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Full text of "Investigation of concentration of economic power. Hearings before the Temporary National Economic Committee, Congress of the United States, Seventy-fifth Congress, third Session [-Seventy-sixth Congress, third Session] pursuant to Public Resolution no. 113 (Seventy-fifth Congress) authorizing and directing a select committee to make a full and complete study and investigation with respect to the concentration of economic power in, and financial control over, production of goods and services .."

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INVESTIGATION OF CONCENTRATION 
OF ECONOMIC POWER 

HEARINGS 

BEFORE THE 

TEMPOBARY NATIONAL ECONOMIC COMMITTEE 
CON&KESS OF THE UNITED STATES 

.^ SEVENTY-SIXTH CONGRESS 

W SECOND SESSION 

PURSUANT TO 

Public Resolution No. 113 
(Seventy-fifth Congress) 

AUTHORIZING AND DIRECTING A SELECT COMMITTEE TO 
MAKE A FULL AND COMPLETE STUDY AND INVESTIGA- 
TION WITH RESPECT TO THE CONCENTRATION OF 
ECONOMIC POWER IN, AND FINANCIAL CONTROL 
OVER, PRODUCTION AND DISTRIBUTION 
OF GOODS AND SERVICES 



PART 17-A 



PETROLEUM INDUSTRY 

REPLIES OF OIL COMPANIES TO THE COMMITTEE 

QUESTIONNAIRE ON FINANCIAL DATA 

AND RELATED TOPICS 



OCTOBER 20, 1939 



Printed for the use- of the Temporary National Economic Committee 




UNITED STATES 
GOVERNMENT PRINTING OFFICE 
124491 WASHINGTON : 1940 



TEMPORARY NATIONAL ECONOMIC COMMITTEE 

(Created pursuant to Public Res. 113, 75th Cong.) 

JOSEPH C. O'MAHONEY, Senator from Wyoming, Chairman 

HATTON W. SUMNERS Representative from Texas, Vice Chairman 

WILLIAM H. KING, Senator from Utah 

WILLIAM E. BORAH, Senator from Idaho 

CLYDE WILLIAMS, Representative from Missouri 

B. CARROLL REECE, Representative from Tennessee 

THTJRMAN W. ARNOLD, Assistant Attorney General 

•WENDELL BERGE, Special Assistant to the Attorney General 

Representing the Department of Justice 

JEROME N. FRANK, Chairman 

•LEON HENDERSON, Commissioner 

Representing the Securities and Exchange Commission 

GARLAND S. FERGUSON, Commisslonei; 

»EWIN L. DAVTS. Commissioner 

Representing the Federal Trade Commission 

ISADOR LUBIN, Commissioner of Labor Statistics 

♦A. FORD HINRICHS. Chief Economist, Bureau of Labor Statistics 

Representing the Department of Labor 

JOSEPH J. O'CONNELL, Jr., Special Assistant to the General Counsel 
Representing the Department of the Treasury 

Representing the Department of Commerce 
JAMES K. BRACKETT, Executive Secretary 
'Alternates 

II 



CONTENTS 



Exhibit No. 1312 

Page 
Statement (A) prepared tor the Temporary National Economic Committee 
by Christopher Del Sesto, Special Assistant to the Attorney General, 
Department of Justice, based upon financial reports and data submitted 

by oil companies in response to the Committee QuestioTinaire 9961 

Restatement of capital stock and revaluations of assets 9963 

The changing concept of surplus of corporations 9967 

Accounting practices and policies 9970 

Representation at stockholders' meetings j__ 9972 

Compensation to officers and directors 9972 

Employee participation plans 9974 

Summary of management's participation plan ot the Texas Corp 9977 

Summary of :efficiency contribution fund 9977 

Tables A to Q — Comparison of compensation paid to oflScers and 
directors, net earnings applicable to common stock, 
and dividends paid on common stock for: 

Atlantic Refining Co 997&^ 

Consolidated Oil Corp 9979 

Continental Oil Co 9979 

Empire Gas & Fuel Co .. 9979 

Gulf Oil Corp 9980 

The Ohio Oil Co 9980 

Phillips Petroleum Co 9981 

The Pure Oil Co 9981 

Shell Union Oil Corp : 9982 

Skelly Oil Co l 9982 

Socony- Vacuum Oil Co., Inc 9982 

Standard Oil Co. (Indiana) 9983 

Standard Oil Co. (New Jersey) 9983 

Standard Oil Co. (Ohio). 9984 

Sun Oil Co 9984 

The Texas Corp 9985 

Union Oil Co. of California : 9985 



Exhibit No. 1313 

Replies to Item 8a of T. N. E. C. Questionnaire — Summary of companies 
reporting that surplus was credited for part of the proceeds received from 
the original issue of capital stock. 

Cities Service Co. (Delaware) 9987 

Consolidated Oil Corp 9988 

The Pure Oil Co 9988 

Socony- Vacuum Oil Co., Inc 9989 

Standard Oil Co. (Indiana) 9990 

Standard Oil Co. (New Jersey) - 9990 

Standard Oil Co. (Ohio) 9991 

The Texas Corp 9991 

Union Oil Co. of California - 9992 



Exhibit No. 1314 

Analysis of shares of capital stock voted at stockholders' meetings: 

Atlantic Refining Co 9993 

Cities Service Co. (Delaware) : 9997 

Continental Oil Co 9998 

Consolidated Oil Corp .1 ^ 9998 

The Gulf Oil Corp 10005 

ni 



IV fJfjXTLXTS 

Analysis of shares of capital stock voted at stockholders' rnr^etings — Con. PaK« 

The Ohio Oil Co 10007 

Phillips Petroleum Co IQOll 

The Pure Oil Co : 10013 

Shell Union Oil Corp.. 10014 

Skelly Oil Co .- 10015 

Soconv-Vacuum Oil Co., Inc 10020 

KtanrJard Oil Co. rinriiana) 10021 

Standard Oil Co. CXew .Jersey) 1 .- 1002.5 

Standard Oil Co. (Ohio; 10026 

Sun Oil Co - - .- 10026 

The Texas Corp 10028 

Tide Water Afisociate^l Oil Co 10030 

Union Oil Co. of Culifor- ia 10032 



Exhibit No. 1315 

Statement (B) prepared for the Temporary National Kcoriomic (Jornrnittee 
by Christopher Del Sesto, Special Assistant txj the Attorney C-eneral, De- 
partment of .Justice, based upon replies of the companies to the Com- 
mittee Questionnaire as to the cost of gasoline at the refinery gate and 
the costing policies of tlie oil companies, and the cla.shiiication of income 
by branches and departments of the business 10033 



Exhibit No. 1316 

Replies to Question 32 of T. N. E. C. Questionnaire pertaining to costs of 
gasoline and costing policies. 

MAJOR COMPAN'lES 

Atlantic defining Co 10047 

Arkansas Fuel Oil Co . 10049 

Cities Service Oil Co. (Pennsylvania) 10050 

Consolidated Oil Corp 100.54 

Continental Oil Co 10055 

Empire Gas and Fuel Co , 10053 

Gulf Oil Corp 10056 

The Ohio Oil Co 10058 

Phillips Petroleum Co 10059 

The Pure Oil Co 10060 

Shell Union Oil Corp 10061 

Skelly Oil Co 10063 

Socony-Vacuum Oil Co 10064 

Standard Oil Co. (Indiana) and subsidiaries 10065 

Standard Oil Co. (Kentucky; 10072 

Standard Oil Co. (New Jersey) 10073 

Humble Oil and Refining Co 10073 

Colonial Beacon Oil Go 10079 

Standard Oil Co. of Louisiana 10082 

Stanrlard Oil Co. of New Jersev_ ^ 10085 

Standard Oil Co. (Ohio) ".. . . 10092 

Sun Oil Co 10092 

The Texas Corp . ... . 10093 

Tide Wa'er Associated Oil Co 10098 

Union Oil Co. of California 10099 

NON-.MAJOR COMPANIES 

.\niefadH Corp 10099 

Auieri<-an Republics Co- 10099 

Ashland Oil and Refining Co _. _ . 10100 

Barnsdall Oil Co . ._. . 10101 

Barusdall Refining Co '"[ 10104 

Chalmette Petroleum Corp.. 1111 10105 

Ch'i.npUn Refining Co " . 10105 

^>,:v]fn Petroicurn ' orp 10105 



CONTENTS V 

ReplicK to Qurst.iun 32 of T. N. E. C. Qiicstiomiai.rc portaiiiiiiK to cost uf 
gatiuliiic and costing policies — Continued. 

NON-MAJOR COMPANIES — Continued 

Hickok Oil Corp 10105 

Houston Oil Co. of Texas 10106 

Kendall Refining Co 10106 

Lion Oil Refining Co 10107 

National Refining Go .._ 10107 

Plymouth Oil Co . 10108 

Quaker State Oil Refining Corp 10109 

Republic Oil Refining Co 10109 

Richfield Oil Corp 10112 

South Penn Oil Co 10112 



Exhibit No. 1317 

Analysis of consolidated assets and consolidated, income, classified by 
branches or departments. 

MAJOR COMPANIES 

Arkansas Fuel Oil Co. and subsidiary - 10115 

Cities Service Oil Co. (Pennsylvania) and subsidiaries 10120 

Consolidated Oil Corp 10129 

Continental Oil Co . . 10132 

Empire Gas and Fuel Co. and subsidiaries 10124 

Gulf OUCoTp... 10135 

The Ohio Oil Co . 10140 

Phillips Petroleum Co -- 10143 

Pure Oil Co . 10147 

Shell Union Oil Corp . 10151 

Skelly OilCo 10154 

Socony- Vacuum Oil Co 10156 

ftandard Oil Co. (Indiana) 10160 

tandard Oil Co. (Ohio) . Facing 10160 

Sun Oil Co -• 10161 

Texas Co : -.-. 10161 

Tide Water Associated Oil Co ." 10162 

Union Oil Co. of California 10163 

NON-MAJOR COMPANIES 

Amerada Corp 10167 

American Republics Corp 10170 

Ashland Oil and Refining Co 10173 

Barnsdall Oil Co . 10176 

Barnsdall Refining Corp 10178 

Chalmette Petroleum Corp 10180 

Champlin Refining Co 10182 

Cosden Petroleum Corp 10185 

Danciger Oil and Refining Co 10187 

Hickok Oil Corp 10189 

Lion Oil Refining Co 10192 

National Refining Co 10194 

Plymouth Oil Co. and Big Lake Oil Corp 10198 

Quaker State Oil Refining Corp 10202 

•Republic Oil Refining Co 10204 

Richfield Oil Corp 10205 

South Penn Oil Co 10207 

Standard Oil Co. in Kentucky 10210 

Standard Oil Co. (Nebraska) 10211 

Valvoline Oil Co 10212 



INVESTIGATION OF CONCENTRATION OF ECONOMIC POWER 



FRIDAY, OCTOBER 20, 1939 

United States Senate, 
Temporary National Economic Committee, 

Washington, D. C. 

EXHIBITS NOS. 1312, 1313, 1314, 1315, 1316, AND 1317 ^ 

Department of Justice, 

Washington. 
Exhibit No. 1312 

Statement Prepared for the Temporary National Economic Committee 

(Based upon financial reports and data submitted by oil companies to the Tem- 
porary National Economic Committee dn response to the Committee's 
questionnaire) 

statement a 

(By Christopher Del Sesto, Special Assistant to the Attorney General, Depart- 
ment of Justice, Washington, D. C.) 

The task assigned to me has been to study and review briefly the financial 
reports and data submitted by oil companies to the Temporary National Economic 
Committee in response to this Committee's questionnaire. 

A resume of the financial data submitted by oil companies has already been 
presented to this Committee as part of the Outline of Economic Data Relating 
to the Petroleum Industry which was submitted to this Committee on the opening 
day of these hearings. (See Exhibit 1139, in Vol. V., No. 16, p. 521 et seq. of 
Record; and Appendix I of Exhibit 1139, in Vol. VI, No. 6, p. 269 et seq. of Record.) 

Some of the more salient financial facts there presented may be reviewed briefly. 

The petroleum industry utilizes at present from 11 to 15 billion dollars of capital. 
Measured by the gross investment in capital assets, the indnstrv has grown from 
6}i billion dollars in 1921 to 14% billion dollars in 1938. 

The investment in the industry is spread over the four branches of the industry 
in approximately the following proportions: production, 45%; transportation, 
15%; refining and manufacturing, 25%; marketing, 15%. 

Earnings in the petroleum industry fluctuate to a greater degree than do the 
earnings of other industries, and the fluctuations are not always synchronous 
with changes in other industries. 

Dividends paid by the principal oil companies during the 15-year period 
1922-1937 averaged about 4% a year while the average for 135 leading industrial 
corporations for the same period averaged better than 5%. 

The petroleum industry is characterized by a relatively small number of large 
enterprises constituting probably two-thirds of the investment in the entire 
industry. The remainder of the industry is made up of thousands of small 
proiducers and marketers and several hundred refining companies. 

' Entered in the record October 20, 1939. See Hearings, Part 17, p. 9606. Eesponsibility for the accur- 
acy of data herein rests with Mr. Del Sesto. 

9961 



g9g2 CONCENTRATION OF ECONOMIC POWER 

These larger units in the petroleum industry are commonly referred to as 
"major companies."* The major companies are twenty in number and were 
incorporated in the following states: 

Delaware '. 9 companies. 

Ohio 3 companies. 

New Jersey --. 2 companies. 

New York , 2 companies. 

Pennsylvania 2 companies. 

California 1 company. 

Indiana i 1 company. 

As of December 31, 1938, the total assets at depreciated value of the twenty 
major oil companies were in excess of 8 billion dollars. During the 15-year 
period, 1924-1938, the total assets of the twenty major oil compianies increased 
from 5 to 8 billion dollars, or an increase of approximately 60%. Some of the 
increase was accounted for by consolidations and mergers.. 

Even among the twenty major oil companies, there is considerable concentration 
of assets among the five leading companies — Standard Oil Company (New Jersey) , 
Socony-Vacuum Oil Company, Incorporated, Standard Oil Company (Indiana), 
The Texas Corporation, and Standard Oil Company of California. Of the ap- 
proximately 8 billion dollars of total assets owned by the twenty major oil com- 
panies, over 60% was, concentrated in the first five major oil companies. 

The average annual earnings of the twenty major oil companies for the 15-year 
period from 1924-1938 amounted to approximately 283.2 million dollars. This 
was equal to 8.9% of the par or stated value of common stock outstanding, and 
was equal to 5.6% of the book value of common stock outstanding (par orjstated 
value plus surplus). During this period, approximately 70% of the net earnings 
applicable to common stock was paid out in dividends and the remaining 30% was 
retained in the business. 

The dividends paid by the major oil. companies during 1924-1938 averaged 6.3% 
annually of the par or stated value of common stock outstanding, and averaged 
4% annually of the book value of common stock outstanding. 

* * * * , * * * 

Important as these facts may be, I believe, however, that this Committee is 
interested in the broad issues presented by the data furnished by the oil companies 
and I would like to discuss these broad issues with you in some detail. 

This Committee is charged with the responsibility of studying the concentration 
of economic wealth and power; and to determine, when concentration does exist 
in an industry, whether such wealth or power is being used efficiently and in the 
public interest. 

1 The twenty major oil companies listed in the order of their total assets as of December 31, 1938, with the 
States and dates of incorporation follow. The names of the companies are their present legal names, 
as reported to the Temporary National Economic Committee. 



Name of Company 


State of Incor- 
poration 


Date of Incorporation 


1. Standard Oil Company ^ 

2. Socony-Vacuum Oil Company, Inc 


New Jersey 

New York 

Indiana 


August 5, 1882. 
August 10.1882. 


3. Standard Oil Company 


June 18, 1889. 


4. The Texas Corporation _• 


Delaware.- 


August 26, 1926. 


5. Standard Oil Co. of California ... 


Delaware 


January 27, 1926. 


6. Gulf Oil Corporation.. 


Pennsylvania 

Delaware 


August 9, 1922. 


7. Cities Service Company 


September 2, 1910. 


Arkansas Fuel Oil Company. 


West Virginia 

Pennsylvania 

Delaware 


March 7, 1912. 


Cities Service Oil Company 


September 15, 1916. 


Empire Gas and Fuel Company 


June 12, 1919. 


8. Shell Union Oil Corporation 


Delaware . . 


February 8, 1922. 


9. Consolidated Oil Corporation.. 


New York 

Delaware 


September 23, 1919. 


10. Phllllps'Petroleum Company 


June 13, 1917. 


11. Tide V^^ater Associated Oil Co 




March 6, 1928. 


12. The Atlantic Refining Company 


Pennsylvania 

Ohio 


AprU 29, 1870. 


13. The Pure Oil Company.... 


April 9, 1914. 


14. Union Oil Company of California.. 


California 


October 17, 1890. 


15. Sun Oil Company 


New Jersey 

Ohio. . 


May 2, 1901. 


16. The Ohio Oil Company. 


July 30, 18S7. 


17. Continental Oil Company... 


Delaware 


October 8, 1020. 


18. The Standard OU Company 


Ohio 


January 10, 1870. 


19. Mid-Continent Petroleum Corp 


Delawan. 


July 9, 1917. 


20. Skelly Oil Company 




August ao, 1910. 









CONCENTRATION OF ECONOMIC POWER 9963 

It has already been amply demonstralod in tlieso hearings thns fur, tliat within 
the petroleum industry there is concentration of economic wealth and power. 
Much of the petroleum industry is concentrated in the hands of the twenty large 
integrated major companies. One of these companies has total assets in excess of 
two billion dollars, and its annual volume of business is in excess of one billion 
dollars. The financial operations of this compan}^ and of most of the other major 
oil companies, exceed those of many large municipalities and States in this coun- 
try. The operations of many of the major oil companies are world-wide in scope. 

Having determined that there is concentration of economic power and wealth, 
the next inquiry is whether such wealth or power has been used efficiently by those 
in control of the major oil companies, and whether such wealth or power has been 
used in the public interest. At the threshold of this inquiry, many obstacles are 
met. 

It is almost impossible to determine the efficiency of the large corporations of 
today. Two factors are largely responsible for this situation: (1) liberal state 
corporation laws, and (2) flexible accounting policies and practices. 

State corporation laws now in force and current accounting practices and policies 
make it comparatively simple for the management of a corporation to show 
earnings and to pay dividends notwithstanding the fact that, from an economic 
point of view, the corporation has been unsuccessful. 

Under present state corporation laws dividends may be paid out of the capital 
contributed by stockholders rather than from earnings. Only a very few states 
require that dividends may be paid only from surplus arising from earnings. 
Thus, a steady dividend record of a corporation is not at all conclusive that the 
management has been successful. 

Under present day accounting practices, management can bury certain current 
operating charges and operating expenses in the surplus account instead of charg- 
ing the current income account; management can write up and write down assets 
at wiU; management can reduce or entirely eliminate certain depreciation and 
depletion charges. It follows, therefore, that a current profit of some kind 
can be reported even though there is actually a shrinkage in the investment 
of stockholders. 

In view of the present corporation laws and current accounting practices, there 
can be no accurate determination of whether the management of a corporation was 
justified in buying or building plants, or in the acquisition of other companies. 
The stockholders of a corporation cannot properly appraise the management's 
action, nor can the public at large determine whether the expansion of large 
corporations by mergers and consolidations is justified and in the public interest. 

Liberal corporation laws and flexible accounting policies, of course, do not obtain 
only in the oil industry. Similar conditions may be found in every large industry 
where corporations raise their funds by the sale of securities to the general public. 
But since the oil industry is dominated by giant corporations, which because of 
their size and importance to the national welfare may be regarded as somewhat 
quasi-public in nature, it seems fitting to discuss this subject in some detail in the 
present hearings. . 

One of the fruits of this investigation should be a detailed study of the limita- 
tions of the state corporation laws now in force, and the weaknesses of current 
accounting practices and policies. 

Unless these deficiences are corrected, it will be impossible to determine whether 
or not the concentration of the wealth of this country in the hands of the few 
managers of large corporations has been beneficial or detrimental to the public 
interest. 

I shall now discuss what I consider to be some of the more important provisions 
in state corporation laws, and some of the current accounting practices and 
policies, which should merit serious consideration on the part of this Committee. 

Restatement of Capital Stock and Revaluations of Assets 

In the early days of the distribution of securities of large corporations among the 
public, investors placed much emphasis in their analysis of the affairs of corpora- 
tions upon their net worth as reflected in balance sheets. At that time it was not 
uncommon for management, from time to time, to inflate artificially the net worth 
of corporations by arbitrarily writing up the book value of assets. This practice, 
known as "stock watering" has now greatly disappeared. It has been supplanted 
by a new practice which is more subtle and yet which has more far-reaching 
effects — the restatement of capital stock, and the write-down or revaluatioii of 
assets. 



9964 OONCENTRATION OF ECONOMIC POWER 

This change in strategy on the part of managers of large corporations has been 
occasioned by the change in the technique in investment analysis. While for- 
merly, the emphasis was placed upon the net worth of a corporation, now the 
emphasis is placed on the earning record of a corporation. Seldom, if ever, do 
financial newspapers now report the book value per share of capital stock as rep- 
resented by the balance sheets of a corporation. Emphasis is given now rather 
to the earnings per share. Seldom is mention made of the fact that in some cases 
the so-called earnings are not in fact earnings, and that actually the contributed 
capital of stockholders is being dissipated. 

The practice of restating of capital stock is a comparatively simple procedure. 
The par of stated value of the capital stock of a corporation is reduced, and the 
amount of reduction transferred to surplus, sometimes designated as capital sur- 
plus. Against this surplus, assets are written off. 

At first blush,'this appears to be an innocent practice, and possibly one to be 
commended on the ground of conservatism. Actually, however, restatements of 
capital stock accompanied by revaluations of properties have the eflfect of por- 
traying more favorable earning results in subsequent years because of the decrease 
in fixed charges such as depreciation, depletion, and amortization. 

In many cases, the principal reason for the write-downs of assets is to obtain 
the favorable effect of reduction of depreciation, depletion, and amortization upon 
the earning statement. Thus, if the plant account is eliminated, future depre- 
ciation charges are also eliminated; if the plant account is reduced, future depre- 
ciation charges are also reduced. If oil wells are written down to one dollar, 
depletion charges in the future are eliminated. 

The elimination or reduction of these fixed charges increases the reported 
earnings of the corporation and gives the appearance of an eflicient and profitable 
corporation,. when in fact the reverse may be true. It is at once apparent that 
the write-down of assets against so-called surplus created by the restatement of 
capital stock might easily be a vehicle for the distortion of operating results and a 
means whereby the management might perpetuate itself in office, notwithstanding 
the fact that management is misleading stockholders into believing that apparent 
earnings are true earnings. 

This phenomenon is not clearly understood by the general public. While 
it is true that the restatements are preceded by notice to the stockholders and are 
accompanied by vote of stockholders, this process is generally a ritualistic pro- 
cedure in the control of the management group. 

Restatements of capital stock are quasi-reorganizations and the practical 
effect is the same as if a corporation had gone through receivership proceedings or 
bankruptcy proceedings. So far as I know, however, there is no State law in this 
country providing for review of any court of such a proceeding. In England, 
however, under the English Companies Act of 1929, it is provided that any 
reduction of share capital must be confirmed by a court. 

This practice of restating capital stock has been indulged in since 1929 by at 
least eight of the twenty leading oil companies. These have included the 
following. 

State of 
Name of Company: incorporation 

Consolidated Oil Corporation New York. 

Continental Oil Company Delaware. 

Mid-Continent Petroleum Corporation Delaware. 

The Q{xLo Oil Company Ohio. 

The Pure Oil Company Ohio. 

Skelly Oil Company Delaware. 

Socony- Vacuum Oil Company, Inc New York. 

Tide Water Associated Oil Company Delaware. 

In addition to the above companies, the Cities Service Company, incorporated 
in Delaware (parent company of Empire Gas and Fuel Company) also restated its 
capital stock during the past year. 

It is not to be implied that this practice is common only in the petroleum 
industry. In view of the fact, however, that the petroleum industry is one of 
the four largest industries of the country and is dominated by large corporations 
which raise their funds from the general public, it 'is no doubt fitting that this 
financial practice should receive the scrutiny of this committee at this time. 

It will be noted that, of the nine corporations named above which have restated 
their capital stock, five were incorporated in the state of Delaware. This Com- 
mittee, therefore, may wish' to consider the role played by present state corpora- 



CONCENTRATION OF ECONOMIC POWER 9965 

tion laws in the concentration of economic wealth and power. While, in fact, 
there is now no federal incorporation law, there is for all practical purposes a kind 
of national incorporation law since the provisions of corporation laws of such states 
as Delaware set the pattern which is followed by other states. 

Some of the companies have engaged in both the practice of stock watering 
when it was the custom to follow that practice and have now changed to the 
current practice of restatement of capital stock. 

This Committee's questionnaire asked the oil companies to explain any restate- 
ments of capital stock during the period from January 1, 1929 to December 31, 
1938. The replies received by the Committee are tabulated below. 

Pure Oil Company. — The Pure Oil Company explained the restatement of 
capital stock in 1932 as follows: 

"On June 4, 1932, the shareholders of the reporting company authorized 
a change in its common shares from shares of a par value or $25 each to an 
equal number of no par value' shares with an assigned value of $10 each. 
The reduction of $15 per share applicable to the outstanding common shares 
aggregated $45,575,550 which amount was credited to paid-in surplus. Con- 
currently, the board of directors authorized a charge to paid-in surplus in the 
amount of $28,083,742.59 in connection with the revaluation of the Company's 
properties." 

At the meeting of June 4, 1932 at which the above restatement was voted, stock- 
holders were represented as follows: 

11,173 shares voted by stockholders in person. 
3,180,395 shares voted by proxy exercised by officers. 

Continental Oil Company. — The Continental Oil Company also restated its 
capital stock. In this connection'it reported to the Temporary National Economic 
Committee as follows: 

"As of October 31, 1932, the officers and others X)f the personnel of the 
Company, working in conjunction with members of the staff of the Com- 
pany's auditors, Messrs. Arthur Young & Company, New York, made an 
appraisal of the properties ^v^.'^ investments of Continental Oil Company 
and subsidiary companies. The results thereof were reviewed by the Board 
of Directors, who approved, and submitted to the stockholders for their 
approval, a revaluation of assets and reserves resulting in a net reduction 
of $61,409,120.50. 

"The stockholders of the Company, at their annual meeting held May 9, 
1933, approved the revaluation, and at the same time approved a plan for 
the revision of the capital structure of the Company through a reduction of 
capital and a change from shares of no par value to the par value of $5 each, 
resulting in a charge to Paid-in Capital and a credit to Capital Surplus in 
the amount of $105,153,900.81. Against this Capital Surplus there was 
charged the above amount of $61,409,120.50 and the accumulated Earned 
Surplus (Deficit) as of December 31, 1932, of $13,693,333.95." 

It will be noted that, as a result of the revision of the Capital structure of the 
Company, a deficit of $13,693,333.95 was eliminated. 

At the meeting of May 9, 1933 at which the above restatement was voted, 
stockholders were represented as follows: 

543 shares voted by stockholders in person. 
2,681,124 shares voted by proxy exercised by officers. 

The Consolidated Oil Corporation restated its capital stock as of January 31, 
1932. It reported to the Temporary National Economic Committee as follows: 

"As at January 31, 1932 the accounts of the reporting company gave effect 
tCh-a, restatement of capital which involved the transfer ot Capital Surplus 
of the amount by which the stated equity of its outstanding Common Stock 
without par value exceeded the nominal value of $5 per share. Such restate- 
ment was approved by the stockholders of the reporting company at a special 
meeting held on March 1, 1932. 

"Common Stock stated equity account per Company's books 
at January 31, 1932 (prior to restatement of capital) repre- 
sented by 6,107,403 shares of company's common stock $251, 315, 390 

Restatement at nominal value of $5, per share 30, 537, 015 

Balance credited to Capital Surplus 220, 778, 376 



9966 



CONCENTRATION OF ECONOMIC POWER 



"The purpose of such restatement at January 31, 1932, was that Capital 
Surplus might be created to enable the directors of the reporting company 
to apply so much thereof as they might deem advisable to writing down the 
valuation of certain assets to values more nearly conforming to then esisting 
economic conditions." 

At the meeting of January 31, 1932, at which the above restatement of capital 
stock was authorized, the stockholders were represented as follows: 

5,673 shares voted in person. 

4,746,695 shares voted by proxy exercised by the management. 

1,827 shares voted by other proxies. 

The Okio Oil Company. — At the annual stockholders' meeting on May 23, 1935, 
the stated capital of The Ohio Oil Company represented by 6,648,052 outstanding 
shares of common stock without par value was reduced from $100,000,000 to 
$60,000,000 and capital surplus of $40,000,000 was created. The Company re- 
ported to the Temporary National Economic Committee that, "the purpose of 
this restatement of capital stock was to create a capital surplus for corporate 
needs." 

At the meeting of May 23, 1935 at which the above restatement was voted 
stockholders were represented as follows: 

J"lil rtlreTor/reTe^ro^k.'.-Jlllvoted by stockholders in person. 

^4'o'k'?2hl';rSf°pre?e™3°sSS':::}^°'«d "^ P-^>- --"--i ".v o»cer.. 

Shelly Oil Copipany. — The Skelly Oil Company reported to the Temporary 
National Economic Committee as follows: 

"On January 3, 1936, the stockholders authorized the reduction of the par 
value of the common stock of the Reporting company from $25 to $15 per 
share, the reduction of the capital of the company by $10 per share on the 
outstanding 1,008,548.6 shares of common stock resulting in the transfer 
of $10;085,486 from capital stock to capital surplus; the application of 
$4,940,351.39 out of capital surplus to eliminate the deficit of like amount 
in earned surplus (deficit) as of September 30, 1935. 

"The purpose of this restatement of capital stock was to provide capital 
surplus out of which could be applied to earned surplus (deficit) as of Sep- 
tember 30, 1935, an amount sufficient, to eliminate the latter.^' 

It is to be noted that, as a result of the restatement of capital stock, a deficit 
of $4,940,351.39 was eliminated. 

At the meeting of the stockholders of January 3, 1936 at which the restate- 
ment was approved, stockholders were represented as follows: 

760,177 shares voted by ofl^cers and directors as proxy. 

Socony-Vacuum Oil Company, Incorporated. — On May 31, 1934, the Socony- 
Vacuum Oil Co., Inc. reduced the par value of the outstanding capital stock from 
$25 to $15 per shares. The effect was a transfer of $317,024,940 from capital 
stock to capital surplus. The Company reported to the Temporary National 
Economic Committee: "The purpose of the reduction was to create capital sur- 
plus against which to charge off goodwill and appreciation of properties." Against 
the capital surplus created there was written off the sum of $228,123,580.68 repre- 
senting goodwill and appreciation of properties. 

At the meeting of the stockholders of May 31, 1934, at which the restatement 
was approved, stockholders were represented as follows in the voting at that 
meeting: 





Shares voted 
by stock- 
holders in 
person 


Shares voted 
by proxy exer- 
cised by other 
than company 

officers and 
directors 


Shares voted 
by proxy exer- 
cised by com- 
pany officers 
and directors 


Election of officers 


38, 070 
38,632 
38,166 
37, 374 


26,323 
26,323 
19,258 
7,225 


22, 990, 178 


Proposition No. 1 


22, 986, 105 


Proposition No. 2.. 


22 985, 438 


Proposition No. 3- 


22 981,855 







rONOENTRATION OF ECONOMIC POWER 9967 

It, in to be tiofod that the restatement in tlie case of 3o(on.v-Varuuni 0\\ Com- 
pany, Inc. occurred subsequent to the merger of the Standard Oil Company of 
New York and the Vacuum Oil Company. It is a fair inference that apparently 
the merger had been consummated on an inflated basis and thus, it was necessary 
to write off approximately a quarter of a billion dollars soon after the merger in 
order to show favorable operating results in the future. 

This has much significance to your Committee. Since mergers and consolida- 
tions are generally accomplished by exchange of securities, there is no realistic 
deterrent to the amount that is paid for the acquisition of other companies, 
particularly when a few years later the properties can be written down at the will 
of the management. 

Tide Water Associated Oil Company. — On May 5, 1932, Tide Water Associated 
Oil Company restated the book value of its common stock to $10 per share which 
created a capital surplus of $34,097,880. At the same time, the company revalued 
its assets and wrote off unrecoverable and intangible items in the sum of $34,097,- 
880. This adjustment fully absorbed the capital surplus created by the restate- 
ment. 

At the meeting of the stockholders of May 5, 1932, at which the above restate- 
ment was approved, stockholders were represented as follows: 

34,407' shares voted by stockholders in person. 

3,895,716 shares voted by proxy by company officers and directors (Manage- 
ment Proxy Committee). 

Mid-Continent Petroleum Corporation. — On May 2, 1934, Mid-Continent 
Petroleum Corporation reduced its capital represented by its outstanding capital 
stock from $55,272,301 to $18,579,120 and changed the par value of its shares 
from no par to $10 par. The amount of the reduction ($23,749,452) was trans- 
ferred from the capital stock account to the capital surplus account. The directors 
were authorized to appraise the assets of the company and to charge any excess of 
book values over the values so determined against the capital surplus. 

This company did not answer the Committee's questionnaire, and hence it is 
not known how stockholders were represented at the meeting of May 2, 1934. 

Cities Service Comjtany. — The experience of Cities Service Company (Delaware), 
parent company of Empire Gas & Fuel Company is summarized as follows in a 
report to the Temporary National Economic Committee: 

"On April 26, 1938, as of December 31, 1937, Cities Service Company 
restated the value of 37,455,670 Common shares of No Par Value, having 
an aggregate stated value of $187,278,350.00, by reducing the same "o 
3,745,567 shares each of the par value of $10.00 with an aggregate par value 
of $37,455,670.00. The reduction amounting to $149,822,680 was recorded 
on the books of the Company by charging Capital Stock $149,822,680 and 
crediting Capital Surplus in like amoimt. 

By resolution of the stockholders of Company adopted on April 26, 1938, 
the Board of Directors was authorized and empowered to make or cause to 
be made appropriate charges against the capital surplus of Cities Service 
Company to enable the following action to be taken: 

(a") the elimination from its corporate balance sheet of Cities "Service 
Company's interest in the undistributed surpluses of its subsidiary cornpanies. 
now carried as an asset; 

(b) reduction to the extent that rflay be deemed appropriate of the carrying 
value of investments in and advances to subsidiaries or the setting up of a 
reserve therefor; 

(c) setting-up of a reserve' against accrued undeclared dividends on the 
preferred and preference stocks of Cities Service Company; and 

(d) provision for other adjustments and contingencies." 

The Changing Concept of Surplus of Corporations 

This Committee, in considering the concentration of economic wealth and 
|)ower, should give some consideration to the changing concept of the surplus of 
corporations, both from a legal and accounting standpoint. Traditionally at least- 
the surplus of a corporation was considered to consist of the accumulated earnings 
of the corporation which had not been disbursed as dividends. This concept is 
gradually disappearing. 

Now there are many mongrel types of surplus, and surplus does not necessarily 
represent accumulated earnings. Sometimes surplus other than true surplus is 



•9968 CONCENTRATION OF ECONOMIC POWER 

given a distinctive title, such as paid-in surplus, capital surplus, or appraisal 
surplus, but this practice is not always followed. While paid-in surjjius, capital 
surplus, and appraisal surplus do not represent earnings, they are nevertheless 
all available for dividends under the laws of many states. 

Many of the present state corporation laws now provide that upon the issuance 
of capital stock, the directors may allocate a part of the proceeds received to paid-in 
surplus. But many of the laws place no restrictions whatsoever on the use of 
paid-in surplus, and such surplus is immediately available for the payment of 
dividends. Thus the moment after a corporation receives the proceeds of the 
sale of its capital stock it may start to pay dividends even though it has trans- 
acted no business whatsoever, and has not earned a single doUar. Or, a corpora- 
tion may acquire the business of another corporation by the issuance of stock; the 
directors within their uncontrolled discretion may allocate a portion of the book 
amount of the stock so issued to paid-in surplus; and immediately pay dividends 
without having to wait for any earnings to accrue. 

Here then is a legal provision which is of invaluable assistance to the manage- 
ment of a corporation that wishes to keep itself in office. It can maintain a steady 
and possibly liberal dividend policy, and the unsuspecting stockholder is lulled 
into security by successive dividend checks not realizing that in some cases he is 
' merely receiving a part of his original investment. 

This loophole in the corporation laws of today is of significance to your Com- 
mittee in studying the concentration of economic wealth and power. While the 
growth of large corporations may not of itself be detrimental to the public interest, 
the possibility that these corporations may be managed by inefficient or self- 
seeking groups is of concern to the public. If directors are trustees of funds of 
the public, there must be adequate standards established in the corporation laws. 
This potentiality of abuse should be eliminated. 

In connection with the hearings on the petroleum industry, this Committee 
requested the major oil companies to indicate whether during the period 1929- 
1938, they had issued any original issue of capital stock and had credited to surplus 
any of the proceeds of the issuance of that stock. Nine of the eighteen reporting 
major oil companies replied that they had. These companies are listed below: 

Cities Service Company. 

Consolidated Oil Corporation. 

Pure Oil Company. 

Socony- Vacuum Oil Company, Inco^orated. 

Standard Oil Company (Indiana). 

Standard Oil Company (New Jersey). 

Standard Oil Company (Ohio). 

The Texas Company. 

Union Oil Company of California. 

The detailed answers of the above companies are included in Appendix I. 
Some of the replies received are summarized as follows: 

During the period 1929-1938, Cities Service Company (Delaware) credited to 
capital surplus over $70,000,000 upon the issuance of capital stock. 

Consolidated Oil Corporation, in connection with the acquisition of the assets 
and business of the Prairie Oil and Gas Company and the Prairie Pipe Line Com- 
pany, recorded the properties acquired on its books at a value of approximately 
$136,000,000. While only $40,500,000 was credited to capital stock, over 
$96,000,000 was placed in the capital surplus account. 

Pure Oil Company credited to surplus the sum of $4,718,000 in connection 
with the issuance of common stock during the period 1936-1937. 

Standard Oil Company (Indiana) during the period 1929-1938, issued stock 
of the par value of approximately $195,000,000. In connection with the issuance 
of this stock, there was credited to capital surplus approximately $88,000,000. 
The largest portion of this amount arose in connection with the issuance of stock 
in exchange for Pan American Petroleum and Transport Company stock in 1929 
and 1930. At the time of that transaction there was credited to capital surplus 
approximately $72,000,000. 

The Standard Oil Company (New Jersey), during the period 1929-1938, issued 
phghtly more than 2,000,000 shares of its common stock. Of the proceeds of 
these shares, approximately $53,000,000 was credited to the capital stock account 
and $47,000,000 to capital surplus. 



CONCENTRATION OF ECONOMIC POWER QQgg 

In 1931, Standard Oil Company (Ohio) issued 62,639 shares common stock to 
acquire the preferred stock of Ajax Corporation. In connection with the issuance 
of this stock, there was credited to surplus $3,760,219. In the same year, there 
was issued 124,028 shares to acquiie the assets of Refiners Oil Company. At the 
time of this transaction there was credited to surplus the sum of $7,445,400. 

The Texas Corporation in 1929 issued 1,404,210 shares of common stock. In 
connection with the issuance of this stock, there was credited to the cai)ital 
surplus account $21,063,150. In 1937, the Texas Corporation issued 1,534,999 
shares of common stock. In connection with this transaction there was credited 
to the capital surplus account $23,043,735. 

The Union Oil Company of California in 1929 and 1930 issued 379,093 shares 
of common stock. Surplus was credited with the difference between the sale 
price of the stock which was $35 per share and the par value of the commcyi 
stock, which was $25 per share. In the aggregate, surplus was credited in the 
sum of $3,799,930. 

In considering the liberal provisions of state corporation laws with jespect to 
surplus, this Committee should also give some attention to the flexible accounting 
policies in connection with surplus. Many corporations are able to maintain 
an appearance of relative stability in current earnings by using the surplus 
account as a convenient "dumping ground" for so-called adjustment and extraor- 
dinary charges. Thus, it is a comparatively simple matter to divert current 
charges from the current income account and through the back door to the 
. surplus account. 

It is not to be implied that the major oil companies wo the originators of 
such a practice, or that the practice is only prevalent in the petroleum industry. 
It exists among many of the larger corporations, but since the practice does exist' 
among the major oil companies, it is a fitting subject for review by this Committee 
at this time. 

Theoretically, at least, the difference between the current earnings, of a com- 
pany and the dividends paid during the year should represent the net increase 
or decrease in surplus. Actually such is not the case as may be determined by 
an examination of Tables 48 (a) to 48 (t) of Appendix I of Exhibit 1138 (volume 
VI No. 6 pp. 364-383) which compare the aggregate earnings, dividends and 
changes in surplus of each of the twenty major oil companies during the period 
1929 to 1938. It will be noted from an examination of these Tables that in many 
years there were apparently substantial surplus adjustments which were not 
reflected through the current income account. 

Some of these surplus adjustments are, no doiibt, due to corrections of wrong 
calculations of profits or losses in earlier years. Notwithstanding this fact, some 
accounting authorities recommend that earnings and expenses omitted in previous 
years should be entered in the current income account of the year in which the 
error is discovered. This is recommended so that the sum of the earnings of 
successive years will show the total earnings. Under present practice it is very 
rare indeed to find a company in which the sum of its annual earnings as repre- 
sented by the current earnings statement actualh' represent the total earnings 
for a period. Other accounting authorities also suggest that, if adjustments are 
necessary because of wrong calculation of profits or losses in earlier yeaie, such 
adjustments should not be buried in the surplus account. Rather, the cffmpany 
should amend its previous financial reports to its stockholders, and submit com- 
parative amended financial reports so that a stockholder may make a proper 
analysis of the earning record of the corporation. 

The use of the surplus account to absorb so-called extraordinary charges can 
easily be used to present a favorable current earning record. Sometimes the net 
earnings are small, and the charges to surplus so large, that it would take little 
difference in opinion among accountants with respect to the propriety of certain 
surplus charges to tip the scales and turn a current profit into a loss. 

Consider the case of Standard Oil Company (New Jersey) for example. It has 
shown a current net profit in each of the ten years from 1929 to 1938 inclusive. 
In 1932, however, it reported to its stockholders a net profit of only $282,865 
out of a gross operating income in excess of $1,000,000,000. But, during the same 
year there were net surplus adjustments of over 21J^ million dollars. If only a 
small portion of the items charged to surplus had been charged against the current 
income account, there would have been no net profit in that year, and a record 
of steady annual earnings would have been broken. 



9970 CONCENTRATION OF ECONOMIC POWER 

Accounting Practices and Policies 

Accounting is a tool by which the efficiency of an enterprise may be determined. 
In the Petroleum Industry, there is no uniform method of accounting in general 
use. Although the American Petroleum Institute has published a uniform system 
of accoimts, it is apparent that such a system has not been generally adopted by 
most of the larger companies in the industry. , 

Not only is there a lack of uniformity of accounting within the industry itself, 
but even individual companies have not maintained consistent accounting policies 
from year to year. Consequently, comparisons of financial data between com- 
panies within the industry and even comparisons of one company's financial re- 
ports of one year with those of another year can not be made on the same basis. 
Because of the great flexibility in accounting policies, it is difficult at times to 
ascertain how much of the reported profits are real and how much are due to 
accounting policies or methods; and whether a reported profit is actually a profit 
or whether it is in fact a loss. Since each company may determine for itself its 
own accoimting policy, and it may vary this policy at will, earnings may be either 
over-stated or under-stated, depending upon the whims of a particular manage- 
ment or the expediencies of the moment. 

It might be pointed out, however, that within the last few years some changes 
in accounting policies in the petroleum industry have been occasioned because of 
the general adoption of proration laws in many of the oil producing states. It 
was formerly the practice on the part of some oil companies to charge against 
current income all drilling costs incurred in connection with oil wells. Since pro- 
ration, many of the companies capitalize these drilling charges and then amortize 
them over the estimated productive life of the oil wells. In some few cases this 
change in policy has had a substantial efi'ect upon the operating results of the 
company. 

Under the provisions of the Securities Act of 1933 and the Securities Exchange 
Act of 1934, and under the regulations of the Securities and Exchange Commis- 
sion, full disclosure must be made of substantial changes in accounting policies. 
This Committee might wish to consider, however, if this safeguard is sufficient 
under all circumstances. Possibly, the statutory authority of the Commission 
should be enlarged so as to enable that Commission to prescribe accounting 
methods and policies of companies under its jurisdiction. 

To illustrate ^le^ffect of changing accoiuiting policies upon the operating re- 
sults of a company, certain excerpts are quoted from the annual reports of some 
of the major oil companies. These excerpts are not intended to be exhaustive 
but are merely illustrative of the.effect of changing accounting policies. 

EMPIRE GAS AND FUEL COMPANY 

Annual Report for 1938. — Effective January 1, 1938, the companies adopted the 
policy (1) of including in income only dividends received from affiliated pipe 
line companies, instead of their proportion of the net income of siich companies, 
(2) in the case of the subsidiary oil companies, of charging against operations 
leasehold development expense including lease rentals (formerly capitalized but 
reserved for in full through the provision for depletion) and dry hole losses and 
contributions, and (3) in the case of Indian Territory Illuminating Oil Company 
(a subsidiary) of providing for depletion of oil producing properties on an overall 
"per barrel" basis and for lease cancellations on a normal cancellation basis. 
These changes in accounting policy brought about a net increase of $318,063.61 
in the net income for the year 1938 in comparison with the result on the basis of 
the' practice previously in effect. 

SOCONY-VACUUM OIL COMPANY, INC. 

Annual Report for 7557.— Effective January 1, 1936, the company's crude oil 
producing subsidiaries in the United States adopted the policy of capitalizing 
intangible development costs incurred after that date and amortizing them on a 
unit basis instead of charging them to income as expended. As a result of this 
change in accounting practice, the net income for the year 1937 is approximately 
$9,280,000 greater than it would have been under the accounting practice followed 
prior to January 1, 1936. The charge for amortization of these intangible costs is 
$1,536,738.75 greater in 1937 than in 1936 and as intangible development costs 
continue to be capitalized, the annual charge to income for amortization thereof 
will similarly increase in future years. 



CONCENTRATION OF ECONOMIC POWER 9971 

Effective January 1, 1937, the basis of depreciating all physical properties 
located in the United States (except certain equipment on producing propertiea 
which was amortized on a unit basis) was revised based on a detailed study by 
the management of the various classes of properties in various locations. The 
new provision for depreciation represents the proportion applicable to the year 
1937 of the amount required to amortize the net depreciated book value of the 
various classes of property over the estimated remaining useful life thereof. As 
a result of this change in policy, the net income for the year 1937 is approximately 
$2,^00,000 greater than it would have been under the accounting practice here- 
tofore followed. 

TIDE WATER ASSOCIATED OIL COMPANY 

Annual Report for 75S5.— Intangible Drilling Costs: Investors frequently com- 
pare statistical and financial reports of petroleum companies. In appraising the 
net income reported for the year, it is important to know the policy of the re- 
porting company regarding accounting for intangible drilling costs for the year 
under review as well as its jxtlicy prior thereto. Prior to the year 1931, a great 
majority of petroleum producing companies, Associated Oil Company and Tide 
Water Oil Company included, charged intangible drilling costs to expense. This 
method of accounting was adopted by the industry generally, inasmuch as current 
operations benefited materially from the initital large production secured from 
many of the new wells. However, curtailment of production of crude oil through 
proration programs and unit plans of operation, adopted about that time by 
various units of the petroleum industry, limited the current production of crude 
oil and deferred the normal recovery of oil reserves over a longer period of time. 
In these circumstances, charging intangible drilling costs to expense so unduly 
burdened current operations that a true picture was not presented to the stock- 
holders. Your subsidiaries, accordingly, changed' their policy of accounting foi 
intangible drilling costs in the^year 1931, as explained in the annual reports for 
that year, and since January 1, 1931, the entire cost of developing oil producing 
properties has been capitalized subject to an amortization charge on current 
production of oil through unit depreciation rates determined for individual 
properties by dividing the total computed economic oil reserves into total develop- 
ment costs. The immediate decrease in operating charges resulting from adoption 
of this policy is partly offset by additional depreciation charges. 

No adjustment has been made on your Companies' books for intangible drilling 
costs charged to expense prior to January 1, 1931. 

STANDARD OIL COMPANY (NEW JERSEY) 

Annual Report for 1934. — Income Account: As the result of the revision in 
the chart of accounts and accounting procedure, in conformity with accepted 
principles of accounting, which became effective on January 1, 1934, the accounts 
for the year 1934 are not strictly comparable with those of previous years. The 
principal changes in the income account so far as they affect comparison for the 
years 1933 and 1934 are a reduction in depreciation rates by certain companies, 
the capitalization of leasing and exploration costs by certain companies, and a 
change in the basis of valuing inventories by certain companies. If the foregoing 
had been dealt with in 1934 as in 1933, the net income for 1934 would have been 
approximately $8,000,000 less. Certain subsidiaries, as previously indicated, 
have been included for the first time in the consolidated accounts for 1934. The 
earnings of such companies amount approximately to $2,000,000. 

The increase in the item of non-operating income is largely due to the consolida- 
tion for the first time of the accounts of the Anglo-American Oil Company Limited 
and the receipt of an initial dividend from Standard- Vacuum Oil Company. 

THE TEXAS COMPANY 

Auditors' Certificate with Annual Report for 1934- — "In accordance with the 
action of the Board of Directors, the following changes in accounting procjHfures 
were effected for the year 1934. 

"1. All inter-company and inter-departmental profits were eliminated frbm 
the book value of inventories, including profits taken on transportation Anr 
certain minor auxiliary operations which were not eliminated in the preceding- 
year. The elimination of such items resulted in a reduction in the book value 
of inventories at December 31, 1933 of $3,947,036.25 by a charge to earned 



124491— iO—pt. 17-A- 



9972 CONCENTRATION OF ECONOMIC POWER 

surplus of that amount, and a credit to profit and loss for the year 1934 of 
$487,688.59. 

"2. In 1934 the company included in profit and loss the unrealized profits 
and losses resulting from the conversion of the net current assets of foreign sub- 
sidiaries into United States dollars. In the preceding year the unrealized con- 
version profit of $5,716,513.83 was credited to earned surplus. The net un- 
realized conversion loss for 1934 amounted to $406,887.32. 

"3. The net loss on property retirements (excess of depreciated value over 
salvage or realizable value, including dismantling and removal costs) amounting 
to $1,870,336.84 for the year 1934 was charged to the reserve for depreciation. 
In the preceding year the retirement loss of $1,918,969.09 was charged to profit 
and loss. 

"4. As of January 1, 1934, the company adopted the policy of capitalizing 
labor and service costs of drilling producing wells and amortizing such costs on 
the basis of 8% per annum (the rate used in depreciating well casing). The 
amortization charge for 1934 amounted to $116,827.48 and represents the amorti- 
zation of drilling costs capitalized only for the year 1934, these costs having been 
charged to expense in prior years as incurred. 

"If drilling costs had been charged to expense in 1934 as in prior years, the net 
profits would have been reduced $2,578,094.40." 

* * * * * * * 

Representation at Stockholder's Meetings 

^ The Temporary National Economic Committee, in an effort to determine the 
extent to which stockholders participated in stockholders' meetings, requested 
major oil companies to submit data in connection with all meetings of stock- 
holders during the period from 1929-1938, showing the manner in which the stock 
was voted. The Committee requested that the companies report the number of 
shares of capital stock voted by stockholders in person; the number of shares of 
capital stock voted by proxy exercised by company officers and directors; the 
number of shares voted by proxy exercised by other than company officers and 
directors; and the total number of shares of stock voted by each officer and director 
at each meeting, both as to personal holdings and by proxy. 

The detailed replies furnished by the 18 reporting niajor oil companies are 
included in Appendix II. 

The replies received from the major oil companies indicate conclusively that 
the management participates practically alone at stockholders' meetings and that 
on the average stock represented at stockholders' meetings by persons other than 
the management represents less than one per cent of the total. 

The replies also indicate, in the case of many of the major oil companies that 
it is the practice even among the officers and directors to give proxies on the stock 
owned by them to the Proxy Committ'^e. Thus, it is apparent that for all prac- 
tical purposes, large corporations arc in the control of the management group 
with no interference or supervision on the part of the great body of stockholders. 

This fact, no doubt, has a serious bearing on the study which this Committee 
is making, on the concentration of economic wealth and power in the hands of 
the few managers of large corporations. 

Compensation of Officers and Directors 

Related to the problem of the control of large corporations on the part of the 
management group, who generally have a relatively small proportion of the total 
investment in the corporations, is the question: How does the management 
benefit from the operation of the corporations in comparison with the benefits 
received by the stockholders themselves? 

In an effort to ascertain a comparison of the compensation paid to the man- 
agement group of the major oil companies, with the net earnings applicable to 
common stock, and dividends paid on common stock, the Temporary National 
Economic Commi,ttee submitted questionnaires to the twenty major oil com- 
panies asking for the total compensation paid to all officers and directors of the 
parent company and its cubsidiaries during the period, 1929-1938. 

Seventeen of the major oil companies furnished the data. Of the three com- 
panies that did not furnish any data, two of them, Standard Oil Company of 
California and Mid-Continent Petroleum Corporation, did not reply to the Com- 
mittee's questionnaire. The third Company, Tide Water Associated Oil Com- 
pany, .indicated that it was assembling the data and asked for a clarification of 



CONCENTRATION OF ECONOMIC POWER 9973 

certain items of the questionnaire, but at the time of this report it had not sent 
its reply to the Committee. 

Comparison of the compensation paiti to oHicers and directors with the net 
earnings applicable to common stock and with dividends paid on common stock 
are shown in the accompanying Tables A to Q. inclusive. 

From an analysis of the comparisons, certain generalizations can be drawn. 

(1) Compensation paid to the management group does not flu,^i.iate in 

direct proportion to either the net earnings applicable to the stock 
holders or the dividends paid to the common stockholders; 

(2) Compensation paid to the officers and directors are more stable, and do 

not fluctuate as widely as either net earnings, or common stock 
dividends. 

(3) In 1938 the trend of compensation paid to oflBcers and directors was 

generally on a higher level than that of 1929, while the net earnings 
were on a lower level than that of the earnings of 1929. 

A summary of the comparison of 1938 with 1929 for each of the seventeen 
reporting major oil companies follows: 

The Atlantic Refining Company. — Net earnings applicable to common stock in 
1938 were 22.3% of those for 1929; dividends on common stock in 1938 equaled 
53.2% of the dividends paid in 1929; while compensation to officers and directors 
in 1938 equaled 92.4% of the compensation paid in 1929. 

Consolidated Oil Corporation. — Net earnings applicable to common stock in 
1938 were 48.7% of those for 1929; dividends on common stock in 1938 equaled 
75.0% of the dividends paid in 1929; while compensation to officers and directors 
in 1938 equaled 137.7% of the compensation paid in 1929. 

Continental Oil Company. — Net earnings applicable to common stock in 1938 
were 56.7% of those for 1929; dividends paid oii common stock in 1938 were 
$4,682,387, in 1929 no dividends were paid on common stock; compensation to 
officers and directors in 1938 equaled 55.4% of the compensation paid in 1929. 

Empire Gas and Fuel Company. — Net earnings applicable to common stock in 
1938 were 25.6% of those for 1929; no dividends on common stock were paid in 
1938, while dividends paid in 1929 amounted to $4,500,000; however, compen- 
sation to officers and directors in 1938 equaled 141.6% of the compensation 
paid in 1929. 

Gulf Oil Corporation. — Net earnings applicable to common stock in 1938 were 
29.2% of those for 1929; dividends on common stock in 1938 equaled 134.0% 
of the dividends paid in 1929; whUe compensation to oflBcers and directors in 
1938 equaled 180.6% of the compensation paid in 1929. 

The Ohio Oil Company. — Net earnings applicable to common stock in 1938 
were 13.0% of those for 1929; dividends on common stock for 1938 equaled 
20.0% of the dividends paid in 1929; while compensation to oflBcers and directors 
in 1938 equaled 158.1% of the compensation paid in 1929. 

Phillips Petroleum Company. — Net earnings applicable to common stock in 
1938 were 68.2% of those for 1929; cash and stock dividends on common stock 
in 1938 equaled 103.9% of the combined dividends paid in 1929; ^ while com- 
pensation to officers and directors in 1938 equaled 183.9% of the compensation 
paid in 1929. 

The Pure Oil Company. — Net earnings applicable to common stock in 1938 were 
16.1% of those for 1929; no dividends were paid on common stock in 1938, while 
dividends paid in 1929 amounted to $2,278,870. However, compensation to 
officers and. directors in 1938 equaled 63.5% of the compensation paid' in 1929. 

Shell Union Oil Corporation. — Net earnings applicable to common stock in 
1938 were 57.0% of those for 1929; dividends on common stock in 1938 equaled 
50.0% of the dividends paid in 1929; while compensation to oflBcers and directors 
in 1938 equaled 140.6% of the compensation paid in 1929. 

Skelly Oil Company. — Net earnings applicable to common stock in 1938 were 
37.9% of those for 1J929; diwdends on common stock in 1938 equaled 46% of 
the dividends paid in 1929; while compensation to officers and directors in 1938 
equaled 91 % of the compensation paid in 1929. 

Socony-Vacuum Oil Company, Incorporated. — Net earnings applicable to com- 
mon stock in 1938 were 103.4% of those for 1929; dividends on common stock in 
1938 equaled 56.1% of the dividends paid in 1929; while compensation to oflBcers 
and directors in 1938 equaled 147.4% of the compensation paid in 1929. 

1 In 1929, a stock dividend was also paid inaddition to a cash dlTldend. 



9974 CONCRNTRATrOX OF ECONO^rir POWER 

Slavilnnl Oil Coinpanu (IndiaTiu). ~ Sci carninji.s applirahle lo cuniinon stoi'k 
in 1938 were 35.4% of those for 1929; dividends on common stock in 1938 equaled 
9.3% of the combined dividends paid in 1929;^ while compensation to officers and 
directors in 1938 equaled 81.0% of the compensation paid in 1929. 

Standard Oil Company {New Jersey). — Net earnings applicable to common stock 
in 1938 were 62.9% of those for 1929; combined dividends on common stock for 
1938 2 equaled 107.7% of the dividends paid in 1929; whUe compensation to 
officers and directors in 1938 equaled 68.5% of the compensation paid in 1929. 

Standard Oil Company (Ohio). — Net earnings applicable to common stock in 
1938 were 37.8% of those for 1929; dividends on common stock for 1938 equaled 
53.8% of the dividends paid in 1929; while compensation to officers and directors 
in 1938 equaled 119.9% of the compensation paid in 1929. 

Sun Oil Company. — Net earnings applicable to common stock in 1938 were 
31.6% of those for 1929; dividends on common stock for 1938 equaled 43.9% 
of the combined dividends paid in 1929;^ while compensation to officers and 
directors in 1938 equaled 194.3% of the compensation paid in 1929. 

The Texas Corporation. — Net earnings applicable to common stock in 1938 
were 47.8% of those for 1929; dividends on common stock for 1938 equaled 76.3% 
of the dividends paid in 1929; while compensation to officers and directors in 1938 
equaled .89.8% of the compensation paid in 1929. 

Union Oil Company of California. — Net earnings applicable to common stock 
in 1938 were 46.0% of those for 1929; dividends on common stock for 1938 equaled 
62.0% of the combined dividends paid in 1929; ^ while compensation to officers 
and directors in 1938 equaled 94.4% of the compensation paid in 1929. 

Employee Participation Plans 

Seven of the seventeen reporting major oil companies stated that they had 
bonus or profit sharing plans in which the management group during the period 
1929-1938. Some of the plans were not e.xclusively for the management group, 
but were available to all employees of a certain classification whether or not they 
were part of the management group. These seven companies include the fol- 
lowing: Continental Oil Company, Gulf Oil Corporation, Pure Oil Company, 
Shell Union Oil Corporation, Standard Oil Company (New Jersey), Sun Oil 
Company, and The Texas Corporation. 

Standard Oil Company (Indiana) maintains an employee stock purchasing 
plan which it does not consider a profit sharing plan. 

Explanation of the various bonus or profit sharing plans as reported to this 
Committee follow: 

Continental Oil Company. — This Company had additional compensation plans 
during 1936 and 1937. These plans were described by the Company as follows:. 

"Plan for 19S6. — On December 15, 1936, additional compensation was 
paid to officers and employees as follows: 

"(a) Each permanent employee having been employed one year or longer 
on December 1, 1936 received an amount equal to one-half month's salary, 
if on a salary basis, and an amount equal to fourteen days' pay, if on a daily 
wage basis. 

"(b) Each permanent employee having been employed less than one year 
on December 1, 1936 received an amount equal to one-quarter month's 
salary, if on a salary basis, and seven days' pay, if on a daily wage basis." 

"Plan for 19S7. — The bonus or additional compensation plan for 1937 pro- 
vided that if the consolidated net earnings for the twelve months' period 
ending October 31, 1937 should equal or exceed $7,500,000, a fund equal to 
the following percentages of the net earnings would be set aside for the pay- 
ment of such compensation: 

"(a) 4% if the net earnings were $7,500,000 or more but did not exceed 
$10,500,000. 

"(b) 5% if the net earnings were $10,500,000 or more but did not exceod 
$13,500,000. 

"(c) 6% if the net earnings were $13,500,000 or more. 

"Each eligible officer and employee received, as additional compensation 
from the fund so created, that percentage of the salary or wages earned 
by him during the twelve months ended October 31. 1937, v.-hich the fund 
bore to the total payroll for the same period." 

Gulf Oil Corporation. — Gulf Oil Corporation maintains as incentive compensa- 
tion plan. This plan "is to afford those engaged in the service of the Gulf Oil 

> In 1929, a stock dividend wa.i also paid in addition to a cash dividend. 
•In 1938, & stock dividend wa.s paid in addition to a cash dividend. 



CONCENTRATION OF ECONOMIC POWER 9975 

Corporation and its domestic subsidiaries a participation in profits in excess of 
specified earnings on the shares of the Corporation, as additional incentive to 
further efforts on their respective parts in the advancement of the business of the 
Corporation." 

Directors as such do not participate in the Fund but any active officers who are 
also Directors may participate in the fund. 

The employees who are to participate in the Fund and the amounts of their 
respective participation in each year are determined by the Chairman of the 
Board of Directors, if he is not a participant, and if he is a participant, then by a 
committee of the Board of Directors appointed by the Board, no member of 
which committee is entitled to participate in the Fund. 

The Company's explanation of the Fund in part is as follows: 

"At the end of each fiscal year, (which is the calendar j'ear, hereinafter 
referred to as the year), the Consolidated Net income of the Corporation and 
its subsidiaries, before the deduction of any amount allocated to the Incentive 
Compensation Fund, shall be determined by the public accountants who 
audit the Corporation's books. Such Consolidated Net Earnings shall be 
determined after deducting all charges, including provisions for depletion, 
depreciation, amortization, interest and reserves for all taxes, including 
federal income and excess profits taxes. 

"In determining the amount of such Consolidated Net Income, the public 
accountants shall exclude, to the extend that a committee of Directors, 
who are not participants, shall in its discretion deem proper, the whole or 
any part of any item of unusual or non-recurring income or loss not arising 
in the ordinary course of the Corporation's business, or shall assign such 
non-recurring income or loss in part to the current year and the balance to 
subsequent years, as the Committee may direct. 

"From the Consolidated Net Income so determined there shall be further 
deducted an amount equal to $1.50 per share on each share of the common 
stock of the Corporation outstanding at the beginning of the year, with 
proportionate adjustment, as below provided, in the case of share issued for a 
consideration during such year, and the resulting balance so obtained shall be 
regarded, for the purposes of this Plan, as the Surplus Net Income for the year. 

"Out of such Surplus Net Income there shall be paid into the Incentive 
Compensation Fund the following amounts: 

"$.15 on the dollar of the first $1.50 per share of such Surplus Net Income; 

"$.10 on the dollar of the next $1.00 per share of such Surplus Net In- 
come; 

"S.05 on the dollar of the ne.xt $1.00 per share and each succeeding $1.00 
per share of such Surplus Net Income; or the proportionate amount of 
any fraction of a dollar; 

"In the event of the issuance for a consideration of additional common 
shares during any year, the amount to be deducted from Consolidated Net 
Income before computing the amount to be paid into the Incentive Compensa- 
tion Fund shall be increased at the rate of $1.50 per share per year on such ad- 
ditionaJ shares for such portion of the year as such shares shall be outstanding. 
In the event of stock dividends or a split-up of common shares without pay- 
ment of consideration to the Corporation, the aggregate amount to be de- 
ducted shall not thereby be increased. 

"The amount to be paid into the Fund shall be computed and reported to 
the Board of Directors, by the public accountants who audit the Corpora- 
tion's books and shall be paid into such Fund promptly upon being deter- 
mined. The Board of Directors shall be fully protected in relying upon any 
report made to them by such accountants. 

"To the extent that persons in the employ of subsidiaries shall be desig- 
nated as participants in the Incentive Compensation Fund, it is contemplated 
that the respective subsidiary will be charged with the total of their participa- 
tions, and the Fund credited accordingly." 

In addition the Company has stock purchase plans for employees. 

Pure Oil Company. — Pure Oil Company had an additional compensation plan 
which was authorized on October 30, 1928. The Company reported to the Tem- 
porary National Economic Committee that the year ending March 31, 1930 was 
the last year for which any additional compensation or bonus was distributed under 



9976 CONCENTRATION OF ECONOMIC POWER 

the plan. Copy of the resolution authorizing the plan as submitted to the Tem- 
porary National Economic Committee is as follows: 

"Resolved, That in any fiscal year in which the company has divisible earn- 
ings equal to Four percent on the Common Stock, after all prior accruals and 
charges have been made, additional compensation is authorized to a total 
amount not in excess of Three per cent of the earnings of the Company for 
that year, after all taxes and interest charges have been met and before any 
charges for depletion and depreciation have been made provided, however, 
that said total disbursement shall not under this authority, in any one year, 
exceed Five percent of the total pay roll of the Pure Oil Company and such 
subsidiaries as are consolidated with it in its annual statement. This author- 
ity shall first apply to the fiscal year ending March 31, 1929." 

"Be it Further Resolved, That in such years as the Company does not have 
divisible earnings equal to Four percent on the Common capital stock, addi- 
tional compensation to an amount not to exceed $50,000 may be distributed 
for especially meritorious service to executives, none of whose salaries exceed 
$20,000 per annum." 

Shell Union Oil Corporation. — Shell Union Oil Corporation maintains a Provi- 
dent Fund plan which it described to the Temporary National Economic Com- 
mittee as follows: 

"Salaried officers of the Company do not receive remunerations as directors. 

"The Company is a member of an organization known as 'Het Voorzien- 
ingsfonds der Berbonden Petroleum Maatschappyen' (Provident Fund of the 
Combined Petroleum Companies), domicilied at The Hague, Holland, and 
contributes currently for the account of each member of its staff who is also 
a member of the Provident Fund an amount equal to the amount paid into 
the Provident Fund by such member but not in excess of 10% of the salary 
paid to him, up to a maximum of approximately $960. per annum, in ac- 
cordance with the Regulations of the Provident Fund. Under such Regula- 
tions, the Company may also make, from time to time, further payments into 
the Provident Fund for the account of members of its staff who are members 
of the Provident Fund. All such contributions and payments are included 
in the above figures; however, payments thus made by the company for the 
account of any member of its staff who is a member of the Provident Fund 
cannot be withdrawn so long as such member is in the employ of the Com- 
pany or of any other company whose employees are accredited members of 
such Provident Fund, except upon the conditions stated in said Regulations, 
and, upon termination of services, payment is made only to the extent and 
upon the terms set forth in said Regulations." 

On January 1, 1938 the Corporation introduced a non-contributory pension 
plan under which the Corporation and its subsidiaries contribute currently 
amounts acutarially computed as being necessary to provide for pensions for 
employees upon retirement. 

Standard Oil Company (New Jersey). — In submitting the total compensation 
paid to officers and Directors, Standard Oil (New Jersey) submitted the following 
comments: 

"There has been included in the above figures by the companies whose 
separate figures make the above cornposite total contributions by those 
companies to the credit of their employees' accounts in certain Stock Acqui- 
sition Plans during the years 1929 to 1935 inclusive. 

"There has been included in the above figures by the companies whose 
separate figures make the above composite total payments by those com- 
panies to the credit of their employees' accounts in certain Employees Thrift 
Plans during the years 1936 to 1938 inclusive. The figures include all pay- 
ments by the companies to the Thrift Plans even though a portion of said 
payments was allotted to an insurance company toward the purchase of 
Group Annuity. 

"There has been included in the above figures by the companies whose 
separate figures make the above composite total payments made under a 
Management Profit Sharing Plan approved by the stockholders. These pay- 
ments were made during the years 1929 to 1931 inclusive, and in one in-, 
stance a few payments were made in 1932. In the case of one of the com- 
panies whose payments are thus included, it has been impossible to separate 



CONCENTRATION OF ECONOMIC POWER 9977 

payments made to employees who are not officers or directors; therefore with 
respect to that company the total amount disbursed has I)cen included. 

The total amounts disbursed by that company were as follows: 

1929 $160,000 

1930 190, 000 

1931 80,000 

1932 45.000 

"There has not been included in the above amounts any payments made 
by the companies whose payments make up the composite total in a Con- 
tributory Annuity Plan during the years 1932 to 1935 inclusive. These 
payments have been excluded because they were not credited to employees 
accounts but were placed in an annuity reserve on the basis of a certain per- 
cent of the payroll. 

"Employees receive no vested right in these company contributions." 

Sun Oil Company. — The profit-sharing plans of Sun Oil Company were sum- 
marized in its reply to the Temporary National Economic Committee as follows: 

"In the years 1930 and 1931, and from 1934 to 1938, inclusive, the Sun 
Oil Company had in effect a profit sharing plan covering certain executives 
and employees in responsible positions. In this respect a sum equal to 5% 
of the income in excess of 7% of the invested capital for the year was set 
aside as extra compensation to be paid to the executives and employees de- 
termined as eligible by the officers of the company." 

The Texas Corporation. — Tlie Texas Corporation has maintained a Manage- 
ment's Participating Plan and an Efficiency Contribution Fund. These are 
explained as follows by the Company to th^ Temporary National Economic 
Committee: 

Summary of Management's Participating Plan of the Texas Corporation 

"The Texas Corporation adopted, eflfective for the years 1928 and 1929, a 
Management's Participating Plan as a reward for certain of the directors, officers 
and employees of its subsidiary companies who contributed to its success in a 
special degree by their industry, loyalty or special service by establishing a 
special trust fund in each of these two years consisting of 5% of the net earnings in 
excess of the 6% of the average invested capital of the corporation and its sub- 
sidiaries for each year. This fund was paid over to a trustee, selected by the 
Board of Directors, and was distributed as follows: 

\ a. 5% of the fund in cash to those members of the Executive Committee 
who were neither salaried officers nor employees of the corporation or 
any of its subsidiaries. 

b. 40% of the balance to such elected officers of The Texas Company as were 

selected. This distribution was made in stock of The Texas Cor- 
poration. 

c. The remainder of the fund was invested in stock of The Texas Corpora- 

tion and this stock awarded to other officers and employees of The 
Texas Corporation or its subsidiaries as selected. 

"This plan, by order of the Board of Directors was discontinued in December 
1933, and was only in effect covering earings for the years 1928 and 1929." 

Summary of Efficiency Contribution Fund 

"The Board of Directors of The Texas Company authorized the Operating 
Committee, consisting of the President, the Vice Presidents located in New York 
and the General Counsel, together with others who from time to time were 
designated as members, to distribute beginning with the year 1929, not exceeding 
$100,000, to such employees as in the discretion of the committee should receive 
special consideration because of their contributions to greater efficiency. 

"This amount was invested in stock of The Texas Corporation and distributed 
to employees in each of the years 1929 and 1930. There was one exception 
to the above, namely a payment of cash to one employee amounting to $5,000.00. 
This plan was likewise discontinued by the Board of Directors in December 1933, 
and distributions were only made in the two years above named." 



9978 



CONCENTRATION OF ECONOMIC POWER 



Standard Oil Compan)/ (Indiana). -This company inaiiitaii>c<l an E]npl<>y<'e's 
Stock Purchasing Plans which are described by the Company as follows to the 
Temporary National Economic Committee: 

"During the period from April 1, 1921 to June 30, 1938, the Standard Oil 
Company had in effect five so-called Employees Stock Purchasing Plans, 
the First Plan was for five years, and the last four for three years each. 

<<* * * Under all Plans the Trustees could from time to time purchase 
stock from the Standard Oil Company at a price fixed by the Board of 
Directors of the Company as of January 1, and July 1, each year, which 
prices were substantially the average market price of the stock during the 
previous three months, provided, however, that in no case could the price be 
fixed below the par value of the stock. Price so fixed covered all purchases 
from the company during the ensuing six months. Effective April 27, 1931, 
the Third Plan was amended and the Fourth and Fifth Plans provided that 
the Trustees could purchase their requirements from the company at prices 
to be fixed as above provided, or at the option of the Trustees they could 
purchase their requirements in the open stock market at prices not to exceed 
that at which stock was sold in the open market. 

"None of the Plans were ever considered to be 'profit-sharing', because 
they did not so operate. They were in the nature of an investment, with a 
definite speculative factor In fact, the employees who participated through- 
out the Third and Fourth Plans found at the conclusion of each, that the 
market value of the stock obtained was not equivalent to the contributions 
made. This was not contemplated nor intended, but the unprecedented 
behavior of the stock market brought this result. The Fifth Plan was 
amended as mentioned above, to make this result far less probable, butTione- 
the-less not impossible None of the Plans were ever considered as 're- 
muneration' to the officers or directors, because the Plan was open to all 
employees complying with simple eligibility requirements, none of which 
requirements had anything to do with being an officer or director of the 
company. 

"It will be noted that the Plans were also applicable to the employees of 
certain subsidiaries — subject always to the letter's approval by its directors 
and stockholders." 



Table A. — The Atlantic Refining Company and subsidiaries — Comparison of com- 
pensation paid to officers and directors, net earnings applicable to common stock, 
and dividends paid on common stock 



1929-1938 



Year 


Payments to Officers 
and Directors ' 


Net Earnings Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amount 


Index Nos. 
1929 = 100 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


1929 


$440,000 
432, 500 
432, 533 
357,754 
337, 172 
419,500 
440, 875 
429,000 
434, 249 
406,500 


100.0 
98.3 
98.3 
81.3 
76.6 
95.3 

100.2 
97.5 
98.7 
92.4 


$16,632,418 
2, 742, 688 
513,750 
3, 918, 021 
6, 566, 377 
5,512,10.') 
3, 970. .598 
6, 898, 872 
9, 343, 045 
3, 718. 659 


100. 
16.3 
3.0 
23.5 
39.8 
33.1 
24.1 
41.6 
56.0 
22.3 


$5, 007, 673 
5, 386, 300 
2, 696. 642 
2,696,642 
2,670,611 
2, 666, 428 
2, 670, 806 
3, 335, 500 
2,663,999 
2.663,999 


100.0 


1930 


107.6 


1931 

1932 


53.9 
63.9 


1933 .- 


53.3 


1934 


5.3.2 


1935 


53.3 


1936 


66.6 


1937 


63.2 


1938 


53.2 







,• This includes oflBcers and directors as of December 31st of each year. 



CONCENTRATION OF ECONOMIC POWER 



9979 



Table B. — Consolidated Oil Corporation and subsidiaries — Comparison of com- 
pensation paid to officers and directors, net earnings applicable to common stock, 
and dividends paid on common stock 



Year 


Payments to Officers 
and Directors ■ 


Net Earnings Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929^100 


1929 


$1,281,000 
1, 342, 000 
1, 222, 000 
1,511,000 
1, 563, 000 
1, 558, 000 
1,655,000 
1,819,000 
1,815,000 
1,764,000 


100.0 
104.8 
95.4 
118.0 
122.0 
121.6 
129.2 
142.0 
141.7 
137.7 


$15, 384, 373 

10,874,776 

I (d)23, 353, 313 

899,076 

(d) 727. 172 

269,070 

10, 380, 907 

16, 445, 747 

20,630,004 

7,511,449 


100.0 

70.8 

151.9 

5.8 

4.S 

1.9 

67.5 

106.5 

133.1 

48.7 


$14. 759, 810 

9, 898, 379 

' 1,496,749 


100.0 


1930 


67. 1 


1931. 


10. 1 


1932 




1933 






1934 


.5,886,370 
3.495,088 
13,939,689 
12,522,036 
11,066,863 


39.9 


1935 


23.7 


1936 


94.4 


1937 


84.8 


1938 


75.0 







' Amounts shown are for thirteen month period, ending January 31, 1932. 

Table C. — Continental Oil Company and subsidiaries — Comparison of compensa- 
tion paid to officers and directors, net earnings applicable to common stock and 
dividends paid on common stock 

1929-1938 



Year 



1929. 
1930 
1931. 
1932. 
1933 
1934. 
1936 
1930 
1937. 
1938 



Payments to Officers 
and Directors • 



Amount 



$507, 417 
350, 525 
314, 375 
305, 275 
284,475 
318, 408 
253,417 
> 267, 368 
» 289, 665 
281,036 



Index Nos. 
1929=100 



100.0 
69.1 
62.0 
60.2 
56.1 
62.8 
49.9 
52.7 
57.1 
55.4 



Net Earnings Applicable 
to Common Stock 



$9, 028, 661 

255, 598 

(d) 10, 683, 313 

(d) 1, 444, 133 

2, 275, 860 

4, 865, 358 

8. 813. 561 

9, 612, 697 

13, 948, 460 

5, 139, 765 



Index Nos. 
1929=100 



100.0 

3.3 

-118.9 

-15.6 

25.6 

64.4 

97.8 

106.7 

154.4 

56.7 



Dividends Paid on Com- 
mon Stock 



$2, 341, 275 
4, 097, 150 
5,853,023 
7, 023, 690 
4, 682, 387 



Index Nos. 
1929=100 



(') 



' No index numbers are furnished for dividends, since no dividends were paid in 1929. 
' Includes additional compensation paid under bonus and profit-sharing plans. 

Table D. — Empire Gas & Fuel Company and subsidiaries — Comparison of com- 
pensation paid to officers and directors, net earnings applicable to common stock, 
and dividends paid on common stock 

1929-1938 



Year 



1929.. 
1930- 
1931.. 
1932.. 
1933.. 
1934.. 
1936-. 
1939.. 
1937.. 
1938.. 



Payments to Officers 
and Directors « 



Amount 



$199,249 
196, 309 
194, 965 
172, 595 
147,780 
148,760 
160,028 
166. 292 
258, 746 

282, no 



Index Nos. 
1929=100 



100.0 
98.6 
97.8 
86.6 
74.2 
74.7 
80.3 
83.5 
129.9 
141. C 



Net Earnings Applicable 
to Common Stock 



1 $7, 799, 753 
I 12, 470, 696 
' (d) 3,973,911 
1 1. 678. 004 
» 592. 670 
'2.461.188 
' 6. 269. 748 

> 2. 306. 116 

> 4. 391, 452 
* 2, 027, 414 



Index Nos. 
1929=100 



100.0 
160.3 
-51.3 
20.5 
7.7 
32.1 
67.9 
29.6 
56.4 
25.0 



Dividends Paid on Com- 
mon Stock 



Amount 



.$4, 600, 000 
6, 000, 000 
3,000,000 



Index Nos. 
1929=100 



100.0 
133.3 
66.7 



' Represents net earnings applicable to common stock before minority interest. 

' No dividends paid on preferred stock. Hence earnings are subject to provision for accnied unpaid 
dividends on preferred stock. 



9980 



CONCENTRATION OF ECONOMIC POWER 



Table E. — Gulf Oil Corporation and subsidiaries — Comparison of compensation 
paid to officers and directors, net earnings applicable to common stock and dividends 
paid on common stock 

1929-1938 



Year 


Payments to Officers 
and Directors ' 


Net Earnings Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


1929.... 


$922, 175 

921,500 

961, 050 

" 970, 867 

1,081,050 

1, 121, 100 

2 1,115,863 

< 1, 025, 529 

5 1, 057, 574 
'.1,665,275 


100.0 
99.9 
103.1 
105.3 
117.2 
121.6 
121.0 

111. 2 

114.7 
180.6 


$44, 489, 687 
10, 625, 252 
(d)23,670,052 
2, 743, 492 
(d)n,386,387 
2, 811, 183 
10, 551, 720 

26, -356, 003 
31,854,065 
13,017,076 


100.0 

23.8 

-53.3 

6.1 

-26.6 

6.3 

23.8 

69.3 

71.7 
29.2 


$6, 772, 847 
6, 787, 906 
6, 787, 904 


100.0 


1930 


100.2 


1931 ,. 

1932 


100.2 


1933 






1934 






1935 . - 






1936 


f '113,452,526 

\ 6, 807, 151 

9, 076, 202 

9, 076, 202 


346.3 


1937 


134.0 


1938_ 


134.0 







' Plus 6,753 Shares of Gulf Stock through operation of the Second Stock Purchase Plan (approximately 
2/3 of these shares were paid for by the contributions of persons receiving them) (40 Officers & Directors'). 

2 Plus 92 Shares of Gulf Stock through operation of the Third Stock Purchase Plan. (These shares were 
distributed as the result of withdrawals from the Plan, and approximately 2/3 thereof were paid for by the 
contributions of the persons receiving them) (43 officers and directors). 

3 Represents stock dividend of 100%. 

< Plus 271 Shares of Gulf Stock through operation of the Third Stock Purchase Plan. (These shares were 
distributed as the result of withdrawals from the Plan and approximately 2/3 thereof were paid by the con- 
tributions of the persons receiving them) (38 Officers & Directors). 

« Plus 20,758 Shares of Gulf Stock through operation of the Third Stock Purchase Plan. (Approximately 
2/3 of these shares were paid for by the contributions of persons receiving them (38 Officers & Directors). 

' Including payments under Incentive Compensation Plan. 

Table F. — The Ohio Oil Company and subsidiaries — Comparison of compensation 
paid to officers and directors, net earnings applicable to common stock, and dividends 
paid on common stock 

1929-1938 



Year 


Payments to Officers 
and Directors 


Net Earnings Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


1929 


.f 197, 680 
263, 015 
290, 1.50 
303, 689 
2S5, 269 
267, 869 
267, 815 
272, 191 
291, 036 
312, 510 


100.0 
133. 4 
146. 8 
1.53.6 
144.3 
135. 5 
135. 5 
137. 7 
147.2 
158.1 


$12, 347, 649 
8, 043, 454 

(d)8, 638, 3.59 
3, 838, 404 

(d)3, 510,368 
2, 070, 692 
2,187,071 
4, 593, 109 
8, 573, 645 
1,645,112 


100.0 

65. 

-69. y 

30.9 

— '^■-: 5 


.$6, 563, 441 

10, 420, 664 

1, 668, 953 

3. 296, 427 


100 


1930 . . 


158 8 


1931 


25.4 


1932 


50.2 


19.33 




1934 


17.1 
17.9 
37.4 
69.9 
13.0 


2, 953, 496 
1, 969, 013 

3, 937, 916 
6, 563, 333 
1, 312, 675 


45.0 


19.35 


30.0 


1936... 


60 


1937 


100.0 


1938 


20 







CONCENTRATION OF ECONOMIC POWER 



9981 



Table G. — Phillips Petroleum Company and subsidiaries — Comparison of cnmpen- 
mtion paid to oflicers and directors, net earninqs applicable to ccinriion slock, and 
dividends paid on common stock 

192!>-1938 



Year 


Payments to Officers 
and Directors 


Net Earnings Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100' 


1929 


$288,490 

342, 673 
325, 732 

335, 213 

336, 255 
458, 357 
450, 474 
490, 236 
536, 802 
530, 561 


100.0 

118.8 
112.9 
116. 2' 
116.6 
158.9 
156. 1 
169. 9 
186.1 
183.9 


$1.3, 212, 592 

3, 040, 630 

(d) 5, 576, 409 

755, 766 

1, 500, 695 

5, 757, 308 

13, 421, 703 

17, 875, 489 

24, 113, 874 

9,049,122 


100.0 

22.7 
-42.4 
6.1 
11.4 
43.9 
101.5 
135.6 
182.6 
68.2 


f 2 $4, 579, 425 

\ 3, 983, 390 

6, 444, 400 


} 100.0 
75 3 


1930 


1931 




1932 






1933 






1934 . 


4. 153. 008 

5,188,780 
10,676,356 
12,234,882 

8, 898, 096 


48 5 


1935 


60 6 


1936 


124 7 


1937.. 


142 9 


1938 


103 9 







> Index based on combined cashi and stock dividend. 
* Represents stock dividend. 



Table H. — The Pure Oil Company and subsidiaries — Comparison of compensation 
paid to officers and directors, net earnings applicable to common stock and divi- 
dends paid on common stock 

1929-1938 



Year 


Payments to Officers 
and Directors 


Net Earnings Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


1929 


$607, 148 
537,424' 
395,883 
375, 174 
336, 986 
325, 251 
312, 624 
337, 188 
374, 080 
385, 320 


100.0 
88.5 
65.2 
6L8 
55.5 
53.6 
51.5 
55.5 
61.6 
63.5 


1 $9, 228, 450 

1 4, 603, 433 

1560,879 

(d) 1, 415, 198 

682, 325 

2 (d) 884, 872 

2 8. 150, 027 
i 5, 132, 048 

8, 703, 101 
1, 529, 965 


100.0 

49.5 

6.5 

-15.1 

7.5 

-9.7 

88.2 

54.8 

93.5 

16.1 


1 $2, 278, 870 
1 4, 557, 721 
1 2, 278, 800 


100. () 


1930 .... 


220.0 


1931 _. 


100.0 


1932 




1933 






1934 






1935. 






1936 






1937 


995, 104 


43.7 


1938 











' Amounts shown are as of March 31st, as per annual reports to stockholders. 

2 During 1934 and 1935, no dividends were declared on preferred stock. Earnings in 1934 and 1935 avail- 
able for common stock, are without adjustment for accrued dividends on preferred stock. In 1936, divi- 
dends on preferred stock amounted to $2,526,324. 



9982 



eONCENTR.\TION OF ECONOMIC POWER 



Tabi.k \. Shrll Union Oil Cnrporntion ami. arihsidiaries — Comparison of rnm- 
peiisation paid to officers and directors, ncl carnifigs applicable to common stock, 
and dividends paid on common stock 



1929-1938 



Year 


Payments to Officers 
and Directors ' 


Net Earning.'? Applicable 
to Common Stock 


Dividends Paid on Com- 
- mon Stock 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


1929 


$697, 473 
734, 545 
745, 535 
598, 682 
641, 364 
736, 930 
728, 722 
901, 309 
969, 061 
980, 512 


100.0 
105.3 
106.9 
85.8 
92.0 
105.7 
104.5 
129.2 
138.9 
140.6 


$16, 528, 249 

(d) 7, 295, 574 

(d) 27,008.310 

(d) 4. 288. 496 

(d) 5, 250, 291 

(d) 949, 111 

6, 812, 835 

12, 040, 228 

18. 789, 517 

9, 442, 360 


100.0 

-44.2 

-163.6 

-26.1 

-32.1 

-5.5 

41.2 

72.7 

113.9 

57.0 


$18, 285, 985 
9, 148, 867 


100.0 


1930 - ,. 


50.-0 


1931 




1932 






1933 






1934 






1935 






1936 


3. 267, 656 
13, 070, 625 
9. 149, 438 


17.9 


1937 


71.5 


1938 


50.0 







' Includes payments made under Provident Fund scheme. 



Table J. — Skelly Oil Company and subsidiaries — Comparison of compensation paid 
to officers and directors, net earnings applicable to common stock, and dividends 
paid on common stock 

1929-1938 



Year 


Payments to Officers 
and Directors 


Net Earnings Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amount 


Index Nos. 
1929=100 


Amount 


Indflx Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


1929.... 

1930 


$143, 930 
155, 064 
117,219 
139, 395 
145, 930 
174, 276 
171, 627 
169,823 
143. 583 
130, 952 


100.0 
108.2 
81.4 
96.8 
101.4 
121.1 
119.2 
118.0 
99.8 
91.0 


$5, 786, 490 

1, 413, 472 

(d) 2, 296, 810 

(d) 674, 507 

(d) 820, 534 

713, 577 

2,585,849 

2, 562, 965 

6,189,996 

2,160,380 


100.0 

24.1 

-39.7 

-12.1 

-13.8 

12.1 

44.8 

44.8 

106.9 

37.9 


$2, 165, 305 
2, 130, 670 


100.0 
98.4 


1931 




1932 . . 






1933. 






1934. 






1935. . 






1936 






1937 

1938 :.. 


i, 509, 523 
995, 349 


69.7 
46.0 







Table K. — Socony-Vacuum Oil Company, Inc., and subsidiaries — Comparison of 
compensation paid to officers and directors, net earnings applicable to common 
stock, and dividends paid on common stock ^ 



1929-1938 



Year 


Payments to Officers 
and Directors 


Net Earnings Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos, 
1929 = 100 


1929 


$1,674,211 
2, 000, 023 
3,117,489 
3, 358, 063 
3, 120, 482 
2, 919, 346 
2. 377. 575 
2, 321, 067 
2. 335, 955 
2, 467, 433 


100.0 
119.5 
186.2 
200.6 
186.4 
174.4 
142.0 
138.6 
139.5 
147.4 


$38, 750, 849 

1 40, 246, 198 

(d) 4, 169, 248 

5, 320, 282 

22. 545, 461 

24, 121, 297 

22, 525, 892 

42, 909, 363 

56, 808, 264 

40, 106, 917 


100.0 

103.6 

-10.8 

13.7 

58.0 

62.1 

58.0 

110.6 

146.4 

103.4 


$27, 782, 0.'>3 
28, 501, 379 
43,312,172 
23, 679, 875 
10, 829, 272 
18, 652, 561 
9, 345, 442 
21, 805, 123 
24,920.857 
15, 576, 636 


100.0 


1930 


102. 


1931 


l.'^S. 9 


1932 


85.2 


1933 ... 


39.0 


1934.... 


67.1 


1935 

1936 

1937 


33.6 
78.5 
89.7 


1938 


56.1 







1 Including a net profit of $23,749,471.51 as per income statement on the sale of gas properties. 



CONCENTRATION OF ECONOMIC POWER 



9983 



Table L.— Standard Oil Company (Indiana) and subsidiaries — Comparison of 
compensation paid to officers and directors, net earnings applicable to common 
stock, and dividends paid on common stock 









1929-1938 








Year 


Payments to Officers 
and Directors 


Net EarninEts Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amouut 


Index Nos. 
1929=100 


Amount 


Indpx Nos. 
1029=100 


Amount 


Index Nos. 
1929=100' 


1929- - ---- 


$1, 309, 589 

1, 235, 395 
1, 235, 614 
1,013,387 
1,009,504 
1,004,663 
1,078,779 
1,065,076 
1,040,331 
1,061,325 


100.0 

94.3 
94.4 

77.4 
77.1 
76.7 
82.4 
81.3 
79.4 
81.0 


$78, 499, 754 

46, 371, 438 
17, 596, 396 

16, 558, 282 

17, 674, 351 

18. 949, 680 
30,179,895 
46, 883, 448 

55. 950, 785 
27, 771, 975 


100.0 

59.1 
22.4 
21.1 
22.5 
24.1 
38.5 
59.7 
71.3 
35.4 


f '$116,232, 119 
I 47. 482. 855 
41,607,033 
2.5, 481, 075 
16, 478, 699 
15,688,672 
15,371,229 
15, i42. 372 
36, 418, 793 
35, 075, 524 
15,271,269 


} 100.0 
"5 4 


1930 


1931 


15 6 


1932 - 


iO 1 


1933 


9 6 


1934. 


9 4 


1935 - •. 


9 2 


1936 


22 2 


1937 


21 1 


1938.., 


9 :! 







> Index based on combined cash and stock dividend. 
« Stock dividend. 



Table M. — Standard Oil Company {New Jersey) and subsidiaries — Comparisor{ 
of compensation paid to officers and directors, net earnings applicable to Comtnon 
stock, and dividends paid on common stock 



1929-1938 



Year 


Payments to Officers 
and Directors ' 


Net Earnings Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


Amount ^^^^^ ^^"^• 
Amount 1929=100 


1929 


$5,172,610 
6,387,945 
4,386,170 
3,683,262 
3. 226, 577 
3,092,917 
3,069,275 
3,390,106 
3,607,463 

3, 541, 483 


100.0 
104.2 
84.8 
71.2 
62.4 
59.8 
59.3 
65.5 
69.7 

68.5 


$120, 912, 794 
42, 150, 663 
8, 704, 758 
282, 865 
25, 084, 310 
45, 618, 960 
62,863,192 
97,774, 583 
147, 993, 147 

76,053,170 


100.0 
34.9 
7.2 
0.2 
20.8 
37.7 
62.0 
80.9 
122.4 

02.9 


$46,519,705 

50,929,686 

51, 205, 436 

50, 628, 442 

31,990,916 

31,940,882 

« 50, 634, 434 

52,421,683 

65. 549, 615 

f '10,815,686 

I 39, 329, 769 


100.0 


1030 


109. 5 


1931 


110. 1 


1932... 


1U8. 8 


1933 


68.8 


1934 


68.7 


1935 


108.8 


1936 


112.7 


1937 


140.9 


1938 


23.2 
84.5 





' Includes Payments made under Stock Acquisition Plans, Employees Thrift Plans, and fvlacagenient 
Profit Sharing Plans. 
» Dividend paid included $18,329,913 paid in stock of Mission Corp. and $32,304,521 paid in casli. 
» Represents stock dividend. 



9984 



CONCENTRATION OF ECONOMIC POWER 



Table N. — Standard Oil Company (Ohio) and subsidiaries — Comparison of com- 
pensation paid to officers and directors, net earning appticable to common stock, 
and dividends paid on common stock 

1929-1938 



Year 


Payments to Officers 
and Directors • 


Net Earnings Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


.\mount 


Indox Nos. 
1929=100 


1929 


$187, 000 
232,250 
267,958 
213,668 
217,350 
222,280 
196, 652 
201,710 
207,377 
224,300 


100.0 
124.2 
143.3 
114.3 
116.2 
118.9 
105.2 
107.9 
110.9 
119.9 


$3, 709, 740 

3,116,958 

1, 759, 173 

(d) 1.814,667 

(d) 1.423.357 

(d) 2.513,735 

2, 090, 647 

3, 594. 314 

2,762.960 

1. 364. 605 


100.0 

83.8 

48.6 

-48.6 

-37.8 

-67.6 

66.8 

97.3 

75.7 

37.8 


$1,400; 000 
1.400,379 
1.867,600 
1,503,242 


100.0 


1930 


100 


1931 - -- 


133.4 


1932 


107.4 


1933 




1934. 






1935 






1936 . . -- 


1, 507, 480 

1,130,610 

753, 740 


107 7 


1937....... 


80.8 


1938 


63 8 







Table O. — Sun Oil Company and subsidiaries — Comparison of compensation paid 
to officers and directors, net earnings applicable to common stock, and dividends 
paid on common stock 

1929-1938 



Year 


Payments to Officers 
and Directors 


Net EarninRS Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 1 


1929 

1930' 

1931« 


$330, 964 
473, 781 
449, 405 
488, 783 
493,314 
578,069 
623, .547 

675, 236 

632, 668 
643,079 


100.0 
143.2 
135.8 
147.7 
149.1 
174.7 
188.4 

204.0 

191.2 
194.3 


$7, 942. 537 
7. 19.5, 527 

2, 507, 147 

3, 598, 947 
6. 372. 293 
6. 050. 479 
6, 510. 243 

6. 963. 554 

8,944,085 
2.485,119 


100.0 
91.1 
31.6 
45.6 
81.0 
77.2 
82.3 

88.6 

112.7 
31.6 


f 2 $.3. 968, 282 
\ 1.298.607 
/ 2 4_ 296, 627 
t 1.410.216 
f 1,535,912 
\ 2 1,660,658 
f 1, 535, 682 
t 2 4, 807, 162 
f 1. 576, 506 
1 2 5, 301, 784 
f 1, 722, 602 
1 '4.518.717 
/ 1, 884. 706 
1 2 4, 164, 117 
f 2, 021. 184 
\ 2 5, 885, 103 
2, 144. 336 
2. 315. 786 


1 100.0 
1 108.4 
1 29.2 
} 58.8 
} 121.2 
} 133 4 


1932 


1933. 


19343 


19353 _ 


1 121.6 


1936 3 


} 117.4 
1.^2 5 


1937> 


1938' 


44.0 







1 Index based on combined cash and stock dividend. 

2 Represents stock dividend. 

» Profit sharing plans In effect in years indicated. 



CONCENTRATION OF ECONOMIC POWER 



9985 



Table P. — The Texas Corporation and subsidiaries — Comparison of compensation 
paid to ojficcrti and dircc'ors, net earnings applicable t^ "ommon slock, and dividends 
paid on cummon slock 

1929-1938 



Year 


Payments to OflScers 
and Directors 


Net Earnlnfis Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amount 


Index Nos. 
1929=100 


Amount 


Indes Nos. 
1929=- 100 


Amount 


Index Nos. 
1929-100 


19291 .— 

1930 

1931 


$1, 087, 229 

1, 158, 246 

898,494 

868,824 

916, 518 

935, 412 

933, 602 

1,037,381 

1, 093, 893 

976, 608 


100.0 
106.5 
82.6 
79.9 
84.3 
86.0 
89.9 
95.4 
100.6 
89.8 


$48,318,072 

16,073,303 

(d) 9,954,478 

(d) 2,161,841 

(d) 491, 004 

6, 646, 205 

17,065,037 

38, 260, 341 

54, 574, 319 

23, 139, 030 


100.0 

31.3 

-20.7 

-4.6 

-1.0 
11.4 
36.4 
79.3 

113.0 
47.8 


$28,494,459 
29, 553, 211 
22, 165, 214 
9,861,261 
9,336,885 
9.348,820 
9, 339, 861 
14,005,111 
26,419,972 
21, 760, 321 


100.0 
103.7 
77.- 8 
34.6 
32.8 
32.8 
32.8 
49.2 
92.7 
76 3 


1932 


1933.. 

1934 


1935" 


1936 


1937 


1938 







■ During the year 1929, the Management's Participating Plan and the Efficiency Contribution Fund 
were in effect. 



Table Q. — Union Oil Company of California and subsidiaries — Comparison of 
compensation paid officers and directors, net earnings applicable to common stock 
and dividends paid on common stock 



1929-1938 



Year 


Payments to Officers 
and Directors 


Net Earnings Applicable 
to Common Stock 


Dividends Paid on Com- 
mon Stock 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929=100 


Amount 


Index Nos. 
1929 = 100' 


1929 


$314,475 

301, 325 

267,203 
239,668 
208,065 
187,864 
177,944 
196, 400 
202,600 
296,758 


100.0 

95.8 

85.0 
76.2 
66.2 
59.7 
56.6 
62.5 
64.4 
94.4 


$15, 019, 636 

9, 604, 996 

3 3, 054, 913 
3,211,084 
1,964,279 

« 2, 902, 733 
5,038,286 
6, 133, 398 

12,061,332 
6,862,758 


100.0 

64.0 

20.7 
2L3 
13.3 
19.3 
33.3 
40.7 
80.0 
46.0 


/ '$1,044,279 

\ 7,986,339 

f « 4, 283, 396 

1 8, 666, 786 

8, 772, 140 

5,263,284 

4,386,070 

4,386,070 

4,386,070 

4,386,070 

6,465,338 

5, 599, 624 


} 100.0 

} 142. 3 
97.1 


1930 


1931 


1932 _-_. 


68.3 


1933 


48.6 


1934 


48.6 


1935 


48.6 


1936 

1937.. 


48.6 
7L6 


1938 


62.0 



' Index based on combined cash and stock dividend. 
'Stock dividend. 

3 Subject to unrealized inventory loss and write-down. 

* Includes a non-recurring profit realized on the sale of the Company's one-half interest in the Union 
Atlantic Company. 



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124491— 40^pt. 17-A- 



9988 



CONCENTRATION OF ECONOMIC POWER 

CoNSOLII)ATBD OiL CORPORATION 

Reply lo Hem 8 (o) of T. N. E. C. Quesiionnaire 



Answer: (a) During the period January 1, 1929 to December 31, 1938 the 
reporting company issued Common Capital Stock and Preferred Stock Without 
Par Value in the amounts and for the purposes indicated in the following tabula- 
tion: 





Amount credited to Common Capi- 
tal Stock or Preferred Stock With- 
out Par Value 




Number of 
Shares 


Per 
Share 


Amount 


Common Capital Stock: , „ ^ , . „, 

Issued to Employees, for cash, under stock Subscription Plans — 
Issued in connection with the acquisition of the properties and 


32, 404 
700,000 

8,111,432 
56, 757. 8 


$30.00 
30, 00 

'5.00 
100.00 


$972. 070. 00 
21,000,000.00 


Issued in connection with the acquisition of the assets and busi- 
ness t)f The Prairie Oil and Gas Company and The Prairie 


40,557,100.00 


Preferred Stock Without Par Value (designated as $5 Cumulative 
Dividend Sinking Fund Preferred Stock Without Par Value): 
Issued in exchange for Preferred Stock of the Par Value of $100, 
8% Cunulative. of the reporting company, on the basis of 1.1 shares 
of such $5 Preferred Stock for 1 share of such 8% Preferred Stock. . . 


5, 675. 780. 00 



1 The amount by which the value ascribed by the Board of Directors of the reporting company to the 
assets acquired upon issuance of these 8,111,432 shares exceeded the nominal value of $5 per share, was cred- 
ited to Capital Surplus, namely $96,061,328. 



The Pure Oil Company 
Reply to Item 8 of T. N. E. C. Questionnaire 

(a) 1. On January 13, 1936, the Board of Directors of the reporting company 
submitted a plan of exchange to its preferred shareholders for the purpose of dis- 
posing of the accumulated arrears of dividends on such preferred shares. Under 
this plan holders of 8% preferred shares were offered for each such share held the 
alternative of one and thirty-four ^hundredths shares of new 6% preferred shares 
and $1.50 in cash or one new 8% preferred share, twenty-four hundredths of one 
share of new 6% preferred shares, and $1.50 in cash; holders of 6% preferred 
shares were offered for each such share held one and eighteen hundredths shares 
of new 6% preferred shares and $1.12>^ in cash; and holders of 5%% preferred 
shares were offered for each such share held one and sixteen hundredths shares 
of new 6% preferred shares and $.87^ in cash. 

Under the plan, at various dates between January 13, 1936 and March 26, 
1936, 58,349 new 8% preferred shares and 85,532.96 new 6% preferred shares 
were issued to holders of 8% preferred shares against cancellation of 11,729 
8% preferred shares; and 180,042.04 new 6% preferred shares were issued to 
holders of 6% preferred Shares against cancellation of 152,578 6% preferred 
shares. 

As a result of the plan $5,767,143.75 aggregate amount of accumulated and 
unpaid dividends on the said 8% preferred shares and 6% preferred shares were 
extinguished. Included in this amount is $339,243.75 paid in cash to the holders 
of preferred shares making the exchange. 

2. During the period from January 1, 1936, to July 1, 1937, the reporting com- 
pany sold 943,620 common shares without nominal or par value (assigned value 
$10 per share) as the result of exercise of Warrants attached to the Fifteen Year 
4>i% Sinking Fund Notes. The Warrant attached to each $1,000 Note permit- 
ted the holder to purchase 30 common shares at $15 per share. 

The entire proceeds derived from the sale of said common shares amounted 
to $14,154,300 in cash and were deposited with the Trustee in accordance with 
the provision of the Indenture of the Fifteen Year 434% Sinking Fund Notes. 
All of such proceeds were used for the retirement of the Notes. 



CONCENTRATION bi?' ECONOMIC POWER 



9989- 



The excess of the amount received ($15 per share) over the assigned value ($10 
per share) of common shares sold through the exercise of Warrants attached to 
the Notes was credited in the aggregate amount of $4,718,100 to paid-in surplus. 

3. In September 1937 and October 1937 the reporting company sold 442,434 
5% cumulative convertible preferred shares having a par value of $100 per share. 
These shares may, at the option of the holders thereof, be converted into common 
shares at any time on or before October 1, 1947. The conversion price (subject 
to adjustment) is $22.22-2/9 to October 1, 1940, $25 thereafter to October 1, 1942 
and $30 thereafter to October 1, 1947 when the conversion privilege expires. 

The net proceeds from the sale of the above shares, after deducting the sum 
of $1,106,107.50 representing underwriters' discounts or commissions and the 
sum of $269,114.10 representing expenses of the Company in connection with 
such sale, amounted to $42,868,178.40 and have been used for the following 
purposes: 

(i) $8,428, 200'*for the redemption or purchase on a prior to January 1, 1938, 
of 76,620 8% cumulative preferred shares (par value $100) at $110 per share.. 

(ii) $3,000,000 to pav the balance of unsecured bank loans maturine from 
1938 to 1940 inclusive. 

(Hi) $25,000,000 to retire unsecured bank loans of the same principal 
amount incurred for the purpose of providing a portion of the funds required 
for the redemption of all of the Fifteen Year 4}i% Sinking Fund Notes on 
July 1, 1937. 

(iv) The remainder of the net proceeds, amounting to $6,439,978.40. tas 
been added to the general cash funds of the Company and.no part has been 
allocated to specific purpo.'^es. 

4. In September 1937 the rejjorting company sold 41 common shares without 
nominal or par value (assigned \alue $10 per share) at $22.22% per share. Thfse 
shares, together with 8,040 5% cumulative convertible preferred shares included 
with those covered in Paragraph 3 of this item, were sold to Common Shareholders 
of the Company pursuant to an .■ilternatiVe offer made to such shareholders prior 
to the sale to the Underwriters. 

The total proceeds frojn the .-ale of the above common shares amounted to 
$911.11 and were included in the !j.eneral cash funds of the Company. The excess 
of the realized price ($22.22/9 per share) over the assigned value ($10 per share) 
amounting in the aggregate to $501.11 was credited to paid-in surplus. 



Sacony-Vacuum Oil Company, Incorporated 
Reply to Item 8 (a) of f N. E. C. Questionnaire 



Year 


Shares issued 


Amounts 

credited to 

surplus 


Purpose of Issue 


1929... . 


15, 789 

469, 830 

13. 911, 433 

136, 951 

9,003 

3.942 

1.709 

306 

384 

.50 


$205, 257. 00 


Acquisition of assets. 


1930 . . 




1931 




<< <i <■ 


1932... 


•■ (1 << 


1933 . — 


II 11 II 


1934 - 


30. 4S.0. 00 
17.090.00 
3, 060. 00 
3. 840. 00 
500.00 





1935.. 


■1 11 II 


1936 


•1 11 II 


1937 


i< 11 II 


1938 


" " " 


i 


14, 549, 397 


$260 227. 00 





9990 



CONCENTRATION OF ECONOMIC POWER 

Standard Oil Company (Indiana) 
Reply to Item 8 (a) of T. N. E. C. Questionnaire 



Details 



Sales to Employees Stock Purchasing Plans— Years 1929 

and 1937...- .- 

•Issued in exchange for— 

Midwest Refining Company Stock— Years 1929- 

1930-1931 - 

Pan American Petroleum and Transport Company 

Stock— Years 1929-1930 .. 

Pan American Southern Corporation Stock— Years 

1937-1938- 

Pan American Eastern Petroleum Corporation 

Stock— Year 1929. - 

Mc-Man Oil and Gas Company Stock— Year 1930,. 
Stock Dividend— Year 1929 



Capital Stock 



Number of 
Shares 



89, 779. 5 

2,070 

2, 602, 642. 8444 

11, 534. 

234, 107. 1428 
200, 000 
4, 649, 284. 7668 



7, 789, 418. 2540 



Par Value 



$2, 244, 487. 50 

51,750.00 

65,066,071.11 

288, 350. 00 

5, 852, 678. 57 

5,000,000.00 

116,232,119.17 



$194, 735, 456. 35 



Amount 
Credited to 
Capital Sur- 
plus 



$2, 077, 291. 81 

15. 870. 00 

72, 375, 925. 79 

104, 688. 62 

7, 257, 321. 43 
6, 375, 000. 00 



8, 174, 357. 65 



Standard Oil Company (New Jersey) 
■Details of original issues of capital slock {par oalue $25 per share) question 8 



I ear 
Is'sucd 



1929 
1929 
1929 
1929 
1930 
1931 
1932 
1933 
1934 
19.35 
1936 

1936 
1937 
1938 



Purpose of Issue 



To Trustees>if stock acquisition plans — for cash 

For stock of Beacon Oil Company 

For stock of Pen-Del Investing Company 

For stock of Standard Oil Company of New Jersey 

To Trustees of stock acquisition plans — for cash 

To Trustees of stock acquisition plans — for cash 

To Trustees of stock acquisition plans— for cash 

To Trustees of stock acquisition plans — for cash 

To Trustees of stock acquisition plans— for cash 

(No issues).. 

In part payment for stock of Pan American Foreign Cor- 
poration 

Forstock of Colonial Beacon Oil Company... 

(No issues) 

For stock dividend: 

Full shares.. _ 348,352 

Scrip certificates exchanged for full shares. 18, 441 
Scrip certiflcates exchanged for full shares . 26, 504. 69 



Totals 2,133,846. 



Shares 
Issued 



123, 547 
199, 454- 

65, 748 
546,000 

99,600 

217, 000 

5,497 

20,500 

94, 616 



344, 744 
23,942 



\ 393, 



297.69 



Accounts Credited 



Capital 
Stock 



$3, 088, 675 

4, 986, 350 
1, 643, 700 

13, 650, 000 
2, 487, 500 

5, 425, 000 
137, 425 
512, 500 

2, 365, 400 



8, 618, 600 
598,550 



9, 832, 442 



$53, 346, 142 



Capital 
Surplus 



$3, 0.50, 752 

5,784,166 

1, 380, 756 

21, 135, 660 

4,128.982 

3,060,000 

49, 473 

184, 500 

1, 736, 007 



5,974,413 
414,915 



983, 245 



$47, 882, 869 



CONCENTRATION OF ECONOMIC TOWER 

SrANtJAKI) Oil, CoMI'ANV (.OlIlo) 

Reply to Question 8 {a) of TNEC Questionnaire 



9001 



STATEMENT OF ORIGINAL ISSUES OF CAPITAL STOCK JANUARY 1, 1029 TO 

DECEMBER 31, 1938 


Date of 
Issue 


Kind of Stock 


No. of 
Shares 
issued 


Total Par 
Value 


Credit to 
Surplus 


Purpose of Issue 


1930 


5% C u m u 1. 
Pfd. $100par. 

Com. .$25 

Com. $25 par.-. 


120,000 
188, 673 

7,592 


$12,000,000.00 
4, 716, 82,';. 00 

189, 800. 00 




To redeem 70,000 shares outstanding 
7% pfd. stk. $100 par, & to provide 
additional funds for corporate 
purposes. 

62,639 shares i.ssued to acquire pfd. 
stock of Ajax Corp. 

124,028 shares issued to acquire assets 
of Refiners Oil Co. 

2,006 shares issued in part payment 
for assets of Solar Refining Co. 

Issued from time to time to Trustees 
under Stk. Purchase Plan for exec- 
utives and key men for varying 
cash considerations as provided by 
said plan. 


1931- 


$3, 760, 219. 17 

' 7,445,400.84 

» 72, 6X7. 20 

155,071.21 


1930 to 1935, 

inc. 



' This item of $7,445,400.84 represented the difference between the par value of the shares issued for the 
assets of the Refiners Oil Co. and the agreed value of such assets, including good will upon acquisition, such 
assets were taken into the records of the company at substantially the value thereof appearing upon the 
books of the Refiners Oil Co., with minor adjustments, and an item of $4,934,356.84 was set up representing 
the good will acquired. This good will item was at the end of the year 1931 charged against Capital Surplus. 
Additional charges were subsequently made against the Capital Surplus arising out of the issuance of these 
shares by reason of the abandonment of various stations acquired from Refiners Oil Co., so that out of the 
$7,445,400.84 credited to Capital Surplus in 1931 in this transaction, only $2,069,252.16 still remained on the 
books of the Company at the end of 1933. 

' While the amount of $72,617.20 was originally credited to Capital Surplus in 1931, in connection with 
this transaction (being the difference between the par value of the Company's shares issued in connection 
therewith and the agreed value at which the same were issued), charges against Capital Surplus were sub- 
sequently made during the same year on account of obsolete portion of the plant and equipment so acquired 
The anjount of these charges was more than sufficient to eliminate this item of Capital Surplus. 



The Texas Corporation 

Reply to Item fS of T. N. E. C.. Questionnaire 

a. Details of any original issue of capital stock indicating the purpose 
of each issue (If any part of the proceeds was credited to surplus, state 
such amount). 

1. On October 16, 1928, the Board of Directors of The Texas Corporation 
resolved to offer to the stockholders of record at the close of business on Novem- 
ber 23, 1928, the right to subscribe, at $40.00 per share, for additional shares of 
The Texas Corporation in the proportion of one additional share for each six shares 
then owned, as shown by the books of the Corporation. Rights to subscribe 
expired January 15, 1929; terms of payment were $20.00 per share on or before 
January 15, 1929, and $20.00 per share on or before April 2, 1929; definitive cer- 
tificates to be issued and delivered after April 2, 1929, the stock to participate 
in dividends declared and payable after that date. 

Number of shares issued was 1,404,210 (par value $25.00 each). Amount 
credited to capital surplus account was $21,063,150.00. 

Proceeds of this issue were intended to be used for the expansion of the produc- 
ing, transporting, refining and distributing facilities of the Corporation's subsidi- 
aries, for reimbursing the treasury for expenditures made on some work then 
under way, and for general corporate purposes. 

2. On January 15, 1937, the Board of Directors of The Texas Corporation 
resolved to offer to stockholders of record on February 15, 193", the right to 
subscribe, at $40.00 per share, for additional stock of The Texas Corporation in 
the proportion of one additional share for each six shares then owed, as shown 
by the books of the Corporation. 



9992 



rONCENTRATION OF ECONOMIC TOWER 



The rights to subscribe expire Marcli 19, 1937; terms of payment were $20.00 
])er sl)aro at tlic time of subscription ami $20.00 por share on or bof<jrc May 14 
1937, Certilicatcs for the shares subscribed to be issued after payment of the 
subscription price in full, the sjiarcs to participate in dividends payable to stock- 
holders of record on dates after. the issuance of certificatcE covering such shares. 

Number of shares issued, 1,534,999 (pat value $25.00 each). Amount crevlited 
to capital surplus account, $23,043,735.00. 

The proceeds of this issue were in^crdcd to be applied to the payment of 
$22,500,000.00 owed by The Texas Company (a subsidiary) to banks; to finance 
expansion of plant facilities of subsidiaries, exploration for and aevelopment of 
producing properties, and additional investments in an amount estimated at approx- 
imately $21,500,000.00; and the remainder to reimburse the Treasury for funds 
previously applied to the retirement of funded debt and bank loans, expended 
for investments, etc., and to pay off certain miscellaneous purchase obligations. 



Union Oil Company of California 
Reply to Item 8 of T. N. E. C. Questionnaire 
8. (a) Details of original issues of capital stock, 1929 to 1938, inclusive: 



Year 




Number 
of Shares 


Charges or Credits to surplus 


1929 
1930 


Issuance under subscription 
rights offered to stockholders 
on 12/20/29. 
do 


377, 408 

2,585 
1,717 

3,335 
41,771 

164, 197 


Surplus credited in 1929 with difference between sale 
price of $35.00 per chare and par value of $25.00 per 
share on total she.res subscribed for. Amount of 
credit was $3,799,93). 


1929 
1930 


Issuance to employees under 
subscription plan offered in 
1925. 
do — - 


[No adjustment to su-plus in these years. 


1929 


Stock dividend of 1% 


No adjustment to surplus, other than debit for divi- 
dend. 

Surplus charged wi'.h $100,813 representing premium 
paid on fractional shares purchased and cancelled. 


1930 


Four stock dividends Of 1% 
each, less purchase of frac- 
tional shares. 



Exhibit No. 1314 
Part "A" — Appendix II 

[T. N. E. C. 4/19/30, Question 33, Exhibit E] 

Statement of shares of capital stock voted at stockholders meetings of the Atlantic 

Refining Company 

1929 

Annual Meeting, May 7, 1929: 'SAarw 

A. Shares voted by Stockholders in person 33,427 

B. Shares of Stock voted by proxy exercised by Company officers 

and directors 1, 383, 978 

C. Shares voted by proxy exercised by other than officers and 

directors None 

D. Total shares of stock voted by each officer and director both 

as personal holdings and by proxy, shown separately: 



J. W. Van Dyke.- 

W. M.Irish 

J. W. Liberton.... 
Robert H. Colley- 

E. J. Henry- 

E. R. Cox 




Proxy 



1,383.968 
10 



1930 

Annual Meeting, May 6. 1930: Shares 

A 37,963 

B 1,641,669 

C , None 

D. 



.1. W. Van Dyke. 

W. M. Irish 

R. D. I onard— 
.1. W. Liberton— 

O. E. Glines 

E. J. Henry 

Robert H. Colley 
E. R. Cox 



Personal 




Proxy 



1,641,636 



1931 

Annual Meeting, May 5, 1931: Shares 

A .- 1 38,974 

B . 1,712,886 

C None 

D. 





Personal 


Proxy 


J. W. Van Dyke 


28, 777 

1,903 

328 

153 

200 

1,074 

64 


9, 367 


W.M.Irish . 


1,089,3.59 


R.D.Leonard ... . . . ... 




Robert H. Colley... . 


14,100 


E.J.Henry 




E. R. Cox. 




J. W. Liberton 









9993 



9994 



CONCENTRATION OF ECONOMIC POWER 



Statement of shares of capital stock voted at stockholders meetings of the Atlantic 
Refining Company — Continued 

1932 

Annual Meeting, May 3, 1932: Shares 

A 51,651 

B 1,653,710 

C 15 

D. 





Personal 


Proxy 


J. W. Van Dyke ... 


42, 100 
2,557 
1,132 
2,500 
366 
211 
1,005 




W.M.Irish : 

R.D.Leonard . . ... 


1, 653, 570 


W. D. Anderson 




E. J. Henry- 




Robert H. CoUey 




E. R. Cox 


140 







1933 

Annual Meeting, May 2, 1933: Shares 

A 51.923 

B . . . 1,510,497 

C None 

D. 



Personal 



Proxy 



J. W. Van Dyke.. 

W.M.Irish 

W. D. Anderson.. 

E.J. Henry 

Robert H. Colley. 

J. D. Oill 

E. R. Cor 



44,100 
3,200 
2,500 



611 
260 
814 



1, 509, 591 
"" 666 



240 



1934 

Annual Meeting, May 1. 1934: Shares 

A 53,614 

B 1,467,066 

C 800 

D. 



J. W. Van Dyke.. 

W. M.Irish 

R. D. Leonard 

E.J. Henry 

Robert H. Colley. 

J. D. Gill __ . 

E. R. Cox 



Personal 



46,100 

3,200 

829 



1,611 
360 
754 



Proxy 



1, 440, 048 



500 
26,518 



rONCENTRATION OF ECONOMIC POWER 



9995 



SliUonciU of liliarcn of cajtilal utorlc voUd at stockholders mcctintj^ of lliv Allanlic 
lleflniuij Colli, party — Continued 

1935 

Annual Meeting May 7, 1935: Shares 

A 55,872 

B..__ 1,407,886 

C None 

D. 





Personal 


Proxy 


J. W. Van Dyke - .. 


46, 100 
3,200 
2,435 




W. M.Irish. 


1, 406, 8C7 


W. D.Anderson ... '- . . .. 




R.J.Henry 


276 


Robert H. Colley 


1,611 

33 

373 

360 




W. M. O'Connor v.. -- -- 




W. C. Yeager . . . . .- .- 




J.D.Qill . - 




R. C.Tuttle - 


503 


E. R. Cox . . . . .-- - 


760 


240 







1936 

March 24, 1936, Special Meeting: Shares 

A 50,726 

B 1,418,556 

C 433 

D. 



J. W. Van Dyke.. 

W. M. Irish 

Robert H. Colley. 
W. M. O'Connor. 

J. D. Gill 

E. R. Cox 

W. C. Yeager 




March 30, 1936, Special Meeting: Shares 

A - 50,391 

B 1,430, 199 

C 433 

D. 





Personal 


Proxy 


J. W. Van Dyke 


46,100 
500 
1,611 
33 
373 
360 
760 




W.M.Irish 


1, 429, 959 


Robert H. Colley 




W. M. O'Connor 




W. C. Yeager. 




J. D. Gill 




E. R. Cox 


240 







9996 



CONCENTRATION OF ECONOMIC POWER 



Statement of shares of capital stock voted at stockholders meetings of the Atlantic 
Refining Company — Continued 

May 5, 1936, Annual Meeting: Shares 

A 50, 192 

B 1,449, 197 

C None 

D. 





Personal 


Proxy 


J. W. Van Dyke 


46,100 
500 




W.M.Irish _ 


1, 448, 601 


E.J.Henry 


266 


Robert H. CoUey . . 


1,346 
383 
360 
760 




W. C. Yeager 




J. D. QUI _ -. 




E. R. Cox 


240 







1937 

May 4, 1937, Annual Meeting: Sharea 

A 50,566 

B 1,436, 188 

C 568 

D. 



Personal 



Proxy 



J. W. Van Dyke.. 

E. J. Henry 

Robert H. Colley. 

J. D. QUI 

R. C. Tuttle 

E. R. Cox 

E. H. Blum 



46,100 



360 

10 

960 

800 



1,611 

1, 433, 629 

205 

503 

240 



1938 

May 3, 1938, Annual Meeting: Shares 

A 60,980 

B 1,483,271 

C 1,033 

D. 





Personal 


Proxy 


J. W. Van Dyke 


53,700 
1.611 
266 
373 
360 
10 
800 
960 




Robert H. Colley... 


1, 482, 298 


E. J. Henry ... 




W. C. Yeager ..- . . . 




J. D. Gill.. _ 




R. C, Tuttle 


733 


E TT, Rlnm 




E. R. Cox _ 


240 



September 12, 1938, Special Meeting: 
A 



Common 

61,032 

B 1,438,358 



C. 
D. 



583 



Preferred 
180 
91,490 





Personal 


Proxy 




Common 


Preferred 


Common 


Preferred 


J. W. Van Dyke 


54.200 
1,611 
266 
373 
360 
10 
800 
960 








Robert H. Colley 


100 


1,437,411 


91, 477 


E. J. Henry 




\V. C. Yeager.. 


20 






J. D. Gill 






R. C. Tuttle 




707 




E. H. Blum 


2 
43 




E. R. Cox 


240 


U 



CONCENTRATION OF ECONOMIC POWER 



O 



997 



Statement of shares of capital stock voted at stockholders meetings of the Atlantic 
Refining Company — Continued 

September 16, 1938; Adjourned Special Meeting: Common Preferred 

A 60,584 165 

B 1,445,791 91,584 

C 433 

D. 





Personal 


Proxy 




Common 


Preferred 


Common 


Preferred 


J W. Van Dyke 


54,200 
1,611 
266 
373 
360 
10 
800 
960 








Robert H. CoUey 


100 


1,444,844 


91, 571 


E, J. Hemy .__ 




W. C. Yf;ager 


20 






J.D.Oiil -- 






R. C. ''.uttle 




707 




E. H. Blum -.- - 


2 
43 




E. R. Cox 


240 


13 







May 11, 1939 
F. 



CiTiKS Service Company (Del.) 



(.33) With regard to all meetings of stockholders of the reporting company 
held during each of the years 1929 to 1938, both inclusive, submit a statement 
showing: 

a. Shares of capital stock voted by stockholders in person. 

b. Shares of capital stock voted by proxy exercised by company oflBcers 
and directors. 

c. Shares voted by proxy exercised by other than company officers and 
directors. 

d. Total shares of stock voted by each officer and director at each meeting, 
both as to personal holdings and by proxy, shown separately. 



Date of meeting 


Total votes 


(a) 

Votes in 
person 


(b) 

Votes by 
proxies by 
company 
directors and 
oflBcers ' 


(C) 

Votes by 

proxies 

by others 


(d^ 
Votes voted by directors and oflBcers 




In per- 
son 


By proxy • 


Total 


Apr. 30, 1929.... 
May 12, 1930.... 


1.713,905 
2, 619, 598. 45 
2,811,977.65 
2, 626. 054. 90 
2, 641, 659. 45 
2, 578, 355. 3 
2, 691, 406. 8 
1, 603, 742. 05 
1,631,816.15 
1, 651, 358. 65 
1,742.922.10 


119.8 

115.85 

454.90 

696. 45 

4, 470. 50 

5, 581. 25 

7,404.10 

7,929.45 

2,852.75 

8,094.75 

8,401.95 


1, 713, 397. 2 
2, 619, 446. 60 
2,811,522.75 
2,625,358.45 
2, 637, 188. 95 
2, 572, 774. 05 
2,683,880.7 
1, 595, 812. 6 
1, 628, 566. 14 
1, 643, 243. 9 
1, 734, 475. 15 


388 


39.4 
151.85 
325. 65 
337.6 
4, 260. 20 
4, 282. 75 
5. 175. 75 
5,727 
5,088.30 
6, 354. 25 
6, 135. 25 


1, 713, 397. 2 

2,619,446.60 

2,811,622.75 

2,625,358.45 

2,637,188.95 

2,572,774.05 

2,683,880.7 

1,595,812.6 

1,628,566.14 

1, 643, 243. 9 

1, 734, 475. 15 


1,713,436.6 
2, 619, 598 85 


Apr. 21, 1931 




2, 811, 848. 40 


Apr. 26, 1932 




2, 625, 696. 05 


Apr. 25, 1933 

Apr. 24. 1934 




2,641,449.15 
2, 577, 056. 80 


Apr. 30, 1935 

Apr. 28, 1936.... 
Mar. 16, 1937.... 
Apr. 27. 1937.... 
Apr. 26, 1938.... 


100 
None 
397. 26 

20 

45 


2,689.056.45 
1, 601, 539. 6 
1, 633, 654. 44 
1, 649, 598. 15 
1,740,610.40 



1 Columns (b) and (d) : All of the stock voted was voted by an oflBcer or a director representing the Proxy 
Committee which consisted of persons who were oflBcers and/or directors and persons who were neither. 
Included In the shares so voted were shares owned by certain other oflBcers and/or directors. 



9998 



•CONCENTRATION OF ECONOMIC POWER 



Continental Oil Company 

Item 33: With regard to all meetings of stockholders of the reporting company 
held during each of the years 1929 to 1938, both inclusive, submit a statement 
showing: 

(a) Shares of capital stock voted by stockholders in person : 

1930 653 1935 2,461 

1931 303 1936 303 

1932 101 1937 303 

1933 543 1938 2,703 

1934 1,400 

(b) Shares of capital siock voted by proxy exercised by company officers 
and directors: 



1930 1,909,672 

1931 2,463,169 

1932 2,464,557 

1933 2,681, 124 

1934 2,199,739 



1935 2,528, 684 

1936 2,713,944.478 

1937 2,421,504 

1938.- 2,716,733 



(c) Shares voted by proxy exercised by other than company officers and 
directors: 



1930 None 

1931 None 

1932 None 

1933., None 

1934 None 



1935 . None 

1936 6,750 

1937 17,000 

1938 6,385 



(d) Total shares of stock voted by each officer and director at each meet- 
ing, both as to personal holdings and by proxy, shown separately: 



Year 



Personal 



Proxy 



W. W. Bruce 

W. W. Bruce 

W. W. Bruce 

W. W. Bruce 

W. W. Bruce 

W. W. Bruce 

Dan Moran 

James J. Cosgrove 
James J. Cosgrove 
W. H. Terguson.. 
W. H. Ferguson.. 



1930 
1931 
1932 
1933 
1935 
1936 
1934 
1934 
1935 
1937 
1938 



200 
None 
None 
None 
None 
None 
None 
1,400 
2,158 
None 
None 



1, 909, 672 
2, 463, 169 
2, 464, 557 
2, 681, 124 
2, 528, 684 
2, 713, 944. 47 
2, 199, 739 

None 

None 
2, 421, 504 
2, 716. 733 



Consolidated Oil Corporation 

Question 33. With regard to all meetings of stockholders of the reporting com- 
pany held during each of the years 1929 to 1938, both inclusive, submit a state- 
ment showing: 

a. Shares of capital stock voted by stockholders in person 

b. Shares of capital stock voted by proxy exercised by company officers 
and directors 

c. Shares voted by proxy exercised by other than company officers and 
directors 

d. Total shares of stock voted by each officer and director at each meeting, 
both as to personal holdings and by proxy, shown separately — 

Answer: The requested information is listed hereinafter with respect to 
each meeting of stockholders of the reporting company held during each of 
the years 1929 to 1938, both inclusive. The headings A, B, C and D refer 
to the similarly designated subdivisions of the question, and the letters 
D and O appearing in the column headed "Title" indicate Director and Officer 
respectively. 



CONCENTRATION OF ECONOMIC OWER 9999 

Animal inccLinir, ^ear 1929: •^'"'f'''' 

A - 409 

B . 4,361,447 

C - 

D 



Name 



J. W. Games - - 

Sheldon Clark 

J. F. Farrell.. , 

H. F. Sinclair -- 

C. E. Crawley 

S. L. Fuller _ 

E.H.Clark.... 

D. L. Hoober. 

E. W. Isom 

F. H. Bartlett 

A. W.Cutten 

H. H. Rogers --.- 

E. W. Sinclair 

Geo. H. Taber, Jr.... 

A. E. Watts .- 

W. L. Connelly 

P. W. Thirtle 

H. F. Sinclair, J. F. Farrell and Sheldon Clark as joint 

proxies 

J. F. Farrell and Sheldon Clark as joint proxies 

Arthur Cutten, J. F. Farrell and Sheldon Clark as joint 

proxies '- 

F. Bartlett, J. F. Farrell and Sheldon Clark as joint 
proxies. 



Title 



D& O. 
D & O. 
D & O. 
D&O. 
D & O. 

D 

D 

D&O. 

D 

D 

D 

D 

D & O. 

D_ 

D&O. 

O 

D&O. 



Number of Shares 
Voted 



Persopal 
Holdings 



414 
300 
314 

3.237 
100 
67 

2,300 

500 

2 

5,000 

10, 000 

500 

800 

435 

1,050 

1,500 
200 



By Proxy 



825 
2,391 



1 4, 353, 443 
4, 405 



182 
200 



• Includes respective personal holdings. 

19.30 

Annual meeting, year 1930: Sharet 

A 476 

B 3,866,742 

C 2 

D 



Name 


Title 


Number of Shares 
Voted 


Personal 
Holdings 


By Proxy 


P. D. C. Ball - 


D 


10,024 

5,000 

414 

300 

10, 000 

100 

1,014 

67 

500 

332 

750 

3,337 

435 

200 

1,344 

1,104 

101 




F. H. Bartlett 


D. _. _ 




J. W. Carnes 


D& 

D& 

D 




Sheldon Clark 




A. W. Cutten .... 




C.E.Crawley 


D& 

D& O 

D 




J. F. Farrell 




&. L. Fuller 




D. L. Hoober , 


D& 

D .- . . 




E. W. Isom -. 




H.H.Rogers.. i 


D 

D& 

D 

D & O 

D & 



0. - .. 




H. F. Sinclair , . ... 




Geo. H. Taber, Jr.- 




P. W. Thirtle . . ... 




A. E. Watts . . . 




W. L. Connelly... 


68 


A. Steinmetz . 




H. F. Sinclair, J. F. Farrell and Sheldon Clark as joint 
proxies. 


1 3, 8G6, f>7 » 









' Includes respective personal holdings. 



10000 



CONCENTRATION OF ECONOMIC POWER 



Special meeting, year 1930: shares 

A 2,319 

B 4,736, 161 

C 301 

D 



Name 


Title 


Number of Shares 
Voted 


Personal 
Holdings 


By Proxy 


P. D. C. Ball - 


D ... 


10,024 

5,000 

414 

300 

10,000 

100 

1,714 

67 

SCO 

332 

250 

3,337 

435 

200 

1,344 

700 

1,104 

141 

10 




F. H. Bartlett ..- 


D 




J. W. Carnes _ 


D&O 

D& - 

D.... 




Sheldon Clark ._ 




A.W. Cutten- - 




C. E. Crawley. ..- . - . ........... 


D&O 

D&O 

D 




J. F. Farrell 




S. L. Fuller 




D. L. Hoober 


D&O 

D 




E.W. Isom ...1. 




H.H.Rogers . . 


D . 




H.F.Sinclair ... . . 


D&O.^.... 
D 




Geo. H. Taber, Jr . 




P. W. Thirtlfi 


D&O _ 

D&0-1-... 
D ... . 




A. E. Watts . . - 




Alvin Untermyer . . 




W. L. Connelly 




O 




A. Steinmetz... 




J. Von Bevem 


O 




E. W. Sinclair 


D& 


35 


Q.T.Stanford 







200 


H. F. Sinclair, J. F. Farrell and Sheldon Clark as joint 






1 4, 735, 826 


proxies. 









' Includes respective personal holdings. 



1931 

Annual meeting, year 1931: 

A.- . (*) 

B (*) 

C (*) 

D 





Title 


Number of Shares Voted 


Name 


Personal 
Holdings 


By Proxy 


P. D.C.Bali .. 1 


D : 


10,024 

6,000 

414 

100 

100 

10,000 

931 

34 

332 

250 

3,362 

435 

100 

904 

700 

1,104 

112 

10 

40 


- 


F. H. Bartlett.... 


D 




J. W. Carnes 


D&O 

D&O 

D&O 

D 




Sheldon Clark 




C. E. Crawley 




A. W. Cutten . . 




J. F. Farrell... .- 


D&O. 

D 




S. L. Fuller 




E. W. Isom 


D 




H. H. Rogers 


D 




H. F. Sinclair . ... 


D&O 

D 




Geo. H. Taber, Jr 




P. W. Thirtle 


D&O 

D&O 

D — 




.\. E. Watts 




Alvin Untermyer . . 




W.L.Connelly.. 







A. Steinmetz 


0.... 




J. Von Bevem . 







M. R. Gross : 







B. P- Sinclair, J. F. Farrell and Sheldon Clark as joint 




1 > 4.400,000 


proxies. 









'These statistics requested not available. 
> Includes respective personal holdings. 
°> Approximate. 



CONCENTRATION OF ECONOMIC POWER 



10001 



1932 

Special meeting, year 1932: 

A . 5,673 

B 4,746,695 

C 1,827 

D 



Name 



P. D. C. Ball - -- - 

J. W. Carnes- -. - 

Sheldon Clark -_ 

O. E. Crawley — 

A. W. Cutten 

J. F. Farrell .-. .- 

S. L. FuUer.-.- 

E. W. Isom.... 

D. T. Pierce - 

H. F. Sinclair -. 

Geo. H. Taber, Jr.. -. ..- 

P. W. Thirtle---- 

Alvin Uotermyer 

A. E. Watts 

W. L. Connelly... 

M. R. Qross 

A. Steinmetz 

H. F. Sinclair, J. F. Farrell and Sheldon Clark as joint 
proxies. 



Title 



D 

D& O. 
D&O. 
D&O. 

D 

D&O. 

D 

D 

D 

D*0. 

D 

D&O. 

D 

D&O. 

O 

O 

O 



Number of Shares 
Voted 



Personal 
Holdings 



12,024 
414 
300 
100 

2,000 

300 

57 

732 

100 

3,362 

2,435 
200 
700 
994 

1,304 
104 
160 



By Proxy 



4, 746, 695 



■ Includes respective personal holdings. 

Annual meeting, year 193^: 

A._ 

B 

C 

D 



(*) 
(*) 
(*) 



Name 


Title 


Number of Shares 
Voted 


Personal 
Holdings 


By Proxy 


P. d: C. Ball 


D 


12, 524 

2,164 

1,014 

100 

100 

2,331 

10 

332 

100 

3,362 

2,436 

14 

700 

994 

100 

3,689 

11,113 

12,949 

10 

5,422 

1,000 

5,000 

10 

104 

160 




F. H. Bartlett 


D 




J. W. Carnes . . 


D&O 

D&O 

DAO 

D&O 

D . 




Sheldon Clark 




C. E. Crawley ._.. -. 

J. F. Farrell 


— 


S. L. Fuller .... 




E. W. Isom . 


D - . 




D.T.Pierce 


D .. 




H. F. Sinclair -.... 


D&O . 

D.. 




Geo. H. Taber, Jr , . 




E. R. Tinker .- 


D 




Alvin Untermyer . 


D 




A. E. Watts 


D&O 

D 




Elisha Walker 




W. S. Fitzpatrick 


D&O 

D 

D 




C. H. Eountz 




Nelson K. Moody _ _ 




TT. G. Frfinm(»n 


D 




John H. Markham, Jr 


D 




G.T.Stanford . 


D&O 

D 




Dana H. Kelsey - 




H. 8. Marston 


D 




M. R. Gross _ 







A. Steinmetz 







n. F. Sinclair, Sheldon^Clark and J. F. Farrell as Joint 
proxies. 




"»9, 660,000 







•These statistics requested not available. 
' Includes respective i)ersonal holdings. 
' Approximate. 



10002 CONCENTRATION OF ECONOMIC POWER 

1933 

Annual meeting, year 1933: 

A 4,587 

B 9,335,340 

C None 

D 



Name 


Title 


Number of Shares 
Voted 


Personal 
Holdings 


By 
Proxy 


P. D. C. Ball 


D 


5,025 

1.000 

1,014 

312 

100 

3,689 

2,031 

10 

10 

32 

11,113 

5,000 

10 

12,949 

100 

3,362 

1,000 

, 935 

14 

13,200 

100 

1,294 

226 

277 




R. E. Cutten 


D 

D&O 

D&O - 

D&O 

D&O 

D&O 

D.. 




J. W. Games i-. 




Sheldon Clark .--. .. 




C.E.Crawley 




W. S. Fitzpatrick .. 




J. F. Farrell •-. • 




H. Q. Freeman _ 




8. L. Fuller 


D J 




-E. W. Isom . . 


D . ... 




C. H. Kountz - 


D ' 




D.^. Kelsey 


D 

D 

D 




H. 8. Marston _ 




N. K. Moody 




D. T. Pierce .. ... .... 


D .. .. 




H. F. Sinclair 


D&O 

D&O 

D 




O.T.Stanford 




Geo. H. Taber, Jr 




E. R. Tinker—. 


D 




Alvin Untermyer . . .. . 


D .. 




Elisha Walker 


D .. 




A. E. Watts 


D&O 







W. F. Dau 




A . Rf.filnTnfif.7. 




H. F. Sinclair, J. F. Farrell and Sheldon Clark as joint 
proxies 


• 9, 335, 340 



1 Includes respective personal holdings. 

1934 

Annual meeting, year 1934: 

A (*) 

B (*) 

C (*) 

D 



Name 


Title 


Number of Shares 
Voted 


Personal 
Holdings 


By 
Proxy 


J. W. Carnes 


D&O 

D&O 

D&O 

D 


1,014 

312 

100 

1,000 

2,000 

3,600 

10 

10 

32 

5,000 

11, 113 

10 

6,104 

100 

3,362 

1,017 

1,435 

14 

13,200 

700 

263 

600 

462 




Sheldon Clark 




C.E.Crawley .. . 




R. E. Catten 




J. F. Farrell 


D&O 

D&O 

D 




W. S. Fitzpatrick 




H, CI. Frfip.rnan ... 




S. L. Fuller . ' 


D 




E. W. Isom 


D 




D. H. Kelsey 


D 




C. H. Kountz 


D 




H. 8. Marston . .. .. 


D 




N.K. Moody 


D... 




D. T. Pierce . .. 


D 




H. F. Sinclair .. 


D&O 

D&O 

D -- 




O. T. Stanford 




Oeo. H. Taber, Jr 




E.R. Tinker 


D 




Alvin Untermyer ... 


D 




A. E. Watts 


D&O 








W. F. Dau 




E.L. Wagon 




A. Steinmetz. 




H. F. Sinclair, J. F. Farrell and Sheldon Clark as Joint 
proxies 


>* 10,640,000 











• These statistics requested not available. 
< Includes respective personal holdings. 
' .A-PpVoximate, 



CONCENTRATION OF ECONOMIC POWER 10003 

1935 

Annual meeting, year 1935: 

A (*) 

B (*) 

C (*) 

D 





Title 


Number of shares voted 


Name 


Personal 
holdings 


By proxy 


J. W. Carnes 


D&O 

D&O 

D&O 

D&O 

D &0 

D 


1,014 

312 

100 

2,000 

3,600 

10 

32 

5,000 

11, 113 

10 

100 

3,362 

780 

1,435 

1,600 

14 

12,700 

700 

63 

600 

2 




Sheldon Clark .- 




C.E.Crawley • 




J. F. FarreU 




W. S. Fitzpatrick 




S. L. Fuller 




E.W.Isom - : 


D. — 




D. H. Kelsey .. . - - - - 


D 




C. H. Kountz 


D 




H. S. Marston 


D 




D. T. Pierce 


D 




H. F. Sinclair . . .. 


D&O 

D.. - 




L. V. Stanford . . .. 




Qeo. H. Taber, Jr.. 


D 




P. W. Thirtle 


D& O 

D . . -. 




K. R. Tinker 




Alvin Untennyer 


D 




A. E. Watts - . . 


D&O 






W. F. Dau . . 




E. L. Wagon 


o .:.. 




J. Von Bevem ^ 







H. F. Sinclair, J. F. Farrell, and Sheldon Clark, as joint 




n 9,000, 000 


proxies. 









Special meeting, year 1935: 

A (*) 

B . (*) 

C - (*) 

D 





Title 


Number of shares voted 


Name 


Personal 
holdings 


By proxy 


J. W. Carnes . 


D&O 

D&O 

D&O 

D&O 

D&O - 

D 

D 


1,014 

312 

100 

2,000 

3,600 

10 

32 

5,000 

11,113 

10 

100 

3,362 

780 

1,435 

1,600 

14 

12,700 

700 

63 

600 

2 




Sheldon Clark 




C.E.Crawley . .. 




J. F. Farrell. _ 




W. S. Fitzpatrick 




S.L. Fuller 




E.W.Isom 




D. H. Kelsey 


D 




C. H. Kountz . 


D 




H. S. Marston 


D 




D.T.Pierce 


D 




H. F.Sinclair.. 


D&O 

D 




L. V. Stanford 




Qeo. H. Taber, Jr . . . 


D . - 




P. W. Thirtle.. 


D&O 

D 




E. R. Tinker. 




Alvin Untermyer 


D . 




A. E. Watts .— . . 


D&O 






W. F. Dau - . . 




E. L. Wagon 







J. Von Severn 







H. F. Sinclair, J. F. Farrell, and Sheldon Clark as joint 




» « 9,900, 000 


proxies. 









•These statistics requested not available. 
' Includes respective personal holdings. 
» Approximate. 



>- i't. 17-A- 



10004 



C0NCENTRATIOI«f OF ECONOMIC POWER 



1936 

Annual meeting, year 1936: 

A.-. ---_. 4,622 

B - 11, 168, 167 

C 10, 154 

D 





Title 


Number of Shares Voted 


Name 


Personal 
Holdings 


By Proxy 


Sheldon Clark 


D&O 

D&O 

D&O 

D 

D 


312 

2,000 

4,000 

10 

32 

100 

3,362 

14 

12,700 

1,500 

263 

600 

2 




J. F. FarreU ^. . 




W. S. Fitzpatrick.. 




S.L. Fuller 




E. W. Isom '.... 




D. T. Pierce 


D 




H. F. Sinclair 


D&O 

D 




E. R. Tinker 




Alvin Untermyer 


D 






P. W. Thirtle 




W. F. Dau .- :.... 







E. L. Wagon 


O 




J. Von Severn 







H. F. Sinclair, J. F. Farrell and Sheldon Clark as joint 
proxies 




1 11,168,167 











1937 

Annual meeting, year 19il7: 

A 10,780 

B 10, 158,543 

C . 345,694 

D 





Title 


Number of Shares Voted 


Name 


Personal 
Holdings 


By Proxy 


Sheld«n Clark.. .. 


D&O 

D&O 

D&O 

D. .. 


312 

2,000 

4,000 

10 

32 

100 

3,362 

12,720 

1,500 

263 

600 

1 




J. F. Farrell 




W. 8. Fitipatrick 




S. L. Fuller . 




E. W. Isom.. 


D. ... 




D. T. Pierce ... . . 


D 




H.F.Sinclair 


D&O 

D 






Alvin Untermyer 




P. W. Thirtle.... 




W. F. Dau 







E. L. Wagon 


O 




J. Von Severn 







O. M. Gerstung . . .... 




25 


H. F. Sinclair, J. F. Fawcll and Sheldon Clark as Joint 
proxies 






1 10, 158, 518 











1 Includes respective personal iboldings. 



CONCENTRATION OF ECONOMIC POWER 10005 

1938 

Annual meeting, year 1938: 

A - 20, 173 

B 10,395,319 

C , 355,247 

D 





Title 


Number of Shares Voted 


Name 


Personal 
Holdings 


By Proxy 


Sheldon Clark _ 


D&O 

D&O - 

D&O 

D _.. 

D&O 

D. 


612 

2,000 

4,000 

10 

1,500 

100 

8,962 

650 

12,720 

1,500 

300 

600 

10 




J. F. Farrell 




W. S. Fitzpatriek 




8. L. Fuller 




H. R. Gallagher 




D.T.Pierce 




H. F. Sinclair 


D&O 

D 




H. F. Sinclair, Jr 




Al vin U ntermyer ..- 


D 




P. W. Thirtle 


.. . 




W. F. Dau 







E. L. Wagon.. 







J. Von Bevem l. 


0...L 




H. r. Sinclair, Sheldon Clark and J. F, Farrell as joint 
proxies 


> 10, 395, 319 











i Includes respective personal holdings. 



Gulf Oil Corporation 

Answer to Questions 33-a; 33-b; 33-c; 33-d. 

We tabulate below for each year inquired about the information called 
for by these questions. 

In Column "A" — The Shares of Capital Stock voted by Stockholders in 
person. 

In Column "B" — The Shares of Capital Stock voted by proxy exercised 
by Company Officers and Directors. 

In Column "C" — ^The Shares voted by Proxy exercised by other than Com- 
pany Officers and Directors. 

In Column "D" — Total Shares of Stock voted by each Officer and Director 
at each meeting both as to personal holdings and by proxy, shown separatcjly. 



Column 
A 

No. of 

shares 


Column 
B 

No. of 
shares 


Column 
C 

No. of 
shares 


Column D 


Personal 


Proxy 


Name 


No. of 
shares 


Name 


No. of 
shares 


5,308 
41,503 


4, 171, 889 
3, 982, 902 

4, 132, 194 
3,938,216 


None 
None 

None 
5,720 


TEAR 1929 

H. L. Stone 


5,086 

3,846 
10,330 
13,994 
3,110 
5,086 


Geo. S. Davison 

W.J.Guthrie 

W.J.Guthrie 

W.J.Guthrie- 


4, 171, 889 


YEAR 1930 

Charle"* B. Buerger 






W.J. Guthrie 


3, 982, 902 




F. A. Leovy 






O. R. Nutty 






H.L.Stone -. 




None 


YEAR 1931 

None 


4, 132, 104 


55, 232 


YEAR 1932 

Charles B. Buerger 


3,845 
100 
2,553 
10,330 
14,210 
6,327 
3,010 
5,086 




J. F. JDrake 






H. A. Gidney . 






W.J. Guthrie 


3, 938, 216 




F. A. Leovy 






J. E. Nelson 






G. R. Nutty 






H.L.Stone ...- 





10006 



CONCENTRATION OF ECONOMIC TOWER 



Column ' 
A 


Column 
B 

No. of 
shares 


Coluiiiu 
C 

No. of 
shares 




Coluniu 1) 




Personal 


Proxy 


shares 


Name 


No. of 
shares 


Name 


No. of 
shares 


51 177 


4,015,182 
3, 995, 349 
3, 908, 494 
4, 064, 264 

3, 906, 425 
7, 810, 354 

7, 875, 503 


None 
None 
1,425 
None 

3,135 
40 

100 


YEAR 1933 

Charles B . Buerger 


3,718 
100 

2,220 
10, 542 
14,204 

5,127 

5,507 

3,718 
100 
2,220 
9,742 
13, 385 
5, 527 
5,507 

3,718 
100 
2,220 
9,542 
11,982 
5, 527 
5,507 

3,531 
3,718 
100 
2.220 
9,542 
6,092 
11,980 
5,527 
4.507 

3, 718 
100 
2,053 
9, 542 
6.092 
10, 380 
5,527 
4,435 

2, 862 
8,447 
2,261 
4,106 
19, 084 
5.001 
17,818 
10, 654 
10, 671 

2,811 
7,947 
2,261 
4,906 
5,800 
16, 769 
11,154 
857 
10, 671 


W.J. Guthrie 

W.J. Guthrie- 

W.J. Guthrie 

W.J. Guthrie 

J. F. Drake 






J. F. Drake 

H. A. Qidney .-. 






W. J. Guthrie 


4, 015, 182 




F. A. Leovy. 






J. E. Nelson .. 






H. L. Stone 




45, 405 


YEAR 1934 

Charles B. Buerger 

J. F. Drake - 






H. A. Gidney 






W. J. Guthrie 


3, 995, 349 




F. .\. Leovy 






J. E. Nelson... - 

n. L. Stone 




49, 704 


YEAR 1935 

Charles B. Buerger 

J. F. Drake 

H. A. Qidney 






W.J.Guthrie --. 


3, 908, 494 




F. A. Leovy . . 






J. E. Nelson 






H. L. Stone - 




53 274 


YEAR 103(1, ANNUAL MEETIXf; 

E. C.Bothwell..- 






Charles B. Buerger 






J. F. Drake . .- 






H. A. Gidney 






W. J Guthrie 


4, 064, 264 




W. V. Hartmann. 












J.E.Nelson 






H. L. Stone 




48, 572 


YEAR 1936, SPECIAL MEETING 

Charles B. Buerger 




J. F. Drake 


100 




H. A. Gidney 


W.J.Guthrie 

F. A. Leovy 

H. L. Stone 

W.J. Guthrie 

J. F. Drake. - 






W.J.Guthrie 


3,901,930 




W. V. Hartmann 






F. A. Leovy . . 


488 


87,064 


J. E.Nelson 

H. L. Stone..-- 

YEAR 1937 

E C. Bothwell 


3,907 


Charles B. Buerger 

J. F. Drake. 






H. \. Gidney 






W.J. Guthrie 


7, 810, 354 




W. V. Hartmann.- - 






F. ; .Leovy - -.. 






J. F. Nelson . . 






H.L.Stone 




69,621 


TEAR 1938 

E. C.Bothwell 

Charles B. Buerger 






J. F. Drake - . 


694 




H. A. Gidney 


F. A. Leovy. -. 

David Proctor 

H. L. Stone 






W. V. Hartmann 








i . A . Leovy . . . 


976 




J. P. Nolson 








Dav'irf >'^vvftor. 


7, 873, 768 




H. L. Stotie -. 


65 









CONCENTRATION OF ECONOMIC POWER 



10007 



The Ohio Oil Company 

1929 

Ans. Annual Stockholders' Meeting, May 23, 1929: Shares 

a 29,188 

b 1,481,678 

c__ . _ . ^ None 

d 



Personal 
Holdings 



Proxy 



O. D. Donnell, President <fe Director 

J. K. Kerr, Vice President & Director 

K. J. Berry, Vice President & Director 

W. W. Fleming, Vice President & Director 
C. L. Fleming, Vice President & Director.. 

E. B. Redpath, Secretary 

F. A. Billstone, Treasurer - 



Shares 

10, 436 

1,380 

2,300 

450 

400 

60 

104 



Shares 
1, 481, 678 



Special Stockholders' Meeting, December 30, 1929: Shares 

a 20,837 

b^. 1,666,937 

c~__ _ _ __ _ None 

d 



Personal 
Holding? 



O. D. Donnell, President & Director 

J. K. Kerr, Vice President & Director 

R. J. Berry, Vice President & Director... 
C. L. Fleming, Vice President & Director 

E. B. Redpath, Secretary 

F. A. Billstone, Treasurer 




Proxy 



Shares 
1,666,937 



1930 

Annual Stockholders' Meeting, May 29, 1930: Shares 

a ---- 23,352 

b 1,552,742 

c None 

d 



Personal 
Holdings 



O. D. Donnell, President & Director 

J. K. Kerr, Vice President & Director 

R. J. Berry, Vice President & Director 

W. W. Fleming, Vice President & Director. 
John McFadyen, Vice President & Director 
C. L. Fleming, Vice President & Director.. 

E. B. Redpath, Secretary 

F. A. Billstone, Treasurer 




Proxy 



Shares 
1, 552, 742 



10008 CONCENTRATION OF ECONOMIC POWER 

Special Stockholders' Meeting, August 14, 1930: Shares 

a 31, 355 

b - 1,841,522 

c None 

d 



Personal 
Holdings 



Proxy 



O. D. Donnell, President & Director 

R. J. Berry, Vice President & Director 

C. L. Fleming, Vice President & Director 
E. B. Redpath, Secretary 



Shares 

11,536 

3,500 

900 

100 



Shares 
1,841,522 



1931 

'innual Stockholders' Meeting, May 28, 1931: Shares 

a - 88, 568 

b 4,125,157 

c None 

d 



Personal 
holdings 



Proxy 



O. D. Dounell. President & Director 

J. K. Kerr, Vice President & Director 

R. J. Berry, Vice President & Director 

W. W. Fleming, Vice President & Director. 
John Mc Fad yen. Vice President & Director 
C. L. Fleming, Vice President & Director.. 

E. B. Redpath, Secretary 

F. A. Billstone, Treasurer. 



Shares 

26, 428 

4,260 

•7,000 

1,800 

2,030 

1,800 

250 

408 



Shares 
4, 125, 157 



1932 

Annual Stockholders' Meeting, May 26, 1932: Shares 

a 92,317 

b 4,578,482 

c None 

d 



O. D. Donnell, President & Director 

R. J. Berry. Vice President & Director. .. 
C. L. Fleming, Vice President & Director 

E. B. Redpath, Secretary 

F. A. Billstone, Treasurer 



Personal 
holdings 



Shares 

31, 028 

7,000 

1,800 

700 

SOS 



Proxy 



Shares 

4, 678, 482 



rONCKXTRATIOX OF ECONOA[TC POWER 10009 

1933 

Annual Stockliulders' Meeting, May 25, 1933: shares 

a 93,391 

b 4,447,751 

c None 

d 





Personal 
holdings 


Proxy 


O. D. Donnell, President & Director 


Shares 

33,045 

4,260 

7,000 

1,800 

800 

408 


Shares 
4, 447, 751 


J. K. Kerr, Vice President & Director _ 


R. J. Berry, Vice President & Director 




C. L. Fleming, Vice President & Director. 




E. B. Redpath, Secretary & Director 




F. A. Billstone, Treasurer ... 









1034 

Annual Stockholders' Meeting, May 24, 1934: Shares 

a 1,424 

b. 4,078,897 

c 35,630 

d 



O. D. Donnell, President & Director- 



Personal 
holdings 



Shares 



Proxy 



Shares 
4, 078, 897 



1935 

Annual Stockholders' Meeting, May 23, 1935: 

a: Shares 

Common 106, 148 

Preferred 9, 894 

b: 

Common 4, 661, 602 

Preferred 440, 686 

c None 

d 





Personal 
holdings 


Proxy 


0. D. Donnell, President & Director: 

Common 


Shares 
34,000 
1,190 

1,800 
17 


Shares 
4,661,602 


Preferred 


440, 686 


0. L. Fleming, Vice President & Director: 
Common. 


Preferred ^ 




. u 





10010 



CONCENTRATION OF ECONOIMIC POWER 



Annual Stockholders' Meeting, May 28, 193G: ^■'>«f«» 

a 121,802 

b 4,297, 128 

c None 

d 



Personal 
Holdings 



Proxy 



O. D. Donnell, President & Director 

W. W. Fleming, Vice President & Director. 
John McFadyen, Vice President & Director 
C. L. Fleming, Vice President & Director. . 

E. B. Redpath. Secretary & Director 

F. A. Billstone, Treasurer & Director 

O. E. McCuUough, Vice President 



Shares 

35,000 

2,306 

3,030 

1,800 

800 

416 

160 



Shares 
4, 297, 128 



1937 

Annual Stockholders' Meeting, May 27, 1937: '""'«'■" 

a._.: 101,996 

b : 4, 175,376 

c None 

d 



Personal 
Holdings 



Proxy 



O. D. Donnell, Presidipnt & Director 

John McFadyen, Vice President & Director 
C. L. Fleming, Vice F*resident & Director.. 
J. C. Doimell II, Diiector 

E. B. Redpath, Secretary <fe Director 

F. A. Billstone, Treasurer & Director 

O. E. McCullough, Vice President 



Shares 

50,750 

3,030 

1,800 

17, 450 

800 

538 

210 



Shares 
4, 175, 376 



1938 

Annual Stockholders' Meeting, Mav 26, 1938: Shares 

a 102,747 

b 4,246,857 

c None 

d 



Personal 
Holdings 



Proxy 



O. D. Donnell, President & Director.- 

C. L. Fleming, Vice President & Director. . 
J. C. Donnell II, Vice President & Director 

E. B. Redpath, Secretary & Director 

F. A. Billstone, Treasurer & Director 

Q. E. McCullough, Vice President.. 



Shares 

51,760 

1,800 

17,550 

800 

538 

210 



Shares 
4, 246, 857 



34. A statement giving specifications for each of the brands and grades of 
gasoline and/or motor fuel distributed by reporting company and its subsidiaries 
and affiliates in domestic marketing operations at the present time. 

Ans. Statement attached, marked Exhibit "O." 

35. A statement showing the annual budgets for each of the years 1936, 1937 
and 1938 allocated by reporting company, its subsidiaries and affiliates for the 
purposes of technical research. 

Ans. None. 



CONCENTRATION OF ECONOMIC POWER 



10011 



Phillips Petroleum Company 

33. With regard to all meetings of stockholders of the reporting company held 
during each of the years 1929 to 1938, both inclusive, submit a statement showing: 

a. Shares of capital stock voted by stockholders in person. 

b. Shares of capital stock voted by proxy exercised by company officers 
and directors. • 

c. Shares voted by proxy exercised by other than company officers and 
directors. 

d. Total shares of stock voted by each officer and director at each meeting, 
both as to personal holdings and by proxy, shown separately. 

Answer. — The required information in respect of stockholders' annual meetings 
is submitted in the following schedule: (No special meetings of stockholders were 
held during this period.) 



(a) Shares of capital stock 
voted by stockholders 
in person 

(b) Shares of capital stock 
voted by proxy exer- 
cised by company of- 
ficers, and directors 
(Proxy Committee) 

(c) Shares voted by proxy 
exercised by other 
than company oflQcers 
and directors..- 

(d) Total shares of stock 
voted by each oflBcer 
and director at each 
meeting, both as to per- 
sonal holdings (1) and 
by proxy (2) shown 
separately: 

(1) Voted in person: 
Alexander, Clyde... 

Kane, J. H 

Kooi)man, H. E 

Phillips, Frank 

Phillips, L. E 

Wing, O. K 

PhUlips, J. a 

Davis, W. N 

Mclntyre, P. J 

Hudson, R. H 

Dewar, J. 8 

Sands, J. M... 

Adams, K. S 

Lemp. Ch. A.. 

Musgrave, C. R 

Rice, F. E 

Trower, H. A 

Smoot, W. C 

Youker, M. P 

Lynn, R. H 

Feist, F. L 

Parr, R. E 

Emery, Don 

(2) Shares voted by 
proxy committee 
Members of com- 
mittee -. 



1, 455, 3225 2 



6,937 
9,895 
9,162 
86,600 
52, 151 
1,100 



1, 455, 3221^ 
F. Phillips 
L. E. Phillips 
O. K. Wing 



187, 109 



11,830 
10,190 



39,400 



2,131 

721 

2,178 

2,395 



1, 659, 197 

F. Phillips 

L. E. Phillips 

O. K. Wing 



1931 



280, 603 



2, 614, 724 



4,230 
2,992 
16,909 
37,100 
64,305 
771 



100 
2,794 
1,535 
1,864 
2,632 

125 
10,500 

453 
2,122 
1,346 



2,614.724 

F. Phillips 

L. E. Phillips 

O. K. Wing 



277, 531 



2, 606, 456M 



10,230 
2,492 
13,905 
37,100 
65, 355 
468 



100 
2,200 
1,486 
1,264 

900 



10,500 
1,053 
2,522 
1,346 



2, 606, 456>/; 

F. Phillips 

L. E. Phillips 

O. K. Wing 



1933 



58, 613 



2, 512, 636 



9,730 
2,192 



37,100 
'""468 



125 
"i,353 



2,512,636 

F. Phillips 

L. E. Phillips 

O. K. Wing 



10012 



CONCENTRATION OF ECONOMIC POWER 





1934 


1935 


1936 


1937 


1938 


(a) Shares of capital stock 
voted by stockholders 
in person 


17, 454 
2, 601, 830 


10,881 
2, 658, 212 


2,281 
2, 511, 382 


2,644 
2, 952, 658 


9,267 


(b) Shares of capital stock 
voted by proxy exer- 
cised by company of- 
ficers, and directors 
(Proxy Committee) 

(c) Shares voted by proxy 
exercised by other than 
company oflBcers and 
directors 


2, 554, 293 


(d) Total shares of stock 
voted by each officer 
and director at each 
meeting, both as to per- 
sonal holdings (1) and 
by proxy (2) shown 
separately: 
(1) Voted in Person: 
Alexander, Clyde 












Kane, J. H 
















5,825 
500 






5,233 


Phillips, Frank 


500 








Phillips, L. E 








Wing, O. K 


300 










Phillips, J. G 










Davis, W. N 




700 








Mclntyre, P. J 










Hudson, R. H 


1,461 










Dewar, J. S 










Sands, J. M 












Adams, K. S 






300 




222 


Lemp. Ch. A 

Musgrave, C. R 


10,500 
153 
822 








163 








Rice, F. E 








Trower, H. A 










Smoot, W. C 


501 


501 

305 

1,010 








Youker, M. P..., 








Lynn, R. H 










Feist, F. L .. 






204 
70 


204 


Parr, R. E 








70 


Emery, Don 








100 


(2) Shares voted by 
proxy committee 
Members of com- 
mittee 


2, 601, 830 

F. Phillips 

L. E. Phillips 

0. K. Wing 


2, 658, 212 

F. Phillips 

J. H. Kane 

0. K. Wing 


2, 511, 382 

F. Phillips 

J. H. Kane 

K. 8. Adafns 


2, 952, 658 

F. Phillips 

J. H. Kane 

K. S. Adams 


2, 554, 293 


. 


F. Phillips 
K. S. Adams 
Don Emery 



rONCENTRATION OF ECONOMTC POWER 
The Pure Oil Company 



10013 



33. With regard to all meetings of stockholders of the reporting company held 
during each of the years 1929 to 1938, both inclusive, submit a statement showing: 





1929 


1930 


1931 


1932 


1933 


(a) Shares of capital stock voted by stockhold- 
ers in person: 
Ans - 


6,735 

2, 523, 904 

None 

191 
2, 523, 904 


9,039 

2, 538, 228 
None 

1,763 
2, 538, 228 


13,066 

2,076,307 

None 

1,680 
2, 076, 307 


11, 173 

3, 180, 395 
None 

2,680 
3, 180, 395 


47,202 


(b) Shares of capital stock voted by proxy 
exercised by company officers and 
directors: 


2, 397, 159 


(c) Shares voted by proxy exercised by other 
than company officers and directors: 


None 


(d) Total shares of stock voted by each officer 
and director at e^ch meeting, both as to 
personal holdings and by proxy, shown 
separately: 
Ans. None, except as follows: 

Henry M. Dawes, Pres. and Dir.: 

Personal 


2,680 




2, 397, 159 


Rawleigh Warner, V. P., Treas. and 
Dir.: 
















W F Burdell Dir* Personal 


1,640 

44 
400 

200 


1,620 

1,484 
600 


1,484 




1,620 


F.'s. Heath, V. P., Secy, and Dir.: 


1,084 
400 




0. H. Jay, Asst. Secy. -Treas.: Personal . 
C. M. Hinman, Asst. Secy.-Treas.: 


400 


400 


W. E. Button, V. P. and Dir.: Per- 






200 


500 


L. 8. Wescoat, V. P., Secy, and Dir.: 









800 






1 




2S0 


C." H. Keller, Asst. Secy.-Treas. : Per- 










B. Q. Dawes, Chairman of Board: Per- 




I 






J. H. McCoy, Dir.: Personal 




1 







(a) Shares of capital stock voted by stockhold- 

ers in person: 
Ans - 

(b) Shares of capital stock voted by proxy 

exercised by "company officers and 
directors: 
Ans.- - 

(c) Shares voted by proxy exercised by other 

than company officers and directors: 
Ans 

(d) Total shares of stock voted by each officer 

and director at each meeting, both as to 
personal holdings and by proxy, shown 
separately: 
Ans. None, except as follows: 

Henry M. Dawes, Pres. and Dir.: 

Personal - 

Proxy 

Rawleigh Warner, V. P., Treas. and 
Dir.: 

Personal-— 

Proxy. - — 

W. F. Burdell, Dir.: Personal. 

F. S. Heath, V. P., Secy, and Dir.: 

Personal - 

C. H. Jay. Asst. Secy.-Treas.: Personal 

C. M. Hinman, Asst. Secy.-Treas.: 
Personal — 

W. E. Hutton, V. P. and Dir.: Personal 

L. S. Wescoai, V. P., Secy, and Dir.: 

Personal ■ 

D. H. Mulloney, Asst. Secy.: Personal.' 
C. H. Keller, Asst. Secy.-Treas.: Per- 
sonal 

B. O. Dawes, Chairman of Board: 

Personal 

J. H. McCoy, Dir.: Personal 



14, 607 

2,315,633 
None 



1,000 
2, 315, 633 



44 
400 



1935 



7,845 

2, 102, 105 
None 



1,000 
2, 102, 105 



44 

400 



800 

344 

5,123 



1936 

4.240 

2,073,840 
None 



1,000 
2, 073, 840 



8,772 

2, 325, 925 
None 



100 
2, 325, 925 



1,540 



1,000 



1938 



21, ISO 

4, 362, 698 
None 



1,000 
4, 362, 698 



400 



740 
1,536 



Note. — Preferred shareholders are entitled to four votes for each share held and common shareholders are 
entitled to one vote for each share held. 



10014 



GONCENTRATTON OF EPOXOIMIC TOWER 
SiiKiJi Union C)ii> Cuiu-okation 



Item S3. — With regard to all meetings of stockholders of the reporting company 
held during each of the years 1929 to 1938, both inclusive, submit a statement 
showing: 

A. Shares of capital stock voted by stockholders in person, 

B. Shares of capital stock voted by proxy exercised by company officers and 
directors. 

C. Shares voted by proxy exercised by other than company officers and direc- 
tors. 

D. Total shares of stock voted by each officer and director at each meeting, 
both as to personal holdings and by proxy, shown separately. 



Date of meeting 



April 21, 1038... 

April 15, 1937 _. 
Mny 21, lOM ._ 

May Hi, li(3,'; _ 
May 17, 1934.... 



Feb. 5, 1934.- 
May 18, 1933. 



May 19, 1932. 
May 21, 1931. 
May 15, 1930. 



Julys, 1929.. 
May Ifi, 1929. 



Shares of capital stock 



Voted by 
stockhold- 
ers in per- 
son- 



7,329 



3,205 
17, 083 



1,875 

393 
620 



424 
4,779 
4,630 



Voted by 
proxy exer- 
cised by 
company 
oflBeers and 
directors 



9, 035, 905 

9, 101, 770 
9, 474, 340 

9, 786, 004 

9,871,144 

9, 436, 449 
10, 081, 605 



10, 148, 301 
10, 449, 387 
10, 510, 608 



10, 019, 361 
10,629.913 



Voted by 
proxy exer- 
cised by 
other than 
company 
officers and 
directors 



23,428 



4,939 



2,795 



Total shares of stock voted by each officer and 
director at each meeting, both as to personal 
holdings and by proxy, shown separately 



R. O. A. van der Woude.. 

S. W. Duhig 

R. O. A. van der Woude . 

S. W. Duhig . 

R. G. A. van der Woude.. 

W. C. Stagg.. - 

J. C. van Eck 

LewLS L. Clarke 

Bayard Dominick 

El-nest Sturm 

R. Airey 

R. Q. A. van der Woude. 

J. C. van Eck.. 

Lewis L. Clarke 

Bayard Domiuick.. 

Ernest Sturm 

J. C. van Eck 

Charles Hayden 

J. C. van Eck 

J. C. van Eck . 

A. O. Choate 

Charles Hayden 

J. C. van Eck 

J. C. van Eck 

R. Airey 

J. C. van Eck 

Avery D. Andrews . 

J. C. van Epk 

J. C. van Eck 

Avery D. Andrews ., 



Personal 
holdings 



7,000 



2,700 

25 



2,900 
4,650 



By proxy 



8,412, 151 
176 

623, 575 

9,161,770 

9,385,371 

88, 969 



9,619,178 

160,880 

9, 008, 422 

202, 722 

9, 436, 449 

9, 858, 691 

222,914 

10. 148, 301 
10, 449, 387 



2, 298, 454 
8, 212. 154 
10,019,361 
2,4)7,759 
8, 212. 154 



CUNC'EXTKATION OF ECONOMIC POWEK 10015 

Skelly Oil Company 

33. With regard to all meetings of stockholders of the reporting company 
held during each of the years 1929 to 1938, both inclusive, submit a statement 
showing: A. ._ B. ._ C. _. D. __. 
Answer: 

Note. — The company's equity stock was classed as "capital stock" up to 
and including May 14, 1930, since which date it has borne the classification 
"common stock." 

1929 

Annual meeting of October 18, 1929 

a. 61,504 shares voted by stockholders in person. 

b. 717,415 shares voted by officers and directors as proxy. 

c. (None) shares voted by others as proxy. 

d. 743,473 total shares voted by officers and directors, shown separately: 

Personal holdings: 

C. C. Herndon 1,000 

W. G. Skellv 24, 113 

F. T. Hopp : 945 

26, 058 
As proxy: 

C. C. Herndon, and W. G. Skelly, as joint proxy 717, 451 

1930 

Special meeting of May I4, 1030 

a. 5,707 shares voted by stockholders in person. 

b. 708,438 shares voted by officers and directors by proxy. 

c. 200 shares voted by others as proxy. 

d. 711,625 total shares voted by officers and directors, shown separately: 

Personal holdings: 

C. C. Herndon 200 

W. G. Skelly 2, 108 

F. T. Hopp 859 

Richard T. Lyons 9 

H. M. Stalcup 11 

3, 187 
As proxv: 

C. "C. Herndon and W. G. Skelly, as joint proxy 708, 438 

Annual meeting of October 18, 1930 

a. 1,156 shares voted by stockholders in person. 

b. 762,508 shares voted Tjy officers and directors as proxy. 

c. (None) shares voted by others as proxy. 

d. 762,987 total shares voted by officers and directors, shown separately: 

P( rsonal holdings: 

F. T. Hopp ..... . 459 

Richard T. Lyons 9 

H. M. Stalcup . --- 11 

479 
A.S proxv: 

C. C. Herndon and W. G. Skelly, as joint proxy ' 762, 508 



10016 CONCENTRATION OF ECONOMIC POWER 

1931 

Annual meeting of October 19, 1931 

a. 142,616 shares voted by stockholders in person. 

b. 616,618 shares voted by officers and directors as proxy. 

c. (None) shares voted by others as proxy. 

d. 750,151 tcrtal shares voted by officers and directors, shown separately: 

Personal holdings: 

W. G. Skelly 131, 108 

F. T. Hopp ... 1,559 

Richard T. Lvons. . . 679 

H. M. Stalcup 11 

W. t. Atkins 176 

133, 533 
As proxy: 

C. C. Herndon and W. G. Skelly, as joint proxy 616, 618 

1932 

Annual meeting of October 18, 1932 

a. 140,106 shares voted by stockholders in person. 

b. 582,050 shares voted by officers and directors as proxy. 

c. (None) shares voted by others as proxy. 

d. 721,655 total shares voted by officers ahd directors, shown separately: 

Personal holdings: 

C. 0. Herndon 300 

W. G. SkeUy 137, 178 

F. T. Hopp . 1,538 

Richard T. Lyons 579 

H. M. Stalcup . 11 

139, 606 
As proxy: 

C. C. Herndon and W. G. Skelly, as joint proxy 581, 950 

F. T. Hopp .... 100 

582, 050 

1933 

Annual meeting of October IS, 1933 

a. 140,475 shares voted by stockholders in person. 

b. 572,657 shares voted by officers and directors as proxy. 

c. (None) shares voted by others as proxy. 

d. 712,832 total shares voted by officers and directors, shown separately: 

Personal holdings: 

C. C. Herndon . 900 

W. G. Skelly . 137, 158 

F. T. Hopp : 1,538 

Richard T. Lyons 579 

140, 175 
As proxy: 

C. C. Herndon and W. G. Skelly, as joint proxy 572, 657 



PONrEXTUATION OF ECONOMIC POWER 10017 

Annual nicding of October IS, lfJ34 

a. 141,113 shares voted by stockholders in person. 

b. 582,593 shares voted by officers and directors as proxy. 

c. (None) shares voted by others as proxy. 

d. 721,168 total shares voted l)y officers and directors, shown separatel3': 

^rsonal holdings: 

C. C. Herndon 900 

W. G. Skelly _, 136,958 

F. T. Hopp 138 

Richard T. Lyons .^ 579 

138, 575 
As proxv: 

C. C. Herndon and W. G. Skelly, as joint proxy 582, 593 

1935 

Annual meeting of October 18, 1985 

a. 3,489 shar /oted >^' .stockholders in person. 

b. 802,947 shares voted by officers and directors as proxy. 

c. 300 shares voted bj' others as proxy. 

d. 806,226 total shares voted by officers and directi^rs, shown separately: 

Personal holdings: 

C. C. Herndon 2,500 

Richard T. Lyons 579 

Henry C. Olcott 200 

3, 279 
As proxy: 

F. T. Hopp 100 

C. C. Herndon and W. G. Skelly, as joint proxy 245, 290 

Jos. G. Carey and Chas. E. Hane, as joint proxy 557, 557 

802, 947 

(Note. — Above figures do not inchide 33,268 shares of preferred stock 
voted at the meeting.") 

1936 

Special meeting of January 3, 1936 

a. (None) shares voted by stockholders in person. 

b. 760,177 shares voted by officers and directors ar proxy. 

c. (None) shares voted by others as proxy. 

d. 760,177 total shares voted by officers and directors, shown separately: 

Personal holdings : 

(None.) 
As proxy: 

Jos. G. Carey, Chas. E. Hane, Henry C. Olcott and Richard T. 

Lyons as proxy committee . 760,177 

(Note. — Above figures do not include 39,811 shares of preferred stock 
voted at the meeting.) 



10018 CONCENTKATTON OF ECONOMin POWER 

Spccidl iiicclitif/ of Maij t, l'J,}(! 

a. (Nouu) aharcs voted by stockholders in person. 

b. 750,170 shares voted by officers and directors as proxy. 

c. (None) shares voted by others as proxy. 

d. 750,170 total shares voted by officers and directors, shown separately: 

Personal holdings: 
(None.) 

As proxy: 

Jos. G. Carey and Chas. E. Hane, as joint proxy 557, 557 

Jos. G. Carey, Chas. E. Hane, W, G. Skelly and C. C. Herndon, 

as proxy committee 192, 613 



750, 170 



(Note. — Above figures do not include 41,857 shares of preferred stock 
ropresent(!d at the meeting.) 

Adjourned special meeting of June 1, 1936 
(Adjourned from May 1, 1930) 

a. (None) shares voted by stockholders in person. 

b. 775,195 shares voted by officers and directors as proxy. 

c. (None) shares voted by others as proxy. 

d. 775,195 total shares voted by officers and directors, shown separately: 

Personal holdings: 
(None.) 

As proxy: 

Jos. G. Carey and Chas. E. Hane, as joint proxy 557, 557 

Jos. G. Carey, Chas. E. Hane, W. G. Skelly and C. C. Herndon, 

as proxy committee 217, 638 



775, 195 

(Note. — Above figures do not include 42,087 shares of preferred stock 
represented at the meeting.) 

Adjourned special meeting of July 1, 1936 

(Adjourned from June 1, 1936) 

a. (None) shares voted by stockholders in person. 

b. 775,195 shares voted by officers and directors as proxy. 

c. (None) shares voted by others as proxy. 

d. 775,195 total shares voted by officers and directors, shown separately: 

Personal holdings: 
(None.) 

As proxy: 

Jos. G. Carey and Chas. E. Hane, as joint proxv 557, 557 

Jos. G. Carey, Chas. E. Hane, W. G. Skelly and C. C. Herndon, 

as Proxy Committee 217, 638 



775. 195 



(Note. — Above figures do not include 42,087 shares of Preferred Stock 
represented at the meeting.) 



CONCENTKATION OF ECONOMIC POWER 10019 

Adjourned special meeting of September 1, 19S6 
(Adjourned from July 1, 1936) 

a. (None) shares voted by stockholders in person. 

h. 775,195 shares voted by officers and directors as proxy. 

c. (None) shares voted by others as proxy. 

d. 775,195 total shares voted by officers and directors, shown separately: 

Personal holdings: 
(None.) 

As proxy: 

Jos. G. Carey and Chas. E. Hane, as joint proxy 557, 557 

Jos. G. Carey, Chas. E. Hane, W. G. Skelly and C. C. Herndon, 

as Proxy Committee 217, 638 

775, 195 

(Note. — Above figures do not include 42,087 shares of Preferred Stock 
represented at the meeting.) 

Annual meeting of October 19, 1936 

a. 1,000 shares voted by stockholders in person. 

b. 869,722 shares voted by officers and directors as proxy. 

c. (None) shares voted by others as proxy. 

d. 870,722 total shares voted by officers and directors, shown separately: 

Personal holdings: 

Richard T. Lyons 1, 000 

As proxy : 

Jos. G. Carey and Chas. E. Hane, as joint proxy 557, 557 

Jos. G. Carey, Chas. E. Hane, W. G. Skelly and C. C. Herndon, 

as proxy committee 312, 165 

869, 722 
(Note. — Above figures do not include 28,262 shares of preferred stock 
voted at the meeting.) 

1937 

Annual meeting of October 18, 1937 

a. 2,366 shares voted by stockholders in person. 

b. 702,765 shares voted by officers and directors as proxy. 

c. 705 shares voted by others as proxy. 

d. 702,765 total shares voted by officers and directors, shown separately: 

Personal holdings: 

(None) 
As proxy: 

C. C. Herndon, W. G. Skelly, Emil Kluth and Arch H. Hyden, 

as proxy committee 702, 765 

(Note. — The preferred stock was not eligible to vote at the meeting.) 

1938 

Annual meeting of October 18, 1938 

a. (None) shares voted by stockholders in person. 

b. 735,945 shares voted by officers and directors as proxy. 

c. (None) shares voted by others as proxy. 

d. 735,945 total shares voted by officers and directors, shown separately: 

Personal holdings: 

(None) 
As proxv: 

C. C. Herndon, W. G. Skelly, EmU Kluth and Arch H. Hyden, 

as proxy committee _ 735, 945- 

(Note. — The preferred stock was not eligible to vote at the meeting.) 

May 24, 1939. 

124401— 40— pt. 17-A 5 



10020 ('<>i\<lKiVlliATIOi\ OF ECONOMIC POWER 

Socony-Vacuum Oil Company, Incorporated, 26 Broadway, New York, N. Y. 

Item- 33. — With regard to all meetings of stockholders of the Reporting Com- 
pany held during each of the years 1929 to 1938, both inclusive, submit a state- 
ment showing: 



Date of Meeting 


A 

Shares 
Voted 

by 
Stock- 
holders 

in 
Person 


B 

Shares Voted 

by Proxy 

Exercised by 

Company 

OflScers 

and 
Directors 


C 

Shares Voted 
by Proxy 

Exercised by 
Other than 
Company 

OflBcers and 
Directors 


D 

Total Shares Voted by each Officer and 
Director both as to personal holdings 
and by proxy 




Name 


Personal 
Holding 


Proxy 


May 31, 1929 (Annual): 
Proposition #1 


■ 136 

136 

65, 764 

55, 241 

942 
802 
230 

4,967 
3,340 

38,070 

37, 632 

„38, 156 

37, 374 

2,665 

2,975 

5,765 
00,696 


12, 288, 893 
12, 289, 418 

12, 650, 569 

12, 964, 139 

13, 472, 926 
13, 472, 206 
22, 674, 788 

21, 472, 529 
23, 815, 253 

22, 990, 178 
22,986,105 
22, 985, 438 
22, 981, 855 
20, 977, 646 

20, 186, 777 

20, 665, 670 
21, 231, 093 


None 
None 
None 

None 

20 

20 

None 

None 
12, 507 

26,323 

26, 323 

19, 258 

7,225 

43, 961 

12, 000 

14,000 
3,739 


H.L.Pratt 

H. E. Cole 


(See note) 


12, 288, 678 
200 




C. F. Meyer... 




15 


Proposition #2 


H. L. Pratt 




12, 289, 203 


H. E. Cole 




200 




C. F. Meyer . 




15 


May 29, 1930 (Annual).. 


H. L. Pratt 




12, 650, 325 


H. E. Cole . 




194 




C. F. Meyer . 




40 




F. Ewing 




10 


May 28, 1931 (Annual).. 


H. L. Pratt 




12,964,012 


C. F. Meyer 




127 


July 30, 1931 (Special): 


C. F. Meyer... 




13, 472, 926 


Proposition #2 

May 26, 1932 (Annual).. 


C. F. Meyer 




13, 472, 206 


H. L. Pratt . 




22, 674, 716 


F. S. Fales 




72 


May 25, 1933 (Annual) 


H. L. Pratt 




21, 472, 529 


December 14, 1933 


C. E. Amott... 




23,815,253 


(Special). 
May 31, 1934 (Annual): 


F. S. Fales 




22, 989, 542 




A. F. Corwin . 




278 




H. F. Sheets.. 




358 




F. S. Fales 




22, 985, 469 




A. F. Corwin 




278 




H. F. Sheets . 




358 


Proposition #2 


F. S. Fales 




22, 984, 802 


A. F. Corwin... 




278 




H. F. Sheets... 




358 


Proposition #3 


F. S. Fales . .. 




22, 981, 219 


A. F. Corwin... 




278 




H. F. Sheets... 




358 


May 31, 1935 (Annual).. 


F. S. Fales . .. 




20, 977, 402 


A. F. Corwin .. 




137 




H.F. Sheets 




90 




J. A. Brown 




17 


May 28 1936 (Annual) 


F. S. Fales . .. 




20, 186, 495 




A. F. Corwin... 




185 




H. F. Sheets... 




97 


May 27, 1937 (Annual). 


F. S. Fales 




20, 665, 345 




A. F. Corwin .. 




325 


May 26, 1938 (Annual) 


F. S. Fales 




21, 230, 667 




E.R. Brown... 




374 




H. F. Sheets... 




52 











Note.— Records now available do not show number of shares actually voted by individual directors at 
meetings, it having been the practice at most meetings for each director to give a proxy for his shares to the 
director designated by the management to vote all shares represented at the meeting through proxies on 
the form sent out by the management. 



(.'OMCKNTKATION OF iiCOMOMlC POWER 10021 
Standaed Oil Company (Indiana) 

Temporary National Economic Committee, Washington, D. C. Questionnaire for Oil 

Companies 

Answer to question S3 

1929 

3-7-29 — Annual stockholders' meeting: Shares 

A . 671,599 

B 2,838,257 

C 4,955,420 

fR. W. Stewart] 

D { E. G. Seubert ^Proxy Committee 2,838,257 

If. T. Graham J - 

R. W. Stewart 16, 810 

E. G. Seubert 6,058 

Allan Jackson 2, 220 

R. H. McElroy 805 

E. J. Bullock 1,920 

Amos Ball 631 

R. E. Humphries 1, 283 

L. L. Stephens... 110 

C. J. BarkduU 740 

8-27-29 — Special stockholders' meeting: 

A _ 24,547 

B 8,889,822 

C None 

fE. G. Seubert] 

D ] Allan Jackson[Proxy Committee 8,889,822 

If. T. Graham J = 

E. G. Seubert 9,007 

Allan Jackson 3, 900 

F. T. Graham__.. 892 

R. H. McElroy 1,718 

E. J. Bullock.. 3,916 

R. E. Humphries 1,412 

Amos Ball 1, 250 

C. J. BarkduU 1,295 

Gentry Cash 977 

Bruce Johnstone 150 

M. A. Traylor » 150 

1930 

3-6-30 — Annual stockholders' meeting: 

A 28,795 

B 11,344, 119 

C None 

fE. G. Seubert] 

D< Allan Jackson>Proxy Committee 11, 344, 119 

If. T. Graham J 

E. G. Seubert 9, 007 

Allan Jackson 2, 820 

F T.Graham 1,025 

R. H. McElroy 1, 729 

E. J. Bullock 4, 016 

Amos Ball 1, 250 

R. E. Humphries 2, 353 

C. J. BarkduU 1, 095 

Gentry Cash 977 

Bruce Johnstone 400 

M. A. Traylori 150 

A. W. Peake> :___.-^ 659 

' These shares not voted in person but are Included in the shares voted Iry the Prosy Committee. 



10022 CONCENTRATION OF ECONOMIC POWER 

Answer to question SS — Continued 

1931 

5_7_31 — Annual stockholders' meeting: ahares 

A 36,636 

B 12,945,277 

Q __ I 952 

'f'K G.'Seubertf ' 

D| Allan Jackson [Proxy Committee _. 12, 945, 277 

[F. T. GrahamJ 

E. G. Seubert 10,408 

Allan Jackson 1, 308 

F. T. Graham 1,023 

R. H. McElroy 1,810 

E. J. BuUock 4,316 

Amos Ball... 950 

R. E. Humphries 523 

C. J. Barkdull , -" 1, 100 

Bruce Johnstone 650 

A. W. Peake 659 

L. L. Stephens 1 445 

R. E. Wilson i . 201 

M. G. Paulus » 577 

1932 

5-5-32 — Annual stockholders' meeting: 

A 33,380 

B._ 12,012, 140 

C 75 

^ {i.'T.'GrahfS} ^^^''^ Committee 12,012, 140 

E. G.'Seubert 10,408 

F. T. Graham 1,023 

R. H. McElroy 1,310 

E. J. Bullock 4, 316 

Amos Ball . 735 

R. E. Humphries 523 

C. J. Barkdull 1, 550 

M. A. Traylor 150 

Bruce Johnstone 325 

A. W. Peake 659 

L. L. Stephens 445 

R. E. Wilson - 201 

M. G. Paulus 577 

1933 

5-4-33 — Annual Stockholders' meeting: 

A -- 40,338 

B 10,737,474 

C 1,490 

fE. G. Seubert ] 
D ^ Allan Jackson V Proxy Committee 10,737,474 

I F. T. Graham ! 

E. G. Seubert - . 12,021 

Allan Jackson 2, 169 

F. T. Graham 1, 272 

r-^ R. H. McElroy .._. 1, 591 

E. J. Bullock . 5, 052 

Amos Ball 1,335 

C. J. Barkdull. _ „ 2, 100 

Bruce Johnstone 300 

L.L.Stephens 948 

R. E. Wilson 534 

M. G. Paulus 831 

A. W. Peake» - 1,071 

• These shares not voted In person but are Included in shares voted by the Proxy Committee. 



CONCENTRATION OF ECONOMIC POWER 10023 
Answer to question S3 — Continued 

1014 

4-5-34 — Annual stockholders' meeting: S**""'* 

A 41,436 

9,515,016 

c:::::::::::::::::::::::::: 125 

fE. G. Seubertl 

D{C. J. Barkdull Proxy Committee --- 9,515,016 

[Allan Jackson J 

E. G. Seubert 12,021 

C. J. Barkdull 2, 100 

Allan Jackson 861 

R. H. McElroy 2,383 

E. J. Bullock_. 5,052 

Amos Ball 1,335 

A. W. Peake 1.071 

L. L. Stephens 948 

R. E. Wilson 600 

M. G. Paulus 831 

F. T. Graham 1,272 

H. F. Glair > 216 

1935 

4-25-35 — Annual stockholders' meeting; 

A .- 38,20.5 

B".""1 9,823,263 

c::::::::: ::::::: - 263 

fE. G. Seubert) 

DJC. J. BarkdulU Proxy Committee 9,823,263 

[Allan Jackson J 

E. G. Seubert 12,021 

C. J. Barkdull -- 2, 100 

Allan Jackson 861 

R. H. McElroy - 2,385 

E. J. Bullock 5,052 

Amos Ball 1,335 

L. L. Stephens 948 

M. G. Paulus - 831 

H. F. Glair 215 

F. T. Graham 1, 284 

Bruce Johnstone ' 100 

A. W. Peake i. - - 1,071 

193C 

4-30-36 — Annual stockholders' meeting: 

A 45,702 

B 10,076,691 

ci:: ::::::i:::::::::i:"::i:::":i 125 

fE. G. Seubert 1 

D \C. J. BarkduU[Proxy Committe -- 10, 076, 691 

[Allan Jackson J 

E. G. Seubert.- 14,313 

C. J. Barkdull --- 2,999 

Allan Jackson 1, 539 

R. H. McElroy 3, 101 

E. J. Bullock... - 5,747 

Amos Ball 2, 177 

Bruce Johnstone • 100 

A. W. Peake 1,751 

M. G. Paulus 1,423 

H. F. Glair 658 

p. T. Graham 1, 621 

L. L. Stephens ». 1.761 

' These shares not voted in person but are included in the shares voted by the Proxy Committee. 



10024 CONCENTRATION OF ECONOMIC POWER 

Answer to question 33 — Continued 

1937 

4-29-37 — Annual stockholders' meeting: sharex 

A 37,522 

B . 10,603,519 

C-__ 2,960 

IE. G. Seubertl 

DJC. J. Barkdull [Proxy Committee 10,603,519 

[Allan Jackson J 

E. G. Seubert 14, 313 

C. J. Barkdull 2, 999 

Allan Jackson i _ _ _ 100 

R. H. McElroy .. 3,101 

Amos Ball . 2,177 

A. W. Peake 1, 751 

L.L.Stephens __ 1,761 

M. G. Paulus 1,423 

H. F. Glair . 352 

J. F. Stone 700 

E. J. Bullock 1 ^ 5, 047 

Bruce Johnstone * __ 100 

F. T. Graham i 1, 521 

1938 

4-28-38 — Annual stockholders' meeting: 

A 41,561 

B 10,513,896 

C 225 

fE. G. Seubertl 

D<C. J. Barkdull [Proxy Committee 10, 513,896 

LAllan Jackson] 

E. G. Seubert---, 14,313 

C. J. Barkdull 2,999 

Allan Jackson 100 

J. F. Stone* 25, 573 

E. J. BuUock 5,047 

Amos Ball 2, 177 

Bruce Johnstone 125 

A. W. Peake . 1, 751 

L. L. Stephens 1,761 

M. G. Paulus 1, 423 

H. F. Glair ^ 352 

R. F. McConnell2___ 645 

F. T. Graham 2 1,521 

' These shares not voted in person but are included in the shares voted by the Proxy Committee. 
' 24,873 shares voted by proxy. 



CONCENTRATION OF KCONOMIC POWER 



10025 



Answer to question SS — Continued 

12-22-38— Special stockholders' meeting: ■S'*"''" 

A 42,436 

B 9,229,506 

ClIIIIIIII 96 

fE. G. Seubert] 

D]C. J. BarkdulUProxy Committee 9,229,506 

[Allan JacksonJ 

E. G. Seubert 15,961 

C. J. BarkduU 3,848 

Allan Jackson 100 

J. F. Stone - 700 

A. W. Peake 2,409 

Amos Ball 2,924 

E. J. Bullock 1 5,914 

M. G. Paulus 2,026 

H. F. Glair__._ 788 

R. F. McConnell 853 

L.L.Stephens 2,554 

F. T. Graham i 1,788 

Bruce Johnstone ' 125 

I These shares not voted in person but are included in the sharas voted by the Proxy Coinuiittee. 



Standard Oil Company (N. J.) 

33. Statement with regard to aU meetings of stockholders held during each of 
the years 1929 to 1938, both inclusive, showing: 





(a) 


(b) 


(0 


(d) 


Year 


Shares of Capi- 
tal Stock voted 
by Stockholders 
in Person 


Shares of Capital 

Stock voted by 

Proxy exercised 

by Company 

Officers and 

Directors 


Shares voted by 
Proxy exercised 
by Other than 
Company Offi- 
cers and 
Directors 


Total shares of 
stock voted by 
each officer and 
director at each 
meeting both as 
to personal hold- 
ing and by proxy 


1929 


None 

132 

859 

None 

36 

10 

45 

18 

'563 

734 


17, 418, 614 
18,880,976 
17,021,303 
18, 765, 286 
18, 199, 954 
17, 802, 685 
18, 345. 139 
18, 882, 776 
18, 706, 798 
18, 590, 845 


None 
None 
None 
None 
None 
37, 961 
45, 548 
39, 503 
34, 824 
5,089 


Note.— Personal 


1930 - 


holdings of each 


1931 - - 


officer and di- 


1932 


rector are voted 


1933 - 


by proxy by the 


1934 


directors casting 


1935 


the vote as 


1936 


proxy, and are 


1937 


included in col- 


193? 


umn "b" of this 




statement. 



10026 CONCENTRATION OF P:C0N0M1(3 POWER 

Standard Oil Company (Ohio) 

Exhibit # 13. Dates of meetings of stockholders of the Standard Oil Company, an 
Ohio corporation, and record of the votes cast at those meetings 





April 1, 
1929 


April 7, 
1930 


October 
13. 1930 


January 
16, 1931 


April 6, 
1931 


October 
2, 1931 


April 4, 
1932 


(a) 


1,149 
368, 065 


930 
401,802 


471 

418,688 


200 
401, 074 






25 


(b).. 


673. 734 


503, 80S 


556,864 


(c) 




















Totals 


369, 214 


402, 732 


419, 159 


401, 274 


573, 734 


503, 808 


556, 879 




AprU 3, 
1933 


April 2, 
1934 


April 1, 
1935 


April 6, 
1936 


April 5. 
1937 


April 4. 
1938 


(a) 


100 

500, 559 

800 




710 
548, 632 


630 
565, 750 


100 
649. 758 


200 


(b) 


522, 618 


662,585 


(c) 


6,538 
















Totals 


561, 459 


522, 618 


649, 342 


666, 380 


549, 858 


569,323 







(d) It is not customary for officers and directors of the company to vote their own shares, and in many 
ipstances such shares have not been voted at all. If and when voted, it has usually been accom- 
plished through a proxy or proxies. Officers and directors when serving as proxies do not east sepa- 
rate ballots, but instead join in sigTiing one ballot for all shares on which the voting rights have been 
proxied to them. 



Sun Oil Company 

33. With regard to all meetings of stockholders of the reporting company held 
during each of the years 1929 to 1938, both inclusive, submit a statement showing: 

a. Shares of capital stock voted by stockholders in person. 

b. Shares of capital stock voted by proxy exercised by company officers and 
directors. 

c. Shares voted by proxy exercised by other than company officers and 
directors. 

d. Total shares of stock voted by each officer and director at each meeting, 
both as to personal holdings and by proxy, shown separately. 





Shares of Capital Stock Voted By- 


Date of Stockholders Meeting 


Stockholders 
In Person 


Proxy Exer- 
cised by 
Officers & 
Directors 


Proxy Exer- 
cised by other 
Than Officers 
and Directors 


March 12, 1929 .... 


24,462 
60,122 
84,025 
123, 701 
120, 193 
107, 462 
238,775 
592,666 
400,278 
360,124 


1, 128, 365 
1, 208, 799 
1, 308, 379 
1, 293, 221 
1, 256, 561 
1, 465, 788 
1, 489, 181 
1, 201, 690 
1, 630, 362 
1, 723, 178 


None 


March 11, 1930 ^- 


None 


March 10, 1931 


None 


March 8, 1932 '. 


None 


March 14, 1933 


None 


March 13, 1934 


None 


March 12, 1935... 


None 


March 10, 1936 


None 


March 9, 1937 


None 


March 8, 1938 


None 







CM)NCEN"TltAri()N OF ECONOMIC POWER 



10027 



Total Slxares of Stock Voted by Each Officer & 
Director 



J. Howard Pew 



Personal 
Holdings 



By Proxy 



J. N. Pew, Jr. 



Personal 
Holdings 



By Proxy 



March 12, 
March 11 
March 10, 
March 8, 
March 14, 
March 13, 
March 12, 
March 10, 
March 9, 
March 8, 



1929. 
, 1930. 
, 1931. 
1932.. 
, 1933. 
, 1934. 
, 1935. 
. 1936. 
1937.. 
1938 -. 



March 12, 
March 11, 
March 10, 
March 8, 
March 14, 
March 13, 
March 12, 
March 10, 
March 9, 
March 8, 



,1929. 
, 1930. 
, 1931 . 
1932.. 
, 1933. 
, 1934 . 
, 1935. 
, 1936. 
1937.. 
1938.. 



March 12, 
March 11, 
March 10. 
March 8, 
March 14, 
March 13 
March 12, 
March 10, 
March 9, 
March 8, 



, 1929 
, 1930. 
, 1931 . 
1932 _. 
, 1933. 
, 1934. 
, 1935. 
, 1936. 
1937.. 
1938.. 



30, 822 
32. 596 
32, 861 
43, 835 
59, 211 
190, 632 
268, 810 



965, 177 
026, 757 
02.% 756 
770, .514 
297, 090 
232,116 
535, 637 



14, 213 



991,471 



16,888 
19, 056 
33, 323 



127, 224 
152, 366 
354,266 



304, 015 



1, 341, 172 



248,588 
260, 314 



386, 788 
1, 180, 205 



Frank Cross 



J. Edgar Pew 



March 12, 1929 
March 11, 1930 
March 10, 1931 
March 8, 1932. 
March 14, 1933 
March 13, 1934 
March 12, 1935 
March 10, 1936 
March 9, 1937- 
March 8, 1938. 



6,472 
7,164 
7,810 
7,949 
7,048 
7,720 
7,763 
7,890 
8,312 



136, 894 
243, 622 
154,398 
115,100 
131, 781 
158, 698 
257, 065 
279, 165 
350. 157 
382, 006 



11, 557 
7.463 
8,283 
8,834 



Arthur E. Pew, Jr. 



Samuel B. Eckert 



15, 300 
33. 6.53 
34,720 



40, 756 
42, 825 



10,086 
11,104 
11,256 



12, 855 
13, 922 



15, 632 
15, 883 



Robert E. Lamberton 



John O. Pew 



1,780 
2,050 



17, 879 
17, 879 
15, 895 
16, 473 
15, 814 



17. 709 



10028 



OONCKNTRATION OK ECONOMIC POWER 






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10032 CONCENTRATtON OF ECONOMIC POWER 

Union Oil Company of California 

[Schedule XIII] 

Shares of Capital Stock voted by proxy exercised by company officers and 
directors at Annual Meetings of Stockholders held during the years 1929 to 1938 
inclusive: 



1929 » 3, 070, 503 

1930 1 :.-- 3, 515, 602 

1931 ' 3, 655, 422 

1932 » 3, 667, 920 

1933 . .- 3,209,419 

I Includes shares owned by Union Oil Associates. 
Union Oil Company of California in December, 1932. 



1934 2, 839, 313 

1935 3, 044, 152 

1936 2, 952, 825 

1937 3, 010, 944 

1938 3,064,680 

The Union On Associates was merged with and into 



Shares of Capital Stock voted by proxy exercised by other than company officers 
and directors ,at Annual Meetings of Stockholders held during the years 1929 
to 1938 inclusive: 



1929 993 

1930 37, 683 

1931 

1932 606 

1933 4, 855 



1934 38,403 

1935 43,536 

1936 43,316 

1937 34, 988 

1938 39, 266 



Shares of Capital Stock voted by stockholders in person at Annual Meetings 
of Stockholders held during the years 1929 to 1938 inclusive: 



1929 32, 806 

1930 . 27, 226 

1931 19, 383 

1P32 25, 433 

1933 245, 405 



1934 171,093 

1935 158,801, 

1936 138,681 

1937 119, 158 

1938 126, 198 



Exhibit No. 1315 

Statement Prepared for the Temporary National Economic Commiti'EE 

(Based upon replies furnished by oil companies in replv to Question 32 and supple- 
mentary question to Items 11 k (1) and 11 k (2) of Questionnaire of the Tempo- 
rary National Economic Committee — "Exhibit No. 1137") 

Statement B 

By Christopher Del Sesto, Special Assistant to the Attorney General, Department 
of Justice, Washington, D. C. 

The staff of the Temporary National Economic Committee requested that I 
review the replies submitted by the oil companies in response to the questionnaire 
of this Committee with respect to (a) the cost of gasoline at the refinery gate and 
the costing policies of the oil companies, and (b) the classification of income by 
branches and departments of the business. This statement is a brief summary 
based upon the material furnished by the oil companies to this Committee. 

Two questions are being constantly asked in the petroleum industry — 

1. What is the cost of gasoline, the principal product of petroleum, at the 
refinery gate? 

2. Which of the four branches of the petroleum industry are profitable and which 
are unprofitable; is any one branch of the industry used to subsidize another 
branch or branches of the industry? 

Notwithstanding eff'orts on the part of this Committee to obtain answers to 
these two questions, they have not yet been answered satisfactorily. 

(1.) With respect to the cost of gasoline, some of the major oil companies have 
taken the position that it is impossible to compute its cost; others have so quali- 
fied the data submitted that it is of no practical value; while others have furnished 
satisfactory data. 

i The matter of determining unit costs is of great importance in the petroleum 
ndustry. This industry is engaged in exploiting a diminishing natural resource 
considered next to food in importance in our national economy. Consequently, 
both the Federal Government and the state governments have a vital interest in 
this industry. 

Furthermore, since proration of crude oil production has now become an accepted 
policy in the petroleum industry, it is important that exact unit cof^ be deter- 
mined, not only for refining, but for all other processes. The evidence before 
this Committee has indicated that proration is to some extent guided by price 
and that it necessarily affects price. Since proration is so intimately related to 
the price structure of petroleum, it would seem, therefore, highly desirable. If 
not absolutely necessary, that the cost of production be known by those most 
vitally concerned — the regulating authorities and the consuming public. The 
episode of recent months, when some of the oil producing states shut_ down oil 
wells in order to restore the price of crude oil to the level existing prior to the 
recent cuts in prices averaging approximately twenty cents per barrel, cannot be 
intelligently judged unless it can be determined from accurate costs what a fair 
price for crude oil should be. 

The matter of costs of a basic commodity such as gasoline is now of even greater 
interest because of the current charges of profiteering in connection with certain 
commodities during the present limited emergency. The President in his letter 
of September 29, 1939, to the Chairman of this Committee stated: 

"AU of us, of course, want to see producers, middlemen and retailers 
receive fair prices for what they sell, and all of us recognize that, in certain 
fields, such fair prices are probably not as yet being received. But none of 
us wants to see the cost of living unjustifiably increased or prices become so 
unreasonably high as to interfere with our national defense. 

"It seems to me, therefore, that during this periodj the TNEC might well 
keep a constant eye on increases in prices of our bwio materials and, in the 

10033 



10034 CONOENTliATION OF KCOAOMIO POWER 

light of past and present circumstances, study the facts to determine whether 
there is profiteering, or whether such increases are legitimate." 

How can this Committee ascertain if increases in prices are legitimate or not, 
if costs cannot be determined? If costs are not known, how can this Committee 
determine if profits are reasonable? 

While the petroleum industry has been investigated and studied from time to 
time, those making the investigations and studies have been handicapped by the 
lack of accurate and comparable data as to costs. Consequently, the subject of 
costs and profits have been in many cases mere academic economic discussions 
with no satisfactory conclusions. 

In view of this circumstance, this Committee may wish to consider the desira- 
bility of legislation requiring large companies dealing in basic commodities and 
who are engaged in interstate commerce to adopt uniform accounting and cost 
systems. It appears from the answers in response to this Committee's question- 
naire that, in the absence of such uniform accounting or cost systems, no informed 
-judgment is possible on any economic question of the utmost importance to the 
people of this country. 

(2) With respect to the analysis of income by branches of the industry, some 
of the major oil companies stated that such a classification was impossible; 
others stated that assets could be allocated by branches of the industry, but that 
revenue could not; others did furnish the data to the Committee, although in 
some case there were substantial qualifications. 

If it is true that these large organizations in the petroleum industry are unable 
to determine the classification of their assets and income by various branches of 
the industry, this raises a broad issue with respect to the study of the concentration 
of economic wealth and power in this country. These questions might well be 
raised by this Committee: 

Can it be that, M'hen a corporation reaches beyond a certain size, it is 
impossible for its ofl^cials to make a proper accounting of its affairs? 

Can it be that, when a corporation reaches beyond a certain size, that the 
management itself is unable to determine which of the various segments of 
the enterprise are profitable and which are unprofitable? 

Can it be that large enterprises are able to exist, regardless of their efficiency 
or inefBciency, by the sheer momentimi of size though the management may 
not know how the enterprises are progressing in their various fields? 

If the answer to these questions should be in the affirmative, it is a matter of 
great concern to this country and should be pursued in greater retail by this 
Committee. A large corporation such as the Standard Oil Company (New Jer- 
sey), for example, which utilizes over two billion dollars in capital has a tremendous 
efl"ect upon our national economy. Within the petroleum industry it must of 
necessity affect the prices in all four branches of the industry, and in many of the 
fields it is the leader because of its very size and because of the volume of business 
transacted by it. Can it be that such a leader in the industry, accounting for 
approximately one-fourth of the total assets of the twenty major oil companies, 
has no standard or guide by which it can determine the result of its operations 
in the various branches of the industry? 

A discussion of the data submitted to this Committee on these two questions 
by the major oil companies follows: 

I. COST OF GASOLINE AT THE REFINERY GATE AND COSTING POLICY OF THE MAJOR 

OIL COMPANIES 

The Temporary National Economic Committee in its questionnaire to the oil 
companies asked for the cost of gasoline during the year 1938 at the refinery gate 
(exclusive of any selling expenses). The Committee also asked for a brief ex- 
planation of the casting policy followed by the oil companies. 

Two major oil companies. Standard Oil Company (California) and Mid-Con- 
tinent Petroleum Corporation, failed to reply to the Committee's questionnaire. 

Three major oil companies, Shell Union Oil Corporation, Sun Oil Company, 
and Union Okl Company of California, maintained that unit cost data were not 
available and that unit costs could not be determined. 

Shell Union Oil Corporation reported to the Committee as follows: 

"It is a recognized principle in the oil industry that it is impossible to 
determine separately the costs applicable to a particular product manufac- 
turecj. The costs of manufacturing finished products are joint and inseparar 



CONCENTRATION OF ECONOMIC POWER 10035 

ble and the products themselves are commingled and blended before, during 
and after the refining process. The reporting company's subsidiary refining 
companies do not even, in all cases, keep the elements of cost segregated by 
individual refineries. In an endeavor to give information which may be 
useful in connection with this question, the following information is attached, 
viz. the total expense up to the refinery gate, the additional selling, ad- 
ministered and other expense, and the segregation, by volume, of products 
sold during 1938." 

The Sun Oil Company also reported that unit costs could not be obtained and 
reported to the Committee as follows: 

"There is no exact method for the determination of costs in a multiple 
product industry. The method our company follows is that of taking entire 
costs and applying these equally against the products produced in proportion 
to their gallonage. When these products are sold a profit or loss is sustained 
depending upon whether or not the costs as heretofore determined are greater 
or less than the selling price. On the theory that no profit is realized until 
the product is sold, this method results in an accurate determination of 
profits earned." 

The Union Oil Company of California, in reporting that it was impossible to 
determine the cost of gasoline, stated to the Committee: 

"The company feels it should not be called upon to furnish the information 
requested in this question as the determination of costs involves so many 
constantly varying factors, some of them more or less arbitrary, that the 
results obtained without detailed explanation would neither be fair to the 
company nor serve as an accurate basis for any computations the committee 
might desire to be made thereon." 

Three major oil companies, 'Atlantic Refining Company, Socony-Vacuum Oil 
Company, Incorporated, and Tide Water Associated Oil Company, reported that 
accurate unit costs for gasoline could not be obtained. Upon further request of 
the Committee, however, these companies did furnish the unit costs used bj' them 
for inventory purposes during 1938. 

In its original reply to the Committee, Socony-Vacuum Oil Company Incor- 
porated, stated: 

"The problem of ascertaining the net income of the several branches or 
activities of an integrated operation, is if anything, even more insoluble than 
the problem of obtaining net investment by reason of an additional factor, 
namely, the determination of the cost of product and services, especially the 
former. We have no means of knowing, or even approximating, except on a 
most arbitrary basis, what a gallon of gasoline "costs" our marketing depart- 
ment when it comes from our own refinery and is only one of many multiple 
products made from a single barrel of crude. It is true that, for income tax 
purposes and the ascertainment of surplus for dividend purposes, we must 
estabhsh some "cost" for our products. Here, however, "ve are dealing with 
cost to the Company a whole, not to any of its branches, and even in this 
case we are compelled to use arbitrary methods. For this inventory purpose, 
we use a method which is primarily the sales realization method which is 
acceptable to accountants and tax officials generally, although it i? well 
understood by all concerned that it is only an arbitrary approximation of 
something which can never be scientifically ascertained, namely, the true 
cost of individual products. 

The best cost accountants have wrestled with this problem within the 
various companies, within the American Petroleum Institute and elsewhere. 
All agree that the question "What does a product cost?" cannot be accurately 
answered. Messrs. Morland and McKee in "Accounting for the Petroleum 
Industry" (1925); McKee in "Handbook of Petroleum Accounting" (1938); 
The U. S. Tariff Commission's Report to the House of Representatives on 
Crude Petroleum and Its Liquid Refined Products, (Report No. 30, Second 
Series, 1932) ; and the Report of the Federal Trade Comn?ission on the Pacific 
Coast Petroleum Industry, Part No. 1, Production, Ownership and Profit 
(1921), to say nothing of other authoritative pronouncements, all unite in 
stating that, while the total cost of all products is easily obtainable, the cost 
of any one product is obtainable only on son.e arbitrary basis, and the cost 
attached to one product affects the cost of all other products. In other 
words, there is no way to figure the actual cost of any one product;. 

124-^91— 40— pt.l7-A 6 



10036 CONCENTRATION OF ECONOMIC POWER 

The Tide Water Associated Oil Company also reported, in its original report 
that it was impossible to determine the cost of gasoline, stating: 

•"'We have no method of accurately computing the cost of each product 
manufactured from Crude Oil, chiefly due to two facts: first, because it is 
impossible to assign to each product its just proportion of the cost of the 
raw material, the largest single item of cost, and secondly, because the 
refining processes are continuous and there is such an interrelation between 
them as to make the allocation of the processing costs to individual products 
impossible without major arbitrary assumptions. 

A number of arbitrary costing methods have been attempted to approxi- 
mate costs of certain products under a given set of conditions and assumptions. 

We have experimented with various methods, but in all cases arbitrary 
assumptions must be employed in the division of costs and value of by- 
products which defeat any attempt to determine profit or loss on each product 
by accurate costing." 

One major oil company, Gulf Oil Corporation, furnished the average unit cost 
per barrel of crude oil refined at its various refineries, but did not allocate the 
cost among the various refined products produced. This company reported to 
the Conimittee that it is impractical to determine the actual per unit cost of a 
gallon of gasoline at the refinery gate. 

Ten major oil companies, Empire Gas and Fuel Company, Consolidated Oil 
Corporation, Continental Oil Company, The Ohio Oil Company, Phillips Pe- 
troleum Company, The Pure Oil Company, Skelly Oil Company, Standard On 
Company (Indiana), Standard Oil Company (Ohio), and The Texas Corporation, 
did furnish unit cost of gasoline at the refinery gate for the year 1938. 

One major oil company, Standard Oil Company (New Jersey) furnished the 
aggregate costs of operating the refineries of its various subsidiaries during 1938. 
It was asked to supplement this data by showing the per unit cost of gasoline. 
Under date of September 19, 1939, this company reported to the Committee that 
this information was being compiled and that it w«uld be submitted as soon 
as ready. 

A summary of the unit costs of gasoline for 1938 furnished by the ten companies 
referred to above, and a summary of the unit prices used for inventory purposes 
by the three companies mentioned above, are shown in the attached Table A. 
The detailed replies on this subject received from all companies, both majors and 
non-majors, are included in Appendix I. 

In studying the unit costs furnished, it will be noted that the unit costs vary 
considerably not only among companies, but also among difi'erent refineries of 
the same company. Some of the factors which cause the variations in cost are 
the size of the refineries and the location of the refineries. 

It should also be pointed out that some of the companies have qualified the 
figures presented. Consequently these qualifications should be taken into con- 
sideration in a study of the figures. 

II. CLASSIFICATION OF INCOME BY BRANCHES AND DEPARTMENTS OF THE BUSINESS 

The petroleum industry is divided into four branches: (1) production, (2) 
transportation, (3) refining and manufacturing, and (4) marketing. Many -of 
the major oil companies operate both in the domestic field and in the foreign 
field. Some of the major oil companies, in addition, have investments which are 
not related to the petroleum industry. 

The questionnaire of the Temporary National Economic Committee sought to 
ascertain the amount of investment by the oil companies in the various branches 
and departments of the business, and also the amount of income received in the 
various branches and departments of the business. 

The replies received in response to the questionnaire varied considerably. One 
group of oil companies reported that it was impossible to classify either the assets 
or the income by branches of the industry. A second group reported that, while 
assets could be classified according to the various branches or departments of the 
business, it was impossible to classify income. A third group furnished informa- 
tion showing an analysis of the assets and income by various branches of the 
industry, although in some cases there were numerous qualifications to the data 
furnished. 

Three companies, Standard Oil Company of California, Mid-Continent Petro- 
leum Corporation and The Atlantic Refining Company have not furnished the 
,jial7 iis ri^qucsted by the Committee, at the time of this report. 



CONCENTRATION OF ECONOMIC POWER 10037 

Among the companies which reported that the data requested could not be 
furnished were Standard Oil Company (New Jersey), Sun Oil Company, The 
Texas Corporation, and Tide Water Associated Oil Company. 

In a letter dated September 1, 1939, J. Howard Pew, President of the Sun Oil 
Company stated as follows: 

"In a mass-production industry it is impossible to accurately determine 
the income that accrues in any particular branch or division. None of the 
several arbitrary methods for determining the effectiveness of interdepart- 
mental operations is of value excepting only for purposes of comparison, 
and no two such methods produce like results. The very breaking down of 
the industry into divisions is purely arbitrary, as no two integrated companies 
would agree as to the activities that should be allocated to each division. 
In the ultimate determination of our profits or losses we take the total 
amount of money received from the sale of all our products and from this 
deduct all our operating costs, including those of transportation, and the 
difference is our profit or loss. . 

"As regards the analysis of consolidated assets covered in the form which 
you sent us, it is obviously impossible to break down the cash in the banks 
so that a part of this cash should appear as a credit to each of these arbitrary 
divisions. The same reasoning applies to practically all current assets." 

The Texas Corporation, through George W. Ray, Esq., attorney, stated in a 
letter of August 28, 1939, as follows: 

"Your letter of August 14th to The Texas Corporation has been referred 
to me for reply. 

"It is impossible to compile the data you request by September 5th, 1939 
or by September 18th, 1939. 

"Furthermore, the information requested involves the use of so many 
arbitrary assumptions that the information when compiled, in our opinion, 
would be valueless. 

"I assume that in view of this you will withdraw your request for the 
additional information." 

George J. Murray, Jr., Assistant to the President of Tide Water Associated 
Oil Company, in a letter to the Secretarv of the Committee, dated September 8, 
1939, stated: 

"We have again carefully considered what information might be given to 
the Committee indicating divisional profits of our Company. If in my 
conversation with you I failed to make it clear, please be advised that our 
Company has not adopted and is not using an accounting system designed 
to reflect profits by divisions. The development of such an accounting 
system has been considered by our executives from time to time but it has 
always been recognized that the profits of the divisions of an integrated oil 
company can only be estimated by arbitrarily assigning to each division a 
profit on products or services -supplied to other divisions of the Company. 
Another circumstance making it impracticable in our opinion to determine 
divisional profits is the fact, ag you will appreciate, that several classes of 
important assets and liabilities, and carrying charges, cannot readily be 
apportioned and allocated to the various operating divisions of the Company, 
although all divisions share in such assets, liabilities and carrying charges 
and would have to consider them in determining divisional profits. Also, 
we consider that it is impossible to determine what proportions of the capital 
stock and surplus of the Company may be said to be employed by the various 
branches of our Company. Therefore, for the foregoing reasons, our execu- 
tives have always believed it impracticable to determine a basis for such 
interdivisional profits, and for that reason the income of the Company is 
determined and considered only on a consolidated basis for the Company 
as a whole. It has always been thought that an inter-divisional profit system 
would be meaningless and of no value by reason of arbitrary assumptions 
necessary for the computation of divisional profits. 

"For the foregoing reasons, I regret to advise again that we cannot give 
you any information regarding divisional profits. Please be assured that 
we wish to cooperate with the Committee in its investigation, but we cannot 
furnish the requested information because it is not available and we know 
pf no practicftble manner in which to prepare it." 



10038 CONCKNTRATION OF KOONOMIC POWER 

The second group of companies which stated that, while assets could be classi- 
fied by branches and departments of the business, it was impossible to classify 
income, were Socony- Vacuum Oil Company, Inc. and Shell Union Oil Corporation. 

Socony-Vacuum Oil Companj', through Carl E. Kieser, Esq. Counsel, reported 
to the Committee on September 1, 1939 as follows: 

"This is in reply to your letter of August 14th in which you ask for an 
analysis, supplemental to items 11-k (1) and 11-k (2), of our assets and 
income classified by branches or departments for each of the years 1936, 
1937 and 1938. 

"For the reasons indicated in our original answer to question 11, to which 
we refer you, we have not found any satisfactory formula which will give 
us a sound and correct analysis of the kind you seek. To make any such 
breakdown it will be necessary to use many arbitrary formulae. Arbitrary 
departmental allocations will not reflect the true relationship of our depart- 
ments and functions. Our business is so completely integrated that it is 
not logical to consider it as broken up into separate parts. 

"No profits are realized until the product is finally disposed of; and the 

'pricei which is then obtained establishes the profit for all activities. An 

intermediate department, such as refining, cannot be said to make a profit 

by making goods and then transferring the inventory to another department 

at an arbitrary figure. 

"Throughout the entire study made by your Committee we have cooperated 
full despite the burden and expense involved, and it is in this same spirit 
that we are now submitting to you a partial analysis showing those assets 
which with some degree of soundness may be specifically assigned to the 
departments or functions indicated in your letter. The qualification 'some 
degree of soundness' has been used because, even in the case of such items 
as fixed assets, which at first blush would seem to be easily assignable to a 
given function, we find numerous instances where a plant is being used for 
two or more functions. To illustrate, a tank at a refinery may be used part 
of the time for refining purposes and at other times for marketing storage. 
We even have cases where certain substantial items of equipment are used 
for as many as three functions." 

Shell Union Oil Corporation reported to the Committee on September 1, 1939 
as follows: 

"We have your letter of August 14th requesting additional information in 
connection with items 11-k (1) and 11-k (2) of your original "Questionnaire 
for Oil Companies." 

"We have again gone quite thoroughly into this matter of segregating 
assets as well as income on a departmental basis and we attach information 
which we have compiled from our own records and those of our subsidiary 
companies. 

"In connection with the attached analysis of assets, we should like to point 
out that we have had to resort to approximations and estimates in making 
some of these allocations of intangible assets, cash and the like. The at- 
tached segregation of assets, therefore, is not as carried in our own books of 
account and has been especially prepared in an endeavor to meet your par- 
ticular request. 

"In connection with the request for segregation of gross revenue and net 
income, we must again refer you to our previous letter dated May 27, 1939. 
Our companies operate on the basis of a single unit and we do not know of any 
satisfactory basis of theoretically calculating the net income for various divi- 
sions or departments." 

The third group of companies which did furnish classification of assets and 
income by branches of the industry include: 

Empire Gas and Fuel Company 
Arkansas Fuel Oil Company 
Cities Service Oil Company (Pa.) 
Consolidated Oil Corporation 
Continental Oil Company 
Gulf Oil Corporation 
Skelly Oil Company 
Standard Oil Compp.ny (Indiana) 
Standard Oil Company (Ohio) 



(XJNOKNTRATION OF PJCONOMIC POWER 10039 

Union Oil Company of California 
The Ohio Oil Company 
Phillips Petroleum Company 
The Pure Oil Company 

The results reported by this third group will be discussed in detail. From a 
review of the replies furnished to the Committee, it is apparent that the transporta- 
tion branch of the industry, in terms of rate of return on assets used, is the most 
profitable of the four branches. On the same basis the marketing branch is the 
least profitable. The data submitted seems to support, in part at least, the charges 
made from time to time that in the most competitive branch of the industry — 
marketing — the industry suffers a loss; while in the one branch of the business in 
which the major oil companies have a high degree of concentration — transpor- 
tation — the profits are high. It seems, therefore, that there is some merit to the 
charge made by non-integrated companies that the transportation branch is used 
in part by integrated companies to subsidize the other branches of the business, 
or, at least, that the rates charged in the transportation branch are too high. 

The rate of return as used in this summary is computed upon the net income 
before interest and dividends in each branch of the industry and is compared with 
the total assets invested in each branch of the industry. The figures reported are 
those which were submitted to this Committee by the oil companies themselves. 
It should be pointed out that tlie rate of return as thus used is not necessarily the 
same rate of return computed by such regulatory authorities as the Interstate 
Commerce Commission for rate making purposes. The figures reported by the 
companies represent those which the companies have obtained from their own 
financial records or from their o'vn statistical records. In computing the rate of 
return it was decided to use net income before interest and dividends as a basis 
so as to place all companies on a comparable basis regardless of the proportion in 
which their fimds were received through the sale of capital stock, or by the 
issuance of funded debt. 

The reporting major oil companies in which tlie transportation branch showed 
the highest rate of return in domestic operations are listed below with the years 
in which this branch was the most profitable indicated: 

Arkansas Fuel Oil Companv ' 1936 

Cities Service Oil Co. (Pa.) i 

Empire Gas & Fuel Company i 1936 

Consolidated Oil Corporation 1936 

Continental Oil Companv 

Gulf Oil CorporaLioi, 1936 

SI >^lv Oil Ccnipar- : 1936 

S' .I'.dard Oil Crmp^.iv (Ind.) 1936 

Standard Oil Company (Ohio) 1936 

The Ohio Oil Company 

Phillips Petroleum <^oni[)any 1936 

The Pure Oil Coi: }• ny 1936 

' Subsidiaries of Cities Per, i -i; Company (Delaware). 

Those fompani. s in v/hich the marketing branch shows the lowest rate of return 
in domestic operations are listed below. It will be noted that most of the com- 
panies showed losses in this branch of the business and that only three companies 
showed profits in any of the years covered: (The years in which profits were shown 
are indicated by an asterisk; in all other years there were losses.) 

Arkansas Fuel Oil Companv 1936 

Cities Serviee Oil Co. (Pa.)" 1936 

Empire Gas & I'uel Company 1936_ 

Consolidated Oil Corporation 1936 

Continental Oil Companv 1936 

Skelly Oil Companv_ _ . _' ' 1936 

Standard Oil Companv (Ind.) 1936 

The Ohio Oil Company 1936 

Phillips Petroleum Company ' 1936 

1 Subsidiaries oT Cities Service Company (Delaware). 

All replies received (both from major companies and non-majors) to the question- 
naire on this subject are included in detail in Appendix II.* A summary of the 
replies from the reporting majui co'-npa'^'es with respeot to the rate of return 
from the various branches follows. 

• P. 9993 et seq., supra. 



1937 


1938 


1937 


1938 


1937 


1938 


1937 


1938 


1973 


1938 


1937 


1938 


1937 


1938 


1937 


1938 




1938 


1937 


1938 


1937 


1938 



1937 


1938 


1937 


1938 




1938 


1937 


1938 


1937 


1938 


• 1937 


• 1938 


' 1937 


1 1938 


1937 


1938 


1 1937__ 





10040 



CONCENTRATION OF ECONOMIC POiWER 



Some of the reporting companies qualified the data submitted, and these quali- 
fications are included in the summary. However, even giving full consideration 
to these qualifications, the data do show the trend of the earnings and are therefore 
of value in determining the profitable and unprofitable branches of the industry. 

The rate of return in various branches and departments of the business, and the 
overall rate of return for all branches and department, by companies for the 
years 1936 to 1938, follow (L=Loss) : 

ARKANSAS FUEL OIL COMPANY AND SUBSIDLARIE8 



1936 



1937 



1938 



Domestic Petroleum Branches: . 

Production 

Transportation --. 

Refining & Manufacturing 

Marketing 

Other Branches: 

Foreign petroleum branches 

Investments (in unconsolidated petroleum affiliates). 

General investments 

Miscellaneous 



12.3% 

12.6 
0.4(L) 
a8(L) 



12.2% 
26.0 

2.6 

8.0(L) 



3.6 



Overall rate of return. 



10.8 



8.0 



29.7 
10. 5(L) 
11.4(L) 



5.7 



4.3 



CITIES SERVICE OIL CO. (PA.) AND SUBSIDIARIES 



Domestic Petroleum Branches: 

Production 

Transportation 

Refining and Manufacturing 
Marketing 

Overall rate of return 



13.0% 
8.4 
1.7 
5. 6(L) 



0.8 



6.3% 
18.6 
5.6 
9.0(L) 



2.1 



6.8% 
12.5 

3. 2(L) 
14: 9(L) 



6. 2(L) 



SKELLY OIL COMPANY AND SUBSIDIARIES 



Domestic Petroleum Branches: 

Production .- 

Transportation 

Refining and Manufacturing 
Marketing 

Other Branches: 

Investments 

Miscellaneous 

Overall rate of return 



8.0% 
30.0 
21.0 

3.0 

31.0 
12. 0(L) 



10.0 



12. 0% 
26.0 
19.0 
3.0 

35.0 
15. 0(L) 



12.0 



6.0% 
16.0 
3.0 
1.0 

19.0 
16.0(L) 



6.0 



The incoming reports, 1936-37, from general investments reported by the 
company include the income received from its investment from Great Lakes 
Pipe Line Company. This is not a subsidiary and is not controlled by the 
reporting companj' but this company uses the facilities to ship its gasoline to 
various points in its marketing territory. Therefore, the income thus reported 
can be considered as income from the transportation branch of the business. 

The income for 1938 from general investments includes the income from the 
Great Lakes Pipe Line Company and also the income from an investment from 
the East Texas Refining Company in which the Skelly Oil Company had less 
than a majority interest. 



STANDARD OIL COMPANY aNDIANA) AND SUBSIDIARIES 






1936 


1937 


1038 


Domestic Petroleum Branches: 


10. 59% 
16.68 
16.61 
3. 20 (L) 

4.04 
3.28 


12.05% 

17.66 

1Z03 

L79 

6.28 
2.20 


7.34% 


Transportation - 


14.23 


Refining and Manufacturing . 


2.00 


Marketing „ 

Other Branches: 

General Investments.. . . . . 


L65 
3.87 




3. 11 (L) 






OveraU rate of return ' ..- . - 


6.70 


7.85 


3.93 







I After consolidating adjustments and eliminations. 



(CONCENTRATION OF ECONOMIC POWER 



10041 



The Standard Oil Company (Indiana) in furnishing the above information 
suggested to the Committee that no accurate conclusion could be made from the 
data furnished, but that it had furnished the information simply to comply 
with the request of the Committee. 

In explaining the segregation of income of the company to the various branches 
and departments, the company reported that it was its practice to transfer 
products from one branch or department to the other at a value based generally on 
the market. 

The company also stated that direct expenses were allocated to the particular 
department involved and that indirect expenses were pro-rated on a basis accept- 
able to the company. It further reported that departmental income was income 
before the elimination of inter-company and inter-departmental transactions. 

THE PURE OIL COMPANY AND SUBSIDIARIES 



1936 



1937 



1938 



Domestic Petroleum BranchOvS: 

Production 

Transportation _ 

Refining and Manufacturing _ - 

Marketing 

Other Branches; 

Investments (in unconsolidated petroleum affiliates) 

General investments 

Miscellaneous... 

Overall rate of return: 

Before elimination of intercompany accounts.. 
After elimination of intercompany accounts. _ . 



25. 74% 
34.05 
42. 78(L) 
4.12 

20.02 
4.84 
6.39 



7.59 
5.76 



23. 83% 
27.88 
16. 44 (L) 
2.68 

23.70 
5.02 



8.06 
7.16 



17. 25% 
21.91 
25. 17(L) 
0. 71(L) 

i.s.es 

2.86 
2.67 



4.25 
3.15 



The Pure Oil Company reported that the departmental figures reported are 
used by the company for internal statistical purposes only and that in no sense 
do the figures represent comparable results if the departments are considered as 
independent operations. The company stated that the transfer of products by 
the departments is made at arbitrary prices and that it is impossible to completely 
segregate aU costs and incomes applicable to each department. 

The investments in other Consolidated Petroleum Affiliates represents the 
income received from an investment in a foreign subsidiar}\ 



GULF OIL CORPORATION AND SUBSIDIARIES 






1936 


1937 


1938 


Domestic Petroleum Branches: 

Production 


13.0% 
18.0 

1. (L) 

1.0 

7.0 

5.0 
32.0 
52. (L) 


11.0% 
23.0 

0.4(L) 

3.0 

6.0 

4.0 
33.0 
32. (L) 


5.0% 


Transportation 


23.0 


Refining and Manufacturing . 


13.0(L) 


Marketing . . _. 


5.0 


Other Branches: 

Foreign petroleum branches 


7.0 


Investments (in unconsolidated petroleum affiliates) 


1.0 


General investments 


23.0 


Miscellaneous 


40. (L) 






Overall rate of return _, 


4.0 


6.0 


.3.0 







THE OHIO OIL COMPANY AND SUBSIDIARIES 



Domestic Petroleum Branches: 
Production. ' 



■Transportation 

Heflnmg and Manufacturing— 

Marketing... 

Other Branches: 

Investments (in unconsolidated petroleum affiliates) . 

General Investments.. :. 

Miscellaneous 



Overall rate of return . 



5.29% 
17.07 
28.57 

9. 00 (L) 



5.99 



8.13% 
25.17 
30.77 

9. 17 (L) 



2.94 
77.78 



9.29 



3. 29% 
22. 82 
4. 76 (L) 
9. 17 (L) 



2.00 



4.04 



10042 CONCENTRATION OF ECONOMIC POWER 

PHILLIPS PETROLEUM COMPANY AND SUBSIDIARIES 



Domestic Petroleum Branches: 

Production -- 

Transportation -- 

Refining and Manufacturing 

Marlieting... 

Other Branches: , ^ ^ ■ , ^ 

Investments in other companies— petroleum industries (not 
consolidated) _ - 

General investments - --- 

Overall rate of return.. .-. --- -- 



1936 



9. 18% 
16.42 
13.14 

4.03 



31.58 
50.00 



9.87 



1937 



11.70"/ 

23.33 

5. .37 

3.30 



32.00 
133. 33 



11.62 



1938 



3.08% 
21. 55 
6. 76 (L) 
4.46 



15.38 
33.33 



4.50 



EMPIRE GAS & FUEL COMPANY AND SUBSIDIARIES 



Domestic Petroleum Branches: 

Production 

Transportation 

Refining; and Manufacturing .-- 

Marketmg 

Other Branches: 

Foreign petroleum branches.- -- 

Investments (in unconsolidated petroleum affiliates) . 

General Investments 

Miscellaneous 



3.2% 
3.5 

0.6(L) 
4. 4 (L) 



Overall rate of return 



31.1 
''5.' 7' 



3.6 



4.0% 
3.8 

3.3(L) 
2.9(L) 



5.9 



4.0 



3. 9% 
0.01 (L) 
2. (L) 
3. 9 (L) 



38.2 



6.0 



4.3 



CONSOLIDATED OIL CORPORATION AND SUBSIDIARIES 



Domestic Petroleum Branches: 

Production 

Transportation — - 

Refining, Manufacturing and Marketing.. 

Other Branches: . ^ . , wiw ^ 

Inve.stmonts (in unconsolidated petroleum amliates) . 

Oenern 1 In vpstmcnts ." -- 

Miscellaneous. 



Overall rate of return. 



10. 0% 
30.0 
2. (L) 

3.0 
9.0 



6.0 



13. 0% 
30.0 
20. (L) 



1.5.0 



5. 0% 
25.0 
4.0(L) 



10.0 



Consolidated Oil Corporation, in connection with its report, submitted certain 
explanations which are set out in full in Appendix TI. 

CONTINENTAL OIL COMPANY AND SUBSIDIARIES 



Domestic Petroleum Branches: 

Production - 

'transportation 

Refining and Manufacturing — 

Marketing - 

Other Branches: 

Investments (in unconsolidated petroleum affiliates) - 

General investments - j 



Overall rate of return . 



1936 



13.3.5% 
20.00 
24.06 
4.11(L) 

.5.71 
31.11 



20. 83% 
26.09 
20.29 
4. to (L) 

16.13 
35.55 



13.42 



6. 97% 
20.00 
2.76 
6.43(1.) 

9.30 
40.00 



Some of the qualifications of the data submitted by the company are included 
in its reply which is quoted in full in the Appendix. 

Standard Oil Company (Ohio) and subsidiaries 



Domestic Petroleum Branches: 
Production 

Transportation 

Refining and Manufacturing — 

Marketing 

Other Branches: 

Investments (in unconsolidated 

Miscellaneous 

Overall rate of return 



■U'Aim affiliates). 



1936 



75. 98% 
4.86 
6.24 

23. 13 



1937 



7. 60% 

3.77 

6.41 

21.68 



5.33 



1938 



8.18% 

2.02(L) 

6.14 



3.12 



(J(>NCENTRATION OF ECONOMIC POWEll 10043 

Standard Oil Company (Ohio) subuuitted the following explanation with its 
report: 

"The reporting company operates in the refining and marketing branches 
of the petroleum industry chiefly, to a lesser extent it is engaged in trans- 
portation of petroleum products by pipe line, truck and barge, and to an 
almnst negligible extent, in production. The accounting methods used by 
the reporting company are such that the books of account of the company 
do not separately reflect the profits or losses of the various branches of the 
industry in which the reporting company is engaged. Any figures submitted, 
therefore, by the reporting of its profits or losses in the various branches of 
tlie industry would be purely estimates based upon assumed figures as to 
the inter-departmental transfer prices and arbitrary allocations of various 
overhead expenses, none of which are contained in the present system of 
company accounting." 

The company's explanation of the method used in the classification of assets, 
gross income and net profit by branches of the industry is quoted in full in 
Appendix II. 

UNION OIL COMPANY OP CA.LIFOKNIA AND SUBSIDIARIES 

The Union Oil Company of California segregated gross revenue by departments 
and prices of the business but did not segregate the net income. In explaining 
tie company furnished the following statement: 

"Gross revenue has been segregated according to departments to show the 
revenues obtained by such departments, as transportation where services 
are performed for other parties. Gross revenues from sales of crude and 
refined oil products are shown under the marketing department. Net in- 
come (as specified before interest and dividends) has been placed in the 
unallocated column. While in the main, it is true that all departrnental 
activities enter into the realizating of net income, it is impracticable, if not 
impossible, to determine to what extent each department contributed to 
that net income; further, no so-called departmental profit can be considered 
realized until the products are finally sold by the marketing department. 



Table A. — Summary of unit costs of gasoline by companies and refineries (at the 

refinery gate), 1938 

ATLANTIC REFINING COMPANY Naphtha (per 

Refinery: C"""") 

Philadelphia Refinery $0. 0569 

Atreco Refinery..- . . 0515 

(Represent figures used for inventory purposes for the 
year 1938.) 

CONSOLIDATED OIL CORPORATION Gasoline 

(all gradet) 

Location of Refinery: P"" «"""<"» 

East Chicago, Ind $0. 0599 

Kansas City, Kans : . 0564 

Coffeyville, Kans .0534 

Sand Springs, Okla._ . 0468 

Parco, Wyo .0553 

Fort Worth, Tex .0518 

Houston, Tex. (Light Oil.Plant) . 0519 

Marcus Hook, Pa . 0546 

Wellsville, N. Y -. .. .0567 



10044 CONCENTRATION OF ECONOMIC POWER 

Table A. — Summary of unit costs of gasoline by companies and refineries {at the 
refinery gate), 19S8 — Continued 

CONTINENTAL OIL COMPANY Untt cost of 

Refinery: gasoUne 

Ponca City Refinery $0. 0497 

Baltimore Refinery , 0543 

Wichita Falls Refinery . 0463 

Glenrock Refinery . 0509 

Farmington Refinery. . 0596 

Artesia Refinery . 0457 

Denver Refinery^ . 0634 

Albuquerque Refinery i . 0630 

Lewiston Refinery \ . 0719 

EMPIRE GAS AND FUEL COMPANY 

Refinery: 

East Chicago, Ind., Refinery $0. 0609 

Ponca City, Okla., Refinery . 0527 

Okmulgee, Okla., Refinery .0582 

OHIO OIL COMPANY 

Refinery: 

Lovell, Wyo., Refinery $0. 06729402 

Ft. Worth, Tex., Refinery . 05366362 

Bristow, Okla., Refinery . 05352129 

Robinson, Dl., Refinery . 05931547 

PHILLIPS PETROLEUM COMPANY 

Location of Refinery: 

Borger $0. 04569 

Okmulgee . 05639 

Kansas City___ . 05986 

PURE OIL COMPANY Oasoline cost 

Refinery: ?«»■ oaiion 

Cabin Creek, W. Va $0. 06683 

Heath, Ohio . 06709 

Muskogee, Okla . 07300 

Smiths BlufiF, Tex . 05634 

Toledo, Ohio . 07200 

Midland, Mich .04927 

SKELLY OIL COMPANY UnU cost of 

gasoline 

Refinery: El Dorado, Kans., Refinery $0.04904 

BOCONY- VACUUM OIL COMPANY, INC. Average (per 

Brand of Gasoline: gallon) 

Magnolia $0. 0413 

General . 0458 

Socony- Vacuum .0556 

Overall Averages . 0520 

(Represent investory valuations.) 

STANDARD OIL COMPANY (INDIANA) Unit cost of 

Refinery: gasoline 

Whiting, Ind., Refinery $0. 0543 

Wood River, 111., Refinery . 0532 

9ugar Creek, Missouri, Refinery . 0501 

Casper, Wyo., Refinery . 0641 

Neodesha, Kansas, Refinery 0556 

GreybuU, Wyoming . 0500 

STANOLIND OIL AND GAS COMPANY 
[Subsidiary of Standard Oil Comyany (Indiana)] 

Location of Refinery: Superior, Louisiana $0. 0504 



CONCENTRATION OF ECONOMIC POWER 10045 

Table A. — Summary of unit costs of gasoline by companies and refineries {at the 
refinery gate), 19S8 — Continued 

UTAH Olli REPINING COMPANY 

[Subsidiary of Standard Oil Company (Indiana)] Average (per 

Brand of Gasoline: cation) 

Ethyl Gasoline $0. 0762 

Pep Gasoliije - .0713 

Stanolind Gasoline . 0684 

STANDARD OIL COMPANY (OHIO) Unit cost of 

Refinery: gatollne 

Cleveland Refinery... $0. 0685 

Toledo Refinery .0666 

Lima Refinery • . 0667 

LATONIA REPINING CORPORATION 
[Subsidiary of Standard Oil Company (Ohio)] 

Refinery: Latonia Refinery . $0. 0659 

THE TEXAS CORPORATION 

The Texas Company (Delaware): 

Port Arthur Works $0. 0594 

Houston Works .0529 

West Dallas Works... _. . 0508 

San Antonio Works .0509 

El Paso Works .0611 

Amarillo Works 0480 

West Tulsa Works .- - . 0573 

Pryse Works . . 0733 

Lockport Worlds . 0630 

Casper Works . 0588 

Craig Works • 0621 

Cody Works . 0724 

CALIFORNIA PETROLEUM eORPORATION (UTAH) 

[Subsidiary of The Texas Corporation) 

Calpet Works $0. 0688 

INTERNATIONAi REFINING-COMPANY 

[Subsidiary of The Texas Corporation] 

Sunburt Works $0. 0525 

INDIAN REFINING COMPANY 

[Subsidiary of The Texas Corporation] 

Lawrenceville Works ' $0. 0559 

THE TEXAS COMPANY (CALIFORNIA) 

[Subsidiary of The Texas Corporation] 

Los Angeles Works $0. 0626 

Fillmore Works . 0550 

TIDB WATER ASSOCIATED OIL COMPANY 



Refinery 



Estimated Per Gallon Values of 
(Jasoline 



First 
Grade 



Second 
Grade 



Third 
Grade 



Avon Refinery (Associated, Calif.) 

Watson Refinery (Wilmington, Calif.) 

Bayonne Refinery (Bayonne, New Jersey) . 
Drumright Refinery (Drumright, OMa.)... . 

. : L_ 

(Valuations used for Inventory purposes.) 



.0846 
.0646 
.0096 
.0563 



.0471 
.0471 
.0515 
.0483 



$0. 0421 
.0421 
.0465 



Exhibit No. 1316 

Part "B" — Appendix I 

Atlantic Refining Company 

keply to question 32 op tnec questionnaire 

A summary of refining costs for the two refineries operated by the reporting 
company for the year 1938 is shown below. Regarding methods of costing, we 
know of no satisfactory method of securing the cost of gasoline and fuel oil. 
However, for inventory purposes, costs of the various products are calculated by 
the method variously known as "Sales Value Method," "Cost Allocation Method," 
etc. An explanation of the method is shown by the examples following the sum- 
mary of refining costs. 

The Atlantic Refining Company and Subsidiaries — Summary of Refining Costs — 

Year 1938 



Year 1938 

Direct Operating Costs: 

Operating Labor - 

Fuel. 

Chemicals.- 

Repairs & Maintenance 

Other Supplies and Expenses 

Total Direct Costs 

Indirect Operatine Costs: 

Refinery Overhead.. 

.Taxes 

Insurance.- 

Depreciation on Plant 

Other... ,. 

Total Indirect Costs , 

Total Operatine Costs 

Loading Expense 

Oen'l and Admin. Exp 

Total 

Crude Oil Consumed 

Puroh. Mixing Oils Consumed 

Total Refinery Costs 



Phila. Refy. 


Atreco Refy. 


$.,984,481 

2, 007, 800 

1,308,912 

1, 293. 702 

410, 686 


$276, 194 
449, 667 

44,313 
205,040 

77, 363 


8.005,681 


1,052,567 


$1,066,322 

312, 784 

38,709 

2, 059, 428 

444,226 


$147, 219 

67. 549 

7,259 

390, 536 

76, 491 


3, 921, 469 


679.057 


$11,927,050 
323. 7T() 
236, 6S3 


$1,731,624 
27,754 
51,217 


12,487,512 


■ 1, 810, 595 


40, 977, 8S3 
1, 375, 356 


9, 923. 792 
77, 042 


54, 840, 751 


11,811,429 



Per unit figures used for inventory purposes were: 



Philadelphia 
Refinery 



Atreco Re- 
finery 



Naphtha. 
Fuel on.. 



Cenfs 
5.69 
2.48 



Cents 



6. 16 
1.87 



10047 



10048 



CONOENTKATION OF ECONOMIC POWER 



OUTLINE OP THE A. R. CO. REFINERY PRODUCTION COST METHOD FOR INVENTORY 

PRICING 

Manufactured Oils. — Crude oil and manufacturing costs are spread over the 
various grades (refined, naphtha, lubricating, fuel, etc.) on the basis of their sales 
value. 

Example: 

If cost of crude is 3. 16^5 per gal. 

If cost of manu. mixing oils, etc. is 1. 06^ per gal. 

Average Cost 4. 22ji per gal. 

Sales value of our production, considering yields: 



Yields 
(1) 


% 
(2) 


Refy. 
Realiza- 
tion 

(3) 


Refy. 
Sales 
Value 

(4) 


Allocated 
Cost 

(5) 


Refined -- - 


5.44 

44.70 

20.81 

14.54 

3.39 

.72 

.88 

2.55 

6.97 


4.56«5 
5.54 
1.64 
3.02 
10.92 
14.27 
3.16 
2.45 
1.42 


.25^ 

a 48 

.34 
.44 
.37 
.10 
.03 
.06 
.10 


4.61)t 


Naphtha - 


5.61 


Fuel - 


1.66 


Gas Oil 


3.06 


Lubricating - 


11.08 


Wax --- 


14.44 


Asphalt - -- 


3.19 


OoKe 


2.48 


Non-Uqold Gas 


1.44 








100.00 




4.17 











Cost of 4.22(S per gallon is 101.20% of sales value of 4.170 as in Col. 4. Items 
in Col. 3 at 101.20% give allocated cost price. All brands of gasoline are inven- 
toried at same price. 

(Col. 2) Yields and Refinery Realization (Col. 3) are based on six months 
averages, to obviate wide variations in them during any one month. Manufac- 
tvring cost is also based on six months average for the same reason. 

Previous December 31st inventory used as base for the ensuing year. All 
JCreased gallons are priced at the average cost of the manufactured oils and 
^ JTOh&ses. (January 1st to date of inventory). 



(CONCENTRATION OF ECONOMIC POWER 

Arkansas Fuel Oil Company, 
Reply to item §32 of T. N. E. C. questir>rinaire 



10049 



Products 



Premium 

Regular 

White 

Total - 

Kerosene - 

Tractor Fuel 

Solvent 1 

QasOil 

Fuel Oil 

Still Gas Prod. (Qals.)- 

SlopOil 

Topped Residue 

Loss 



Total --- 

Less Still Gas produced and con- 
sumed 

Plus Slop Produced and consumed- 

Actual Sales Value and Mfg. 
Expense 

Cost of Crude and Mfg. Expense.. 

Sales Value of Production 

Ratio of Mfg. Cost to Sales Value 
percent.. 



MontH of December 1938 



Gallons 
produced 
from crude 



145, 753 

10, 376, 990 

2, 892, 831 

13, 415, 574 

3, 786, 349 

362, 450 

502, 762 

1, 168, 032 

6, 337, 513 

1, 289, 652 

R7770 

324, 156 

R 31, 934 



27, 146, 784 



Current month's 

refinery sales 

prices 



0. 0550 
.0434 
.0387 
.0425 
.0345 
.0401 
.0418 
.0320 
.0135 
.0123 
.0314 
.0167 



$829, 208. 26 
864,855.94 



95. 8781944 



Sales value 
of produc- 
tion 



$8, 016. 42 
450, 361. 37 
111,952.56 
570, 330. 3-5 
130, 629. 04 

14, 534. 24 
21,015.45 
37, 377. 02 
85, 556. 43 

15, 896. 66 
R 243. 98 
5,413.41 



$880, 508. 62 

15, 896. 66 
R 243. 98 



$864, 855. 94 



Apportion- 
ment of 
crude cost 
& mfg. ex- 
pense 



$7, 686. 00 

431, 798. 35 

107, 338. 09 

546, 822. 44 

125, 244. 76 

13, 935. 17 

20, 149. 23 

35, 836. 41 

82, 029. 97 

15,896.66 

R 243. 98 

6, 190. 28 



$844, 860. 94 



15, 896. 66 
R 243. 98 



$829, 208. 26 



(Note 1) 
Crude cost 
<& mfg. exp. 
per gallon 



0. 0527 
.0416 
.0371 
.0468 
.0331 
.0384 
.0401 
.0307 
.0129 
.0123 
.0314 
.0160 
.0160 



The costing policy used Is that generally known as the "Weighted-Selllng-Ratlo-Method" and Is based 
on the principle of spreading the cost of manufacture to each product in direct ratio to its selling value, on 
the theory that the same rate of gross profit is earned on each product. 

Costs of Natural Gasoline and Tetra Ethyl Lead used in blending are charged directly to the product 
involved, and do not affect the costs of other products. 

Note I.— The costs per gallon of Gasoline shown in this column do not include Natural Gasoline or Tetra 
Ethyl used in blending. This blending cost is added directly to the product affected In the following 
manner: 





Gallons 
blended 


Unit cost 
per gal. 


Cost 
amount 


PSEMnm OASOUNE 


145753 
24318 


.0527 


$7686. 00 




1283. 32 


Tetra-Ethyl Lead Added . - 




1116. 43 










Finished Cost Prem Gaso . . .. 


170071 


.0593 


$10085.75 






EEQULAE "q" QASOLINK 


10376990 
97356 


.0416 


$431798.35 




6137. 70 


Tetra-Ethyl Lead Added ... 




37066. 77 










Finished Cost Regular Gaso — .. 


10474346 


.0453 


$474002.82 






WHITE GASOLINE (V. 3. MOTOE) 

White Gaso. from Crude - 


2892831 
252714 


.0371 


$107338. 09 




13336. 29 








Finished cost White Gasoline . .- -- -- 


3145545 


.0384 


$120674. 38 






FUEL OIL 

Fuel Oil from Crude (Finished) 


6337513 


.0129 


$82029.97 







10050 



CONCENTRATION OF tlCONOMIC POWER 



Cities Service Oil Company (Pa.) 

Reply to Item No. 32 of T. N. E. C. Questionaire 
Answer: 

COST PROCEDURE FOR REFINERY YIELDS 

The actual yields derived from the crude run for the month are priced on a 
wholesale price basis, that is, on a price which is presumed could have been 
realized had I'ue products yielded been sold on the wholesale market. After 
the prices have been determined, the estimated sales realization is calculated 
by multiplying the yield by the prices. All gasoline produced is priced on the 
basis of 60-64 octane unleaded gasoline and the cost of bringing the quality of 
this gasoline up to regular and premium grades is applied directly against the cost 
of the gasoline ultimately produced. 
All the following expenses, 

Plant Operation Labor 

Sundry Supplies 

Chemicals 

Royalty 

Electricity 

Plant Maintenance Labor 

Plant Maintenance Material 

Operating Office Overhead 

Fuel 

Taxes 

Insurance 

Depreciation 
plus the cost of the crude less ethelizing expense and fuel consumed is apportioned 
on the basis of the percentage determined by dividing the cost of crude and 
expenses by the estimated sales realization less cost of fuel consumed. 

Ethylizing expense is applied directly against the regular and premium gasoline 
in accordance with the actual expense incurred in blending such gasolines during 
the month. 

Summary cost statements for each of the following refineries foUow herewith. 

Petty's Island 

Titusville 

Warners 

East Braintree 

Summary cost statement — Petty's Island — 1938 





Oallons 
Yielded 


Average 
Sales 
Price 


Sales 
Amount 


Crude 

Equivalent 

Average 

Cost 


Cost 
Amount 


Gasolene 


80, 966, 128 
12, 997, 009 
12, 730, 741 
690,088 
4, 381, 394 
6, 309, 001 
37,311,504 
19,626,666 


$0.0637 
.0501 
.0454 
.0482 
.0446 
.0328 
.0244 
.0125 


$5, 155, 217. 26 
651,011.94 
986, 704. 59 
33, 233. 95 
195. 519. 33 
206.690.33 
912, 061. 55 
244, 500. 25 


$0. 0591 
.0465 
.0421 
.0447 
.0414 
.0304 
.0226 
.0125 


$4, 782, 965. 64 


Kerosene 


604, 003. 19 


#2 Fuel Oil 


915, 455. 90 


#3 Fuel OU 


30, 834. 17 


U Fuel Oil 


181, 401. 13 


#5 Fuel Oil 


191, 765. 48 


#e Fuel Oil 

Fuel Used 


846, 202. 74 
244, 500. 25 






Total-.. 






8, 384, 939. 20 




$7, 797, 128. 40 













Crude, 4,167,447 bbls $6,688,664.94 

Expenses: 

Plant Operation Labor 260,401.22 

Sundry Supplies & Expenses _ 39,813.77 

Chemicals 181,582.83 

Royalty 78,79L92 

Electricity... 56,486.61 

Fuel- 1 244,500.26 

Plant Maintenance Labor 54,089.70 

Plant Maintenance Material.-. 64,368.40 

Operating Office Overhead 9, 167. 73 

Taxes 31,063.27 

Insurance • 19,764.44 

Depreciation.- 226,216.00 

Other Direct Overhead 774.00 



CONCENTRATION OF ECONOMIC POWER 



10051 



Summary cost statement — Petty' s Island — 1938 — Continued 

Method of Calculating Ratio: 

Crude Cost - $6,688,504.94 

Expenses - $1,246,020.04 

Less Ethylizing Expense 136,456.58 

Less Fuel used 244,500.25 

Net Expense 846,063.21 

Total Crude* Expense - $7,552,628.16 

Sales $8,384,939.20 

Less Fuel Consumed 244,500.26 

Net Sales $8,140,438.96 

R^"°-|ltiSS=-»27791264 

Summary cost statement — East Braintree — 1938 





Gallons 
Yielded 


Average 
Sales 
Price 


Sales Amount 


Crude 
Equiva- 
lent 
Average 

Cost 


Cost 
Amount 


Gasolene 


97, 837, 218 

758, 846 

16, 858, 358 

2, 569, 541 
42, 044, 744 

6,157,907 

2, 225, 771 
14, 138, 774 

9, 025, 465 
37, 714, 191 

2, 488, 325 
13, 567, 475 


$. 0637 
.0350 
.0530 
.0454 
.0450 
.0456 
.0352 
.0274 
.0321 
.0243 
.0849 
.0238 


$6, 234, 843. 20 

26, 559. 62 

894, 048. 10 

116, 670. 71 

1, 890, 044. 05 

281,007.16 

78, 428. 54 

387,070.29 

289,688.95 

918, 142. 83 

211, 222. 51 

322, 804. 31 


$.0610 
.0335 
.0508 
.0435 
.0431 
.0437 
.0337 
.0263 
.0308 
.0233 
.0814 
.0228 


$5, 974, 749. 82 


Propane 


25, 451. 66 


Kerosene. . 


866, 751. 90 


Qas Oil.. 


111,803.66 


#2 Fuel Oil 


1, 811, 198. 78 


#3 Fuel Oil 


269, 284. 64 


#4 Fuel Oil !...» 


75, 156. 81 


#5 Fuel Oil 


370, 923. 23 


Gas Enrichment 


277,604.26 


#6 Fuel Oil.:.-. 


879,841.49 


Lube Oils 


202,4n. 13 


Fuel Used 


322,804.31 






Total. 






$11,650,530.27 




$11, 177, 981. 69 













Crude, 5,859,370 barrels. 



9,615,983.94 



Expenses: 

Plant Operation Labor 

Sundry Supplies & Expense. . 

Chemicals 

Royalty 

Electricity 

Fuel 

Plant Maintenance Labor 

Plant Maintenance Material. 
Operating Office Overhead... 

Taxes 

Insurance 

Depreciation 

Processing Tax 



350,971.36 

57,571.72 

259,683.98 

89,261.36 

74,962.83 

322,804.31 

123,203.81 

69,378.06 

_ 8,515.03 

97,760.68 

28,315.18 

285,652.00 

1,066.00 

Total Expanses _ $1,768,746.23 



Method of Calculating Ratio 

Crude Cost $9,615,983.94 

Gross Expenses.. $1,768,746.23 

Less Ethylizing Expense _. 207,748.48 

Less Fuel Used ._ 322,804.31 




11.327.72.'i.9fi 



124'f91— 40— pt, 17-A- 



10052 CONCENTRATION OF ECONOMIC POWER 

Summary cost statement, Titusville, 1938 



Gasolene 

Kerosene 

Fuel— 36/40.. 
Lub. Stocks. 
Fuel Used... 
Naphtha 



Total. 



Galons 
Yielded 



10,011,589 
fi, 293, 766 
7,751,431 
8, 772, 767 
1. 709, 958 
749, 587 



A verage 
Sales 
Price 



. 0483 
.0492 
.0400 
.1283 
.0400 
.0517 



Sales Amount 



$483, 283. 71 

309, 791. 27 

310, 106. 74 

1, 125, 950. 75 

68, 323. 90 

38, 757. 46 



$2, 336, 213. 83 



Crude 
Equiva- 
lent Aver- 
age Cost 



.0463 
.0472 
.0384 
.1230 
.0384 
.0496 



Cost Arnounr, 



$463, 438. 02 
297,069.89 
297, 372. 43 
1, 079, 714. 43 
68, 323. 90 
37, 165. 91 



$2, 243, 084. 58 



Crude, 866,429 barrel^ $1,811, 137. 93 



Expenses : 

Plant Operation Labor 

Sundry Supplies & Expenses. 

Chemicals 

Electricity 

Fuel 

Plant Maintenance Labor 

Plant Maintenance Material. 

Operating Office Overhead 

Taxes 

Insurance 

Depreciation 

Other Gen. Off. Overhead. __ 



Total. 



109, 579. 68 
25, 892. 64 
92, 925. 31 
17, 080. 08 

116,338. S 

7, 693. Vci 
9, 527. 71 

10, 804. 48 
5, 305. 37 

8, 234. 76 
87, 924. 00 

1, 430. 10 

$492, 736. 34 



Method of Calculating Ratio 

Crude Cost $1,811, 137. 93 

Gross Expenses $492, 736. 34 

Less Ethylizing Expense 60, 789. 69 

Less Fuel Used 68, 323. 90 



Net Expenses. 



363, e22. 75 



Total Crude & Expenses - $2, 174, 760. 68 



Sales $2,336,213.83 

Less Fuel Consumed 68, 323. 90 



Net Sales . $2, 267, 889. 93 

T3 .. $2,174.760.6 8 cxk^coktot 
^^*^° = ' 2,267,889.9 3= 958935727 

Summary cost statement — Warners 1938 





Gallon.<» 
Yielded 


Average 
Sales 
Price 


Sales 
Amount 


Crude 
Equiva- 
lent 
Average 
Cost 


Cost 
Amount 


Gasolene .-. . . .. 


18,719,353 
1, 278, 544 
22, 767, 899 
14, 242, 538 
16, 274, 782 
6, 562, 714 
43, 663, 557 
9,619,553 


$.0600 
.0566 
.0427 
. 0405 
.0295 
.0303 
.0538 
.0205 


$1,122,881.61 
72,403.06 
973,131.81 
576,911.83 
480, 363. 31 
198, 848. 32 
2, 347, 151. 17 
197, 132. 74 


$. 0537 
.0506 
.0382 
.0.362 
.0264 
.0271 
.0481 
.0205 


$1,004,702.60 


Red Heat Fuel... __ 


64, 782. 91 


#2 Fuel . 


870, 713. 40 


#4 Fuel 


516, 194. 06 


#5 Fuel 


429, 806. 90 


#6 Fuel-.. 


177, 920. 29 


Asphalt Prods 


2, 100, 122. 48 


Fuel Used 


197, 132. 74 






Total - -. 






$6,968,823.85 




$5, 361, 375. 38 













CONCENTRATION OF ECONOMIC POWER 10053 

Summary cost statement — Warners 19S8 — Continued 

Crude, 3,232,563 barrels $4,527,296.32 

Erpenses: 

Plant Operation Labor $274,769.38 

Sundry Supplies* Expense 30,557.47 

Chemicals - --- 60,056.22 

Electricity - --- - 18,959.81 

Fuel. - - 197,132.74 

Plant Maintenance Labor 70,226.37 

Plant Maintenance Material 68,260.68 

Operating Ofiace Overhead -. 2,831.47 

Taxes. 47,986.04 

Insurance _ 32,188.72 

Depreciation.... - 138,936.00 

Other General Office Overhead 1,376. 13 

Total - - - - $943,270.03 

Method of Calculating Ratio 

Crude Cost 4,527,296.32 

Gross Expenses $943,270.03 

Less Ethylizing Expense 109,190.97 

Less Fuel Used... j 197, 132. 74 

Net Expense.-.^. -. 636,946.32 

Total Crude & Expense $5,164,242.64 

Sales - $5,968,823.85 

Less Fuel Consumed 197,132.74 

Net Sales $5,771,691.11 

„ ^. $5,164,242.64 e«.,coo,r 
R^*'°'=|5^77L690I--»^753815 



Empire Gas & Fuel Company 
reply to item 32 op t. n. e. c. questionnaire 

a. None operated by the reporting company. 

b. During the year 1938 the Cities Service Oil Company (Delaware)' operated 
refineries at 

East Chicago, Indiana. 

Ponca City, Oklahoma. 

Okmulgee, Oklahoma. 
Principal elements of cost determining the cost of a gallon of gasoline were as 
follows : 

GASOLINE COSTS IN CENTS PER GALLON, 1938 



Elements of Cost 



Cost of Crude Run 

Ethylizing Expense 

Depreciation, Ins. & Taxes 

Plant Operation & Maintenance. 
Natural Qascline Purchased 



Total Cost- 



East 
Chicago 



$0. 0479 
.0029 
.0030 
.0070 
.0001 



$0.0609 



Ponra City 



$0. 0371 

.0021 

.0043 

.0116 

RO. 0024 



$0. 0527 



Okmulgee 



$0. 0398 
.0025 
.0068 
. 0138 

R0.0037 



$0. 0582 



FUEL OIL COSTS IN CENTS PER GALLON, 1938 




Cost of Crude Run . 


$0. 0240 
.0015 
.0035 


$0. 0140 
.0016 
.0044 


$0. 0149 
0022 


Depreciation, Ins. ^ Taxes. 


Plant Operation & Maintenance 


0052 






Total Cost 


$0 0290 


$0.0200 


$0.0223 







The method of apportioning costs used in our accounting is known as the yield 
value method. The costs being apportioned to the individual products on the 
percentage that the production of each product extended at market value bears 
to the total market value of all production each month. 

The opening inventory and the current production are averaged in arriving-; 
at the cost of products sold. 

Costs include all direct plant operation and maintenance expense, plant de- 
preciation and direct insurance and taxes. 

' No other subsidiary of Empire Gas & Fuel Co refineries. 



10054 



CONCENTRATION OF ECONOMIC POWER 



This expense, together with the cost of crude oil and transportation expense, is 
apportioned to individual products as outlined above. Crude oil is transferred 
to the refinery at market on the day delivered and transportation expense is based 
on published tariffs. 

Any purchases of natural gasoline and other refined products are charged 
direct to the proper inventory account at the purchase price including freight. 



Consolidated Oil Corporation 
supplementary reply to item #32 of tnec questionnaire 

In its original answer to Question #32 the reporting company did not undertake 
to specify the actual cost for the year 1938 at each of its domestic refineries of a 
gallon of gasoline and a gallon of fuel oil, for the reason that accurately informative 
data are not available. As explained in such original answer, the allocation of 
costs to an individual product or grade of an individual product is made on a 
purely arbitrary basis. Such arbitrary cost allocation is designed solely to serve 
the purpose of accounting convenience and does not result, of necessity, in deter- 
mining what might be deemed to represent the true cost of an individual product 
or grade. 

The arbitrarily allocated costs for the year 1938 of a gallon of gasoline and a 
gallon of fuel oil at each refinery are shown in the following tabulation. Indicated 
costs of the two products are, of course, affected materially by the varying quan- 
tities of tlie various grades of such products. 



Location of Refinery 




Fuel Oil 

(All 

Grades) 

Cents per 

gallon 



East Chicago, Ind... .-. 

Kansas City, Kans 

Coffeyville, Kans 

Sand Springs, Okla 

Parco, Wyo-- 

Fort Worth, Tex 

Houston, Tex. (Light Oil Plant) 

Marcus Hook, Pa 

Wellsville, N. Y --.. 



3.30 
3.06 
2.39 
2.41 
2.15 
1.60 
2.36 
3.40 
3.31 



The foregoing arbitrary costs are based upon the purchase (by the subsidiary 
owning and operating the above indicated refineries) of crude oil at posted market 
prices, plus (in ifiost instances) a handling charge and plus transportation charges 
at tariff rates. Refinery operating expenses comprise the items indicated in the 
footnote to the tabulation which appeared in the original answer to question 32. 

Answer: Following is a summary cost statement, for the year 1938, for each 
domestic refinery operated by the reporting company's wholly-owned subsidiary 
engaged in refining operations: 



~ 




Percentage of 


Percentage of 






Material Costs 


Refinery Oper- 






to Total 


ating Expense 




Summary 


Cost of Pro- 


to Total Cost 




Cost 


duction of 


of Production 






All Products 


of All Products 






Year 1938 


Year 1938. 
(See Note) 


Location of Refinery: 




Percent 


Percent 


East Chicago, Ind 


$29. 387, 600 


76.23 


23.77 


Kansas City, Kans 


6, 615, 800 

7, 662, 500 
4, 143, 200 


79.48 
66. 12 

68. 47 


20.52 


Coffeyville, Kans 


.33.88 


Sand Springs, Okla 


31.53 


Parco, Wyo 


4, 750, 300 


80,83 


19.17 


Fort Worth, Tex,. _ 


2, 423, 400 
30, 837, 500 


74.33 
85.56 


25.67 


Houston, Tex. (Light Oil Plant) 


14.45 


Marcu.s Hook, Pa 


30, 176, 000 
8, 399, 700 


86.80 
71.54 


13.20 


Wellsville, N. Y . 


28.46 







rLiel'fPtrn^h''??'^^^'"^'^^'^"^'"^ expenses included hereunder comprise operating labor and supplies, repairs, 
anddepre^^r "J'scollaneoiis opwatlng expenses, insurance, taxes (other than Social Security Taxea) 



CONCENTKATION OF ECONOMIC POWER 



10055 



The costs of the various classifications of products manufactured are deter- 
mined by the arbitrary allocation (with relatively unimportant exceptions) of 
manufacturing and raw material costs to the quantity of the various classifications 
of products produced on the basis of their estimated relative selling values. In 
view of the method of costing used, the question is answered above by giving the 
percentage cost of crude oil and other materials consumed to total cost of produc- 
tion of all products and the percentage of manufacturing expense to such total cost 
of production. Disparity in percentages between plants is largely caused by 
variance in geographical locations of the plants, the kind of crude utilized, the 
varying types of manufacturing services performed, and the proportion and 
type of products produced. 

Continental Oil Company 
reply to item 32 of t. n. e. c. questionnaire 

For the purpose of departmental accounting only the cost of gasoline is deter- 
mined by the single product method; that is, all by-products (including fuel oil 
and charging stock) derived from skimming and cracking plant operations are 
priced on the basis of the previous month's average market price, less an allow- 
ance for selling expense. The value of these by-products is then deducted from 
the total cost of raw materials (crude oil and casinghead gasoline at current 
posted prices plus transportation at tariff rates to refinery) and refinery operating 
expense (before taxes and depreciation) to determine the cost of gasoline. Market 
value used in pricing by-products is the average of quotations taken from Piatt's 
Oilgram and the Chicago Journal of Commerce. 

The cost of lubricating oils, greases and wax is the cost of raw material (charging 
stocks priced at market value as outlined above) and operating expenses (before 
taxes and depreciation) applicable thereto. 

Cost of gasoline at various refineries — 19S8 



Ponca City Kefinery... 

Baltimore Refinery 

Wichita Falls Refinery 

Glenrock Refinery 

Farmington Refinery.. 

Artesia Refinery 

Denver Refinery 

Albuquerque Refinery. 
Lewiston Refinery 



Unit Cost per Gallon 



Raw Ma- 
terials and 
Operating 
Expenses 



.0481 
.0511 
.0443 
.0487 
.0588 
.0425 
.0597 
.0617 
.0708 



Taxes and 
Deprecia- 
tion 



$0. 0016 
.0032 
.0020 
.0022 
.0008 
.0032 
.0037 
.0013 
.0011 



Total 



$0. 0407 
.0543 
. 0403 
.0509 
.0596 
.0457 
.0634 
.0630 
.0719 



Cost of raw materials and operating expenses — Fuel oil — 1938 

Unit Cost 
per Oallon 

Ponca City Refinery $0. 0166 

Baltimore Refinery ^ . 0231 

Wichita Falls Refinery . 0170 

Glenrock Refinery . 0170 

Farmington Refinery . 0083 

Artesia Refinery ^ . 0140 

Denver Refinery . 0192 

Albuquerque Refinery . 0344 

Lewiston Refinery .0252 



10056 ('ONCENTRATION OF ECONOMIC POWER 

GtJLF Oil Corporation 

REPLY TO ITEM NO. 32 OF TNEC QUESTIONNAIRE 

The costiug system in effect, applicable to muaufactured oil products, provides 
for the accumulation of all expenses, including the cost of raw materials and a 
proportion of the general administrative expenses. 

Quantities of production of each product are calculated and extended at the 
average wholesale market values for the period in question; said market values 
being obtained from reliable trade publications and the average of the low daily 
quotations over a thirty day period to the nearest equivalent of the products 
manufactured are utilized. In the absence of price quotations comparable to a 
product manufactured, arbitrary prices are used, or differentials are added to or 
subtracted from a published price to compensate for the equivalent of the product 
manufactured. The percentage relation of the total cost of manufacture to the 
combined market values is then determined, and each product is assigned as its 
cost the percentage of its market value which the total cost bears to the combined 
market value. 

Temporary National Economic Committee questionnaire — Question 32 — Summary 
cost statement of operating each domestic refinery operated by the reporting company 
or its subsidiaries or affiliates — Year 1938 

GULF OIL CORPOEATION— SUPPLEMENTAL REPLY 





Port Arthur Refinery 




Barrels 


Amount 


Avg. Cost 
Per Barrel 


Crude & Other Products Charged 


41, 741, 537 


$60, 542. 361 


$1. 450 






Labor (Operating and Repairs) 




4, 063, 311 

4, 595, 764 
2, 201, 089 

5, 297, 193 




.098 


Materials (Operating and Repairs) 


8,783 


.111 


Fuel 


.053 


Overhead ". 




.128 


Unaccounted for Oil Loss. 


1 286. 456 


.010 






Subtotal — Manufacturing Ejcpenses . . 




16, 157, 357 


.400 








Total Cost 


41, 463, 864 


76,699,718 


1.850 


Per Cent of Capacity Operated, 100%. 






Fort Worth Refinery 


Crude & Other Products Charged 


2, 057, 742 


$2, 891. 698 


$L405 






Labor (Operating and Repairs) 




132, 592 
176, 989 
136, 442 
182, 719 



.064 


Materials (Operating and Repairs) 




.085 


Fuel 




.066 


Overhead 1.. 




.088 


Unaccounted for Oil Loss 


20, 372 


1.014 






Subtotal— Manufacturing Expenses 




628, 742 


.289 








Total Cost. - 


2,078,114 


3, 520, 440 


1.694 


Per Cent of Capacity Operated, 92.9%. 






Sweetwater Refinery 


Crude & Other Products Charged 


2, 237, 614 


$2, 539, 958 


$1. 135 






Labor (Operating and Repairs) - _ _. . 




208,682 
298, 015 
174,724 
243, 442 



.096 


Materials (Operating and Repairs) 




.138 


Fuel 




.081 


Overhead 




.112 


Unaccounted for Oil Loss .. 


'68,872 


.036 






Subtotal— Manufacturing Expenses 




924,863 


.463 








Total Cost 


2, 168, 742 


3, 464, 821 


1.598 


Per Cent of Capacity Operated. 118.6%. 





• Red figure. 



(lONCENTHATION OF ECONOMIC POWER 



10057 



Temporary National Economic Committee questionnaire — Question 32-^ — Summary 
cost statement of operating each domestic refinery operated by the reporting company 
or Us svhsidiaries or affiliates — Year 1938 — Continued 

GULF OIL CORPORATION— SUPPLEMENTAL REPLY— Continued 





New York Refinery 




Barrels 


Amount 


Avg. Cost 
Per Barrel 




3,167,930 


$2, 948, 091 


$0,931 










70,543 
42,720 
61,862 
125,923 



.022 






.014 


Fuel 




.019 


Overhead . - - 




.040 


Unaccounted for Oil Loss . . 


111,837 


.003 






Subtotal — Manufacturing Expenses . . 




301, 048 


.098 








Total Cost.. - 

Per Cent of Capacity Operated, 61.99%. 


3, 156, 093 


3, 249, 139 


1.029 




Philadelphia Refinery 


Crude & Other Products Charged -- -- 


12,282,857 


$16,857,174 


$1. 373 










830, 468 
1, 125, 669 

947,211 

1,330,820 




.068 


Materials (Operating and Repairs) . 




.092 


Fuel 




.078 






.109 




184,162 


.010 






Subtotal — Manufacturing Expenses 




4,234,168 


.357 




■ 




Total Cost 


12, 198, 695 


21, 101, 342 


1.730 


Per Cent of Capacity Operated, 102.6%. 






Pittsburgh Refinery 


Crude & Other Products Charged 


3,846,836 


$7, 739, 374 


$2. 012 






Labor (Operating and Repairs) 




349, 548 
574 942 
40c>, 448 
466,454 



.091 


Materials (Operating and Repairs) - 


401 


.150 


Fuel . 


.105 






.121 


Unaccounted for Oil Loss» - - . - 


1 12, 677 


.007 










1, 794, 392 


.474 








TdJ^l Cost 


3,834,560 


9, 633, 766 


2.486 


Per Cent of Capacity Operated, 104.5%. 






Toledo Refinery 


Crude & Other Products Charged 


6, 228, 552 


$11, 412, 041 


$1,832 


LbTjor (Operating and Repairs) 




445, 156 
689, 265 
381, 716 
779, 273 



.071 






.110 


Fuel ... 




.061 


Overhead 




.125 


Unaccounted for Oil Loss ~ - 


7,155 


1.001 






Subtotal — Manufacturing Expenses 




2, 295, 410 


.366 








Total Cost-. 


6, 235, 707 


13, 707, 451 


2.198 


Per Cent of Capacity Operated, 94.8%. 






Cincinnati Refln 


Jry 


Cru(Je & Other Products Charged. . 


6, 759, 491 


$12, 318, 282 


$1. 822 






Labor (Operating arid Repairs) .. ... 




492, 607 
740, 440 
428, 442 
791, 042 



.073 


Materials (Operating and Repairs) 




.luy 


Fuel 




.063 


Overhead-- . ... 




.117 


Unaccounted for Oil Loss . - 


8,267 


1.002 






Subtotal — Manufacturing Expenses ... . . 




2,452,531 


.360 








Total Cost. . . . 


6, 767, 758 


14,770,>^"3 


2.182 


Per Cent of Capacity Operated, 102.9%. 





1 Red figure. 

NCTE.— It is impractical to deteruiiue the actual per unit cuiit uf a gallon of Qasojino and Fuel Oil, sepa- 
rately, at the refinery gate. 



10058 (,'()N<;entiiati()n oi' kcono.mic power 

The Ohio Oil Company 
rkplt to item #32 of t. n. e. c. qt) estionnaihe 

Summary cost statement 
LOVELL. WVOMING REFINERY, 1938 







Gasoline cost 


Fuel oil cost 


Raw Material: 

f'rude Oil 




3S, 104. 81 
8, 912. 90 


124,361.95 


Natural Gasoline __ ... 










Total Raw Material 


47,017.71 


124, 361. 95 








Operating Expense: 

Labor. __ 


3. 300. 11 

1,622.29 

327. 19 

2, 804. 13 
1, 567. 94 

3, 892. 34 


10, 770. 52 


Repairs 


6, 294. 66 


Chemicals _ 


1, 067. 84 


Fuel (Natural Gas)... 


9, 151. 77 


Other. . _. _ 


5, 117. 23 


General _. _. . 


12, 703. 35 








Total Operatina; Expense. 


13,514.00 
6, 775. 30 


44, 105. 37 


Depreciation .: __ 


22, 112. 42 








Total Cost. 


67, 307. 01 

1, OUO, 193 

0.06729402 


190, 579. 74 


Production in Gallons (Gasoline 
Cost per Gallon 


includes Natural Gasoline blended) 


10, 350, 762 
0.01S41216 









FT. WORTH, TEXAS REFINERY, 1938 



Raw Material: 

Crude Oil.... 

Natural Gasoline... 
"Q" Liquid (Load). 



Total Raw Material. 



Operating Expense: 

Labor.. 

Repairs 

Chemicals 

Fuel— Natl. Gas & Fuel Oil. 

Other 

General 



Total Operating Expense. 

Depreciation 

Amortization of Royalty on KelloKlJnlt 

Total Cost 

Production in Gallons (Gasoline includes Natural Gasoline blended). 
Cost per Gallon 



901, 194. 09 
118, 602. 88 
28, 813. 75 



1, 048, 610. 72 



86,432.88 
63, 745. 83 
59, 903. 70 
48, 567. 11 
27, 963. 38 
45,518.56 



332, 131. 46 
37, 443. 7V 
4, 963. 01 



1,423,148.96 
26, 519. 808 
0. 05366362 



BRISTOW, OKLAHOMA REFINERY, 1938 



Raw Material: 

Crude Oil 

Natural (Sasoline... 
"Q" Liquid (Lead). 



Total Raw Material. 



Operating Expense: 

Labor 

Rppairs. 

•^heraicals.. .. 

' Fuel (Natl. Gas & Fuel OU). 

Other , 

General 



Total Operating Expense... _ 

Depreciatiou 

Amortization of Royalty on Kellogg Unit 

Total Cost 

Production in Gallons (Gasoline includes Natural Gasoline blended), 
(/"ost per Gallon 



840,711.39 
26, 314. 66 
33, 626. 56 



900, 652. 61 



48, 699. 22 
38,871.74 
12, 712. 36 
12, 115. 13 
14, 810. 61 
37, 933. 22 



165, 142. 28 

30, 274. 47 

7, 134. 15 



1, 103, 203. 51 
20,612,424 
0. 05362129 



CONCENTHAT'ION Ot^^ ECONOMIC POWER 
Summary cost statement — Continued 

ROBINSON, ILLINOIS REFINERY, 1938 



10059 





Gasoline cost 


Fuel oil cost 


Raw Material: 

Crude Oil . .- - -- 


3, 740, 877. 07 
642, 390. 76 
241,417.45 


264,841.81 






"Q" Liquid (Lead) - -- -- -- 












4, 624, 685. 28 


264, 841. 81 








Operating Expense: 


202, 207. 87 
105, 822. 09 

47, 368. 59 
204, 350. 54 

88, 149. 83 
108, 059. 14 


14, 315. 65 


Repairs - -- 


7, 491. 86 




3, 353. 54 


Fuel (Natl Gas, Coal, 


& Fuel Oil) 


14, 4R7. 35 


Other 




6, 240. 71 


General . - 


7, 650. 23 








Total Operating Exj 


755, 958. 06 
47, 278. 09 


53, 519. 34 




2, 563. 13 








Total Cost 


5,427,921.43 
91, 509, 368 
0.05931547 


320,924 28 


Production in Gallons (Gasoline includes Natural Gasoline blended) - 


16, 374, 066 
0. 0195995f 







b. No refineries operated by subsidiaries or affiliates. 

Note. — The costing method used by The Ohio Oil Company to prorate the 
elements of costs of the refining operations among the various products produced 
is one known in the industry as the "Joint-Product Method." A brief summary 
of the method is as follows : 

(1) We determine the market value of a barrel of crude petroleum pro- 
cessed, by evaluating the ultimate yield from a barrel of crude on our market 
experience. This evaluation is converted to a "per gallon" basis, called 
realization per gallon. 

(2) We determine the cost of one gallon of production by dividing the total 
of all co^t elements by the total production in gallons. 

(3) The percentage relationship that "Cost per gallon" (Item 2) bears to 
"Realization per Gallon" (Item 1) is then determined. 

(4) The percentage factor (Item 3) is then applied to the net realized price 
per gallon of each manufactured product, thus arriving at a cost for each 
product. 



Phillips Petroleum Company 
reply to item #32 of t, n. e. c. questionnaire 

All refineries are operated by the reporting company. The "By-Product" 
method is used to allocate manufacturing costs to refined products produced, such 
method being briefly described as follows: 

Expenses consisting of operating expense, general expense, both direct and 
indirect, and capital extinguishments are charged to individual processing and 
service units by classifications of expense. Each service unit is then cleared in 
total to separate processing units so that the final charge to each such processing 
unit consists of direct expenses and pro-rated service expenses. These amounts 
together with crude oil and other raw stocks consumed, at posted prices plus 
transportation tariffs, are grouped according to major operations such as crude 
skimming and cracking, lubricating oil manufacturing, and compounding. The 
totgl costs charged to each group of processing units is reduced by the market 
value of by-products produced, leaving the residue of such cost to be applied to 
the main product. 

As to the crude skimming and cracking group, gasoline is considered the main 
product and the by-products, such as kerosene, naphtha, gas oil, fuel oil, etc., are 
credited to such operations, ordinarily, at market prices. Steam refined stock is 
transferred to the lube oil manufacturing department at its gasoline replacement 
value. 



10060 



-CONCENTRATION OF ECONOMIC POWER 



The required summary cost statement for gasoline follows (under our costing 
policy explained above we do not develop a cost per gallon for fuel oil) . 





Borger 


Okmulgee 


Kansas City 




Barrels Amount 


Barrels 


Amount 


Barrels 


Amount 


Production: 


6,382,430 $12,246,984.87 


893, 397 
753, 072 
132, 593 


$2, 115, 849. 13 
I 881, 845. 44 


3, 571, 837 

1,489,252 

624,780 


$8, 980, 438. 14 


By-Products 


1, 795, 259 
2, 448, 504 


1, 285, 921. 70 


1, 485. 818. 53 
















10, 626, 193 


13, 532, 906. 57 


1, 779, 062 


2, 997, 694. 57 


5,685,869 


10, 466, 256. 67 


Cost and Expenses: 




906,300.39 
328,471.15 
947,827.97 

573, 408. 89 
31,505.04 ■ 
90. 022. 81 

431, 246. 78 

626, 025. 27 




449, 690. 66 
144, 495. 14 
252, 018. 85 

71, 106. 11 




755, 584. 77 


Utilities 








67, 730. 88 










398, 734. 71 


Repairs and other sup- 








267,420.11 










20, 000. 04 








19,498.46 
133, 804. 77 
197, 132. 60 




15, 876. 33 


AdminJstrati'.o and 








252, 886. 20 


Capital extinguish- 




-_ . 




315, 399. 23 












Total 




3,934,808.30 




1, 267, 746. 59 
649, 741. 85 




2, 093, 632. 27 


Less: Amounts allo- 
cated to lube oil man- 
ufacturing and com- 
pounding at Okmul- 










and compounding at 










18,396.06 




















3, 934, 808. 30 
9,598,098.27 




a 618, 004. 74 
2, 379, 689. 83 




'2,075,236.21 










8,391,020.46 










Total posts 




13, 532, 906. 57 
1, 285, 921. 70 




2, 997, 694. 57 
1881,845.44 




10,466,256.67 


Less: Value of by-prod- 






1»485, 818. 53 












Cost of gasoline — total. 




12,246,984.87 




2, 115, 849. 13 




8, 980, 438. 14 










Cost of gasoline— per 




0.04569 




0.05639 




0.05986 













I Okmulgee by-products: 

Steam refined stock (at gasoline replacement value) $354,627.14 

Other— Skimming and cracking by-products (at market value) 527,218.30 

881, 845. 44 

' Expenses are recorded by classifications to processing and s^-vioe units, the latter being separately allo- 
cated in total to processing units of skimming, cracking, lube manufacturing and compounding. Therefore, 
the identity of each classification of expense is lost and it is impracticable to determine the amount of each 
classification finally allocated to gasoline manufacturing. 

3 Expenses are recorded by cJassifications to processing and service units, the latter being separately 
allocated in total to processing units of skimming, cracking and compounding. Therefore, the identity of 
each classification of expense is lost and it is impracticable to determine the amount of each classification 
finally allocated to gasoline manufacturing. 



The Pure Oil Company 



REPLY TO ITEM #32 OF TNEC QTJESTIONNAIKE 

The cost of gasoline for statistical purposes is arrived at by the by-product 
basis, the principle of which is as follows: 

The realized sales value of finished products, other than gasohne, is subtracted 
from the total of the cost of crude oil, transportation and processing. The re- 
maining sum represents the cost of gasoline and that sum is divided by the 
gasoline production for the month to arrive at the cost to produce a gallon of 
gasoline. 

This method of determining cost does not permit segregation of the cost of 
fuel oil. 



CONIJENTRATION UF ECONOMIC POWER 

Summary of cost statement — year 1938 



10061 





Cabin 
Creek 
West 
Virginia 
Refin- 
ery 


Heath 
Ohio 

Refin- 
ery 


Musko- 
gee 
Okla- 
homa 
Refin- 
ery' 


Smiths 
Bluff 
Texas 
Refin- 
ery 


Toledo 
Ohio 

Refin- 
ery' 


Mid- 
land 

Michi- 
gan 

Refin- 
ery 


Per bbl. of crude— Cost: 

Field Price . _.- - 


$1.44 
.35 


$1.29 
.37 


$1.19 
.19 


$1. 22 
.18 


$1.21 
.33 


$1.09 


Transportation . . 


.15 






Delivered -- 


$1.79 
.83 


$1.66 
.39 


$1.38 
.61 


$1.40 
.26 


$1.54 
.49 


$1.24 


Processing cost— Including Depreciation.. 


.25 


Total Cost of Production . . 


$2.62 
1.18 


$2.05 
.31 


$1.99 
.33 


$1.66 
.44 


$2.03 
.35 


$1.49 


Less: Value of all products other than gasoline.. 


.94 


Cost of Gasoline 


$L44 


$1.74 


$1.66 


$1.22 


$1.68 


$.55 






Per Gallon Cost of Gasoline 


$.06683 


$. 06709 


$. 07300 


$. 05634 


$.07200 


$. 04927 







1 Plant operated only part of 1938. Operations suspended January 20, 1939. 
' Plant closed down during part of 1938. 



Shell Union Oil Corporation 
reply to item #32 op t. n. e. c. questionnaire 

Item 32. — Summary cost statement for each domestic refinery operated (a) by 
the reporting company, or (b) by its subsidiaries or aflSUates, for the year 1938, 
showing the principal elements of cost determining the cost of a gallon of gasoline 
and fuel oil (separately), at the refinery gate (exclusive of any selling expenses). 
Explain briefly the costing policy followed with particular reference to the method 
of proration of the elements of costs of the refining operations among the various 
products produced. 

It is a recognized principle in the oil industry that it is impossible to determine 
separately the costs applicable to a particular product manufactured. The costs 
of manufacturing finished products are joint and inseparable and the products 
themselves are commingled and blended before, during and after the refining 
jjrocess. The reporting company's subsidiary refining companies do not even, 
in all cases, keep the elements of cost segregated by individual refineries. In an 
endeavor to give information which may be useful in connection with this question, 
the following information is attached, viz. the total expense up to the refinery 
gate, the additional selling, administrative and other expense, and the segregation, 
by volume, of products sold during 1938. 

Shell Union Oil Corporation and subsidiary companies consolidated statement of 
income and expenses for the year 1938 

Producing, transportation and refining op- 
erating expenses: 
Oil- field operations: 

Crude oil production costs $12, 837, 095. 91 

Exploration expense, etc 6, 381, 026. 05 

Depletion, depreciation, etc 23, 474, 385. 53 

42, 692, 507. 49 

Natural gasoline plants: 

Operating costs 1, 101, 405. 06 

Depreciation, etc ....... 223, 978. 73 

1, 325, 383. 79 



10062 CONCENTRATION OF ECONOMIC POWER 

Shell Union Oil Corporation and subsidiary companies consolidated staiemenl. of 
income and expenses for the year 1938 — Continued 

Producing, transportation and refining op- 
erating expenses — Continued. 
Transportation — Crude Oil: 

Operating costs and maintenance. $9, 992, 033. 23 
Depreciation, etc 2, 581, 652. 26 



12, 573, 685. 49 
Purchases 69, 757, 072. 60 



Decrease in inventories.. _. 3, 811, 516. 53 



Refineries: 

Operating costs _.._.. 26, 458, 775. 40 

Depreciation, etc 7, 198, 579. 06 



33, 657, 354. 46 



Own consumption (estimated) [5, 567, 405. 57] 

Cost of products at refinery gate $158, 250, 114. 79 

Selling, general and administrative expenses: 
Marketing and distributing: 

Bulk depot, terminal and service 

station operations $40, 490, 542. 37 

Transportation 22, 306, 550. 16 

Depreciation , etc 6, 223, 273. 99 

Own consumption (estimated) [800, 000. 00) 

68, 220, 366. 52 

Increase in inventories [2, 155, 686. 39] 

Head Office and management expense. 7, 668, 209. 48 

Other general expenses 6, 513, 243. 28 

Interest on funded debt and amortiza- 
tion of discount and expense 2,661,570.36 

Provision for Federal income taxes 3, 513, 014. 07 



Selling, general and administrative expenses 86, 420, 717. 32 

. Total expenses.- 244,670,832.11 

Gross income ' (including other income and credits) 255, 989, 254. 73 

Net income for the year $11, 318, 422. 62 

1 Sales Proceeds _ $251,517,473.68 



Product: Oallons 

Gasoline 1,692,906,909 

Natural Gasoline 25,972,339 

Lubricating oils 52,460.958 

Fuel oils _. 1,568,405,812 

Crude oil .._. 579,646,798 

Other products 179,429,626 



4, 098, 822, 342 



SUPPLEMENTAL REPLY TO ITEM #32 OP TNEC QUBSTIONVAIRB — PER LETTER OK 

AUGUST 24, 1939 

You ask us to quote the unit values for gasoline and fuel oil as shown in inven- 
tories at end of 1937 and 1938 for Federal income tax purposes. 

In our original response we pointed out the impossibility of determining sepa- 
rately the costs of the various products derived from a barrel of crude oil, and 
some of the reasons therefor were indicated. We are still entirely convinced that 
methods of estimation whether used for inventory pricing or other internal pur- 
pose can provide no reliable objective standard for use in a price survey. 



CONCENTRATION OF ECONOMIC POWER 



10063 



The choice of a given set of principles is justified for tax as well as accounting 
purposes so Ions as they are consistently followed year after year. Where impor- 
tant items are disregarded in arriving at cost they are nevertheless deductible 
elsewhere and subject to verification by the Revenue Agents. Such items, ex- 
cluded by some and not by others, are, for example, lease rentals, land and explor- 
ation' expense, abandonment and retirements, and research expense. 

Other practices which are waa^anted if consistently followed are the apportion- 
ment of cost by a system of weighted averages, or according to sales realization 
or by application of a by-product method, or by combinations of the?;c. Their 
use in a study of one oil company, if properly restricted, would give useful conclu- 
sions in comparing the financial statements for different periods, but such could 
and probably would result in fallacious conclusions as applied to a group of com- 
panies or in comparing one company with another. The figures are further 
rendered inadequate by variations in management practice in avoiding price 
inflation and. minimizing fluctuations resulting from the impact of price wars. 
The same may be said for the use (or otherwise) of the last-in-first-out theory 
and the pricing of inventories at cost or market, whichever lower, which injects 
a factor bearing no relation to cost and variable according to market. 

You will realize, we are sure, that the character of our response to this question 
is not dictated from any unwillingness to cooperate fully but, on the contrary, 
we would much prefer not to submit material which would itself be meaningless 
for your purpose. 



Skellt Oil Company 
rkplt to item #32 op t. n. e. c. questionnaire 

32. Summary cost statement for each domestic refinery operated (a) by the 
reporting company, or (b) by its subsidiaries or aflBliates, for the year 1938, show- 
ing the principal elements of cost determining the cost of a gallon of gasoline and 
fuel oil (separately), at the refinery gate (exclusive of any selling expenses) 
Explain briefly the costing policy followed with particular reference to the method. 
Answer : 
(a) El Dorado .(Kansas) Refinery of Reporting Company: 

Cost items — including depreciation and general overhead 



Barrels 



Amount 



Crude oil (Including Pipage) 

Operating and Maintenance: 

Superintendence 

l,abor— Operating 

Supplies 

Kuei 

Gnemicals (Including tetra-etbyl lead) 

Purchased Current...^. 

Insurance 

Taxes ■... 

Automotive 

Cleaning: 

Labor 

Supplies - 

Maintenance: 

Labor 

Materials, etc 

Sundries - 

Tank Car Rent Demurrage, etc 

Blending Stock Used (Natural Qasoline, etc.). 

Containers Used 

Depreciation on Plant and Equipment 

General and Administrative Expense ,... 



7,373,991 



389, 225 



$9,720,411.67 

25,062.03 

300,650.08 

39, 331. 63 

445,020.89 

534,038.38 

80, 598. 26 

10, 245. 46 

16, 391. 26 

13, 225. 52 

13,514.89 
7, 691. 14 

61, 685. 82 
130,343.46 

60, 147. 30 

89,623.06 
720,302.86 

15,785.63 
363, 168. 64 
113, 605. 37 



Less: 



Processing and Storage Loss. 
Miscellaneous Earnings 



7, 763, 216 
25,559 



12, 760, 842. 72 



11, 428. 30 



7,737,657 



Production and Cost : 

(Gallons) - — - 324,981,694 



12,749,414.42 



10064 



CONCENTRATION OF ECONOMIC POWER 



Cost items — including depreciation and general overhead — Continued 

Total cost above is apportioned to products in ratio to realizable value of production; therefore no 
separate cost of gasoline and fuel oil is given. The cost apportionment is as follows: 



Production 
(Gallons) 



Amount 



Gasoline 

Kerosene 

Tractor and Furnace Oil. 

Fuel Oil 

Road Oil and Asphalt 

Other Products 



190, 976, 534 
15, 098, 072 
31,451,430 
47, 565, 855 
20,964,273 
18, 925, 430 



$9, 365, 609. 75 
640, 063. 83 
1, 235, 377. 33 
702, 097. 60 
495, 276. 31 
310,989.70 



324, 981, 594 



$12, 749, 414. 42 



Gasoline— Cost per Gallon. 
Fuel Oil— Cost per Gallon. 



$.04904 
.01476 



(b) The reporting company operates only one refinery itself and operates 
none through subsidiaries or affiliates. 

Mat 24, 1939. 



Socony-Vacuum Oil Co., Incorporated 

reply to question 32 of tnec questionnaire 

It is not possible for us to answer this question for reasons explained in our 
answer to Ilk (1). 

Report of Socony-Vacuum Oil Company, Inc., temporary National Economic 
Committee, Washington, D. C. — questionnaire for oil companies — answers to 
supplemental questions contained in letter dated July 14, 1939 

[Question 32] 

INVENTOBY OF GASOLINE AND FUEL OIL 



Gallons 



Inventory 
Value 



Average 
(Per Unit) 



Magnolia: 

Gasoline 

Light Fuel OU.. 
Heavy Fuel Oil. 

General: 

Gasoline 

Light Fuel Oil.. 
Heavy Fuel Oil. 

Socony-Vacuum : 

Gasoline 

Light Fuel Oa.. 
Heavy Fuel Ofl. 

Overall Averages: 

Gasoline 

Light Fuel OU.. 
Heavy Fuel Oil 



50, 069, 922 
37, 163, 906 
164, 399, 910 

67,632,895 

71, 813, 368 

349,747,017 

263, 558, 652 
171,246,286 
90, 216, 855 

381, 261, 469 
280, 222, 560 
604,363,782 



2, 067, 810. 34 

902,626.68 

2, 462, 079. 33 

3,097,437,61 
1, 626, 737. 66 
5,163,263.67 

14,655,267.13 
5, 946, 175. 28 
1,848,758.99 

19,820,504.98 
8, 495, 439. 62 
9,464,101.99 



0.0413 

.0243 
.0149 

.0458 
.0227 
.0148 

.0666 
.0348 
.0205 

.0520 
.0303 
.0167 



C;()NCENTRATION OF ECONOMIC POWER 10005 

Standard Oil Company (Indiana) 
reply to item #32 op t. n. e. c. questionnaire 

INDEX 

Pago 

standard Oil Company (Indiana) — ...".. 

Whiting Refinery 

Wood River Refinery 

Sugar Creek Refinery...^ 

Casper Refinery .■-.... 

Neodesha Refinery 1 

Qreybull Refinery 

Pan American Petroleum & Transport Company and Subsidiary Companies .■ 

Pan American Southern Corporation and Subsidiary Companies.. 

Stanolind Oil and Gas Company 

Utah Oil Refining Company 

The answer to this question has been premised on the recognized fact that the 
actual cost of manufacturing gasoline cannot be determined. The company has 
attempted, however, to answer the question in such a way as to inform the 
Committee as best it can the method employed for the company's own account 
ing purposes. Some of the subsidiaries use other methods and these have also 
been included. The answer is submitted with the express understanding that 
it be interpreted with the foregoing limitations. 

Summary of cost statement — gasoline and naphthas. Whiting Refinery, as of 

December SI, 19S8 

Coft Per Gallon 
of Gasoline 

Cost of Crude, F. O. B. Whiting, Indiana $0. 0683 

Manufacturing expense: 

Direct and Indirect Labor $0. 0016 

Repairs . 0019 

Fuel . 0021 

Steam and Power__ . 0008 

Chemicals . 0003 

Still Cleaning Expense . 0008 

Miscellaneous Expense 0019 

. 0094 

Overhead Expense - _. . 0028 

Depreciation Expense . 0016 

Total Cost . $. 0721 

Less: Credit for By- Products valued on the basis of value of gasoline 
content and/or approximate "net realizable value of residuals .0176 

Balance, being cost of a gallon of gasoline and naphthas $. 0543 

The costing policy followed for this refinery in estimating the cost of gasoline 
is commonly known in the industry as the "By-Product Method." Under this 
method the estimated cost of gasoline is determined by first ascertaining the sum 
of (1) cost of the crude oil delivered to the Light Oil Department, plus (2) the 
cost of processing the crude oil, plus (3) the pro rata share of general refinery 
overhead and depreciation expense. From the sum thus obtained is, deducted 
the value of all by-products (Products other than gasoline) produced jointly in 
the refining operation. The amount remaining represents the estimated cost of 
gasoline produced from the crude consumed. 

The credit taken for by-products under this method is determined by valuing 
the products commonly termfed "Residual Stocks" on the basis of their net realiz- 
able value to the refinery, and products commonly termed "Distillate Stocks" on 
the basis of their value for gasoline making purposes. 

Under this method all expenses incurred within the Light Oil Department proper 
of the refinery are allocated directly to gasoline. Expenses of a general refinery 
nature are allocated first to the Light Oil Department proper of the refinery on 
various pro rata bases such as labor, volume, investment, and time studies and 
then charged directly to gasoline. 

The cost of fuel oil is determined as follows — when by-prodiicts are utilized as 
by-products or when sold as by-products, values assigned thereto as explained in 
the foregoing are considered to be the cost of such by-products. 



10066 CONCENTRATION OF KCONOMIC POWEll- 

Summary of cost statement — gasoline and naphthas, Wood River Refinery, as of 

December SI, 19S8 

Cost Per Oallcm 
of Gasoline 

Cost of Crude, F. O. B. Wood River, Illinois ._ $0. 0528 

Manufacturing Expense: 

Direct and Indirect Labor $0. 0016 

Repairs .0022 

Fuel . .0020 

Steam and Power . . 0019 

Chemicals . 0002 

Still Cleaning Expense _-. . 0006 

Miscellaneous Expense . 0026 

.0111 

Overhead Expense . 0022 

Depreciation Expense , . 0025 

Total Cost $. 0686 

Less: Credit for By-Products valued on the basis of value of gasoline con- 
tent and/or approximate net realizable value of residuals .0154 

Balance, being cost of a gallon of gasoline and naphthas $. 0532 

The costing policy followed for this refinery in estimating the cost of gasoline 
is commonly known in the industry as the "By-Product Method." Under this 
method the estimated cost of gasoline is determined by first ascertaining the sum 
of (1) cost of the crude oil delivered to the Light Oil Department, plus (2) the 
cost of processing the crude oil, plus (3) the pro rata share of general refinery 
overhead and depreciation expense. From the sum thus obtained is deducted the 
value of all by-products (products other than gasoline) produced jointly in the 
refining operation. The amount remaining represents the estimated cost of 
gasoline produced from the crude consumed. 

The credit taken for by-products under this method is determined by valuing 
the products commonly termed "residual stocks" on the basis of their net realiz- 
able value to the refinery, and products commonly termed "distillate stocks" on 
the basis of their value for gasoline making purposes. 

Under this method all expenses incurred within the Light Oil Department proper 
of the refinery are allocated directly to gasoline. Expenses of a general refinery 
nature are allocated first to the Light Oil Department proper of the refinery on 
various pro rata bases such as labor, volume, investment, and time studies and 
then charged directly to gasoline. 

The cost of fuel oil is determined as follows — when by-products are utilized as 
by-products or when sold as by-products, values assigned thereto as explained in 
the foregoing are considered to be the cost of such by-products. 

Summary of cost statement — gasoline and naphthas. Sugar Creek Refinery, as of 

December Si, 19V8 

Cost Per Gallon 
of Oafoline 

Cost of Crude, F. O. B. Sugar Creek, Missouri $0. 0535 

Manufacturing Expense: 

Direct and Indirect Labor $0. 0018 

Repairs. __- . 0022 

Fuel . 0017 

Steam and Power . 0012 

Chemicals . 0003 

Still Cleaning Expense . 0006 

Miscellaneous Expense . 0025 

. 0103 

Overhead Expense . 0024 

Depreciation Expense . 0034 

Total Cost .0696 

T..ess: Credit for By-Products valued on the basis of value of gasoline 

content and/or approximate net realizable value of residuals . 0195 

B&lance, being cost of a gallon of gasoline and naphthas . 0501 



'JONCENTKATION 01^ ECONOMIC POWER 10067 

The costing policy following for this refinery in estimating the cost of gasoline 
is commonly known in the industry as the "By-Product Method." Under this 
method the estimated cost of gasoline is determined by first ascertaining the sum 
of (1) cost of the crude oil delivered to the I^ight Oil Department, plus (2) the 
cost of processing the crude oil, plus (3) the pro rata share of general refinery 
overhead and depreciation expense From the sum thus obtained is deducted 
the value of all by-products (Products other than gasoline) produced jointly in 
the refining operation. The amount remaining represents the estimated cost of 
gasoline produced from the crude consumed 

The credit taken for by-products under this method is determined by valuing 
the products commonly termed "residual stocks" on the basis of their net realizable 
value to the refinery, and products commonly termed "distillate stocks" on the 
basis of their value' for gasoline making purposes. 

. Under this method all expenses incurred within the Light Oil Department proper 
of the refinery are allocated directly to gasoline. Expenses of a general refinery 
nature are allocated first to the Light Oil Department proper of the refinery on 
various pro rata bases such as labor, volume, investment, and time studies and 
then charged directly to gasoline. 

The cost of fuel oil is determined .as follows — when by-products are utilized as 
by-products or when sold as by-products, values assigned thereto as explained in 
the foregoing are considered to be the cost of such by-products. 

Summary of cost statement — gasoline and naphthas, Casper Refinery, as of December 

SI, 19S8 

Cost Per Gallon 
of Gasoline 

Cost of Crude, F. O. B. Casper, Wyoming $0. 0568 

Manufacturing Expense: 

Direct and Indirect LaboB. ^^^ $0. 0016 

Repairs . 0026 

Fuel- .0020 

Steam and Power . 0022 

Chemicals .0001 

Still Cleaning Expense. __ . 0005 

Miscellaneous Expense _ . 0043 

. 0133 

Overhead Expense : -_ . 0039 

Depreciation Expense . 0131 

Total Cost .0871 

Less: Credit for By-Products valued on the basis of value of gasoline 

content and/or approximate net realizable value of residuals , .0230 

Balance, being cost of a gallon of gasoline and naphthas .. . 0641 

The costing policy followed for this refinery in estimating the cost of gasoline i 
is commonly known in the industry as the "By-Product Method." Under this 
method the estimated cost of gasoline is determined by first ascertaining the sum 
of (1) cost of the crude oil delivered to the Light Oil Department, plus (2) the 
cost of processing the crude oil, plus (3) the pro rata share of general refinery 
overhead and depreciation expense. From the sum thus obtained is deducted 
the value of all by-products (products other than gasoline) produced jointly in 
the refining operation. The amount remaining represents the estimated cost of 
gasoline produced from the crude consumed. 

The credit taken for by-products under this method is determined by valuing 
the products commonly termed "residual stocks" on the basis of their net realizable 
value to the refinery, and products commonly termed "distillate stocks" on the 
basis of their value for gasoline making purposes. 

Under this method all expenses incurred within the Light Oil Department proper 
of the refinery are allocated directly to gasoline. Expenses of a general refinery 
nature are allocated first to the Light Oil Department proper of the refinery on 
various pro rata bases such as labor, volume, investment, and time studies and 
then charged directly to gasoline. 

The cost of fuel oil is determined as follows — when by-products are utilized 
as by-products or when sold as by-products, values assigned thereto as explained 
in the foregoing are considered to be the cost of such by-products. 



124491— 40— pt. 17- A- 



10068 CONCENTRATION OF ECONOMIC POWER 

Summary of cost statement — Gasoline and naphthas, Neodesha refinery, as of December 

SI, 1938 

Cost per Oallon 
of Oaioline 

Cost of Crude, F, 0. B, Neodesha, Kansas $0. 0525 

Manufacturing Expense: 

Direct and Indirect Labor $0. 0020 

Repairs . 0020 

Fuel . 0015 

Steam and Power... . 0008 

Chemicals .0001 

Still Cleaning Expense . 0005 

Miscellaneous Expense . 0038 

. 0107 

Overhead Expense . . 0035 

Depreciation Expense, . 0045 

Total Cost $0. 0712 

Less: Credit for By-Products valued on the basis of value of gasoline 

content and/or approximate net realizable value of residuals . 015C 

Balance, being cost of a gallon of gasoline and naphtnas . $0. 0556 

The costing policy followed for this refinery in estimating the cost of gasoline 
is commonly known in the industry as the "By-Product Method". Under this 
method the estimated cost of gasoline is determined by first ascertaining the sum 
of (1) cost of the crude oil delivered to the Light Oil Department, plus (2) the 
cost of processing the crude oil, plus (3) the pro rata share of general refinery 
overhead and depreciation expense. From the sum thus obtained is deducted the 
value of all by-products (products other than gasoline) produced jointly in the 
refining operation. The amount remaining represents the estimated cost of gaso- 
line produced from the crude consumed. 

The credit taken for by-products under this method is determined by valuing 
the products commonly termed "residual stocks" on the basis of their net realiz- 
able value to the refinery, and products commonly termed "distillate stocks" on 
the basis of their value for gasoline making purposes. 

Under this method all expenses incurred within the Light Oil Department proper 

of the refinery are allocated directly to gasoline. Expenses of a general refinery 

ture are allocated first to the Light Oil Department proper of the refinery on 

ious pro rata bases as labor, volume, investment, and time studies and then 

•rged directly to gasoline. 

'^'he cost of fuel oil is determined as follows — when by-products are utilized as 
products or when sold as by-products, values assigned thereto as explained in 
foregoing are considered to be the cost of such by-products. 

Summary of cost statement— Gasoline and naphthas, Greybull refinery, as of December 

31,1938 

Cant per Oallon 
(,f Gasoline 

Cost of Crude, F. O. B. CrfeybuU, Wyoming $0. 0442 

Manufacturing Expense: 

Direct and Indirect Labor . $0. 0016 

Repairs .0007 

Fuel .0015 

Steam and Power. . . 0022 

Chemicals . 0001 

Still Cleaning Expense 

Miscellaneous Expense - ,0031 

. 0092 

Overhead Expense . 0023 

Depreciation Expense . 0042 

Total Cost $0.0599 

Less: Credit for By-Products valued on the basis of value of gasoline 
content and/or approximate net realizable value of residuals . 0099 

Balance, being cost of a gallon of gasoline and naphthas $0. 0500 



CONCENTRATION. OF ECONOMIC POWER 



10069 



The costing policy followed for this refinery in estimating the cost of gasoline 
is commonly known in the industry as the "By-Product Method". Under this 
method the estimated cost of gasoline is determined by first ascertaining the sum 
of (1) cost of the crude oil delivered to the Light Oil Department, plus (2) the 
cost of processing the crude oil, plus (3) the pro rata share of general refinery 
overhead and depreciation expense. From the sum thus obtained is deducted the 
value of all by-products (products other than gasoline) produced jointly in the 
refining operation. The amount remaining represents the estimated cost of gaso- 
line produced from the crude consumed. 

The credit taken for by-products under this method is determined by valuing 
the products commonly termed "residual stocks" on the basis of their net realiz- 
able value to the refinery, and products commonly termed "distillate stocks" on 
the basis of their value for gasoline making purposes. 

Under this method all expenses incurred within the Light Oil Department proper 
of the refinery are allocated directly to gasoline. Expenses of a general refinery 
nature are allocated first to the Light Oil Department proper of the refinery on' 
various pro rata bases such as labor, volume, investment, and time studies and 
then charged directly to gasoline. , 

The cost of fuel oil is determined as follows — when by-products are utilized as 
by-products or when sold as by-products, values assigned thereto as explained in 
the foregoing are considered to be the cost of such by-products. 

Pan American Petroletim & Transport Company and subsidiary companies 





Gallons 


Estimated Real- 
ization Value 

of Current 
Month's Pro- 
duction 


Cost of Current 
Month's Pro- 
duction 




Per 

Gallon 


Amount 


Per 
Gallon 


Amount 


Elements of Costs Determining the Costs of Products Pro- 
duced: 


X 






X 


x 








X 












X 












X 


Depreciation . 










X 














Total Combined Cost of All Products Produced from 










x(l) 














Allocation of Total Combined Cost to Products Produced on 
the Basis of Relative Estimated Realization Values Com- 
puted at average sales prices for Six Months ending with 
Current Month: 
Products Produced: 

Gasoline . 


X 

X 
X 
X 

X 




X 
X 

X 
X 
X 


X 

X 
X 

I 


X 




z 


Domestic Fuel Oil - 


X 


Heavy Fuel Oil 


X 


Asphalt . . -. . 


X 






Total Value and Cost of Products - 


X 




x(2) 




x(l) 







In order to determine the cost of each product. Total Cost (1) is prorated to the 
various products in the same ratio that the estimated realization value of each 
product bears to the Total Value (2). 

The foregoing method of costing products produced is followed uniformly for 
each refinery and is used primarily for the purpose of valuing product inventories. 
Inventory values are adjusted to market values whenever cost exceeds market 
value. 

Expenses included in Total Cost (1) consist of all expense incurred directly in 
connection with operation of the refinery such as operating labor, maintenance 
and repairs, fuel, treating chemicals, supplies, utilities, local supervision, office, 
laboratory, etc., but do not include selling and general ofi\ce administrative 
expenses. 



10070 CONCENTRATION OF ECONOMIC POWER 

Pan American Southern Corporation and subsidiary companies 





Gallons 


Estimated Real- 
ization Value 

of Current 
Month's Pro- 
duction 


Cost of Current 
Month's Pro- 
duction 




Per 

Gallon 


Amount 


Per 

Gallon 


Amount 


Elements of Costs Determining the Costs of Products Pro- 
duced: 
Cost of Grade and Grade Equivalent Consumed 


X 






X 


X 


Direct Manufacturing Expense 






X 


Manufacturing Overhead Expense - 










X 


Real Estate and Personal Property Taxes 










X 


Depreciation : 










X 














Total Combined Cost of All Products Produced from 
Grade and Crude Equivalent Consumed 










X (1) 














Allocation of Total Combined Cost to Products Produced on 
the Basis of Relative Estimated Realization Values Com- 
puted at average sales prices for Six Months endmg with Cur- 
rent Month: 
Products Produced: 

Gasoline -.. 


X 
X 
X 
X 
X 


X 
X 

"^ 

X 
X 


X 
X 
X 

X 
X 


X 
X 
X 
X 
X 


X 


Kerosene - --- 


X 


Domestic Fuel Oil 


X 


Heavy Fuel OD - 


X 


Asphalt 


X 






Total Value and Cost of Products . 


X 




x(2) 




X (1) 







In order to determine the cost of each product, Total Cost (1) is prorated to the 
various products in the same ratio that the estimated realization value of each 
product bears to the Total Value (2). 

The foregoing method of costing products produced is followed uniformly for 
each refinery and is used primarily for the purpose of valuing product inventories. 
Inventory values are adjusted to market values whenever cost exceeds market 
value: 

Expenses included in Total Cost (1) consist of all expense incurred directly in 
connection with operation of the refinery such as operating labor, maintenance and 
repairs, fuel, treating chemicals, supplies, utilities, local supervision, ofiice, labora- 
tory, etc., but do not include selling and general oflSce administrative expenses. 



Stanolind Oil and Gas Company 

un-y cost statement for Superior Refinery for the year 1938, showing the principal 
dements of cost determining the cost of a gallon of gasoline and fuel oil 

Cost of 
Qallon of 
Qasoline 

Cost of Crude Oil, F. O. B. Superior, Louisiana $0. 0398 

Manufacturing Expense: 

Direct and Indirect Labor $0. 0026 

Repairs ___ 0018 

Fuel ^ 0014 

Steam and Power . 0015 

Chemicals 0002 

Miscellaneous . 0020 

Total Manufacturing Expense .0095 

Overhead Expense 0038 

Depreciation Expense • 0026 

Total Cost . : . 0557 

I^ss: Credit for By-Products Valued on the Basis of Value of 

Gasoline Content and/or Net Realizable Value of Residuals . 0053 

Balance, Being Cost of a Gallon of Gasoline . 0504 



CONCENTRATION OF ECONOMIC POWER 10071 

The costing policy followed for this refinery in estimating the cost of gasoline is 
commonly known in the industry as the "By-Product Method". Under this 
method the estimated cost of gasoline is determined by first ascertaJTiing the sum 
of (1) the delivered cost of crude oil ccisumed, plus (2) the cost of processing the 
crude oil, plus (3) overhead and depreciation expense. From the sum thus 
obtained is deducted the value of all by-products (products other than gasoline) 
produced in the refining operation. The amount remaining represents the 
estimated cost of gasoline produced from the crude consumed. 

The credit taken for by-products under this method is determined by valuing 
the products commonly termed "Residual Stocks" on the basis of their net 
realizable value to the refinery, and products termed "Distillate Stocks" on the 
basis of their value for gasoline making purposes. 

The amount realized at the refinery for fuel oil sold is considered as the cost of 
fuel oil produced. 

Utah Oil Refining Company 
Analysis of costs 

Costs Controllable by Unit Supervision: Total amount 

102 General Process Labor— Direct 20,274. 73 

104 Stillmen 24, 127. 70 

105 Stillmen Helpers - 31, 480. 79 

106 Firemen 23,382. 19 

109 Treaters 593.86 

111 Pumpers ..- 330.48 

Total Process Labor 100, 189. 75 

125 Other than Process Labor 7,755.06 

200 Repairs— General Direct — Labor ._ 36,608.33 

200 Repairs— General Direct — Material 14,786. 69 

201 Repairs— Still— Labor 31, 79-7. 36 

201 Repairs— Still— Material 19,487.16 

Total Repairs. 102, 679. 54 

300 Steam 82, 422. 12 

Fuel: 

330 Fuel Oil -._ 58,343. 49 

334 Still Gas 98, 201. 89 

335 Purchased Gas ..- 2,226.27 

Total Fuel 158,771. 65 

Total Chemicals . 8, 579. 52 

468 Still Cleaning Expense 35,763. 16 

470 Foremen , 11,229. 05 

474 Miscellaneous Material & Supplies 5, 149. 37 

502 Handling Coke 5,457.03 

600 Electric Light and Power 21, 769. 12 

601 Water 13,810. 56 

602 Pump House Expense 3,072.54 

603 Air Compressor Expense 4,778.20 

604 Telephone Expense 118.83 

605 Vacation Expense 5, 971. 74 

Total Controllable by Unit Supervision 567, 517. 24 

Costs Controllable by Dept. Supervision: 

622 Research & Technical Service Expense 8, 536. 94 

623 Estimating & Drafting Dept. Expense 2, 604. 00 

625 Oil Inspection Expense 13, 679. 37 

627 Automobile Expense 4, 883. 86 

Total Controllable by Dept. Sapervision. __ 29, 704. 17 



10072 (X)NCBNTRATION OF ECONOMIC POWER 

Analysis of costs — Continued 

Costs Controllable by Refy. Supervision, Etc. ^ Total, amoura 

640 Refinery Supervision 1 $12, 284. 64 

643 Commissary Expense 870.15 

644 Safety, Ind. Relations & Emp. Bur. Exp :. 97.10 

645 Works Office Expense.-. 7,082.74 

647 General Works Repairs 1,541.82 

648 General Works Expense 6, 958. 89 

657 Utilities Dept. Expense 1,707.82 

Total Controllable by Refy. Supervision, Etc 30, 543. 16 

Grand Total 627,764.57 

Divisor for Above Costs: 

Total Crude Run, 103,732,348 Gal.; 0.6052 Cost per 100 gal. crude oil run. 

We do not have available for ready use Yields and Costs for the Year 1938 in 
order to show detailed elements of cost determining the cost per gallon of gasoline 
and fuel oil. However, we are showing below the average cost for the year of 
the major brands of gasoline and fuel oil: 

fjoooliTip- Average Cost 

ijasoune. PerOaU9S8 

Ethyl Gasoline $0. 0762 

Pep Gasoline ' . 0713 

Stanolind Gasoline . 0684 

Fuel Oil: Value Per Gallon $0. 0191 

Note. — The value of $0.0191 per gallon for Fuel Oil is predetermined, arid is 
based on replacement cost of natural gas in the event it becomes necessary to 
purchase our fuel. 

Method used in arriving at cost of finished products is the ratio of total cost to 
total market value — briefly stated as follows: 

(1) Total market value.- — For convenience of costing, Yields of Gasoline and 
By-Products are shown in units of 100 gallons Crude Oil consumed. Apply the 
sales value to each product manufactured and the result is market value of 100 
gallons Crude Oil consumed. 

(2) Total cost.— Total cost of processing°100 gallons Crude Oil is determined by 
adding the following: 

Cost of 100 gallons Crude Oil consumed. 

Cost of processing 100 gallons Crude in Light Oils Department as shown in 

Summary Cost Statement. 

Overhead Expenses (Less Selling Expense) /lOO gallons Crude Oil consumed. 

Depreciation Expense /lOO Crude Oil consumed. 

(3) Ratio. — Divide the total cost, the sum of (2) above b.v total market value 
as shown in (1) for the ratio of total cost to total sales, and apply this ratio to 
the sales value of each product produced for the cost of each product. 

In arriving at the value of an unfinished stock, it is first necessary to ascertain 
the amount of theoretically finished products obtainable when same is processed 
in the plant. Then apply the value to these theoretically finished products less 
the necessary finishing costs and the remainder is the value of the unfinished 
stock. 



Standard Oil Company (Kentucky) 

keply to item 32 of t. n. e. c. questionnaire 

Standard Oil Company (Kentucky) refinery was entirely closed in the eaily 
part of 1931. Therefore, we have not attempted to give you any figures for the 
2-1/4 years in which the refinery was operated only on a small scale. All gasoline 
or oils taken from our refinery during that period are included as purchases. 
During the period mentioned, all sales from our refinery were included with 
regular company sales. 



CONCENTRATION OF ECONOMIC TOWER 10078 

Standard Oil Company (New Jebsky) 

supplemental reply to item #32 of tnec questionnaire, as contained in 
information forwarded september 19, 1939 

An answer to this question is being compiled and will be submitted as soon as 
possible. 

Humble Oil & Refining Company, Subsidiary of Standard Oil Company 

(New Jersey) 

QUESTION no. 32 

Attached are Cobt Statements for all the Refineries of the Humble Oil & Re- 
fining Company for the year 1938, showing the elements of cost entering into 
product costs. Since the cost of practically all domestic crude oil to the refinery 
normally exceeds the market price of residual fuel oil, manufacturing operations 
are usually carried on for minimum production of residual fuel oil of satisfactory 
quality and consequently its cost is not determined but its value is considered 
to be the price realized for it in the open market. The refinery is credited for 
its residual fuel oil production on this basis. Thus, the "elements" which enter 
into the costs of products other than residual fuel oil are (A) cost of crude oil 
and other petroleum raw materialr and (B) the refinery processing expense ap- 
plicable to the manufacture of these products, less (C) the credit for the residual 
fuel oil production accompanying the manufacture of these distillate products. 
In the following paragraphs will be explained briefly the method of distributing 
refinery processing expense among the various operations, the fundamental basis 
underlying the costing policy and the methods of proration used in distributing 
each of the above "elements of cost" among the various product^' 

refinery processing EXPENSE 

Refinery cost records are required in sufficient detail to indicate with reasonable 
accuracy the cost of processing on each individual unit. Each refinery operation 
has an account to which is charged the direct expense — such as operating labor, 
repairs, etcetera — associated with the operation. The cost of service functions — 
such as steam, electricity, etcetera — is distributed to the processing operations 
on the basis of the amounts of utilities consumed by each. Refinery overhead 
expense is distributed among the refinery processing units on the basis of the 
direct labor, material and utilities costs — excluding plant fuel and chemicals — 
for each unit. Certain miscellaneous charges and credits not included in any of 
the above costs are incurred in the refinery. These items — such as general cor- 
porate expense, fire losses, etcetera — are of such a nature that their distrilaution 
among products must of necessity be largely arbitrary. They are distributed on 
the basis of the cost of the products before the inclusion of these miscellaneous 
items. These costs of products are obtained after applying the residual fuel oil 
debits and credits as explained below. 

COSTING POLICY 

The primary function of our overall refinery operations is considered to be the 
production of motor fuel, which is the most important product marketwise, and 
which can be obtained by processing crude oil for maximum yield of gasoline 
and minimum yield of residual fuel oil and gas. In some cases gagoline is produced 
in this manner. For this type of operation, the cost of gasoline is equal to the 
cost of crude oil, plus the manufacturing expense, less the credit for residual fuel 
oil and gas. The following table illustrates the method of calculating the cost 
of gasoline for the maximum gasoline yield type operation: 

Table I. — Cost of gasoline 

Cost of one barrel of crude oil F. O. B. refinery $1. 45 

Cost of processing one bbl. of crude oil for maximum gasoline 0. 40 

Total debits $1. 85 

Credit for 0.40 bbl. of residual fuel oil, including gas at fuel oil equivalent, 
produced from one bbl. of etude oil, when running for maximum gaso- 
line, at market value of $0.90 per barrel $0. 36 



10074 CONCl^^NTRArlON OP KrONOMlC POWER 

Table I. — Cost of gasoline — Continued 

Net cost of 0.60 bbl. of gasoline produced from one bbl. of crude oil, when 
running for maximum gasoline, excluding " Miscellaneous Refinery 
Charges & Credits", 

$ per bbl. of crude oil $1. 49 

$ per bbl. of gasoline $2. 48 

Miscellaneous Refy. Chg. & Cr. $ per bbl. of gasoline $0. 03 

Total Cost of Gasoline— $ per bbl $2. 51 

^ per gal 5. 98 

If intermediate products, such as refined oil, heating oil, etcetera, are produced 
by segregating portions of the crude stream, the potential yield of gasoline avail- 
able in these fractions must, if total gasoline production is to be held constant, 
be replaced by an equivalent volume of gasoline which can be produced by process- 
ing additional crude oil for maximum gasoline yield. Thus the petroleum frac- 
tions which compose intermediate products have a base value as potential sources 
of gasoline, the value of the potential gasoline being its cost as produced from 
crude oil by a maximum yield operation. This is the fundamental principle 
underlying our costing policy. To illustrate, suppose the cost of heating oil is 
desired. First, the maximum yield of gasoline and the yield of residual oil fuel 
and gas attainable by cracking the heating oil are determined from correlations 
based on laboratory and plant test data. In the following hypothetical example, 
it is assumed that 55 per cent of gasoline and 45 per cent of residual fuel oil and 
gas would be obtained by cracking the heating oil and that the cost of the cracking 
operation would be 45 cents per barrel. The method used in calculating the cost 
of the heating oil is as follows: 

Table II. — Cost of heating oil 

0.55 bbl. of potential gasoline x $2.48 per bbl. (See Tab. I) $1. 36 

Plus 0.45 bbl. of potential residual fuel oil and gas x $0.90 per bbl ._ 0. 41 

$1.77 
Less manufacturing expense involved in making maximum gasoline from 

heating oil . 45 

Replacement Cost of Heating Oil base stock $1. 32 

Plus cost of finishing base stock to produce marketable heating oil . 12 

Cost of heating oil exclusive of miscellaneous charges and credits — per 

barrel $1. 44 

Plus misc. refinery charges and credits — per bbl .02 

Cost of finished heating oil — $ per barrel $1. 46 

per gallon 3. 48 

After the above outlined methods of distributing {he- elements of cost have 
been applied to all products made, all the crude oil costs and processing costs for 
the refinery are fully accounted for. This procedure, if carried out in the manner 
outlined, involves considerable detailed effort if the refinery is one producing 
many different products. 

******* 

Entirely apart from the method of costing products heretofore described, and 
for the sake of simplicity in view of the large number of grades carried, inventories 
are evaluated by a special method which represents a combination of the "Crude 
Replacement Method" heretofore described, and the method known as the 
"Federal Trade Commission Method" or "Sales Value Method." A brief de- 
scription of this special method follows: 

Fuel Oil and plant produced gas are credited to the total cost of crude oil and 
other raw material at their realization or sales value, less the cost of storage, 
handling and shipping. The balance of the raw material cost is distributed 
Ratably to gasoline and all other products on the basis of the potential gasoline 
and fuel oil contents of each separate grade, multiplied respectively by the sales 
value of gasoline (less the manufacturing cost applicable to gasoline production) 
and the sales value of fuel oil (less cost of storage, handling and shipping). For 



CONCJONTUATION <»K KCUNOiMlC POWER 10075 

products other than gasoline, the potential gasoline and fuel oil content is based 
upon cracking each grade for maximum gasoline loroduction, and the yields are 
determined from correlations based upon laboratory and plant test data. Thus 
the total cost of crude and other raw material, after crediting the net sales value 
of residual fuel oil and gas, is distributed ratably to gasoline based on its sales 
value less manufacturmg expense, and to «J1 other products on the equivalent 
potential gasoline-fuel oil value of the same.' 

Since the total manufacturing expense is 'currently allocated to each operating 
unit in the refinery, the major portion of this expense can be distributed on an 
equitable basis to the various grades of products based upon the use of such 
equipment in their production, leaving only a very small amount of such expense 
on which it is necessary to use a more or less arbitrary basis. 

After having distributed the raw material and manufacturing expense to each 
grade as above described, the cost of any blending stocks, such as casinghead 
gasoline, is added to the cost of the manufactured products into which they are 
mixed, to arrive at the final cost of each grade. Such product costs are calculated 
each month and applied to inventories on a first-in, first-out basis 



1007G 



(•CONCENTRATION ()F ECONOMIC POWER 



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CONCENTRATION OP ECONOMIC POWER 10079 

OoLONiAii Beacon Oil Company 

EXPLANATION OF SUMMARY COST STATEMENT AND METHOD OF DETERMINING COST 

OF PRODUCTS 

Attached are cost statements for the Colonial Beacon Oil Company for the 
year 1938, showing the elements of cost entering into product costs. Since the 
cost of practically all domestic crude oil to the refinery normally exceeds the 
market price of residual fuel oil, manufacturing operations are usually carried 
on for minimum production of residual fuel oil of satisfactory quality and con- 
sequently its cost is not determined but its value is considered to be the price 
realized for it in the open market. The refinery is credited for its residual fuel 
oil production on this basis. Thus, the "elements" which enter into the costs 
of products other than residual fuel oil are (a) cost of crude oil and other petroleum 
raw material, and (b) the refinery processing expense applicable to the manu- 
facture of these products, less (c) the credit for the residual fuel oil production 
accompanying the manufacture of these distillate products. In the following 
paragraphs will be explained briefly the method of distributing refinery processing 
expense among the various operations, the fundamental basis underlying the 
costing policy and the methods of proration used in distributing each of the 
above "elements of cost" among the various products: 

Refinery Processing Expense. — Refinery cost records are required in sufficient 
detail to indicate with reasonable accuracy the cost of processing on each indi- 
vidual unit. Each refinery operation has an account to which is charged the 
direct expense (such as operating labor, repairs, etc.) associated with the operation. 
The cost of service functions (such as steam, electricity, etc.) is distributed to 
the processing operations on the basis of the amounts of utilities consumed by 
each. Refinery overhead expense is distributed among the refinery processing 
units on the basis of the direct labor, material and utilities costs (excluding plant 
fuel and chemicals) for each unit. Certain miscellaneous charges and credits 
not included in any of the above costs are incurred in the refinery. These items 
(such as general corporate expense, fire losses, etc.) are of such a nature that their 
distribution among products must of necessity be largely arbitrary. They are 
distributed on the basis of the cost of the products before the inclusion of these 
miscellaneous items. These costs of products are obtained after applying the 
residual fuel oil debits and credits as explained below. 

Costing Policy. — The primary function of our overall refinery operations iq 
considered to be the production of motor fuel, which is the most important 
product marketwise, and which can be obtained by processing crude oil for 
maximum yield of gasoline and minimum yield of residual fuel oil and gas. In 
some cases gasoline is produced in this manner. For this type of operation, the 
cost of gasoline is equal to the cost of crude oil, plus the manufacturing expense, 
less the credit for residual fuel oil and gas. The following table illustrates the 
method of calculating the cost of gasoline for the maximum gasoline yield type 
operation : 

Table I. — Cost of gasoline 

Cost of one bbl. of crude oil F. O. B. refinery .«^ $1. 45 

Cost of processing one bbl. of crude oil for maximum gasoline . 0. 40 

Total debits , $1. 85 

Credit for 0.40 bbl. of residual fuel oil (including gas at fuel oil equivalent) 
produced from one bbl. of crude oil (when running for maximum gasoline) 

at market value of $0.90/bbl $0. 36 

Net cost of 0.60 bbl. of gasoline produced from one bbl. of crude oil (when 
running for maximum gasoline) excl. "Miscellaneous Refinery Charges & 
Credits": 

— $/Bbl. of Crude Oil $1. 49 

— $/Bbl. of -Gasoline $2 48 

Misc. Refinery Charges & Credits — $/Bbl. of Gasoline $003 

Total cost of gasoline — $/Bbl $2.51 

— 0/Gal - . 5.98 



10080 CONCENTRATION OF ECONOMIC POWER 

If intermediate products, such as refined oil, heating oil, etc., are produced by 
segregating portions of the crude stream, the potential yield of gasoline available 
in these fractions must, if total gasoline production is to be held constant, be re- 
placed by an equivalent volume of gasoline which can be produced by processing 
additional crude oil for maximum gasoline yield. Thus the petroleum fractions 
which compose intermediate products have a base value as potential sources of 
gasoline, the value of the potential gasoline being its cost as produced from crude 
oil by a maximum yield operation. This is the fundamental principle underlying 
our costing policy. To illustrate, suppose the cost of heating oil is desired. First, 
the maximum yield of gasoline and the yield of residual fuel oil and gas attainable 
by cracking the heating oil are determined from correlations based on laboratory 
and plant test data. In the following hypothetical example, it is assumed that 
55% of gasoline and 45% of residual fuel oil and gas would be obtained by cracking 
the heating oil and that the cost of the cracking operation would be 45^ per barrel. 
The method used in calculating the cost of the heating oil is as follows: 

Table II. — Cost of heating oil 

0.55 bbl. of potential gasoline x $2.48 per bbl. (See Table I) $1. 36 

Plus 0.45 bbl. of potential residual fuel oil and gas x $0.90 per bbl 0. 41 

$1. 77 
Less Manufacturing expense involved in making maximum gasoline yield 

from heating oil . 45 

Replacement cost of heating oil base stock $1. 32 

Plus Cost of finishing base stock to produce marketable heating oil . 12 

Cost of heating oil exclusive of miscellaneous charges and credits — 

per bbl $1.44 

Plus Miscellaneous refinery charges and credits — per bbl . 02 

Cost of finished heating oU— $/Bbl $1. 46 

— ^/Gal 3. 48 

After the above outlined methods of distributing the elements of cost have been 
applied to all products made, all the crude oil costs and processing costs for the 
refinery are fully accounted for. This procedure, if carried out in the manner 
outlined, involves considerable detailed effort if the refinery is one producing many 
diffei'ent products. 

Entirely apart from the method of costing products heretofore described, and 
for the sake of simplicity in view of the large number of grades carried, inventories 
are evaluated by the method known as the "Federal Trade Commission Method" 
or "Sales Value Metliod". 



CONCKNTKATION OF ECONOMIC POWER 



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CONCENTRATION OF ECONOMIC POWER 



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10084 CONCENTRATION OF ECONOMIC POWER 

EXPLANATION OF SUMMARY COST STATEMENT AND METHOD OF DETERMINING COST 

OF PRODUCTS 
I 

Attached are cost statements for the Standard Oil Company of Louisiana for 
the year 1938, showing the elements of cost entering into product costs. Since 
the cost of practically aU domestic crude oil to the refinery normally exceeds the 
market price of residual fuel oil, manufacturing operations are usually carried 
on for minimum production of residual fuel oil of satisfactory quality and con- 
sequently its cost is not determined but its value is considered to be the price 
realized for it in the open market. The refinery is credited for its residual fuel 
oil production on this basis. Thus, the "elements" which enter into the costs 
of products other than residual fuel oil are (a) cost of crude oil and other petroleum 
raw material, and (b) the refinery processing expense applicable to the manufac- 
ture of these products, less (c) the credit for the residual fuel oil production 
accompanying the manufacture of these distillate products. In the following 
paragraphs will be explained briefly the method of distributing refinery processing 
expense among the various operations, the fundamental basis underlying the cost- 
ing policy and the methods of proration used in distributing each of the above 
"elements of cost" among the various products: 

Refinery Processing Expense. — Refinery cost records are required in sufficient 
detail to indicate with reasonable accuracy the cost of processing on each indi- 
vidual unit. Each refinery operation has an account to which is charged the 
direct expense (such as operating labor, repairs, etc.) associated with the opera- 
tion. The cost of service functions (such as steam, electricity, etc.) is distributed 
to the processing operations on the basis of the amounts of utilities consumed by 
each. Refinery overhead expense is distributed among the refinery processing 
units on the basis of the direct labor, material and utilities costs (excluding plant 
fuel and chemicals) for each unit. Certain miscellaneous charges and credits 
not included in any of the above costs are incurred in the refinery. These items 
(such as general corporate expense, fire losses, etc.) are of such a nature that their 
distribution among products must of necessity be largely .'.rbitrary. They are 
distributed on the basis of the cost of the products before the inclusion of these 
miscellaneous items. These costs of products are obtained after applying the 
residual fuel oil debits and credits as explained below. 

Costing Policy. — The primary function of our overall refinery operations is con- 
sidered to be the production of motor fuel, which is the most important product 
marketwise, and which can be obtained by processing crude oil for maximum 
yield of gasoline and minimum yield of residual fuel oil and gas. In some cases 
gasoline is produced in this manner. For this type of operation, the cost of ga;SO- 
line is equal to the cost of crude oil, plus the nianufacturing expense, less the credit 
for residual fuel oil and gas. The following table illustrates the method of calcu- 
lating the cost of gasoline for the maximum gasoline yield type operation: 

Table I. — Cost of gasoline 

Cost of one bbl. of crude oil F. O. B. refinery - $1. 45 

Cost of processing one bbl. of crude oil for maximum gasoline 0. 40 

Total Debits ^ $1. 85 

Credit for 0.40 bbl. of residual fuel oil (including gas at fuel oil equivalent) 
produced from one bbl. of crude oil (when running for maximum gasoline) 

- at market value of $0.90/bbl $0. 36 

Net cost of 0.60 bbl. of gasoline produced from one bbl. of crude oil (when 
running for maximum gasoline) excl. "Miscellaneous Refinery Charges 
& Credits": 

— S/Bbl. of Crude Oil $1. 49 

— $/Bbl. of Gasohne i $2. 48 

Misc. Refinery Charges & Credits— S/Bbl. of Gasoline $0. 03 

Total Cost of Gasoline— $/Bbl . $2. 51 

— ^/Gal - 5. 98 

If intermediate products, such as refined oil, heating oil, etc., are produced 
by segregating portions of the crude stream, the potential yield of gasoline avail- 
able in these fractions must, if total gasoline production is to be held constant, 
be replaced by an equivalent volume of gasoline which can be produced by proc- 
essing additional crude oil for maximum gasoline yield. Thus the petroleum 
fractions which compose intermediate products have a base value as potential 



CONCENTRATION OF ECONOMIC POWER 10085 

sources of gasoline, the value of the potential gasoline being its cost as produced 
from crude oil by a maximum yield operation. This is the fundamental principle 
underlying our costing policy. To illustrate, suppose the cost of heating oil is 
desired. First, the maximum yield of gasoline and the yield of residual fuel oil 
and gas attainable by cracking the heating oil are determined from correlations 
based on laboratory and plant test data. In the following hypothetical example, 
it is assumed that 55% of gasoline and 45% of residual fuel oil and gas would be 
obtained by cracking the heating oil and that the cost of the cracking operation 
would be 45^ per barrel. The method used in calculating the cost of the heating 
oil is as follows: 

Table II. — Cost of heating oil 

0.55 bbl. of potential gasoline x $2.48 per bbl. (See Table I) $1. 36 

Plus 0.45 bbl. of potential residual fuel oil and gas x $0.90 per bbl 0. 41 

$1.77 
Less Manufacturing expense involved in making maximum gasoline yield 

from heating oil . 45 

Replacement cost of heating oil base stock $1. 32 

Plus Cost of finishing base stock to produce marketable heating oil .12 

Cost of heating oil exclusive of miscellaneous charges and credits — per bbl_ _ $1. 44 
Plus Miscellaneous refinery charges and credits — per bbl .02 

Cost of Finished Heating Oil— $/Bbl $1.46 

— ji/Gal 3.48 

After the above outlined methods of distributing the elements of cost have been 
applied to all products made, all the crude oil costs and processing costs for the 
refinery are fully accounted for. This procedure, if carried out in the manner 
outlined, involves considerable detailed effort if the refinery is one producing many 
different products. 

******** 

Entirely apart from the method of costing products heretofore described, and 
for the sake of simplicity in view of the large number of grades carried, inventories 
are evaluated by the method known as the "Federal Trade Commission Method" 
or "Sales Value Method". 



Standard Oil Company of New Jersey 

explanation of summary cost statement and method of determining cost 

of products 

Attached are cost statements for the Standard Oil Company of New Jersey for 
the year 1938, showing the elements of cost entering into product costs. Since 
the cost of practically all domestic crude oil to the refinery normally exceeds the 
market price of residual fuel oil, manufacturing operations are usually carried on 
for minimum production of residual fuel oil of satisfactory quality and conse- 
quently its cost is not determined but its value is considered to be the price 
realized for it in the open market. The refinery is credited for its residual fuel 
oil production on this basis. Thus, the "elements" which enter into the costs of 
products other than residual fuel oil are (a) cost of crude oil and other petroleum 
raw material, and (b) the refinery processing expense applicable to the manu- 
facture of these products, less (c) the credit for the residual fuel oil production 
accompanying the manufacture of these distillate products. In the following 
paragraphs will be explained briefly the method of distributing refinery processing 
expense among the various operations, the fundamental basis underlying the 
costing policy and the methods of proration used in distributing each of the above 
"elements of cost" among the various products: 

Refinery Processing Expense. — Refinery cost records are required in sufficient 
detail to indicate with reasonable accuracy the cost of processing on each indi- 
vidual unit. Each refinery operation has an account to which is charged the 
direct expense (such as operating labor, repairs, etc.) associated with the opera- 
tion. The cost of service functions (such as steam, electricity, etc.) is distributed 
to the processing operations on the basis of the amounts of utilities consumed by 
each. Refinery overhead expense is distributed among the refiinery processing 



1 0086 CONCENTRATION OF ECONOMIC POWER 

units on the basis of the direct labor, material and utilities costs (excluding plant 
fuel and chemicals) for each unit. Certain miscellaneous charges and credits 
not incladed in any of the above costs are incurred in the refinery. These items 
(such as general corporate expense, fire losses, etc.) are of such a nature that their 
distribution among products must of necessity be largely arbitrary. They are 
distributed on the basis of the cost of the products before the inclusion of these 
miscellaneous items. These costs of products are obtained after applying the 
residual fuel oil debits and credits as explained below. 

Costing Policy. — The primary function of our overall refinery operations is 
considered to be the production of motor fuel, which is the most important product 
marketwise, and which can be obtained by processing crude oil for maximum 
yield of gasoline and minimum yield of residual fuel oil and gas. In some cases 
gasoline is produced in this manner. For this type of operation, the cost of 
gasoline is equal to the cost of crude oil, plus the manufacturing expense, less the 
credit for residual fuel oil and gas. The following table illustrates the method of 
calculating the cost of gasoline for the maximum gasoline yield type operation : 

Table T. — Cost of gasoline 

Cost of one bbl. of crude oil F. O. B. refinery $1. 45 

Cost of processing one bbl. of crude oil for maximum gasoline 0. 40 

Total debits .. $1. 85 

Credit for 0.40 bbl. of residual fuel oil (including gas at fuel oil equivalent) 
produced from one bbl. of crude oil (when running for maximum gaso- 
line) at market value of $0.90/bbl $0. 36 

Net cost of 0.60 bbl. of gasoline produced from one bbl. of crude oil (when 
running for maximum gas'^line) excl. "Miscellaneous Refinery Charges 
& Credits": 

— $/Bbl. of Crude Oil - $1. 49 

— $/Bbl. of Gasoline $2. 48 

Misc. Refinery Charges & Credits —$/Bbl. of Gasoline $0. 03 

Total Cost of Gasoline— $/Bbl $2. 51 

— ^/Gal 5.98 

If in tei:xnediate products, such as refined oil, heating oil, etc., are produced by 
segrega|ting portions of the crude stream, the potential yield of gasoline available 
in thes'8 fractions must, if total gasoline production is to be held constant, be 
replaced by an equivalent volume cf gasoline which can be produced by processing 
additional crude oil for maximum gasoline yield. Thus the petroleum fractions 
which viompose intermediate products have a base value as potential sources, of 
gasoline, the value of the potential gasoline being its cost as produced from crude 
oil by }i maximum yield operation. This is the fundamental principle underlying 
our cos-i,iTig policy. To illustrate, suppose the cost of heating oil is desired. First, 
the ma \imum yield of gasoline and the yield of residual fuel oil and gas attainable 
by crai king the heating oil are determined from correlations based on laboratory 
and pl.int test data. In the following hypothetical example, it is assumed that 
55% ot gasoline and 45% of residual fuel oil and gas would be obtained by cracking 
the he.i ting oil and that the cost of the cracking operation would be 45j5 per barrel. 
The fji'ithod used in calculating the cost of the heating oil is as follows: 

Table II. — Cost of heating oil 

0.55 bbl. of potential gasoline x $2.48 per bbl. (See Table I) $1. 36 

Plus 0.45 bbl. of potential residual fuel oil and gas x $0.90 per bbl 0. 41 

$1. 77 
Less Manufacturing expense involved in making maximum gasoline yield 

from heating oil . 45 

Replacement cost of heating oil base stock $1. 32 

Pj is Cost of finishing base stock to produce marketable heating oil .12 

jj 

fC>pst )\ heating oU exchisivr of miscellaneous charges and credits — per bbl. $1. 44 
>;^!i]s Miscellaneous refinery charges and credits —per bbl , . 02 

Cost of Finished Heating Oil— $/Bbl $1. 46 

-WGal 3. 48 



CONCENTRATION OF ECONOMIC POWER 10087 

After the above outlined methods of distributing the elements of cost have 
been applied to all products made, all the crude oil costs and processing costs for 
the refinery are fully accounted for. This procedure, if carried out in the manner 
outlined, involves considerable detailed effort if the refinery is one producing many 
different products. 

Entirely apart from the method of costing products heretofore described, and 
for the sake of simplicity in view of the large number of grades carried, inventories 
are evaluated bv the method knovv^n as the "Federal Trade Commission Method" 
or "Sales Value" Method". 

Cost of crude and other products processed or blended during 1938 — Standard Oil 

Company of New Jersey 

New Jersev Refineries $62, 525, 998. 75 

Baltimore Refinery 15, 182, 996. 66 

Charleston Refinery 1, 527, 548. 97 

Total $79,236, 544. 38 



10088 



CONCENTRATION OF ECONOMIC POWER 



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CONCENTRATION OF ECONOMIC POWER 



10091 



1, 078, 674. 21 

15.5, 411. 33 

389, 048. 45 

22, 643. 27 


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10092 



CONCENTRATION OF ECONOMIC POWER 



Standard Oil Company (Ohio) 

reply to question 32 op tnec questionnaire 

32. The refinery cost statements prepared by the company do not result in any 
figures for the cost of fuel oil. Cost figures as to gasoline, however, are arrived at 
and for the principal grade of gasoline, that is the regular grade-accounting for 
over 90% of the total gasoline production, were as follows for the various refineries 
operated by the company and its subsidiary. The Latonia Refining Corporation, 
Latonia, Kentucky. 

Cost (At refs.) As Per Ref. Cost Statements of Reg. Gid. Gas. {Averages for Yr. 1938) 

Standard Oil Co. Refineries: 

Cleveland Refinery 6.85j5 per gallon 

Toledo Refinery 6.66 " 

Lima Refinery 6.67 " " 

Latonia Refining Corporation: Latonia Refinery. _ _ 6.59 " " 

The method by which these gasoline cost figures are arrived at is as follows: 
The cost of all crude oil and other charging stock plus all operating expense, 
including depreciation, overheads, taxes, royalties, supplies, chemicals, lead, etc., 
are added together to make up the total expense of manufacturing all of the prod- 
ucts made. From this total is then deducted the net realization, or net back, on 
all products other than gasoline. The balance is treated as being the cost of 
manufacturing the gasoline, and when divided by the number of gallons of gasoline 
manufactured becomes the cost per gallon. 

By the term "net back" or "net realization" from the sale of other products, as 
used above, is meant the total amount received for such products less the freight 
or other transportation charges incurred and less the estimated expense incurred 
in making and handling the sales. 

It can thus be seen from the method described that no cost figures are 
arrived at as to fuel oil. 



Sun Oil Company 

REPLY TO item NO. 32 OF TNEC QUESTIONNAIRE 

There is no exact method for the determination of costs in a multiple product 
industry. The method our company follows is that of taking entire costs and 
applying these, equally against the products produced in proportion to their 
gallonage. When these products are sold a profit or loss is sustained depending 
upon whether or not the costs as heretofore determined are greater or less than the 
selling price. On the theory that no profit is realized until the product is sold, this 
method results in an accurate determination of profits earned. 

Sun Oil Co. Refinery Expenses and Products Refined, Year 1938 





Marcus 
Hook 


Toledo . 


Yalfi 


Refinery Expense: 

Labor _, 


$3,870,878.18 

fiW, 107. 76 

2, 027, 669. 78 

628, '31.83 

89, 323. 24 

64, 7W. 87 

1, 687, 209. 87 

1,012,044.28 


$835, 881. 22 

78, 457. 14 

275, 913. 68 

36, 345. 99 

22,204.11 

12, 333. 4.5 

267, 538. 57 

220, 123. 96 


$49,744.00 


Supplies & Repair Material 


10, 873. 44 


Fuel 


7,200.58 


Cbemicals 


4,161.06 


Insurance. 


4, 476. 07 


Taxes 


5, 480. 34 


Depreciation . 




Miscellaneous ; 


13,531.98 






Less: Package Costs, eto--........— .. - 


$9, 938, 197. 88 
804,387.14 


$1, 438, 798. 12 


$95,457.47 










$9,430,810.71 
22. 468, 969 






Crude Run to Stills— Barrels 


2, 649, 147 


662,182 







CONCENTRATION OF ECONOMIC POWER 10093 

Sun Oil Co. Refinery Expenses and Products Refined, Year 1938 — Continued 



Marcus 
Hook 



Toledo 



Yale 



Products (Barrels): 

Qasoline 

Kerosene 

Gas Oil. 

FuelOU 

Lubricating Oils... 

Asphalt 

Propane & Butane 

Vapor Gas 

Loss ' 



752, 302 
170, 787 
271, 477 
052, 814 
207,984 
34, 578 
306, 033 
620, 452 
947, 458 



1, 347, 074 
115, 292 
162, 982 
835, 598 



214, 060 
110, 661 



323, 052 



51,312 

511,061 

' 374, 172 



14, 379 



22, 468, 969 



2, 649, 147 



662, 152 



> Statement indicates a negative loss whereas our actual refining loss runs between 1% and 2%. 
SUPPLEMENTAL REPLY TO ITEM 32 PER LETTER RECEIVED SEPTEMBER 1, 1939 

As we statea in our answer to this question, there is no exact method for the 
determination of costs in a multiple product industry. We, therefore, regret our 
inability to give the per unit cost of a gallon of gasoline and fuel separately at 
the Refinery Gate. We are attaching hereto, howeyer, as Exhibit 2, statement 
setting forth a summary cost statement of each refinery, the crude run therein 
and the products resulting from this crude calculated on the U. S. Bureau of 
Mines basis. 



The Texas Corporation 

T. N. E. C. questionnaire FOR OIL COMPANIES 

Question 32. 

Summary cost statement for each domestic refinery operated (a) by the report- 
ing company, of (b) by its subsidiaries or aflfiliates, for the year 1938, showing 
the principal elements of cost determining the cost of a gallon of gasoline and fuel 
oil (separately), at the refinery gate (exclusive of any selling expenses). Explain 
briefly the costing policy followed with particular reference to the method of 
proration of the elements of costs of the refining operations among the various 
products produced. 
Answer. 

(1) Refining costs cannot be precisely determined: 

We are outlining below a few of the outstanding facts or circumstances support- 
ing the belief that it is humanly impossible to determine the precise cost of any 
particular quantity of refined petroleum products at the refinery gates: 

What we have to say in the following paragraphs wiU be equally applicable to 
any refined petroleum product that has been normally processed; however, in 
order to simplify our explanation, we will speak in terms of "Gasoline." 

(1) The identity of the Gasoline is indeterminate, i. e., we are absolutely 
unable to say in most cases from what particular crude any specific quantity of 
Gasoline was manufactured. 

To elaborate on the difiference, which the class of crude from which the Gasoline 
is manufactured would have on the cost of Gasoline, I have merely to call atten- 
tion to the fact that certain crudes are produced practically at the refinery gates, 
while other crudes must be transported hundreds of miles, either by pipe line, 
tanker or rail, at considerably higher costs. Also, some of these crudes are 
expensive and some are relatively low in cost. Some of the crudes produce a 
ve?y high percentage of Gasoline and yield valuable by-products, while others 
produce a low percentage of Gasoline and the by-products are less valuable. 

The fact that these various crudes are mixed to a considerable extent in trans- 
porting to the refinery and are stored in 55,000 to 120,000 barrel tanks at the 
refinery, makes it impossible for the operating personnel to prevent the con- 
tamination of grades, and it is therefore evident that it is impossible to determine 



10094 CONCENTRATION OF ECONOMIC POWER 

from which crude oil any particular quantity of Gasoline is manufactured. Since 
it is impossible to determine the crude oil from which the particular Gasoline 
was manufactured, and the crude transportation cost and purchased price, it is 
then impossible to determine the cost of the products from any particular crude oil. 

(2) The total cost of petroleum products may be approximately classified as 
follows: 

(a) The cost of charged stocks and other raw materials used. 

(b) Total refinery operating cost allocated where possible, to specific processes 

and departments. 

(c) General overhead and administrative expenses allocated to refining opera- 

tions on an arbitrary basis. 

(d) Loading and shipping expenses. 

The items listed above constitute the total Refining Department cost which is 
easily determined. The total cost calculated in this manner represents the cost 
of ail petroleum products manufactured from the crude oil, but the difficulty 
lies in allocating these costs to any particular grade of product such as Gasoline. 
The reason for this is apparent. From the same barrel of crude oil a variety of 
products may be and is manufactured, many of these being taken simultaneously 
from the same operating equipment. For example, a given barrel of crude oil 
produces successively Gasoline, Kerosene, Gas. Oil, Lubricating Oils of various 
viscosities, Fuel Oil, Wax, Asphalt, Coke and Gas. These stages are a part of the 
continuous treatment of that barrel of crude oil. To ascertain exactly what part 
of the entire cost of raw materials and processing the barrel is applicable to any 
particular product is then a physical impossibility due to the nature of the material 
itself and the method of removal from the whole. 

(3) Waiving the difficulties outlined above, any attempt to arrive at the cost 
of Gasoline must necessarily be done in retrospect, as it would be impossible with a 
reasonable force of clerks to calculate an hourly or even a daily cost of Gasoline. 
The practice is, where costs are prepared, to prepare them on the basis of the 
calendar month. Due to the volume of work involved in this calculation, it 
requires approximately sixty days from the last day of any month before the 
costs for that month are available. This latter statement, of course, applies only 
to large refineries where the number of individual products run into the hundreds 
and sometimes even into the thousands. This condition clearly indicates that 
Gasoline may be delivered or sold at the refinery gates several weeks before the 
cost of such Gasoline has been determined, and this is assuming that we waive the 
difficulties of cost determination, as pointed out under Sections (1) and (2) above. 

(4) Under Section (2) Item (c) above, it is indicated that general overhead and 
administrative expenses are allocated to refining operations on an arbitrary basis. 
This is also partially applicable to (b) as well. Speaking with reference to a 
large refining company operating several refineries scattered throughout the 
United States, a portion of general overhead and administrative expenses must 
necessarily be distributed to each of the refineries. The best that can be said for 
the method of distributing these expenses is that it is a matter of opinion, and the 
method to be used is generally outlined by the accounting heads. 

(5) The method of determining the cost of products, which has been used by 
many large refiners for several years, is called "sales realization method," of which 
the following account appears in the report made during 1932 to the U. S. House of 
Representatives by the U. S. Tariff Commission: 

"Under this method, all groups of cost items are distributed among the 
several major products in the same proportion that the total sales of each of 
such major products bear to the sales of all products. In distributing costs 
in this way, no distinction is made between the cost of processes undertaken 
solely or primarily for the production of one or more specific products only 
(so-called 'separable' costs) and the cost of processes not undertaken solely 
or primarily for any specific product or products (so-called 'inseparable' 
costs) . The cost of every^process irrespecitve of its purpose or the number or 
character of its products is distributed in the same proportions over all 
products of the refinery." (pp. 71, 72.) 

, While The Texas Company does not employ the method outlined exactly, our 
method is very similar to, and a variation of, the one defined. The method 
employed by The Texas Company is described next below. 

(2) Method employed by The TexaS Company in estimating refining costs: 



(CONCENTRATION OF ECONOIN POWER 



10095 



I. REFINERIES RUNNING FOR GASOLINF ANl 



jrtation at regular pipe 

if transportation to the 

^t" of all products. 

)il, Gas and Coke at 

as their elimination 

une. 

and Kerosene) and the 



Crude Oil is charged at posted field prices plus trai 
line, marine, or rail freight rates (depending on thtj inot 
refinery), plus refining expenses to determine the "Total ( 

From the above is deducted the production of i-'ucl 
Market Value. The latter are considered "By-Producl 
from the crude is ne^ossary to produce Gasoline and Ker 

The remaining products are the Refined Oils (Gasoli' 
combined cost of these two products is the cost remaining after deducting the 
market value of "By-Products" from "Total Cost". 

The combined cost of Gasoline and Kerosene is distributed to the several grades 
of Gasolines and to Kerosene in proportion to their market value. 

This method determines the finished cost of Kerosene, c^nd the cost of the base 
stocks from which Gasolines are finished by blending with Leading Lead or 
Natural Gasoline. The cost of the Tetra-Ethyl Lead and/or Natural Gasoline 
used is added to the cost of Gasolines produced, to determine the finished cost of 
Gasolines: 

EXAMPLE ONE 





Barrels 


Cost per 
barrel 


Amount 


Crude Oil at Posted Price .. - 


1.0000 


$1.00 
.19 


$1.00 


Gathering and Pipage.. . 


.19 








Delivered Cost of Crude - 




1.19 
.38 


1.19 


Refining Expense 




.38 








Total Cost -- 




1.57 


1.57 








Less: By-Products: 

Fuel Oil 


.0371 
.1006 
.0898 
.0066 


.81 
.95 
.14 
.00 


.03 


Gas . 


.10 


Coke -.- 


.01 


Loss ■- " -- --- 


.00 






Total...- - - 


.2341 
.7659 




.14 


Cost of Refined Oils 


1.87 


1.43 









Bbls. 


Ratio mar- 
ket value 


Cost per 
bbl. 


Cost per 
gal. 


Cost Prorated to Refined Oils: 
392 Gasoline Base Stock 


0. 5836 
.1289 
.0534 


106.00 
90.00 
80.00 


$1.94 
1.74 
1.55 


■SO. 0461 


USM Gasoline Base Stock 


.0415 


Water White Kerosene 


.0369 






Total 


.7659 




1.87 


.0445 











0^ 
70 


Per gallon 


Oost per 
?al. 


Fire-Chief Gasoline: 

392 Gasoline Base Stock 


99.00 
01.00 


$0.0461 
.0491 


$0. 0456 


Natural Gasoline- 


. 0005 


Tetra-Ethyl Lead . . 


. oo;ii 










Cost Fire-Chief Gasoline. 


100.00 


---.--. 


.0492 






USM Gasoline: 

USM Gasoline Base Stock 


98.00 
02.00 


.0415 
.0491 


.0407 


Natural Gasoline 


.0010 






Cost USM Gasoline _ 


100.00 




.0417 









10096 



CONCENTRATION OF ECONOMIC POWER 



II. REFINERIES RUNNING FOR QASOLINB, KEROSENE, LUBRICATING OILS AND 

ASPHALT 

This method requires that the Refinery Expenses be sub-divided as follows: 

Crude Refining Department. — For Manufacture of Gasoline and Kerosene. 

Lubricating Oil Department. — For Manufacture of Lubricating Oils. 

Asphalt Department. — For Manufacture of Asphalt. 

Crude Refining Department. — The costs of Gasolines and Kerosene are com- 
puted by charging the Crude Oil at delivered cost, adding the expenses of the 
Crude Refining Department, and deducting By-Products at Market Value. In 
addition, the distillates and residua reserved foi: manufacturing Lubricating Oils 
(which would otherwise be processed through cracking stills for Gasoline) are 
deducted at their potential values as cracking stocks. The potential value of a 
product is computed by evaluating the finished yields from cracking the stocks 
at current market values of Gasoline, Fuel Oil and Gas, and deducting the expenses 
of the operations necessary to finish. 



EXAMPLE TWO 










Barrels 


Cost per 
bbl. 


Amount 


Crude Oil at Posted Price 


1.0000 


$1.15 
.14 


$1.16 


Gathering and Pipage ... 


.14 








Delivered Cost of Crade... - 




1.29 
.30 


1.29 


Cnidn TiAflning KvpensfiS. 




.30 








Total Cost 




1.69 


1.59 








Less: By-Products: 

Lubricating Distillate - 


.1000 
.1699 
.0685 
.0021 


1.20 
.65 
.71 
.00 


.12 


Fuel Oil 


.11 


Gas 


.06 


Loss 


.00 






Total By-Products . 


.3405 




.28 








Cost of Refined Oils 


.6595 


1.98 


1.31 







The above cost of Gasoline and Kerosene is distributed to the different grades 
of Gasoline, and to Kerosene, in proportion to the market value of these products. 
The cost of Natural Gasoline and Tetra-Ethyl Lead is added as illustrated in 
Example One. 

Lubricating Department. — Beginning with the Lubricating Distillate at its poten- 
tial cracking value, expenses of the various processes in the Lubricating Depart- 
ment are added, step by step, until the finished cost of each Lubricating Oil is 
developed. 

Any Gas Oil recovered in these finishing processes is considered as a by-product 
of the Lubricating Department, and is credited at its potential cracking value. 



EXAMPLE THREE 










Barrels 


Cost per 
bbl. 


Amount 


Lubricating Distillate 


1.0000 


$1.20 
.20 


$1.20 


Vacuum Stilling Expenses 1 


.20 








Total Cost 




1.40 


1.40 








Less: By-Products: 

GasOU 


.1200 
.0100 


1.20 


.14 


Loss . 


.00 








Total 


.1300 




.14 








Cost Lubricating Stocks 


.8700 


L46 


1.26 







CONCENTRATION OF ECONOMIC POWER 



10097 



The production of Lubricating Stock is shown above in one lump figure, althoujrh 
It actually may contain several fractions of different viscosities, the cost being 
distributed to the different viscosities in proportion to the relativr mrket values 
of the production, as follows: voiuco 

EXAMPLE FOUR 



100 Pale Stock 
300 Pale Stock 
500 Pale Stock 
750 Pale Stock 

Total... 



Barrels 



0.1500 
.3000 
.1500 
.2300 



.8700 



Cost per 
bbl. 



$1.25 
1.30 
1.45 
1.48 



Amount 



$0.31 
.39 
.22 
.34 



1.26 



Each of these Lubricating Stocks require treatment with acid, after which it 
S? examX ^ Lubricating Oil of the same viscosity as the stock treated, 

EXAMPLE FIVE 





Barrels 


Cost per 
bbl. 


Amount 


100 Pale Stock 


1.0000 


.$1. 25 
.20 




Treating Expenses 


$1.25 






. 20 


Total Cost 




1.45 








1.45 


100 Viscosity Pale Oil.. 


.9500 
.0500 


1.53 




Sludge and Loss 








.00 


Total 


1.0000 




1.45 









rr^Hl^J^^' ^^^ ^"*^ "^^^ Viscosity Pale Stocks would be finished in a similar 

P«!IffinrRo"^^'^ Naphthenic Base Lubricating Oils for this iUustration, however 
S?hf fin^'t ^"k ^yV^^f^ Oils, although differing in the processing required, 
would be finished by using the same principles of cost e m c , 

Asphalt Department.— Asphalt is produced by further distillation of that portion 
^' Jf?f J.^si^H? fyom crude that may normally be disposed of as Fuel Oil This 
finn f^i'^".^n^^ .• *" "'^i^i^i^g' or solidifying, of the Fuel Oil to required specifica- 
wS;/ h,?r^ • *• """n °'" '^^^^'''/ P°^"*^- The finished product is used in various 
wajs, but principally as road paving material and for the impregnation and 
coating of dry felt for the manufacture of roofing ^ 

+n ;t^ l^^ "!l^*^ifJ charged to the Asphalt Department is evaluated as Fuel Oil. 
m^ i'''-^^^'^ the expenses of distillation or reducing to asphalt. The products 
recovered in processing are credited at Fuel Oil or potential cracking values 
depending on the distiUation range of the product ci^tcKing vaiues, 



EXAMPLE SIX 










Barrels 


Cost per 
bbl. 


Amount 


Fuel Residuum 


1.0000 


$0.65 
.30 




Reducingi-Expenses 


$0.66 






.30 






.95 


.95 


Less: 

Fuel Distillate 




.2000 
.0100 

.2100 


.65 




Loss " 


.13 
.00 

13 


Total 





Cost Asphalt Group I 


.7900 


1.04 


.82 



10098 



CONCICNTRATION OF ECONOMIC POWER 



lliis illustrates the method of costing Asphalt of one particular grade, however, 
each grade is computed separately. Each may require a different degree of 
distillation, but the same cost principles can be applied. 

These cost methods have been in effect for several years in The Texas Com- 
pany, and were adopted only after exhaustive and comprehensive studies by our 
accountants in collaboration with our operating management. The system was 
de.iigned to meet the requirements of the Refining Department for recording actual 
costs :^and to forecast probable results from old or new equipment and apparently 
has accomplished the desired results. 

Various methods of costing are used by others in the oil industry but as far as 
>we know none use the same system as The Texas Company. For this reason 
our, cost figures applied to different products could not be compared correctly 
with the cost figures of other units of the Industry, or with costs of the Industry 
as a whole. 

(3) Costs as determined by the method described above: 

Averago. cost of gasoline and fuel oil, year 1938 



Gasoline, 
per gallon 



Fuel oil, 
per barrel 



The Texas Company (Delawaie): 

Port Arthur Works 

Port Neches Asphalt Plant •_ 

Shreveport Works ' 

Houston Works _ 

West Dallas Works _ 

San Antonio Works 

El Paso Works 

Amarillo Works .■ 

West Tulsa Works. 

Pryse Works 

Lockport Works 

Casper Works, _ -... 

Craig Works 

Cody Works. 

Norfolk Asphalt Plant ' 

Delaware River Asphalt Plant ' 

Providence Asphalt Plant ' 

California Petroleum Corporation (Utah): Calpet Works. 

International Refining Company: Sunburst Works 

Indian Refining Company: Lawrenceville Works 

The Texas Company (California): 

Los Angeles Works 

Fillmore Wcks 

Coalinga Works 



$0. 0594 



$0.6050 



.0529 
.0508 
.0509 
.0611 
.0480 
.0573 
.0733 
.0630 
.0588 
.0621 
.0724 



.6622 
.6106 
.7747 
.7653 
.6944 
.6984 
.6467 
.7776 
.9520 
. 5189 
.4627 
.6024 



.0688 
.0525 
.0559 

.0626 
.0550 



.9439 
.7650 
.8432 

.8264 
.6918 



1 No Finished Gasoline or Fuel Oil manufactured at these plants. 



Tide Water Associated Oil Company 

Estimated per gallon values of gasoline — Used in estimating values of inventories 
of gasoline at December 31, 1938 for income purposes 





First Second 
grade grade 


Third 
grade 


Avon Refinery (Associated, California) . 


0.0646 
.0646 
.0696 
.0563 


0.0471 
.0471 
.0515 
.0438 


0. 0421 


Watson Refinery (Wilmington, California) 


.0421 


Bayonne Refinery (Bayonne, New Jersey) 


.0465 















(CONCENTRATION OF ECONOMIC POWER 10099 

REPLY TO ITEM #32 OF TNEC QUESTIONNAIRE 

We have no method of accurately computing the cost of each product manu- 
factured from Crude Oil, chiefly due to two facts: first, because it is impossible 
to assign to each product its just proportion of the cost of the raw material, the 
largest single item of cost, and secondly, because the refining processes are con- 
tinuous and there is such an interrelation between them as to make the allocation 
of the processing costs to individual products impossible without major arbitrary 
assumptions. 

A number of arbitrary costing methods have been attempted to approximate 
costs of certain products under a given set of conditions and assumptions. 

We have experiment°ed with various methods, but in all cases arbitrary assump- 
tions must be employed in the division of costs and value of by-products which 
defeat any attempt to determine profit or loss on each product by accurate costing. 



Union Oil Company of California 

REPLY TO item NO. 32 OF TNEC QUESTIONNAIRE AS CONTAINED IN SUPPLEMENTAL 
LETTER RECEIVED SEPT. 1, 1939 

The company feels it should not be called upon to furnish the information 
requested in this question as the determination of costs involves so many con- 
stantly varying factors, some of them more or less arbitrary, that the results 
obtained without detailed explanation would neither be fair to the company nor 
serve as an accurate basis for any computations the committee might desire to 
be made thereon. 



NON-MAJOR COMPANIES 



Amerada Corporation 

ANSWER to question 32 OF THE TNEC QUESTIONNAIRE 

Ans. Not applicable— not engaged in refining. 



American Republics Corporation 

reply to item 32 OF T. N. E. C. QUESTIONNAIRE 

(b) American Petroleum Company, Norwsorlhy Topping Plant 



Cost of Crude on 

Cost of ToDping Plant operations - 
Topping Plant depreciation. 

Total Cost 



Gasoline 



0. 04624 
.00371 
.00031 



.05026 



Fuel oil 



0. 01.543 
.00107 
.00010 



.01660 



COST POLICY 

1. The potential market value of each product recovered from topping plant 
operations each month is calculated. 

2. The potential market value of all products recovered from topping plant 
operations each month is obtained by the addition of the potential market values 
of each of the products recovered. 

3. All costs for each month are apportioned to each product recovered in same 
percentage as the potential market value of each such product (#1 above) bears 
to the potential market of all products recovered (#2 above). 



J.24491— 40— pt. 17-A XQ 



10100 CONCENTRATION OF ECONOMIC POWER 

Ashland Oil & Refining Company 

32. Summary cost statement for each domestic refinery operated (a) by the 
reporting company, or (b) by its subsidiaries or affihates, for the year 1938, 
showing the principal elements of cost determining the cost of a gallon of gasoline 
and fuel oil (separately), at the refinery gate (exclusive of any selling expenses). 
Explain briefly the costing policj^ followed with particular reference to the method 
of proration of the elements of costs of the refining oper.itions among the various 
products produced. 

REFINERY COSTS, YEAR 1938 





Cost Per 

Barrel of 

Crude Oil 

Refined 


Amount of 
Expense 


Operating: 

Labor 


0. 0978 
.0129 
,064R 
. 0176 
. 0457 
. 0056 


174,301.81 


Electric Power 


22, 033. .58 


Fuel - 


115, 101.85 


Process Chemicals _ 


31,416.05 


Royalties 


81, 483. 27 


Telephone, Freight & Misc. Expense 


10, 010. 44 






Total -i; -. 


.2442 


435, 217. 00 


Maintenance: 

Labor .._ 

Material 


. 0450 
.0186 


80, 133. 06 
86, 652. 18 


Total 


.0036 


106, 785. 24 


Fixed Charges: 

Depreciation . . . . . 


. 0557 
.0075 
.0037 


99, 304. 60 


Insurance . 


13. 380. 72 


Property Taxes 1.. ... 


6, 553. 4S 


Tei*al 


.0669 
.0475 


110.238.80 


Overheau: General Administrative 


8i. 020. 57 






^otal Manufacturing & Overhead Expense Except Tetra-Ethyl Lead 

Tctra-Ethvl Lead . 


. 45?2 
.1335 
1. ,5876 


80.5,891.61 
237. 703. 53 


Crude Oil Refined, 1,781,344 (bbls.) 


2,828.140.60 






Total Cost 


2. 1733 


3, 871, 804. 74 








Barrels 


Per C -nt 


Product Yields: 


873, 649 
154, 24S 
295, 786 
42, 276 
303, 464 


49. 04 




8.66 




16.60 


Residual Fuel Oil .._ 


2 37 




17.04 






Total Yield - . 


1, 669, 423 
111,921 


93.71 


Refining Loss . . 


6.29 








1, 781, 344 


100.00 



CONCENTRATION OF ECONOMIC POWER lOlOl 

Our company makes no eCFort to prorate the cost of manufacture between 
various refined products. Costs are broken down into direct charges against 
various process operations, maintenance, materials, royalties, etc., and totalled 
to show the expense of refining a barrel of crude oil. Corresponding figures are 
compiled to show the prices realized for the various refined products and the total 
figure is compiled showing the gross realization each month from the products 
refined from a barrel of crude oil. The difference between the amount realized 
from the products from a barrel of oil and the cost of manufacture, including the 
posted market for crude oil, represents the refining profit or loss per barrel, as the 
case may be. Since the allocation of profit or loss between the particular products 
is purely arbitrary, we believe there is very little advantage in making such an 
allocation for the purpose of determining the cost of producing any particular 
product, although generally speakihg, we consider gasoline our main item and the 
balance by-products. We believe that the only realistic method for arriving at 
sales prices is to take the highest figure which competitive conditions.isr 'each 
product will permit. We believe that arbitrary cost figures often result in arbi- 
trary sales prices which are not realistic. 



Barnsdall Oil Co. 

reply to item 32 of t. n. b. c. questionnaire 

In relation to this question for a cost statement for refineries, inasmuch as the 
reporting company has no refineries, and inasmuch as it is not engaged in the 
manufacture or sale of gasoline, the question has no application to the reporting 
company. 

REMARKS — QUESTION 32 

In answering Question No. 32 we submit a copy of our Cost Statement for the 
year 1938 for each of our three refineries. This Cost Statement is prepared on 
what is known as the By-products method. 

There is no known method of arriving at an aceurate cost of the various products 
made from crude oil when those products are aU derived from one operation and 
from the same piece of distillation equipment. All of the regularly used methods 
use the wholesale selling price of the finished products as a basis for determining 
the cost of manufacture. 

The By-products method has served our Company as a comparison of opera- 
tions from month to month and is based on the theory that the distillation equip- 
ment is used primarily to produce gasoline, the other products produced in the 
process of producing the gasoline being considered as By-Products. On that 
theory the cost of making gasoline is the total cost of crude oil, plus transportation 
and processing expense, less the amount recovered from the sale of By-Products, 
(products other than gasoline produced). 

The statements attached include a prorata of advertising and wholesale selling 
expense and the administrative expense of our Company applied to refinery opera- 
tions. You will also notice that the cost of "Q"ing and Ethylizing are shown 
as separate items. 



10102 



CONCENTRATION OF ECONOMIC TOWEll 



Cost of making gasoline from skimming and cracking plant operations 
WICHITA REFINERY 




Total Crude Oil & Transportation 
Skimmin? Plant Costs 
Cracknig Plant Costs 



Less: Value of By-Products 
Kerosene 
38-40 Distillate 
Tractor Distillate 
Diesel Fuel 
Fuel OU 

Fuel Oil— Residuum 
Reduced Crude— Okmulgee 
Reduced Crude— Wichita 
Oas Residue 

Total By-Products 

Deduct Prorata: 

Advertising & Selling Expense 
Administrative Expense 



Total Advertising, Selling & Administrative Expense- 
Net Value of By-Products - 



Cost of Gasoline From Crude (Before Depr. Inc. Evap. Loss) 

Add: Cost of Purchased Casinghead. 

Cost of Gasoline After Adding Casinghead (Before Depr.)- 

Add Prorata: 

Refinery Depreciation - - --• 

Advertising & Selling Expense.- -- 

Administrative Expense - 



Cost of Gasoline Delivered (Not Inc. "Q" nor Ethyl) 

Additional Cost of "Q"ing--- - - 

Additional Cost of Ethylizing 



Average Cost of All Grades of Gasoline Shipped 



I M. Cu. Ft. 
•Indicates red figures. 



CONCENTRATION OF ECONOMIC POWER 



10103 



Cost of making gasoline from cracking plant operations 
CORPUS CHRISTI REFINERY 



Ultimate Yield From Crude Blend: 

Gasoline— Stills 

Fuel Oil - - 

Fuel Oil— Slop 

Oas Residue -. 



Total Yield. 
Loss . 



Grand Total. 
M. Cu. Ft. Gas..-. 



Gallons Gasoline From Crude Blend- 
Purchased C. H. Gasoline Added 

Purchased Third Grade Gasoline 



Total Gasoline Produced. 



Summary of Costs: 

Crude Blend & Transportation, 
Cracking Plant Expense.. .: 



Total Crude Blend & Processing. 



Less: Value of By- Products: 

Fuel Oil 

Fuel Oil-Slop 

Gas Residue 



Total By-Products. 



Deduct Prorata: 

Adv., Selling <t Commission. 
Administrative E.xpense 



Total Adv., Selling & Admin. Expense. 



Year J 938 



Barrels 



Net Value of By-Products _ 

Cost of Gasoline From Crude Blend (Before Depreciation Includ- 
ing Evaporation Losses) 

Add: 

Cost of Purchased Casinghead 

Cost of Purchased 3rd Grade Gasoline 



Cost of Gasoline After C. IT. & 3rd Grade Gasoline (Before De- 
preciation) - 

Add: 

Depreciation _ 

Commission— Cargo 

Commission — "A" Units 

.^dministiative Expense 



Average Cost of all Grades of Gasoline. 



.'<93. 671 

.'564, 400 

*1, 959 

140, 612 



1, 596, 724 
110,864 



1, 707. 588 



Amount 



2, 091. 008. 93 
357, 898. 61 



2, 448, 907. 54 



348. 450. 71 

•882. 26 

42, 246. 60 



389, 815. 05 



3, 324. 85 
22,571.70 



25, 896. 55 



363, 918. 50 
2,084,9.S9.04 



16, 964. ,'^0 
33, 587. 01 



2, 135. 540. 55 

140,712.10 

37. 860, 64 

3.001.94 

33. 174. 80 



Gallons Percent 



37,534.182 

23, 704, 800 

*82, 278 

5, 905, 704 



67. 062, 408 
4, 656, 288 



71, 718, 696 
844, 932 



37, 534, 182 
325, 285 
739, 576 



38, 599, 043 



Per bbl. 
crude bid. 



1. 2245 
.2096 



Per gal. 
0.0147 
.0147 
1.0.500 



.0001 
.0010 



.0522 
.0454 



2, 3,50. 290. 03 



52, 34 

33. 05 

Ml 

8,23 



93.51 
6.49 



100.00 



Per gal. 
gasoline 



0. 0557 
.0095 



,0097 
, 0.555 



, 05,53 

.0036 
.0010 
.0001 
.0009 



. 0609 



I M. Cu. Ft. 
•indicates red figures. 



10104 



CONCENTRATION OF ECONOMIC POWER 



Cost of making gasoline from skimmings and cracking plant operations 
BARNSDALL REFINERY 



Year 1938 



Barrels 



Gallons 



cntimate Yield From Crude: 

Qpsoline 

Kerosene. .- 

Tractor Distillate 

Rerun Distillate 

Gas Oil 

Diesel Fuel 

Wax Distillate 

Fuel Oil— Industrial 

Fuel Oil 

Reduced Crude 

L Stock, _.. 

Topped Crude 

Gas Residue 



567,731 

33,331 

6,481 

14, 565 

•54, 788 

5.352 

15, 942 

15, 778 

235, 047 

•13, 840 

16,H, 697 

13, 020 

35, 757 



23, 424, 702 

1, 39«, 902 

272, 202 

611,730 

•2,3P1,096 

224, 784 

669, 564 

662, 676 

9, 871, 974 

•581, 280 

6,871,074 

546. 840 

1, 601, 794 



Total Yield. 
Loss 



1,027,973 
73, 430 



43, 174, 866 
3, 084, 060 



Total Crude Charge. 
M. Cu. Ft. Gas 



1, 101, 403 



46, 258, 926 
214, 869 



Gallons Gasoline From Crude (Less Evaporation Losses) - 

Purchased C. n. Gasoline Added— Refinery. _ 

Purchased C. H. Gasoline Added— Pipe Line 



23, 424, 702 

9, 434, 205 

277, 668 



Total Gasoline Produced. 



33, 136, 675 





Amount 


Per bbl. of 
crude 


Per gal. 
gasoline 


Summary of Costs: 

Crude Oil. _ 


1,251,330.48 
130, 341. 99 


1. 1361 

.1184 


.0534 


Crude Oil Transportation..'... 


.0056 






Total Crude Oil & Transportation. . 


1, 381, 672. 47 
107, 626. 76 
169, 380. 18 


1. 2545 
.0977 
.1538 


.0590 


Skimming Plant Costs 


. 0046 


Cracking Plant Costs. 


. 0072 






Total Crude & Processing Costs 


1, 658. 679. 41 


1. 5060 


.0708 






Less: Value of By-Products: 

Kerosene ... . 


58,085.95 

12, 519. 25 

21, 031. 10 

•57, 527. 40 

7, 865. 40 

16, 739. 10 

20,741.76 

10, 692. 30 

164, 409. 16 

•11,625.60 

133, 647. 73 

10. 864. 61 

21, 485. yO 


Per gal. 
0. 0415 
.0460 
.0144 
.0250 
0350 
.0250 
.0313 
.0177 
.0177 
.0200 
.0195 
.0199 
'. 1000 




Tractor Distillate 




Rerun Distillate 




Gas Oil 




Diesel Fuel . 




Wax Distillate 




Fuel Oil— Industrial 




Fuel Oil— Light 




Fuel Oil— Heavy 




Reduced Crude .. 




L Stock ..i 




Topped Crude 




Gas Residue , 








Total By Products 


408, 929. 26 












Deduct Prorata: 

Adv. & Selling Expense 


27, 476. 37 
26, 564. 25 


.0022 
.0021 




Administrative Expense 








Total Adv., Selling & Administrative Expense 


54, 040. 62 












Net Value of By-Products 


354, 888. 64 
1, 303, 790. 77 




.0152 


Cost of Gasoline From Crude (Before Depreciation Including 
Evaporation Losses) 




.0556 








Add: Cost of Purchased Casinghead 


385, 805. 30 
1, 689, 596. 07 

93, 078. 36 
73, 217. 34 
70, 640. 96 


.0397 




Cost of Gasoline After .\dding Casinghead (Before Depr.) 


.0510 


Add Prorata: 

Refinery Depreciation 




.0028 


Advertising & Selling Expense 




.0022 


Administrative Expense 




. 0021 








Cost of Gasoline Delivered (Not Inc. "Q" nor Ethyl). 


1, 926, 532. 73 
40, 453. 97 




.0581 


.Additional Costof "Q"ing 




.0012 






.A-verage Cost of All Grades of Gasoline Shipped 


1,966,986.70 




. 0594 









1 M. (;u. Ft. 
•Indicates red iigures> 



CONCENTRATION OF ECONOMIC POWER 
Chalmette Petroleum Corporation 

REPLY TO item 32 OF T. N. E. C. QUESTIONNAIRE 



10105 



The Chalmette Petroleum Corporation operates only one refinerv The main 
product of the refinery is gasoline. During i 938 the refinery produced in addition 
■to gasoline, Bunker C Fuel Oil and #2 Gas Oil. In determining the cost of gaso- 
line, the fuel and gas oil is priced at the prevailing markets and the dififeren^e 
between the actual cost of these products and the market prices, is either chareed 
or credited against gasoline. The gasoline when sold stands aU seUiug and over- 
fSlrnvs^^^^^^^' principle elements determining the cost of gasoline are as 

(A) Cost of Crude. 

(B) Cost of Casinghead used in Blending. 

l?}^ ^°i^\ "i^'^'ifacturing Expenses at Refinery (Including Depreciation) 
(D) lotal storage Expenses (Including Depreciation on Storage Tanks).' 

ADDITIONAL INFORMATION ON REPLY TO ITEM NO. 32 OF TNEC QUESTIONNAIRE 

From letter of Aug. 4, 1939 to Mr. J. R. Brackett. 
Question No. 32. 

Summary of unit cost 19S8 



January 

February '.V.'.'.' 

March "I"'" 

April 

May... '.'.'...'.'.' 

June: 

Cost low due to blending only 
Ref. down account fire 

July 

August 

September """ 

October. ...~ '"".'.".' 

November I-II!!II"I" 

December 



Gasoline cost 
per bbl. 



$2. 2035 
2. 3049 
2.2856 
2.2565 
2. 3966 

1. 7973 

2. 3863 
2. 4413 
2. 2669 
2. 1221 
2.027 
2.1292 



Fuel oil cost 
per bbl. 



1.95 
.95 

'. 86742 
. 80252 
.80 

.75 

. 75922 

.75 

.75 

.75 

.75 

.76 



Champlin Refining Company 

REPLY TO question 32 OF TNEC QUESTIONNAIRE 

32. We have never made this kind of analysis for the reason that we doubt 
the accuracy of any per gallon cost of separate commodities which To uld be 
thT^Son '°''' ^' ^" "°* ^^^' '^^ ^^"'■^•^ ^^^"^ble with ^Sh to a^wer 



CosDEN Petroleum Corporation 

REPLY to item 32 OF T. N. E. C. QUESTIONNAIRE 

Refinery operating costs for the fiscal year ended April 30, 1938. are as follows: 

Cost of crude oil _ „.. ,., ^-„ „ 

Cost of blending stock::: *'^' ]oi' fSf' o^ 

Cost of asphalt drums ^1?' S ?? 

Direct operating expense 836 022 46 



HicKOK Oil Corporation 



reply to item # 32 OP T. N. E. C. QUESTIONNAIRE 

Answer: None. 



10106 CONCENTRATION OF ECONOMIC TOWER 

Houston Oil Company of Texas 

REPLY to item 32 OF T. N. E. C. QUESTIONNAIRE 

32. Summary cost statement for each domestic refinery operated (a) by the 
reporting company, or (b) by its subsidiaries or affiliates, for the year 1938, show- 
ing the principal elements of cost determining the cost of a gallon of gasoline and 
fuel oil (separately), at the refinery gate (exclusive of any selling expenses). 
Explain briefly the costing policj' followed with particular reference to the method 
of proration of the elements of costs of the refining operations among the various 
products produced. 

Houston Oil Company of Texas, Viola refinery, manufacturing expense-topping stills 



Charged: Mixed Crude 

Direct Manufacturing Expense: 

Labor and Insurance - 

Consumable Supplies -. 

Fuel - 

Repairs — - - -- 

Boiler Station Operations: 

Labor and Insurance..- 

Fuel 

Repairs -. 

Fresh Water 

Miscellaneous 

Prorata chargeable to manufacturing expense 

Laboratory... 

Electricity 

Fresh Water System..". 

Warehouse Operations — 

Pump Station Operations 

Indirect Manufacturing Expense: 

Yard Upkeep 

Fire Protection 

Property Taxes Estimated. 

Processing; Tax - 

Depreciation 

Overhead.- 



Yiela: 

Gasoline. 
Kerosene ' 
Fuel Oil'. 
Loss 



For twelve months 
ending Dec. 31, 1938 



Barrels 


Value 


168, 946. 69 

7, 220. 52 
231.55 
613.29 
187. 64 


$226, 574. 07 


6, 897. 61 
1, 706. 24 
69C. ir; 
1, 160. 78 
1, 020. 34 




11.475.24 




8, 038. 21 
170. 51 
169. 37 
363. 33 
37.68 
245. 16 


17, 277. 26 
10, 210. 90 


2, 944. 48 
1, 255. 87 

102. 25 
36.93 

972. 11 
4, 899. 26 






254, 062. 83 


67, 125. 37 

12, 126. 65 

88, 287. 98 

1, 406. 69 


153,672.57 
20,931.07 
79, 459. 19 






168, 946. 69 


254, 062. 83 



' Kerosene and fuel oil are inventoried at average market (jobbers) listings during the month in which 
produced. The remaining cost is allocated to the production cost of gasoline. 

Kendall REPiyir" '^ompany • 

REPLY TO item 32 OF T. N. E. C. QUE,STIONNAIRE 

Casoline costs: 

Crude Oil Distillation e/gal. 

Crude oil cost allocated to gasoline 4. 7237 

Distillation expense allocated 0. 1 68?. 

Total — untreated straight-run gasoline 4. 8920 



CONCENTRATION OF ECONOMIC I'OWEIt 10107 

Gasoline costs — Continued. 

Gasoline treating: cigal. 

Treating loss - 0. 0483 

Expense... 0. 0740 

Total — gasoline treating 0. 1223 

Total cost of finished straight-run gasoline 5. 0143 

Cracking: 

Charging stock : 5. 0681 

Expense 1. 7016 

6. 7697 
Less: Byproducts 0.8604 

Total cost of cracked gasoline 5. 9093 

Cost of blending and mixing regular gasoline 0. 46 

Cost of blending and mixing ethyl gasoline 0. 8189 

Fuel Oil Costs: 

Crude Oil Distillation: 

Crude oil cost allocated to gas oil 3. 6756 

Distillation expense allocated 0. 1276 

Total - - 3. 8032 

The cost of crude oil and the distillation expenses (including labor, supplies, 
maintenance, utilities, taxes, insurance, depreciation, as well as a portion of 
refinery overhead) are spread over the yield according to the so-called "realiza- 
tion method". Treating, blending and mixing, and cracking expenses include 
those parenthetically enumerated as well as royalty and ethyl fluid costs. 



Lion Oil Refining Company 
reply to item #32 op tnec questionnaire 
Answer: Not available. 



National Refining Company 

reply to item #32 of t. n. e. c. questionnaire 

No costing system has been used. The method of pricing inventories is the 
proportionate part of total refinery expenses attributed to each product, based 
on the total net-back for each product. 

SUPPLEMENTAL REPLY TO ITEM #32 AS CONTAINED IN LETTER OP AUGUST 4, 1939 

The unit prices based on the valuation of inventories of gasoline and fuel oil 
during 1938 for the three refineries are as follows: 

For the Coffeyville Refinery beginning with January, 1938 on thru November 
the prices were unchanged. 

White Rose Ethyl 0.045 per gallon 

White Rose .035" 

Royal . .03 " 

For the month of December 1938 the changes were as follows: 

White Rose Ethyl 0.0488 per gallon 

White Rose. .0412 " 

Royal-. .0326 " " 



10108 CONCENTRATION OF ECONOMIC POWER 

There is no fuel oil in stock at the Coffeyville Refinery. 

For the Findlay Refinery beginning with January 1938 on through Novemhr 
the prices were unchanged. 

White Rose Ethyl 0.063 per gallon 

White Rose ._ ..- .053 " 

Royal - 048 " 

Fuel Oil .028 " 

For the month of December the prices were as follows: 

White Rose Ethyl 0.0662 per gallon 

White Rose .0588" 

Royal.- .04 " " 

Fuel Oil .035 " 

For the Marietta Refinery beginning with January 1938, the prices are as 
follows: 





WRE 


WR 


Royal 


Fuel oil 


January 


0.0875 
.0875 
.0876 
.0925 
.0826 
.0925 
.0926 
.0925 
.0875 
None 
None 
None 


0.0485 
.0485 
.0485 
.0485 
.0485 
.0485 
.0486 
.0486 
.0485 
.0486 
.0486 

.05875 


0.046 

.046 

.046 

.048 

.046 

.046 

.046 

.046 

.046 

None 

None 

None 


0.0286 


February . .. - 


.0286 


March 


.0286 


April - 


.0285 


May - 


.0285 


June . . 


.0285 


July --- 


.0285 


August — 


.0285 




.0285 


October . 


.0285 


November ...— . 


.0286 


December — - . 


.036 







Plymouth Oil Company 
reply to item #32 of t. n. e. c. questionnaire 
See answers to questionnaire forwarded by Republic Oil Refining Company. 



CONCENTRATION 01'" ECONOMIC POWER 10109 

Quaker State Oil Refining Corporation 

supplemental reply to item #32 as contained in letter of august 17th 

Unit prices in valuation of inventories of gasoline and fuel oil at the beginning 
and end of the year 1938 were as follows: 



Gasoline: 

Below 65 Octane 

65 Octane and above 
Etbyl 

Heavy Fuel OU 




12/31/38 



0.0393 
.0.532 
.0583 
. 01966 



REPLY TO ITEM #32 OF T. N. E. C. QUESTIONNAIRE 

The reporting company does not have at any refinery any cost system for 
determining the cost of a gallon of gasoline and fuel oil separately. Depart- 
mental cost figures are maintained only for reflection of department operating 
efficiency. At the cose of the year, the auditors determine the cost of the various 
petroleum products at inventory by method based on sales realization. 



Republic Oil Refining Company 

reply to item 32 of t. n, e. c. questionnaire 

Briefly and summarily stated, materials manufactured are costed monthly by 
allocating among the various products produced that month the cost of the raw 
material and manufacturing costs on the basis of the net back received at the 
Refinery on the various finished products produced. In the belief that it would 
be more helpful, we are enclosing herewith Financial Statement for the month 
of January 1939, marked "See Question 32." 



10110 



GONCENTRATIOX OF ECONOMIC POWER 



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CONCENTRATION OF ECONOMIC POWER 



10111 



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37, 112. 
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10112 CONCENTRATION OF ECONOMIC POWER 

Richfield Oil Corporation 

reply to item no. 32 op tnec questionnaire 

A determination of the separate cost of gasoline or other refined products 
produced at the Corporation's refinery is impossible due to the fact that the 
principal elements contributing to the cost of refined products cannot be allocated 
to the various products produced, except on an entirely arbitrary basis. For 
this reason, no attempt is being made to answer this question. 



South Penn Oil Company 

REPLY to ITEM #32 OP T. N. E. C. QUESTIONNAIRE 

7%e Penmoil Company 

South Penn Oil Company, Triad Oil Company and Bradford Transit Company 
do not operate any refineries, consequently they do not have the data requested. 
As to The Pennzoil Company the following data has been furnished, viz.. 

Summary of Cost Statements, Gasoline & Fuel For Year 1938 

Cost per 
Gallon 

Transport or Third Grade Gasoline $.0500 

Pennzip or Regular Grade Gasoline . 0652 

Ethyl or Premium Grade Gasoline . 0766 

Fuel Oil from Primary DistiUation 8,140,986 gal. % . 0381 

Fuel Oil from Neutral Department 14,967,498 gal. % .0411 

Average Cost of Fuel Oil ._ . 0400 

The above costs of gaeoline and fuel oil have been determined by using the 
"Sales realization method". The processing material consumed in each depart- 
ment was priced at cost. Direct distribution was made of expenses properly 
chargeable to each department. Utility department expenses were prorated 
according to service rendered. Refinery office expenses were allocated on direct 
labor and investment basis. 

Third Grade Gasoline. — The third grade gasoline yield from primary distillation 
totaled 35,067,312 gallons for the year 1938 for which a gross return of $1,747,- 
688.05 was realized. This represented 3* 19% of the gross return of the entire 
yield of the primary distillation which petcentage applied to the total material 
cost and manufacturing expense for the year 1938 plus 50% of the value of the 
distillation loss resulted in a cost of $1,755,367.89 or $.0500 per gallon. 

Material cost and manufacturing expense itemized as follows: 

Crude Oil $5, 371, 880. 11 

Slop Oil 18,977.57 

5, 390, 857. 68 
Direct and Indirect Labor and Expense 306, 985. 58 

Total Cost— Primary Distillation. $5, 697, 843. 26 

Fuel Oil from Primary Distillation. — The fuel oil yield from Primary Distillation 
totaled 8,140,986 gallons for the year 1938, for which a gross return of $317,042.40 
was realized. This represented 5.48% of the gross return of the total yield of the 
Primary Distillation which percentage applied to total cost plus adjustment for 
distillation loss (see third grade gasoline) resulted in a cost of $309,479.51 or 
$.0381 per gallon. 



CONCENTRATION OF ECONOMIC POWER 



10113 



Fuel Oil from Neutral Department. — The fuel oil yield from the Neutral Depart- 
ment totaled 14,967,498 gallons for the year 1938, for which a gross return of 
$582,235.67 was realized. This represented 31.58% of the gross return of the 
entire yield of the Neutral Department which percentage applied to the total cost 
(see below) resulted in a cost of $614,932.71 or $.0411 per gallon. 

Material Cost and Manufacturing Expenses as follows: 

Wax Stock from Inventory $173, 527. 55 

" " " Production - 1,476,860.37 

$1, 650, 387. 92 
Direct and Indirect Labor and Expenses 296, 834. 11 

Total Cost— Neutral Department $1, 947, 222. 03 

PENZIP GASOLINE BLENDING DEPARTMENT 



Products Yielded 


Gallons 
Yielded 


Average 
Sell. Price 
Per Gal- 
lon 


Gross Re- 
turns 


Per Cent 
of Total 


Material 
Cost & Man- 
ufacturing 
Expenses 


Total 

Cost Per 

Gallon 


Revenue: 

Pennzip . 


46,211,013 
251,911 


0. 0618 


$2,856,716.07 


100.00% 


$3,014,311.17 


0.0652 




















46, 462, 924 




2,856.716.07 


100.00% 


3,014,311.17 










Material: Straight Run Gasoline 


20, 910. 967 
546,079 

963, 927 
64,681 

12, 308, 784 

11,668,486 


.0500 
.0687 

.0636 
.0618 

.0633 

.0673 


1, 045, 548. 35 
37, 515. 63 

61, 305. 76 
3,997.29 

779,146.03 

785,289.11 
















Casing Head Gasoline from Pur- 
















Cracked Gasoline from Dubbs #3 








Craelced Gasoline from Dubbs #4 


















46, 462, 924 




2,712,802.17 
301,509.00 








Direct and Indirect Labor and Ex- 
penses . -. 




























3, 014, 311. 17 









ETHYL GASOLINE BLENDING DEPARTMENT 



Revenue: 

Ethyl 


4, 669, 751 
37,969 


.0725 


$338, 415. 77 


100.00% 


$357, 834. 71 


0.0766 




















4, 707, 720 




338, 415. 77 


100.00% 


357, 834. 71 










Material Cost: 

Cracked Gasoline from Dubbs 
#4 Production 


4, 707, 720 


.0673 


316,829.66 
41,005.15 




, 




Direct and Indirect Labor and 






















357,834.71 





o 

a 
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(6) 
Miscellaneous 


feSo^S 


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a 


$233,090.45 

304, 778. 05 

$71,687.60 
5, 555. 99 




5| 

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a 


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Investments in 

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Affiliates 


feSo^S 






i i § i 




1 






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feS-o^S 






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1 



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$27, 890, 577. 46 
7,671,624.28 

66,250.00 
2, 886. 54 










a 1 
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and Equipment.. 
Less: Reserves for 
Depreciation, De- 
pletion and Amor- 
tization - 


1 


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4. Investments and 
Advances in AflU- 
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Unconsolidated 



-11 



10115 



10116 



CONCENTRATION OF ECONOMIC POWKR 



(5) 
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vestments 


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Affiliates 


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a 

3 
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a 










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Branches 


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a 

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s 

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$14,789,623.85 
2, 326, 160. 42 


12, 463, 463. 43 
34.6 

3, 898, 500. 67 
10.8 








a , 


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CONCENTRATION OP ECONOMIC POWER 



10117 



to o> 

1 ■ ^ 


»» 1 1 




CO i 


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J I II 


$205, 295. 76 
322, 946. 43 


toco ■ 
tsTco ' 




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$3, 163, 614. 28 
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$1, 718, 641. 62 
96, 769. 02 


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lo" 


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$2, 236, 038. 85 
413, 136. 63 


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$25, 548, 686. 55 
3, 072, 630. 28 


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$32, 872, 2^7. 06 
4, 060, 491. 42 


$28, 811, 785. 64 
8, 703, 307. 92 

2, 886. 54 
66, 250. 00 


§5S 


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23, 723, 763. 48 
62.2 

3,061,087.39 
8.0 


Assets Used or Em- 
ployed: 

1. Properties, Plant 
and Equipment , - 
Less: Reserves for 
Depreciation, De- 
pletion and Amor- 
tization 


Net--- 

2. Current Assets 

3. Non-current Secur- 

ity In vestments .- 

4. Investments and 

Advances in Af- 
filiated Compan- 
ies-Unconsoli- 
dated 


< 

'E 
1 
c 


11 


"a 
c 
Eh 

00 




ncome: 

1. Gross Revenue 

Less: Inter Depart- 
mental Sales 


Net Gross 
Revenue- -- 
Ratio to Total As- 
sets -%.- 

2. Net Income Before 
Interest and Divi- 
dends-- 

Ratio to Total As- 
sets %.. 



a 5 

8 « 



PS a 



10118 



CONCENTRATION OF ECONOMIC POWER 









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10119 



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10120 



CONCENTRATION OF ECONOMIC POWER 



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(3 







CONCENTRATION OF ECONOMIC POWER 



10121 



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30, 682, 622. 32 


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5,247,081.06 


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$12, 568, 689. 14 
6, 526, 889. 28 


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10122 



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CONCENTRATION OF ECONOMIC POWER 



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OB j 1 




3 

§ 
a 
< 


$35,206,035.79 
3, 626, 795. 97 


c»os 

00 00 

OS to' 

CO -^ 

Nco 

oTtr;" 

ss 

-Too" 

CO 






05r-< 

eo-eo 
loto 


$40,501,689.29 
$34,838,151.13 




•3 60 

g.a 
■as 


fe^-s^S 


to -^ 


2.2 
17.5 

38.2 




t-to 


CO 1 j 




3 
§ 

a 
< 


$11,428,036 32 
3, 491, 064. 97 


7, 936, 971. 35 
6. 558, 286. 09 

34,381.93 




S8 

CO 00 

00 pi 


$15,210,553.23 
$29,300,769.10 




i 

o. 

11 

e 




ei Tf 


O-H 








CO ■ 1 




< 

3 
3 
O 

a 


$9, 140, 805. 89 
3,741,478.47 


^§ 

CO ^H 

oTco 
OS »o 
CO 

o" 






:8 

lid 


$6, 452, 451. 47 
$1. 855, 696. 47 


' 


3 

_o 

o 

3 

1 

PL( 

3 


6?"o^3 


to S 


60.5 
49.8 

21.1 




CMOS 

OS p4 

CO(M 


00 




3 
3 
o 

a 


$264,879,712.91 
48, 784, 733. 80 


216, 094, 979. 11 
18, 668, 769. 98 

18,929.08 




OSiO 

pf 


$236,922,204.64 
$42, 314, 660. 15 




"ca 
o 


^6 


s s 


ss s s 


§8 


8 1:: 




3 
3 
O 

a 

< 


$456,952,300.78 
79, 393, 715. 28 


357. 558, 686. 60 
37, 491, 243. 96 

89, 891. 96 
9, 410, 284. 36 


2S 

pi 00 

OS t- 

^ o 
co"pi 

co« 




$126,658,854.88 
44,164,394.08 










A&sets Used or Em- 
ployed: 
1. Properties, Plant 
and Equipment- - 


Less: Reserves for 
Depreciation, 
Depletion and 
Amortization 






I 

■< 

c 

3 
O 


> 

O o 3 

CO' 


4. Investments and 
Advances in Af- 
filiated C om pa- 
les— Unconsoli- 
dated 


< 

1 
'5 

3 

ce 
.^ 
e 

m 


lis 

^^ 

ll 

Co 

to !■»• 




"a 
o 

00 


Income: 

1. Gross Revenue 

Loss: Inter Depart- 
mental Sales 


o o 

u. a 

C) 3 

■£(5 



CONCENTRATION OF ECONOMIC POWER 



10125 





1 






O 1^ 

CO 

si 










; 






j 






s - 

I-: « 

CO 

co- 
co 

Ol 

u 






i 






1 






i 












i 






1 






I 






CO 

2 




i i 




CO 

1 








20.1 

$14,654,613.05 
3.6 


3 

o 

2 
■ZZ 


2. Net Income before 
Interest and Div- 
idends 

Ratio to Total As- 





25.7 
23.8 


26.1 
9.0 

42.3 
32.9 


05 


i i 


1 ! I ' 


$116,398,576.69 
20, 504. 904. 78 


95,893,671.91 
3,711,120.34 

"i,'954.'i66.'69 
65. 278. 33 


CO 

CO 

o 


J3 : 
B i 
n i 

«» 1 


. . CO Ci 
.1 lO . 
II . IO 

i ': S 

1 1 o 

: i ^ 








i i 








j 


j j 






Mi ill! 




i ! 






$11,488,085.04 


i 


2 ', 
g i 

i 1 


I rt ira 

M i ^ 
! i i 

i ; si 








i : 


; 1 ; ; 






i 




M M 


1^ •«< 


8.5 
24.2 

45.5 

12.6 
58.6 




i i 


i i i i 


$35,021,580.09 
3, 893, 217. 76 


31, 218, 362. 33 
9,961,211.78 

1, 334. 38 

""583,"642.'i5 
116. 244. 23 


00 


OO 1 

s ; 
i i 


1 ; g 1 

1 : «5 1 


in t-^ 


5.2 
14.2 

5.0 

19.7 
.3 


CO 




i i i 1 


$25,562,466.01 
6, 619, 429. 92 


18,943,036.12 
5,876,063.83 

U, 236. 77 

'"'968,'667.'7i 
042. 00 


CO 

■t; 

i 


^ : 
S ; 

g ; 
o I 


1 t^ 

.1 -* 1 

; ; 13 ; 
II -^-F 1 

i i S ; 


03 -^ 


r)<C< . .11. 


c^ 




; ; i ; 


$8. 807, 475. 24 
3, 820, 688. 24 


4,986,787.00 
67,670.79 

is.'oo 


o 

si 


5 ; 

IM 1 

C» I 


$191, 617. 22 
3.8 


59.0 
59.7 


58.8 
52.4 

49.5 

25.4 
8.2 


g 


; ; 




$267,349,920.65 
51,478,090.37 


215, 871, 830. 28 
21,628,022.42 

12, 344, 84 

"'i,'l76,'534.'56 
16, 190. 12 


2 
i 


OC. . 

U i 


$9, 542, 494. 40 
4.0 


s s 


22 § i ;22 


S 


; ! 


i ; i ■; 


.$4.53,140,018.71 
86, 226, 331. 07 


366,913,687.64 
41, 244, 089. 16 

24, 915. 99 

11,488,085.04 

"4,'622,'944. 45 
198, 369. 68 


i 


$142,950,801.92 
49, 148, 071. 17 


93, 802, 730. 75 
22.1 

$17, 088, 277. 12 
4.0 


Assets Used or Em- 
ployed: 
1. Properties, Plant 
and Equipment. _ 
Less: Reserves for 
Depreciation, de- 
pletion and Am- 
ortization 


Net.... 

2. Current Assets 

3. Non-Current Secur- 

ity Investments.. 

4. Investments , and 

Advances in Af- 
filiated Compa- 
nies— Unconsoli- 
dated 

5. Intangible Assets... 

6. Deferred Charges... 

7. Other Assets 


1 
o 
Eh 

OO 


Income: 

1. Gross Revenue 

Less: Inter Depart- 
mental Sales 


Net Cross 
Revenue... 
Ratio to Total As- 
sets %.. 

2. Net Income before 
Interest and Divi- 
dends 

Ratio to Total As- 
sets ...%.. 



10126 



CONCENTRATION OF ECONOMIC POWER 



3 

(3 

09 

o 

to 



fiq 






ot3 
S o 



s 



■as 






III 



££9 



^•5^2 



6?o^^ 



fe^OgnJ 



65"o^2 



"S 60 

«9 



C3 



fe^oeS 






^o^S 






S 



5S S 



00-* 



CO to 

-HO 



50 CD 



tOM 

Odd 



o>o 
ojod 



S5 






e^—i rt 



OOO 00 

t~to 

00 cf 



a 2 



° si nil 
-< 



Bt. 









COCO 

OOTl" 
OOO 
C^OO 



§2 IS 

NO! 

ceo 









•OCDt^ 00 



CONCENTRATION OF ECONOMIC PC)WER 



10127 



i 








1 ° 

i '^ 




So 

i 








J5 

10 












: 




: 








i 




. 








• 00 


s 




















i 












1 












i 




i 












: 








1 




a 








1 












i 












8 












. <3> 


S 

i 

i 
5 












; 












3 K 

i. n 

i. s 


87, 120. 710. 87 
25.8 

$14, 544, 487. 03 
4.3 


Income: 

1. Gross Re venue 

Less: Inter De- 
Dartmental Sales. 




2S 

eg 
>• 

«C: 


<^ 



.22 


2. Net Income before 
Interest and 

Dividends 

Ratio to Total As- 
sets %.. 





10128 CONCENTRATION OP ECONOMIC POWER 

Answer to Request Made in Temporary National Economic Committee's 
Letter of August 14, 1939 for Supplemental Data in Connection with 
Answers Submitted by Consolidated Oil Corporation on July 21, 1939 
to Items 1 1-K (1) and Xh-K (2) of the Questionnaire for Oil Companies 
OF April 19, 1939 

Attached hereto, marked Pages #3, 4 and 5, are analyses for each of the years 
1936, 1937 and 1938 respectively of Assets and Income (on a consolidated basis) 
of the reporting company and its subsidiaries. The following comments are 
explanatory of the methods which have been employed in the preparation of 
such attached statements. 

Analyses have been prepared in the form suggested by the Committee insofar 
as it has been found possible to conform thereto. All of the various amounts 
reported have been stated in units of one hundred thousand dollars, and are to 
be further regarded as approximations to the extent indicated hereinafter. 

For the reason that assets used or employed during the period in question by 
foreign branches engaged in the petroleum industry did not exceed 10% of the 
total consolidated assets, foreign activities have been combined with domestic 
activities. 

Accounting and statistical records of the reporting company and its subsidiaries 
are not maintained on a basis whereby, in all cases, Assets and Income can be 
classified according to actual subdivision between branches or departments of the 
business. Where this condition has been encountered, therefore, the suggestion 
of the Committee has been followed, in that certain assets not specifically allo- 
cable to a branch or branches have been arbitrarily allocated to various depart- 
mental groupings on the basis of the percentage relationship of the amounts of 
gross Capital Assets employed in such departments. In the computation of 
departmental net income, a similar allocation has been made of certain expenses 
not susceptible to departmental subdivision on an actual basis 

As indicated in the original answer to Question 11-K, the functions of refining 
and marketing are performed largely by Sinclair Refining Company (a wholly- 
owned subsidiary of the reporting company), engaged in transportation by pipe 
line, in refining and in marketing. The accounting methods employed by this 
company make possible the statistical segregation of Capital Assets, but pre- 
clude the practicability of effecting a departmental segregation of other assets 
used in refining and marketing. The company's accounting methods similarly 
preclude the allocation, on a departmental basis, of gain or loss resulting from 
such activities. The operation of refining plants by Sinclair Refining Company 
is treated, for accounting purposes, as a component of the integral function of 
refining and marketing. In the attached analyses, therefore, each asset feature 
(except Capital Assets) applicable to Refining, Manufacturing and Marketing 
has been shown as one figure. Related gross revenue and approximate net 
income have, of necessity, each been similarly treated. 

The amounts of gross revenue reported in the attached analyses for each of 
the years in question differ substantially from the gross revenue of the reporting 
company and its subsidiaries on a consolidated basis. In order to display gross 
revenue on a branch basis, it has been necessary to include elements of revenue 
arising from inter-branch transactions, but the gross revenue reported for a 
given branch does not include inter-company revenue arising from transactions 
pertaining to such branch between companies severally engaged in such branch. 

It will be noted that the amounts of departmental net income reported in the 
attached analysis for the year 1938 are not in conformity with the related amounts 
reported in the original answer to Question 11-K (1). These differences are 
generally attributable to the realinement (as compared with methods used in 
preparing the original answer) of certain branch functions in a manner which 
would appear to conform to the instructions accompanying the request for this 
supplemental data; the inclusion in the attached analysis for the year 1938 of 
the results of foreign activities; the arbitrary allocation of certain expenses not 
considered in the original answer; the reallocation of net income of certain minor 
pipe line facilities referred to in Footnote A to the original answer; and the exclu- 
sion from the original answer of the net income of certain subsidiaries which had 
assumed an inactive status prior to the end of the year 1938. 



CONCENTRATION OF ECONOMIC POWER 



10129 



■3s 



alol 
5t5 



=s3 



1^ 



^ 



6S 



6§ 



S S 



S S 

»0 00 

S 2 



8 8 



8 8 



S -^ 



8 g 



8 8 



8 8 



8 8 8 



8 8 



>n oco 



S 8' 



OS 

00^ 



888 

CO CC "3 



82 



8 8 



8 8 

-H CM 



oo 

88 



88 



8 8 8 888^ 



8 8 



t^ »-H -^ ^ 



» « 



>■* O —i 



ooo o>o 



8 8 



a PS' 

» S.2 ^ 
^ S-2 9 

Q ■-€ " 

3 CJ ^ 
■a " " b 

g 3V5O 

O ■""•• 

00 ^ o) Q 
o S^ P 

•a "S^2 
>>..'5fr; o 



M 



J2 H 

■*^ fc: 





go cgbc 

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"I -a- 



c5sa^£|<5 

so S ><!•" luS 

olz; 5 5oo 



^§ o « 
^ « O^-H p o 






W o § 



10130 



CONCENTRATION OF ECONOMIC POWER 



4> 

S 

.9 

a 
o 
O 



S 



C5 






=3 a 

«> s 

u o 






■2^ P 09 



05 t) « "J 



Si 



6? 



6? 



65 



^ 



8 S 



S S 



>Si 



00 e^ 

-^ IS 






8 8 



Soo 



SJ5 



8 8 8 8888 8 



§ 2 



8 8' 8S'8l 




s 



OR; S 1 a 



1 ? « 
■ "OS'S 

'<J Oi? 



H ^ ® S<p S S ® 



--( CO eo 



8 2 



§a> oco 

8" 8" 



8" 8 






g O _ O (U _ 

^ gi o .^ o 

£ Vi 03 OD P OJ 

Sort;? « 



a 



CONCENTRATION OF ECONOMIC POWER 



10131 



S' 8 



8 8 



8 8 






fS8 

88 

CC CO 



S 2- 



888 

OiCOCC 



8 88 8888 



8 88 81 



C» N 



00 •-■ 



8 S 



8 8 



I So 

a gQ- 

S B<2 " 

■§ SSt3 

>" -fcS 

O 03 fe * 

"3, :§ S S 



si 
a.g 
ii 

3 a 



•a — 



1 OT3 

■<ss 



<) 



: CO s o 






'2 I 

SSEf 



I bo S 
® 2 S ® 
■eO-2 »•« 

►Soo 



0? S 03 a> 

•2 ffi.o 



a* ». (B 
-0« 



a o 



124491 — 40 — pt. 17-A 



^^ 



•OT3 ^ 
B O CO 



-12 



10132 



CONCENTRATION OF ECONOMIC POWER 



•^ 



d s 



a Si 






m 

OS e 



2 « " 
■»-> BisE 



oB 






8 g 






88 



a>co 






?S 8 



88 8 



88 



a 

3 

a 

IK'S 

^« 

fc-'-S 

O u. 



'o 3 






» g 



?0 



88 






<S be 



Soap 

Pm J 



:ar=^Sa 
so c 



Saggfe 






S2S 



S^ 



=■ J^oS 



O-^O'^ 



ss?? 



6? ;6? 



-2 

o © 



O ^,-.0 



u CO ® 03 



*o o r*- CO 



s^ 



CONCENTRATION OF ECONOMIC TOWER 



10133 



8 S 



88 



S 8 



8 8 



i 8 



88 

oo 

88 



88 8 8 



18 8 8 



a . 



~ O. a> V «> 



''I 



^§ 






73 03 

It 
03 O 



88 



88 

0>— I 



88 



88 



88 



^^ 



3oa>;<;g 






58S 



S'"8 = 



8'"8' 



8 ;8 



s? ;65 



2 



2 



D 03 '05 

S o 2 o 

>Hah 

U CQ O) CO 

a^ <N 



Mo % 



■z £ 



2 a 



10134 



CONCENTRATION OF ECONOMIC POWER 



at 

SaS to 



I 



08 J5 



2 8 



8 8 

I i 



e<5cd 



oo 



oiri 



88 



S S 



2 g 



S&- 



SS ''^ 



88 



PS 



«A 



sgasQ 



3 « 



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11 
|i 

13 a> 

^S 
en o 

|u ^ 

9 m 08 -I 



;^ 



Kg 



88 






3 M O C 



O <0 O «D 



o>o oo 

o . o . 

O-H o'S 



8:3 8^ 

o . o . 
-to .»s< 



icj o r^ 00 



6?c 



t.05 *<" « 



T 5 



!z: s 



CONCENTRATION OF ECONOMIC POWER 



10135 







ihS 



0136 



CONCENTRATION OF ECONOMIC POWER 





1 


IBJO^JO 


-H 


;-^ I 


28 : , 




jneojaj 


I I 1 












_* 


§ 

a 


(N CO <e> 

06 Jg OS 


s 


<! 


^" ^ 


4L 


mo'i p 


" ;- 1 g : 


— 


■jaaojaj 


I I ' 




coe^coci CON 




0P50 CO Qco 


2a 


s 


to" CO CO 








a 




a 







< 


SI S SI 


^ . . S 


mo%}o 


; ; 1 <N ; 


tmen 
onsol 
petrc 
ffiliat 


jnaojaj 


1 ! ! ' 


a 


M IC ^4 kO •-• to 
M CM M 

10 >o >o 


Inves 
in unc 
dated 
leum a 


a 


TP -fir Tj?" 

CO CO CO 

SI SI SI 


■ CO 


\V%01 JO 


'i^ ' 00 ' CO < 


II 


jaaojaj 


1 1 1 






^g 








t~rt t~.-< 03 


as 


§ 

a 
< 




"Sa 
3 


CM CM 






mo% JO 


' — 1 1 00 ' 

ro '00 . 




a 


jnaojaj 


' I ! 




coco <-< •»*< CO «-t 







a 
3 



S 2 « 






a 














<! 


2 2 ** 


n-i ^ 


lejoi JO 


s ; ; 


K5 1 


1 




jnaojaj 


I I 






^^° 


g~- 












CO 

s 


.9| 


a 
3 


a 



55 


«» 


3 


«fl 


< 






2 










c 


moi JO 


CO 11-1 


CD ' 


a 




jnaojed 


; 


; 




-^ Cl Tf" C> t^ 00 










m 


s 


a 




a 



n 


3 


a 


^ 2 




H 








[e%o% JO 


g :°° ; s ; 




a 



jnaojaj 


■ 1 1 




coot^r^ coco 

,-1 CO "O ,-( »o ^ 














»C ^H 00 CO 




3 




CO cf CO 




















Ph 


a 


|C CO 




























§ :g ; 8 : 




ia30j8ti 


























§ 




H 






a 






•< 








£0 i 


6^l6?5^'fe? 






"SoS 


.«|«„o=^ 






3 


c3 Brt „'-' a 






go « 


s n'S 
















w~ n.o-- w-^jj t;5 












i;0 KOWI? « 






i^ •? • 






g^ J. « 












1 



. 


•^ 


CO 


•0 


1 


>o 


1 


$14, 783, 697 
2, 332, 379 


00 
CO 


oo" 1 

CO r 


SI 

CO 

00- 

CO 








8 


« 








00 


00 


























10 -rf 


s? ; 


CO 


$36, 525, 884 
17, 457, 768 


$19. 068, 116 
$49, 839, 408 


00 

oT 


§ s 


n \ s ; 


CO 


$138,115,061 
52,324,159 


' $85,790, 902 
$39, 913, 053 


3 



CO 


2 § 


2 


00 I 


t~- 


$135, 328, 800 
70, 537, 136 


S 


§ i 

3 ; 
s i 


(N" 

s 


2 g 


00 


'^ 1 


"^ 


$130, 687, 030 
71, 853, 097 


S 

CO 

s? 

00 

10 


So ; 

CO 1 


CO 


ss ;; 


s 


CD 1 


>o 


$241,627,083 
148, 359, 154 


OS 
CO 


5 ! 

?3 i 


5 

Til 


8 1 


s 


II §§ 


8 


$697,067,561 
362, 863, 693 


00 

3 


$149, 509, 387 
8, 851, 730 


s 

CO 
00 

10 


Assets ased or employed: 
1. Properties, Plant and 


Op : 

I'm CO 




•0 
a 

CO 

3 
go 

3 
c4 


|.2 
1 

3,0 

3 m 







CONCENTRATION OF ECONOMIC POWER 



10137 



■^CD CO 



5;2 8"^ ^15 

(N 0» -^ 

O CO ^ 

(N w5 OO 






-^ , O ■ 1-1 



Oi ^ 05 •* 



SI SI 



<C I -H 



t^m to?! 



«»0 lO<D 



-1 N 



00O5 lO C^ 



(MM M<« 



i-H CO 



o> — • r^ »c 



CO O t^ CO 



6 c "o /?, 

1 P H O g 

3 o-g«j fc: 

C^-O o I Q 

W rt « O O 
00*^1 (D „ 

►Ha) I — 5j 

few 'Saras 



^52 



«! 



ggfl 



653 
i"0 



«^« 

a o , 
o -^ 
:3 o w 



•§.2'"' 2.2 

'mrt ©Sea 



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a p 



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a. ^i 

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a M-- p » i2 

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aj Q M aj H HI 

p 0,U, p oX! 

p o S p o 

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3 p O 3 C. cj 



S a 






3 01 3 3 3 S 

•n -^ -> m o t- Oa 



R K 



10138 



CONCENTRATION OF ECONOMIC POWER 



VI 




IB^OJ JO 


M 


»-H 


ro 


« . , 


n 




OS 


•^11 


^ 


*-4 


3 

O 




inaojaj 




; 1 






" 1 








cc r^ 


ZO 


O 1 


o 




CM 00 1 


CO 


cS 




<N •* 


h- 








CM O 




CO 


a 


CO CO 


CS 


S 1 


lO 




t- f; 


CM 


Th 


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3 


or lo 


^ 


■* ! 


■^ 




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u^ 


cf 


o 


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to m 




■^ ■ 








s 




m 


g 


to 00 


CO 


^ 


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CO 


^ 


<; 




^ 


S" i 


& 




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oo" 


n 




IBJOJ JO 








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CM 1 






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n 








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i 


i 






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s 


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la 


3 








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a 


6 








00 


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10146 



CONCENTRATION OF ECONOMIC POWER 



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CONCENTRATION OF ECONOMIC POWER 



10147 









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ll.'4401— 40— pt. 17-A- 



-i:{ 



10148 



CONCENTRATION OF ECONOMIC POWER 



5 o -? 
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O W 





it 




5 i i 









fOCC 
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69 




Elimi- 
nation 
of in- 
tercom- 
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ac- 
counts, 
etc. 


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CO 








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11 




88 


8 
8 




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3 

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General 
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a 
3 


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-3 


Investments 
in unconsoli- 
dated petro- 
leum affiliates 

(2) 


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ICO 


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to 




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1 


a 

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2i 


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(1) 


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Income: 
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(a) Gross Operating Income: 

From Others 

Intercompany 

Interdepartmental. . 


is 
1 

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1 bo 

08 3 




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3 </ 

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a 




3 i^ 
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$198,086 
91, 178 


CDC 

69 


4,798 
4,404 




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8 8 
8 8 


100.00 
100. 00 

100.00 
100.00 




'$198,085 
91, 178 


$106, 907 
60,450 

4,798 
4,404 




t^ CD 


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$114,119 
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3 Investments and Advances in 

Subsidiaries— Not Consoli- 
dated 

4 Investments in Associated 

Companies 



CONCENTRATION OF ECONOMIC POWER 



10149 



8 88 
8 88 



S 8c 






coco 



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8 88 
8 88 



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$112, 992 
34,710 

4.970 


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! 






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100.00 

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100.00 
100.00 

100.00 

100.00 
100.00 

100.00 
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94, 421 


$112,992 
43, 730 

4,970 

8,212 
210 

6,442 
1.661 


1.31 
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-Hid 




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764 


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Assets used or employed: 
1 Properties, Plant and Equip- 
ment . 


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10150 



CONCENTRATION OF ECONOMIC POWER 









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(A) The departmental fi 
s are considered as indep( 

applicable to each depar 
ited Petroleum Affiliates' 










^2£"« 

a^§1 


a 

ID 

•s 


« 1 

M 1 

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■a : 

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e 


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onoperating Income. . . 

Total Oross Revenue. . 
Ratio to Total Assets 


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CM 



CONCENTRATION OF ECONOMIC POWER 10151 

Shell Union Oil Corporation 
50 West 50th Street 

New Yt>RK, September 1, 19S9. 
Mr. James R. Brackett, 

Executive Secretary, Temporary National Economic Committee, 

Apex Building, Washington, D.^C. 

Dear Sir: We have your letter of August 14th requesting additional informa- 
tion in connection with items 11-k (1) and 11-k (2) of your original "Question- 
naire for Oil Companies". 

We have again gone quite thoroughly into this matter of segregating assets as 
well as income on a departmental basis and we attach information which we have 
compiled from our own records and those of our subsidiary companies. 

In connection with the attached analysis of assets, we should like to point out 
that we have had to resort to approximations and estimates in making some of 
these allocations of intangible assets, cash and the like. The attached segregation 
of assets, therefore, is not as carried in our own books of account and has been 
especially prepared in an endeavor to meet your particular request. 

In connection with the request for segregation of gross revenue and net income, 
we must again refer you to our previous letter dated May 27, 1939. Our com- 
panies operate on the basis of a single unit and we do not know of any satisfactory 
basis of theoretically calculating the net income for various divisions or depart- 
ments. 

Yours very truly, 

S. W. DXJHIG, 

Vice President and Treasurer 
SWD-S 
End. 



10152 



CONCENTRATION OF ECONOMIC POWER 






CO 


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PQ 


as 


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CO 


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Investments 
In unconsoli- 
dated 
petroleum 
affiliates 


O 03 

6S2 








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CO 


a 
a 
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a 






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Foreign 
petroleum 
branches 


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10156 CONCENTRATION OF ECONOMIC POWER 

GeOEGE V. HOLTON 

General Counsel 
Stafford Smith 
Austin T. Foster 
Carl E. Kieser 
Loms Mead Treadwell 

Counsel 
Howard M. Park 
William W. Landis 
John Jerome Manning 
Richard^H. Lowe 

Attorneys 

SocoNY- Vacuum Oil Company, Incorporated 
36 Broadway 

NEW YORK 

September 1, 1939 
Re: TNECOIL QUESTIONNAIRE 
Honorable James R. Brackett, 

Executive Secretary, Temporary National Economic Committee, 

Apex Building, Washington, D. C. 

Dear Sir: This is in reply to your letter of August 14th in which you ask for 
an analysis, supplemental to items 11-k (1) and 11-k (2), gf our assets and income 
classified by branches or departments for each of the years 1936, 1937 and 1938. 

For the reasons indicated in our original answer to question 11, to which we 
refer you, we have not found any satisfactory formula which will give us a sound 
and correct analysis of the kind you seek. To make any such breakdown it will 
be necessary to use many arbitrary formulae. Arbitrary departmental allocations 
will not reflect the true relationship of our departments and functions. Our 
business is so completely integrated that it is not logical to consider it as broken 
up into separate parts. 

No profits are realized until the product is finally disposed of; and the price 
which is then obtained establishes the profit for aU activities. An intermediate 
department, such as refining, cannot be said to make a profit by making goods 
and then transferring the inventory to another department at an arbitrary figure. 

Throughout the entire study made by your Committee we have cooperated 
fully despite the burden and expense involved, and it is in this same spirit that 
we are now submitting to you a partial analysis showing those assets which with 
some degree of soundness may be specifically assigned to the departments or 
functions indicated in your letter. The qualification "some degree of soundness" 
has been used because, even in the case of such items as fixed assets, which at first 
blush would seem to be easily assignable to a given function, we find numerous 
instances where plant is being used for two or more functions. To illustrate, 
a tank at a refinery may be used part of the time for refining purposes and at 
other times for marketing storage. We even have cases where certain substantial 
items of equipment are used for as many as three functions. 

We cannot, however, make any allocation or assignment of the general invest- 
ment. For your information, the assets shown in the column "General Invest- 
ments" consist of the following: 

Properties, Plant and Equipment (Less Reserve) . This represents land, 
buildings and equipment used by all the departments of the Company. 

Current Assets. Consist chiefly of general cash funds and marketable secu- 
rities. 

Non-Current Securities. Consist chiefly of investment in and advances to 
companies operating in foreign countries. 

Deferred Charges. Consist of items of a general nature, which are properly 
chargeable against future operations, such as discount and expense on funded 
debt, etc. 

Very truly yours, 

(Written in ink:) Carl E. Kieser. 

CEK:ES Carl E. Kieser. 

End. 



CONCENTRATION OF ECONOMIC POWER 



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CONCENTRATION OF ECONOMIC POWER 



10159 



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Assets Used or Employed: 

1, Properties, Plant and Equipment... 
Less: Reserves for Depreciation, De- 
Dletion and Amortization 




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10160 CONCENTRATION OP ECONOMIC POWER 

C. T. Berqeson, 

ComptToller 
0. M. Perren'ot, 
H. L. Boyle, 

A$sistant ComptrolleTS 

Standard Oil Company (Indiana) 
910 Souths Michigan Avenue 

Chicago, III., September 1, 1939. 

File: CTB 
Subject 
Mr. James R. Brackett 

Executive Secretary, Temporary National Economic Committee, 

Apex Building, Washington, D. C. 

Dear Sir: Under date of August 14th you requested additional information 
with respect to "Questionnaire for Oil Companies." The request deals with an 
analysis of assets and income, on a consolidated basis, of this Company and its 
subsidiaries for the years 1936 to 1938, inclusive. As the preparation of this 
information is entirely an accounting matter, the writer has been authorized to 
reply on behalf of our Company, and attached hereto you will find statements 
as requested. 

As will be observed the break-down of the assets and income by branches or 
departments of the industry is subject to adjustments, such adjustments for each 
year being reflected in a separate column captioned "Consolidated Adjustments 
and Eliminations". This accounting technique or procedure is absolutely 
necessary to conform to correct total income as reported to the S. E. C. and in 
Our published statements. It is appropriate to explain the nature of the elimina- 
tions and the necessity for same. 

Inasmuch as it is necessary to determine the gross revenue and net income by 
branches or departments, cost, transfer price or assigned value for book purposes 
to respective branches or departments must be used in determining cost of sales. 
The large consolidating adjustments and ehminations therefor cover elimination 
of inter-company and inter-departmental profits in inventories and inter-company 
and inter-departmental sales or transfers in order to arrive at the correct consoli- 
dated gross revenue and net income. Likewise, under the assets it is necessary 
to eliminate all inter-company receivables, etc. 

Furthermore, there are always variable conditions in any period of several 
years such as a change in tariffs covering pipe line transportation. Several 
changes occurred during the period 1936 to 1938 and obviously comparisons are 
distorted to the extent of the result of the change. Likewise, a crude oil price 
reduction will have a material effect on the revenue and earnings of the producing 
branch, and differences in billing prices between departments occur for varying 
reasons mainly due to competitive conditions. 

We feel, therefore, that no accurate conclusions can be made but have furnished 
the information as nearly as possible in accordance with your request. 
Yours very truly, 

C. T. Bergenson. 



Standabd Oil Compant (Ikdiana) 

[Temporary National Economic Committee qaeatlonnalre for oil oompuileal 

Analysis of consolidated assets and consolidated income by branches or departments 

YEAB Ilea 





Total after elimina- 
tions 


Consolidating ad- 
justments and 
eliminations 


m 

Domestic petroleum branches 


(3) 




(3) 
Investments 


(4) 




(5) 






Amount 


%of 
total 


Amount 


%of 
total 


(a) Production 


(b) Transportation 


(c) ReSnlng & man- 
ufacturing 


(d) Marketing 


trolettm 
branches 


dated petro- 
leum affiliates 


General Investmenta 


Mlscellaneonl 




Amount 


%of 
total 


Amoiutt 


%of 
total 


Amount 


%ot 
total 


Amount 


7c "1 
total 


Amount 


%of 
total 


Amount 


%of 
total 


Amount 


fssli 


Amoimt 


%0l 
total 


Assets Used or Employed: 

1. Properties, Plant and Equip- 


$654,790,626.83 
307, 287, 600. 60 


100.00 
100.00 






$156,927,940.25 
69, Ml, 954. 82 


23.81 
22.63 


$116,629,790.67 
68, 342, 370. 81 


17.80 
21.69 


$177, 483, 984. 95 
99,057,079.69 


27.11 
33.24 


$176, 729, 146. 37 
67,908,079.93 


26.99 
18.84 
















4.29 
4.70 


Less: Reserves for Depreda- 
tion, Depletion and Amor- 
tiiation 


















14,437,216.35 




347,602,925,33 
206,697,417.50 

110,207,380.91 


100.00 
100.00 

100.00 






86,386,986.43 
4,892,067.75 

61,974.66 


24.86 
2.37 

.06 


50,187,419.76 
2,156,096.08 


14.44 
1.04 


78,426,905.36 
71,985,815.62 

4,308.64 


22.57 
34.83 


118, 820, 165. 44 
60,230,846.63 

628,460.94 


34.19 
29.14 

.57 

















13,682,449.34 
94,648,483.96 

26,000.00 


3.94 




tt7,ll4-89l.5S 
t9!,St9.8S 


IS. 11 
.IS 














3. Non-current Security Invest- 










$109,778,466.66 


99.61 


.02 


4. Investments and Advances 
In Affiliated Companies— 














6, Intangible Assets 


3,190,098.98 
1, 638, 416. 72 
41, 211, 731. 90 


100.00 
100.00 
100.00 










40.00 

184,686.50 

24, 622, 120. 16 


ii.'27 
69.50 


2,201.63 

260, 955. 91 

1,87^,111.91 


.07 
16.93 


1,811,934.79 

666,347.66 

l8H,eiO.S3 


56.80 
40.00 
11.78 














1,376,922.66 

242,256.28 

23,832,259.04 


43.13 


44,955.11 


2.74 


250, 316. 36 
586.518.94 


16.28 
1.42 


















































8. Totals - 


$710, 447, 971. 34 


100.00 


ttr.Sei. 767. SI 


s.ss 


$92, 176, 863. 14 


12.97 


$77, 049, 262. 60 


10.85 


$148,805,661.16 


20.95 


$177,292,116.03 


24.96 










$109,778,466.66 


16.46 


$132,707,370.27 


18.68 


Income: • 


$337,382,676.20 
47.49 

$48,018,851.86 
6.76 


100.00 


tsssMs.niM 


!0B. n 


$32,234,129.88 
34.97 


9.66 


$29,576,391.15 
38.39 

$12,849,406.30 
16.68 


8.77 
26.76 


$191,689,369.81 
128.82 

$24,710,941.13 
16.61 


56.82 
51.46 


$316, 716, 251. 52 
178.08 

M, 688, 7«. 79 
S.IO 


93.68 










$4,903,848.67 


1.4E 
9.23 


$119, G80, 860. 07 
00.18 

$4,360,490.28 
3.28 
















2. Net Income Before interest 


100.00 


tl,S9S,S9e.!0 


S.OO 


$9,762,696.83 20.33 
10.69 


11. 8i 










$4,430,878.31 
4.04 




Ratio' to Total Assets %.. 



























Assets Used or Employed: 

1. Properties, Plant and Equip- 


1692,120.714.22 
320, 534, 679. 32 


100.00 
100.00 






$179,863,691.47 
73,334,267.05 


26.99 
23.03 


$118,163,139.80 
66,835,275.44 


17.07 
20.86 


$187,650,461.16 
104,805,138.76 


27.10 
32.70 


$179,667,731.63 
60,620,607.31 


25.06 
18.91 














$26,886,700.17 
14.439,600.77 




Less: Reserves for Deprecia- 
tion, Depletion and Amor- 










































371, 5S6, 034. 90 
208,171,058.64 

109,261,295.51 


100.00 
lOOOO 

100.00 






106, 029, 434. 42 
6, 778, 394. 28 

160,264.71 


28.63 
3.26 

.14 


61,327,864.36 
1,641,934.54 


13.81 
.78 


82, 745. 312. 40 
76,700,033.97 


22.27 
36.41 


119,037.224.32 
66, 839, 628. 23 

860,428.06 


32.04 
32.11 

.78 














12,446,199.40 
84,327,287.65 

23,000.00 






tn.tos.m.Ds 

418,000.00 


is.or 

.S8 










$108,646,612.76 


99.44 




3. Non-«unent Security Invest- 


.03 


4. Investmentsand Advancesin 
AmUated Companies— Un- 






















3, 107, 880. 98 
1,662,564.82 
41,290,361.46 


100.66 

100.00 
100.00 














2,169.23 

275,169.35 

1,840,101. 81 


.07 
16.66 


1,811,934. 79158.30 














i,293,'786."07 

201,290.44 

23,832,403 09 






33,i86.63 


2.00 


457,055.90 
622,676.67 


27.40 
1.27 


47,438.92 
24, 636, 007. 50 


2.86 
59.43 


















4, 781, 431. 91 


H.SS 














55.29 






















8. Totals - 


$735,079,170.31 


100.00 


tir,B90,93S.W 


S.71 


$113,937,814.98 


15.50 


$77,664,145 32 


10.55 


$166,972,472.09 


21.35 


$184,436,097.02 


25.09 










$108, 645. 612. 76 


14.78 


$121,123,967.66 


16.48 


Income: 


$373, 836, 665. 29 
60.85 

$57, 702, 740. 83 
7.85 


100.00 


(371,381,805.97 


100.41 


$41,822,612.86 
3&71 

$13,724,270.04 
12.05 


11.19 
23.78 


$31,303,616.30 
40.36 

$13,697,868.81 
17.66 


8.37 
23.74 


$207,294,632.67 
132.06 

$18,880,364.74 
12.03 


66. 45 $338, 531, 335. 09 
183.65 

33 73 $3,294,296.20 
1.70 


90.66 










$6,624,803.86 
6.00 

$5,733,601.28 
5.28 


1.76 
9.94 


$123,742,571.59 
102. 16 

$2,669,984.01 
2.20 


3,1.09 














I Net Income Before Interest 

and Dividends 

Ratio to Total Assets ....%.. 


100.00 tiST,en.ts 


.SO 


6.71 










4.61 























Assets Used or Employed: 

1, Properties, Plant and Equip- 


$714,798,958.47 
341,389,137.96 


100.00 
100.00 






$196,161,097.89 
83,620,001.92 


27.30 
24.49 


$119,933,173.29 
69,324,736.28 


16.78 
20.28 


$184,384,786.88 
104,389,400.81 


36.80 
30.58 


$181,880,307.56 
04,105,441.01 


3&45 
18.78 














$33,430,693.86 
20,049,567.04 


4 67 


Less: Reserves for Deprecia- 
tion, Depletion and Amor- 
tization 


















5.87 


Net 


373, 409, 820. 61 
211,858,082.88 

109,366,230.28 


100.00 
100.00 

100.00 






111,541,095.97 
4, 516, 426. 32 

19, 827. 06 


29.87 
313 

.03 


60, 708, 437. 01 
1,659,177.32 

60, 000. 00 


13 68 
.78 

.04 


79, 995, 385. 07 
46,667,027.31 


21.42 
21.50 


117,783,865.64 
61,607,606.62 

776,639.12 


31.54 
29.08 

.71 














13,381,036.82 
116,316,639.31 

23,000.00 


3.59 




$17,896,893.83 
811,000.00 


8.35 
.18 














,54,86 


3. Non-current Security invest- 










$108,807,764.10 


99.49 


.02 


4. Investments and Advances 
in Affiliated Companies— 


















3, 078, 670. 14 
1,813,260.63 
26, 137, 177. 81 


100.00 
100.00 
IQO.OO 














2, 201. 60 

224.882.38 

1,718,681.10 


.07 
12.40 

.6.88 


1, 811, 936. 79 

693,734.47 

4, 74t, 079. 08 


68.86 
38.26 
18.88 














1,264,431.76 

201.600.49 

6,702,271.96 


41.07 




39,340.77 


2.17 


610,524.76 
613,73L37 


33.67 
3.04 


43, 177. 67 
24,391,836.84 


2.38 
97.03 
















7. Other Assets ., 














26.67 


8- Totals 


$724,663,141.96 


100.00 


tn, 988,363.08 


1.48 


$117,200,605.47 


16.17 


$76,862,627.84 


10.61 


$124,060,913 79 


17.12 


$177,931,703.58 


24.66 




n 







$108,807,764.10 


15.01 


$137,787,880.23 


19.02 


Income: 

1. Oross Revenue 


S341, 206, 403. 64 
47.08 

$28,467,977.69 
3.93 


100.00 


$SSl,8St,08tM 


106.04 


$37,095,304.14 
31.65 

$8,604X63.34 
7.34 


10.87 
30.23 


$28,840,649.43 
34.92 

$10,932,740.89 
14.23 


7.87 
38.40 


$204,926,697.07 
165.20 

$2, 482, 984. 33 
2.0O 


60.06 
8.72 


$316, 509, 269. 74 
177.88 

$% 932, 020. 45 
1.66 


92.76 










$4,363,931.60 
4.01 

4,211,011.82 
3.87 


1.28 
14.79 


$113,302,719.12 
82.23 

4,t81,68t.94 
S.tl 


33.20 














2. Net Income Before Iiitoest 
and Dividends 


100.00 


$3, 588, 749. 91 


12.61 


10.30 










15.04 


Ratio to Total Assets- % 

































Italics Indicate red figures. 



124491 — 40— pt. 17-A (Face p. 10160) No. 1 



CONCENTRATION OF ECONOMIC POWER 10161 

Sun Oil Companv, 
Philadelphia, Septemler 1, 19S9. 
J. Howard Pew, 

President 
J. N. Pew. Jr., 
Vice President. 

Temporary National Economic Committee, 

Apex Building, Washington, D. C. 
Attention of Mr. J. R. Brackett, Executive Secretary. 

Gentlemen: We very much regret the delay in making reply to your letter 
of August 14th. This, however, was occasioned by the inability of our staff to 
furnish the information you requested in the form indicated. 

In a mass production industry it is impossible to accurately determine the 
income that accrues in any particular branch or division. None of the several 
arbitrary methods for determining the effectiveness of interdepartmental opera- 
tions is of value excepting only for purposes of comparison, and no two such 
methods produce like results. The very breaking down of the industry into 
divisions is purely arbitrary, as no two integrated companies would agree as to 
the activities that should be allocated to each division. In the ultimate deter- 
mination of our profits or losses we take the total amount of money received 
from the sale of all our products and from this deduct all our operating costs, 
including those of transportation, and the difference is our profit or loss. 

As regards the analysis of consolidated assets covered in the form which you to 
sent us, it is obviously impossible to break down the cash in the banks so that a 
part of this cash should appear as a credit to each of these arbitrary divisions. 
The same reasoning applies to practically all current assets. 
Very truly yours, 

J. Howard Pew. 



The Texas Company 

regal department 

135 East 42nd Street 
Qeorgw W. Rat, Jr. 

New York, August 28lh, 1939. 
Mr. James R. Brackett, 

Executive Secretary, Temporary National Economic Committee, 

Apex Building, Washington, D. C. 
Dear Sir: Your letter of August 14th to The Texas Corporation has been 
referred to me for reply. 

It is impossible to compile the data you request by September 5th, 1939 or 
by September 18th, 1939. 

Furthermore, the information requested involves the use of so many arbitrary 
assumptions that the information when compiled, in our opinion, would be 
valueless. 

I assume that in view of this you will withdraw your request for the additional 
information. 

Very truly yours, 

George W. Ray, Jr., Attorney. 
GWR-ARL 



10162 CONCENTRATION OF ECONOMIC POWER 

Tide Water Associated Oil Company 
tide water division 

17 Battery Place 

George T. Mukray, Jr. 

Assistant to the President 

New York, Septemher 8, 1939. 
Mr. James R. Brackett, 

Executive Secretary, Temporary National Economic Committee, 

Washington, D. C. 
Dear Mb. Brackett: Referring to your letter to me of August 17, 1939 and 
our recent conversation regarding this Company's unit value of gasoline and 
divisional profits desired by the Committee. 

I believe I made it sufficiently clear to you during our conversation that our 
Company, as well as all other oil companies, considers it impossible accurately 
to determine the cost of a gallon of gasoline or other products manufactured 
from crude oil. Recognizing this fact, you have indicated, that your purpose 
would be served if we informed you of the unit value of gasoline used in con- 
nection with the preparation of our annual return of taxable net income. Ac- 
cordingly, we send you herewith a statement giving the information desired by 
you, and I hope that the Committee will accept and use this information with 
our qualification that the unit values represent estimates prepared for the pur- 
pose of valuing the Companies' inventories of gasoline and that we do not present 
them as actual costs of gasoline. 

We have again carefully considered what information might be given to the 
Committee indicating divisional profits of our Company. If in my conversation 
with you I failed to make it clear, please be advised that our Company has not 
adopted and is not using an accounting system designed to reflect profits by divi- 
sions. The development of such an accounting system has been considered by 
our executives from time to time but it has always been recognized that the profits 
of the divisions of an integrated oil company can only be estimated by arbitrarily 
assigning to each division a profit on products or services supplied to other divi- 
sions of the Company. Another circumstance making it impracticable in our 
opinion to determine divisional profits is the fact, as you will appreciate, that 
several classes of important assets and liabilities, and carrying charges, cannot 
readily be apportioned and allocated to the various operating divisions of the 
Company, although all divisions share in such assets, liabilities and carrying 
charges and would have to consider them in determining divisional profits. Also, 
we consider that it is impossible to determine what proportions of the capital stock 
and surplus of the Company may be said to be employed by the various branches 
of our Company. Therefore, for the foregoing reasons, our executives have always 
believed it impracticable to determine a basis for such inter-divisional profits, and 
for that reason the income of the Company is determined and considered only on 
a consolidated basis for the Company as a whole. It has always been thought 
that an inter-divisional profit system would be meaningless and of no value by 
reason of arbitrary assumptions necessary for the computation of divisional profits. 

For the foregoing reasons, I regret to advise again that we cannot give you any 
information regarding divisional profits. Please be assured that we wish to co- 
operate with the Committee in its investigation, but we cannot furnish the re- 
quested information because it is not available and we know of no practicable 
manner in which to prepare it. 
Sincerely yours, 

Geo. J. Mvkray, Jr. 

GJM:RR. 



CONCENTRATION OF ECONOMIC POWER 10163 

Union Oil Company of Caufqrnia 

Union Oil Building 
W. R. EnwARiis, 
Secretary. 

K. H. EsTii.L, 

AssiftaTit Serrelary. 

Los Angeles, Calif., September 6, 1939. 
Mr. James R. Braokett, 

Executive Secretary, Temporary National Economic Committee, 

Apex Building, Washington, D. C. 

Dear Sir: In reply to your letter of August 14 asking for an analysis of assets 
and income for the various departments of the Company for the years 1^36-38 
inclusive, and with reference to our letter of September 1, we are attaching sched- 
ules showing the information requested insofar as it is practicable for us to furnish 
it. 

Generally, the form of the report suggested by you is satisfactory except that 
we have added an additional column, "Unallocated", in which we have placed 
current assets and net income. Current assets consisting of cash, accounts and 
notes receivable, inventories, materials and supplies, have not been allocated to 
departments as we see no reasonable way in which such allocation can be made. 
The company operates through departments rather than separately incorporated 
companies for each departmental activity, and, further, our accounting system 
does not provide for departmental allocation of the current assets which might 
be required by each department to carry on its current operations provided it had 
to separately maintain itself. Physical properties, v/ith applicable depreciation 
reserves, have been segregated in accordance with departmental classification. 

Gross revenue has been segregated according to departments to show the reve- 
nues obtained by such departments, as transportation where services are performed 
for other parties. Gross revenues from sales of crude and refined oil products are 
shown under the marketing department. Net income (as specified before interest 
and dividends) has been placed in the unallocated column. While in the main it 
is true that all departmental activities enter into the realizing of net income, it is 
impracticable, if not impossible, to determine to what extent each department 
contributed to that net income; further, no so-called departmental profit can be 
considered realized until the products are finally sold by the marketing department. 

We trust the attached statements, together with the explanation above, will 
satisfactorily answer your questions. 
Very truly yours, 

W. R. Edwards, Secretary. 

S. 



124491— 40— pt. 17-A 14 



10164 



CONCENTRATION OF ECONOMIC POWER 



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o 


u 




-W 


z 


s 


o 


a 






z 


ec 


t) 


CO 



^ -22 



02 
'-a 

■as 



S . a 

S § » 3 « 









§22 









§s2 



2 a 

§■2 



CM M 

GO ui 

00 T}< 



§ s 
s 2 



s s 



8 2 



|2S S 









2-3 o 



>'o a 

^■< a 

BJ « C o^ 

ffl-Si2_-2-<J.a. 






3 ca S OS 
go§2o 

«£gQ2 

a> i-t o3 ^ ^ ^ 



iO CO ^* 00 



CONCENTRATION OF ECONOMIC POWER 



10165 





1 1 






1 








11 






I 








•o 






i s 

I o 

1 3 




i S 
• o> 
















i i 










i '^" 


«f 






is 


; t2 g 

1 »^ o 




















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i i 






; § g 




i S 2 
















[ 




i : i 
















u 




i S 2 








' i i 












i 










e«f ^ 


! 








s 










i i 


i 


















i 1 


s 

00 








1 g s 

1 i-^ CO 

oo" « 

1 •- QO 








i i 


; 








i 










S 5 

m OS 


s 








oT 










i i 


i 








■ 










^ 1 s 

u 5 


s 

2 








11 « 

2" '^ 








i i 


; 


















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^* 

of 




































§ 

i 2 




i^ 


to S 


1 




a 
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a- 

« 

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•g 

i< a 


1 


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c 
c 

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II 

a 1 
a 

S ; 

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ga 
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CO 


Sa i 

§.£ i 

lIJi 

sill 


32 
III 


1 
o 

00 


<s 

3 

a 

1° 

5 


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o 
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o 


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a 
1 

ii 

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to oa 


■< 
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o 

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•Or: 
P o 



50 



.as 



$0Q 

a-s 



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J5 
g-o 

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o 0. is 

= o2 
« o 3 

2:25 
asR 






:^5 






2 >>5 u 



ii H (E H t)«> 
. O Bfi.S o ai 

--" =1 0=3 « 

<n □ !» n 03 te 

sa»3«^ 

jO <D S * 

oS-S^gS 




a 03 o afc.'o 

"a S: » H •< 

O O S^ > 3 » 
bCti SS ^ n '^ 

'E ° 25 a *- *j "2 

■^ Q] 0^ O) ^^ TTT Q 

o q-O-O 03 S~ 

^ So " t> g-S.s 



10166 



CONCENTUATION OF ECONOMIC POWER 



1 
1 

a 


S23 


























1 












< 1 








r-" 


















!■ 




(5) 

Miscella- 
neous 


























; 












a 
§ 

a 


cm" of 


S 












01 


^ 








(4) 

General In- 
vestments 


§25 
























J 


i 








3 

c 

a 













10 CO 








00 


s 








(3) 

luvestmcnts 
in Uncon- 
solidated 
Petroleum 
Affiliates 


5^2 














1 










j 








a 

3 


a 
< 














2 








2 


s 






- 


(2) 

Foreign 
Petroleum 
Brauches 




































a 
3 


a 
< 


CD OS 


c5 














2 












(1) 
Domestic Petroleum Branches 


!^ bc 


m 




; 


























S5 a 
1 


o» 

t^ CO 


CO 

00" 














OS 

oo" 


i 

CD 








sr 1 

■3g.9 
3§ 


3.0-3 




i 














; 










- 


n 
3 


a 


«0 CO 


00 














00 

00 

'OS 












^il- 




[ 
























c 

3 


a 
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01 


n f3 


i 














i 


00 








l§ 


a 

3 


a 




j 














: '. 








•c 00 






















- 




II 






















1 

; 1 








" 


a 

3 

a . 


i 2 


COCOiO « 
Oit^ Oi CO 

— rt> 






CO CO 

cr; 00 
05 -r 

io' 00 
CO t^ 










Assets Used or Employed: 
1. Properties, Plant and Equip- 
ment 


o'a 
-2.S 

'o.S 

|i 

^^ 
0) <s 
ta 

a> 

|i 

I-' Q 
KJ * 




1 


c 



c 

1 

> 

a> 
tn 

r 

a 


CO 


5(3 

gj 
> a 

B.S? 


< 

£ 

i 

c 


C3 

x: 


T3 

fc 

CD 
C 
CO 












C 

t- 
Oj 

BO 

8^ 
a 




£h 


.0 
a 


i 

a 

£ 


^^ 

if 

So 

4) CO 

Z 


< 

a 


5 
.0 

a 








^Si 



|2- 



('ONCENTRATION OF ECONOMIC POWIOR 



10167 



(5) 

Miscellane- 
ous 


6?"oi2 












\ 






a 
s 
o 

a 
< 


















(4) 

General Invest- 
ments 


ort 
6SS 










8 ; 






1 

a 1 

a 

o 

a 










$95. 593. 00 






(3) 

Investments in 

in Unconsolidated 

Petroleum 

Affluxes 


6S2 












8 ; 




c 

3 

O 

E 

< 






i 






8 ; 

I 

I i 




(2) 

Foreign 
Petroleum 
Branches ' ' 


S^oSS 


















a 

O 

a 
< 


















(1) 
Domestic Petroleum Branches ' ' 




^o£3 



















3 
o 

a 
< 
















-: 


3§ 


6§o oa , 
















3 
o 

a 
-< 




















6§oc3 


















a 

3 
o 

s 

•< 


















(a) ProduLcion (in- 
cluding natural 
gasoline opera- 
tions) 


05 


§ § 


g§ 






8 


a 

. ' 3 



a 


$42,345,735.20 
31, 919, 660. 86 


000 

li 

010 












s s 


Sg S §88 




"3 


a 

3 

i 


$42, 345, 735. 20 
31, 919, 660. 86 


$10,426,074.34 
5, 420, 877. 64 

95, 503. 00 
< 567, 000. 00 










^1 


Less: Reserves for 
Depreciatic, De- 
pletion, Intangible 
Develonment. etc. . 


^ 


1 


1 >^ 

. 3 

. 

: a t 

3 01- 

An 


4. Investments and Ad- 
vances in Affiliated 
Companies — Un- 


5 6 

a c 


s 

as 

.a 


13 

G 

>CO 



ea ^ 

ra a 
■o o 

«T3 
— 4) 
3 S 

(o a 

J3^ 

a 2 

t3 D. 
(U o 

C32 

0.0 

li 



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&8 
03 



Sa 

feo 



=3 ^< 



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OS 



0/ o 



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a5 3 



3 . -r-S 



a a 



a a 



a >» - 
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bOTS d 

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bit-— O 



sSo 



^ o '-a a> g 

a 2 .Q <u ti 

is liil 

-III 

3 b to "• 
0S.2 S"^ 

c'O « 3 
^^S 3 03 

aaatu 
2: g£.9| 

Ma 5=3 :i = 

s 3 a55 s o 

^ o 9 u o > o 
a ja .2 a a a ^ 
1— ■" -^ '-I i-i i-i > 



'■K 



10168 



CONCENTRATION OF ECONOMIC POWER 







h 


^o ©2 






1 








1 


to 




















a 
g 




















s 


< 




















, 






s 


g 


- S 


























s 


6§2 






'"' 






2 




H j2 
















8 
i 


600.00 
1.38 

500.00 
1.38 






a 


a 




w^- 


,-7 .M 






O 


■< 




s^ 


CO CO 






■o 


•fc---. 




s 
















a2 


o eg 
















entsi 
solida 
eum 
ates 


6S2 




















s 












CO 


nvestm 

Uncon 

Petro 


a 
a 
o 

a 
< 




JR 














>-> a 




<^ 
















— 






•» 
















qS" 


6? 0=3 




















Bgs 


































s 




^j? S 


p 
§ 

s 
< 






















6?o05 










































"2 K. 






















<a M 


a 




















S-S 


3 
o 




















s 


s 


















6§"o 25 
















1 

a 




















i^S 


<5 
















s§ 


6§o05 


















2 

u 


51 


a 

3 
o 

a 
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1 




























a 

o 

Q 


a g 
"^2 2 


652 


8 


O C6 


S 








■g 




S 


S SS S2 






3 M® 


a 

3 




i § § 






^^■5n 


o 


CO' 


00 o of 






^ a i o 


a 




S f-i 00 
























«^ 1 M- 








«l 


8 


8 .8 ; 


8 1 
























£s 
















SS^ 82 










a- 








5 


.«» 




Q 


o * •-J ' 






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§ 


s 


H 


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Cf CO 








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•^ 


IK 

to- 




^, 


-^-wrr. 








»=• 












a i 






< 










° P OJ 


•^ 


venue 
Total 
ome 
t and 


"3 
o 










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I ^sB^^s 










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go 2 n o 










M-a.S 


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o&O 


gOPSZ « 










00 £ 


c^ 8^- c^ 1 




















•< 












1 



r 






I 


















8 








8 

uS 


















































































8 8 


88 ; 


$48, 354. 329. 05 
36, 669, 518. 06 


05 to 1 

o to I 
«co 1 

Tjf-,- ! 


8 8 


88 8 


$48,364,329.05 
36, 669, 618. 06 


$11, 684, 810. 99 
6. 131. 336. 69 

95, 593. 00 


Assets Used or Employed: 

1. Properties, Plant and 

Eriulpment- 


l^css: Reserve for De- 
preciation, Deple- 
tion. Intangible 
Development, etc.. 




•< 

a 
g 

3 
O 

pi 


i ! 

a a 
2 



CONCENTRATION OF ECONOMIC POWER 



10169 



iciira 
In 00 



8888 



'e^od 
.CO to 
'OS to 

I OS to' 

CO 



aw a;= .a -o S 
*» 3 B ° '5 " 
SSoHgSfe 

5 Sqo 



iS 



8S 8?? 



Mot 

tn <uQ 

S o a * 

® S M 

<c k. ea SJ'-H'O 08 
o . 















































J 
































8 










S 


s 
















8 
i 

to- 
es 










8 

i 


$118,350.00 
1.24 

118,350.00 
1.24 














8 








. OS 

CO 
























8 








8 




























































































































































































































































































8 I 


88 






88 


s 

to 

C3S 


OS 
OS 


OS 


■ 


$51, 622, 753. 85 
40, 031, 325. 19 


COCO 
'd* to 

538 

to to 








o 

i 

CO 
CO 


$12, 523, 751. 28 

.77 

1 516, 136. 11 
.09 


8 8 


88 8 8888 


8 


8 


8 




$51, 622, 753. 85 
40, 031, 325. 19 


$11,591,428.66 
4, 590, 699. 31 

95, 593. 00 
« 669, 000. 00 




o 

i 

s 

Si 


$12, 642, 101. 28 
.74 

1 634,486.11 
.10 


■S'H 

» » D 

t)ow 


Less: Reserves for 
Depreciation, De- 
pletion, Intangible 
iDevelooments. etc.. 






1 

< 

c 

t 

S 

O 


1 

9 
c/. ill 

c £ 

11 
Z 

CO 


4. Investments and Ad- 
vances in Affiliated 
Companies— Un- 
consolidated- 


1 

< 

'5 
a 
s 

c 
to 


i 

.£3 

o 

■a 

c 

to' 


1 

■< 

k. 
HI 

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O 




1 

00 


c 
a 

■A 

ao 

o . 

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< 

o 
o 

03 


O M 

♦J o » 
aji-co 
I? 


1 

< 

o 
E- 

o 

_o 

a 





o a 
a o! 



OS 


o. 


d 


T3 


Si 


a 


> 

a 


_o 


hH 


> 


■* 


0) 



10170 



CONCENTRATION OF ECONOMIC POWER 











o 


o 


mo V 


© « » ® 


» 


(D I e i 






.2*1 

sis 


a 


3 


3 3 a 


3 3 3 3 


3 


3 ; a ; 


iS- 




o 


o 


o o o 


O O O O 


o 


o o 




2: 


^ 


zz z 


??;:z;a:a: 


z 


z \ z I 








o3 


!>., 


o> 


coto to 


; s 


« ~ 


00 . -H . 








O 


oo 


Olt- 00 




rH 1 00 . 




£| 

a 


^g 


53 


e4 

CO 


coto «^ 

rt CO -* 


is^'s 


§ 


1^ ; to 1 

•«»< 1 eo 1 




00 


as 


§3 g 




j:; 


NOS coto 
»c r^ 0000 


-*?» 


□ 

3 
O 

B 


c^ 


lO 


^* •-( 00 
ooco t~ 

to »0 00 


1 CO t^ to 

.OlOOM- 
• O CO 00 

l«5COtC 


to 


too o c^ 

00 to"^ 




V 


o 


o 


CO to iO 




Ob 


-H CO 




O 


<1 




t» 


aurr m 




t^ 


00 rt 










■'" 


N 


rt'rt 




co" 


•* 








, 






1 1 ^i* 




■ ^< 


•^ . o . 




aT3 


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1 1 r-l 




CO 


t^ 1 CO . 


g 


stments i 
msolidate 
troleum 
fflliates 


,^°^ 






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1 i i 


e4 


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3 






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o . . 




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a> 1 0) . 






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3 


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3 


a ' a ' 






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leum 

Branchi 


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o o o 


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o 


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c^ 




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3 


a 


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3 3 3 3 


a 


3 ' a ' 








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o 


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z 


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z 


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M 


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1 • t^ 




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CO 


CO^" r 


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cs""* rt'*"* 




gS 


c: 


-rf 


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»0 1^ 1 


1 iCS 


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lO «o 




c3 


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r~<N 1 




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a 

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to 


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to 00 1 




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to 




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to « 1 




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a 


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to 






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to 


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a 
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to 


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cs 


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o 




c 


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05 


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ed or Em] 
erties, P 
uipment. 
: Reserves 


.s 


Net 

ent Asset! 
current S( 
jtments .. 
slments 
Qces in 


1 ;jgfe 




3'3 _ Pffl 








11 

.2"*! 


Companies 

idated 

it.ingible A 
eferred Ch; 


s 


s Revcn 
to Tot 
Income 
est and 
To tot 










0.3 


C a o ^ a 


o 


J^t Ih CC CJ ■*-» cJ 








iSPn hJ 




^oc 


&-> 


go«2: « 








S-v 




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,— .'-^^ 


s ^^ 


o,-^ ,-. 












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00 


© .-1 CM 










< 










3 



CONCENTRATION OF ECONOMIC POWER 



10171 





® m 


0) 


0) 


» 




a> 


0) e SI 




CD 




0) 


1 a> 1 . 


a a 


o a a 


a a a a 


a 


a : a ■ 


o o 


O O O 


o o o o 


o 


o o ■\ 


^ 'Z 


;s2; ;s 


ZZZZ 


z 


z \ z \ 


S g 


t5S S 




SS? 


§ 


R ;. § ; 


8 S? 


COOCJ CO 

1-I Tj< Tj* 


igSli 


8 


OS 1 CO I 

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CONCENTRATION OF ECONOMIC POWER 



10177 



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10183 























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10184 



CONCENTRATION OF ECONOMIC POWER 



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CONCENTRATION OF ECONOMIC POWER 10185 

CosDEN Petroleum Corporation 

PRODUCERS AND REFINERS PETROLEUM PRODUCTS 

Fort Worth, Texas, September 6, 1939. 
Temporary Natl Economic Comm., 
Congress of the United States, 

Apex Building, Washington, D. C. 
(Att: Mr. Jas. R. Brackett, Executive Secretary.) 
Gentlemen: We enclose Analysis of Consolidated Assets and Consolidated 
Income of the Cosden Petroleum Corporation for the fiscal year ending April 30, 
1938, as requested in your letter of August 14. 

Under the "Miscellaneous" column in this schedule we show investments that 
are not applicable to any individual department but which are used directly and 
indirectly by all departments as each department does not maintain a separate 
accounting system. These assets, of course, may be prorated to the Production, 
Transportation and Refining Departments. 

We trust that this information will be satisfactory. 
Very truly yours, 

Cosden Petroleum Corporation, 
j. w. burrbll. 
JWB: ACB 
Enc. 



10186 



CONCENTRATION OF ECONOMIC POWER 



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CONCENTRATION OF ECONOMIC POWER 



10187 



Dan Danciger, 

President 



Joseph Danciger, 
Vice President 



Jack Danciger 
Vice-President 



A. Danciger, 
f^ecy. <t Treas. 



Danciger Oil & Refining Co. 



A CORPORATION 



Offices 14th Floor, W. T. Waggoner Bldg. Address Reply, P. O. Box G70. 

Fort Worth, Texas, Seplember 6, 1939. 
Re: Items il-k(l) and n-k(2) of the "Questionnaire for Oil Companies" 

Mr. James R. Brackett, 

Executive Secretary, Temporary National Economic Committee, 

Congress of the United States, Apex Building, Washington, D. C. 

Dear Sir: We wish to acknowledge receipt of your letter of August 15, 1939, 
requesting an analysis of the assets and income (on a consolidated basis) of this 
Company and its subsidiaries, classified by branches or departments engaged in 
production, manufacturing and refining, transportation, and marketing, for the 
years 1936, 1937 and 1938. We are attaching the analysis for each of the three 
years in question. 

In order to make the departmental breakdown required in the attached state- 
ments, the following procedure was followed: Current Assets, Non-Current 
Security Investments, and Deferred Charges, which in general pertain to the 
Companies as a whole, are allocated on the three Departments on the same 
percentage basis as Properties, Plants and Equipment. 

Total Gross Revenue, as shown in the attached statements, is after elimination 
of inter-company and inter-department sales. The books of each department 
reflect these inter-company and inter-department items. In allocating Gross 
Revenue to the three departments, we have ascertained the percentage which 
the gross revenue (including inter-company, etc., items) of each department bears 
to the total revenue (including inter-company, etc., items), and have applied the 
resulting percentages to the Gross Revenue with intercompany, etc., items 
eliminated. 

Marketing assets are comparatively negligible in amount, and are included 
with Refining and Manufacturing assets. Properties, Plants and Equipment are 
stated at cost. Reserves for Depreciation and Depletion give effect to adjustments, 
made in later years, in accordance with agreements reached with the Bureau of 
Internal Revenue. 

If further information is desired, kindly let us know. 
Very truly yours, 

Danciger Oil & Refining Company, 
By G. B. Magruder, Jr. 

CMS:H 

Danciger Oil & Refining Company 

Analysis of consolidated assets and consolidated income, classified by departments 

1936 





Total 


Production 


Transportation 


Refining and 
manufacturinf? 




Amount 


Per- 
cent 


Amount 


%of 
total 


Amount 


%of 
total 


Amount 


%of 
total 


Assets Used or Employed: 
1. Properties, Plant and 

Equipment 

Jjess: Reserves for De- 
preciation and De- 
pletion .. 


$6,110,323.35 
2, 244, 139. 48 


100 
100 


$3,415,827.09 
1, 273, 795. 36 


56.0 
57.0 


$429, 563. 42 
175, 668. 75 


7.0 
7.6 


$2. 264, 932. 84 
794, 675. 37 


37.0 
35 4 






Net -. 


3, 866, 183. 87 
1, 566, 365. 88 

1,361.75 
45, 529. 95 


100 
100 

100 
100 


2, 142, 031. 73 
877, 164. 90 

762. 58 
25, 496. 77 


55.4 
56.0 

56.0 
56.0 


253, 894. 67 
l09, 645. 60 

95.32 
3, 187. 10 


6.5 
7.0 

7.0 
7.0 


1, 470. 257. 47 
579, 555. 38 

503. 85 
16, 846. 08 


38 1 


2. Current Assets 

3. Non-Current Security 

Investments 

6. Deferred Charges 


37.0 

37.0 
37.0 




$5, 479, 44 L 45 


100 


$3,045,455.98 


55.6 


$366, 822. 69 


6.7 


$2,067,162.78 


37.7 



10188 



CONCENTRATION OF ECONOMIC POWER 



Analysis of consolidated assets and consolidated income, classified by Departments- 
Continued 

1936— Continued 





Total 


Production 


Transportation 


Refining and 
manufacturing 




Amount 


Per- 
cent 


Amount 


%of 
total 


Amount 


%of 
total 


Amount 


total 


Income: 

1. Gross Revenue 

Ratio to Total Assets. 

2. Net Income Before 

Interest and Divi- 
dends. . - 


$6,383,861.57 
116. 50 

343, 918. 20 
6.28 


100 
100 


$3, 236, 617. 82 
106.28 

119, 781. 37 
3.93 


50.7 
34.8 


$223, 435. 14 
60.91 

4,914.15 
1.34 


3.5 
1.4 


$2,923,808.61 
141.44 

219, 222. 68 
10.6 


45.8 
63.8 


Ratio to Total Assets. 





1937 



Assets Used or Employed: 

1. Properties, Plant and 

Equipment- - _ . 


.$6,825,800.96 
2, 734, 157. 45 


100 
100 


$3, 951, 476. 71 
1, 500, 439. 95 


57.9 
54.9 


$428, 464. 67 
212, 932. 54 


6.3 

7.8 


$2,445,859.68 
1, 020, 784. 96 


35.8 


Less Reserves for De- 
preciation and De- 
pletion 


37.3 






Net - 


4,091,643.51 
1, 717, 621. 56 

4, 958. 98 
36,036.79 


100 
100 

100 
100 


2, 451, 036. 76 
994, 502. 87 

2, 87;. 25 
20, 865. 30 


59.9 
57.9 

57.9 
57.9 


215, 532. 13 
108, 210. 16 

312. 42 
2, 270. 32 


5.3 
6.3 

6.3 
6.3 


1, 425, 074. 62 
614.908.53 

1, 775. 31 
12, 901. 17 


34.8 


2. Current Assets..^ 

3. Non-Current Security 

Investments 

6. Deferred Charges 


35.8 

35.8 
35.8 




$5, 850, 260. 84 


100 


$3,469,276.18 


59.3 


$326, 325. 03 


5.6 


$2, 054, 659. 63 


35.1 


Income: 

1. Gross Revenue 

Ratio to Total Assets. 

2. Net Income Before 

Interest and Divi- 
dends.. . .- . - 


$7,487,919.10 
127. 99 

393, 645. 40 
6.73 


100 
100 


$3, 661, 592. 44 
105. 54 

188, 930. 62 
5.45 


48.9 
48.0 


$224, 637. 57 
68.84 

19, 438. 96 
5.96 


48.1 

47.1 


$3,601,689.09 
175.29 

185, 275. 82 
9.02 


3.0 
4.9 


Ratio to Total Assets . 





1938 



Assets Used or Employed: 
1. Properties, Plants and 
Equipment 


$6, 986, 685. 63 
3,151,684.78 


100 
100 


$4,072,049.13 
1,658,917.52 


58.3 
52.6 


$413, 637. 64 
243, 501. 10 


5.9 

7.7 


$3, 500, 998. 86 
1, 249, 266. 16 


35.8 


Less: Reserves for De- 
preciation and De- 
pletion 


39.7 






Net 


3, 835, 000. 85 
1,932,865.27 

1, 261. 75 
19,902.86 


100 
100 

100 
100 


2, 413, 131. 61 
1, 126, 860. 44 

735.60 
11, fi03. 37 


62.9 
58.3 

68.3 
58.3 


170, 136. 54 
114,039.05 

74.44 
1, 174. 27 


4.4 
5.9 

6.9 
5.9 


1, 251, 732. 70 
691,965.78 

461. 71 
7, 125. 22 


32.7 


2. Current Assets 

3. Non-Current Security 

Investments 

6. Deferred Charges 


35.8 

35.8 
35.8 




$5, 789, 030. 73 


100 


$3, 552, 331. 02 


61.4 


$285, 424. 30 


4.9 


$1,951,275.41 


33.7 


Income: 

1. Gross Revenue-- 

Ratio to Total Assets. 

2. Net Income Before 

Interest and Divi- 
dends. 


$6, 794, 471. 35 
117. 37 

1SZ,277.7Z 


100 


$3, 349, 674, 38 
94.30 

143, 933. 17 
4.05 


49.3 


$115,506.01 
40.47 

10, m. OS 
3.61 


1.7 


.$3, 329, 290. 96 
170. 62 

eeS. 916. 86 

i3.es 


49.0 


Ratio to Total Assets. 





CONCENTRATION OF ECONOMIC POWER 



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10204 



CONCENTRATION OF ECONOMIC POWER 

Republic Oil Refining Company 
Analysis of consolidated assets and consolidated income 

DECEMBER 31, 1936. 





Total 


C. Refining and 
Manufacturing 


D. Marketing 




Amount 


Per 

cent 


Amount 


Per 

cent 


Amount 


Per 
cent 


Assets Used or Employed: 

1. Properties, Plant and Equipment _ 

Less Reserve for Depreciation 


$1, 520, 000. 00 
518, 000. 00 


100 
100 


$1, 466, 000. 00 
490, 000. 00 


96.45 
94.60 


$.54,000.00 
28, 000. 00 


3.55 
5.40 






Net 


1, 002, 000. 00 
1, 949, 000. 00 


100 
100 
100 

100 
100 
100 
100 


976, 000. 00 
1, 645, 000. 00 


97.40 
84.40 


26, 000. 00 
304, 000. 00 


2.60 


2. Current Assets 


15.60 


3. Non-Current Security Investment 




4. Investments and Advances in Affiliates 
Companies— Nonconsolidated 












5. Intangible Assets.. 












6. Deferred Charges. - - .. .. 


27,000.00 


27.000.00 


100 






7. Other Assets 
















8. Totals 


2, 978, 000. 00 


100 


2, 648, 000. 00 


88.92 


330, 000. 00 


11.08 






Income: 
1. Gross Reserve 


8, 966, 000. 00 
3tol 

123,000.00 
lto24 


100 
100 


5, 032, 000. 00 
1.9 to 1 

123,000.00 
1 to 21.52 


56. 12 
100 


3,934,000.00 
11.92 to 1 


43.88 


Ratio to Total Assets 




2. Net Income before Interest and Divi- 
dends - 




Ratio to Total Assets 















DECEMBER 31, 1937. 



Assets Used or Employed: 

1. Properties, Plant and Equipment 

Less Reserve for Depreciation . . 


$1, 728, 000. 00 
669,000.00 


100 
100 


$1,693,000.00 
656,000.00 


97.98 
98.06 


$35, 000. 00 
13, 000. 00 


2.02 
1.94 






Net 

2. Current Assets 


1, 059, 000. 00 
3, 033, 000. 00 


100 
100 
100 

100 
100 
100 
100 


1, 037, 000. 00 
2, 571, 000. 00 


97.92 

84.77 


22,000.00 
462, 000. 00 


2.08 
15.23 


3. Non-Current Security Investment 




4. Investment and Advances in Affiliates 
Companies — Unconsolidated 


25,000.00 


25,000.00 








8. Intangible Assets. 








6. Deferred Charges . 


30,000.00 


30, 000. 00 








7. Other Assets .. 




















8. Totals .... 


4, 147, 000. 00 


100 


3, 663, 000. 00 


88.33 


484,000.00 


11.67 






Income: 
1. Gross Revenue . . 


12,357,000.00 
2.97 to 1 

384, 000. 00 
1 to 10.8 


100 
100 


8, 255, 000. 00 
2.25 to 1 

384, 000-,00 
1 to 9.53 


66.80 
100 


4,102,000.00 
8.47 to 1 


33.20 


Ratio to Total Assets 




2. Net Income before Interest and Divi- 
dends 




Ratio to Total Assets 















DECEMBER 31, 


1938. 










Assets Used or Employed: 

1. Properties, Plant and Equipment 

Less Reserve for Depreciation 


$2,235,000.00 
829, 000. 00 


100 
100 


$2,208,000.00 
813, 000. 00 


98.79 
98.06 


$27,000.00 
16.000.00 


1.21 
1.94 






Net 


1,406,000.00 
4,400,000.00 


100 
100 


1,395,000.00 
3,976,000.00 


99.21 
90.36 


11.000.00 
424,000.00 


.79 


2. Current Assets.. 


9.64 


3. Non-Current Security Investment 




4. Investment and Advances in Affiliated 


56,000.00 


100 


56,000.00 


100 














20,000.00 


ioo 


20,000.00 








7. Other Assets 






















8. Total . . 


5,882,000.00 


100 


5, 447, 000. 00 


92.60 


435.000.00 


7.40 


Income: 
1. Gross Revenue . -. 


16, 810, 000. 00 

2.85 ^0 1 

-353,000.00 

1 to 16.66 


100 


12, 912, 000. 00 

2.37 to 1 

-353,000.00 

1 to 15.43 


76.81 


3, 898, 000. 00 
8.96 to 1 


23.19 


Ratio to Total Assets 








Ratio to Total Assets 

















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CONCENTRATION OF ECONOMIC POWER 



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10206 



CONCENTRATION OF ECONOMIC POWER 



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CONCENTRATION OF ECONOMIC POWER 



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10210 CONCENTRATION OF ECONOMIC POWER 

Standard Oil Company, Inc., in Kentucky 

Analysis of consolidated assets and consolidated income, classified by branches or 

departments 

YEAR 1930 





Total 


(1) Marketing 


(2) general In- 
vestments 


Miscellaneous 




Amount 


Per- 
cent 


Amount 


%of 
total 


Amount 


%of 
total 


Amount 


%of 
total 


Assets Used or Employed: 
1. Properties, Plant and Equipment- 


329.0 
137.8 


100 
100 














Less: Reserves for Depreciation, 
Depletion and Amortization 




























Net 


191.2 
51.7 

89.8 


100 
100 

100 

100 
100 
100 
100 


191.2 
51.7 


.4833 
.1307 










2. Current Assets 










3. Non-current Security Invest- 
ments . 


89.8 


.2270 






4. Investments and Advances in Af- 
filiated Companies-Unconsoli- 
dated 










6. Intangible Assets. 


• 2.8 

1.4 

58.7 


2.8 

1.4 

68.7 


.0071 
.0035 
.1484 










6. Deferred Charges 










7. Other Assets — Mdse. Inventory.. 




















8. Totals -- - 


395.6 


100 


305.8 


.7730 


89.8 


.2270 












Income: 
1. Gross Revenue — less Federal & 
State Excise Taxes 


460.0 


100 




.1163 










Ratio to Total Assets :.. 












2. Net Income Before Interest and 
Dividends . . 


37.9 


100 




.0959 










Ratio to Total Assets 































(1) (a) Production, (b) Transportation, (c) Refining and Manufacturing; (2) Foreign Petroleum Branches; 
(3) Investments, etc. Columns eliminated — We have no investment. 

YEAR 1937 



.\ssets Used or Empjoyed: 
1. Properties, Plant and Equipment 
Less: Reserves for Depreciation, 
depletion and Amortization 


339.3 
136.7 


100 
100 






































Net - 


202.6 
61.3 

70.9 


100 
100 

100 

100 
100 
100 
100 


202.6 
61.3 


. 5055 
.1529 










2. Current Assets 










3. Non-Current Security Invest- 
ments - 


70.9 


.1769 






4. Investments and Advances in Af- 
filiated Companies Unconsoli- 










6. Intangible As.«et3 


3.5 

1.7 

60.8 


3.5 

1.7 

60.8 


.0087* 
.0042- 
.1517 




















7. Other Assets — Mdse. Inventory 




















8. Totals - -- 


400.8 


100 


329.9 


.8231 


70.9 


.1769 












Income: 
1. Gross Revenue— Less Federal & 
State Excise Taxes 


534.9 


100 


133.5 












Ratio to Total Assets 












2. Net Income before Interest and 


41.8 


100 


104.3 












Ratio to Total Assets 































CONCENTRATION OF ECONOMIC POWER 



10211 



Analysis of consolidated assets and consolidated income, classified by branches or 

departments — Continued 

YEAR 1938 





Total 


(1) Marketing 


(2) general In- 
vestments 


Miscellaneous 




Amount 


Per- 
cent 


Amount 


%of 
total 


Amount 


total 


Amount 


%of 
total 


Assets Used or Employed: 
1. Properties, Plant and Equipment. 
Less: Reserves for Depreciation, 
Depletion and Amortization 


354.1 
141.1 


100 
100 








































Net 


213.0 
64.6 

69.4 


100 
100 

100 

100 
100 
100 
100 


213.0 
64.6 


.5184 
.1572 










2. Current Assets 










3. Non-Current Security Invest- 
ments 


69.4 


.1689 






4. Investments and Advances in Af- 
filiated Companies Unconsoli- 
dated. _ 










5. Intancible Assets 


4.8 

1.8 

57.3 


4.8 

1.8 

57.3 


.0117 
.0044 
.1394 










6. Deferred Charpes ' 










7. Other Assets.. 




















8. Totals 


410.9 


100 


341.5 


.8311 


69.4 


.1689 












Income: 
1. Gross Revenue 


518.1 


100 


126.1 












Ratio to Total Assets 












2. Net Income before Interest and 
Dividends. 


37.7 


100 


.0917 












Ratio to total Assets 































H. W. PiEBPONT, President 



Standard Oil Company 
(Nebraska) 



Omaha, Neb., August 21, 1939. 
File A 
Mr. James R. Brackett, 

Executive Secretary, Congress of the United States, 

Apex Building, Washington, D. C. 
Dear Sir: I have your letter of August 14th requesting certain information 
to Items 11-k (1) and 11-k (2). 

Inasmuch as our company is a marketing company only, there is no further 
information for us to give. 
Yours very truly, 

H. W. PlERPONT. 



12441)1— 40— pt. 17- A- 



10212 



CONCENTRATION OF ECONOMIC POWER 



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CONCENTRATION OF ECONOMIC POWER 



10213 





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