The opinion
Arundell :
The respondent found a deficiency of $205.88 in income and excess-profits taxes for the year 1919, in connection with which it is claimed he erred in the computation of invested capital for 1918.
FINDINGS OF FACT.
The petitioner, a New York corporation, with principal offices at 50 Court Street, Brooklyn, N. Y., was organized in 1910 with a capital stock of $1,000. Its activities were confined almost exclusively to the purchase and sale of real estate. The books of account of the petitioner consisted of cards on which entries were made for each purchase of property.
At December 31, 1917, the petitioner owned eight pieces of real estate. The cost of, and outstanding mortgage, on each property, together with the petitioner’s equity therein at the close of 1917, were as follows:
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In the year 1917 the petitioner made a profit of $544. “ Loans payable ” at the close of 1917 amounted to $7,694.60.
Respondent’s determination of invested capital for the year 1919 was based on invested capital at January 1, 1918, of $18,655.40.
Judgment will he entered for the re.s'pondent.