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over such cost and market that Consolidated credited to each
customer account receivable are deductible expenses under section
162.
In support of respondent's position that Consolidated's
FIFO-LCM method does not clearly reflect income, respondent
contends that Consolidated acquired customer cores in purchase,
and not exchange, transactions and that therefore the cost and
the market for those cores for purposes of section 471 are to be
determined by reference to the invoice prices that were shown on
the customer core sales invoices. According to respondent, those
invoice prices are the amounts (viz, the core credit amounts)
that Consolidated credited to each customer account receivable
and that were shown on those invoices under the column headed
"Cores--Price Each".25
Respondent further asserts that even if the Court were to
find that the transactions by which Consolidated acquired
customer cores were exchanges, and not purchases, respondent's
25 On brief respondent uses the term "core amount" when
refer-ring to the amount that Consolidated credited to each
customer account receivable for each core that it acquired. In
fact, the amount of such a credit was generally equal to the core
amount, and we assume that respondent uses the term "core amount"
for convenience. However, because of, inter alia, the condition
of each customer core that a customer decided to deliver to
Consol-idated, it was possible that Consolidated sometimes
credited to a customer account receivable an amount that was less
than the core amount. Unless we are quoting from the briefs of
the parties, we shall refer to the amounts that Consolidated
credited to each customer account receivable as the core credit
amounts.
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