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Show bo Bays, not that tho dividend were 9 per cent, but that tho net rocclptt were 9 per cent And It was the net receipts that were poed to surplus. Net receipts, whether they go to dividends, divi-dends, to capital or to surplus, are still net reeelpta. And Mr. Armour gots his result of 9 per cant on "capital" by figuring the net receipts of one year on the capital plus the not receipts re-ceipts of former years. S.000.00ii. which Is ids than 0 per I cent Dut where did the tremendous surplus of TO.nou.oriK, accumulated In ten years, come from? Manifestly, oirt of earnings. And the earnings came nut of the people who have i been paying the hlich prices for beef. If n corporation were permitted to count as earning only what It declared de-clared In dividends. It could arrange matters so as to show no earnings simply by refusing to declare dll dc-nds. For the ear ending October 23 last the Armours showed nt earnings of $7,127,000. and this was above all administrative ad-ministrative expenses, Including Interest Inter-est It Is said that the company has not 'been In the habit of paying dividends, divi-dends, but that Its net earnings have been passed to surplus. In ten years this surplus has been built up to $70,-l $70,-l 000.000. that Is, It has grown at the rate of $7,000,000 a year. Just about the amount of the net earnings for the last year. Thus the company has earned above everything S0.ooo.ooo In ten years, or more than three times the amount of Its cap-.ial. For ten years Its net earnings have been 35 prr cent each year on Us actual capital capi-tal If Mr. Armour chooses to add the surplus to the capital when he figures his earnings, that Is his privilege. No one cares what he does with his earnings. earn-ings. He may use thorn to pay dividends, divi-dends, use them to swell his surplus or Increase his capita. But they are earning Just the same. And when he figures his rate of earnings on this basis he Is figuring earnings on earn- Ings The swelled surplus and the j increased capital have been built up out of the prices which the people paid for his product. This what ha9 happened In the case of th" steel trust. Its property Is now probably worth Its capitalization But the people peo-ple who have paid Its prices haze j;v-en j;v-en to the property lU; addc! value. S with the Armour cza. Ttv people peo-ple do not caro what the Armours 1j with their earnings. Ail they are Interested In-terested la Is that they be recopnized as earnings, no lunttcr what is done with them. If the Armours should Increase their capital to $100,000,000 In order to make the rate on the la-vestment la-vestment seem less exhorbltant. It would still be true that the capital had been built up out of net earnings The money that Is used to Increase the capital Is not subscribed by the stockholders- it is furt-ishd by every consumer of beef ann prk who uses the Armour products. . It Is to be observed that Mr. Armour Ar-mour does not attempt to dodge behind be-hind the distinction between dividends and carp'nro. For In his interview- THE ARMOUR EARNINGS. In on interview published yesler day, Mr. J Ogden Armour said that the recent statement made by his firm, on which we commented last month, showed that Its net profits did Dot exceed 9 per cent on the capital. ' I Include In tho capital," he add-d. "the accumulated surplus," On this basis Mr Armour's figures are right. The capital is $20,000,000, and the surplus sur-plus $70,000,000. On this $90,000,000 tho net receipts were a trifle over |