The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1927-11-29

VI the $Zl ,6J5.36 gross trading
profit realized from wheat trading
. large percentage thereof resulted
from sources outside Of dealing:
with the North Dakota Mill ant
Elevator association. Also included
in this gross profit of S2l,S35.s6
is the speculative profit earned as
a result Of being Tin step with the
grain market As grain dealer
the Midland Grain company's chief
concern lies in the daily condition
Of its cash grain account determin.
ing whether or not the management
is in step with the market. We
submit in this report copy Of the
company's cash grain account,
clearly proving that the company
was always in step with the market
during tho period under review,
therefore no loss in market specu-
lation resulted On the contrary a
considerable profit was realized.
Profit Under 1 Cents Bushel
I'm view of the fact that the Mid
land Grain company handled in ex-
cess Of $4,000 bushels Of grain in
the period under review. and since
the company's gross profit from
wheat trading was definitely deter
mined to be $21, 1886, hence it fol-
lows that an average Of less than
four cents per bushel gross profit
was realized on the grain handled
and not over eight cents as alleged
III the report compiled by the audi
tor for the. state board Of auditors.
An exhibit showing the total wheat
purchases is attached hereto.
"The operating costs for the Pc
Rod under review, consisting Of ad-
ministrativc and office salaries, Of
flee rent, advertising, travel ex-
penses, telephone and telegraph ex-
pense, and other ordinary and nee
cssary business expenses amounted
to $20,239.19. This amount rep
resents the cost to the Midland
Grain company Of doing business.
1t is an outlay Of expense on be-
half of the millers and was taken
out Of the four cents per bushel
margin allowed. After dcducting
the operating costs from the gross
profit, the Midland Grain company
realized less than one and one-half
cents per bushel net profit on the
grain sold to the North Dakota Mill
and Elevator association and, in our
opinion, this is not ut all excessive.
"In arriving at the foregoing
computations We did not haphazard-
~ examine just some Of the records
Of the Midland Grain company. but
made thorough analysis of the
profit and loss account and Of the
subsidiary records governing all Of
the operations during the period I'M
der review. The results shown are
not based on arbitrary conclusions
but reflect our findings after max
ing detailed examination.
Wheat Purchases Listed
The exhibit detailing the cash
wheat record Of the Midland COM
pany covers three closely typewrit-
ten pages and lists the amount of
wheat bought and sold. together
with the dates Of the transactions,
the top closing price on the date
in question together with the pre-
vailfng premium and the number Of
bushels which the company was
"long" or "short" on the market.
It discloses that the company was
almost always "short" of the mar
ket from July 81, 1926, the first
date listed in the exhibit, until De-
cember %, 1926. From that date
until June 80, 1927, the last date
listed in the exhibit, the company
was consistently ''long" on the
market.
The index Of the prevailing pre-
MUM, as contained in the exhibit,
shows that it was 10 cents on the
first date listed but declined in the
succeeding five months, reaching a
low point of six cents on Deem
Der 80, 1926. From that date for
ward it rose steadily, reaching a
maximum Of 81 cents on June 30,
1927, the last date of the period
under examination.