986 to 1989 tax returns show that Cedilla Invest. had total
assets of $10,008,632, $526,374, $526,374, and $575,896 at
December 31, 1986, 1987, 1988, and 1989, respectively. IRA
presented no evidence that the fair market value of these assets
was less than the liabilities of Cedilla Invest. IRA's returns
also show that Cedilla Invest. earned total income in the amounts
of $443,762, $52,656, and $11,702 for 1987, 1988, and 1989,
respectively. These returns indicate that Cedilla Invest. had
assets with which to pay the alleged note receivable, that
Cedilla Invest. continued to be a going concern after 1987, and,
therefore, that the Cedilla Invest. note had current liquidating
value or potential value.
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