The purpose of the cost accounting system is to provide you with information to assist in making management decisions for your farm. This includes information on yields, expenses, income, and profitability. (Other accounting systems use the term “enterprise accounting” for this.)
The crop cost accounting system is updated through the one time entry of information on payroll checks, vendor checks, deposits and pesticide usage. All of this takes place automatically when you enter a cost center and crop year for these transactions. Crop reports can be printed at any time for an up to date status on your bottom line.
Cost Accounting Features
- Cost accounting reports group expenses by crop year, independent of the calendar year or fiscal year. This eliminates any problems with crops whose growing season may span two different fiscal or calendar years.
- Equipment cost centers may be set up alongside your crop cost centers to track costs for operating the equipment, including repairs, parts, supplies, fuel, and so on.
- Memo crop costs allow you to record expenses for crop reports without having to affect general ledger account balances.
- The system can track a different commodity for each crop year, useful for open ground fields.
- Cost accounting information can be exported directly to Excel for use in producing charts or additional reports.
- Payroll overhead (employer taxes and worker’s comp) is expensed precisely to each cost center based on the total labor expensed on payroll entries. An alternative is available to expense a percentage of the total payroll as a memo cost entry instead.
- A single worker’s comp rate may be set up for each cost center. However, different worker’s comp rates may be set up for different jobs on the same cost center if you have lower rates available for certain jobs.
- For farm management companies, expenses in the cost accounting system feed directly into the farm management billing system.
- Consolidated Crop Reports allow you to group cost centers together to print a single report for a ranch, crop, overhead or variety. Cost centers may appear on multiple crop reports. For instance, you might define a crop report that includes all citrus cost centers, another that includes only your oranges, and another that includes only groves growing with Navels.
Cost accounting reports include
- Crop Report (profit or loss by cost center)
- Comparison Crop Report (prior year to current year)
- Comparison Crop Report (current year to budget)
- Monthly Crop Report
- Consolidated Crop Report
- Expense Report