Zeeman Manufacturing Company, Inc. - Page 12

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          computation contains mathematical errors.  Respondent also                  
          contends that petitioner did not provide the source of the                  
          financial information included in the Bardahl computation.                  
          Alternatively, respondent argues that, as certain amounts in                
          petitioner's Bardahl computation do not correspond with the                 
          numbers in the Dun & Bradstreet credit compilation attached to              
          the section 534(c) statement, petitioner's "conflicting"                    
          information does not provide "specific amounts" needed to be                
          expended for business needs.                                                
               In Gustafson's Dairy, Inc. v. Commissioner, T.C. Memo. 1995-           
          11, we stated that a taxpayer will have made a sufficient                   
          disclosure of its Bardahl computation if the taxpayer adequately            
          states the formula relied upon for determining an anticipated               
          need, sufficient data to use the formula, and the end result of             
          the formula.  In its section 534(c) statement, petitioner has               
          stated a formula, furnished the data to use the formula,5 and               
          calculated an end result of the formula for its taxable years               
          ended 1991 through 1993.6  For the Bardahl computation for each             
          taxable year, petitioner provided, inter alia, the cost of goods            


          5    We note that, since the filing of the instant motion and the           
          supporting memoranda of law thereunder, the parties have agreed             
          to certain changes in the Bardahl computation.  We, however,                
          address only the sec. 534(c) statement and the Bardahl                      
          computation included therein.  Sec. 534(a)(2); sec. 1.534-                  
          2(a)(2), Income Tax Regs.                                                   
          6    Respondent cites no specific mathematical errors, and we               
          find no such errors in petitioner's Bardahl computation.                    




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