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Kirkham--23 percent; J. Kirkham--18 percent; M. Kirkham--18
percent; and L. Sponenburgh--18 percent. At all relevant times,
Kapsco was a going concern.
Kapsco operated 10 retail stores in fiscal year 1991 and 9
retail stores in fiscal year 1992. Kapsco's retail stores during
those years were primarily located in eastern Idaho and included
the following: (1) Blackfoot; (2) Driggs; (3) Idaho Falls--
Milligan; (4) Idaho Falls--Park; (5) Montpelier; (6) Pocatello; (7)
Rigby; (8) Shelley; (9) American Falls; and (10) Rexburg. The
retail stores were not separately incorporated.
In order to expand their sales base, the Kirkham family
organized Kaps Automotive Warehouse, Inc. (KAW), in 1979. During
the years at issue, KAW's shareholders and their respective
percentage ownership interest were as follows: Petitioner--25
percent; J. Kirkham--25 percent; M. Kirkham--25 percent; L.
Sponenburgh--25 percent. At all relevant times, KAW was a going
concern.
In 1979, KAW acquired Nordling Parts Co. of Twin Falls (NPC).
(Although KAW acquired 100 percent of NPC's stock, NPC's original
income tax returns for fiscal years 1991 and 1992 indicate that KAW
owned only 75 percent of NPC's stock.) NPC was KAW's jobber (or
retail) store. At all relevant times, NPC was a going concern.
During the years at issue, the officers of petitioner, Kapsco,
NPC, and KAW were: M. Kirkham--president; J. Kirkham--vice
president; and W. Sponenburgh--secretary.
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