230 HERBERT F. DE BOWER 



The bids run up until he gets the loan for a premium of 5 per 

 cent. This $50 is taken from the full amount of the loan, leav- 

 ing the borrower with $950 and yet obligated to pay the $1,000 

 principal and interest on that sum at 6 per cent. In the mean- 

 time, at $1 a share each month, his dues are $60 a year, and his 

 interest and his dues are continued until he can withdraw or 

 until his shares mature and are canceled. In the meantime 

 his security for the loan has been a first mortgage upon the 

 property into which the $950 first went. 



In some companies the plan of determining the borrower 

 is decided by the bidding system, but in another way. The 

 man who will come forward with the largest number of dues 

 to be paid in advance, accompanying these with the greatest 

 sum of interest in advance, gets the loan. His dues are settled 

 in advance for that period and no more interest is paid until 

 the advance interest has been absorbed. 



But if a hundred plans for deciding upon the borrower 

 have been necessary, the twenty six or more plans for the dis- 

 tribution of profits to the memberships have been even more 

 interesting and complicated to the casual demonstrator in 

 arithmetical calculations. 



It was with the adoption of the new series idea that these 

 figures became troublesome. Sometimes an association has 

 found it necessary to issue a new share series every quarter. 

 How to adjust the profits to each member has been difficult of 

 solution. Out of the twenty six processes that have evolved, 

 one is indicative of the general scheme. 



For illustration, it will be considered that an association 

 has completed its fourth year, having issued four series of 

 shares on the first of each January, and is preparing for a dis- 

 tribution of $3,000 profits for the fourth year. In the first 

 year 500 shares were issued, 600 shares in the second year, 400 

 shares in the third, and 500 shares in the fourth year, the pay- 

 ments being $1 a month for each share. 



At the end of this fourth year under consideration the 

 man who made a first payment on his shares has paid in $48, 

 and there were 500 of these men, according to the illustration. 

 Then through the whole four years the total dues on the four 

 series paid in would stand: 



