May, 1931] Studies in Economics of Apple Orcharding 



65 



Other Costs 



Land value was taken at approximately that for purposes other 

 than orchard and varied from $30 to $80 per acre. For use of land 5 

 per cent, was estimated for interest and 2^ per cent, for tax on land. 

 Interest was figured at 5 per cent, on value of the trees and tax on 

 trees was put in at II/4 per cent. Since the value of the trees results 

 partly from the value of apples, it would be reasoning in a circle to 

 use this figure in determining the cost of producing fruit. But with 

 Hie value of tree assumed as explained briefiy above and with assumed 

 rates per hour for labor, the costs of producing apples as shown in 

 Table 28 can be used in studying the relative situation on the different 

 farms ; and if we have the assumptions in mind, the average cost of 

 producing apples will be reasonably accurate. 



Total Net Cost 



, With these assumptions, the total cost prior to harvest on all farms 

 ' for all three years was $62,180 (Table 28). Of this amount, 6.6 per 



ffPr 



- - JBoAes 



^900 



Acfuol yie/d 



6 7 



Far/n Number 



Fig. 16. Total net cost of producing apples on twelve farms 



This includes in addition to current operating expenses a charge for use 

 of land, interest and taxes on tree values and appreciation or depreciation 

 in value of trees. Farm 6, producing Baldwins only by extensive methods, 

 and Farm 8, by a combination of extensive methods and high yields of Mcln- 

 / tosh, had lowest costs. 



cent, was for use of land. 33.6 per cent, for use of trees and 60.3 per 

 cent, for current operating expenses. But since there should be a 

 credit of $8,114 for tree growth, the net cost of producing apples was 

 only .$54,066 which is $514 per 1,000 boxes normal expected yield and 

 $466 per 1,000 boxes actual yield. 



In cases of joint cost such as this, it is probably more correct to 

 state that an estimated expense of $62,180 resulted in the production 

 of 116,000 boxes of apples and also tree growth estimated at over 

 $8,000 in value. 



Since, however, the major interest in this problem at this point is in 

 fruit production and since apples are the final product, it is per- 

 haps practical to divide the costs by allocating to tree growth a sum 



