Frank's Casing Crew and Rental Tools, Inc. - Page 5

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          from a strict application of an accrual method.  Petitioner                 
          argues that respondent cannot challenge its method of accounting            
          for yearend sales and services because it has used this method              
          consistently in prior years that were audited by respondent                 
          without relevant change.                                                    
               Turning first to the parties' dispute over the all events              
          test, a taxpayer recognizes income under an accrual method when             
          all events have occurred that fix the right to receive the                  
          income, and the amount thereof can be determined with reasonable            
          accuracy.  Secs. 1.446-1(c)(1)(ii), 1.451-1(a), Income Tax Regs.;           
          see also United States v. Anderson, 269 U.S. 422 (1926);                    
          Hallmark Cards, Inc. v. Commissioner, 90 T.C. 26, 32 (1988).                
          It is the right to receive an item of income, rather than its               
          actual receipt, that controls when the item is includable in the            
          gross income of an accrual method taxpayer.  When the right to              
          receive a set amount of income becomes fixed, the income                    
          ordinarily accrues.  Spring City Foundry Co. v. Commissioner,               
          292 U.S. 182, 184 (1934); Resale Mobile Homes, Inc. v.                      
          Commissioner, 91 T.C. 1085, 1093 (1988), affd. 965 F.2d 818 (10th           
          Cir. 1992).                                                                 
               Petitioner claims that its right to receive income on a                
          yearend sale or service is not fixed for purposes of the all                
          events test until it sends the fully documented invoice to its              
          customer.  It was not an abuse of discretion for respondent to              
          reach the opposite conclusion.  By the end of each year in issue,           

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