Full opinion text
OPINION TSOUCALAS, Judge: Plaintiffs, Federal-Mogul Corporation (“Federal-Mogul”) and The Torrington Company (“Torrington”), commenced this action challenging certain aspects of the Department of Commerce, International Trade Administration’s (“Commerce” or “ITA”) final results of administrative review entitled Final Results of Antidumping Duty Administrative Reviews and Revocation in Part of an Antidumping Duty Order (“Final Results ”), 58 Fed.Reg. 39,729 (1993), as amended, Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From France, Germany, Italy, Japan, Romania, Singapore, Sweden, Thailand, and the United Kingdom; Amendment to Final Results of Antidumping Duty Administrative Reviews, 58 Fed.Reg. 42,288 (1993), An-tifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From France and the United Kingdom; Amendment to Final Results of Antidumping Duty Administrative Reviews, 58 Fed.Reg. 51,055 (1993), and Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From Japan; Amendment to Final Results of Antidumping Duty Administrative Reviews, 59 Fed.Reg. 9,469 (1994). Background On April 27, 1993, Commerce published the preliminary results of its administrative review of antidumping duty , orders on anti-friction bearings (“AFBs”) (other than tapered roller bearings) and parts thereof from Japan, France, Germany, Italy, Romania, Singapore, Sweden, Thailand and the United Kingdom. See Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From Japan; Preliminary Results of Antidumping Duty, Administrative Reviews and Partial Termination of Administrative Reviews, 58 Fed.Reg. 25,616 (1993). On July 26, 1993, Commerce published the Final Results at issue. See Final Results, 58 Fed.Reg. at 39,729. Federal-Mogul and Torrington now move pursuant to Rule 56.2 of the Rules of this Court for judgment on the agency record alleging the following actions by Commerce were unsupported by substantial evidence on the agency record and not in accordance with law: (1) adjusting United States price (“USP”) by adding an amount for taxes incurred on sales in the home market; (2) refusing to find that below-cost transfer pricing constituted reimbursement of antidumping duties to be subtracted from exporter’s sales price (“ESP”); (3) using constructed value to calculate foreign market value (“FMV”) for certain bearings; (4) calculating inventory carrying costs for ESP sales based upon transfer prices; (5) refusing to recognize certain home market sales as being “similar” to U.S. models; (6) failing to reallocate Meter S.p.Afs (“Meter”) claimed U.S. warranty expenses which were not tied to specific sales; (7) allocating NSK Ltd. and NSK Corporation’s (collectively “NSK”) indirect expenses over sales to all U.S. customers; (8) including below-cost sales in calculating profit for purposes of determining constructed value; (9) using two different methodologies for the assessment of antidumping duties and for the establishment of future cash deposit rates; (10) adjusting FMV for pre-sale inland freight expenses; (11) refusing to deduct resale profit from ESP; (12) treating home market rebates, discounts and billing adjustments as indirect selling expenses; (18) including certain below-cost sales in its calculation of FMV; (14) using weighted-average entered value data to determine whether to exclude the sales of Koyo Seiko Co., Ltd. and Koyo Corporation of U.S.A. (collectively “Koyo”) pursuant to the “Roller Chain” rule; (15) accepting selling expenses reported on the basis of transfer prices by NTN Bearing Corporation of America, American NTN Bearing Manufacturing Corp., NTN Corporation and NTN Kugellagerfabrik (Deutschland) GmbH (collectively “NTN”); (16) adjusting NTN’s USP for interest paid on cash deposits of anti-dumping duties; (17) refusing to deduct liaison expenses from ESP; (18) treating NTN’s aftermarket sales as a separate level of trade; (19) using quantity rather than weight as a measure of home market viability; (20) treating “Route B,” bonded warehouse, and dollar-denominated sales of NMB Singapore Ltd., Pelmec Industries (Pte.) Ltd., NMB Thai Ltd. and Pelmec Thai Ltd. (collectively “NMB/Pelmec”) as home market sales; (21) including NMB/Pelmee’s Thailand sales to related parties in the calculation of profit for constructed value; and (22) committing various clerical errors. Discussion The Court’s jurisdiction in this action is derived from 19 U.S.C. § 1516a(a)(2) (1988) and 28 U.S.C. § 1581(c) (1988). The Court must uphold Commerce’s final determination unless it is “unsupported by substantial evidence on the record, or otherwise not in accordance with the law.” 19 U.S.C. § 1516a(b)(1)(B) (1988). Substantial evidence is “more than a mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Universal Camera Corp. v. NLRB, 340 U.S. 474, 477, 71 S.Ct. 456, 459, 95 L.Ed. 456 (1951) (quoting Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 216, 83 L.Ed. 126 (1938)). “It is not within the Court’s domain either to weigh the adequate quality or quantity of the evidence for sufficiency or to reject a finding on the grounds of a differing interpretation of the record.” Timken Co. v. United States, 12 CIT 955, 962, 699 F.Supp. 300, 306 (1988), aff'd, 894 F.2d 385 (Fed.Cir.1990). 1. Tax Adjustments Federal-Mogul and Torrington object to Commerce’s attempt to achieve tax neutrality by adding to USP the amount of tax paid on home market sales rather than the actual tax forgiven on export sales. Brief of FederaU Mogul Corporation in Support of its Motion for Judgment Upon the Agency Record CFederalr-Mogul's Brief”) at 5-7; Memorandum in Support of The Torrington Company’s Motion for Judgment Upon the Administrative Record (“Torrington’s Brief”) at 102-05. Federal-Mogul and Torrington contend that Commerce’s approach is inconsistent with 19 U.S.C. § 1677a(d)(l)(C) (1988). Commerce agrees that a remand is necessary to apply a new tax methodology. Defendant’s Memorandum in Opposition to the Motion of Federal-Mogul Corporation for Judgment Upon the Agency Record (“Commerce’s Brief I”) at 5-8; Defendant’s Memorandum iri■ Opposition to the Motions of The Torrington Company and Federal-Mogul Corporation for Judgment Upon the Agency Record (“Commerce’s Brief II ”) at 56-58. In Federal-Mogul Corp. v. United States, 63 F.3d 1572 (Fed.Cir.1995), the Court of Appeals for the Federal Circuit (“CAFC”) upheld Commerce’s tax-neutral methodology. Specifically, the CAFC stated the following: [I]n administering the Act, the Agency over the years has pursued a policy of attempting to make the tax adjustment called for by the Act tax-neutral. We conclude that Commerce’s long-standing policy of attempting tax-neutrality in its administration of this provision is not precluded by the language of § 1677a, nor do we find the particular proposed methodology to be an unreasonable way to pursue that policy in fight of the statutory language. Federal-Mogul, 63 F.3d at 1580. In fight of the decision of the CAFC in Federal-Mogul, the Court finds that a remand for Commerce to apply a new methodology is unnecessary. Commerce’s approach of adding to USP the amount of tax paid on home market sales is in accordance with the decision of the CAFC in Federal-Mogul and, therefore, sustained. 2. Reimbursement of Antidumping Duties Federal-Mogul and Torrington argue that Commerce erred by failing to deduct from ESP antidumping duty reimbursements. Specifically, Federal-Mogul and Torrington assert that whenever a foreign manufacturer sells merchandise to a related U.S. importer at prices below cost plus profit or alternatively, below cost, the transaction should be regarded as a transfer of funds to the extent that prices are less than the benchmark. Accordingly, Federal-Mogul and Torrington maintain that these transfer prices should be treated as duty reimbursements to the extent that dumping margins are found and should be deducted from USP pursuant to 19 C.F.R. § 353.26(a) (1993). Federal-Mogul’s Brief at 7-11; Torrington’s Brief at 47-56. Both Federal-Mogul and Torrington further contend that 19 C.F.R. § 353.26(a) applies in ESP situations. Federal-Mogul’s Brief at 9; Torrington’s Brief at 50-54. Federal-Mogul further supports its contentions by suggesting that the antidumping law “collapses” related entities in ESP situations into one entity. Federal-Mogul’s Brief at 9-10. According to Federal-Mogul, payment by the ESP importer is actually payment by the producer on behalf of the importer and, therefore, such payments are covered by the reimbursement regulation at issue. Id. In response, Commerce claims that the reimbursement regulation does not apply to related parties in an ESP situation. Commerce’s Brief II at 15-17. Commerce cites the definition of “exporter” contained in 19 U.S.C. § 1677(13) to support its argument that in an ESP situation, where the importer and the related producer are treated as one entity, that entity cannot reimburse itself pursuant to 19 C.F.R. § 353.26(a). Furthermore, Commerce submits that even if the reimbursement regulation applies to ESP sales, there is no evidence that the foreign manufacturer reimbursed the U.S. importer for antidumping duties. Commerce’s Brief II at 17. The reimbursement regulation, 19 C.F.R. § 353.26, which governs this issue, reads in part as follows: (a) In general. (1) In calculating the United States price, the Secretary will deduct the amount of any antidumping duty which the producer or reseller: (i) Paid directly on behalf of the importer; or (ii) Reimbursed to the importer. The Court has interpreted this regulation to require evidence beyond mere allegation that the foreign manufacturer either paid the an-tidumping duty on behalf of the U.S. importer, or reimbursed the U.S. importer for its payment of the antidumping duty. Torring ton Co. v. United States, 19 CIT -, -, 881 F.Supp. 622, 631 (1995). In the Final Results, Commerce stated the following with respect to its decision not to apply the reimbursement regulation: ■ As stated in AFBs II, 57 FR at 28371, the antidumping statute and regulations make no distinction in the calculation of USP between costs incurred by a foreign parent company and those incurred by its U.S. subsidiary. Therefore, the Department does not make adjustments to U.S. price based upon intraeompany transfers of any kind. Indeed, the Department has a longstanding practice of denying adjustments for intraeompany payments on the grounds that, because affiliated companies are a single entity for the purposes of antidump-ing law, payments from a parent company to its subsidiary are not expenses to the consolidated corporation as a whole. [Bjecause we treat a foreign producer and its U.S. subsidiary as a single entity for all purposes in calculating weighted-average margins, we cannot treat the two companies as separate entities for purposes of the duty payment. The governing statute and regulations do not contemplate applying the reimbursement provision to related parties in an ESP situation. Final Results, 58 Fed.Reg. at 39,736 (citations omitted). In Torrington, 19 CIT at -, 881 F.Supp. at 631-32, this Court upheld Commerce’s decision not to apply the reimbursement regulation based upon the same reasoning provided by Commerce in the case at bar. The Court held that because Torrington failed to produce evidence linking the intracorporate transfers to the reimbursement of antidumping duties, Commerce was not required to make a deduction to USP for antidumping duty reimbursement. Id. at -, 881 F.Supp. at 632. In the present case, Torrington again fails to establish a link between intracorpo-rate transfers and the reimbursement of an-tidumping duties. Torrington’s arguments based on theories concerning international transfer pricing do not amount to more than mere allegation and, therefore, are insufficient to meet the requirements of the reimbursement regulation. See Torrington’s Brief at 47-48. As such, the Court sustains Commerce’s decision not to adjust USP based upon'intraeompany transfers. 3. Use of Constructed Value to Calculate FMV Federal-Mogul contends that Commerce improperly resorted to use of constructed value without considering sales of similar merchandise. Federal-Mogul’s Brief at 11-14. According to Federal-Mogul, if Commerce is unable to use sales of identical merchandise to compute FMV because of extensive below-cost sales, the statute requires Commerce to calculate FMV on the basis of similar merchandise before resorting to constructed value. Id. at 12-14. To support its position, Federal-Mogul relies on the court’s decision in Timken Co. v. United States, 10 CIT 86, 95, 630 F.Supp. 1327, 1336 (1986) (holding that Commerce abused its discretion by failing to collect data concerning respondent’s selection of similar merchandise). Commerce responds that once it determined that over 90% of home market sales of matched bearings were made at below cost over an extended period of time, Commerce properly resorted to constructed value to compute FMV pursuant to 19 U.S.C. § 1677b(b) (1988). Commerce’s Brief I at 13-18. Commerce maintains that the statute grants Commerce the authority to determine what constitutes “such or similar merchandise” under 19 U.S.C. § 1677(16) (1988) and expresses a preference for the use of identical merchandise over similar merchandise. Id. at 16. Commerce further argues that the determination of “such or similar merchandise” is made solely on the basis of the physical similarity of the merchandise and without regard to the cost of the merchandise. As such, Commerce claims that once it disregards home market sales as being below cost, the statute requires Commerce to resort immediately to constructed value rather than determine the next most similar match with above-cost sales. Id. at 16-17. In support of Commerce, FAG Kugelfischer Georg Schafer KGaA, FAG Italia, S.p.A., FAG (U.K.) Limited, The Barden Corporation (U.K.) Limited, FAG Bearings Corporation and The Barden Corporation (collectively “FAG”), defendant-intervenors, argue that 19 U.S.C. § 1677(16) establishes a “such or similar” hierarchy which requires Commerce to match the U.S. product to either an identical or similar foreign market based solely on the physical similarity of the goods before applying the below-cost test. Memorandum, of Defendant-Intervenors FAG Kugelfischer Georg Schafer KGaA, FAG Italia S.p.A., FAG (U.K.) Limited, The Barden Corporation (U.K.) Limited, FAG Bearings Corporation and The Barden Corporation in Opposition to Plaintiffs Rule 56.2 Motion for Judgment Upon the Agency Record (“FAG’s Brief I”) at 16. FAG submits that if a match is found due to physical similarities, then the statute requires Commerce to conduct a below-cost test under 19 U.S.C. § 1677b(b). FAG’s Brief I at 16-17. According to FAG, if a substantial number of the models are sold at below-cost prices over an extensive period of time, then the statute instructs Commerce to employ constructed value without returning to the “such or similar” analysis. Id. at 17-18. In further support of Commerce, NTN, defendant-intervenor, points out that the methodology used by Commerce is consistent with its longstanding practice. Brief of NTN Corporation and NTN Corporation of America, American NTN Bearing Manufacturing Corporation and NTN Kugellagerfabrik in Response to Plaintiffs’ Rule 56.2 Motion for Judgment Upon the Agency Record (“NTN’s Brief I”) at 6. NTN emphasizes that Commerce’s reasonable interpretation of the statute cannot be overridden by Federal-Mogul’s alternative even if it appears to be reasonable. NTN’s Brief I at 8. Emerson Power Transmission Corporation (“Emerson”), defendant-intervenor, distinguishes Timken, 10 CIT at 95-96, 630 F.Supp. at 1336-37, from the ease at bar, arguing that Timken concerns using similar merchandise when there are no values for such merchandise. Defendant-intervenor Emerson Power Transmission Corporation’s Memorandum in Opposition to Plaintiffs’ Motions for Judgment Upon the Administrative Record (“Emerson’s Brief’’) at 10-11. The statute defines FMV as the price at which “such or similar merchandise” is sold in the home market or to third countries. 19 U.S.C. § 1677b(a)(l) (1988). “Such or similar merchandise” is defined in 19 U.S.C. § 1677(16) as follows: The term “such or similar merchandise” means merchandise in the first of the following categories in respect of which a determination for the purposes of part II of this subtitle can be satisfactorily made: (A) The merchandise which is the subject of an investigation and other merchandise which is identical in physical characteristics with, and was produced in the same country by the same person as, that merchandise. (B) Merchandise— (i) produced in the same country and by the same person as the merchandise which is the subject of the investigation. (ii) like that merchandise in component material or materials and in the purposes for which used, and (iii) approximately equal in commercial value to that merchandise. (C) Merchandise— (i) produced in the same country and by the same person and of the same géneral class or kind as the merchandise which is the subject of the investigation, (ii) like that merchandise in the purposes for which used, and (iii) which the administering authority determines may reasonably be compared with that merchandise. In the Final Results, Commerce stated the following regarding its decision to resort to constructed value to compute FMV: We disagree with Federal-Mogul’s and Koyo’s contention that the statute and regulations express a preference for price-to-priee comparisons such that, in the event that a “matched” home market model forms an inadequate FMV because of extensive below-cost sales, the Department should calculate FMV based on the prices of the next most similar merchandise before resorting to CV [constructed value]. We first note that this issue arises only in situations where all home market sales of a model are disregarded due to the below-cost test. Under our current methodology, we disregard all home market sales of a model from our analysis and immediately resort to CV if more than 90 percent of the sales of that model were made below cost over an extended period of time, and are not at prices that permit recovery of all costs within a reasonable period of time in the normal course of trade. ... [B]ecause section 771(16) specifies that the determination of such or similar merchandise depends solely on the similarity of the merchandise and not on whether the most similar model is sold above cost, our resort to CV, after finding the most similar model and then determining that it is sold below cost in over 90 percent of home market sales, does not conflict with this provision. 58 Fed.Reg. at 39,765. The Court finds that Commerce’s interpretation of the statute is reasonable. Sections 1677b(a)(l) and 1677(16) have been interpreted by the court to create a hierarchy of proper comparisons between merehan-, dise sold in the home market and merchandise sold in the foreign market. See Timken, 10 CIT at 95-96, 630 F.Supp. at 1336-37. Pursuant to the statute, Commerce must first select merchandise in the home market that is identical to merchandise sold in the United States. If identical merchandise is not available, then Commerce must select merchandise sold in the home market that is “approximately equal in value to the merchandise sold in the United States.” Id. at 96, 630 F.Supp. at 1336. However, Timken involved a situation where Commerce failed to consider whether the respondent provided data for the most similar merchandise. Id. at 98, 630 F.Supp. at 1338. The court’s concern in Timken was Commerce’s abdication of its responsibility to determine whether the merchandise compared was the most similar merchandise sold in the home market. Id. This is not the issue in the case at bar since Commerce used its authority to determine which model sold in the home market was the best match for the model sold in the foreign market. Commerce found a match based upon the physical characteristics of the merchandise, which is the first category in the hierarchy established by the statute for the determination of “such or similar merchandise.” Final Results, 58 Fed.Reg. at 39,765. Once Commerce finds a match, it need not consider the rest of the categories because the statute specifically directs Commerce to base its determination of what constitutes “such or similar merchandise” on the “first of the ... categories.” 19 U.S.C. § 1677(16). Once Commerce found a match and determined that over 90% of the home market sales were made at below cost, Commerce properly resorted to constructed value pursuant to 19 U.S.C. § 1677b(b) which provides the following: Whenever the administering authority has reasonable grounds to believe or suspect that sales in the home market ... have been made at prices which represent less than the cost of producing the merchandise in question, it shall determine whether, in fact, such sales were made at less than the cost of producing the merchandise. If the administering authority determines that sales made at less than . cost of production— (1) have been made over an extended period of time and in substantial quantities, and (2) are not at prices which permit recovery of all costs within a reasonable period of time in the normal course of trade such sales shall be disregarded in the determination of foreign market value. Whenever sales are disregarded by virtue of having been made at less than the cost of production and the remaining sales, made at not less than the cost of production, are determined to be inadequate as a basis for the determination of foreign market value under subsection (a) of this section, the administering authority shall employ the constructed value of the merchandise to determine its foreign market value. (Emphasis added). There is no requirement in 19 U.S.C. § 1677b(b) that Commerce first investigate whether it can make another match based on the next most similar merchandise before resorting to constructed value. Once a match was identified based on the physical characteristics of the merchandise, the fact that 90% of the matched sales were made at less than the cost of production justified Commerce’s use of constructed value. Commerce’s approach is supported by the court’s decision in Zenith Elecs. Corp. v. United States, 18 CIT -, -, 872 F.Supp. 992, 998-1000 (1994). In Zenith, the court rejected the argument that if any merchandise meeting one of the definitions of “such or similar merchandise” survives the cost of production test under 19 U.S.C. § 1677b(b), Commerce should use the actual prices of such merchandise rather than resort to constructed value. In upholding Commerce’s decision to use constructed value, the court stated the following: Once the model matches are established and the COP [cost of production] test is completed, Commerce is not required to re-examine all of the undifferentiated model data in order to make new matches and price comparisons on the basis of whatever subset of lower-ranked such or similar merchandise survives the COP test. Section 1677b(b) does not direct such a result. Zenith, 18 CIT at -, 872 F.Supp. at 1000. Accordingly, the Court sustains Commerce’s determination on this issue. 4. Inventory Carrying Costs In this review, Commerce adjusted FMV for inventory carrying costs. Final Results, 58 Fed.Reg. at 39,744. In calculating inventory carrying costs, Commerce relied upon transfer prices. Id. In addition, Commerce used the home market interest rate for the time period during which the merchandise was held by the foreign manufacturer, and the United States interest rate for when the merchandise was in transit or held by the United States affiliate. Id. Both Federal-Mogul and Torrington object to Commerce’s adjustment to FMV for inventory carrying costs. Torrington urges the Court to reconsider its decision upholding Commerce’s adjustment to FMV for inventory carrying costs as a reasonable exercise of Commerce’s discretion. Torrington’s Brief at 89 (citing Torrington Co. v. United States, 17 CIT 199, 215, 818 F.Supp. 1563, 1577 (1993)). According to Torrington, inventory carrying costs are incurred only in exporter sales price (“ESP”) transactions and .not in home market sales. Torrington’s Brief at 89-98. In support of its position, Torrington points out that 19 U.S.C. § 1677a(e) (1988) requires Commerce to deduct from ESP selling expenses incurred “by or for the account of’ the related United States importer, while no such adjustment is required in calculating home market price. Torrington’s Brief at 91. Torrington emphasizes that the adjustment made to ESP is not really for inventory carrying expenses but, rather, for financing costs incurred “for the account of’ the U.S. importer by the foreign seller. Id. at 91-92. Torrington submits that “by conceiving of the expense as ‘inventory carrying’ by the manufacturer, instead of financing costs ‘for the account of the importer, Commerce has lost sight of the foundation for its original adjustment pursuant to 19 U.S.C. § 1677a(e)(2) and made adjustments without statutory authority.” Torrington’s Brief at 92. According to Tor-rington, contrary to Commerce’s claim, an adjustment to home market price for inventory carrying costs does not result in a fair “apples to apples” comparison. Id. at 94-98. Federal-Mogul argues that Commerce’s approach is flawed because Commerce applies inconsistent values and rates in the calculation of inventory carrying costs. Federal-Mogul’s Brief at 14-21. Federal-Mogul contends that transfer prices should not be used in calculating the adjustment to FMV because such prices are inherently suspect. Id. at 16. Federal-Mogul further asserts that there is no relation between the price of the merchandise when it is eventually sold and the cost of holding such merchandise prior to sale. Id. at 17. Accordingly, Federal-Mogul submits that Commerce improperly relies on sale prices instead of actual costs incurred in the home market to determine pre-sale costs. Id. Finally, citing LMI-La Metalli Industriale, S.p.A. v. United States, 912 F.2d 455 (Fed.Cir.1990), as authority, Federal-Mogul maintains that Commerce should eliminate variations in the adjustments due to the interest rates employed. Federal-Mogul’s Brief at 18-21. Federal-Mogul proposes that Commerce apply to both the home market and the United States market the lowest interest rate found in either market. Id. at 18-19. Commerce urgés the Court to adhere to its decision in Torrington, 17 CIT at 215, 818 F.Supp. at 1577, upholding Commerce’s practice of adjusting FMV for pre-sale home market inventory carrying costs. Commerce’s Brief II at 49-51. According to Commerce, the adjustment to FMV results in an “apples to apples” comparison of merchandise sold in two markets at a common point in the distribution channel. Id. at 52. Commerce further claims that the general language of 19 U.S.C. § 1677a(e)(2) gives Commerce the authority to deduct inventory carrying costs from FMV. Id. at 54. Commerce agrees with Federal-Mogul, however, that this case should be remanded to Commerce to reconsider whether it should recalculate inventory carrying costs using actual costs of the merchandise rather than transfer prices and whether it should apply uniform interest rates. Id. at 55; Commerce’s Brief I at 18-19. The defendant-intervenors disagree with Commerce, however, and believe that Commerce properly calculated the inventory carrying costs. NTN and FAG cite Timken Co. v. United States, 18 CIT -, -, 865 F.Supp. 881, 886-87 (1994), to argue that the Court has upheld Commerce’s methodology with respect to the interest rates applied. NTN’s Brief I at 8-9; FAG’s Brief I at 21. The defendant-intervenors also assert that LMI-La Metalli does not support Federal-Mogul’s contentions. See, e.g., Emerson’s Brief at 4-5. INA Walzlager Schaeffler KG and INA Bearing Company, Inc. (“INA”) maintain that Federal-Mogul’s proposed methodology is inconsistent with normal commercial practice. Response of Defendant-Intervenors INA Walzlager Schaeffler KG and INA Bearing Company, Inc. to Plaintiff Federal-Mogul Corporation’s Motion for Judgment Upon the Agency Record at 6. Finally, SKF USA Inc., SKF France S.A., SKF GmbH, SKF Industrie, S.pA. and SKF Sverige AB (collectively “SKF”) maintain that a remand is inappropriate because Commerce has failed to demonstrate the calculations are unsupported by substantial evidence or otherwise not in accordance with law. Brief of SKF in Opposition to Federal-Mogul Corporation’s Motion for Judgment Upon the Agency Record (“SKF’s Brief I ”) at 46-51. The CAFC has upheld Commerce’s decision to deduct inventory carrying costs from FMV as an indirect selling expense. Torrington Co. v. United States, 44 F.3d 1572, 1580-81 (Fed.Cir.1995). Specifically, the CAFC stated the following: ITA’s practice of deducting inventory carrying costs, measured from the production date, from exporter’s sales price and foreign market value comports with section 1677a(e)(2) and regulation 358.56(b)(2). This practice also affords a true “apples-to-apples” comparison. The opportunity cost of holding inventory accrues from the production date and applies to both export and home market sales. ITA may fairly treat this opportunity cost as an indirect selling expense and, thus, deduct it from exporter’s sales price and foreign market value. Torrington, 44 F.3d at 1580 (citations omitted). Thus, this Court rejects Tomngton’s arguments and upholds Commerce’s practice of deducting inventory carrying costs from FMV. The next issue is whether Commerce’s methodology for computing inventory carrying costs is proper. In defending its methodology, Commerce stated the following in the Final Results: Inventory carrying cost measures the imputed cost incurred by the firm for storing AFBs in inventory. The transfer price reflects the cost of the merchandise as it is entered into inventory and therefore is' an accurate basis upon which to calculate the cost to the subsidiary of holding inventory prior to the sale to an unrelated U.S. customer. We cannot calculate actual cost for inventory carrying costs since these costs are not found in the books of the respondents. Thus, we must look at what the financing cost would have been. The Department’s practice in calculating inventory carrying costs for ESP sales is to calculate the cost in two segments-one during which the merchandise is held by the foreign manufacturer and the other when the merchandise is in transit or held by the U.S. affiliate. Because the seller incurs the opportunity cost of holding inventory in both markets, and because we adjust for that cost in the U.S. market, we must also adjust for the same cost in the home market. In calculating such an expense, we must use the appropriate interest rate (i.e., the home market interest rate on the home market side and the U.S. interest rate for the U.S. side). 58 Fed.Reg. at 39,744. In LMI-La Metalli the CAFC held that imputed interest rates' must conform to commercial practice. 912 F.2d at 460. Specifically, the CAFC rejected Commerce’s assertion that its methods do not have to conform to commercial practice by stating the following: This position is internally inconsistent ... because the imputation of credit cost itself is a reflection of the time value of money, and hence commercial practice. The time value of money is not an arbitrary fiction, but must correspond to a dollar figure reasonably calculated to account for such value during the gap period between delivery and payment. If the cost of .credit is imputed in the first instance to conform with commercial reality, it must be imputed on the basis of usual and reasonable commercial behavior. Id. The explanation provided by Commerce in the Final Results fails to establish that the imputed interest rate conforms to commercial reality. Commerce does not cite any evidence to support its presumption that to finance inventory carrying costs, the foreign manufacturer and United States affiliate would each borrow at separate interest rates. The Court has upheld Commerce’s practice of applying separate interest rates based on a specific set of facts. See Timken Co., 18 CIT at -, 865 F.Supp. at 886-87. In Timken Co., the foreign company permitted its subsidiary to pay months after the shipment of merchandise and, therefore, the Court found it was reasonable to apply the interest rate of the foreign country since the foreign company incurred. lost opportunity expenses. Id. In the review at issue, Commerce does not cite any specific facts concerning delayed payments. If such facts exist, then Commerce may determine that its approach was reasonable. However, absent such circumstances, Commerce may determine on remand that it should apply a uniform interest rate. As such, the Court agrees that a remand is appropriate for Commerce to reconsider this issue. Furthermore, Commerce does not provide adequate reasons for its decision to rely upon transfer prices as opposed to actual costs. There is no evidence that transfer prices, which generally are less rehable than actual cost data, represent the cost of carrying inventory. See Aimcor, Alabama Silicon, Inc. v. United States, 18 CIT -, -, 871 F.Supp. 455, 460-61 (1994) (noting that Commerce may rely on transfer prices to determine cost of production where the use of actual cost data is nearly impossible, and when Commerce verifies that the reported transfer prices are “sound and rehable”). Accordingly, on remand, Commerce should reconsider its reliance on transfer prices in computing inventory carrying costs. 5. Methodology far Selecting Similar Merchandise In the review at issue, Commerce used the following methodology to determine what constitutes “similar merchandise” for the purpose of price comparisons between the home market and the United States market: Pursuant to sections 773(a)(1) and 771(16) of the Tariff Act, our model match methodology first attempts to match a bearing sold in the United States with identical bearings sold in the home market. If we fail to find an identical bearing, we then attempt to match a bearing sold in the United States with “similar” bearings, i.e., bearings within the same “family,” sold in the home market. If we fail to find a similar match, we will match a bearing sold in the United States with its constructed value pursuant to section 773(a)(2) of the Tariff Act. Final Results, 58 Fed.Reg. at 39,764. Commerce determined what constituted “similar merchandise” by grouping bearings into families based upon eight defined physical characteristics. Commerce also employed a 20% difiner cap so that bearings having a greater than 20% difference in their variable costs would not be treated as “similar.” Id. Federal-Mogul and Torrington both object to Commerce’s use of the family model match methodology. Federal-Mogul’s Brief at 21-25; Torrington’s Brief at 69-78. Torrington contends that Commerce’s definition of “similar merchandise” is unreasonably narrow and resulted in the inappropriate use of constructed value when sales comparisons could have been made. In support of its position, Torrington notes that the antidumping statute prefers sales comparisons to constructed value comparisons. Torrington’s Brief at 69-71. Federal-Mogul specifically objects to the application of the family model match methodology to Meter since Commerce’s approach resulted in no matches. Federalr-Mogul’s Brief at 21-25. Commerce defends its use of the family model match methodology as an effective means of organizing matches. Commerce’s Brief II at 33-43. Commerce emphasizes that it has broad discretion in determining what constitutes “similar merchandise.” Id. at 36-37. Commerce also points out that all interested parties had numerous occasions to comment on Commerce’s methodology and that Commerce considered all comments 'before concluding that the family approach is reasonable. Commerce explains that it relied on comments of interested parties to develop the family model match methodology in which Commerce compares certain physical characteristics to determine when United States and home market AFB models are “similar” for price comparison purposes. Id. at 42. Commerce urges the Court to find that this methodology is reasonable and within its discretion. Defendant-intervenors agree with Commerce’s use of the family model match methodology. See, e.g., Brief of SKF in Opposition to The Torrington Company’s and Federal Mogul Corporation’s Motions for Judgment Upon the Administrative Record (“SKF’s Brief II”) at 59-74. In Torrington, 19 CIT at -, 881 F.Supp. at 635, the Court upheld Commerce’s family model match methodology. In rejecting identical arguments to the ones presented in the case at bar, the Court stated: The issue herein is not whether Commerce’s model match methodology gives a broad or narrow construction to the term “similar” merchandise. The issue is whether that methodology is supported by substantial evidence and is otherwise in accordance with law. This Court finds that Commerce’s model matching methodology was within the broad discretion it is granted to determine- “similar merchandise.” Torrington has not provided any evidence of unreasonable behavior on the part of Commerce. Id. The Court adheres to its prior decision and finds that Commerce’s use of the family model match methodology, including its application to Meter, is in accordance with law and supported by substantial evidence. 6. Meter’s United States Warranty Expenses In this review, Commerce found Meter’s allocation of total U.S. warranty expenses over total U.S. sales value to be reasonable. Final Results, 58 Fed.Reg. at 39,743. Federal-Mogul objects to this determination arguing that warranty costs identifiable to one customer’s purchases should be allocated only over that customer’s purchases with the remainder allocated over all U.S. sales. Fed-eralr-Mogul’s Brief at 25-27. Federal-Mogul emphasizes that warranty costs are direct selling expenses and that Meter identified warranty expenses for a specific customer. Id. at 26-27. In rebuttal, Commerce notes that warranty expenses for merchandise sold during the period of review are actually incurred and identified after the period of review. As such, Commerce explains that warranty expenses incurred during the period of review are estimated using surrogate warranty costs. Commerce’s Brief I at 27-28. Although Commerce recognizes that Meter reported repair expenses for a particular United States customer prior to the period of review, Commerce claims that these expenses are not necessarily reflective of the warranty expenses incurred on sales made during the period of review. Id. at 29-30. Absent data concerning what proportion of warranty expenses were historically attributable to each particular customer, Commerce claims that there is no support for a presumption that warranty expenses linked with sales made to a particular customer prior to the period of review are a reasonable approximation of warranty costs incurred on behalf of the same customer during the period of review. Id. at 30-32. In response, Federal-Mogul claims that Meter’s reporting of repair expenses made to a particular customer over a three year period qualifies as historical data showing a pattern of warranty expenses attributable to sales to a particular customer.. Federah-Mogul Corporation’s Reply to the Responses to Federal-Mogul Corporation’s Motion for Judgment Upon the Agency Record at 20-21. Federal-Mogul does not contest Commerce’s decision to accept Meter’s methodology in general but does so with respect to one specific customer. In its response to Commerce’s questionnaire, Meter reported repair expenses incurred on behalf of one specific customer during the three years pri- or to the period of review. See Response to Questionnaire Section B (“Meter’s Response”), C.R. Document No. 6, Fiche 74, Frames 51-52. Meter reported its warranty expenses incurred during the period of review by dividing total United States warranty expenses by total United States sales value. See Meter’s Response, C.R. Document No. 6, Fiche 74, Frame 52. In light of the fact that the majority of the warranty expenses- reported for the specific customer were not incurred during the period of review, Commerce properly refused to rely on this data to calculate the warranty expenses incurred during the period of review. See Final Results, 58 Fed.Reg. at 39,743. It is reasonable for Commerce to conclude that expenses incurred during the three years prior to the review may not be representative of the expenses incurred during the period of review. As such, the Court finds that Commerce’s methodology of allocating warranty costs by dividing total U.S. warranty expenses by total U.S. sales value was reasonable and in accordance with law.. 7. Allocation of NSK’s Indirect Expenses Federal-Mogul asserts that Commerce erred in its calculation of USP by failing to reallocate NSK’s claimed advertising expenses.' Federal-Mogul’s Brief at 27-29. Federal-Mogul claims that NSK improperly allocated its advertising expenses over total sales rather than over total sales value for original equipment manufacturer (“OEM”) customers only. In support of its position, Federal-Mogul cites NSK’s questionnaire response which states that advertising promotes NSK’s products to OEM customers. Id. at 27-28. Commerce agrees that it erred in allocating NSK’s advertising expenses over total sales when the record demonstrates that such expenses were incurred to promote products to OEM customers only. Commerce’s Brief I at 32-34. Accordingly, Commerce requests a remand to reallocate NSK’s United States indirect advertising expenses. NSK, defendant-intervenor, asserts that Commerce should not reallocate NSK’s advertising expenses. To support its position, NSK states that the advertisements' are clearly intended to promote NSK to all end-users and that it would be impossible for NSK to limit the readership of the publications to OEM customers only. Memorandum of Points and Authorities in Opposition to Plaintiff’s Motion for Judgment on the Agency Record at 18-19. In the Final Results, Commerce did not limit the allocation of NSK’s indirect advertising expenses to its sales to United States OEM customers. 58 Fed.Reg. at 39,-742. In its questionnaire response,. NSK specifically acknowledged that advertising expenses are designed “to promote all products of NSK to OEM customers.” Response of NSK Ltd. and NSK Corporation to Section B of the Questionnaire, P.R. Document No. 143, Fiche 62, Frame 14. Furthermore, NSK stated that sales to distributors are only for the aftermarket in the United States. Response of NSK Ltd. and NSK Corporation to Supplemental Questionnaire for Sections A through C, P.R. Document No. 301, Fiche 114, Frame 37. In light of the purpose of the advertising expenses, the Court agrees that a remand is necessary for Commerce to reallocate NSK’s advertising expenses over total sales to OEM customers only. 8. Use of Below-Cost Sales for Calculation of Profit Torrington contends that Commerce improperly included below-cost sales in its calculations of profit for use in constructed value. Torrington’s Brief at 57-65. In support of its position, Torrington asserts that below-cost sales are outside the ordinary course of trade. Id. at 59-60. Torrington points out that below-cost sales are excluded from the calculation of FMV in certain situations pursuant to 19 U.S.C. § 1677b(b). Torrington urges the Court to exclude below-cost sales in situations where constructed value serves as FMV be :ause failure to do so distorts the statutory scheme. Id. at 58-59. In the alternative, Torrington argues that Commerce should have calculated constructed value based on the reported sample sales of such or similar merchandise rather than on class or kind of merchandise. Torring-ton’s Brief at 65-68. Torrington asserts that the sample group of home market sales is representative of the profit on sales of the general class or kind of merchandise. Id. at 66. Accordingly, Torrington objects to the use of the eight percent statutory minimum where profit figures based upon the sample sales of such or similar merchandise were higher than eight percent. Id. at 67. Tor-rington states that Commerce should have presumed that profit based on the reported sales of such or similar merchandise would be representative of the profit for the general class or kind of merchandise. Id. at 67-68. Commerce responds that the inclusion of below-cost sales in its profit calculations is consistent with 19 U.S.C. § 1677b(e)(l)(B) (1988). Commerce’s Brief II at 25-26. Commerce points out that the plain language of the statute does not require the exclusion of below-cost sales when determining a profit amount for constructed value. Commerce rejects Torrington’s claim that below-cost sales are per se outside the ordinary course of trade explaining that Commerce considers a variety of circumstances in determining whether home market sales are outside the ordinary course of trade. Id. at 27. According to Commerce, Torrington failed to provide evidence demonstrating that the below-cost sales were outside the ordinary course of trade. Id. Commerce further responds that pursuant to 19 U.S.C. § 1677Í-1 (1988), it has broad discretion to determine when sampling techniques are appropriate. Id. at 31-32. Commerce argues that its determination that the reported sample of such or similar merchandise is not representative of the class or kind of merchandise is a reasonable exercise of its discretion. Id. at 32-33. This Court has already determined that 19 U.S.C. § 1677b does not require the exclusion of below-cost sales when determining the profit amount in calculating constructed value. Torrington, 19 CIT at --, 881 F.Supp. at 633. In order for below-cost sales to be excluded, it must be shown that the sales were made outside the ordinary course of trade. Id. In Torrington, the Court noted that Commerce’s determination of whether an importer’s sales are in the ordinary course of trade is entitled to deference and that the plaintiff bears the burden of demonstrating the sales Commerce included in its FMV calculation were outside the ordinary course of trade. Id. The Court concluded that “[t]he statutory language and structure support Commerce’s determination that below-cost sales are not automatically excluded from the calculation of profit in determining constructed value.” Id. Thus, because Torrington has failed to present any evidence in this case that the below-cost sales at issue were outside the ordinary course of trade, this Court finds Commerce’s inclusion of the below-cost sales in its calculation of profit for constructed value to be reasonable and in accordance with law. Torrington’s alternative argument is also without merit. In asserting that Commerce should have calculated constructed value based upon the reported sample sales of such or similar merchandise, Torrington misconstrues the meaning and purpose of 19 U.S.C. § 1677f-l which states the following: For the purpose of determining United States price or foreign market value under sections 1677a and 1677b of .this title, and for purposes of carrying out annual reviews under section 1675 of this title, the administering authority may— (1) use averaging or generally recognized sampling techniques whenever a significant volume of sales is involved or a significant- number of adjustments to prices is required, and (2) decline to take into account adjustments which are insignificant in relation to the price or value of the merchandise. (b) Selection of samples and averages The authority to select appropriate samples and averages shall rest exclusively mth the administering authority; hut such samples and averages shall be representative of the transactions under investigation. (Emphasis added). The statute explicitly grants Commerce the authority to select the appropriate samples as long as the samples are “representative of the transactions under investigation.” 19 U.S.C. § 1677f-l. In addition, the Court has consistently recognized that Commerce has been given broad discretion in its sample selection methodology. Nachi-Fujikoshi Corp. v. United States, 19 CIT -, -, 890 F.Supp. 1106, 1109 (1996); see also GMN Georg Muller Nurnberg AG v. United States, 15 CIT 174, 179, 768 F.Supp. 607, 612 (1991); Asociacion Colombiana de Exportadores de Flores v. United States, 13 CIT 13, 20-22, 704 F.Supp. 1114, 1120-22 (1989), aff'd, 901 F.2d 1089 (Fed.Cir.), cert. denied, 498 U.S. 848, 111 S.Ct. 136, 112 L.Ed.2d 103 (1990). If Commerce has broad discretion in choosing a sample methodology, then Commerce should also have discretion to decide not to use samples. The purpose of 19 U.S.C. § 1677f-l is to permit Commerce to use sampling methodologies when necessary due to the volume of sales involved. The legislative history clarifies the purpose of § 1677Í-1 as being “to reduce the costs and administrative burden on the Department of Commerce of determining dumping mar-gins_” H.R.Rep. No. 725, 98th Cong.2d Sess. 46 (1984), reprinted in 1984 U.S.C.C.A.N. 4910, 5173. There is no support in either the statute or the legislative history for Torrington’s claim that Commerce is required to use samples. In fact, Commerce’s authority to use samples is limited by the requirement that the samples be representative of the transactions under investigation. See 19 U.S.C. § 1677f-l. As such, Commerce’s decision not to rely on the samples for calculating constructed value based on its determination that the sample sales were not representative of the transactions under investigation, is reasonable and in accordance with law. 9. Calculation of Cash Deposit Rates In this review, Commerce used two different methodologies to calculate assessment rates and cash deposit rates. To determine assessment rates for ESP sales, Commerce divided the total amount of potential uncollected dumping duties (“PUDD”) for the reviewed sales by the total entered value of those sales. Final Results, 58 Fed.Reg. at 39,732. To calculate cash deposit rates, Commerce divided each exporter’s PUDD by the total net USP for that exporter’s sales under each dumping order during the period of review. Commerce then used weighted-averages to arrive at a single deposit rate for each class or kind of merchandise for each exporter included in the review. 58 Fed. Reg. at 39,731-32. Although Torrington concedes that this Court has consistently upheld Commerce’s methodology for calculating cash deposit rates, Torrington still insists that Commerce erred. Torrington’s Brief at 79. Torrington contends that the statute requires the assessment rate to equal the cash deposit rate in order for Commerce to collect the correct amount of antidumping duties. Torrington’s Brief at 79-88. Torrington also argues that Commerce’s decision to use total USP instead of entered value data results in the undercolleetion of antidumping duties. Id. at 8<U87. Commerce responds that the statute does not specify the manner in which Commerce must calculate cash deposit rates. As such, Commerce contends that its methodology is a reasonable exercise of its discretion and that this Court should continue to sustain its practice. Commerce’s Brief II at 43-46. The CAFC recently upheld Commerce’s methodology for determining cash deposit rates. Torrington, 44 F.3d at 1578-79. Specifically, in upholding Commerce’s methodology, the CAFC stated the following: Section 1675(a)(2) does not require the same method of calculation for assessment rates and cash deposit rates. Nor does it specify a particular divisor when calculating either assessment rates or cash deposit rates. Rather, the statute merely requires that PUDD, the difference between foreign market value and United States price, serve as the basis for both assessed duties and cash deposits of estimated duties. ITA based its calculation of both rates on PUDD. Thus, ITA’s use of different methods for calculating these rates does not conflict with the statute. Id. at 1578. Furthermore, the CAFC held that “[n]o evidence compels [a finding] that deriving cash deposit rates from entered values leads to a more accurate estimation of future duties than reliance on total United States price.” Id. at 1579. In light of the decision of the CAFC, the Court finds that Commerce’s method for calculating cash deposit rates is in accordance with law. 10. Pre-Sale Inland Freight Expenses In the review at issue, Commerce deducted pre-sale inland freight expenses from FMV. Final Results, 58 Fed.Reg. at 39,768. Torrington objects to this deduction claiming that it is inconsistent with the decision of the CAFC in Ad Hoc Comm. of AZ-NM-TX-FL Producers of Gray Portland Cement v. United States, 13 F.3d 398 (Fed.Cir.1994), reh’g, en banc, denied, 1994 U.S.App. LEXIS 16258 (Fed.Cir. March 1, 1994), and cert. denied, — U.S. -, 115 S.Ct. 67, 130 L.Ed.2d 23 (1994). Torrington’s Brief at 108-11. According to Torrington, the Ad Hoc decision applies to all FMV calculations, as opposed to only purchase price situations, and prohibits Commerce from deducting pre-sale movement expenses from FMV. Torrington’s Brief at 109-10. Torrington requests a remand for Commerce to recalculate FMV without any deduction for pre-sale freight expenses. Id. at 111. Commerce agrees with Torrington that a remand is necessary in light of the CAFC decision in Ad Hoc rejecting Commerce’s practice of deducting pre-sale movement expenses from FMV. Commerce’s Brief II at 58-59. Defendant-intervenors disagree with Tor-rington and Commerce arguing that the decision in Ad Hoc is limited to purchase price situations. See, e.g., SKF’s Brief II at 141-148. In Torrington Co. v. United States, 68 F.3d 1347, 1352-56 (Fed.Cir.1995), the-CAFC limited the application of Ad Hoc to situations in which USP is calculated based on purchase price as opposed to ESP. The Court specifically held that Commerce may deduct indirect selling expenses, including pre-sale transportation expenses, from FMV pursuant to the ESP offset permitted by 19 C.F.R. § 353.56(b)(2). Id.; see also Torrington, 19 CIT at -, 881 F.Supp. at 638. Thus, Commerce may deduct pre-sale inland freight expenses from FMV when USP is calculated on the basis of ESP. As it is not clear to this Court whether FMV was calculated in this case using purchase price or ESP, the Court remands this issue to Commerce to deny the adjustment to FMV for pre-sale home market transportation expenses only where FMV was calculated using purchase price. 11. Treatment of Resale Profit Torrington asserts that Commerce erred in refusing to deduct profit on resale transactions from ESP. Torrington urges the Court to depart from its prior decisions arguing that although the statute is silent on the issue, legislative history supports Torring-ton’s contention that Commerce is required to deduct reseller profit in ESP calculations. Torrington’s Brief at 113-15. Torrington further argues that Commerce’s approach results in an artificial inflation of USP. Id. at 115-16. In rebuttal, Commerce maintains that the Court should adhere to its prior decisions upholding Commerce’s practice of not deducting reseller profit from ESP. Commerce’s Brief II at 59-65. The CAFC has affirmed this Court’s decision holding that neither the statute nor the legislative history supports the position that Commerce is required to deduct resale profit from ESP. Timken Co. v. United States, 37 F.3d 1470, 1478 (Fed.Cir.1994). Section 1677a(e) sets forth the adjustments to ESP as follows: For purposes of this section, the exporter’s sales price shall also be adjusted by being reduced by the amount, if any, of— (1) commissions for selling in the United States the particular merchandise under consideration. 19 U.S.C. § 1677a(e)(l) (1988) (emphasis added). The CAFC found that the meaning of the word “commissions” as used in the statute and the legislative history does not include profits and, therefore, Commerce is not required to consider profits in calculating ESP. Timken Co., 37 F.Bd at 1478. Thus, the Court sustains Commerce on this issue. 12. Home Market Rebates, Discounts and Billing Adjustments Torrington objects to Commerce’s treatment of price adjustments which were not reported on a transaction- or product-specific basis as indirect expenses. Torrington contends that home market rebates, discounts and billing adjustments that are not linked to individual transactions should be rejected rather than treated as indirect expenses. Torrington’s Brief at 118-29. Torrington submits that Commerce’s approach eliminates the incentive for respondents to provide Commerce with actual sale-by-sale expense information. Id. at 126. Torrington cites a prior decision by this Court remanding this issue to Commerce “to develop a methodology which removes [post-sale price adjustments] and rebates paid on sales of out of scope merchandise from any adjustments made to FMV for [post-sale price adjustments] or rebates or, if no viable method can be developed, to deny such an adjustment in its calculation of FMV.” Torrington, 17 CIT at 218, 818 F.Supp. at 1679. Torrington’s objections pertain to Commerce’s treatment of price adjustments reported by NSK, Koyo and SKF. Id. at 119-25. In the case of NSK, Torrington submits that it was improper for Commerce to permit adjustments for NSK’s discounts without evidence that NSK reported the discounts on a product-specific basis. Id. at 119-20. Tor-rington asserts that even though NSK did not report transaction-specific post-sale price adjustments, Commerce treated these adjustments as indirect expenses. Id. at 120-21. Torrington raises similar objections with respect to Commerce’s treatment of Koyo’s post-sale price adjustments which were reported based on customer-specific allocations rather than based on actual price adjustments made for each transaction. Id. at 121-22. In addition, Torrington notes that SKF’s cash discounts were reported on neither a transaction- nor product-specific basis. Id. at 123-24. Finally, Torrington claims that Commerce should have eliminated, as pertaining to out-of-scope merchandise, SKF’s billing adjustments, which were not tied to specific in-scope sales transactions. Id. at 124-45. Commerce agrees that, in light of the Court’s decision in Torrington, a remand is necessary so that Commerce may determine whether the adjustments at issue may be allocated without including rebates and adjustments paid upon out of scope merchandise or, if Commerce cannot make such an allocation, then to deny the adjustments. Commerce’s Brief II at 65. Defendant-intervenor NSK argues that Commerce properly allowed adjustments for NSK’s discounts and rebates. NSK contends that Commerce confirmed at verification that the discounts and rebates reported by NSK were related to scope merchandise. Memorandum of Points and Authorities in Opposition to Motions for Judgment on the Agency Record (“NSK’s Brief II”) at 42-45. Defendant-intervenor SKF asserts that Commerce’s treatment of SKF’s discounts and billing adjustments was proper. To support its argument, SKF submits that its cash discounts were calculated and reported based on specific transactions in which customers were entitled to discounts. SKF’s Brief II at 162-67. SKF admits that it could not trace discount payments to specific transactions, but explains that it used eustomer-number-specific payment terms which were applied on a transaction-specific basis to calculate cash discounts for eligible transactions. Accordingly, SKF claims that the discounts were n