372 FARM ACCOUNTING 



prepared is to lead to some change in policy. It means, in 

 connection with present methods, that a careful examina- 

 tion of the accounts and records might indicate where a 

 change in policy or method would be desirable. It means, 

 in connection with new projects, that great care should be 

 exercised in inaugurating <i)n/ policies without first exam- 

 ining and studying the accounts, records and analytical 

 tables to see if such unr points ?//// "/>'///." 



Altering Present Policies. A study of the accounts, 

 together with the cost Teronls. requires special training in 

 order to read the contents intelligently. When a certain 

 group of figures indicates some unfavorable condition, the 

 farmer should not seek to change the conditions without 

 bringing all correlative facts into consideration. 



// the first impulse is to abandon certain operations be- 

 cause of the excessive cost, one must not overlook the fact 

 that some crops or livestock are raised as auxiliary ele- 

 ments of the main business. As such, they really help to 

 reduce the cost of the other main crops became they utilize 

 labor af times when it w not needed elsewhere. If such 

 farm elements or operations were not conducted, the cost 

 of labor of the main crops would be increased because the 

 laborers' total wages would be distributed over fewer pro- 

 ductive hours. This would cause each productive hour to 

 bear a higher rate. Accordingly the general crops would 

 be charged with a greater amount of labor in the aggregate 

 if it were not for the auxiliary element. 



When an auxiliary crop is charged with the full hourly 

 rate for the labor performed on it, and is also charged with 

 all other costs, it probably shows a loss. The account of 

 such an auxiliary crop should be analyzed and studied very 

 carefully before the crop is discontinued as being too ex- 

 pensive. 



Some farmers advocate charging such auxiliary crops or 

 livestock with labor at about half price, say ten instead, of 



