FARM MANAGEMENT 295 



as a result of close attention to, and a detailed knowledge of, 

 the business." 



The real test of good farm management is to provide a 

 fair income on the capital invested and a fair return as wages 

 to the farmer. The difference between all the receipts and 

 all the expenses represents the farm income. The labor 

 income, or farmer's wage, is the amount of the income re- 

 maining after deducting a reasonable interest charge on the 

 investment, say six per cent. 



Example: 



Capital invested $10,000.00 



Interest at 6 per cent 600.00 



Receipts $2500 .00 



Expenses 800 . oo 



Farm income .$1700.00 



Deduct 6 per cent interest 600 . oo 



Farmer's wage $1100.00 



Many farmers fail to secure more than a small income on 

 their investment and receive little return in wages for their 

 labor. This condition may result from poor farm manage- 

 ment or from the selection of a kind of farming unsuited to 

 the particular farming region. 



Types of farming. When developing a farm organization, 

 the type of farming best suited to the locality in which the 

 farm is located is the first thing to consider. The chief factors 

 concerned are soil and climatic conditions, and market fa- 

 cilities. If the kind of farming is not adapted to the soil and 

 climate the business is likely to fail, no matter how well a 

 farm is managed. For example, an attempt to raise hogs on 

 hilly land may not be successful, however well the farm is 



