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purpose is to obtain financing or the use of money over
a fixed period extending beyond the year of borrowing.
When we analyze the reason behind the rule of
amortizing such debt expenses, the distinction between
this case and S. & L. Building Corporation and Longview
Hilton Hotel Co. vanishes. Here, as in the cited
cases, the mortgage discounts and expenses represent
the cost of money borrowed for a period extending
beyond the year of borrowing. It matters not that the
proceeds of the loans be used to build an income--
producing warehouse as in Julia Stow Lovejoy, or "to
purchase additional properties" as in S. & L. Building
Corporation or to buy the mortgaged premises, as in the
instant case. In all such cases the expenditure
represents an expenditure for the cost of the use of
money and not a capital expenditure for the cost of any
asset obtained by the use of the proceeds of the money
borrowed.
As to the two cases upon which petitioners rely to support their
additional argument, those cases are factually distinguishable
from the case at hand and require no further discussion.
We have considered each of the arguments made by the parties
and by the amici. We have rejected all arguments not discussed
herein as meritless.
Decisions will be entered
under Rule 155.
Reviewed by the Court.
WELLS, CHABOT, COHEN, GERBER, COLVIN, VASQUEZ, and THORNTON,
JJ., agree with this majority opinion.
CHIECHI, J., did not participate in the consideration of
this opinion.
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