The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1926-06-21
MILL SHOWS. $
PROFIT.
SAYS S0RLIE
Present Administration Makes
Nearly Four Times As
Much Per Barrel


Northwood, N. D., June 2I--Con-
tending that the state mill and ele-
vator made profit of $4,000 dur
ing 1925, and that it made a divi~
dend on its fixed capital amounting
to "a per cent, Governor A. G. Sor-
lie addressed a good sized audience
here this afternoon.
1.-THE Temple Brissman company,
expert accountants employed by the
Nestos administration, made an &C
counting of the operations of the mill
and elevator from the beginning to
December 81, 1924" said Governor
SOrlie.
"ln the accounting as made they
set up as charges against the State
Mill and Elevator interest on state
bonds issued for the construction
and operation of the Mill and Eleva-
tor from the time the bonds were is
sued.
Concerning this item of charging
such interest to the Mill and Eleva
tor, this company made the follow
ing comment:
"'The administrative policy
adopted by those in charge
contemplates that the bend
issues sold for Plant Con-
struction are an inter-
est bearing obligation of the
mill, rather than being treated
Us capital furnished for a COM
mercial adventure. A CONNER
cial adventure would not accrue
it's dividends when such divi-
dends are not earned; however
this mill project is accruing in
terest on the construction series
furnished as its fixed capital
System Is Scored
GIN other words under the system
OF accounting employed, which the
Temple Brssman mentions as one
that no commercial adventure would
employ, dividends are charged in ad-
vance every month against the Mill
nnd Elevator.
"Therc are state bonds in the sum
of $4,5OO,OOO outstanding $4,000. OOO
for construction of the plant and ST.
100000 for its operation, as an oper-
ating capital. Some of these bonds
araw 5la per cent; some GA per cent
anC some 6 per cent. The annual IN
terast charges on such bonds are
$25s, 25O.Od all of this is charged To
the mill although it is its fixed cap
;tnl. Tho same as q private corpora
ton might have. !,
cd statements showing that the Mill
md Elevator lost during the month
of May, 1926, $42,7l9.37.
"Such statement Of course includes
interest charged in advance OH state
a,onds for the construction OF the
nlant and for it's operating capitai as
.,an nc LanraciatiO ion.
"Rut il is interesting to note and
attention should be called TO tnt
fart that the State Mill and Elevator
lost almost a similar amount, ny Ine
came wav Of figuring in May 1870
namely SAL, 70G.l8.
Earned Profit y,
.,Yet in the wear 1925, before the
war ended. this same Mill and Ele,
vator earned an operating profit o.
Sl53.7I9.43: that is TO say in 1870
not figuring interest on its fixe'
canital which must be the same
whether the Mill is or is not operat
ing. and not figuring depreciation
which likewise must be the same
whether the Mill and Elevator is 81
is not operating, the Mill maze
profit Of $133,l97.89, and the eleva
tor made profit Of $2O,6Z!.o4 or %
total profit for both OF $l53,. l9.4o
These figures are taken from the r.
mort of K. c. Nelson who is the audi
tor employed by the Industrial Com
mission. ,oo- ~, CO.
ain other words in 1925 the state
M;Il and Elevator made a dlvldeno OF
it's fixed capital amounting 10 -
per cent. So M;, 49,
r,ona+or in 1925 paid to the State
over Sl63 10000 to apply on the IN,
terest charged for the fixed capita;
Furnished by the State to the MIL
and Elevator and to apply on the pa.
Nor charge made for depreciation OF
the plac.t. $50. ,s;,, ond
Elevator made $4,000 more than !, !,
would have or could have maze II y
had not operated at all.
"During the Nestos. administrator
a.. 1904 the State Mill and Elevator
inst during the first six months OF
80 war 5000, 1881, which amount
;.>far IN excess Of the losses OF the
State Mil and Elevator in 1926 FOL
= similar period this year; yet, ever
Jur;ro the Nestos administrator
> the Min and Elevator made m l914
nm onerating profit Of $7S,626.6l 1o'
the year 1924, not figuring IN ihtei.
est on bonds and depreciation; TINS
Is about the same as dividend y,
II per cent on the fixed capital Of
he Mill and Elevator.
Made Twice as Much :,
"But in 1925, under the present az
ministration, nearly twice suci
amount has been made.
"If the State Mill and Elevator wa
treated like private corporation nov
could any one say that the state NJ ~,
and Elevator was not being operated
mt a profit: how could any one sa!
that doubling its dividend in l92
over that of 1924 upon its capita
was not making . showing Of pro
I'm 1925, the State Mill manufac
tured 517.29l barrels OF Hour; TN
Mill can produce ABOUT twice -
much in a year, but the policy OF tn
nrosont administration has been t.