- 3 -
The contracts do not provide for interest. Nevertheless, Union
Elevator paid petitioners interest at a rate of 5 percent per
annum. The following table contains the material terms of the
contracts in question:1
Number Net Payment Interest Total
5554A $38,618.65 $449.67 $39,068.32
5644A 854.30 7.37 861.67
5654A 2,210.50 18.77 2,229.27
5658A 6,636.61 56.37 6,692.98
5658A 12,534.33 106.46 12,640.79
5682A 11,790.75 92.06 11,882.81
5785A 7,880.40 42.10 7,922.50
5793A 37,925.87 187.03 38,112.90
5793A 17,869.47 88.12 17,957.59
5798A 19,800.50 94.93 19,895.43
Total 156,121.38 1,142.88 157,264.26
The wheat that petitioners sold pursuant to the contracts was
sold at the prevailing market price for wheat as of the date of
each contract.
Union Elevator used grain settlement statements in deter-
mining the amount to be paid to petitioners. The amount to be
paid consisted of the gross price agreed upon for the wheat, less
any grade discount or premiums, storage charges, and Washington
State Wheat Commission tax. Also, petitioners pledged the
1The amount shown for contract 5554A is net of the portion
pledged to secure a loan from Commodity Credit Corporation (CCC).
Respondent argues, and we agree, that, if we find for respondent,
then the full amount of this contract should be included in
income, not reduced for the amount pledged to CCC.
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Last modified: May 25, 2011