uess capital of the company. In the ideal case, where a corporation is financed with due perspicacity, there will be but an inappreciable proportion of the market value of the company's good-will left uncovered by debentures. In the case of a railway company, for instance, no more should be left uncovered by debentures than the value of the '■ franchise," and probably in most cases not that much actually is uncovered.
Whether capitalized good-will (including '* franchise " if necessary) is to be rated as a credit extension is a nice question that can apparently be decided only on a legal technicality. In any case so much seems clear — that good-will is the nucleus of capitalization in modem corporation finance. In a well financed, flourishing corporation, good-will, indeed, constitutes the total remaining assets aft«r liabilities have been met, but the total remaining assets may not nearly equal the total market value of the company's good-will ; 1 that is to say, the material equipment (plant, etc.) I of a shrewdly managed concern is hypothecated at least once, commonly more than once, and its immaterial properties (good-will), together with the evidences of its indebtedness, may also to some extent be drawn into the hypothecation.'
'The question of " swch watering," "ovarcapitaliiation," and the like is scarcely pertinent \d the case of a large iDduitriol corporation financed as the modem situation demands. Under modem ciia nock can searcetj fail to be all " mtar,"