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records. As noted supra note 2, respondent’s approach results in
petitioner’s cost of goods sold being $82,691 more than the
amount claimed on petitioner’s tax return.
On brief, petitioner claims at one point that only 5,029,368
gallons of diesel fuel were sold during petitioner’s fiscal 1990,
but elsewhere petitioner appears to accept respondent’s approach
to determining the number of gallons of diesel fuel it bought and
how much petitioner paid for that diesel fuel. We note that
petitioner does not ask us to hold that the cost of goods sold as
to diesel fuel is different from that claimed by respondent.
Petitioner does not claim to have bought more diesel fuel
than it sold (e.g., because of evaporation or theft). Petitioner
does not suggest any way in which we should or could arrive at
monthly cost averages to be applied to varying purchase amounts--
in contrast to what we have done with regard to gallons of diesel
fuel sales and sale prices. Neither side suggests that opening
and closing inventory (ordinarily an essential element in
calculating cost of goods sold) should be accounted for in the
instant case.
Under the circumstances, we uphold respondent’s approach as
to petitioner’s diesel fuel sales cost of goods sold.
(d) Conclusions.
Based on the foregoing, we hold for respondent on this
issue, except as to the slight modifications described supra.
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