24 
BULLETIN 1446, U. S. DEPARTMENT OF AGRICULTURE 
An analysis of what has been termed ''operating expense" (that is r 
all costs except the charge for interest on land, machinery, and work 
stock), grouped together under the following headings, shows for 
owner operators a division about as follows: Man labor and horse 
work, 32 per cent; summer-fallow purchased, 2 per cent; materials, 
15 per cent; and all other costs, 51 per cent. The division of the oper- 
ating expense to tenant operators was about as follows: Man labor 
and horse work, 36 per cent; summer-fallow purchased, 5 per cent; 
materials, 17 per cent; and all other costs, 42 per cent. 
The total operating expense per acre for all years was relatively 
lower to tenants than to owners. Much of this difference was due 
to the lower overhead, tax, and insurance expense to tenants on 
rented farms. On the other hand, because the cost to the tenant was 
based on his share of the expense divided by his share of the yield, 
the operating expense per bushel was relatively higher to tenants 
i 
i 
WINTER WHEAT QUANTITY COST FACTORS PER ACRE 
OWNED YIELD UifJ , AROR 
FARMS PERACRE MAN LABOR 
HOURS 
10 
HORSE WORK 
Fig. 9.— Differences in yields and in the practices of growing and handling the crop caused some 
variations in the quantity requirements of wheat production on these farms. The greater use 
of the tractor on owned farms was mainly responsible for the smaller number of hours of horse 
work as compared with rented farms. The items shown as quantity cost factors represent for 
owned farms from 63 to 67 per cent and for share-rented farms from 68 to 74 per cent of the 
total operating expense of producing an acre of winter wheat. 
than to owners. The average net cost per bushel to both owner and 
tenant operators was materially lower in 1921 than in 1920 and 1922, 
which was mainly due to the exceptionally good yield in 1921. 
CASH AND NONCASH COSTS OF PRODUCTION 
In a study of costs it should be kept in mind that many of the cost 
items are noncash. A division of the cost of winter- wheat production 
into cash and noncash items (Table 21) may explain why some men 
are able to continue in the business of wheat growing for a time when 
producing at a cost higher than the market price. In many instances 
much of the labor is performed by the farmer and his family, and 
when his land, machinery, and work stock are clear of indebtedness a 
large part of the expense that correctly enters into the cost of produc- 
tion is not an actual cash outlay (fig. 10). 
