Estimate the capital that will be required in establishing a one-hectare fruit farm based on the following data: Grafted planting materials: 250 seedlings @ P300/seedling Stakes: 250 pcs @ P2.50/pc Fertilizer: 1 bag @ P400/bag Pesticides: 1 kg Alliete @ P1,250/kg; 3 quarts Thiodan @ P250/qrt e. Land preparation: P3,500 Planting: Layout & staking – 3 man-days @ P350/man-day; hole digging & planting – 20 man-days @ P350/man-day Replanting: 1 man-day @ P350/man-day Fertilization: 5 man-days @ P350/man-day Weeding: Mowing – 12 man-days @ P350/man-day; Ringweeding – 30 man days @ P350/man-day Pruning: 4 man-days @ P350/man-day Irrigation: 12 man-days @ P350/man-day Pest control: 9 man-days @ P350/man-day Costs of equipment and tools Irrigation pump and fittings: P45,000 Brushcutter: P12,500 Sprayer: P3,500 Pruning shear: P350 Organization expenses and working capital Expenses for a feasibility study: P10,000 Business permit: P5,000 Working capital: P150,000 NOTE THAT: Operating costs are expenses incurred while running the business venture. Estimate the operating cost of a one-hectare fruit farm based on the following technical coefficients: Orchard maintenance: 60 man-days @ P350/man-day; starts on the first year of operation; assume a yearly increase of cost by 25% up to the fifth year; 30% increase in the succeeding years Repair of equipment and facilities: 5% of the value of fixed assets with moving parts (i.e., pump, brush cutter, and sprayer); no repairs in the first two years; 5% increase in the succeeding years Land rent: P4,500/year; starts on the first yea

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Estimate the capital that will be required in establishing a one-hectare fruit farm based on the following data:

Grafted planting materials: 250 seedlings @ P300/seedling
Stakes: 250 pcs @ P2.50/pc
Fertilizer: 1 bag @ P400/bag
Pesticides: 1 kg Alliete @ P1,250/kg; 3 quarts Thiodan @ P250/qrt e. Land preparation: P3,500
Planting: Layout & staking – 3 man-days @ P350/man-day; hole digging & planting – 20 man-days @ P350/man-day
Replanting: 1 man-day @ P350/man-day
Fertilization: 5 man-days @ P350/man-day
Weeding: Mowing – 12 man-days @ P350/man-day; Ringweeding – 30 man days @ P350/man-day
Pruning: 4 man-days @ P350/man-day
Irrigation: 12 man-days @ P350/man-day
Pest control: 9 man-days @ P350/man-day

Costs of equipment and tools

Irrigation pump and fittings: P45,000
Brushcutter: P12,500
Sprayer: P3,500
Pruning shear: P350

Organization expenses and working capital

Expenses for a feasibility study: P10,000
Business permit: P5,000
Working capital: P150,000

NOTE THAT:

Operating costs are expenses incurred while running the business venture. Estimate the operating cost of a one-hectare fruit farm based on the following technical coefficients:
Orchard maintenance: 60 man-days @ P350/man-day; starts on the first year of operation; assume a yearly increase of cost by 25% up to the fifth year; 30% increase in the succeeding years
Repair of equipment and facilities: 5% of the value of fixed assets with moving parts (i.e., pump, brush cutter, and sprayer); no repairs in the first two years; 5% increase in the succeeding years
Land rent: P4,500/year; starts on the first year

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