- 15 - Mid-Del reported the following gross receipts, direct costs associated with patient treatments, and gross profit for 1993, 1994, and 1995, using the cash method of accounting: TYE Gross Other costs Gross Medical supplies and Medical supplies receipts1 profit drugs included in and drugs as a other costs percentage of gross receipts 1993 amended2 $1,849,403 $643,959 $1,205,444 unknown unknown 1994 2,469,928 806,510 1,663,418 $806,510 33 1995 1,780,767 721,944 1,058,823 721,994 41 1 Net of returns and allowances, for 1994 and 1995. 2 Mid-Del originally reported its income for 1993 using an accrual method of accounting. During an audit of its 1993 Federal income tax return, Mid-Del submitted an amended return reporting its income and expenses for 1993 using the cash method of accounting. The audit was closed by agreement using the figures reflected on the amended return. The combined average annual gross receipts of both petitioners for the 3 years ending with the taxable years in issue was less than 5 million dollars. For accounting purposes, Mid-Del and PC each valued their chemotherapy drugs and miscellaneous medications at actual cost. As of taxable years ending April 30, 1994, and April 30, 1995, PC's drugs on hand were valued at $44,593 and $42,143, respectively. As of December 31, 1994, 1995, and 1996, Mid-Del's drugs on hand were valued at $37,273, $60,382, and $67,634, respectively. Neither petitioner made any attempt to manipulate income or expenses by deferring income or paying unnecessary expenses at the end of the taxable year.Page: Previous 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Next
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