New-York tribune., 1922-04-17

-, ouestion-Will YOU be so good as to
YOU can Regarding the T.. r. steel Service
corporation? We understand that this
corporation operates a line Of chain stores
ana that 1t also has in connection with
the chain stores. realty proposition We
90 not know, however. how many stores
the sale OF stock is to be used for. nor
have we seen one of its statements show
ing It's conditon.-J. K. B.
Answer-It is impossible in the limits
OF space and time to present all the
pertinent facts regarding L. R. Steel,
his enterprises and the stocks his
organization is selling. In general,
1T may be said that our criticism is
based primarily on balance sheets of
the l.. R. Steel Company, Inc, and
various subsidiaries submitted to US
by the company itself Glancing at
some of the important items Of the
l.. r. Steel Company, Inc, it may
be seen that as of September 80,
1921, L, r. Steel Company carried
among assets the following items:
Accounts and bills receivable, $2,742,-
b0l; investments, $3,4946O8; and
leaseholds, good will and organization
expenses, $3,l23, ,254. Total assets are
listed at $11 1888 ,202, so it may be seen
that these three items form the bulk
OF the assets. Now, among the bills
receivable account it is found that
$2,275,5l1 is made up of sums due
from subsidiaries stock sales, etc. In
Vestments, it is found, consist of stock
OF subsidiaries of a value none too we'll
established, and $4,000 in fourth 4A
per cent Liberty bonds. Leaseholds
good Will, etc, can be valued at any
convenient figure for balance sheet
purposes. Others have commented on
the L. R. Steel organization. For in
stance, the "United States Investor"
devoted two pages March 5, 1921, to
discussing the proposition under the
title: IL. r. Steel Company, Inc
A Bold Plan for Financing Mer-
chant's Ambitions on Other People's
Money" Details Of the expansion
may be obtained from any of the or
ganizatlon's circulars. Discussing one
OF the subsidiaries, the Steel Realty
Development Corporation, from the
standpoint Of the balance sheet. The
Tribune said on January II, 1922.
he Steel Realty Corporation is one
OF the concerns promoted by the l.. R.
Steel organization during the last
ohFee years. Stock in this companv
and IN the other steel concerns has
been energctically sold to the public.
lust how cnergetically the item of
S!75,355 commissions on stock sales
CARRIED as an asset in the companv's
balance sheet of August 81, last, demon
strates. The same balance sheet shows
total assets of $5,502,S71, Of which
only $l2,661 represented cash on hand
and IN the banks. The ether princinal
items in the assets side of the balance
sheet, besides real estate. pron-
erty, furniture and fixtures, which
were carried at $1,663,776 were an in
vestment in the Steel Realty Deyelon-
ment Cooperation, Limited, the Cana
dlar subsidiary, carried at S1,072.512.
corporate taxes and organization ey,
penses. carried at $775, 5,785, and accounts
and bills receivable, $551 652. Balance
due on stock subscriptions was also
carried at $635,172. 1t scarcely rc-
qulres an expert accountant to arrive
at the conclusion that stock in this
concern should be classcd as yerv
speculative security" The Steel Serv-
ice Corporation is engaged in selling
the securities of the other subsidiariea