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that any check-cashing by Kenmore might have affected the mix of
checks and currency that Kenmore deposited, but did not affect
the total amounts of the deposits. Accordingly, we conclude
that, if Kenmore indeed did any check-cashing, that is not a
nontaxable source of gross receipts.
We conclude, and we have found, that respondent has shown by
clear and convincing evidence that none of Kenmore’s suggested
nontaxable sources (other than the $6,600 per year purchase-money
mortgage payments) explains its unreported income.
(b) Purchases.
On its tax returns, Kenmore claimed to have spent almost
$1.75 million on purchases over fiscal 1981 and fiscal 1982.
Supra tables 1 and 6. In the notice of deficiency, respondent
determined that Kenmore had spent $877,000 more than Kenmore had
claimed for those 2 years. Supra tables 3 and 4. On brief,
respondent concedes that Kenmore spent over $1 million more than
Kenmore had claimed for those 2 years. Supra tables 3 and 4.
Our findings are in amounts slightly greater than respondent’s
concessions. Supra tables 3, 4, and 6. Thus, we treat Kenmore
as having spent, and as being entitled to subtract, more than
$2.81 million in purchases for those 2 years, even though Kenmore
claimed only $1.75 million on its tax returns for those 2 years.
Supra tables 3, 4, and 6.
Petitioners do not make any specific contentions on brief
about their allowable costs of purchases. They do make
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