- 88 -
6/30/78 6/30/79
Profit/Loss (6 months) 2,916,478.65 3,650,217.86
Gross income 1,824,034.25 2,485,250.27
Operating expenses 1,092,444.40 1,164,967.59
Operating income 542,291.04 740,191.69
Overhead expense 550,153.36 424,775.90
Income before acquisition 98,806.00 89,178.98
Acquisition expense 451,347.36 335,596.92
Net income
Around the end of 1979 or early 1980, Schnitzer discussed
the sale of Schnitzer-PMS to Minneapolis Honeywell for a price
between $12 million and $13 million. Honeywell, however, decided
not to purchase Schnitzer-PMS.
In 1989, IRA accepted a reduced final payment for early
payment of the balance due on the sale of the stock.
IRA received the following payments of principal and
interest and reported the following gain on the installment sale
of the Schnitzer-PMS stock:
Year Payment Principal Interest Gain
1979 $150,000 $150,000 -- $142,740
1980 533,425 211,468 $321,957 201,233
1981 534,696 309,308 225,388 294,338
1982 361,692 172,441 189,251 164,094
1983 361,692 186,655 175,037 177,621
1984 361,692 202,042 159,650 192,263
1985 361,692 218,696 142,996 208,111
1986 361,692 236,724 124,968 225,266
1987 361,692 256,217 105,475 243,816
1988 361,692 277,360 84,332 263,936
1989 840,423 822,841 17,582 783,016
Total 4,590,388 3,043,752 1,546,636 2,896,434
E. The Eulich Arrangement: Essex Hotel Management Co.
1. Eulich's Background
For many years, Eulich had been a real estate developer of
office buildings, shopping malls, and warehouses in Houston and
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