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September 30, 1981, balance sheet)8 and the $280,000 adjustment
made by Mr. Sheldrick in respect of the value of the hospital
complex, or a total of approximately $745,000, to the asset
values as of March 31, 1983, see supra p. 33, which reflected the
changes in the values of the cash and Treasury bills, one arrives
at a figure of $7,835,000 as the indicated fair market value of
the assets transferred.
Comparing this figure with the $6,638,120 purchase price,
see supra p. 33, it is apparent that the sale price was almost
$1,200,000 less than the fair market value of the assets
acquired. This is a substantial amount in relation to the
purchase price and causes us to conclude that the $7,835,000
falls outside the upper limit of any reasonable range of fair
market values.9 We reach the same conclusion when one compares
the increase in the net worth of petitioner adjusted to take into
account the $300,000 additional liability to the pension funds,
with the similarly adjusted net worth reflected in petitioner's
September 30, 1981 balance sheet. This increase is $798,000 (not
8 We note that the Belcher Road property was sold on Feb.
15, 1985, for $375,000 and County Road #77 property on Mar. 15,
1985, for $1,500,000, or a total of $1,875,000. This would
indicate that our use of $1,046,000, which is over $800,000 less,
may unduly favor petitioner.
9 We note that the gap between sale price and asset value
would have been even greater if we had not resolved the $300,000
pension liability question in petitioner's favor.
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