688 Forestry Quarterly. 



in which selHng price, costs, and stumpage are figured on an acre 

 basis and the stumpage then pro-rated, seems most satisfactory. 

 The assumptions of the problem are here modified as follows: 



The overhead charge in the cost of saw timber (see page 5) is 

 assumed to be $1 instead of $2, since in this case it covers only 

 maintenance and cost of supervision and selling. This makes the 

 operating cost $10 per M. 



The sum of the working capital and the original investment in 

 cost of the plant including the railroad is taken as $350,000. The 

 plant is assumed to have a wrecking value at the end of a ten- 

 year operation of $50,000, making the amount to be written off 

 $300,000. 



The profit to be allowed the operator is 15 per cent, of the 

 capital at risk. 



Table 4. — Stumpage values by Hunter's formula. Construction 

 cost, depreciation on equipment and operator's profit distributed 

 on a value basis. 



Stand Value Opera- Stump- 



Species and products, per f. o. b. ting age 



acre. costs. Value. 



s V c v-c s (v-c) .297 (v-c) 



Poplar lumber, 400 $27.00 $10.00 $17.00 $6.80 $4.06 



Chestnut lumber, 900 17.00 10.00 7.00 6.30 2.08 



Chestnut oak lumber, 300 16.00 10.00 6.00 1.80 1.78 



Black Oak lumber, 400 12.00 10.00 2.00 .80 .59 



Extract wood (cords), 400 3.00 i.oo i.oo .30 



Tanbark (cords), .2 8.50 5.00 3.50 .70 1.04 



Ties (pieces), ' .45 -20 .25 1.75 -07 



$19.15 



Operating cost per acre 



2 M feet lumber @ $10.00, $20.00 



I cord extract wood @ $3.00, 3.00 



.2 cord tanbark @ $5.00, i.oo 



7 ties @ $0.20, 1.40 



Total, $25.40 



