- 18 -
each day and the last transaction number on the cash register
tape for the previous day, and the nonresettable grand total
according to the Z reading.20 That summary also showed the
difference that Mr. Phielix had calculated between the grand
total according to the Z reading for each day that was displayed
on each of those tapes and the grand total according to the Z
reading for the previous day that was displayed on each of those
tapes. (Hereinafter, we shall sometimes refer to that difference
as the Z reading difference in grand totals.21) Mr. Phielix
transferred the information for 1987 through 1990 that was
contained in his handwritten summary (with certain changes22)
20 If the cash register tape that Mr. Katerelos saved contained
two Z readings, Mr. Phielix used the data displayed by the second
Z reading when he created his handwritten summary.
21 The Z reading difference in grand totals included a differ-
ence in grand totals according to the Z readings on the cash
register tapes that Mr. Katerelos saved where, because Mr.
Phielix was unable to read the respective grand total displayed
on those tapes for certain days during the years at issue, he
used the grand total that was legibly displayed on the cash
register tape that Mr. Katerelos saved for the day next succeed-
ing the day for which the cash register tape that Mr. Katerelos
saved did not legibly display a grand total. Under this ap-
proach, instead of calculating the Z reading difference in grand
totals for a two-day period, Mr. Phielix computed the Z reading
difference in grand totals for a period consisting of more than
two days.
22 Mr. Phielix did not transfer into the computer the informa-
tion for 1991 that was contained in his handwritten summary.
That was because the amount of additional tax that Mr. Phielix
had calculated that petitioners owed for that year as a result of
the underreporting of NDV's gross receipts for that year appeared
to him to be de minimis. Respondent did not determine in the
notice of deficiency (notice) that petitioners were liable under
(continued...)
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