Borden Manufacturing Co. v. Commissioner

*278OPINION.

Littleton :

The Board is unable from the evidence to determine the amount of the deduction, if any, to which petitioner is entitled for 1918 and 1919 in respect of the steam power machinery and equipment as a result of the change from steam to electric power. We have no evidence of the original cost or the fair market price or value of the equipment on March 1, 1913. Petitioner’s witnesses testified that the fair market value of the steam power machinery and equipment in each of the mills at the time electric power was substituted therefor in 1918 and 1919 was $23,274.50 and $21,788.65, respectively. In the absence of evidence of the cost or the value on March 1, 1913, the Commissioner’s determination in this regard must be approved.

It is claimed that the Commissioner’s allowance for exhaustion, wear and tear of the buildings and machinery was inadequate and that a greater allowance should be made for each of the taxable years. We have no evidence as to what allowance the Commissioner made for this purpose, nor is the evidence sufficient to enable the Board to make any determination in regard to the proper allowance.

The state and county taxes amounting to $3,564.17, which accrued during 1918, were disallowed by the Commissioner because they were paid in 1919. No entry was made upon the books for 1918 in respect thereto. Petitioner followed the accrual method of accounting and the accrued tax was a proper deduction for 1918, notwithstanding the amount thereof was not entered upon the books for that year. See Russell Milling Co., 1 B. T. A. 194, and Atlantic Coast Line R. R. Co., 2 B. T. A. 892.

Judgment will he entered on 15 days’ notice, under Bule 50.