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(1948) . The Court of Appeals for the Eighth Circuit held with the Commissioner on all issues. 175 F. 2d 305 (1949) . We granted certiorari, 338 U. S. 909 (1950), in view of an asserted conflict between the decision below and that of the Court of Appeals for the Third Circuit in Commissioner v. McKay Products Corp., 178 F. 2d 639 (1949), reversing the Tax Court, 9 T. C. 1082 (1947). Two questions must be determined: First, whether petitioner in computing its normal-tax net income, which is adjusted in determining excess profits net income, is entitled to deductions for depreciation with respect to property transferred to it from community groups Or ac­quired with cash to the extent received from suqh groups. Petitioner contends that the properties so acqqired were depreciable as “gifts” under § 113 (a) (2) of the Internal Revenue Code or as “contributions to capital” under § 113 (a) (8) (B) or both; as to the properties acquired with cash it contends alternatively that they had “cost” to the taxpayer under § 113 (a).2 Second, we must de­cide whether in computing petitioner’s invested capital credit the aggregate value of the assets transferred by the community groups may be included in equity invested 2 BROWN SHOE CO. v. COMMISSIONER. 2 Section 23 (l) of the Code permits a deduction from gross income for depreciation of property, and § 23 (n) provides for depreciation shall be as provided in § 114, w htihcaht athdeo p“tbsa stihse” “adjusted basis” provided in § 113 (b) for determining gain. This s(uubnsaedcjtuisotne din) ”t ushranl lr ebfee rtsh et o“ c§o s1t1”3 o(fa )t hwe hpircohp eprrtoyv,i wdietsh t cheartt atihne e“xbcaespis­tthiaotn, s “iInfc ltuhdei npgr otpheer tfyol wloawsi nagc:q u§i r1e1d3 b(ay) g(i2f)t apfrtoevri dDeesc einm breelre v3a1n, t-1p9a2r0,t the basis shall be the same as it would be in the hands of the donor goirft , t.h e. .l ast §p1r1e3ce (dai)n g( 8)o wnperorv ibdyes wthhaotm “Iift twhaes pnrootp eratcyq uwiaresd acb­y quired after December 31, 1920, by a corporation . . . (B) as paid-in ssuarmpel uass iotr waosu lad cboen tinr itbhuet ihoann dtso ocfa ptihtea lt,r atnhsefne rtohre. b.asisII shall be the