Commissioner v. Drovers Journal Pub. Co.

KERNER, Circuit Judge.

This is a petition to review a decision of the Tax Court involving respondent’s income taxes for the year 1937.

There is no dispute as to the facts. Respondent is engaged in the publishing and radio broadcasting business. It has kept its books and made its tax returns on the accrual basis. During and prior to 1937 its total capital stock was owned by Corn Belt Publishers, Inc. November 1, 1937, Corn Belt had outstanding common and $400,000 of 7% cumulative preferred stock, on which no dividends had been paid for a number of jears.

November 1, 1937, respondent submitted to…