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1990. Gross sales of a ready-mixed concrete operation during a
year are directly related to the yards of concrete the company
sells during that year. The number of tires used on the trucks
operated by a ready-mixed concrete business is dependent on the
distance the trucks are driven, which is related to the number of
yards of concrete sold, since the range for hauling of concrete
is limited by the time the concrete will remain useful after it
is placed in the truck. Generally, petitioner would not deliver
concrete to a location that was more than a 90-minute drive from
petitioner's plant. Kurt Caillier approved the bulk purchase of
tires.
On April 9, 1990, Gillette Tire submitted invoice No. 30088
to petitioner in the amount of $387,637.30 for 993 tires.
According to a Gillette Tire billing statement dated June 1,
1990, petitioner paid $129,212.43 on May 18, 1990, approximately
one-third of $387,637.30, to Gillette Tire. The billing
statement indicates that the payment was in reference to invoice
No. 30088. Petitioner's books and records indicate that this
payment to Gillette Tire was made with petitioner's check No.
4318.
According to petitioner's books and records, another payment
of $129,212.43 was made by petitioner with check No. 4369 on June
28, 1990, to Gillette Tire with respect to the April 9, 1990,
invoice. On June 30, 1990, an intercompany account between
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