682 



Forestry Quarterly. 



Table i. — Distribution of construction costs per M. bd. ft. and 



stumpage values 



If railroad construction cost is not to be distributed per thous- 

 and board feet, what, then, is the proper method? If not quan- 

 tity, then value must be the basis. Value is an important element 

 in rate making by common carrier railroad, as indicated by the 

 higher freight rates on manufactured articles of high value in 

 comparison to those on coal and ores of relatively low value in 

 proportion to weight. It is believed that both the elements of 

 value and quantity should be given a place in rate making on the 

 books of a logging railroad, apportioning the construction costs 

 according to value and the operating costs by the thousand board 

 feet. The same principle could be applied in operations where a 

 railroad is not used, by distributing the expense of building a 

 wagon road, flume, or other improvement of fixed cost, no mat- 

 ter how much material is taken out, on the basis of value. The 

 following plan for the distribution of fixed construction charges 

 on a value basis is suggested. 



The data required is as follows : 



The f. o. b. mill value of the species involved=v 

 The total operating and manufacturing costs including interest 

 and depreciation per Mr^^c 



The average stand per acre for each species and product=:s 

 Then for each species the index value (=i) (or value to be 



