I'll make the math simple, and remember this is a quick example. Tons of fault could be found in it:
Say you 100 acres of grass. The 100 acres will run 35 cows. You have expanded to 35 cows, and can't really run any more.
You keep your 3 best heifers each year. This covers normal attrition in your herd. Hopefully the quality of your herd of 35 is continuing to improve.
Rather than keep a cow until she begins to fail, and selling her for salvage (.60 x 1200=$720). Sell the cow as a long bred cow, and 9 or 10 years old (every area is different, but that could be $2000 in many places. Especially off the farm).
You know exactly when a cow will leave, and you keep replacements accordingly. In due time, you will still have "about" the same number of cows leave your herd each year. You will have a younger herd. You have captured the most productive years of a cows life, and sold her for more than double her salvage.
If your building a herd, that logic does not apply. You f you are maintaining a herd, I believe it does. If a cow is a sure nuff momma maker, then keep her till she can't go. For most of us, the average cow in our herd is just that. She's average. If your at you maximum capacity, then pursue a herd that is above average.
Many will disagree, with that logic , and even the math. I threw it together. I've been doing it for a while, and I like it. A cow is going to leave at some point. She might as well be worth something, when you sell her.
Many will say, well you kept a $900-1000 dollar heifer, that took 3 years to sell a calf. That is an expense (and it is). I say if your holding steady at 35 head, and 3 or 4 age out every year, and you keep 3 or 4 every year, that your net income will be greater.