3. To the value of all the shares in force as declared by the last report add eight-thirteenths of the dues paid in during the term for the dividend bearing capital. 4. To the value of all the shares in force as declared by the last report add three-eighths of the dues paid in during the term for the dividend. bearing capital. 5. To the value of all the shares in force as declared by the last report add one-half the dues paid in during the term, not including the last regular payment, for the dividend bearing capital. 6. Shares less than six months old do not participate in the profits. 7. Instead of ascertaining a rate of profit according to the rule, each series' share of the profits is represented by a fraction whose numerator is the dividend bearing capital of the respective series and whose denominator is the total dividend bearing capital of all the series. 8. Profits arising from withdrawals are divided equally among the shares in force of the respective series from which the shares were withdrawn. 9. The profits belonging to the series issued since the last report are kept separate and are divided equally among the shares of that series. 10. The rate of profit is found according to the rule, but this rate is applied upon the dues paid in at last report plus one-half the dues paid in since, previously apportioned profits being disregarded; the remainder of the profit being held in reserve. 11. The rate per cent of profit annually based on the free shares only is found according to the rule, and the board of directors arbitrarily declares what part of said rate shall be distributed to the free shares, the remainder being carried to the reserve fund. The shares borrowed on do not participate in the profits, their dues being credited on the principal of the loan. 12. All of the profits are distributed to the free shares only. The shares borrowed on do not participate in the profits, their dues being credited on the principal of the loan. 13. To the value of the free shares as declared by the last report add one-half the dues paid in during the term on all the shares in force, for the dividend bearing capital. The shares borrowed on receive profits on one-half the dues paid in during the term only. These profits and the dues paid in are credited on the principal of the loan. 14. This variation from the rule is largely used throughout the New England states, and is known as the Eldredge plan. It differs from the rule, in that the rate per cent of profit is not computed in the usual way, but instead the division of profits is based on an assumed rate per cent. This assumed rate of profit is distributed to each share as under the rule. If a portion of the profits still remains undistributed, the profit per share is increased by one-half per cent, one-fourth per cent, etc., according to the amount of profit remaining. To illustrate the plan, suppose the last annual report shows a share of a given series to be worth $38.87, and that a rate of 6 per cent is assumed. $38.87 .06 $2.33, profit on previous value at the assumed rate. $2.69, total profit of the share at the assumed rate. The same computation is made upon all the shares in force of the exist ing series, which gives the total profit of all shares in force at the assumed rate, 6 per cent. If, after deducting this profit from the total profits, it is found that the profits are sufficient to allow 6 per cent instead of 6 per cent, the profit per share is increased one-twelfth; if sufficient to allow 7 per cent, the profit per share is increased one-sixth, etc. 15. The series issued since the last report is given all the entrance fees. The profits arising from withdrawn shares are divided equally among all the shares in force of the series in which the withdrawals took place, and the preceding ones. To illustrate, suppose the withdrawal profit was made in the second series; then such profit would be divided equally among all the shares in force of the first and second series; if the withdrawal profit was made in the third series, it would be divided equally among the shares in force of the first, second, and third series, etc. 16. A fixed rate of interest is allowed upon the value of all the shares in force as declared by the last report plus one-half the dues paid in during the term. The remainder of the profit is arbitrarily divided among all the shares in force, a larger portion being given to the shares of the older series than to those of the younger series. 17. Some permanent associations vary the rule in the following manner: Members may pay more than the regular required weekly or monthly dues, but no dividends are allowed on such overpayments until the close of the current term in which they are paid. Members may also withdraw all or any part of the dues paid or of the dividends declared, future dividends being based on the amount standing to the members' credit at the beginning of the term and on one-half the regular dues paid during the term. The number of associations operating under this plan and its variations is as follows: LOCAL.-Alabama, 1; Arizona, 1; Arkansas, 2; California, 1; Colorado, 1; Connecticut, 4; Delaware, 4; District of Columbia, 1; Illinois, 38; Indiana, 28; Iowa, 3; Kansas, 10; Kentucky, 70; Louisiana, 2; Maine, 5; Maryland, 93; Massachusetts, 65; Michigan, 18; Minnesota, 10; Missouri, 10; Nebraska, 13; New Hampshire, 2; New Jersey, 6; New York, 34; Ohio, 347; Pennsylvania, 42; Rhode Island, 3; Tennessee, 3; Utah, 1; Virginia, 18; West Virginia, 2; Wisconsin, 13; total local associations, 851. tucky, 2; Maryland, 1; Michigan, 1; Nebraska, 2; New York, 2; Ohio, 2; Tennessee, 1; Virginia,3; Wisconsin, 2; total national associations, 24. PLAN 4. 1. To the value of all the shares in force as declared by the last report, add the equated amount of dues paid in during the term. 2. Divide the profits for the term by this sum, for the rate per cent of profit. 3. Multiply each share's investment by the rate per cent of profit, to find the gain on one share. Using the same data as before the result is as follows: ILLUSTRATION. ($38.87 + $6.50, equated ducs), × 500=$22,685, dividend bearing capital of 1st series. ($25.27 +$6.50, equated dues), × 600-$19,062, dividend bearing capital of 24 series. ($12.32+$6.50, equated dues), × 400— $7,528, dividend bearing capital of 3d series. $6.50, equated dues, × 500 – $3,250, dividend bearing capital of 4th series. $52,525, dividend bearing capital of all series. $3,000, the profits for the term, $52,5255.7115, the rate per cent of profit. ($38.87+$6.50) × .057115=$2.59, profit of a share of the first series. ($25.27+$6.50) × .057115=$1.81, profit of a share of the second series. ($12.32 $6.50) x .057115 $1.07, profit of a share of the third series. $6.50 .057115=$0.37, profit of a share of the fourth series. $38.87+$12+ $2.59=$53.46, value of a share of the first series. $25.27+$12+$1.81 = $39.08, value of a share of the second series. $12.32+$12+$1.07 $25.39, value of a share of the third series. $12+ $0.37 $12.37, value of a share of the fourth series. $6.00, profits undivided. This rule is known as Dexter's rule. Some associations arrive at the same results by using the following method: (1) To the value of the shares in force in each series as declared by the last report, add the equated amount of dues paid in each series during the term, and multiply each sum by the number of months in the term, for each series' investment for one month. (2) Find the sum of these products, which gives the entire capital invested for one month, and then divide the profits of the term in the same proportion that each series' investment for one month bears to the entire capital invested for one month, for each series' share of the profits. (3) Divide the profits of each series by the number of shares therein, for the profit of one share. The process is also varied in the following way: The total investment for one month is divided into the total net profits for a rate per cent, which is applied to each series' investment for one month, for the profit of each series. Other variations are the following: 1. An assumed rate of profit (generally 6 per cent) is given on the previous value of the shares and on the equated amount of dues paid in during the term. If a portion of the profits still remains undistributed sufficient to allow one-fourth per cent or one-half per cent more, each share's investment is then allowed this additional rate of profit. 2. Multiply the value of the shares in each series as declared at the last quarterly apportionment by 3 and to these products add twice the amount of dues paid in on each series during the current quarter. Divide each of these sums by 12, for the dividend bearing capital of each series. Divide the net profits of the quarter by the dividend bearing capital of all the series, for the rate per cent of profit. Multiply the dividend bearing capital of each series by the rate per cent of profit, for the profit of each series. Divide the profit of each series by the number of shares in the series, for the profit of a share in the series. Using the same data as before, except that quarterly profits of $707.28 are assumed instead of yearly profits of $3,000, we proceed thus: ($38.87 × 500 × 3) + ($3 × 500 × 2) — 12 = $5,108.75, dividend bearing capital of the first series. ($25.27 × 600 × 3) + ($3 × 600 × 2) 12 — $4,090.50, dividend bearing capital of the second series. ($12.32 × 400 × 3) + ($3 × 400 × 2) — 12 — $1,432.00, dividend bearing capital of - ($3 × 500 × 2) — 12-$250.00, dividend bearing capital of the third series. 3. The profits are distributed to the free shares only. The shares borrowed on do not participate in the profits, their dues being credited on the principal of the loan. 4. Profits arising from entrance fees are divided equally among shares of the respective series in which the shares are taken. the 5. Profits arising from withdrawals are divided equally among the shares of the respective series from which the shares were withdrawn. 6. The dividend bearing capital of the free shares is ascertained according to the rule. The dividend bearing capital of the shares borrowed on consists of the equated amount of dues paid in during the The dues paid in on shares borrowed on during the term, together with the dividends thereon, are credited on the loans. 7. Instead of finding an exact dividend rate, some associations use a fixed rate, which is applied according to the foregoing rule. The remaining profits are divided equally among all the shares or are held in reserve. S. Instead of finding the dividend bearing capital of the series as in last report, plus the equated amount of dues paid in during the term, form the basis for the distribution of the profits. 9. A certain rate of interest is given to each series based on the value of the shares in force as declared by the last report. The premiums received during the term are divided among the series in proportion to the receipts of each series during the term from dues, fines, and the interest allowed on the previous values. The remaining profits are divided among all the shares in accordance with the rule. 10. Payments are made weekly. Each shareholder's weekly payment of dues is multiplied by the number of weeks invested less one and then averaged for the equated investment of each shareholder's dues for the term. Then the equated investment of all the shareholders' dues for the term, added to the amount standing to the credit of the shareholders at the beginning of the term, gives the dividend bearing capital for the term. This capital divided into the profits for the term gives the rate per cent of profit. This rate is then applied to each shareholder's dividend bearing capital to ascertain the amount of profit belonging to each. The number of associations operating under this plan and its variations is as follows: LOCAL.-Arkansas, 3; California, 13; Colorado, 1; Connecticut, 3; Georgia, 1; Idaho, 1; Illinois, 71; Indiana, 7; Iowa, 6; Kansas, 1; Maine, 14; Massachusetts, 47; Michigan, 6; Minnesota, 1; Mississippi, 1; Missouri, 9; Nebraska, 1; New Hampshire, 1; New Jersey, 13; New York, 21; Ohio, 39; Oregon, 1; Pennsylvania, 16; Washington, 5; Wisconsin, 5; total local associations, 287. NATIONAL.-California, 1; Colorado, 1; Georgia, 1; Illinois, 2; Iowa, 5; Minnesota, 2; Missouri, 2; Tennessee, 2; total national associations, 16. PLAN 5. 1. To the previous value of a share in each series add the dues paid in during the term, and multiply the sum by the number of shares in the series. 2. Add these products and then divide the sum into the profits for the term for the rate per cent of profit. Using the same data as in the preceding illustrations, the rule is worked out as follows: ($38.87+$12)×500 $25, 435, dividend bearing capital of the first series. $12 X500: $63, 525, dividend bearing capital of all series. |