INTERPRETATION OF COST ACCOUNTS 379 



ways connected with the general policy of finding the best 

 ways to do things so that the greatest net income will re- 

 sult. 



Other questions that might arise to cause one to decide 

 whether to change present methods and policies might be 

 enumerated as follows: 



(a) Does it pay to hold a crop for a rise in price or to 

 sell now and invest the money at a fair rate of interest? 



(b) Why does barley not pay as well as potatoes? 



(c) Why does wheat not pay as well as oats? 



(d) Why do I not make as much on hogs as Mr. A, my 

 neighbor ? 



(e) Does this field produce as much corn, oats or alfalfa 

 per acre as that one? Why? 



Without attempting to state specifically how each one 

 of these questions might be answered, it may be said that 

 the starting point in attempting to answer any such ques- 

 tions is the account or analytical table. It is true that an- 

 swering questions like (a) above involves considerable 

 guesswork. However, the point to remember in that 

 particular case is to figure the interest on the money tied 

 up in corn. It is not considered necessary to charge Corn 

 accoumt with interest from time to time on the amount that 

 it might sell for. Such a calculation does not need to ap- 

 pear in the account. It should be made as a supplementary 

 calculation in determining the action to take when the 

 price of the crop is known and an idea is formed as to 

 whether the price will go up or down. 



Initiating New Projects. At times, the farmer is con- 

 fronted with propositions that cause a considerable expen- 

 diture of time and money. Sometimes the proposed change 

 involves the abandonment of some property that is giving 

 good service. It is upon such occasions that a good ac- 

 counting system coupled with a knowledge as to how to get 



