Dollars and cents of Poultry Production
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Transcript of Dollars and cents of Poultry Production
Dollars and Cents
Poultry Production
Why is It Important?
What Should be Included?
• Income– Eggs
• Different sizes
– Meat• Retired egg layers• Meat birds
• Expenses– Production– Processing/Marketing
What Expenses Should be Included?
Processing/Marketing
Classification of Costs• Variable
– Costs vary according to production units– What would be some variable expenses?
• Fixed– Costs don’t change and are same no matter
production units– What would be some fixed expenses?
Preparing for Budget
• Assumptions– Do some research
• Assumptions Needed for Egg Production?• Assumptions for Meat Birds?• Records help
– Production – Financial
Meet Joe and Sue
Example Egg Budget - IncomeEgg Production BudgetFrom PSU Farming Alternatives
Receipts Quantity Unit Price TotalJumbo or extra Large0 dozLarge 1,000 dozMedium 0 dozReceipts from Eggs1,000 doz 1.00$ 1,000$ Fowl Sold 0 lbs 0.05$ -$
1,000$
Example Budget – ExpenseChicks 105 bird 2.82$ 296$ Feed 63 cwt 29.00$ 1,827$ Advertising 30$ Electricity 100$ Supplies 202$ Repairs and maintenance 175$ Egg cartoning and packing 450$ Other
Total Variable Costs 3,080$ Returns over Variable Costs29,357$ Production and Marketing Expenses
Depreciation Calculation Original Sal. Useful Ann.
Equipment Cost ValueLife (Yrs.) Dep.
$500 $50 10 $45$2,500 $100 10 $240
$1 $1 1 $0$1 $1 1 $0$1 $1 1 $0
$285
Buildings$2,000 $250 15 $116.67
$500 $25 15 $31.67$1 $1 1 $0.00$1 $1 1 $0.00$1 $1 1 $0.00
$148.33
BrooderEgg Cooler
Equipment
Hen houseProcessing
Building
LaborFixed Costs Rate/Labor 134 hrs. 10 $1,340.00Insurance and taxes $155Real Estate $75Equipment Depreciation $285Building Depreciation $148Return to Labor and Mgmt. $1,000
$3,003$6,083
$167
Breakeven cost per dozen $6.08
(From (From
Total Fixed CostsTotal Costs
Net Income
A year later……….
Meat Bird Enterprise BudgetMeat Bird BudgetFrom PSU Farming Alternatives
Receipts Quantity Unit Price TotalDressed weight of birds 4.75 lbsBirds processed per batch 75 birdsNumber of batches per year 5Anticipated price per lb. lbs 6.00$ -$
Projected Income 10,688$
Meat Bird Variable ExpenseVariable CostsChicks 400 bird 2.82$ 1,128$ _________Feed 1,800 lbs. 0.18$ 324$ _________Marketing 450$ _________Processing Cost 0 bird 3.50$ -$ _________Electricity 200$ _________Supplies 550$ _________Repairs and maintenance 175$ _________Other
Total Variable Costs 2,827$ _________Returns over Variable Costs6,525$ _________
Depreciation Calculation Original Sal. Use.Equipment Cost Value Life Dep.
$500 $50 10 $45.00$700 $50 15 $43.33$500 $250 15 $16.67$500 $50 10 $45.00
$1 $1 1 $0.00$1 $1 1 $0.00
$150.00
Buildings$1,000 $250 10 $75.00$2,000 $100 15 $126.67
1 $0.00$201.67Building
Processing
Equipment
Hen House
Washing Freezer
BrooderPlucker
Meat Bird Fixed Costs
Labor hrInsurance and taxes $155Real Estate $75Equipment Depreciation $150Building Depreciation $203Return to Labor and Mgmt. $5,000
$5,583$8,918
$1,770
Breakeven cost per lb. $5.01
Total Costs
Net Income
(From
Total Fixed Costs
(From
The Reward
• What can I expect to earn?• What is it going to cost me to produce and sell?
Assignment
• Complete either budget • Due next week