- 10 -
Y. Ling, P.C., created this depreciation schedule from a list of
equipment prepared by Mr. Kong. Mr. Kong’s list showed that Sam
Kong Fashions purchased the following pieces of equipment:11
No. of Purchase price
Equipment machines per machine
Button machine 1 $2,300
Pocket opener Unknown 6,500
machine
Two needles 1 2,000
sewing machine
Twelve needles 1 2,900
sewing machine
Sewing equipment 2 1,900
During the taxable years of 1994 and 1995, Sam Kong Fashions
employed 10 to 20 full- and part-time employees. Sam Kong
Fashions paid some employees partially by check and partially in
cash. An employee of the corporation, Bi Ling Wu, received cash
11 On brief, petitioners assert that Mr. Kong or Sam Kong
Fashions purchased the following equipment:
No. of Total
Equipment machines purchase price
Button machines 2 $2,008 ea.
Sewing machines 22-23 1,800 ea.
Other machines 3 2,300 ea.
Other machines 6-7 1,900 ea.
New button 2 2,100
machines
Used button 1 1,500 ea.
machine
Petitioners argue that they are entitled to additional
depreciation deductions of $14,263 and $22,821 in 1994 and 1995,
respectively.
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