28 MASS. EXPERIMENT STATION BULLETIN 405 



Of the 272 farmers, 52 percent had no open accounts; 48 percent were borrow- 

 ing on open accounts; and 15 percent were borrowing over $400 per farm and 

 owed 72 percent of this type of credit. The average debt on open accounts for 

 those who used this type of credit was $449. Of those who had open accounts, 

 65 percent indicated only one account and 26 percent two accounts. Very few 

 farmers had more than two accounts, although one or two farmers had seven or 

 eight. 



Although a few farmers owed a friend or relative small amounts for fertilizer 

 or other supplies, the source of open-account credit in practically all cases was a 

 seller. No buyers of agricultural products were indicated by the farmers as ad- 

 vancing credit, although this probably does occur to a limited extent. 



Table 34. — Purposes of Open Accounts on 129 Massachusetts Farms, 

 March 1, 1941. 



The purposes for open accounts are shown in Table 34. About half of all the 

 accounts and the credit was used for purchase of grain. Supplies, which includes 

 fertilizer, seed, spray, hardware, etc., accounted for about a third of the accounts 

 and 41 percent of the credit. Open accounts were not used to any great e.xtent 

 for the purchase of cows. Other open accounts such as garage, water, insurance, 

 etc., were also of minor importance. 



Poultrymen had m.ost of the large open-book accounts for feed; but this did 

 not necessarily mean that they v/eren't doing well. 



Many of the open-book accounts were a continuing source of credit. This 

 amount would vary from time to time. Some of the accounts had remained at a 

 high level while current bills had been paid. In some cases farmers continued 

 to patronize dealers whose prices were higher because they had built up an 

 account with them. These accounts were largely a result of difficulties in main- 

 taining an income. 



Unpaid Taxes 



Unpaid taxes are not usually thought of as credit. However, it is difficult to 

 differentiate between an unpaid bill for grain or a machine and unpaid taxes. 

 Furthermore, if a loan is made to pay taxes, then that loan becomes credit. Most 

 of this credit, though, is borrowed from the town simply by not paying the taxes 

 and the town charges interest. Unpaid taxes are not a recommended source of 

 credit, because of the great liability involved. 



