14 BULLETIN 49, U. S. DEPARTMENT OF AGRICULTURE. 



Building charge. — The charge made against the calves for shelter 

 includes interest and depreciation and ordinary current repairs on 

 the barn used by the calves. Interest is figured at 5 per cent and de- 

 preciation (plus repairs) at 3 per cent on the average inventory 

 value. The average inventory value of the barn used for the first 

 year was $400, making a building charge of $32 for the group, or 

 $1.57 per head. The buildings used the second year were sheds valued 

 at $175, and 8 per cent on this valuation is only $12.80, or 81 cents 

 per head. 



Equipment charge. — The equipment used in caring for the growing 

 calves consists of a steamer for heating milk, feeding pails, cans, and 

 a few other minor articles. The equipment charge includes interest 

 at 5 per cent, depreciation, and current repairs. Equipment of this 

 kind depreciates rapidly, and therefore 20 per cent on first inventory 

 valuation is none too large to cover this item and current repairs. 

 The total equipment expense for the first year is $11.18, or 55 cents 

 per head. No special equipment was used the second year. 



Interest. — There is a certain amount of money tied up in the rais- 

 ing of the calf from birth until it enters the herd as a full-grown 

 heifer. A nominal rate of interest on this investment must be con- 

 sidered as one item of cost. The difficulty that arises at this point is 

 to know the investment upon which interest should be charged. The 

 ordinary practice in handling farm accounts is to use one-half the 

 sum of the inventory values taken at the beginning and end of each 

 year, but in this case it is difficult to say what the value at the end of 

 the first year should be. 



The inventory value of a yearling beef heifer is largely determined 

 by her market value for the meat, but with a dairy heifer there is no 

 definite market upon which to base this valuation. In the absence Of 

 a standard basis it would seem feasible to use cost figures. Interest 

 has already been included on equipment and buildings under charge^ 

 for those items. The known items at this point upon which interest 

 has not been figured are the cost of feed, labor, bedding, and mis- 

 cellaneous expenses. These amount to $31 for the first year and 

 represent the increase during the } r ear. Therefore, on the basis of 

 cost figures, the second inventory value is $31 plus the initial value, or 

 the first inventory of $7, i. e., $38. The average value of the two in- 

 ventories is. then, $22.50, and 5 per cent of this sum is $1.12, the 

 interest charge per head for the first year. 



The value at the beginning of the second year is the total cost of 

 the first year, which is $39.95. The second value, determined in the 

 same Avay as for the first-year group, is $01.08. This makes the 

 average $50.51 and the interest charge $2.53 per head. 



Bedding. — The calves were kept well bedded with straw while in 

 the barn. The first }'ear about one load of straw was used per calf, 



