davidaulloa/AmericanStories huggingface dataset:
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20

TEERE are two reasons why there should be Liberty
Bond in every home Either of them offers a sufficient
4 impulse for the investment The first,
Patriotism and, second, Thrift
Patriotism is the expression of every individuals obga-
ton to the country which protects him and gives him the
pouny develop his abilities and gain the reward OF his
efforts.
Patriotism often finds ebulent and hyserical
preston but reduced real it is matter of the obi
cation of each man and woman contribute his her share
for the good for the advantages gained from
living in a well ordered society.
This obligation naturally extends to contributing for the
common defence The contribution may be outright gift
under general worked presumably
equitable basis Such gifts take the form of and voun
tary contributions and charities and organza
TONS The other obligation lend money the
an ordinary business matter.
Lending money under such circumstances considered
its relation individuals practical application OF the thrift
idea 1t is much saving money deposited in savings
bank 1t draws interest three and oneha per is
safe the stable Ii the government
is stable then investment safe and property rights
we'll as property values will vanish personal safety and the
right to the pursuit of happiness disappear also There
is no better than government bonds Investment
in them the duty of those who the the
navy and is the discharge of similar obligation although is
regarded as heroic.
Investment in government bonds is a safeguard of the
future just life insurance savings account is safeguard
But at this time something than that The govern
men needs billion dollars but will need much more
in few months 1t will need large amounts continuously
until end of the and probably for time thereafter
Already Congress has authorized bond and treasury note
issue of billions Current estimates that the will
cost ten billions the twelve months. The fact that two
billions only first nstament not be forgotten These
are all estimates. They may be exceeded
To secure two billions the government must receive
average subscription of $1,000 from each of two million
sons But the average will be much below that If there
less than FIVE million subscribers to the first bond issue, it will
be failure as a of patriotism.
But if five million persons subscribe the average of the
subscriptions will be $500 1t obvious therefore, that
good many thousands of people buy the bonds in the
small denomination of $50 and 500.
The small should out of current savings
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20
Basis for Figuring
Progressive Change

"The basis for a progressive
charge on the simple excess is not
SO clear without recourse to some
element Of faculty. As soon Is it
is decided TO relate the excess to a
basis Of capital or pre-war profit
before applying a progressive tax,
the popular idea as to special war
time ability to pay seems to have
a chance to operate; but, of course,
it is as far off as ever from a work.
ing principle, because the popular
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20
Advantages OF
Report Form

The income account of an indus
trial company should be given in
what is known as Report Form"
Under this method expenses are
grouped as follows: Cost of goods
sold, productive labor, manufactur-
ing overhead charges, selling ex-
penses, and administrative and gen.
.eral expenses. Adding these items
gives the total cost of goods sold.
The great advantage Of the RE
port Form" as compared with the
Account Form" is that in the case
of the former the proportion Of the
gross sales, consumed by the cost Of
the goods sold, of productive labor,
etc, is apparent at a glance, while
under the Account Form" there is
simply a column of debts and cred
its, and the items are not grouped
according to the purposes of the ex-
penses.
met revenue from operation" in
the income account of a steam rail-
road, is, as its name signifies, the
balance remaining after deducting
from operating revenue the operat-
ing expenses named above. To ascer-
tain the operating ratio of the road,
divide the operating expenses by the
operating revenue. There is no hard
and fast rule as to what the ratio
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20
Why You Should Buy Liberty Bond


the loan to attain the greatest Past savings evil
denced by credit savings banks should be used
only a limited preferably, not at ALL The funds
of savings banks in banking parlance, not liquid They
are in the form Of bonds of various kinds and
large part Of the fixed capital of the country Extensive de-
mands on the savings banks would force the liquidation OF
these and dislocate the bond market and OF
course the money market The loan is therefore, to be sub
scrbed for of and future savings The extent or
the thrift of the people will have be increased the neces
sary for financing the to be secured from these
current and additional savings.
There is much that the banks themselves do Every
bank can carry limited of long time securities but
the greater the quantity of such securities the smaller is the
capacity Of the bank the demands of its commercial
customers Business go whatever eventuates On
that depends much victory in battle 1t may
not be the same kind of There great deal of
business going according to the demands or peace
which will be diverted the demands of But
there doubt that business and that if it to
go the banks be position to give the usual assist
business
1t than likely that business will be very good if
the loan is popularity subscribed The factories and mills will
be busy all of orders from the There
shortage of all kinds of supplies Labor will be freely
ployed and the demand for it is likely be only partly salts
fed The people who should subscribe the loan will there
FORE have the funds with which the payments But
it great deal of money that is wanted 1t $40 for every
man. and child in the United States. That
$00 for each family And that that hundreds of fam
lilies who will respond the demand will have add
economy that pracised They will not have to put
economy operation for the loss that would attend
the making of a gift They will have put economy
operation for the gain that will attend the saving of the
subscribed the bond issue They will have the
curity They will receive the interest regularly. And
the country will be better off because Of the thrift of its people,
Thrift is only fine habit but a great national
The people Of this country wealthy but because of any
particular habits of thrift They have been large spenders
and great They will learn cura expenses and
prevent either by voluntary aconby keen reaza-
ton Of the necessity for they will learn it the result
of disaster and The important thing that they
going learn way the other. the increase in the
savings of the people that going supply the money with
which fight successful conclusion the greatest of all
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20
Significance of
Operating Ratio

/ 1t is a favorable indication If, over
a series of years, the item of trans
portation expenses shows a continual
decrease in the percentage of operat-
ing revenue consumed, because trans
portation represents tout of pocket"
expenses, which, unlike expenses for
maintenance of way and equipment,
cannot be varied at the will Of the
management.
depreciation" is very important
item. Whether it should be included
under operating expenses, under de-
auctions from gross corporate in
come, or should be placed on the
debit side of the profit and loss ac-
count, is debatable question.
The steam railroads include de-
probation as a part of their operat-
ing expenses, practically all of it be-
ing included under maintenance Of
equipment. Very little is charged to
maintenance of way and structures,
owing to the fact that repairs, re-
newaIs and requirements are contin-
Ually being made. Public utility and
industrial companies have no uni
form policy. Some include deprecia-
ton under operating expenses; others
among deductions from net revenue;
not few present it as part of fixed
charges, while a great many charge
it each year to the profit and loss ac-
count.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20
What Other
Income" Means

The next item, "Other income q,
as some authorities call it, "addjtio,,
to income" represents the anon.
derived from sources other ia,
those related to the principal fun.
ton of the company. For ius.rcs
interest on bonds and divided, an
stocks owned-not including tie com.
pany's own securities-interss. On
notes receivable, hire Of equipment
credit balance, rent income, and IN.
terest on bank deposits, come under
this heading.
"Other income" added to "opers,.
ing revenue" produces gross income
or gross corporate income. This item
represents the amount earned dun.
ing a certain period which is avail.
able for all fixed charges, and shows
whether or not the company Ia.
earned a sufficient margin over and
above all charges.
The fixed charges, or deductions
from gross corporate income, are
now to be considered. In railroads
they are hire of equipment, rntals,
interest on funded debt and interest
on floating debt. This order is DE-
batable, but it is, nevertheless, con-
sidered conservative to deduct hire
of equipment first, because q steam
railroad, for instance, cannot operate
without equipment. Rentals are
given second place, for the reason
. that the property leased is probably
as important as the property covered
by the company's own bonds.
Interest on funded debt includes
interest on all debt except floating
debt. 1t includes interest on mort
gage bonds, collateral trust bonds
Gebentures, equipment obligations
and notes due a year or more IRON
the date of issue. Interest on foat
ing debt" includes interest on obllga-
tions due in less than one year. II
should be borne in mind, however,
that interest on income or adjust
ment bonds, as they are sometimes
called, although secured by mortre
and included in the mortgage deoI
does not have to be paid unless
earned; therefore this interest pay.
ment does not form part Of the nSe'
charges.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20
Taxing Amusement Seekers

In the Province of British Columbia
the amusement tax is graded as fol-
lows: Where admission is not more
than 10 cents, . cents; more than 10
and not more than so cents. cents;
more than 80 cents and not more than
81. 10 cents. and over 81. Is cents. The
act does not apply 10 religious or semi
religious entertainments. fair or exhi-
tons Of paintings. or those the entire
proceeds Of which are devoted 70 pa
triotic or charitable purposes. The gov
eminent will supply tickets TO amuse-
ment places. the proprietors of which
will be paid a commission on their
sale.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20

made TO bear tax which is heavier
according TO the greater relative
amount of the excess; or 1t may be
looked at in relation to the capital OF
the business, either by the percent
age which the total war-period proflt
bears TO that capital or by the per-
centage which the excess itself bears
thereto, and a progressive scale ap-
piled.
"Such progressive taxation Of
businesses as a whole finds no JUS
LITIGATION on grounds Of marginal
psychological sacrifice. But one or
two writers have based progression
not so much upon the taxpayers sub
jective powers as upon his objective
capacity, with the idea Of his COM
mand over economic resources in
general on the productive side.
"a theoretic basis for the proper
tional taxation of the excess profit
unrelated to any standards), i. e.,
at flat rate, may perhaps be found
in the benefit principle, if it is postu-
lated that the state and the COM
munity during wartime supply ele-
ments through which excess profits
arise, and that such external assist
ance is unrelated to previous cir
cumstances or to the absolute size
of the business. Under this con-
ception the tax element is in the
background, and the position
energies that the payment IS a bust
ness expense, a royalty, condition
precedent to the making of profit.
1t is a payment out of gross profits
before they can become income at
ell. If excess arises through in
creased output at original prices,
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20
BY II. A. MCCORMACK,
Bond Department, Guaranty Trust
Company

Bond Department, Guaranty Trust
Company
A n INCOME account exhibits
n the financial operations that
Il produce the profits and losses
Of a company during a definite
period. In other words, the income
account is a section of the profit and
loss account representing the nom
inal accounts taken from the trial
balance. These show the sources OF
the various expenses and incomes OF
every description which result from
conducting a business, all Of which
have the effect of increasing or de-
creasing the capital of the concern.
An income account is not statement
of cash receipts and disbursements
only, but includes the income earned
during the given period, whether rep
resented by cash or on account. The
principal features, in the order OF
their relative importance, are here
outlined.
Operating or gross revenue" IS
the sum obtained solely from the per-
Torrance of the function for which
the company was created. Techni-
cally, it does not include returns
from any other source. For in
stance, in a railroad company's re-
port, the operating revenue is the
amount received from conducting the
business of transportation.
/ consider it improper to use the
term "gross earnings" because this
term really comprises gross revenue
plus other income. Moreover, the OPP
Grating efficiency Of a company, as
measured by the amount of operat-
ing revenue consumed by operating
expenses, cannot be ascertained.
Should it be desired, however, to
determine if the company has COM
piled with the terms of mortgage,
the method used depends upon the
wording Of the indenture.
Operating expenses" represent
what is spent to produce operating
revenue. In railroads income ac-
count the three main items, in order
of the amounts expended, are trans
portation, which includes wages, fuel,
etc.; maintenance of equipment,
which includes expenditures on loco
motives and freight cars; and main
tenance of way and structures,
which includes the cost Of main
tenance of track, roadbed, ties, etc.
There are also some general ex-
penses which are comparatively
small.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20
What This Country
Now Proposes

The United States, like Great
Britain, plans to finance consid-
cradle portion of the war cost out
of taxes, thus reducing the total of
war loans that will be passed on to
later generations. Here it is pro-
posed TO raise nearly S2,000,000,00
by taxation alone, and the new ex-
cess profits tax is expected to supply
a substantial portion of this. The
tax bill enacted in March as an
emergency measure for raising
money for military preparedness is
similar to that in force in Canada,
except that it levies an assessment
of 8 per cent on all profits made
with the first $4,000 exempted
above 8 per cent on capital invest
ment, whereas the Canadian tax
was 20 per cent on all profits over
z per cent.
New war revenue legislation now
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20

the communal necessities have pro-
vided the conditions under which
that supply is taken up, and a
charge is made for supplying those
conditions; if the excess arises
through higher prices on normal out
put, the state makes a similar
charge. Apart from the rare cases
where excess is due entirely to re-
duced expenses, these two classes,
or combination of them, cover the
field, and a proportional charge is,
at any rate, comprehensive on this
principle.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20

These restrictions did not last long,
and soon the general conception OF
the tax was broadened.
The German Minister Of Finance
held that on grounds Of justice as
well as productivity it was necessary
to have a comprehensive tax, and
that TO regard it as a kind Of penal
tax on excessive profits from war
contracts would be to start off in the
wrong direction. The Spanish min
lister suggested that where concerns
were making abnormal profits at the
cost and injury of others, 1t was
merely a matter of justice that they
should be burdened. In France the
carly proposals were confined to war
profits, but developed on the usual
lines Immediately the scheme
reached the legislative stage. In
general, it may be said that in the
case Of countries that have adopted
the tax more recently, although OBJ
vious cases of profteering have had
some influence, the governments,
pressed to find revenue and seeing
this in force elsewhere, have adopted
the tax by imitation for fiscal rea-
sons only and have given it the wild
est scope.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20

impairment Of its present or pro-
eressive productive power. Thus by
resting an impersonal faculty in
each self-contained aggregation of
assets this form of taxation may be
reached. But when the second kind
If relationship, that which COM
oares the excess with the pre-war
profits, prevails, and the tax is pro-
!ressive accordingly, we seem to get
near to the principle that to him
ihat hath shall be given, and from
MIN that hath not shall be taken
sway even that which he hath"
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20
English Law Is
Made Drastic

The British government has pro-
vided a greater portion of its war
expenditures out of taxes than any
other belligerent. This accounts for
the drastic character of the English
tax law. The year before the war
England raised approximately $780,
100000 by means of taxes. In the
fiscal year ended March 81 last that
figure had been raised to $780,
100000. 1t has been estimated that
the total cost of the war TO England
up to the present has been about
$4,000, 100000, increased revenue
produced by taxation contributing
about Is per cent of this total cost.
The British excess profits tax, en-
acted in November, 1915, provided
for levy of 80 per cent on all ex-
cess profits in excess Of the average
profits of each business during two
Of the last three years preceding the
war. A year ago it was raised to
60 per cent, and only recently was
again raised, this time to so per
cent, the latter rate applying to the
current year. This tax has proved
Unexpectedly remunerative to Eng
land, and it is estimated will yield
upward of 81 ,00O,0O0,0OO at the cur
rent rate. A company, for example,
that earned $4,000 normally before
the war and shows earnings Of
S350,000 per annum now must pay
to the British government so per
cent of 100000, or $4,000, as an
excess profits tax.
Germany in her first excess profits
law imposed a fat so per cent, but
the provisions of the German law
as il stands now are most elaborate,
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20
Munitions Makers
Singled Out

The first form of excess tax
adopted in the United States be-
longed to the earliest type, how
ever. 1t was enacted last year in
the munitions tax, a feature of the
war revenue law, which provided for
a tax Of 1917 per cent upon the net
profits of manufacturers Of NUM-
tons, to be collected until one year
after the end of the war.
The standard above which the ex-
cess is measured is, in some coun-
tries, the average of two years pre-
ceding the war. or in others, where
liability did not begin in 1914, the
years 1913 and 1914. France, Hol-
/ land and Denmark have taken the
average of three years. The Ger
man standard is ingenious. From
the five pre-war years the best and
worst years are eliminated, and the
profits of the remaining three aver
aged. Canada has no pre-war stand
ard of profits, but has adopted a
standard of percentage on capital
throughout.
/ One of the difficulties in levying
the excess profits tax wherever it
has been enacted has been to arrive
at satisfactory definition of CAPT
tai. Various countries have as re-
suit set up various conceptions of
the capital" employed in business.
On the whole, it may be said that
they approximate to the actual sums
originally invested therein by the
proprietors, and are not related to
the market value Of the concern in
the ante-bellum years.
Various economic and political
conditions obtaining in the several
countries have naturally led to
marked differences in the extent TO
which all branches of industry and
profit-earning have been brought
within the tax. Agriculture is ex-
Guided in Canada, Italy and Aus
tralia, while livestock raising in
Canada and fruit-growing in Aus
tralia are exempt. In Canada life
insurance companies and companies
where 90 per cent of the stock is
owned by provincial or municipal
authorities are outside the tax.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20

Taxation is one Of the first prod
ucts of civilization. 1t is an insti-
tuition that has come down through
the centuries. growing gradually
more and more equitable as reaction
has given way to liberalism. Sue
ceeding generations have evolved
new forms Of taxation 10 meet new
and extraordinary needs. The taxa
ton system in most countries has,
accordingly, grown increasingly com
plex and in many ways more bur
densome. For developing new meth
DDS Of taxation the present war has
probably produced the greatest
changes that have ever taken place
within an equal period. Taxation OF
the kind needed to oil and feed the
machinery Of the modern juggernaut
Of war has been evolved to meet the
cxigencies of a crisis in world af-
fairs. Countries the world over are
now paying the greatest tribute to
the war god in history. National
governments are levying a burden
of taxes that is truly colossal, sup
plementing in this manner the sin
ews Of war provided by the stupen-
dous war loan operations.
Of the innumerable forms of taxes
which the war has brought forth in
the different countries, probably the
most interesting, perhaps because Of
its novelty, and one that has spread
the most rapidly as a means of rails
ing war revenues without putting
too much burden on corporate en-
terprise, is the extra or excess prof
its tax. From a small beginning as
an experiment in Northern Europe
its use has expanded, until nearly all
the great powers have adopted it,,
neutrals as well as belligerents. The
United States adopted the excess
profits tax programme early this
year, and now that we are in the
war is planning to enlarge its scope.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-20
Basis for Levy
Is Broadened

While Germany and other North
ern European countries were pre-
pairing 70 levy the new taxes, the
matter came 20 a head in England
when the British government an
nounced that a special tax on war
profits would be introduced, and
when, as a part Of the scheme for
the control Of munition firms, linn
itation Of profits. if not exactly a
tax, was arranged.
In It's earliest stage of develop
ment the new form of tax was sug-
gested as a tax on extra profits
made in consequence of the war.
The idea was 10 tax the excessive
profts Of individuals and concerns
which came into being with the war.
In Bremen the scheme provided that
the excess profit was 10 be regarded
as a "war profit" unless proof was
given 10 the contrary. Denmark
passed a law which provided that
II the profits were not due to the
war the tax would not be collected,
land In Sweden the tax was made col
lectible on incomes from industry ac-
cruing as q result Of the conditions
brought about by the war, with
special rights Of appeal when the
taxpayer thought he could produce
proof that the excess was not due to
the. situation created by the war.