Manville Jenckes Co. v. Commissioner
United States Board of Tax Appeals
1. Under the facts stated, held, that cash received through the issuance of "convertible notes" may be included in invested capital.
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1. Under the facts stated, held, that cash received through the issuance of "convertible notes" may be included in invested capital. Appeal of Middleton Compress & Warehouse Co.,1 B.T.A. 1145. 2. In determining the net income of the taxpayer for the fiscal year ended June 30, 1917, subject to the additional normal tax of 4 per cent provided by the Revenue Act of 1917, the excess-profits tax should be credited against the net income for the entire fiscal year, and that proportion of the remainder which the portion of the fiscal year falling in the calendar year 1917 bears to the entire fiscal…
1Opinion of the Court
*784OPINION.
MoRRis:
The first question presented by the record in this appeal is what part, if any, of the amount of $750,000 received by the taxpayer prior to March 31, 1917, from the issuance of its “ convertible notes,” should be included in its invested capital for the fiscal year ended June 30, 1917. The evidence establishes that on and.prior to July 1, 1916, the taxpayer needed additional capital and that it was decided by its officers to issue additional preferred stock in the amount of $750,000 as soon as the necessary authority therefor could be obtained from the Legislature of Rhode…
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