H. S. Crocker Co. v. Commissioner
United States Board of Tax Appeals
1. INVESTED CAPITAL. - Petitioner acquired the assets and liabilities of a profitable business for stock and cash after agreement upon the values of the various items transferred.
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1. INVESTED CAPITAL. - Petitioner acquired the assets and liabilities of a profitable business for stock and cash after agreement upon the values of the various items transferred. The actual cash values of the assets for purposes of invested capital and also for the computation of depreciation, are determined to be the values agreed upon for the sale rather than an appreciation of petitioner's book values based upon an appraisal. 2. INCOME. - Petitioner acquired accounts receivable at an agreed cost which was set up on its books, together with a reserve for losses. Upon collection or charging…
1Opinion of the Court
*180OPINION.
Trussell:
The first issue involves primarily the question of fact as to the value of certain assets for the purpose of invested capital. As of March 31, 1919, petitioner acquired the going business of a predecessor corporation in consideration of cash and its capital stock at par, totaling $1,082,645.35. The predecessor corporation had been in business for a good many years and had built up a large and profitable business, but in 1919 its stockholders desired to retire from active business. On March 19, 1919, the parties in interest entered into a contract for the sale of the…
2Cited by1 opinion
- H. S. Crocker Co. v. CommissionerUnited States Board of Tax Appeals · 1929