56 BULLETIN 492, U. S. DEPARTMENT OF AGRICULTURE. 



THE COST OF PRODUCING COTTON. 



In an agricultural area devoted almost exclusively to a single enter- 

 prise the cost of production per unit for that enterprise may be de- 

 termined with reasonable accuracy from the data collected through 

 the regular farm-management survey. Such an enterprise is found 

 in Sumter County, where cotton occupies 59 per cent of the crop 

 area and constitutes 89 per cent of the farm receipts. Tables follow 

 illustrating the method used and showing the cost per acre and per 

 pound of lint cotton by tenure and by size of farm and yield per acre. 



METHOD USED IN DETERMINING COSTS. 



The method used in determining the cost of producing cotton in- 

 cludes five distinct steps. (1) Finding the percentage of total farm 

 receipts represented by the sale of cotton, including both lint and 

 seed. (2) Finding the total farm operating expense. This is the 

 sum of the general expenses (including such items as labor, repairs, 

 feed, seed, fertilizer, insurance, taxes, etc.), the value of the farmer's 

 own labor, and interest on the capital invested. (3) Calculating the 

 amount of total farm-operating expense chargeable to cotton in pro- 

 portion to the per cent of total receipts derived from cotton. (4) 

 Finding the net cotton expense by deducting the amount received 

 from the sale of cotton seed from the amount of farm-operating ex- 

 pense chargeable to cotton. (5) Finding the cost per acre or per 

 pound of lint cotton, by dividing the net cotton expense respectively 

 by the number of acres in cotton or hj the number of pounds of lint 

 cotton raised. 



While this method would not be advisable where there are several 

 leading enterprises, yet it has advantages in regions of this nature. 

 Here the crop area that was not occupied by cotton is utilized almost 

 entirely in growing crops to support the mules and labor used in 

 growing cotton. 



In Table XXVII are shown in detail the steps taken in arriving 

 at the cost of production on the 160 farms operated by white owners. 

 On these farms the total receipts were $655,526, of which $569,651, 

 or 86.9 per cent, were from the sale of lint cotton and seed. The 

 total general expenses were $408,876, and by adding to this sum the 

 vaule of the farmers' own labor, $70,451, plus $110,184, which is the 

 interest at 5 per cent upon the capital ($2,203,673) invested, equals 

 $589,511, the total farm operating expenses. In prorating these 

 expenses, 86.9 per cent of the total expenditures of $589,511 equals 

 $512,285, the amount of the total operating expenses chargeable to 

 cotton. 



