Calculating Dividends. 



213 



dividends are calculated at a cheese factory. For the 

 sake of clearness an example is given that applies di- 

 rectly to cheese factories. 



243. Illustration of calculation of dividends. It may be 



assumed that 15,000 libs, of green cheese is made from 150,000 

 Ibs. of milk delivered to a factory in a Inonth. According to the 

 weighings and the tests made, the milk contained 5,700 Ibs. of 

 butter fat. If thei cheese sold at an average price of 7^ cents 

 a pound, the gross receipts would be $1,125.00. The amount to 

 be deducted from the gross receipts will depend on the agree- 

 ment made between the factory operator and the patrons, in 

 case of proprietary cheese factories, or between the shareholders 

 and the maker, when the factory is run on the co operative plan. 

 As before we shall consider these systems separately. 



244. I. Proprietary cheese factories. The owner of the 

 factory generally agrees to make the cheese for a certain price 

 per pound and to pay the patrons what is left after deducting 

 this amount. If the price agreed on is 1^ cents per pound of 

 green cheese, this would amount to $225 in the example given. 

 Subtracting this sum from the gross receipts, $1,125, leaves $900, 

 which is to be paid the patrons. The total amount of butter fat 

 delivered by the patrons was 5,700 Ibs.; hence the price of one 

 pound of butter fat will be 900-^5.700=.1577, or 15.8 cents. 

 Taking the figures for the three patrons already mentioned un- 

 der Creamery Dividends, we then have: 



245. II. Co-operative cheese factories. The method of pay- 

 ment at co-operative cheese factories is nearly the same as that 

 already given, except that a certain sum representing the ex- 

 penses is subtracted from the gross receipts for the cheese, and 

 the balance is divided among the patrons according to the amount 



