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craftsmanship in hand-cutting and incorporating custom designs,
such a corporate logos, into flooring jobs. Smith Floors enrolls
its employees in annual training programs where the employees are
instructed (and certified) in the installation of various
flooring materials.
During 1995, Smith Floors had a total of 836 jobs: 555 jobs
required Smith Floors to purchase and install flooring materials
and 281 jobs required Smith Floors to provide installation-only
services. Smith Floors’ has provided flooring installation
services for a number of large companies including Albertson’s
(grocery stores), Marriott (hotels), Walgreens (drug stores),
Pacific Theaters, and Walt Disney Corporation, as well as the
U.S. General Services Administration. Smith Floors frequently
installs either proprietary or custom-designed flooring
materials. Normally, the companies contracting with Smith Floors
negotiate the price of such flooring materials in advance
directly with the manufacturer of the flooring materials.
Smith Floors has consistently used the cash method of
accounting to prepare its corporate income tax returns. Smith
Floors routinely assigns a value of $15,000 to its inventory from
year to year to account solely for flooring installation
materials on hand such as glue/adhesives, nails, cap metal, and
cove stick. Smith Floors does not consider flooring materials
and padding on hand at the end of the year to be inventory
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Last modified: May 25, 2011