Photo AI
The budget below shows the estimated financial aspects for an animal production enterprise for the 2016/2017 financial year - NSC Agricultural Management Practices - Question 3 - 2017 - Paper 1
Question 3
The budget below shows the estimated financial aspects for an animal production enterprise for the 2016/2017 financial year. | ITEM | AMOUNT (R) ... show full transcript
Worked Solution & Example Answer:The budget below shows the estimated financial aspects for an animal production enterprise for the 2016/2017 financial year - NSC Agricultural Management Practices - Question 3 - 2017 - Paper 1
Step 1
Step 2
3.1.2 Identify THREE possible markets in the data above that this farmer is targeting.
Answer
Three possible markets identified in the data are:
- Livestock Auctioning – Selling livestock at local or regional auctions.
- Farm Gate Marketing – Direct sales from the farm to consumers or businesses.
- Manure Retailers – Selling manure to retailers or individuals for agricultural purposes.
Step 3
3.1.3 Calculate the possible profit/loss that this farmer could generate. Show ALL calculations.
Answer
To calculate the possible profit or loss, we use the formula:
Using the values from the budget:
- Total Income = R477 500.00
- Total Expenditure = R113 564.00
Thus,
Therefore, the possible profit is R363 936.00.
Step 4
3.1.4 State TWO possible ways to increase the income of the enterprise.
Answer
Two possible ways to increase the income are:
- Finding More Markets – Exploring additional sales avenues, such as online sales or consignment sales at local markets.
- Adding Value to the Product – Developing new products or improving existing ones to sell at a higher price, such as processed meat or organic products.
Step 5
3.1.5 Identify the section of a business plan that is addressed in this scenario above.
Answer
The section of a business plan that is addressed in this scenario is Financial Aspects/Budget. This section details the expected revenues and costs necessary for planning the financial viability of the business.