Marcelo E. Ferrada and Gloria D. Ferrada - Page 6

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          Lumina.  It is unclear from the record on what the remaining $311           
          was spent.                                                                  
               d.   Office Expense                                                    
               Petitioners deducted office expenses of $2,099.  Receipts              
          show that they purchased a computer on March 28, 1998, for                  
          $1,917.  Mr. Ferrada used it for his employment with Hi-Tec but             
          was not required by Hi-Tec to purchase it.  He also used the                
          computer for his flashlight and concession stand activities.                
               Petitioners also purchased a fax machine in January 1998,              
          for $144.99.  Mr. Ferrada purchased the fax machine to receive              
          orders for the concession stand he purchased in May 1998.                   
               e. Rent/Lease:  Vehicles, Machinery, Equipment                         
               Petitioners reported an expense of $11,180 which they                  
          classified as the rental or lease of vehicles, machinery, and               
          equipment.  Petitioners actually paid the $11,180 for the rental            
          of an apartment in Lake Charles.                                            
               f. Repairs and Maintenance                                             
               Petitioners deducted $1,460 for repairs and maintenance                
          which was performed on their vehicles.  Petitioners did not                 
          provide any documentation of these expenditures.                            
               g. Supplies                                                            
               Petitioners deducted $11,517 for supplies for their                    
          concession stand.  Petitioners did not provide any documentation            
          of these expenditures.                                                      






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