CMA Consolidated, Inc. & Subsidiaries, Inc. - Page 62

                                       - 28 -                                         
               For 1996, CMACM claimed a $469,221 cost basis in its 25-               
          percent portion of the Jenrich note transferred to Lexington.  In           
          addition, CMACM claimed a $459,221 loss from its partial                    
          disposition of that note.  CMACM also deducted $414,041 for the             
          over lease rental payments that it reported as being paid to                
          Jenrich during 1996.  The $414,041 amount equaled the amount due            
          CMACM from Jenrich under the Jenrich installment note.                      
               8.  On September 1, 1997, CMACM transferred to Lexington the           
          remaining 75 percent of its interests and obligations under                 
          various agreements concerning the Shared end-user lease                     
          equipment.  Among other things, CMACM transferred:  (1) The                 
          remaining 75 percent of CMACM’s over lease rights in the Shared             
          equipment, and (2) 75 percent of that portion of the Jenrich note           
          attributable to the Shared equipment.  In exchange for CMACM’s              
          transfer, Lexington issued its $1,000 unsecured promissory note             
          to CMACM and assumed 75 percent of that portion of CMACM’s over             
          lease rental payment obligation to Jenrich attributable to the              
          Shared equipment.  Pursuant to the terms of the unsecured note,             
          Lexington promised to pay CMACM $1,000, plus 8 percent interest             
          on December 31, 2002.                                                       
               For 1997, CMACM claimed a $1,179,013 basis in the 75-percent           
          portion of the Jenrich note it transferred to Lexington and a               
          $1,178,013 loss from the partial disposition of the note.  CMACM            








Page:  Previous  18  19  20  21  22  23  24  25  26  27  28  29  30  31  32  33  34  35  36  37  Next

Last modified: May 25, 2011