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Farm Management, Production & Resource Economics

1. The document discusses concepts related to depreciation, net worth statements, income statements, and farm planning. It defines depreciation and lists its objectives and common methods. 2. Net worth statements and income statements are summarized - net worth statements show the financial position of a business while income statements show revenues, expenses and profits over time. 3. The key steps of farm planning are outlined as preparing maps, recording farm history, planning labor needs, optimal land use, livestock programs, and marketing strategies. Characteristics of a good farm plan include being written and flexible.

Educationβ—¦
Sumit [Type the company name] AG ECON 302 Practical Record Farm Management, Production & Resource Economics Submitted to Dr. Janailin.S. Papang COA, CCS HAU, Hisar Submitted by Sumit Jangra 2015A58BVI AG ECON 302
2 AG ECON 302 | Farm Management Depreciation Concept A permanent fall in the value of fixed assets arising through wear and tear from the use of those assets in business. Definition Depreciation is a measure of the wearing out, consumption or other loss of value of depreciation asset arising from use, efflux ion of time or obsolescence through technology and market changes. Depreciation is allocated so as to charge a fair proportion of the depreciable amount in each accounting period during the expected useful life of the asset. Depreciation includes amortization of assets whose useful life is predetermined. Objectives 1. To calculate proper profits. 2. To show the asset at its reasonable value 3. To maintain the original monetary investment of the asset intact. 4. Provision of depreciation results in some incidental advantages also. 5. To provide for replacement of an asset. 6. Depreciation is permitted to be deducted from profits for tax purposes. Methods Of Depreciation a. Straight line method Under this method, the same amount of depreciation is charged every year throughout the life of the asset. π΄π‘›π‘›π‘’π‘Žπ‘™ π·π‘’π‘π‘Ÿπ‘–π‘π‘–π‘Žπ‘‘π‘–π‘œπ‘› = π‘‚π‘Ÿπ‘–π‘”π‘–π‘›π‘Žπ‘™ πΆπ‘œπ‘ π‘‘ βˆ’ π½π‘’π‘›π‘˜ π‘‰π‘Žπ‘™π‘’π‘’ πΈπ‘ π‘‘π‘–π‘šπ‘Žπ‘‘π‘’π‘‘ 𝐿𝑖𝑓𝑒 b. Declining charge method or diminishing ο‚· Some assets become quite old are normally used for down grading. ο‚· Under this method depreciation is charged at fixed rate on the reducing balance every year. π΄π‘›π‘›π‘’π‘Žπ‘™ π·π‘’π‘π‘Ÿπ‘–π‘π‘–π‘Žπ‘‘π‘–π‘œπ‘› = π‘…π‘’π‘šπ‘Žπ‘–π‘›π‘–π‘›π‘” π‘‰π‘Žπ‘™π‘’π‘’ Γ— π‘…π‘Žπ‘‘π‘’ π‘œπ‘“ π·π‘’π‘π‘Ÿπ‘–π‘π‘–π‘Žπ‘‘π‘–π‘œπ‘›(%) π‘‰π‘Žπ‘™π‘’π‘’ π‘Žπ‘“π‘‘π‘’π‘Ÿ π‘‘π‘’π‘π‘Ÿπ‘–π‘π‘–π‘Žπ‘‘π‘–π‘œπ‘› = π‘…π‘’π‘šπ‘Žπ‘–π‘›π‘–π‘›π‘” π‘‰π‘Žπ‘™π‘’π‘’ βˆ’ 𝐴𝑛𝑛𝑒𝑙 π·π‘’π‘π‘Ÿπ‘–π‘π‘–π‘Žπ‘‘π‘–π‘œπ‘› c. Sum of years digit method Depreciation , where the amount of depreciation goes on decreasing in the coming years. Sum of the digits used in the life of assets. π΄π‘›π‘›π‘’π‘Žπ‘™ π·π‘’π‘π‘Ÿπ‘–π‘π‘–π‘Žπ‘‘π‘–π‘œπ‘› = (π‘‚π‘Ÿπ‘–π‘”π‘–π‘›π‘Žπ‘™ πΆπ‘œπ‘ π‘‘ βˆ’ π½π‘’π‘›π‘˜ π‘‰π‘Žπ‘™π‘’π‘’) π‘…π‘’π‘šπ‘Žπ‘–π‘›π‘–π‘›π‘” π‘Œπ‘’π‘Žπ‘Ÿπ‘  π‘œπ‘“ 𝐿𝑖𝑓𝑒 π‘†π‘’π‘š π‘œπ‘“ π‘Žπ‘™π‘™ 𝑑𝑕𝑒 𝑑𝑖𝑔𝑖𝑑𝑠 π‘œπ‘“ π‘Ÿπ‘’π‘šπ‘Žπ‘–π‘›π‘–π‘›π‘” 𝑙𝑖𝑓𝑒
3 AG ECON 302 | Farm Management Net Worth Statement/ Balance Sheet ο‚· Shows financial condition or stability of a business at any point of time ο‚· Shows if the assets of a farmer are more/less than liabilities i.e. the Net worth of your business Net worth = Assets - liabilities Net worth > 0 ;Business is Solvent Net worth < 0 ;Business is Insolvent/ Bankrupt Net worth: Higher the value- better for business ASSETS When you have something that has a market value: Its your asset Types of Assets Long term/ Fixed Assets: Difficult to convert them into cash to meet the current obligations Ex: Land, farm buildings Intermediate/Working Assets : Morel liquid than fixed assets Ex: machinery, equipment, livestock Current Assets : Most liquid and are consumed every year Ex: Seeds, agrochemicals, cash in hand, bills receivable, livestock for sale LIABILITIES When you owe money to others: its your liability Types of Liabilities Long term/ Fixed Liabilities: Loans that do not require payment every year. Ex: Long term loans Intermediate/Working Liabilities: These liabilities can be postponed for the next year Ex: machinery loan, livestock loan Current Liabilities : Most liquid and are consumed every year Ex: Seeds, agrochemicals, cash in hand, bills receivable, livestock for sale
4 AG ECON 302 | Farm Management Rameshwar Farms Balance Sheet Date: June 30, 2019 Assets 2020 2019 Current Assets Cash 11,874 Accounts receivable Inventory Prepaid expenses Short-term investments Total current assets INR 11,874.00 INR 0.00 Fixed (Long-Term) Assets Long-term investments 1,208 Property, plant, and equipment 15,340 (Less accumulated depreciation) (2,200) Intangible assets Total fixed assets INR 14,348.00 INR 0.00 Other Assets Deferred income tax Other Total Other Assets INR 0.00 INR 0.00 Total Assets INR 26,222.00 INR 0.00 Liabilities and Owner's Equity Current Liabilities Accounts payable 8,060 Short-term loans Income taxes payable 3,145 Accrued salaries and wages Unearned revenue Current portion of long-term debt Total current liabilities INR 11,205.00 INR 0.00 Long-Term Liabilities Long-term debt 3,450 Deferred income tax Other Total long-term liabilities INR 3,450.00 INR 0.00 Owner's Equity Owner's investment 7,178 Retained earnings 4,389 Other Total owner's equity INR 11,567.00 INR 0.00 Total Liabilities and Owner's Equity INR 26,222.00 INR 0.00 Common Financial Ratios Debt Ratio (Total Liabilities / Total Assets) 0.56 Current Ratio (Current Assets / Current Liabilities) 1.06 Working Capital (Current Assets - Current Liabilities) 669 - Debt-to-Equity Ratio (Total Liabilities / Owner's Equity) 1.27
5 AG ECON 302 | Farm Management Income Statement ο‚· It presents financial record of a company’s revenues and expenses, and profits over a period of time. ο‚· It also gives firm’s financial performance in terms of revenues, expenses, and profits over a given time period. ο‚· It also gives firm’s financial performance in terms of revenues, expenses, and profits over a given time period. ο‚· The operating section of an income statement includes revenue and expenses. ο‚· The non-operating section includes revenues and gains from non-primary business activities also expenses that are either unusual or infrequent, finance costs like interest expense, and income tax expense. Usefulness ο‚· Evaluate past performance. ο‚· Predicting future performance. ο‚· Help assess the risk or uncertainty of achieving future cash flows. Harikishan Farm Income Statement For the Years Ending July 1, 2020 and June, 2019] Revenue 2020 2019 Crop Sale revenue INR 110,000 INR 95,000 (Less sales returns and allowances) Milk Sale Revenue INR 70,000 INR 62,000 Interest revenue Other revenue Total Revenues INR 180,000 INR 157,000 [42] Expenses Seed INR 1,000 INR 1,000 Fertilizer Insecticide Pesticide INR 65,000 INR 63,000 Labour Ploughing Sowing INR 8,000 Weeding Irrigation INR 4,200 INR 5,200 Fencing Petrol Repairings
6 AG ECON 302 | Farm Management Rent Salaries and wages INR 55,000 INR 55,000 Other INR 17,460 Total Expenses INR 142,660 INR 132,200 Net Income Before Taxes INR 37,340 INR 24,800 Income tax expense INR 14,936 INR 9,920 Income from Continuing Operations INR 22,404 INR 14,880 {42} [42] Below-the-Line Items Income from discontinued operations Effect of accounting changes Extraordinary items Net Income INR 22,404 INR 14,880
7 AG ECON 302 | Farm Management FARM PLANNING ο‚· All planning is a matter of forecasting. ο‚· It is an attempt to state logically in conformity with the economic principles as to what will happen in the future. ο‚· Evidently planning is to serve as a blue print for the future. ο‚· Farm planning is a process to allocate the scare resources of the farm to organize the farm production in such a way as to increase the resource use efficiency and the income of the farmer. ο‚· Farm planning is process of deciding in the present what to do in the future about the best combination of crops and livestock to be raised through rational use of resources. ο‚· Farm planning is mainly a process of choice making or choosing from among competitive alternatives. It is concerned with various adjustments the farmer makes in the existing organizations. Objective of Farm Planning 1. The immediate objective of farm planning is to maximize the annual net income sustained over a long period of time. 2. The maximization of net income through improved resource use planning. 3. The ultimate objective of farm planning is improvement in the Standard of living of the farmer. Importance of Farm Planning 1. If necessity is the mother of invention, scarcity of resources is the mother of farm planning. 2. The fact of scarcity makes it necessary for the farmer to make the most what he has in their efficient utilization. 3. Farmer can make optimum utilization of scarce productive resources. STEPS OF FARM PLANNING To have a best farm plan, some steps are needed to follow while farm planning is prepared. They are 1. Preparing the farm map: The general lay out of the farm, number and shape, irrigation channels can be shown in the farm map. 2. Recording the History of the Farm: It is very important to obtain the information pertaining to utilization of resources and their efficiency. What was the crop rotations followed previously, etc on the basis of this information planning in respect of crops to be grown, crop rotations to be followed; requirement of credit along with their sources etc can be possible. 3. Planning Bullock and Human Labour Requirement: Next a calendar of farm operations should be prepared and bullock and human labour requirements determined for different months. A labour schedule should be developed as to guide a farmer to appraise the amount of labour need in relation to the availability. 4. Planning the Land Use and Soil Conservation practices:
8 AG ECON 302 | Farm Management When a full picture of the resources and their appraisal is obtained, the next step in farm planning is to adopt such practices which would lead to the best use of land. While planning the cropping scheme, due importance should be given for soil conservation. Therefore purposively crops and crop rotations need to be introducing a plan which will enhance soil conservation. 5. Planning Livestock Programme: Livestock and crop production is having supplementary relationship. The size of livestock depends upon size of farm, cropping intensity, availability of irrigation etc. If irrigation water is ample naturally cultivator can grow fodder crops through out year and he can maintain milch animals more. 6. Planning the Marketing of Produce: Only production is not sufficient to maximize the returns, good price for the produce is also important. Therefore, study of market conditions, prices etc. are essential to decide the time of selling. Similarly the agency through which marketing is to be done must be identified in view of getting maximum shares in consumer’s price. Characteristics of Good farm plan 1. It is should be written. 2. It should be flexible. 3. It should provide for efficient use of resources. 4. Farm plan should have balanced combination of enterprises. Such combination in turn ensures, a. Production of food, cash and fodder crops. b. Maintain soil fertility. c. Increase in income. d. Improve distribution of and use of labour, power and water requirement throughout the year. 5. Avoid excessive risks. 6. Utilize farmer’s knowledge and experience and take account of his likes and dislikes. 7. Provide for efficient marketing. 8. Provision for borrowing, using and repayment of credit. 9. Provide for the use of latest technology.
9 AG ECON 302 | Farm Management FARM BUDGETING ο‚— After farm planning budgeting is undertaken. ο‚— Budgeting is a method of analyzing plans for the use of agricultural resources at the command of the decision maker. ο‚— Farm plan is a programme of the total farm activity of a farmer drawn up in advance. Farm plan serves as the basis of farm budgeting. ο‚— Therefore farm plan can be prepared without a budget but budgeting is not possible without farm plan. Therefore the budgeting can be defined as under. Characteristics 1. The physical aspects of farm planning when expressed in monetary terms called budgeting. 2. The expression of farm plan in monetary terms by estimation of receipts, expenses and net income is called budgeting. 3. Farm budgeting is a process of estimating costs, returns and net profit of a farm or a particular enterprise. 4. Budget is a statement of estimated income and expenditure. Types of farm budgeting a) Partial budgeting:  It refers to estimating costs and returns and net income of a particular enterprise. It refers to estimating the returns for a part of the business i.e. one or few activities for example 1. To estimate additional cost and returns from growing one hectare of hybrid Jowar in place of local Jowar. 2. To estimate additional cost and returns by adopting foliar application of chemical fertilizers instead of soil application. b) Complete Budgeting: ο‚— It is also called as total budgeting. ο‚— It refers to preparing budget for the farm as a whole. ο‚— Complete budgeting considers all the crops, livestock, methods of production and aspects of marketing in consolidated form and estimates costs and returns for the farm as a whole. ο‚— Therefore complete budgeting can be specifically defined as ο‚— β€œAn estimation of the probable income and expenditure is made for the farm as a single unit of course, a complete budget is required when a farm plan is prepared for new farm or when drastic changes are suggested in the plan of the existing pattern on an established farm”. ο‚— Complete budgeting can be prepared for short run (annual budget) and for long run. Advantages of Farm Budgeting ο‚— It evaluates the old plan and guides the farmers to adopt a new farm plan with advantage.
10 AG ECON 302 | Farm Management ο‚— It makes the farmer conscious of the waste (leakage) in the farm business. ο‚— It gives comparative study of receipts, expenses and net earnings on different farms in the same locality and in different localities for formulating national agricultural policies. ο‚— It guides and encourages the most efficient and economical use of resources. ο‚— It serves as valuable basis for improvements in farm management practices.
11 AG ECON 302 | Farm Management Least Cost Combination A rational firm would combine the various factors of production its production function in such a way that with the minimum input and maximum output is obtained at the minimum cost. Such a combination is referred to as the least cost combination. The least cost combination may be stated π‘€π‘Žπ‘Ÿπ‘”π‘–π‘›π‘Žπ‘™ π‘π‘Ÿπ‘œπ‘‘π‘’π‘π‘‘π‘–π‘£π‘–π‘‘π‘¦ π‘œπ‘“ 𝑋1 π‘ƒπ‘Ÿπ‘–π‘π‘’ π‘œπ‘“ 𝑋1 = π‘€π‘Žπ‘Ÿπ‘”π‘–π‘›π‘Žπ‘™ π‘π‘Ÿπ‘œπ‘‘π‘’π‘π‘‘π‘–π‘£π‘–π‘‘π‘¦ π‘œπ‘“ 𝑋2 π‘ƒπ‘Ÿπ‘–π‘π‘’ π‘œπ‘“ 𝑋2 Principle of least cost combinations 1. Marginal Rate of Substitution (MRS) = π‘π‘’π‘šπ‘π‘’π‘Ÿ π‘œπ‘“ 𝑒𝑛𝑖𝑑 π‘œπ‘“ π‘Ÿπ‘’π‘π‘™π‘Žπ‘π‘’π‘‘ π‘Ÿπ‘’π‘ π‘œπ‘’π‘Ÿπ‘π‘’ (π‘₯2) π‘π‘’π‘šπ‘π‘’π‘Ÿ π‘œπ‘“ 𝑒𝑛𝑖𝑑 π‘œπ‘“ π‘Žπ‘‘π‘‘π‘’π‘‘ π‘Ÿπ‘’π‘ π‘œπ‘’π‘Ÿπ‘π‘’ (π‘₯1) 2. Price Ratio (PR) = πΆπ‘œπ‘ π‘‘ π‘π‘’π‘Ÿ 𝑒𝑛𝑖𝑑 π‘œπ‘“ π‘Žπ‘‘π‘‘π‘’π‘‘ π‘Ÿπ‘’π‘ π‘œπ‘’π‘Ÿπ‘π‘’ πΆπ‘œπ‘ π‘‘ π‘π‘’π‘Ÿ 𝑒𝑛𝑖𝑑 π‘œπ‘“ π‘Ÿπ‘’π‘π‘™π‘Žπ‘π‘’π‘‘ π‘Ÿπ‘’π‘ π‘œπ‘’π‘Ÿπ‘π‘’ Graphical Method
12 AG ECON 302 | Farm Management Fencing In agriculture, fences are used to keep animals in or out of an area. They can be made from a wide variety of materials, depending on terrain, location and animals to be confined. Most agricultural fencing averages about 4 feet (1.2 m) high, and in some places, the height and construction of fences designed to hold livestock is mandated by law. A fencerow is the strip of land by a fence that is left uncultivated. It may be a hedgerow or a shelterbelt (windbreak) or a refugee for native plants. If not too narrow, it acts as a habitat corridor. Determining the Cost of Fencing of the Farm Title: Determining the cost of barbed wire fencing of the farm having length and breadth in 3: 2 ratio. Purpose: 1. To determine the requirement of angle iron and barbed wire for fencing. 2. To determine the cost of fencing. Procedure: One acre area = 4046.724 sq. meters 100 acres farm area = 404672.4 m2 The length and breadth of the given farm is 3: 2 ratio Let the length of the farm in meters = 3x Therefore, 3x x 2x = 404672.4 m2 6x2 = 404672.4 m2 X2 = 67445.4 m2 x = 259.7 m Actual length of farm = 259.7 x 3 = 779 m; Width = 259.7 x 2 = 519.4 m Perimeter of the Farm = 2 x (3x + 2x) = 6x + 4x = 10x (779 + 519.4) X 2 = 2596.8 m. = 2597 m. Cost of fencing per running meter perimeter of the farm = 5, 50,920 Γ· 2,597 = Rs. 212.1 The cost of fencing would depend upon several factors like cost of barbed wire, labour charges etc. (779 + 519.4) X 2 = 2596.8 m. = 2597 m. 1. Cost of wire: If number of strands be four, the length of wire needed = 2,597 x 4 = 10,388 m Cost of wire @ Rs 6,000/bundle of 365 m = 10,388/ 365 x 6,000 = Rs 1, 70,762. 2. Number of angle iron for poles: Distance between two poles 5 Number of poles = Perimeter of farm/ Distance between two poles + 8 poles at corners = 2597/5 + 8 = 527 poles
13 AG ECON 302 | Farm Management Cost of 527 poles @ Rs 500 each = Rs 527 x 500 = Rs 2, 63,500. 3. Cost of digging pits for fixing poles: Size of pit = 0.3 x 0.3 x 0.45 m = 0.04 m3 Total volume of pits to be dug = 527 poles x .04 m3 = 21.08 m3 Cost of digging the pit @ Rs 200 per m3 = Rs 21.08 x 200 = Rs 4,216. 4. Cost of concrete and lime: Assuming 1 m3 of concrete and lime costs Rs 600 The cost of concrete and lime for 21.08 m3 volume of pits = 21.08 x 600 = Rs 12,648. 5. Labour charges for filing concrete and lime @ Rs 180 per m’ = 21.08 x 180 = Rs 3,794. 6. Cost of iron gates: Cost of 4 iron gates at the rate of Rs 15,000 each = Rs 60,000. 7. Labour charges for stretching and fixing wire: Number of labourers 10 for 20 days Wages @ Rs 180 per labour/day 10 labourers x 180 per day x 20 days = Rs 36,000. Summary of total Expenses: Cost of fencing per running meter perimeter of the farm = 5, 50,920 Γ· 2,597 = Rs. 212.1 The cost of fencing would depend upon several factors like cost of barbed wire, labour charges etc.
14 AG ECON 302 | Farm Management Farm Layout A Farm layout refers to the compiling of physical structures such as homesteads, outbuildings, waterways, contours, water supply roads and the layout of orchards, vineyards etc. Need for Planning ο‚· Farming is a competitive business. Producers in each state, region, and country compete for their share of local and national markets. ο‚· Farmers, if they expect to operate at a maximum profit and compete for their share must have their farm, buildings, and equipment arranged and designed for the highest possible operating efficiency ο‚· Planning is needed to reduce labour costs ο‚· In many enterprises, such as dairying and fruit and vegetable production, labour represents 40 to 70 per cent of the cost of production. ο‚· arrangement of their farm results in efficient use and maximum returns from labour. e.g. : A Vermont dairy farmer with a herd of 22 Jerseys rearranged his dairy barn and changed his chore routine to save two hours per day on his chores. This saving amounts to 730 hours, OR 2 MONTHS AND 13 DAYS MAN LABOR SAVED IN A YEAR'S TIME. Principle The first step in farm planning is choosing the system of farming. Farming practices associated with the system the farmer chooses will largely determine the farm and farmstead layout. For example, the arrangement of the farmstead and design of the buildings would be quite different on a dairy farm than on a farm where crops are the main enterprise Fig. Farm Layout
15 AG ECON 302 | Farm Management Features Efficient space utilization Real estate costs are rising by the day. An ideal layout should utilize the available space in an effective way. Wastage of space should be avoided at all costs. The arrangement of equipment, service points and workers should be done in such a way that space is properly utilized. Flexibility Manufacturing operations are dynamic in nature. There is continuous innovation in types of products manufactured as well as in equipment, techniques and processes of production. Therefore the layout should be designed in such a way that the layout is flexible enough to adapt to changes. Accessibility Manufacturing, maintenance and servicing facilities should be easily accessible without any hindrance. To achieve this purpose, there must be sufficient space between equipment so that raw materials, machines and men are able to move freely from one place to another. Economy in handling The layout should facilitate economies in handling materials, work-in-progress and finished stock. Handling should be reduced by the optimal use of trucks, lifts, conveyors etc. Minimum movement The layout should be so designed that there is, minimum movement of men and machines. Movements should be direct as far as possible. Indirect handling of materials would unnecessarily add to the cost without any value addition. Therefore indirect handling should be avoided as far as possible. Ensuring Co-ordination A good layout would be able to co-ordinate all operations. The layout should be designed taking into account the inter-relationships between various equipment, departments and personnel. It is therefore important that while planning the layout the complete picture of the organization is considered. Visibility Work should be arranged in such a way that there is no problem in supervision, co- ordination and control. Raw materials, work in progress and finished goods should have specific storage points and must be visible at all times. This would reduce the problem of pilferage, theft etc. Reduced discomfort The layout should be designed in a way that there is minimum discomfort to the workers. It should provide for proper lighting, ventilation and reduce the impact of heat, noise, vibrations, dust, fumes, odours etc.
16 AG ECON 302 | Farm Management Adherence to statutory regulations The layout should adhere to the regulations of the Factories Act with regard to health, safety and welfare of employees. Adherence to the above regulations would minimize accidents, reduce absenteeism due to sickness contributing to improved productivity Preservation of materials and equipment The layout should contain safeguards against fire, moisture, theft and general deterioration of equipment and materials. There should be adequate and safe storage locations. There should be provision for storing inflammable materials separately and in a safe manner
17 AG ECON 302 | Farm Management LAW OF EQUI-MARGINAL RETURNS Most of the farmers have limited resources. They have limited land, limited capital, limited irrigation facilities. Even the labour which is considered to be surplus becomes scarce during peak sowing, weeding and harvesting periods. Under such resource limitations, farmers must decide how a limited amount of input should be allocated or divided among many possible uses or alternatives. For example farmer has to decide on the best allocation of fertilizer between different crops and feed between different types of livestock. In addition, limited capital must be allocated to the purchase of fertilizers, seeds, feed etc. The equi-marginal principle provides guidelines for the rational allocation of scare resources.The principle says that returns from the limited resources will be maximum if each unit of the resource should be used where it brings greatest marginal returns. Statement of the law A limited input should be allocated among alternative uses in such a way that the marginal value products of the last unit are equal in all its uses. Example A farmer has Rs. 3000/- and wants to grow sugarcane, wheat and cotton. What amount of money be spent on each enterprise to get maximum profits. The first Rs. 500 would be allocated to sugarcane as it has the highest MVP. The second dose of Rs. 500 would be allocated to wheat as its MVP is higher than that of cotton and sugarcane. In the same way, third would be used on sugarcane, the fourth,fifth and the sixth on sugarcane, wheat and cotton respectively. Each successive Rs of 500 is allocated to the crop which has highest marginal value product remaining afterprevious allocation. The final allocation is Rs. 1500 on sugarcane, Rs 1000 on wheat and Rs. 500 on cotton.
18 AG ECON 302 | Farm Management References ο‚· https://agrimoon.com/wp-content/uploads/Production-Economics-Farm- Management.pdf&ved=2ahUKEwiV18vTucDsAhUhwTgGHXH6CTEQFjAAegQIARAB& usg=AOvVaw24XQhoTgWsV3-y4BOTOw8- ο‚· www.slideshare.net ο‚· https://www.yourarticlelibrary.com/dairy-farm-management/determining-the-cost- of-barbed-wire-fencing-of-the-farm/36517 ο‚· https://images.app.goo.gl/mAZneWNJ2PJ7C8z17 ο‚· https://www.vertex42.com/ExcelTemplates/income-statement.html ο‚· https://www.vertex42.com/ExcelTemplates/balance-sheet.html ο‚· https://agrimoon.com/production-economics-farm-management-icar-ecourse-pdf- book/ ο‚· https://www.slideshare.net/mobile/sarah_dc05/least-cost-combination