PLANNING THE FARM BUSINESS 93 



The average production of the cows is 6600 pounds of niillv testing about 

 3.5 per cent. This is a good average for a young dairy herd made up of grade 

 Holsteins. 



The statement in Table 3 shows the earning capacity of the present organ- 

 ization based on Mr. A's 1929 records. More than half the cash receipts come 

 from milk sales. Apples represent about a third of the total. Work off the 

 farm is the largest of the minor receipts. The total cash receipts are a little 

 over $3000. 



Table 3. — Fixancial Returns from Present Organization — Farm A. 



Receipts 



Wiiole milk 65,.510 Il)s. @ $2.60 $1703 



9 calves - 76 



Apples, 509 boxes @ $1.70...„ „ „ 865 



Potatoes 100 bu. @ $1.50 - 150 



Work off the farm _ 168 



Wood, and miscellaneous - - 59 



Total Receipts $3021 



Expenses 



Grain „ -....- $844 



Labor hired - - 42 



Veterinary and medicines 4 



Bedding, salt and other livestock expense 22 



Ice 17 



Seeds 12 



Seed potatoes 17 



Potato fertilizer, 1 ton 45 



Spray materials - 30 



Truck registration, fuel and repairs _ 170 



Telephone 33 



Taxes 103 



Ptepairs to buildings and equipment _ 36 



Total Expenses ~ 1375 



Net Return Above Expenses _ $1646 



On the expense side purchased grain accounts for over half the total. Taxes 

 and truck expense are the largest of the smaller items. The total expense is 

 $1375, leaving a net return above cash expenses of $1646. The farm land and 

 Iniiidings together with livestock and equipment are valued at $14,000. If 

 interest at 5 per cent is computed on this valuation, an interest charge of 

 $700 is obtained which, deducted from $1646, leaves $946. This may be con- 

 sidered as the net return to Mr. A, for his labor and management. Of course, 

 the far;n also furnishes milk, eggs, potatoes, apples and other products, as 

 well as a home for his family. 



This financial return is small when it is considered that only a mininuim of 

 expense for repairs and upkeep was incurred during the year. No fertilizer 



