376 AGRICULTURAL ECONOMICS 



or will show where fertilizer expense was ill advised or where other 

 wastes occurred. After all such defects in management which can be 

 remedied have been attended to, the question arises, "Can some other 

 crop be substituted for this one and result in greater profit ? " Often 

 crops which make a large gross return are found upon examination of 

 their cost accounts to net a smaller profit than others which appear 

 to be less desirable. 



The mere making of such records as we have been discussing 

 causes the farmer to get a new and helpful point of view. He gets 

 outside the routine of daily work and looks at the enterprise from the 

 position of the entrepreneur instead of that of the laborer. From day 

 to day his mind is so filled with the practical details of operation that 

 he often loses sight of the larger economic bearings of his work. 

 Pride in the appearance of his farm may cause him to forget the 

 financial aspects of the process by which that rustic beauty is secured. 

 Love of animals may result in his ignoring the fact that he is keeping 

 some very expensive pets. The enjoyment he gets out of running 

 power machinery may blind him to the high cost of owning certain 

 farm equipment which might be dispensed with. The account book 

 plays no favorites. Likewise the keeping of accounts involves a 

 process of analysis which results in the discovery and appraisal of 

 items which the farmer has been all too prone to overlook. Such are 

 the depreciation of property values, the marketable value of unpaid 

 labor, and the interest-earning capacity of invested capital. Not 

 until he sees the nature of these values can the farmer be expected to 

 take them into his reckoning. The study and interpretation of his 

 records and accounts is the beginning of wisdom for the farm entre- 

 preneur who determines the ultimate character and direction of 

 agricultural enterprise. 



However, we must not stand up so straight that we bend back- 

 ward ; we must not charge values that do not exist. The general rule 

 for farm cost accounting is to charge both labor and materials at 

 market value. But often things which are not marketable are so 

 charged, and the result is misleading and sometimes absurd. For 

 instance, if stock are raised on feed that would otherwise go to waste 

 and are cared for in time that would otherwise not be profitably 

 employed, charging these at the market rate for salable feed and 

 employed labor gives an apparent loss on a venture which was unques- 

 tionably profitable. The cows that are herded along the roadside by 



