AGR4701 Assignment 2 Memo (COMPLETE ANSWERS) Due 17 June 2025

Instructions • Assignment 2 contributes to your year mark. It is compulsory for all students, to submit this assignment before the due date to ensure that they build their year mark. • Attend your online classes to learn more about the module Part 2 – focus on operational cost 2.1 Human resource 2.1.1 Develop the job description for the supervisor with an annual payment package for his/her duties. (10) 2.1.2 Develop the job description guide for general farm workers for each of the two commodities. (15) 2.1.3 Create the practical daily operational activities of farmworkers by demonstrating activity for each of two commodities within normal working 8½ hours as required by South African or your residing country Labour law. Remember to factor the worker wage rate in Rand or other currency per hour by using the latest minimum wage for this year that is readily available at or labour site of residing country to sub-total of each activity. (15) 2.1.4 Based on the design job descriptions and daily activities, develop the yearly worksheet for estimated labour hours required to perform all activities of two chosen commodities. (10) 2.2 Determine the activity operational cost (financial cost for every work you do) for the proposed farming enterprise of two or more chosen commodities. In the case where you chose two plant commodities for your title, you should outline the activity operational cost of each commodity. Present your activities costs as follow: a) Description Quantity Unit price Sun-total 1 2.2.1 Animal commodities: a) Work out total annual feeding cost for all animals, medication, and veterinary cost. (5) b) Maintenance cost for farm structure like (camps, boreholes or water system, piggery houses, poultry house, milking parlour, silage storage cost). (5) c) Energy repayment (electricity or solar) and all other animals’ consumable expenses. (5) d) Workout the machinery cost for activities done on an animal section like: (preparation of silage, feeding activity using the tractor and implement by factoring the fixed cost of a tractor, implement, fuel, maintenance and repair cost). (10) e) Work out all activity transport costs considering the annual vehicles repayment, fuel, maintenance & repair and all assigned transport activities that occurred under the animal section. (5) f) Based on your answers for 2.1.1 to 2.1.4 above – on hours allocated for animal commodity, the job description of supervisor and farmworkers using practical daily operational activity hours; workout the monthly to annual human resource cost for animal section (considering peak work where extra workforce are required for temporary activities). (10) 2.2.2 Plant commodities a) Work out total crop activities: tilling, disc harrowing, planting, weeding, irrigation and harvesting cost for targeted plant annually if is spread over seasons. (5) b) Maintenance cost for farm structure like: (boreholes & irrigation system, hydroponics, net shading, tunnels, processing and package facility, cold storage and others that you know about). (5) c) Energy repayment (electricity or solar) and all other plants consumable expenses related to energy. (5) d) Workout the machinery cost for activities done on plant section like: (preparation of soil, organic or inorganic fertilizer and lime spread on-field activity using the tractor and implement by factoring the fixed cost of a tractor, implement, fuel, maintenance and repair cost). (10) Assessment 2 Unique no: 664595 Due: 17 June 2025 e) Work out all transport costs considering the annual vehicles repayment, fuel, maintenance & repair, and all assigned transport activities that occurred under the animal section. Your working should factor the size of truck capacity on how many tons can be transported at a time. Then consider target production in tons from planted space to determine how many deliveries may be required to transport all farm plant products. (5) f) Based on your answers for 2.1.1 to 2.1.4 – on hours allocated for plant commodity, the job description of supervisor and farmworkers using practical daily operational activity hours; workout the monthly to annual human resource cost for plant section (considering peak work where extra workforce are required for temporary activities). (10) 2.3 Develop the enterprise budget of each commodity according to the size of the production share on the farm. Refer to the example of enterprise budgets presented in your study guide. 2.3.1 Enterprise budget for commodity 1 (consider total capital requirements fund and all operational cost for this commodity). (10) 2.3.2 Enterprise budget for commodity 2 (consider total capital requirements fund and all operational cost for this commodity). (10) 2.4 Determine the breakeven point of each commodity production line to determine whether the farm will be run sustainably and profitably. 2.4.1 Break-even point for commodity 1 (10) 2.4.2 Break-even point for commodity 2 (10) There is a formula for calculating the breakeven point. But first, get to know the acronyms: Y = Breakeven point TFC = Total fixed cost To determine your fixed cost, use the total capital requirements under assignment 1 question 1.5. Use estimated loan interest rate and repayment period. Workout the fixed cost for each commodity to get you BEP right. AI = Average income per unit (Use the farm gate price or use latest published price (May 2025) for your commodity). AVC = Average variable cost per unit. (To get this right consider all operational cost presented on the enterprise budget for your commodities). TI = Total income (Total units produce from targeted production size x selling price per unit) TC = Total cost (Operational cost + Fixed cost) Break-even point formula: