Farm Financial Standards Council

The John and Mary farmer is a big time producer of corn and soybeans With 1060 acre , the crop farm is located in the mid-west Corn Belt Technically , John and Mary only managed the 340 acre out of their 1060 corn and soybean farm . The 480 acre is rented through 50 /50 crop share while the 320 acre is rented through cash by five different owners . In a sense , the unique characteristic or feature of John and Mary 's farm is that theirs has one common machinery line used in farm operations between

the farm John and Mary and their son who operates his own farm independently . John and Mary 's son holds the and soybeans farm , and shares his major farm tractor with his parents

Moreover , the couple manages and operates their farm as a sole-proprietor , which agriculture farming has been a part of their family legacy . Although the couple has been well hands-on in managing and running their farm , john is the one who is more active to take care of the daily operations of their farm and have been the major decision maker , while Mary has a brilliant career outside of their farm . However John is getting old and is nearing to reach his retirement age in about five to seven years . With this , John wants to leave the farm office with a great management and operation system to ensure the future of the farm even after his retirement . Essentially , John wanted to set up a managerial accounting system for future management purposes

The first proposed solution for this case , on the other hand , is useful to the John and Mary farmer as well as with other agricultural enterprise seeking to set up management accounting techniques . With the proposed solution , the farm owner will be able to determine significant centers of the farm - support cost center , production cost center profit center and cost center . Essentially , this proposed solution will help the owner and gather a comprehensive data report , which are all useful information for the management

In deeper review of the proposed solution , this will give a clear data of the shop , equipment , maintenance and the entire farm . Will provide a thorough report of the production stages and will determine the product profit for every year . In addition to this , the proposed solution will be essential to establish reliable sales , financing , administration and financing aspects . In a sense , all of these are the positive benefits that the proposed solution can provide for John and Mary 's farm as well as to other agricultural enterprise who seeks to set up a reliable management accounting techniques . Nevertheless , this proposed solution can be the reliable managerial accounting system that John wanted to set up for their farm after his retirement to ensure its future and monitor the financial performance of their farm

However , the proposed solution is a bit complicated , which carry a complex schematic relationship between each center . One possible drawback of this proposed solution is that execution may...