John F. Moran - Page 9

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          check payable to petitioner.  After receiving the initial check,            
          petitioner requested that Mr. Kapusta issue the remaining                   
          reimbursement checks payable to Clairol, which was a supplier of            
          beauty products.  The payments made by Mr. Kapusta to reimburse             
          petitioner and Ms. McNamara for the renovations to the beauty               
          shop were as follows:                                                       

                Check No.     Date     Amount     Payee      Description              
                1170       3/11/89  $500       Petitioner First                       
                                                            installment               
                1241       5/26/89 3,000       Clairol      * * * products            
                1354       Aug. 1989 1,500     Clairol      Supplies                  
                1402       Sept. 1989 2,500    Clairol         --                     
                1247       11/22/89 2,000      Clairol      Supplies                  
                1509       12/20/89 2,000      Clairol      Supplies                  
                1551       1/24/90 2,000       Clairol      Supplies                  
                1589       2/22/90 2,000       Clairol      Supplies                  
                1620       Mar. 1990 2,000     Clairol      Supplies                  
                1839       9/18/90 6,000       Clairol      Supplies                  
                1883       Oct. 1990 2,000     Clairol      Supplies                  
                1933       Dec. 1990 2,000     Clairol      Supplies                  
               The proceeds from these checks issued to petitioner or                 
          Clairol were deposited in petitioner and Ms. McNamara’s personal            
          joint checking account at Continental Bank.  The proceeds from              
          these checks were not recorded as income on the corporation’s               
          books and records or reported as income on any of the                       
          corporation’s, or of petitioner and Ms. McNamara’s, Federal                 






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