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part of a product such as petitioner’s paper products. The ink
and characterless paperstock which the printers sell to
petitioner is sufficiently different from the character-filled
paper products which petitioner sells to its customers so as to
characterize the latter products as sold initially by petitioner,
rather than as sold first by the printers to petitioner and then
resold by petitioner to its customers. We also note that the
approximately 60-percent gross profit percentage reported by
petitioner for the subject year on the sale of its paper products
leads directly to the conclusion that the printers charge
petitioner solely for the paper, ink, and labor devoted to the
paper products, rather than for the value of the paper products
as items that are sold to petitioner for purposes of resale.
Petitioner focuses on the fact that the printers bear the
risk of loss during the printing process. We do not find this
fact dispositive as to who owns (and thus produces) the paper
products. The identification of the owner of property for
purposes of the UNICAP rules does not necessarily rest on who
bears the risk of loss when the product is fabricated or
assembled, or, for that matter, on who actually turns the screws
or hammers the nails into the product. The owner of property
must be identified from the facts and circumstances of the case,
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