Costs and Values in a Logging Operation. 68i 



operating costs, and subtracting the total from the f. o. b. mill 

 price to get the stumpage value. Thus : : 

 x=v — p (c+r-j-x) 



x=-j^- (c+r) 



When the value for (v — c — r) has already been obtained for 



use in the direct percentage formula, the Forest Service formula 



can be used most easily in the following form, obtained by add- 



P v 



ing the expression v to p and then subtracting, thus : 



P 



x= (v— c— r) —V y-pp 



In this case P is assumed to be 25 per cent., and the two form- 

 ulae become : 



x=4/5v— (c+r) 



x= (v — c — r) — 1/5V 



The following are the conditions of the illustration : 



It is assumed that the area to be logged is 50,000 acres requiring 

 railroad construction amounting to $150,000 or $3 per acre. The 

 average stand per acre is 2,000 board feet while the products 

 (extract wood, tanbark, and ties,) are equivalent to 1,000 board 

 feet. Although the location is in the southern Appalachians only a 

 few species are used in the illustration to avoid confusion. The 

 capacity of the mill is 50,000 board feet a day. The costs of the 

 operation are as follows : 



Cutting and skidding, $4- 50 per M. 



Loading and R. R. haul to mill i .00 " " 



Sawing, handling, and loading lumber 3 • 50 " " 



Overhead charges 2 .00 " " 



Total $11.00 '' " 



R. R. construction per A, $3, per M i .00 " " 



Total $12.00 " " 



Cost of products, f . o. b., excluding railroad construction : 



Extract wood $3 • 00 per cord 



Tanbark 5.00 " 



Ties 20 per piece 



