Summary
In Alma Piston Co. v. Commissioner, T.C. Memo. 1976-107, affd. 579 F.2d 1000 (6th Cir. 1978), we provided the following justification for use of peak figures:Where experience has shown that there are times during the year when a corporation is required to building up its inventory or carry accounts receivable beyond the normal collection period, we believe prudent business judgment would call for the retention of cash or other liquid assets in an amount necessary to meet the corporation's expenses during these peak periods 35 T.C.M. 464, 476, 45 P-H Memo T.C. par. 76, 107, 76-467.
Summary of this case from Snow Mfg. Co. v. Comm'r of Internal RevenueOpinion
No. 77-1095.
July 3, 1978.
Paul R. Trigg, Jr., Joel J. Morris, Dykema, Gossett, Spencer, Goodnow Trigg, David M. Rosenberger, Detroit, Mich., for petitioner-appellant.
Myron C. Baum, Acting Asst. Atty. Gen., Tax Div., U.S. Dept. of Justice, Washington, D.C., Gilbert E. Andrews, Crombi, J.D. Garrett, Richard Farber, Meade Whitaker, Chief Counsel, I.R.S., Charles L. Saunders, Jr., Washington, D.C., for respondent-appellee.
Appeal from United States Tax Court.
Before WEICK, EDWARDS and CELEBREZZE, Circuit Judges.
ORDER
On receipt and consideration of an appeal in the above-styled case; and
Finding that contrary to the contentions of appellant, the Tax Court properly determined that appellant corporation had been "availed of for the purpose of avoiding the income tax with respect to its shareholders," and that there was no proof to the contrary from the corporation by which this court could find that the Tax Court findings were clearly erroneous.
Now, therefore, the judgment of the Tax Court is affirmed for the reasons as to this issue set forth in the opinion of the Tax Court dated April 6, 1976, 35 T.C.M. (CCH) 464 (1976).