Perth Amboy evening news., 1918-03-27

pu. them in, II you Will.
Mr.. McCarter: Read this entire
statement?
$ Commissioner Donges: Yes, for
the three years.
Mr.. McCarter: Very good. Then on
this statement Is shown the Item OF
incorporating income before deduct
ing the depreciation, 1915, $7'046,,,
560.44. For 1917, $6,227, ,0S3.16. and
for 1918, estimated, SIS, The
next item is operating income and other
operations and show In 1915. s13,-
76S.69; 1917, s11, ,517.1Si 1918, estimat-
ed, $4,000.
Now, to this is added, in each year.
tho incorporating income. rms,
suppose, Is from the operation OF
some subsidiaries. like the ferry com
pany, that we control. In the case OF
1915 that sum was s206, ,270.o4: for
1917, s217, 7,6S7.77. For 1918, the es-
innate is 100000. This gives us, ad-
ding the gross corporate income, be-
fore deducting depreciation for these
three years, as follows: 1915, s7'2oo',,
5ss.77; for 1917, s6,45S,2SS.11; and
1918, estimated, s5,343,262.96.
From these sums we deduct for
the respective years income, taxes,
interest on funded debt. and rentals,
1915, $5,057,S52.1s; 1917, IS. 1895
80; 1918, estimated, $5,165,746.ie %;
leaving a balance for the respective
SO: 1917, $1,311, ,424.79; 1918, esti-
mated-well, the 1913 statement diff
fers little, because it has combined
the next two items; on the 1916 and
1917 sheets have two items that IN
the 1918 sheet happened to be lump
ed together: the two of them are very
small.
Commissioner Donges. What are
they?
miscellaneous appropriations for the
year 1916, s5S1.22, which in the year
1917 were $6,691.91. In 1918 there
is no estimate shown on this sheet.
Mr.. Wakelee. You better add
those, then.
Mr.. McCarter. Then, 1916 and
1917, there Is also shown miscella-
neous surplus credits, which are, FOR
the year 1916, s1O,4o1.14; for 1917,
item Is not shown, SO that the next
item common to all is the balance
available to depreciation, dividends
and surplus. In 1916 1t was $2,219,-
067.57: in 1917. $1,357,O11.17; and
estimated in 1918, S177.517.81.
Now, in 1916, the appropriation for
depreciation reserve was $72S,OO1.1S,
little enough for a property of this
magnitude, with 900 miles of track,
and $1S,000,000 of gross receipts. In
the year 1917, due to the exigencies
Of the situation, that sum was $174,-
46S.44, a manifestly inadequate sum.
The property had been we'll main
tanned before to stand a small depre-
citation reserve of this kind for per-
haps a year, but not for any great
length of time. For the year 1918 we
have taken for our basis of deprecia-
ton reserve the amount set up in
1916, and super-imposed upon that
the present cost of doing the work
provided by the sum In 1915. Do 1
make that clear, Mr.. Commissioner?
Commissioner Donges. I think so.
In other words, you have estimated
the same amount of depreciation
Mr.. McCarter. Set up the same de-
probation.
Commissioner Donges. The same
depreciation for 1915. on the basis of
the cost of 1918?
Mr.. McCartcr-Yes.
Mr.. Record. What does that make? ?
Mr.. McCarter: And that makes, an
ticipating the $728,001.18, that 1t was
in 1915, 1t makes $1.1ss, ,149.61.
This leaves balances for the three
years. as follows, coming down to the
amount available for dividends and
surplus. 1918, $1,491, ,066.3S; 1917,
122-64213;lsfs, estimated deficit,
31,010, ,631.80.
Carrying out the theory of putting
ourselves back upon the 1916 basis,
we next insert in the 1918 statement
the earnings of 1916, amounting to
81, 491, ,066.3S. to which we add
Mr.. Record. Won't you state that
again?
Mfr. McCarter. Yes, sir. The figures
or the substance of the proposition?
Mr.. Record. You Said the earnings
for 1916
Mr.. McCarter I say to this figure
we insert the figures of 1915 to this
statement as far as it has gone.
Mr.. Record. You say earnings"
That is not a very accurate state
ment.
Mr.. McCarter. You are right about
that.
Commissioner Donges. The amount
available for dividends.
Mr.. McCarter. Amount available
for surplus and dividends.
Mr.. Record. Which was, in 1915,
$1.491 900?
Mr.. McCarter. $1,4s1, 1,0663S. Since
that time there has been authorized
by the Commission, for capital for
allowed improvements, $1.250.000 of
stock, on which we compute eight per
cent. which is 100000; and. there
fore. to put us back on the 1916 basis,
plus eight per cent. on the new
money that has gone in since, we ar
rived at a figure of 1851, 1,066.3S,
which. added to the foregoing deficit
of $1,010.631.S0 makes a total deficit
Of 2,601. .698.18, which must be over
come to put us back on the 1916
basis.
Mr.. Wakelee. What is the corre-
spending figure for 1916 and 1917?
don't think you have given us that.
Mr.. McCarter. Well, the corre-
spending figure-I have given those
figures for 1916, $1,491,066.3S.
Mr.. WakeIee. Have you given
them?
Mr.. McCarter. Yes, I have given
them, but that is not the end OF the
story.
Commissioner Donges. That hardly
puts you on the same basis with eight
per cent return upon the capital put
In IN 1917 and 1918; 1t gives a larger
return upon the million and a quarter
OF new capital that was earned on
the capital heretofore.
MIR. McCarter. That Is true. 1t
takes eight per cent. Of the new capt.
tai that has gone in since that time.
Commissioner DOnges. We will re-
cess until two o'clock
After recess Mr. McCarter furnish
Cd copies of the financial statement
he referred to, and went on:
had reached a point when the
interruption for luncheon took place
showing on the statement now m RI