8 



N. H. Agricultural Experiment Station 



[Bulletin 279 



Income 



The farm income was computed for each farm by subtracting cash ex- 

 penses plus loss in inventory from cash receipts plus inventory gains 

 (Table 5.) The resulting figure is the return for wages of labor and 

 management of the operator and returns on the capital invested. In the 

 three years the average farm income was $1,011, $3,667, and $1,867, re- 

 spectively. These are the average incomes that the operators would enjoy 

 if their farms and personal property were free of debt. 



Table S~Financial statement of average receipts and expenses and labor 

 income on orchard farms for three years 



By assuming that 5 per cent on the investment as estimated in inventory 

 was the return for capital, an estimated labor income was computed for 

 each farm. It is to be remembered that the inventory values were arbi- 

 trarily made up and that the value of trees, for instance, was based partly 

 on expected returns. Actually, if we were able to make an historical study 

 of the costs of the orchard we might find that the trees had cost twice 

 this on some farms and perhaps less on others. Also, it is well to recall 

 that the profitableness or unprofitableness of the apple business over a 

 period of years has an influence on the sale value of orchards. The labor 

 income as shown here should 1)e conceived of as estimated and based on 

 assumed interest on estimated value rather than real income. 



As would be expected in a business with varying production as well as 

 varying prices, the labor incomes fluctuated greatly, ranging from $80 in 

 1926 to $2,777 in 1927, a year of good yields and high apple prices. The 

 average of the 31 annual incomes was $1,346. 



The average labor income of the seven farms which were in the study 

 for three years was -$14 in 1926. $2,833 in 1927 and $966 in 1928. Sev- 

 eral farms with low incomes in 1926 had incomes of over $5,000 in 1927. 



The distribution of individual farm incomes by years is shown in 

 Table 6. 



In 1926. the range in income was from -$1,936 to $2,112; in 1927, 

 from -$847 to $5,979, and in 1928, from -$3,678 to $7,195. The average 

 annual income for each farm for the period of the study ranged from 

 $7 to $2,940 and the mean was $1,303. 



