You are opening a new winery. For your business plan, your banker and investors have asked for information on branding and costing of your product. Your plan is to produce 500 cases a year of sparkling wine, because you have just acquired a new vineyard producing cool-climate Pinot Noir. To prepare for the meeting, prepare the answer to the following questions. 1. Your vineyard cost $800,000 CDN and is planted to 8 acres of Pinot Noir capable of producing a baseline average of 2.2 tonnes of fruit per acre. You have a mortgage of $800,000 (wow, your bankers really trust you!) at 3% APR on a 30-year term beginning January 1, 2021. You can rent a custom crush facility (cellar, press, tanks, and a co-op tasting room) for $7500 a year, and at this time you don’t have the money to consider purchasing your own facility and equipment ($1M). What are your monthly fixed costs for vineyard and facilities? 2. Your vineyard has drip irrigation, and you will need to decide whether to use it or not. If you use it, you will need to assume $2000 a year in irrigation maintenance and repairs and $2500 a year in water costs using RDI (reduced deficit irrigation; lecture 1). What will your monthly irrigation costs be if you irrigate your vineyard
You are opening a new winery. For your business plan, your banker and investors have asked for information on branding and costing of your product. Your plan is to produce 500 cases a year of sparkling wine, because you have just acquired a new vineyard producing cool-climate Pinot Noir. To prepare for the meeting, prepare the answer to the following questions.
1. Your vineyard cost $800,000 CDN and is planted to 8 acres of Pinot Noir capable of producing a baseline average of 2.2 tonnes of fruit per acre. You have a mortgage of $800,000 (wow, your bankers really trust you!) at 3% APR on a 30-year term beginning January 1, 2021. You can rent a custom crush facility (cellar, press, tanks, and a co-op tasting room) for $7500 a year, and at this time you don’t have the money to consider purchasing your own facility and equipment ($1M). What are your monthly fixed costs for vineyard and facilities?
2. Your vineyard has drip irrigation, and you will need to decide whether to use it or not. If you use it, you will need to assume $2000 a year in irrigation maintenance and repairs and $2500 a year in water costs using RDI (reduced deficit irrigation; lecture 1). What will your monthly irrigation costs be if you irrigate your vineyard?
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