
    J. H. Carmichael, Petitioner, v. Commissioner of Internal Revenue, Respondent.
    Docket No. 12493.
    Promulgated June 7, 1928.
    
      T. B. Wier, Esq., and F. S. Jacobsen, G. P. A., for the petitioner.
    
      J. E. Marshall, Esq., for the respondent.
   OPINION.

Love:

The first issue arose from the duplication of an item in the 1918 income, which respondent’s counsel admitted was in error, A correction should be made accordingly. The other issue is the value of sheep in inventory at the close of the year. There were two expert witnesses on values — the petitioner, in his own behalf, and another expert sheepman on behalf of the respondent. The latter was of the opinion that ewes from 1 to 4 years old were worth $15 per head. This opinion was based partly on sales of yearlings made by him in August to October, 1918, at $15.50. He did not give, and was not asked his opinion of the value per head of a band of sheep of this size, grade and quality, of ages ranging from 1 to 8 years. It was not disputed that a ewe was of highest value in the second j^ear. The evidence indicates that value varies with the age, and there is a gradual decline after the second year. This witness had bought 8-year olds in the fall of 1918 at 5 cents a pound, or about $5.50 per head. The petitioner’s opinion was that the average value was $10. Upon all of the testimony before us, we think that the latter figure is correct for this band of ewes.

Petitioner valued the ewe lambs at $7, and the wethers at $6. Upon a consideration of the evidence, we believe they were worth $8 and $7 per head, respectively, and have found accordingly. No testimony was offered as to the value of bucks.

The statement annexed to the deficiency letter shows that there was a net loss in 1919 which was deducted in arriving at the net income for 1918. Appropriate adjustment of the amount of the 1919 income, resulting from the revision of the inventory at the close of 1918, will be made in redetermining the amount of the deficiency for 1918.

Judgment will be entered under Rule 50.  