64 BULLETIN 1269, U. S. DEPARTMENT OF AGRICULTURE 
An analysis of the annual profits of this sort actually made on 28 
plantations, after taking losses from bad accounts into account, 
serves to present the facts in a different light. It is admitted that 
the data presented are too limited for absolute generalization, yet 
they are, it is thought, strongly suggestive of the facts. 
On the 28 plantations (36,364 cultivated acres) studied, the annual 
outlay for advances to 1,405 croppers and tenants was approxi- 
mately $441, 000. 49 The amount of the total "book" accounts rep- 
resented here is $564,000, or an aggregate "book" profit of $122,500; 
while the annual loss on "bad accounts" is $40,500, or an actual 
gross profit of $82,000. In other words, the average gross profit 
during the years represented, when the risk is eliminated, was 18.6 
per cent. 
When these figures are reduced to an acreage basis, there is a gross 
profit of $2.25 per acre derived from advances and a loss on bad 
accounts of $1.12 per acre, or an actual gross profit of $1.13 per acre. 
The profit from the supply business on the plantation is intended 
by some planters to pay the cost of administration, that is, the sala- 
ries of farm managers, bookkeepers, and store clerks. Although it 
is not possible to separate these plantations from the others, it is 
possible to show, in connection with the 28 plantations considered, 
the extent to which this phase of plantation business fulfills this 
function. The average cost of administration per cultivated acre 
on the 28 plantations in 1920, not including general-manager sala- 
ries or unpaid labor performed by owner-operators, was $2.19, or 
$1.71 per acre for the land worked by croppers and tenants. The 
cost of supervision was prorated to wage and to cropper and tenant 
land in deriving this figure. Comparing these figures with the profit 
of $1.13 per acre derived from advances, it is seen that the supply 
business on these plantations fails by $1.06 per acre, or by 58 cents 
per acre for cropper and tenant land, to sustain the outlay for admin- 
istration. 
The 18.6 per cent gross profit, after the risk is removed, requires 
further interpretation from another standpoint. Usually a consid- 
erable portion of the credit advanced to croppers and tenants repre- 
sents borrowed capital, for which the landlord pays perhaps an aver- 
age of 8 per cent interest. The planter, more so formerly than now, 
is compelled to arrange for his cash loans early in the year in order 
to have the money for advances when needed. For this reason, he 
may have to pay interest on at least a part of his loan for a longer 
time than he can collect interest on his advanced money. Further- 
more, there is an element of waste in any system of retail distribu- 
tion of supplies. 
On the other hand, when interest, as such, is charged on the ad- 
vances, the rate is slightly higher than that paid by the landlord; 
and the 10 per cent, when added to take care of interest, is equiva- 
lent to annual interest for a year instead of for the actual average 
length of time the advanced money is used. The average period for 
advances to tenants, since such begin in the earlier months and end 
about August, is approximately six months, or slightly longer. The 
** The average annual amounl per cropper family used in the calculation is $240 for all plantations, and 
the amount per tenanl family in the Mississippi Valley and farther west is $600. [n all areas east of the 
Mississippi valley $400 per tenanl family is used. These basic figures are derived from averages of several 
hundred Cropper and tenanl accounts in the areas concerned, and are considered representative of the 
years from loir, to 1921, inclusive, hut probably higher than the average for 1922. 
