‘ _ Equipment acquisition cost 
Equipment; Lo = E 5) Ser iY 
Motorized equipment, I = Equipment ac ee cost + salvage value x 97 
Land acquisition cost x:..06 
Variable cost, interest at .07 x % year usage 
Estimated 1968 Costs 
Operating costs during 1968 were computed as follows: 
Wages.--Increased to $1.60 per hour if $1.40 or less. 
Increased 20 cents per hour if the average was more than $1.40 for 
a particular job. 
All overtime computed at 1% times the above rates. 
Salaries.--Executive and management salaries were increased 11.1 percent to 
reflect the average rise in management wages from the average date of the survey 
period, December 1, 1966, to December 1, 1968. 
Office workers' salaries were increased 12.5 percent to reflect average 
salary increases of office workers during the same period. 
Other company costs.--FICA. These costs to the company were computed on 
the new rates and maximums effective in 1968--4.4 percent on $7,800 per employee. 
Unemployment compensation--Usual 1968 rates for each State involved were 
used for the tobacco processing and storing firms. 
Workmen's compensation--Rates were obtained from the board setting or 
approving the rates in each State involved. 
Supplies, utilities, etc., were updated to reflect costs in effect during 
January 1968 as reported in the Survey of Current Business, U.S. Department of 
Commerce, Office of Business Economics. 
Method of Allocation 
Tobacco Processing 
Maryland firms received more tobacco than was redried. Costs applicable only 
to tobacco not redried were excluded from these costs. no Costs that were joint 
between redried and not redried tobaccos and could not be properly assigned by 
company records or management within the firm were allocated by the following 
method. 
1/ Tobacco not redried was shipped green, either loose or in hogsheads. 
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