Cost

[Caustic Burno]

Thanks to everyone that shared their costs. One question I have is how do you figure the price of equipment? Just depreciate it over 5 or 10 years? And then after that just use the cost of repairs and maintenance?

Hay paid for all my equipment back in the day. Again my new tractor is an 07.
Today they pay for the maintenance and repairs.

 

[Bright Raven]

Just get a job in town and pay for the equipment out of it. Keeps the cost of running the cattle down since it doesnt need to come out of that pot.

:lol:

That is exactly what folks do! We had a county extension training session on farm profit. I was amazed at how many in the class did not consider that an expense if they paid for it off the farm.

 

[Caustic Burno]

Just get a job in town and pay for the equipment out of it. Keeps the cost of running the cattle down since it doesnt need to come out of that pot.

:lol:

That is exactly what folks do! We had a county extension training session on farm profit. I was amazed at how many in the class did not consider that an expense if they paid for it off the farm.

Bet they deducted it off their taxes as an expense.

 

[Bright Raven]

Just get a job in town and pay for the equipment out of it. Keeps the cost of running the cattle down since it doesnt need to come out of that pot.

:lol:

That is exactly what folks do! We had a county extension training session on farm profit. I was amazed at how many in the class did not consider that an expense if they paid for it off the farm.

Bet they deducted it off their taxes as an expense.

CB, I bet most do, but the county agent was flabbergasted that some who attended did not know you could depreciate fencing for example, etc. Some of the comments indicated a poor understanding of farm accounting and tax preparation. It is a fact, that the general knowledge on this forum, is far advanced than the average farmer in this county.

 

[Caustic Burno]

That is exactly what folks do! We had a county extension training session on farm profit. I was amazed at how many in the class did not consider that an expense if they paid for it off the farm.

Bet they deducted it off their taxes as an expense.

CB, I bet most do, but the county agent was flabbergasted that some who attended did not know you could depreciate fencing for example, etc. Some of the comments indicated a poor understanding of farm accounting and tax preparation. It is a fact, that the general knowledge on this forum, is far advanced than the average farmer in this county.

That pesky IQ failure can sure be costly in the stupid tax column.

 

[Stocker Steve]

Thanks to everyone that shared their costs. One question I have is how do you figure the price of equipment? Just depreciate it over 5 or 10 years? And then after that just use the cost of repairs and maintenance?

The standard here is to charge 10% of equipment value each year (regardless of how long you have had it) against the appropriate enterprise. That may seem a tad high, but you could have making more than that in the market most years. So I think of the 10% charge as an opportunity cost.

If you have multiple enterprises (like hay making, cow/calf, back grounding...) then you have to prorate shared equipment. Filling out the spread sheet is a little work, but it is a good thought process to go through. Who gets charged for the $ 100,000 loader tractor, the 3/4 ton truck, the horses, and the UTE? :cowboy:

 

[sim.-ang.king]

But what is your cost per calf weaned? It's one thing to have cows standing in your pasture for x amount of dollars, but if they don't weaning a calf, they aren't really being profitable even if you farm shows a profit.

 

[TexasBred]

But what is your cost per calf weaned? It's one thing to have cows standing in your pasture for x amount of dollars, but if they don't weaning a calf, they aren't really being profitable even if you farm shows a profit.

As complicated as some want to make it you can still keep books on a business with a good cigar box. :nod:

 

[bball]

But what is your cost per calf weaned? It's one thing to have cows standing in your pasture for x amount of dollars, but if they don't weaning a calf, they aren't really being profitable even if you farm shows a profit.

I track it slightly differently for the cows. I call it average dollars per day. I take the sale price of the calf and divide by the total number of days until the calf is weaned. I also take the calf weight and divide it by total number of days until weaned. These 2 numbers can really help indicate which cows produce heavier calfs and also higher quality calfs. You can start to see trends pretty quickly like this.

Cows that consistently hang near the bottom are elevated on cull list.

 

[ALACOWMAN]

The cost of the cow should be pretty much the same with the calf... Our job is to provide for the cows needs.. her job is raising that calf...

 

[Dave]

I never figure a cost for my labor. My labor gets paid based on the difference between dollars going out and dollars coming in. Some years I get paid real well. Others not so much.........

 

[bball]

The cost of the cow should be pretty much the same with the calf... Our job is to provide for the cows needs.. her job is raising that calf...

Agreed. For overall profitability, I figure cost per day (or cost per year as some prefer) to maintain a cow just as CB does. I also track some other numbers as indicated in my previous post to attempt to gauge individuals that shine and those that need to be improved upon.

 

[Stocker Steve]

But what is your cost per calf weaned?

Good to know. Even better to know is gross margin per acre. Most of us are not doing a great job of focusing on the more profitable enterprises. I have not finished my 2016 numbers, but I expect replacements will end up as the most profitable per acre this year.

 

[Bigfoot]

It's looking like I'm going to land at 1.14 per day. That's $415 per year, for every cow I own. That figure would not include any labor. For what may be the first time in my life, I have not hired any labor. I guess the kids got big enough, they were enough extra hands.

 

[Caustic Burno]

It's looking like I'm going to land at 1.14 per day. That's $415 per year, for every cow I own. That figure would not include any labor. For what may be the first time in my life, I have not hired any labor. I guess the kids got big enough, they were enough extra hands.

:tiphat: That’s pretty good.

 

[True Grit Farms]

It's looking like I'm going to land at 1.14 per day. That's $415 per year, for every cow I own. That figure would not include any labor. For what may be the first time in my life, I have not hired any labor. I guess the kids got big enough, they were enough extra hands.

Do you give the money on the hunting rights to the cows? From what I gather we run a very similar operation. My deer hunters make a difference major difference on my cow expenses.

 

[Bigfoot]

It's looking like I'm going to land at 1.14 per day. That's $415 per year, for every cow I own. That figure would not include any labor. For what may be the first time in my life, I have not hired any labor. I guess the kids got big enough, they were enough extra hands.

Do you give the money on the hunting rights to the cows? From what I gather we run a very similar operation. My deer hunters make a difference major difference on my cow expenses.

I do not. I try very hard, not to add any money to the farm account.

 

[ez14.]

It's looking like I'm going to land at 1.14 per day. That's $415 per year, for every cow I own. That figure would not include any labor. For what may be the first time in my life, I have not hired any labor. I guess the kids got big enough, they were enough extra hands.

You still need to add labor expenses! Your labor!

 

[snoopdog]

I'm curious , what percentage of winter feeding cost is , of your yearly cost. Be interesting to see the differences , in locales.

 

[RanchMan90]

I'm curious , what percentage of winter feeding cost is , of your yearly cost. Be interesting to see the differences , in locales.

Winter costs 40-50% of annual cost in Oklahoma. In my opinion