194 FOREST VALUATION 



but to the entire business of the concern. If actual cash ex- 

 penses in any year exceed actual income, such expenses can be 

 added to capital cost, and pro-rated among the parcels. The 

 net income, after subtracting capital cost of the parcel sold, 

 may be used, as far as needed, to cancel actual outlay on the 

 entire tract for the year, the surplus income remaining after 

 this total expense is met being the only portion subject to the 

 federal income tax. 



