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year petitioner declared the bonuses to the following year when
the bonuses were paid because it is a change in accounting method
under section 446(e). We hold that it must.
3. Whether petitioner's net recognized built-in gain was
more than 50 percent of its taxable income in the year in issue.
We hold that it was.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
A. Petitioner
Petitioner is a California corporation which was
incorporated on August 30, 1960. Its principal place of business
was in Orange County, California, when it filed the petition in
this case.
Petitioner manufactured and installed flashing, vents,
pipes, and light-gauge sheet metal for housing projects in
southern California. Ninety percent of petitioner's business was
sheet metal installation, and 10 percent was sheet metal
fabrication. There were 8 to 10 other companies in Orange County
also doing that work. Petitioner served a large part of southern
California, including the counties of San Diego, Orange, Los
Angeles, and Riverside.
Petitioner's fiscal years ended on June 30 in 1964, 1966 to
1975, 1977, 1978, 1980 to 1982, 1984, and 1985. In 1986,
petitioner changed the end of its fiscal year from June 30 to
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