Compaq Computer Corporation and Subsidiaries - Page 40




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          borne by Compaq Asia that were not borne by the unrelated                   
          subcontractors.  The parties stipulated that, during 1991 and               
          1992, Compaq Asia incurred $4.6 million in expenses related to              
          cancellation of raw material contracts and component                        
          obsolescence.  Of that amount, $4.2 million is attributable to              
          PCA cancellation and obsolescence costs with the remaining                  
          $400,000 attributable to CPU cancellation and obsolescence costs.           
               The price adjustments asserted and quantified by petitioner            
          are summarized in the following table:                                      

                                                   Compaq Asia Price                  
                                                   Increase/(Decrease)                
          PCA price adjustment                          ($6.4 million)                
          Transactional adjustments                                                   
          Add:                                                                        
          Payment terms                                  $8.9 million                 
          Advance purchase costs                         $4.2 million                 
          Setup & cancellation charges                   $2.9 million                 
          Less:                                                                       
          Freight                                       ($2.6 million)                
          Duties                                        ($1.2 million)                
          Defective PCA costs                           ($1.3 million)                
          Overall PCA price adjustment                   $4.5 million                 

          These adjustments would indicate that Compaq U.S. paid prices to            
          Compaq Asia that were less than the comparable prices paid by               
          Compaq U.S. to the unrelated subcontractors for nearly identical            
          PCA's, adjusted for physical and transactional differences.                 






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