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received in 1996 only after Pepsi performed its investigation in
1997 (i.e., only after Pepsi decided to approve payment).
With regard to the marketing funds payment in 1997 for the
last half of 1996, petitioners reiterate that under the
agreement, Pepsi had 60 days from the end of 1996 to determine
whether the theater company had complied with the performance
criteria of the agreement. Petitioners therefore implicitly
argue that only after Pepsi had conducted its review and
established for itself that the theater company was entitled to
the funds did the theater company have a fixed right to receive
that income.
Respondent disagrees with petitioners that the flex and
marketing funds paid in 1996 constitute refundable deposits and
instead considers the payments as advances subject to accrual in
1996. As to petitioners' other contentions, respondent counters
that by the close of 1996, the theater company had performed all
outstanding obligations required under the agreement to accrue
the marketing funds paid in 1997. Specifically, respondent
argues that the agreement did not call for a review or
investigation by Pepsi–-it called only for the theater company's
performance.
IV. Deposits Versus Advances
In Commissioner v. Indianapolis Power & Light Co., supra,
the Supreme Court dealt with the issue of whether certain
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