Mary T. King and Fatai O. King - Page 9




                                         - 9 -                                          
                                        Original Amended        Conceded                
                                        Return   Return  Brief  by Respondent           
             Expenses                                                                   
             Advertising                $500     $882    $96    $96.06                  
             Bad debts                  3,000    -–      -–     -–                      
             Car & truck expense        -–       2,132   2,132  -–                      
             Insurance                  1,300    1,000   382    -–                      
             Mortgage                   2,500    -–      -–     -–                      
             Legal & professional       2,000    800     800    -–                      
             Repairs & maintenance      10,000   7,399   11,800   1 50.00               
             Supplies                   7,000    1,684   2,467  -–                      
             Taxes & license            550      1,362   1,362  930.90                  
             Travel                     5,300    -–      -–     -–                      
             Meals & entertainment      1,600    -–      -–     -–                      
             Utilities                  1,000    -–      -–     -–                      
             Telephone                  -–       1,382   1,382  426.23                  
             Electricity                -–       450     450    400.45                  
             Independent contractors    -–       4,609   4,609  -–                      
             Bank charges               -–       518     950    233.10                  
             PA Lottery charges         -–       936     936    936.00                  
             PA Lottery shortage        --       10,561  10,561 -–                      
             United News debt paid/Septa tokens   -–956     956    956.25                  
             Cleaning                   -–       520     520    --                      
             Depreciation on steel plates-–       -–      -–     497.50                  
             & electrical system                                                        
             Depreciation on newsstand  -–       -–      -–      1,435.00               
                                                                                        
                                        34,750   35,191  39,403 5,961.49                
             1Permit fees                                                               

                  We discuss each of the business expenses claimed by                   
             petitioners at trial which, generally, are the same                        
             expenses claimed by petitioners on the Schedule C filed as                 
             part of their amended return.  Petitioners claimed a                       
             deduction for advertising expenses of $882 on their amended                
             return, but at trial they introduced into evidence only two                
             checks in the aggregate amount of $96.06 drawn to the order                
             of the Philadelphia Enquirer.  Respondent concedes that                    
             petitioners are entitled to deduct advertising expenses of                 
             $96.06.                                                                    
                  Petitioners claim car and truck expenses of $2,132.                   
             In his testimony, petitioner acknowledged that his family                  
             used only one car during 1993 and that they used the car                   






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