General Motors Corporation and Subsidiaries - Page 3




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          Background                                                                   
               Most of the facts have been stipulated and are so found.                
          The stipulation of facts, the supplemental stipulation of facts,             
          the stipulation of partial settlement, the stipulation of settled            
          issues and the attached exhibits are incorporated herein by this             
          reference.  At the time it filed the petition, GM had its                    
          principal place of business in Detroit, Michigan.                            
          I.   General Background                                                      
               GM is a corporation duly organized under the laws of the                
          State of Delaware, doing business directly and through                       
          subsidiaries in the United States and abroad.  For 1985 and all              
          relevant prior and subsequent years, GM filed a consolidated                 
          Federal income tax return, Form 1120, on a calendar year basis on            
          behalf of GM and its consolidated affiliated subsidiaries within             
          the meaning of section 1504.  In 1985 and all relevant prior and             
          subsequent years, General Motors Acceptance Corporation (GMAC), a            
          wholly owned subsidiary of GM, was part of the GM group.  GM and             
          GMAC both maintain their books and records, and report their                 
          income for Federal income tax purposes, using the accrual method             
          of accounting.                                                               
               At all relevant times, GM was a multiplant manufacturing                
          enterprise primarily engaged in the design, manufacture,                     
          assembly, and sale of motor vehicles (including automobiles,                 
          trucks, and buses) and related parts and accessories.                        





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