Consolidated Manufacturing, Inc., M. P. Long Living Trust, Merl Philip Long, Trustee, Tax Matters Person - Page 8

                                         -8-                                          
               Bishop Engine determined the amounts that it was willing to            
          pay for non-bin salvage yard cores and reflected those amounts in           
          price sheets (price sheets) provided to its employees and                   
          distributed to salvage yards approximately every 3 months.                  
          Bishop Engine paid the same amounts for bin salvage yard cores              
          that passed inspection at its place of business and for cores               
          acquired from individual peddlers as those listed in the price              
          sheets for the same types of cores.  Bishop Engine adjusted those           
          price sheets weekly as necessary to reflect any changing market             
          conditions, such as an increase in prices due to increased demand           
          from automobile parts remanufacturers and a decrease in prices,             
          but in no event below scrap value, due to decreased demand from             
          those remanufacturers.  Bishop Engine distributed those weekly              
          adjusted price sheets every Monday morning to its employees, who            
          informed the salvage yard operators of changes in the price                 
          sheets.  (We shall refer to the amounts that Bishop Engine paid             
          for non-bin salvage yard cores and for bin salvage yard cores               
          that passed inspection at its place of business as the salvage              
          yard cost.)  Bishop Engine paid scrap value for the bin salvage             
          yard cores that did not pass inspection at its place of business            
          and for the types of cores acquired from individual peddlers that           
          were not listed on the price sheets.                                        
               Bishop Engine generally paid the cost of shipping the                  
          salvage yard cores that it had purchased to its place of                    
          business.  At Bishop Engine's place of business, its employees              




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