This document provides information and examples for budgeting poultry production operations, including eggs and meat birds. It discusses the importance of budgets and outlines income and expenses that should be included. Key points include: - Income comes from egg and meat sales, while expenses include production costs like feed, chicks, and processing as well as fixed costs such as labor, equipment depreciation, and taxes. - Examples are given for egg and meat bird budgets showing projected income, variable costs, fixed costs, and net income calculations. Assumptions must be made for factors like production levels and prices. - Keeping good records of production and finances helps to accurately prepare and track budgets over time. The document concludes by noting

1. Dollars and Cents
Poultry Production

2. Why is It Important?

3. What Should be Included?
• Income
– Eggs
• Different sizes
– Meat
• Retired egg layers
• Meat birds
• Expenses
– Production
– Processing/Marketing

4. What Expenses Should be Included?

5. Processing/Marketing

6. 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?

8. Preparing for Budget
• Assumptions
– Do some research
• Assumptions Needed for Egg Production?
• Assumptions for Meat Birds?
• Records help
– Production
– Financial

9. Meet Joe and Sue

10. Example Egg Budget - Income
Egg Production Budget
From PSU Farming Alternatives
Receipts
Quantity
Jumbo or extra Large0
Large
1,000
Medium
0
Receipts from Eggs
1,000
Fowl Sold
0
Unit Price
doz
doz
doz
doz $ 1.00
lbs
$ 0.05
Total
$ 1,000
$
$ 1,000

11. Example Budget – Expense
Chicks
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 Variable29,357
$ Costs

12. Depreciation
Calculation
Equipment
Original Sal.
Cost
Brooder
$500
Egg Cooler $2,500
$1
$1
$1
Useful Ann.
Life
Value
(Yrs.)
Dep.
$50
10
$45
$100
10
$240
$1
1
$0
$1
1
$0
$1
1
$0
Equipment
$285
Buildings
Hen house
Processing
$2,000
$500
$1
$1
$1
$250
$25
$1
$1
$1
Building
15 $116.67
15 $31.67
1
$0.00
1
$0.00
1
$0.00
$148.33

13. Fixed Costs
Labor
Insurance and taxes
Real Estate
Equipment Depreciation
(From
Building Depreciation(From
Return to Labor and Mgmt.
Labor
Rate/
134 hrs.
10
$1,340.00
$155
$75
$285
$148
$1,000
Total Fixed Costs
$3,003
Total Costs
$6,083
Net Income
$167
Breakeven cost per dozen $6.08

14. A year later……….

15. Meat Bird Enterprise Budget
Meat Bird Budget
From PSU Farming Alternatives
Receipts
Quantity
Dressed weight of birds
4.75
Birds processed per batch
75
Number of batches per year
5
Anticipated price per lb.
Unit Price
lbs
birds
lbs
$ 6.00
Total
$
-
Projected Income$ 10,688

16. Meat Bird Variable Expense
Variable Costs
Chicks
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 Costs_______
$ 6,525

17. Depreciation
Calculation
Equipment
Brooder
Plucker
Washing
Freezer
Original
Cost
$500
$700
$500
$500
$1
$1
Hen House
Processing
$1,000
$2,000
Sal.
Use.
Value Life
Dep.
$50
10
$45.00
$50
15
$43.33
$250
15
$16.67
$50
10
$45.00
$1
1
$0.00
$1
1
$0.00
Equipment
$150.00
Buildings
$250
$100
Building
10
15
1
$75.00
$126.67
$0.00
$201.67

18. Meat Bird Fixed Costs
Labor
Insurance and taxes
Real Estate
Equipment Depreciation
(From
Building Depreciation
(From
Return to Labor and Mgmt.
hr
$155
$75
$150
$203
$5,000
Total Fixed Costs
$5,583
Total Costs
$8,918
Net Income
Breakeven cost per lb.
$1,770
$5.01

19. The Reward
• What can I expect to earn?
• What is it going to cost me to produce and sell?

20. Assignment
• Complete either budget
• Due next week