The Washington herald., 1921-05-14
War loves to seek its victims in the young.
-Sophocles.
The Washington Railways.
XVII. w. r. & z. EARNINGS.

THE w. R. & E. has insistently claimed that
it has failed to earn per cent return on the
commissions valuation = SI6,2soooo - from
September. 1918 to and including December, 1920
just what the facts as to this?
For the year 1919 its operating revenues were
S4,387,ooo, an increase Of $II6oooo over 1918 But
the net operating revenue-$oo8,7ao was less by
$1,000 than the prior year. This was mainly be-
cause OF increase of the payroll of some 100000 and
in the investment in equipment and in ways and
structures which show increase we'll over 100000
The net income transferred to profit and loss for
dividends or other uses was $4,000 This would
have paid the 5 per cent dividend the S. 100000
of preferred stock and left balance of $4,000 But
the company also paid interest its bonded
debt of $I7,sooooo which exceeds its fair value by
SI25oooo Adding this interest its balance for
dividends, and the companys income is found to be
sI.234,Soo or just under IA per cent Of its fair
valuation. -
However, considering the w. R. & E only as
railroad property, and disregarding its sole
ship of the Potomac Electric Company, there would
be deducted from this $I,z34,8oo the $4,000 re-
ceived from the electric company as dividends
This changes the railroad company's Income" to
its earnings" which therefore but S6o4, 300
or just under ~ per cent of its fair valuation as
actual street railway earnings"
In 1870 the gross earnings or operating rev.
of So84ooo. The net operating was 81 49,
600 and this showed gain over 1919 of $4,000.
The operating income was $4,000 gain 1919
OF $4,000. The net income transferred to profit
and loss was $656yooo; again gain 1919 Of
SI67,ooo, for payment of dividends or other uses
This would have paid the per cent dividend on
preferred stock and left $2IIooo as very comfort
able balance to use as dividends on S. 100000 of
common stock, or otherwise
Adding to the net income $636ooo the $766,Soo
which had been deducted in payment of interest on
the bonded debt, and the actual income of the
company for 1870 is found be $I4o2 300 or just
under per cent the fair valuation In this
amount included dividends from the Potomac
Electric, 100000 which due probably to increased
operating costs, $4,000 less than in 1919. De-
duetng this and it will be found that the W. R &
E. actually earned last year street railway
alone Soz3.ooo just under per cent of the fair
value.
But the w. u & E. does the Potomac
Electric, whose earnings always go to swell its in
come. 1t owns every dollar Of the Potomac Elec-
trio stock and that corporations earnings are its
earnings and go directly into its income account
1t, therefore, did have an income in 1910 equal to
III per cent of its fair value and an income in 1920
OF just under per cent OF its valuation. When,
therefore, it claims that it does not earn" per
cent it is not exactly frank, though technically
perhaps within the bounds
Is it not, however earning enough? What pos
sible excuse in fairness has it to ask for an in
trease of either fare or light and power
rates and it does ask both. How much should
the people of this District be asked to pay? Does
not this corporation owe something to the people,
or is the debt all to it, and great can never
be paid?