Help with Breakevens.....Excel.

[cornstalk]

Hello all....

Working on a breakeven form in excel tonight. Can anyone tell me how to figure "interest on cattle" ?

This form is for a class I'm taking......and theyre giving me an 8% interest rate on 2000 hd of 950lb steers, purchased for $106 cwt and fed over 96 days. The number they come up with on the example form is $21.79 per hd for the above figures. I havent been able to arrive at how this number was calculated. Anyone have any ideas ?

 

[ollie']

From what information you've provided their answer is wrong. Take your total cost per head,(1007dollars) multiply that by 8%. Divide that number by 365. That is the amount of interest per head per day. Multiply that by the number of days. I get 21.19. Of course it took me 12 years to get a 4th grade education.

 

[Bama]

You need to know the selling price then you can figure the percent rate. Im assuming they are asking for a annual percentage rate as they gave you the 96 days. Or you can turn the problem around since they gave you the actual percentage rate you can figure the selling price.

 

[ollie']

Is the selling price not 950 X 1.06? What am I missing here Bama? Are you saying you need to know the selling price after 96days feed? I don't see how that comes into the equation. I've never had a banker base my interest on my selling price.

 

[msscamp]

You need to know the selling price then you can figure the percent rate. Im assuming they are asking for a annual percentage rate as they gave you the 96 days. Or you can turn the problem around since they gave you the actual percentage rate you can figure the selling price.

No, you don't. Selling price has nothing to do with the interest rate on a loan to buy the cattle. The percent of interest is given at .08.

 

[cornstalk]

Thanks for all the prompt help gang...

Ollie, you nailed it on the head. The purchase price was actually 1065cwt or 1.065 which puts us right where we need to be using the formula you provided. I wasnt dividing by 365 and then multiplying by 96. I listed 106cwt as the purchase price in the original post just for ease of figuring......sorry bout that. Thanks a bunch for helping me out! (Math has never been my strong suite either) :cboy:

Still working on a few finishing touches.....but would be willing to share this with anyone interested. Drop me an email with your home addy, and I'll send it to you via email.

Our instructor wanted us to have this (excel breakeven chart) on our desktop for future use. Kind of handy....just change your inputs to reflect your situation....and it spits out your breakeven price.

Actually a real eye opener.... :shock:

 

[Bama]

You need to know the selling price then you can figure the percent rate. Im assuming they are asking for a annual percentage rate as they gave you the 96 days. Or you can turn the problem around since they gave you the actual percentage rate you can figure the selling price.

No, you don't. Selling price has nothing to do with the interest rate on a loan to buy the cattle. The percent of interest is given at .08.

Edited because my I hit the submit button to quickly.


My mistake, I reread the question And I see what you were talking about. I read it as if you buy at a price and then sell at another price. What would be the annual interest rate you made on your investment. I've been gone for 2 weeks and ain't reading everthing clearly.