- 7 - petitioner filled out a receipt, gave one copy to the customer, and placed the other copy in a drawer. When the video was returned, petitioner matched it to the receipt and wrote the letter “R” on the receipt to indicate that the video had been returned. These receipts were examined each month by Washington State officials to determine petitioner’s Washington State excise tax liability, which apparently was based in some part on gross receipts. During the years in issue, Grand Video’s video rental prices ranged from $1 to $3.50 per day. Many customers paid by check, but most transactions were in cash; credit cards were not accepted. The cash register in Grand Video’s store was used to hold cash and make change, but not to record income from rental and sales transactions. Petitioner maintained several bank accounts during the years in issue. One checking account was dedicated to Grand Video (the business account). Many business expenses, including rent, utilities, and store maintenance were paid by checks drawn on the business account. Other business expenses were paid by cash and recorded in a cash journal, but income received in cash was not. Entries in the cash journal, including the cost of the journal itself (i.e., $5.25), range from $.89 for a drill bit to $879.39 for “new carpet”.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011