14 BULLETIN 994, U. S. DEPARTMENT OF AGRICULTURE. 



to the hogs of $10.62 per head. It was still more striking in 1914, 

 when the book profit was only $0.84 per head under the opportunity 

 cost, while on the other basis the profit was $10.24 per head. In 

 1915, owing to the condition of the corn crop, the amount of profit 

 per head was not as great, but the difference in the two methods 

 was about the same as in 1913. 



A danger may lurk in the farmer being satisfied with a nominal 

 profit and not attempting to increase the productivity of his enter- 

 prises for further profits. Any analysis should make clear that the 

 live-stock profit on the actual expense basis includes in reality a 

 profit on the crops grown for feeding purposes and that with each 

 enterprise standing on its own feet from a relative cost and profit 

 standpoint the result would not be the same. This point is more 

 fully discussed under methods of charging feed to live stock. 



Thus there is an obvious need for analysis, both of the opportunity 

 cost and the actual operating expense in a farm business, of the one 

 for the purpose of pointing out possibilities and fostering more 

 profitable farm organization, of the other to show why production 

 is continued and prosperity real, though not apparent from a business 

 point of view. For certain purposes presumptive results have a 

 working value, but actual results may well go along with the oppor- 

 tunity cost figures to maintain the balance of the analysis. 



THE SEVERAL METHODS OF STUDY. 



There are several distinct methods and combinations of methods 

 which may be used in obtaining cost of production and farm organiza- 

 tion data. The two outstanding methods may be termed (1) the 

 accounting method and (2) the survey method. The following 

 outline sets forth the various modifications and combinations of 

 these methods that have been used more or less successfully. They 

 will be discussed in the order they are listed below. 



1. Accounting method. 



1. Route plan. 



a. Entire farm business. 



b. Enterprise and farm business study. 



c. Extensive enterprise study. 



2. Occasional visit and book plan. 



3. Correspondence plan. 

 II. Survey method. 



1. Farm business analysis. 



a. Single extensive survey. 



b. Continued surveys. 



c. Periodic repeated surveys. 



2. Enterprise cost studies. 



a. With farm business analysis. 



b. Without farm business analysis. 



3. Questionnaire. 

 III. Combinations of I and II. 



