Question

CORN CONVENTIONAL TILLAGE NORTH ALABAMA PRICE OR TOTAL PER QUANTITY COST/UNIT ACRE A. REVENUE B. OPERATING EXPENSES ACRE 150.00 6.00 900.00 Seed Treatment Tech Fee ACRE ACRE 28.00 0.00 1.00 2.50 70.00 0.00 0.00 0.00 0.00 120.00 60.00 60.00 1.00 0.33 1.00 1.00 1.00 1.00 0.57 68.40 0.49 29.40 0.49 29.40 8.00 8.00 33.26 10.98 20.00 20.00 7.00 7.00 0.00 0.00 0.00 0.00 UNITS UNITS ACRE TONS ACRE ACRE 1 ACRE ACRE Lime (Prorated) Fungicides Nematicide 5.00 0.00 12.00 0.00 ACRE AC/IN BU. BU ACRE ACRE ACRE 0.00 0.00 150.00 150.00 1.00 0.00 0.00 Irrigation Hauling Crop Insurance Aerial Application Land Rent Labor (Wages & Fringe) Tractor/Machinery Interest on 0.25 37.50 0.25 37.50 20.00 20.00 9.00 0.00 40.00 0.00 1.20 1.00 11.25 13.50 27.00 27.00 ACRE Operating Capital DOL 189.34 C. TOTAL VARIABLE OPERATING COSTS D. FIXED OPERATING COSTS $391.93 Tractor/Machinery ACRE 1.00 35.00 35.00 0.00 125.00 0.00 ACRE Land Ownership Cost ACRE 1.00 391.93 0.00 0.00 0.08 31.35 $66.35 $458.28 General Overhead DOL E.TOTAL FIXED COSTS E. TOTAL COST OF ALL SPECIFIED EXPENSES SOYBEANS, CONVENTIONAL TILLAGE NORTH ALABAMA UNIT ACRE PRICE OFR QUANTITY COSTIUNIT TOTAL PER ACRE 400.00 A. GROSS REVENUE B. OPERATING EXPENSES 50.00 8.00 Seed & Inoculant Fertilizer BAG 1.25 50.00 62.50 60.00 60.00 0.33 1.00 1.00 1.00 1.00 0.00 0.00 50.00 50.00 0.49 0.49 35.00 30.00 8.00 14.00 0.00 6.00 12.00 0.00 0.25 20.00 UNITS UNITS TONS ACRE ACRE ACRE ACRE 29.40 29.40 11.55 30.00 Lime (Prorated) 8.00 14.00 0.00 0.00 0.00 0.00 12.50 20.00 0.00 40.00 13.50 27.00 Fungicides Consultant/Scouting Fee ACRE AC/IN Crop Insurance Aerial Application Land Rent Labor (Wages & Fringe) Tractor/Machinery Interest on Operating BU. ACRE ACRE ACRE HOUR ACRE 0.00 1.00 1.20 1.00 5.00 40.00 11.25 27.00 148.93 0.0700 10.42 C. TOTAL VARIABLE COST D. FIXED COSTS $308.27 TRACTORMACHINERY ACRE IRRIGATION LAND OWNERSHIP COST 1.00 0.00 35.00 125.00 35.00 0.00 0.00 24.66 $59.66 $367.94 ACRE 1.00 308.27 ACRE GENERAL OVERHEAD DOL 0.00 0.08 E. TOTAL FIXED COSTS F. TOTAL COST OF ALL SPECIFIED EXPENSES 1. USING THE CORN AND SOYBEAN BUDGET CONSTRUCT 2 WHOLE FARM PLANS USING THE FOLLOWING DATA PLAN1 200 ACRE CORN 200 ACRES OF SOYBEANS PLAN 2 150 ACRES OF CORN 250 ACRES OF SOYBEANS SET UP YOUR FARM PLAN USING PLAN 1 AND PLAN 2 ACREAGES, CONSIDER (EXCEL SUGGESTED GROSS INCOME Corn Soybeans TOTAL GROSS INCOME VARIABLE COSTS Corn Soybeans TOTAL VARIABLE COSTS GROSS MARGIN (RETURNS ABOVE VARIABLE COSTS) OTHER EXPENSES IF ANY TOTAL OTHER EXPENSES NET FARM INCOME 10% REDUCTION IN GROSS INCOME REVISED NET FARM INCOME PLAN 1 PLAN2

Answer 1

Plan-1 (S 180,000.00 80,000.00 260,000.00 Plan-2 (S 135,000.00 100,000.00 235,000.00 GROSSINCOME a. Corn ($900 per acre ans ($400 per acre) C. TOTALGROSS INCOME (a+b d. VARIABLE COST e. Corn($391.93 per acre 78,386.00 61,654.00 140,040.00 h. GROSS MARGINS(RETURNS ABOVE VARIABLE COST)(c-119,960.00 25,202.00 25,202.00 94,758.00 11,996.00 82,762.00 58,789.50 77,067.50 135,857.00 99,143.00 24,867.50 24,867.50 74,275.50 9,914.30 64,361.20 ans ($308.27 per acre) TOTAL VARIABLE COST (e+f i. Other expenses ifany (fixed costs TOTAL OTHER EXPENSES k. NET FARMINCOME I. 10% REDUCTION IN GROSS INCOME(h*10% m. REVISED NET FARMINCOME

Working notes PLAN-1 200 acre 200 acre PLAN-2 150 acre 250 acre Corn Soybeans Fixed cost Plan-1 Plan-2 Corn 13270 9952.5 Soybean 11932 14915 Total 25202 24867.5 Note: Fixed costs are considered as other expenses Instead ofthat we can ignore Tractor/Machineryexpenses as these are common in both the cases