A wide variety of events and actions affect the profitability of a farm, not the least of which is the setup and use of accounting software. Taking advantage of financial tools available for farms can have a big effect on a farm's profitability. Red Wing Software offers tips for farms to become more proactive in their use of accounting software, in order to increase profits.
Track crop information correctly. Tracking financial information by crop, farm, field, and land owner are simply crucial to smart decision making on a farm. By tracking this information, farmers can make more profitable decisions by creating "what if" scenarios within their accounting software.
Using "what if" scenarios can help farmers:
- Compare the profitability of individual production years, regardless of crop/livestock.
- Determine which commodities to continue producing by comparing the profit per acre/head of each crop/livestock.
- Determine if fields/livestock are not producing to their potential.
- View the break-even cost/bushel for each field in a production year.
- View the profitability of a field regardless of which crop it raised over a period of time or determine if it is more profitable to raise feeder hogs or farrow to finish.
- Analyze and compare profitability between profit centers, farms, and production years or other combinations of business segments.
Click here to see more...