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448 The financial report as submitted by R. C. Wetmore, treasurer, is as fol- lows: TARE MarRINE REVIEW attention should be called to the facts in the case and to some of the pecul- iarities of the Independent article. COMBINED ASSETS AND LIABILITIES, JUNE 30, 1910. ASSETS, Cost of real estate, buildings, machinery and tools, patterns, patents, models, furniture, fixtures, etc., as per books, including cost of stocks in subsidiary BOW Aniiated COMPANION (5 oe cic cies cies ces eccis teense seine sek Oe ine Viele wearers $17,904,086.12 mundry ponds and stocks, at cost Or less... 65 6s 6 28 AG oe Sesto. oil pos bas one ec oe 884,400.00 Material and supplies, at market values. 5.5... 56 0b eee ce tei ves Sit anen veces ese 510,267.03 Notes and accounts receivable: WOtES TECOIV ADOT fees ay scl ois Cale s os a's 05 tess vaGlonee sheen ot $2,026,918.32 Accounts es ee acs poco s Coes hor nee © ove pair ONNLLACUS «oo 6 seco wc oo bo op tepin wa oPein le wens sues 5 . Accrued on uncompleted c 4,728,796.86 se ols co Sev oe Wins Hees isis le ee 902,045.02 $24,929,615.03 LIABILITIES, Capital stock: MCOMAMION iyo oe a eee ecb epics cob MU POLED Gab he ee es 7,600,000.00 ROL OECOC cre air Oe ir oo os 0 ela oi lele 5.8 o's wile ele hou Sheds eee ee 7,900,000.00 ------------ 15,500,000.00 Wooten: ang accounts. payable 4. oi ee es Vee eh eed 1,166,518.71 Reserves: ee POLS ATU AN CO se oe es ob oe ie se Nes Bebe bvieabe bcs tie wens 209,707.49 POY MaiiCHAnCee ey vob coe rene eo ke hrs Vee si Ue One ewe Ces - 500,000.00 For: dividends <Cpayable July 15) 0 ccc os adic ces swe g © 138,250.00 For contingent earnings on unfinished construction, 1909-10...... 100,000.00 For sundries (taxes, liability insurance, expenses, discounts, allow- BUCCS CUCU seer oe 5 bates eles Koh ek sb os be bie cae oa uses 311,164.10 ree 1,259,121.59 Surplus, including working capital: Balance, sie 301909 oe cares o Savina Ue hee ss hoe eae 6,423,652.46 MOSS COMMON CWidends 6. sey cs ces 6 baci y cc cus i osu uie eee ~ 304,000.00 Surplus for year ending June 30, 1910: 6,119,652.46 Earnings, including $100,000.00 contingent earnings on unfinished construction 1908-9 (before de- ducting maintenance and depreciation)...........6. $1,980,654.21 Less: POSURE ANCE es ss ce sce s vat ea bs oaks $272,032.19 MebUilding, docks, ets... 5.1... ees cs 271,299.75 ------ 543,331.94 : $1,437,322.27 Less preferred dividends .............. 553,000.00 ----------._ $_ 884,322.27 ----------_ $ 7, 003,974.73 $24,929,615.03 Note:--In addition to the foregoing there exists a contingent liability from the guarantee of first mortgage bonds on steamships built by the company, aggregating $1,535,000, and car- _ fying interest. : Mr. Newberry and Shop Yard Management In its October issue, THE MARINE RE- VIEW reprinted an article from The In- dependent, by Rear Admiral Caspar F. Goodrich, on "Mr. Newberry and Shop Yard Management." Brief reference to the article in the Army and Navy Jour- nal drew comments from Rear Admiral George W. Melville which make quite interesting reading: "The reference in the issue of the Army and, Navy Journal of Sept. 24 to a brief article by Admiral Goodrich in the Independent of Sept. 15 may have led some who would not otherwise have seen it to look it up. The ad- miral has long been known as a clever writer, and as such he has the art of giving a specious attractiveness to ideas that are either inaccurate, irrele- vant or else of the kind that have the same general acceptance as the Ten Commandments. Inasmuch as the ad- _miral was, perhaps, the chief lieuten- ant of ex-Secretary Newberry in the abortive attempt to carry out what has been called 'the plan to disorganize the navy,' no one can blame him for frequent efforts to defend that scheme; but it is only fair, in the interest of accuracy and correct information, that "In the first place, the bulk of the article is taken up with a partial de- scription and some examples of a most ingenious scheme of shop management, devised by one of our most brilliant engineers, but which, unfortunately, in the judgment of most competent. ex- perts, is entirely unadapted to the con- ditions of navy yard work. It would seem that any experienced naval of- ficer ought to recognize that navy yards are unlike manufacturing estab- lishments, which are employed almost entirely on repetition work, while the yards hardly have any two jobs ex- actly alike. Practically all shop 'sys- tems' are based on the idea of repeti- tion work, and the one which the ad- miral so justly admires for its ingenu- ity is particularly so. It is further to be said that, although this system re- ceives general admiration from shop managers, they do not adopt it, recog- nizing that, unfortunately, only such talented men as its brilliant author can make it work. "The admiral sketches an outline of a course of training for shop manag- ers, which, with one addition (which he perhaps thought insignificant), would probably meet with general opproval. This addition is 'common sense,' which the most competent men now- - and localities. November, 1910 adays are ranking higher than mental ability. Indeed, it has seemed to me right along that the Newberry system was wrecked just because it utterly ignored this vital element. Common sense would have suggested a careful investigation as to the methods em- ployed by our great manufacturing and building establishments, as far as appii- cable to navy yard conditions, but thére was no such investigation, if we can judge by results, because the Newberry system was unlike anything» to be found anywhere. Indeed, the particu- "lar point to which the admiral refers with pride, the consolidation and con- centration of shops,. is exactly what the most progressive establishments are not doing. On the contrary, they are working. toward the general lines on which the navy yards were con- ducted before the Newberry scheme: "The little episode about the $50,000 superintendent is splendidly told, and it would convince anyone who didn't know what salaries really are paid. I do not doubt the admiral's account is correct, but it would have been still more interesting if he had given names My opportunities for information in this respect have been very good, and I am free to say:that I do not believe any such salary has ever been paid. There is one good feature about this part of the discus- sion, namely, the disclosure of one naval officer of extreme modesty as to the ability of naval officers gen- erally. We used to hear it charged against them that they considered their commission a sort of 'divine right,' enabling them to do anything. We now learn that this is all wrong, and that it is doubtful if they can be equal to filling positions which are filled efficiently by men without a tithe of their training and opportunity. Here again, it seems to me, a moderate ap- plication of common sense would have led the admiral to be more hopeful of his brother officers. There are now more than a thousand line engineer officers. The number needed for the chief positions in the navy yards is probably under fifty. To say that, with any kind of decent training, these fifty men cannot be obtained out of a thousand highly trained men, who are picked at the start, is beyond my powers of imagination. One can fancy the joy of any large manufacturing concern that had such a chance. "Looking at the matter soberly, and without any bias, this question of navy yard management is not such a terri- ble puzzle to solve. It is a very old problem, and we have had it solved for a great many years. It only re- quires the usual expert knowledge and poeta ttt >,