256 Profit and Loss Sharing in Agriculture, [june, 



6. Farm Credits. — The farm must be credited with the 

 estimated annual value of the farm dwelling-house as well 

 as with all farm produce used in it. 



• 7. Profit or Loss. — The profit to be distributed (or the loss 

 shown) will appear after making the adjustments above 

 indicated, that is, after charging the farm with (a) Interest on 

 Capital, {b) Employees' Wages, and (c) Employer's Wages — 

 the rest of the accounting being on the usual lines. 



8. Example. — The following example may now be given to 

 show how the Scheme would work in practice. On a certain 

 farm accurate accounts have been kept since 1905, and the 

 summarised results for the last two years were as follows : — * 



Year ending Michaelmas. 



igi8. 



igig. 





£ 



I 



Receipts during year 



4,064 



3.752 



Capital at end of year 



4.765 



4.775 





£8,829 . 



. ;^8.527 



Capital at beginning of year 



3>947 



4.765 



Payments during year 



3.992 



3.342 



Balance 



890 



420 





£8,829 . 



• ;^8.527 



Cash wages paid 





. "7874 



For profit and loss sharing purposes the following adjust- 

 ments would be necessary : — 





igiy-i8. 



igi8-ig 





I 



£ 



(i) Cash wages paid 



619 



874 



A dd Rent of two cottages (only 







perquisites) . . 



10 



10 



Total Employees* wages . . 



£^29 



£^^A 



To be divided into — 







Wages paid to " ineligible " 



£ 



£ 



workers 



40 



64 



Wages paid to " eligible " 







workers 



589 



820 





£^29 



^884 



(2) It was agreed to allow the farmer £-^oo per annum for manage- 

 ment, while the work of two sons was valued at ^125 in 191 7-1 8 

 and £1^0 in 191 8-1 9, hence total employer's wages was £^2$ 

 and ;^46o in 191 7-1 8 and 191 8-1 9, respectively. 



* All figures given to tke nearest ii. 



