Appeal of Delaware Trucking Co.

*1212OPINION.

The Commissioner does not contest any item except the part of the $15,000 paid in stock for the Munice Co. business in excess of the $6,300 allowed by him as the value of the tangible assets. Taxpayer claims the other $8,700 as the value.of good will purchased. The Commissioner denies that there was any valuable good will.

An analysis of the facts in this appeal discloses that no evidence was submitted in regard to the value of the good will included in the assets of the Muncie Co.

It will be noted that the Delaware Trucking Co., with a capital stock of $10,000 from 1913 to 1919, a period of six years, accumu*1213lated a surplus of $25,000; that is, an average of $5‘,000 per annum, equal to 50 per cent per annum. After the purchase of. the Muncie Co., and after the increase of capital stock to $50,000, it declared a dividend of 12 per cent the first -year, 8 per cent the second year. 12 per cent the third year, and 24 per cent the fourth year, ah average of 14 per cent; that is, an average of $7,000 per.annum. There was no evidence of prior earnings of the Muncie Co. i ! . ¡

It is true that, by taking over the business i of the Muncie Co., the taxpayer may have- acquired some of the former business and patronage of that company which had a value aside from the tangible assets, but the evidence is too indefinite to fix a value. The burden is upon the taxpayer to establish the actual cash value of the intangible property, but it has failed to furnish sufficient factors upon which we can make a determination of such value, so we must approve the determination of the Commissioner.

Order of redetermination will he entered on 15 days’ notice, wider Bule 50.