§ 6012 Extension Gross Receipts Estimate

• •If a company adds new tracks to an existing street railroad, they have to guess how much money the new part will make.
• •The guess is based on how long the new tracks are compared to the whole railroad.
• •They take half of that share to estimate the new part's earnings.
• •This guess is final and can't be changed later.

A company adds 5 miles of new tracks to their 50-mile railroad.

They look at how much money the whole railroad makes. Then, they figure out what share the new 5 miles should get (5 out of 50 miles). They take half of that share to guess how much money the new part will make. This guess is the final answer.