The Hawaiian gazette. [volume] (Honolulu [Oahu, Hawaii]) 1865-1918, 1914-01-23

est charge 100000 annually As n pro.
vision for future dividends uoen eosn.
mon stock, there would be $3,O00.0O
the first year, which would increase
yearly in the sum Of 10000.
At this rate il wonld take the pl IN.
tat'on about two hundred and twenty
years to he cut of debt and in posi-,
tion to pay $12s,000.00 annually as o
dividend upon common stock. At ths
'end Of twenty-five years II would have
retired 1925 10000 in bonds; would
have paid regular dividend Of re
cent upon the preferred stock, and
would have IN the neighl orhood Of
$16l, 10000 on hind withswhich 10 pay
0 dividend Of az, per cent upon com
mon stock. AT the end Of the 25th
year, II would have set aside in that
particular wear $l0,gO0.00 as available
for dividend upon co:rmon s.oct,
which amount would increase each year
in the snm Of 100000
Present system.
"With the same frofts, I. s17O,.
10000 per annum, under the present.
bond issue, with its cumulative SINKING
Fund feature, the following results
would be obtained: In the FIRST year
800, 10000 would be required for in.
tefest on bonds; $50, 100000 for the sink.
ing fund: and 500, 10000 would apply
as q dividend upon preferred sfoc'x.
The preferred stoekhoIdar, therefore
the first wear, would receive a dividend
of but a trifle over three per cent,
instead Of seven per cent; bat MS $780,
10000 would have been retired that
year in bonds, as against $5,00OOO am
der the old bond issue. $45 10000 ad.
ditiohal secgrity would havo been aid
ed 10 the property. As $50, 900 90 pm
yesr WIS being retired, it would cffee,
a saving of int est of 80 900 90 be
anriIm, and the amount available for
dividends upon preferred stos& would
increase s2,50000 annually. BY the
end Of the tenth year, the preferred
lstockholder would be receiving HIS full
seven per cent dividend. BY the end
of the nineteenth year, the cumulative
dividend would have con fad 90 and
he woHld have received in full his seven
per cent upon tho fill twenty We rs
At the end Of the twentieth yea. 81
|0U0,000.00 would have bee,i paid on
ln'on the bond Issue, as aeniast SlO0
10000 under tho old islns; and ia the
twentieth year &25,5DeOQ would be sol
aside as ayailable for q dividend Hpon
the eomuon stock N that psrtioular
year, rs against $500 90 rs avnllabla
for dividend under the old issue; and
thereafter. the amount available wcnld
inerease $4,000 per annnm. AT tbs
cnd Of the twentyiffth wear. there
would be available for dividsnas uron
common stock practically 1900 600. 90 as
against Sl65.00000. In forty yaars,
the plantation woull he free Of debt
and able 10 pay $I2s.O0O.o0 per annnn
upon the common stock, or 3ib per cent.
and rer cont regularly upon the pre-
ferred stock. \
Saving In Interest.
Assuming the profits to be $780,
10000 per annum, or an amount which
would apparently under the present is
sue leave nothing for dividenis ON nre
ierred stock, as il would take $780,
10000 for interest on bonds end 500.
10000 for the sinking fund, within a
very few years the preferred stock.
holders would have gained back what
they first last. AS an illus ration
under the old issue Of the $3.50 0l0. 90,
sl2O, 10000 would be required as inter.
est on bonds $S, 10000 as sinking fund,
leaving available as dividend for pre-.
fcrred stock, but $27,O00,D0 As hut
$4,000 90 per year w0uld betset aside
as Q sinking fund or the debt reduced
to this extent, a saving in intoresr
would be made OF but $4,000 per an
mum, so that the $27, 100000 ava liable
as dividend the first year rpln pre-.
ferred stock would be annually ineress.
ed TO ths extent OF $4,000. At the
end Of the tenth year, $50, $4,000 could
be pad rs q dividend upon prcferie
stock IN that year; at the end of The
ktrantt.tL AoI ann "a ,