Great Falls tribune. [volume] (Great Falls, Mont.) 1921-current, 1922-05-13
WITNESS SAYS
LIVESTOCK WORTH
WAS UNIDENTIFIED
Accountant Testifies to Raising
Prescott's Inventory From
$4,000 to 49,, $50.
(Trlbsas,s Helena Bursau.)

Helena, May 12.-Testimony as TO
the financial situation of the South
Pondera Ranch company, following
that furnished by w. B. Finlay. an ac-
c0untant of Great Falls, was given
Friday afternoon in the trial Of Scott
against Prescott case by F. s. Jacob
sen, a public accountant of Helena.
Mr.. Finlay had been on the stand all
OF the day up to 2:4O a'clock in the af-
ternoon, when his cross-examination
was concluded and he was excused.
MI. Jacobsen who had been given
the books of Mr. Prescott and the
ranch company May 2, since the begin
ming of the trial. testified that he took
the inventory of personal property on
the Scott-Prescott ranch, as of March,
1918, that he figured the worth of the
company OF the defendants own state
ment of assets as of December 81,
1917, as to real estate, improvements
and equipment and that he took the
various securities held by the firm at
what they were carried on the firms
books; that while defendants inventory
showed only $37, 700 worth of livestock
the witness fixed q valuation upon the
livestock of $85,060, or an increase of
$4S.26O over that carried on the firms
books.
He said he had found the ranch sup
plies on hand to inventory the value of
$11 ,O76; that he had found an item
of $1,312 charged as a firm expense
when it appeared by q later notation
to have been an expense in caring for
livestock owned personally by Pres
colt; that he found 5 1928 had been en-
tered as a credit to the firm but not
actually carried into the totals of cash
received and that likewise a similar
entry of $1,323 had been included in
expenditures as an expense of the firm.
for which there was no entry to show
what expended for other than an entry
to "see bill Of South Pondera Ranch
company" which could not be located,
and that another item of $1,597 had
been entered as receipts but not in
cluded in the charge to cash account,
which, correct accounting required,
should have been charged to Prescott.
He testified that he had found a few
trivial errors in footings and other er-
rOrs which were gone into at length.
Mr.. Jacobsen testified that, taking
the company's balance sheet of De-
cember 81, 1917, and extending the
same to March 10, 1918. after making
the corrections in the inventory and
allowing for other errors and giving
Prescott credit for $2,91S paid as addi-
tlOnal income tax for the years 1914
to 1917. inclusive, the total resources
of the firm figured Sis. no, and de-
Quoting $2,3O2 for liabilities shown on
the books, would leave a net worth of
l176,468, which, after ~deducting the
original capital investment of $4,000.
leaves undivided profits of $1O4,4 6S.
He said that to determine all profits
it would be necessary to add to this
S19,299 divided between Prescott and
Scott in January, 1913, and wool checks
a~ggregating in excess of $4,000 divid-
ed in April, 1913.
On cross-examination, he said the
reason he had taken the valuations on
real estate. improvements, equipment
and securities at the company's book
figures was, that he deemed them fixed
assets and that nom of the assets were
readily saleable at a fixed open market
or stock exchange and were really cap
ital investment.
He said he had valued the sheep at
what they had sold for, so far as the
books indicated sales. and the value of
the balance of the sheep at what could
have been realized if shipped to the
Chicago market. Asked if a company |
could determine its profits until it had
sold its sheep. he said there were fixed
methods of determining profits by set
ting out in the inventory a conserva-
tive market value of product.