one-eighteenth of the corn. Practically all farms have small apple orchards. Most of these were intended primarily for home use, although a few are used commercially in a small way after the household needs have been supplied.

In addition to beef cattle and fine-wooled sheep, nearly one-half of the farms have flocks of over 150 chickens, and these form one of the important enterprises of the township. The production of market hogs is also important, although somewhat limited on account of the limited production of corn. Some of the farms raise one or two colts a year, but the production of colts for the last five years has been of comparatively minor importance for the entire township.

FARM TENURE.

Only a small percentage of the farmers in Palmer Township were tenants. This condition holds good for the entire hill section. The 1910 census shows that 18 per cent of the farmers in the hill counties of Ohio were tenants, while in the more level counties of the State, 31 per cent were tenants. Some owners in this area rented other land, usually a field or two, which they farmed with their own land as a farm unit. Since there were so few tenants, and the additional acreage rented by owners was so small in most cases, the data for such farms have been summarized and used in this bulletin as though the operator owned all the land he farmed.

METHOD OF STUDY.

During November and December, 1912, the writer visited the farmers of Palmer Township and made a record of a year's business transactions of these farms, together with an inventory of the farm investment for the beginning and the end of the farm year.' This year extended from November 1, 1911, to November 1, 1912, and it is designated as "the farm year 1912" in this bulletin. This visit was repeated each fall for four additional years, and records of each year's business transactions were taken."

Each year some records were eliminated, because a large proportion of the operator's time was engaged in teaming or in some other occupation not directly connected with the farm business; because the operator rented out a considerable proportion of the crop acreage; or because the record was incomplete or obviously inaccurate.

Usable records were obtained for five years on 25 farms, and for one, two, three, or four years on 48 other farms. In this study one

1 An outline showing a method of analyzing the farm business, together with copies of the blank forms used in this survey, may be obtained by applying to the U. S. Department of Agriculture for Farmers' Bulletin 661.

2 During the visit in 1915 the writer was assisted by Mr. R. D. Jennings, and in 1916 by Mr. Earl D. Strait, both of the Office of Farm Management.

of the objects was to determine important yearly variations. This is best done by comparing the same farms over the five-year period. A study, based upon the data for the farms with the five-year records is, therefore, presented below.

A FIVE-YEAR STUDY OF 25 FARMS.

When studying the farming of an area from a business standpoint some advantages are derived from extending the study over a period of years rather than limiting it to a single year. A study of the yields of crops, prices received for products, expenses incurred in operating the farms, etc., when extended over a period of years will give economic information that can not be obtained from the study of a single year. By extending the study over a period of years data are furnished that show the yearly variations of the many items that enter into a year's farm business, and that define the changes taking place in the agriculture of an area. Studies like these are best made by comparing results on the same farms for several years. In this area, usable records were obtained from 25 farms every year for five consecutive years. These farms were quite representative of all those in the area, and the results derived from the study of this group, whether by years or for the entire period, should

1 Certain terms used in this bulletin are here defined:

Farm investment.-The value at the beginning of the farm year of all real estate, machinery, live stock, and other investment used to carry on the farm business. It includes the value of the farm dwelling, but not the household furnishings.

Receipts. The amount received from the sale of crops, the net increase from stock, and the receipts from outside labor, rent of buildings, etc. The net increase from stock is found by subtracting the sum of the amount paid for stock purchases and the inventory value at the beginning of the year from the sum of the receipts from stock products, sales of live stock, and the inventory value at the end of the year. If the value of crops or supplies on hand was greater at the end of the year than at the beginning, the difference was considered a receipt.

Expenses. The amount of money paid out during the year to carry on the farm business, together with the value of the unpaid labor performed by members of the family. If the value of crops or supplies at the end of the year was less than at the beginning, this was considered an expense. Household or personal expenses are not included.

Farm income. The difference between receipts and expenses. It represents the amount of money available for the farmer's living above the value of family labor, provided he has no interest to pay on mortgages or other debts.

Labor income. The amount that the farmer has left for his labor after 5 per cent interest on the farm investment is deducted from the farm income. It represents what he earned as a result of his year's labor after the earning power of his investment has been deducted. In addition to the labor income the farmer received a house to live in, fuel (when cut from the farm), garden products, milk, butter, eggs, etc.

Per cent on investment.-The rate returned on the farm investment after the value of the farmer's labor is deducted from the farm income. It represents what the investment earned after all expenses have been deducted and the farmer has received a fair wage for his labor.

Animal unit.—In order to compare the different classes of animals and to compute the total amount of live stock on these farms all stock has been computed in terms of animal units. In this area one horse, cow, or steer was counted as one animal unit; two head of young stock (of the above kind) were counted as one animal; 10 sheep, 5 hogs, or 100 chickens were each counted as one animal unit. The number of productive animal units includes all stock except work stock.

prove a source of valuable suggestion to other farmers of the community. The greater part of the following discussion centers around this group of 25 farms.

SUMMARY OF THE FARM BUSINESS.

A brief summary of the business conducted on these farms is presented in Table I. The data shown are averages for the 25 farms for each year from 1912 to 1916, with the five-year average in the last column.

TABLE I.—Summary of the farm business of 25 farms for a period of five years, 1912-1916 (Palmer Township, Washington County, Ohio).

a After deducting farmer's labor from farm income. b The sum of farm income and value of unpaid family labor, or the amount available for family living had there been no interest to pay.

For the five-year period the farms averaged 156 acres, with almost one-fourth of the area in woodland and wasteland. The surface features being somewhat hilly or broken, only 43 acres per farm were used in producing crops, with about one-half of the farm area left for pasture land. Most of the crops were fed to the stock kept on these farms. There were 2.7 work horses per farm and other live stock equivalent to 14.9 horses or cows, cattle comprising more than one-half of all the productive live stock.

The farms were worth about $30 per acre, and this, with the value of the live stock, machinery, etc., represented a farm investment of

$6,378. This investment, together with the farmer's own labor, returned receipts amounting to $925 per year, $419, or 45 per cent, of which were used for expenses in connection with the farm business. After deducting the expenses from the receipts, the farm income, or the combined earning of the investment and the farmer's own labor, was $506. With money worth 5 per cent, and this was the average rate paid by those in the area who borrowed, the farm investment should have earned $319. This amount deducted from the farm income leaves $187 for the farmer's own labor, or his labor income. On the other hand, if the value of the farmer's labor, which he estimated at $290, be first deducted from the farm income, there is left $216, or 3.4 per cent, for the earning of the farm investment. If to the farm income be added $87, the value of the unpaid family labor which was included as an expense, and then $14, the amount of interest paid on borrowed money, be deducted, there is left $579, or the amount of money available for the use of the farmer and his family.

It is well understood that a very significant proportion of the farmer's living is furnished directly by the farm. This may be considered as an addition either to the labor income or to the per cent on investment. Data from 16 farm families in Palmer Township show that the total value of three important items of the farmer's living-food, fuel, and use of a dwelling-was $400 per family. Of this amount $325, or $90 per person, was furnished directly by the farm. The farm furnished in food products $215 per family and in fuel $23, the use of the dwelling being valued at $87. Of the items bought food cost $61 per family and the fuel $14. The average family in this area consisted of 4 persons, or the equivalent of 3.6 adults.

From this table similar studies of the summary of the farm business may be made for each of the years over which the survey extended, and comparisons of the summaries, one year with another, will show the main points of difference for the various years.

The crop acreage did not vary more than an acre per farm from the five-year average except in 1914, when it was 4 acres below the average, and in 1916, when it was 3 acres above the average.

The number of productive live stock increased 20 per cent during the five years, and was accompanied with a change from sheep to cattle, the number of cattle increasing 68 per cent and that of sheep decreasing 58 per cent.

The farm investment increased each year until at the close of the period it was $552 more per farm than at the beginning. The increase in the amount of stock and the higher live-stock prices account for more than one-half of this higher investment.

The farm receipts for three years were within 6 per cent of the five-year average receipts, for one year they were almost 15 per cent below the average, and for the other year they were 20 per cent above the average.

The farm expenses increased each year except in 1913, when they were lower than for any other year. The sales were also the lowest in 1913.

The farm profits, whether measured by the labor income or by the per cent on the investment, were within 20 per cent of the five-year average for three of the years, while in 1913 they were about 40 per cent below the average, and 70 per cent above in 1916.

In 1912 one-third of the farmers were in debt, the indebtedness varying in amount from $150 to $3,000; in 1916 only 1 in 6 was in debt. During this period the mortgages on four farms were paid off with money made from the farming, and on three others the mortgages were decreased, while the amount was increased on but one. Indebtedness decreased more rapidly during the years showing greater profits, while in 1913, the year returning least profits, there was no decrease in the indebtedness.

The yield per acre of crops, the receipts per animal unit from live stock, the price received for products, and the amount of the products available for sale are all important factors with considerable variations during the different years. For comparison these are shown for each year in the summary table (Table I) as percentages of the fiveyear average.

The yield per acre of the more important crops for the different years varied from 89 per cent to 110 per cent of the five-year average; the receipts per animal unit from 93 per cent to 113 per cent; the price received for farm products from 91 per cent to 112 per cent; and the quantity of products sold from 81 per cent to 109 per

cent.

THE FARM AREA.

The farm area for a farm includes the entire acreage operated as one farm. The land may be all owned by the operator, it may be all rented, or it may be partly owned and partly rented. Of the farm area included in this group of farms 90 per cent was owned by operators, 8 per cent cash rented, and 2 per cent share rented.

The slight variations in the farm area from year to year shown in Table I were due to variations in the acreage owned by four farmers-one selling part of his farm and three buying more land—and to yearly variations in the acreages share rented by a few farmers. The land share rented usually represented single fields and included fields in corn, wheat, oats, and hay.