Catoctin clarion., 1914-11-12
RELATION OF SIZE OF BUsIN Ess
TO THE FARMERS INCOME.

| - '''SA>&A 1SeN~J ~
experts in regard to the profits made
by large number of farmers in diff
ferent parts of the United States
shows that the size of the farm bust
ness is one of the most important
factors controlling the farmers in
come. The problem of how large al.
investment is needed in order to carry
on>a certain type of farming to ad-
vantage is of the utmost Importance.
The amount of this investment will
vary according to the type of farm
ing and to the region selected.
In a survey of over 100 farms in
an irrigated district in Utah only
three farm owners, with less than
500 total capital, received a labor
income OF more than 81 900 for their
years work.
BY labor income in this case is
meant what remains of the net in
come after drducting 6 per cent for
invested capital and working capital;
in other words, what the farmer him.
self receives for his years work and
supervision.
In a group Of 35 of these men, who
had small farms and an average cap
ital of S5,345, the average labor in
come was S235. One out OF every
five received nothing for his labor
and made less than 5 per cent inter.
est on his farm investment. With
high-priced land this amount of cap
ital gave him too small an area to
utilize to advantage. II land was
cheaper, SO that much larger area
could be obtained with the same
amount of money, then slO,OOO.OO
might be sufficient investment to
give the farmer substantial income.
In the Central States, where corn,
wheat, and oats are the prevailing
crops and where land is from $50 to
$3.50 an acre, $4,000 would be en-
tirely too small an investment to yield
the owner a good income, for the rea-
| +l,,t tn 4, nprno--fhn tlfal |
amount of land he could possibly buy
with this amount of money-would
not utilize his teams, machinery, or
labor to the fullest advantage.
On the other hand, the number OF
acres is not always true measure,
as a big business can be conducted
on small area; 20 acres OF truck
and small fruits may equal POO
acre farm devoted to grain, hay, cat
tie, and hogs. 1t is the type of farm
ing that determines the number Of
acres necessary for efficient operation,
Many persons have made the mistake
of buying too high priced land for
successful general farming. In other
words, they paid truck farming prices
for land which, on account Of market
relations, should De used for only
grain and general farming
The proportion Of the total invest
ment that should be used as working
capital is equally as important as size
of investment. Generally speaking,
about IS to SO per cent of the farm
er's investment is in real estate, the
other II to 25 per cent being in live
stock and other equipment. This
proportion will vary according to the
type of farming followed. In regions
where dairying is the main enterprise
the amount of working capital may
represent one fourth of the entire in
vestment.
A third point IN the consideration
of the farmers investment is the
quality of material in which working
capital is invested. This is especially
true in regard to live stock. lnvesti-
cations relating to profits in farming
show conclusivcly that the efficiency
of the animals to which the crops are
fed is one of the most important fact
ors in determining the farmers net
income. This is to be expected, since
on many farms IN this country the
bulk of the crops is in reality sold to
the dairy herd or to meat at-producing
animals. If these are of such poor
quality that they yield low returns
for their feed, the income to the
farmer must be correspondingly
small. Hence, no matter how large
the total investment, if the quality
of the equipment is deficient financial
failure is inevitable.
MT. VEsUVIUS IN ERUPTION.