INTRO AG Hw 3 .\" Chart A farmer in Lonoke, AR produces conventional corn with f

Question

INTRO AG Hw 3 ." Chart A farmer in Lonoke, AR produces conventional corn with furrow Irrigation. Table 1 shows the cost and revenue estimates for the upcoming 2018 cropping season. Table 1. Corn Enterprise Budget, Conventional, Furrow Irrigation Revenue (S/acre) Yield (bushels, bu.) Price (S/bu.) Total Crop Revenue 210 3.35 704 Costs (S/acre) Fertilizers & Nutrients Herbicides Insecticides Diesel Fuel Other inputs Total Variable Costs Total Fixed Costs Total Costs Source: 2018 Crop Production Budgets for Farm Planning. UofA Cooperative Extension Service 152 42 16 16 212 518 104 622

Explanation / Answer

Contribution per Acre = $704 (Total Crop Revenue) - $537 (Variable Cost per acre) Contribution per Acre = $167 Fixed Cost per acre = $160 BEP (in bu./acre) = $160 (Fixed Cost) / $167 (Contribution per acre) BEP (in bu./acre) = 0.958084 or say 0.96 bu./ acre (approx.)

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