cessarily long period of waiting before paying returns can be
obtained. Farmers who have not gone into the business of fruit growing
because they could not afford this heavy investment or to wait so long
for returns have been wise. Others who, though lacking the necessary
capital, still have planted heavily have learned to their sorrow the
importance of capital in the business both for the original investment
and to carry the enterprise. And yet with sufficient capital and the
proper conditions there is no more attractive or profitable line of
agriculture than fruit growing.
Who knows what it costs to grow an orchard to bearing age? Or what it
costs to produce a barrel of apples? We venture to say that very few
persons do. Because of the large investment both in fixed and in
working capital it is most important to know these costs. Moreover an
accurate knowledge of the financial conditions and facts in any
business is of first importance to intelligent management. For these
reasons every grower ought to keep careful records of the cost and
income from each field or orchard every year in order to determine as
accurately as possible what his crops have cost him per unit and per
acre and what rate of interest he has realized on his investment. As
farming becomes more intensive competition increases, costs multiply,
and the margin of profit on any given unit becomes smaller. It
therefore becomes increasingly necessary to have accurate records on
the cost of production.
FACTORS IN THE COST OF PRODUCTION.--The value of records depends on
their accuracy and on their completeness. There are a great many
factors which enter into the cost of production. For convenience these
may be classified as cash costs and labor costs. Labor charges should
include the work of both men and teams at a rate determined by their
actual cost or by a careful estimate. Man labor costs are easily
reckoned, as they are either simple cash or cash plus board and
certain privileges, the value of which should be estimated in cash.
The value of horse labor is more difficult to determine. It is made up
of interest on valuation, depreciation, stable rental, feed, care,
etc. A fair estimate of this cost is $10 a month or $120 a year for a
horse. Cash costs are interest on the investment and on the equipment
in machinery, etc., or rental of the same, taxes, a proper share of
the general farm expenses such as insurance and repairs of buildings,
telephone,
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