BULLETIN 501, U. S. DEPARTMENT OF AGRICULTURE. 
METHODS OF PROCURING DATA. 
The data contained in this publication were procured by a system 
of careful cost accounting in which the owner cooperated with the 
Office of Farm Management. In this system each farmer sent in 
daily reports showing the hours of work performed by men and horses, 
the use made of materials, the quantities of feed consumed by the 
live stock, and the financial transactions, supplemented by explana- 
tory notes. In addition to these reports, individual cow records were 
kept of milk, feed, and inventory values. 
FACTORS INVOLVED IN THE COST OF PRODUCING MILK. 
In determining the cost of producing milk it is highly important 
to know all the factors that must be considered and their relative 
importance. Indeed, one of the most important results of any cost- 
accounting investigation is the determination of the different items 
of expense and their relation to the whole. This relation is of funda- 
mental importance in efficiency studies. 
For convenience in studying the results on these four farms, the 
items of cost are grouped under the headings "Feed and bedding," 
"Labor," "Use of building/' "Use of equipment," "Use of bull," 
"Interest," "Depreciation," "Miscellaneous items," and "Overhead." 
These items are summarized in Table I, and the relative importance 
of each is shown. The ratio between each item and the total cost 
of keeping a cow per year is quite uniform in different herds where 
methods of management are similar. 
Table I, — Relative importance of factors which make up the cost of producing milk. 
Item. 
Actual cost per cow per year. 
Wisconsin 
farm. 
Michigan 
farm. 
Pennsyl- 
vania 
farm. 
North 
Carolina 
farm. 
Feed and bedding i . 
Labor: 
Cows and dairy . 
Marketing milk. 
Use of buildings 
Use of equipment . . . 
Use of bull 
Interest 
Depreciation 
Miscellaneous items . 
Overhead 
§49.23 
29.34 
2.90 
6.74 
1.28 
1.92 
2.70 
171. 77 
2 32.09 
2.67 
4.84 
3.98 
2.61 
2.87 
3.22 
.99 
1.95 
5.97 
S53.77 
21.04 
3.72 
6.62 
1.45 
1.47 
2.07 
5.13 
2.94 
4.91 
$68.06 
22.63 
6.41 
6.38 
7.64 
Total. 
101. 62 
125. 45 
103. 12 
127. 76 
RELATION OF EACH ITEM TO TOTAL COST EXPRESSED IN PERCENTAGE. 
Feed and bedding... 
Labor: 
Cows and dairy . 
Marketing milk . 
Use of buildings 
Use of equipment . . . 
Use of bull 
Interest 
Depreciation 
Miscellaneous items . 
Overhead 
Total. 
48.5 
28.9 
2.8 
6.6 
1.3 
1.9 
2.7 
57.2 
2 25.6 
52.1 
20.4 
3.6 
6.4 
1.4 
1.4 
2.0 
5.0 
2.9 
4.8 
3.2 
2.1 
2.3 
2.6 
.8 
1.5 
4.7 
2.6 
4.7 
100.0 
100.0 
100.0 
53.2 
17.8 
5.0 
5.0 
2.5 
2.8 
4.5 
2.8 
.5 
5.9 
100.0 
i On these farms part of the bedding was refuse from the mangers, thus it was necessary to consider 
feed and bedding as one item. 
2 Includes labor for marketing products. 
