52
 

Note A.—The Company makes provision for taxes by accruals of monthly charges against income on the basis of best estimates
available as to the amounts ultimately to be paid. As taxes are paid, adjustments are made in order to reflect in the income account the
differences between accruals previously made and the amounts actually paid. Beginning with the year 1936 includes accruals in connection
with Railroad Retirement Act and Unemployment Insurance.

Note B.—Dividends received from subsidiaries (Companies of which The New York Central Railroad Company owns more than
50% of the Capital stock) and the equity of The New York Central Railroad Company in the net income of such companies in each of
the years 1933 to 1942 were:

Dividends received          Equity of the N.Y.C. R.R. Co.

from Subsidiaries            in net income of Subsidiaries

Year

1933................................................       $1,380,960                              $1,996,785

1934....................................................         1,431.960                                2,542,104

1935.....................................................         4,892,444                                2,085,098

1936.....................................................         2,870,706                                3,838,16-7

1937...................................................         5,695,392                                3,312,492

1938.....................................................            759,472                                1,002,723

1939....................................................         1,698,944                               2,102,587

1940...................................................           2.386,912                                2,551,333

1941.....................................................         3,391,404                               4,262,092

1942.....................................................         3,154,144                                3,759,891

Total.................................................     $27,662,338                            $27,453,272
 

STATEMENT OF PROFIT AND LOSS ACCOUNT FOR

1933                         1934                                  1935

Credit BAL.WCE AT beginning of year..........................     $238,624,521.10        $225,981,639.18                 $199,899,462.26

Credits:

Credit balance transferred from  income........................                 —                            —                          $        115,045.54

Credits from retired road and equipment.......................     $        49,161.74        $       156,846.98                            4J03.04*

Delayed  income  credits......................................                 —                            —                                  290,268.20

Unrefundable   overcharges....................................               26,970.57                  25,764.65                           33,173.60

Donations    ................................................               15,350.51                  30,786.40                             3,328.68

Miscellaneous   credits........................................             116,906.02                564,845.39                       1,823,121.01

Total   credits.........................................     $       208,388.84        $       778,243.42                 $    2,260,833.99

Debits:

Debit balance transferred from income.........................     $    5,412,513.71        $    7,682,334.56                              —

Dividend appropriations of surplus............................                 —                            —                                       —

Surplus appropriated for investment in physical property..........          4,628,657.58                  28,395.00                 $        107,538.20

Debt discount extinguished through surplus (Note A)...........                 —                         526,851.29                           56,306.50

Debits from retired road and equipment (Note B)...............          2,537,057.42             3,234,012.04                      4,748,854.20

Delayed income debits.......................................                 —                     14,907,366.73CNote C)                    —

Miscellaneous debits.........................................             273,042.05                481,460.72                       1,279,253.91

Total debits..........................................     $  12,851,270.76        $ 26,860,420.34                 $    6,191,952.81

Credit balance .-.t end of year.................................     $225,981,639.18        $199,899,462.26                 $195,968,343.44
 

* Debit.

Note A.—Represents unamortized discount, commission and expense on funded debt. Prior to 1932 it was the Company's policy
to amortize debt discount and expense over the life of the debt concerned by charges to income and since that time it has been and now is
the policy to charge debt discount and expense directly to profit and loss when incurred.

Note B.—For the year 1936 and subsequent thereto represents ledger value, less net salvage recovered, of roadway property not
required for transportation service retired during the year.

Note C.—By authority of the Interstate Commerce Commission charges aggregating $14,907,366.73 in connection with the voluntary
retirement of equipment, instead of being included in operating expenses for the year, were carried directly to profit and loss.