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result on these facts. Thus, although petitioners may or may not
be technically correct in contending that the bank deposits
method overstates Kenmore’s gross receipts because of these
Broskin transactions, this method does not cause Kenmore’s
taxable income to be overstated.
Petitioners suggest that the prebuys may have resulted in
the bank deposits method’s overstating Kenmore’s gross receipts.
Only one prebuy is described in some detail, (1) in testimony by
Bohn and Broskin and (2) in a stipulated extract from Kenmore’s
books and records. On or about May 19, 1982, Kenmore gave
$105,000 cash to Broskin, for him to buy 100,000 gallons of
gasoline. Broskin delivered the gasoline in 13 installments to
Kenmore over a 5-week period. Most of the deliveries were to the
Sheridan location. Broskin invoiced Kenmore for the delivered
gasoline at $1.05 per gallon, plus an amount for trucking.
Kenmore’s books show the transaction as “Purchased in advance
from Broskin”, with each delivery resulting in a reduction of the
amounts in both the “Bal. gal.” and the “Bal. $” columns. The
final delivery, on June 22, 1982, resulted in the “Bal. gal.”
column being reduced to zero and the “Bal. $” column being
reduced to negative $2,240.57. This last amount is shown as
having been paid on June 25, 1982, with the balance in the “Bal.
$” column then shown as zero. We are satisfied from the record
in the instant cases that this transaction involved (1)
$107,240.57 deductible expenditures ($105,000 for the gasoline
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