1544 The Cornell Reading-Courses 



$.03 (cost of maniifactiire) X 368.747 = Si 1.062 

 $11,062 (cost of manufacture) -f $3.00 (wages) = $14,062 

 $.25 X 56.2495 (lbs. overrun) = $14,062 



CREAMERY DIVIDENDS 



Problem 28: 



A creamery with a capital stock of $6,200 receives 184,475 pounds of 

 fat. It pays 30.22 cents per pound for the fat. It makes an overrun 

 of 22.53 P^r cent and sells the butter for an average price of 31.26 cents 

 per pound. The sum of $334.50 is received for buttermilk. The operating 

 expenses amount to $13,793. Itistobeconsideredthat$5,2ooof the$6,2oo 

 capital stock is for building, land, and equipment. With a depreciation in 

 value of 15 per cent on the $5,200, what dividend could be declared? 



Note: The amount of butter made, the overrun, prices paid and received, and 

 operatirg expenses are actual creamery figures. 



Usually the depreciation in average creamery property is about 15%. This 15% 

 should be put in a sinking fund to be used in purchasing new apparatus, etc. 



$.3022 X 184,475 = $55,748.34, amount paid for fat 



$55,748.34 + $13,793.00 (expenses) = $69,541.34, total expenditure 



184,475 X -2253 (overrun) = 41,562.21, number of pounds ovemm 



184,475 + 41,562.21 = 226,037.21, number of pounds butter 



$.3126 X 226,037.21 =$70,659.23, receipts for butter 



$70,659.23 + $334-50 (receipts for buttermilk) = $70,993.73 



$70,993-73 — $69,541.34 = $1,452.39, net profit without depreciation 



$5,200 (value of property) X .15 = $780, depreciation 



$1452.39 — $780.00 = $672.39, net profit 



$672.39 -i- $6,200 = .10845 



.10845 X 100= 10.845% dividend, or 10.845 cents on a dollar. Answer. 



COMPUTING THE RATE IN A COOPERATIVE CREAMERY 



In a cooperative creamery the patrons are often paid a certain rate per 

 pound for their fat. This rate is obtained by subtracting the total expenses 

 from the gross receipts and dividing the remainder by the total number 

 of pounds of fat delivered by the patrons. The quotient is the rate to be 

 paid each patron per potmd for his fat. 



Problem 29: 



The following table gives the pounds of milk, fat tests, and pounds of 

 fat delivered by ten creamery patrons. Find the rate and the amount 

 of money due each patron. 



Patron Pounds of Test Pounds 



no. milk (per cent) of f^t 



I I , 500 4.0 60 . 00 



2 1,000 3.9 39.00 



