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EAPR maintained its own bank account in Puerto Rico from
which it paid for raw materials and components, labor (including
amounts paid to PPI), and other supplies and services. EAPR’s
board of directors authorized officers of EAPR and two employees
of EA’s accounting department to execute checks on behalf of
EAPR. EAPR’s checks for raw materials and components, labor
(including amounts paid to PPI), and other supplies and services
were prepared and signed on EAPR’s behalf by these authorized
people in EA’s offices in San Mateo.
EA employees in San Mateo entered purchase forecast and
order information into the MRP System. Unrelated vendors shipped
raw materials and components directly to EAPR in Puerto Rico,
based on need as determined under the MRP System. Deliveries of
raw materials and components were received and inspected by
EAPR’s manager, lease employees, or PPI employees; these services
by PPI employees were covered by the Agreement. The raw
materials and components were stored in separately identified
warehouse space covered by the Lease.
At or near the end of each fiscal year, one or more lease
employees, under the supervision of EAPR’s manager and an
accounting staff person from EA who visited Puerto Rico for this
purpose, performed a physical inventory of EAPR’s materials
inventory, work in process, and finished goods.
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Last modified: May 25, 2011