Hagen Advertising Displays, Inc. v. Commissioner
United States Tax Court
Petitioner is in the business of manufacturing advertising signs. Many of its larger customers place "blanket orders" for several signs, with delivery to be made one by one over future months as directed by the customer. Some of these customers pay in advance for all of the signs ordered, and no restrictions are placed on petitioner's use of these customers' advances.
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Petitioner is in the business of manufacturing advertising signs. Many of its larger customers place "blanket orders" for several signs, with delivery to be made one by one over future months as directed by the customer. Some of these customers pay in advance for all of the signs ordered, and no restrictions are placed on petitioner's use of these customers' advances. Petitioner in computing its taxable income for the years here in issue and for prior years did not include the amounts of these advances in income until the year in which the signs for which the advance payments were made were…
1Dissent
IIoyt, </.,
dissenting: I cannot agree with the majority opinion and wish to record my dissent. The evidence here convinces me that respondent’s determination exceeds permissible limits because it taxes gross receipts rather than the gain from the sale of goods, which gain alone is income subject to taxation. I would also hold that the petitioner’s method of accounting clearly reflected its net income for the years 1960 and 1962 whereas the respondent’s determination is erroneous, arbitrary, and clearly distorts income.
Petitioner computes its cost of goods sold according to elementary…
2Cases cited16 opinions
- North American Oil Consolidated v. BurnetSupreme Court of the United States · 1932
- Commissioner v. WilcoxSupreme Court of the United States · 1946
- American Automobile Assn. v. United StatesSupreme Court of the United States · 1961
- Schulde v. CommissionerSupreme Court of the United States · 1963
- Sullenger v. CommissionerUnited States Tax Court · 1948
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