1. Examine the above certificate. What part of the entire stock of the Werner School Book Company would the owner of one hundred shares have?

2. A 3% dividend would require how much money from the treasury of the Company? How much money should the owner of one hundred shares receive?

3. If the owner of five hundred shares sold his stock at a premium of 8% how much should he receive for it?

4. If a 4 % dividend is declared how much money should the owner of seven hundred and fifty shares of stock receive as his share of the dividend?

Stocks.

268. HISTORY OF A STOCK COMPANY.

The farmers of a certain community agreed to combine in the building and management of a creamery. It was determined that a capital of $5000 was necessary. This was

divided into 50 shares of $100 each. Men then came forward and contributed as follows.

A took 5 shares and paid in $500.
B took 3 shares and paid in $300.
C took 6 shares and paid in $600.
D took 4 shares and paid in $400.
E took 7 shares and paid in $700.
F took 2 shares and paid in $200.

G took 10 shares and paid in $1000.

H, I, J, K, L, M, N, O, P, Q, R, S, & T, took 1 share

each and paid in $100 each.

(a) At the end of the first year the directors declared an 8% dividend. How much did A receive? B? C? K?

(b) What was the entire amount of the money divided among the stock-holders at the end of the first year?

(c) Soon after this dividend was paid, A sold his stock to X at a premium of 10 %. How much did A receive for his stock?

(d) At the end of the second year the profits were found to be comparatively small, and the directors could pay only a 3% dividend. How much did X receive? B? C? K? (e) What was the entire amount of the money divided among the stock-holders at the end of the second year?

(f) Soon after this dividend was paid, B, C, D, E, and F, sold their stock to Y at a discount of 10 %. How much did this stock cost Y?

(g) At the end of the third year, the profits were so small that no dividend was declared. The stock-holders became

HISTORY OF A STOCK COMPANY, CONTINUED. disheartened and many of them offered to sell their stock at a large discount. Z appeared in the market and bought at "50¢ on the dollar" all the stock of the company except that owned by X and Y. How much did this stock cost Z?

(h) At the end of the fourth year, the directors, X, Y, and Z, declared a 10% dividend. How much money was divided and how much did each receive?

(i) Before the close of the fifth year, the property burned and the lot upon which it stood was sold. After the insurance money had been received, the book accounts collected, and all debts paid, there remained in the treasury of the company $4350. How much of this money should each stock-holder, X, Y, and Z, receive?

(j) Did this creamery enterprise prove a good investment for X? for Y? for Z? for A? for B? for M?

MISCELLANEOUS PROBLEMS.

1. The directors of a company whose capital is $50000 determined to distribute among the stock-holders $2500 of profits. (a) A dividend of what per cent shall be declared? (b) How much will a man receive who owns 15 100-dollar shares?

2. A company whose capital is $75000 pays a dividend of 3%. (a) How much money is divided among the stockholders? (b) How much does a man receive who owns 6 100dollar shares?

What is

3. Mr. Steele owns 20 shares ($100) in the C., B. & Q. R. R. He receives as his part of a certain dividend $110. the per cent of the dividend?

NOTE.-Stocks are sometimes bought and sold on commission. In such cases the commission is usually reckoned upon the par value as

a base.

Bonds.

269. A bond is a very formal promissory note given by a government or other corporate body, as a railway or a gas company, for money borrowed. Bonds usually have attached to them small certificates called coupons. These are really little notes for the interest that will be due at different times. Thus, a 10-year bond for $1000 with interest at 6 % payable semi-annually will have 20 coupons attached, each calling for $30 of interest.

270. Money invested in bonds yields a specified income; but the income from money invested in stocks depends upon the profits of the company.

271. Bonds, like stocks, are sometimes sold for more than their face value. They are then said to be "above par" or "at a premium." Like stocks, too, they are sometimes below par," or at a discount."

1. What is the semi-annual interest on two 1000-dollar U. S. 5% bonds?

2. What sum should be named on each coupon of a 1000dollar city bond if the interest is payable annually at the rate of 7 % ?

3. To raise the money to build a court-house a certain county issued $50000 worth of 6% ten-year bonds. These sold upon the market at 2 % premium.* (a) How much money was received for the bonds? (b) How much did A

pay, who bought three 1000-dollar bonds? (c) If the interest was payable semi-annually, how much should A receive each 6 months, on this investment?

any

"bonded

4. Has the county or city in which live you indebtedness ? If so, how much, and what is the rate of interest? Did the bonds sell at a premium, at par, or at a discount?

* Premium, discount, interest, and commission are all reckoned on the par value of the bond.

NOTE.-Bonds are made in great variety both as to form and content; but in all, indebtedness is acknowledged, and the amount, rate of interest, and time of payment for both principal and interest, named. The above is a very short and concise form of Bond (much reduced in size) and is an exact copy of one prepared for actual use.

1. Examine the above Bond. If the time it is to run is five years, how many coupons should be attached?

2. If the Bond is dated Jan. 1, 1898, what date should be written in each coupon?

3. If the face of the Bond is $100 and the rate 5 %, what sum should be written in each coupon?

4. If the rate is 5 % per annum, what is the half-yearly interest on a $10,000 bond?