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Agricultural machinery costs calculation 1 - english

Website: Plattform für Weiterbildung und Internationalisierung der Hochschule Weihenstephan-Triesdorf
Kurs: International Network in Agricultural Management and Rural Development
Buch: Agricultural machinery costs calculation 1 - english
Gedruckt von: Gast
Datum: Donnerstag, 7. Mai 2026, 15:55

Inhaltsverzeichnis

1. Chapter

Chapter 1:  Introduction costs

 

1.1:  Introduction: economics

 1.2:  Farmers Boris and Alexander have a problem!

 

What is the problem the farmers Boris and Alexander are facing?
a. they want to sell their old tractor
b. they intend to buy a new tractor
c. they want to know if it is worth buying a new tractor
d. they want to decide whether to buy or rent a new tractor

 

What should Boris and Alexander pay attention to, when purchasing a tractor?
a. all arising fixed- and variable costs
b. the overhead and specific costs
c. the opportunity costs
d. the procedural costs and comparative costs
e. the rim color of the tractor

 1.3:  Why Economics?  Why do we need the discipline of "economics"?

 

This course will help you to ....
  1. make business decisions the right way
  2. be able to substantiate business decisions

The subject area of economics deals with the question as to how the numerous existing needs of people (for goods and services) can be satisfied in the best possible way, with an optimal use of limited resources.

Economics is thus a science in which people and their needs are in the focus. Therefore, it is also one of the social sciences. In this course, we would like to address the economics of agricultural enterprises and business management questions like: How can existing and available resources be utilized, so the people who own the business can satisfy as many of their needs as possible?

 

2. Chapter

Chapter 2_EN:  Introduction to the course

2.1: What are costs?

 

Materials

What are costs?

  1. Production factors that are used or consumed in the process of producing output
  2. Services that are used or consumed in the process of producing output
  3. Salaries and wages
  4. Interest expenses
  5. Taxes and insurance

 
2.2: Act of purchase

Are there costs incurred when ....
  1. we buy a tractor?
  2. we buy a tractor for the on-farm production?
  3. if we use a tractor for use for services to other businesses?
  4. when we buy a tractor for 100.000 € and sell it for 90,000 €?

 

2.3:    Fixed and variable costs, change in costs during expansion or restriction of production

2.3.1: Fixed and variable costs

 

 Quiz not available

 

2.3.2: Change in costs during expansion or restriction of production

 

Materials  

Fixed costs are:

  1. Accommodation costs
  2. Administrative work
  3. Sorting costs
  4. Tax consultants
  5. Harvesting operations

2.4: Overhead costs and special costs

 

 

Which costs are special costs?
  1. Pesticides
  2. Diesel
  3. Company car
  4. Feed
  5. Drying costs potatoes
  6. Accounting
  7. Hail insurance
  8. Fertilizers

Which costs are overhead costs?
  1. Computer Operations Manager
  2. Tax Consultant
  3. Business Insurance
  4. Vaccinations
  5. own planting stock produced
  6. Harvesting operations
  7. Administrative work

2.5: Depreciation

 

Materials

What is the role of depreciation for durable assets?
  1. Documentation of the asset history
  2. The depreciation is directly deducted from the taxes
  3. The cost is spread over the operating life
The residual value.....
  1. is always zero
  2. can be zero or positive
  3. is negative, when the machine needs to be repaired
Which utilization limits restrict the use of durable assets?
  1. Stylish obsolescence, there are newer models and colors
  2. technical or physical obsolescence
  3. Wear of the machine by use
To calculate the depreciation threshold, we need the following information:
  1. Performance reserve in hours or ha
  2. Residual value
  3. Performance reserve in years
With the depreciation amount we can buy a new machine by the end of the utilization period:
  1. yes - in any case
  2. no, the sum is not enough if there are high price increases
  3. no - if there is still a residual value, it must be used for the replacement

2.6: Financing costs

 

Whether own funds (equity-financing) or borrowed funds are used (debt, for example, by a bank loan), financing always incurs costs!

2.6.1: Financing costs without residual value

 

Materials

For a car with a cost of 40,000 € and a residual value of zero (0), the average interest claim per year based on an interest rate of 4% is:

a. 3200 €/yr
b. 1600 €/yr
c. 800 €/yr
d. 400 €/yr

 

2.6.2: Financing costs with residual value

 

Materials

For a car with a cost of 40,000 € and a residual value of 10,000 € per year, the average interest claim at an interest rate of 4%, amounts to:

a. 1,600 €/yr
b. 1000 €/yr
c. 800 €/yr
d. 600 €/yr 

2.7: Insurance, motor vehicle tax, TÜ costs

 

Materials

 Which of the following costs for the tractor are "fixed costs":

  1. Insurance costs
  2. Fuels and lubricants
  3. Repair Costs
  4. Cost for technical inspection

2.8: Accommodation costs

 

Materials

Calculate the annual accommodation costs for a tractor with 5.0 m length and 2.3 m width in a lightweight construction garage with a gross area of 800 m² (20 m × 40 m, manufacturing cost of the garage 120,000 €)
a. 304 €
b. 254 €
c. 214 €
d. 194 €

2.9: Variable machinery costs

 

Why are diesel, oil and lubricants variable costs?
a. they change with the output
b. they depend on the actual production volume
c. they are dependent on the intensity
 

2.10: Repair costs

 

Materials

Please complete:
The average repair costs per hour ............ .. with increasing utilization of the machine!

a.  remain the same
b.  are falling
c.  are increasing

 

2.11: Exkursus:

Fixed assets and current assets

 

 

 

 

 

 

3. Chapter

Chapter 3_EN: Summary of machinery costs ( average-, marginal-,  total costs)

3.1: Total costs, average costs

Materials

Which statement is correct?

a. The total costs of a machine per year are increasing with increasing workload, while the average costs per hour under increasing workload are remaining constant.
b.  The workload of the machine has no effect on the total cost per year, but the average costs per hour are decreasing.
c.  The total costs of a machine per year are increasing with increasing workload, while the average costs per hour are decreasing with increasing load.
d.  The total costs of a machine per year are remaining constant with increasing workload, while the average costs per hour are decreasing with increasing workload.

 3.2.1:  Minimum Extent of Utilization (MEU)

 
Materials

At what workload are the total costs of owning machinery just as high as the costs of external mechanization?

a. A
b. B
c. C

 

 3.2.2:  Minimum Extent of Utilization (MEU) Formula

 
Materials

Which formula for the minimum extent of utilization is correct?3.2.1-Q-en.jpg

a.  A
b.  B
c.  C

 3.3.1:  To buy or to rent?
            (A question of comparative cost and utilization)

 

 3.3.2:  To buy or to rent, comparative costs - MEU practice

 
Materials  

With increasing workload (that is, at a higher extent of use for tractor per year) .. ....

a. the fixed costs per year are increasing
b. the total cost per year are decreasig
c. the fixed costs per hour are increasing
d. the average costs per hour are decreasing

 

 

4. Chapter

Chapter 4: Procedural costs – Opportunity costs

4.1:  Procedural costs – Opportunity costs

 

Comparative costs are:
  1. Procedural costs + increases/ reductions due to subsequent costs
  2. Yield losses due to suboptimal processing are costs
  3. Comparative costs always occur due to yield losses
  4. Labor costs + machinery costs


 4.2.1:   Procedural costs "Precision Mulch Seed Drill" (PMSD)
               basic data for the machinery cost (part 1a)

 
  

This course will help you to ....
  1. make business decisions the right way
  2. be able to substantiate business decisions

 

 4.2.2:  Procedural costs PMSD - Part 1b-  solution

 
 

The area of usage for the precision mulch seed drill per year in this example is ........

a. 207 ha
b. 200 ha
c. 167 ha
d. 187 ha


 4.2.3:  Procedural costs PMSD - Part 2a-  solution

 

Calculate the machinery costs of the precision mulch seed drill per hectare per year.
The machinery costs per hectare and year are ..............
a.  105.76 EUR / ha

b.  7 5.76 EUR / ha
c.    95.76 EUR / ha
d.   52.76 EUR / ha

 
4.2.4:  Procedural costs PMSD - Part 2b-  solution

 
 

For the calculation of procedural costs, we need the following data
(Please select)
  1. Labor requirements during sowing
  2. Variable machinery costs for the tractor per hectare and hour
  3. Wage claim per hectare and hour
  4. Total costs of the seed drill per hectare

 

 4.3.1:    Procedural costs mulcher, Example 1a

 
 

Based on the data given in the instructional video please calculate the machinery costs for the mulcher per year

A.  2310 EUR / year
B.  2210 EUR / year
C.  2110 EUR / year
D. 2010 EUR / year

 

 4.3.2:  Procedural costs mulcher, Example 1b - solution

 
 

The area of usage for the mulcher in this example, each year is ........

A.   60 ha
B.  270 ha
C.  180 ha
D.   90 ha

 
4.3.3:  Procedural costs mulcher, Example 2a

 
  

Based on the data shown in the example, calculate the costs for mulching per hectare and year

A.   84.70 EUR / ha
B.  114.70 EUR / ha
C.   24.55 EUR / ha
D.   54.70 EUR / ha

 4.3.4:  Procedural costs mulcher, Example 2b- solution

 
 

The wage claim per year for mulching in this example is ........

A.    545 EUR / year
B.  1145 EUR / year
C.    945 EUR / year
D.    745 EUR / year

 

 4.4:  Discussion of the results

 
 

The procedural costs depend on .......
  1. the extent of use
  2. Wages of temporary external laborers
  3. the field-to-farm distance
  4. labor costs
  5. the working width of the drill
  6. Wages / costs of permanent external workers
  7. the opportunity costs for permanent family workers (Akh)
  8. the wage claim
  9. the machinery costs

 

 

5. Chapter

Chapter 5: Comparative costs and Minimum Extent of Utilization (MEU)


5.1:   Comparative costs

 


 5.2:    Minimum Extent of Utilization (MEU), Formula

 
   

Please choose the correct answers from:
  1. Increases/ reductions are generally related to the variable costs
  2. When comparing internal and external mechanization, there are always increases/ reductions incurred.
  3. Increases/ reductions are as additional costs exclusively ascribed under the accounts for contract work
  4. Increases/ reductions are always related to the fixed costs

 

 

 

6. Examples

Chapter 6:     Sample calculations


6.1:   Sample calculations: Exercise for Combine Harvester

Calculation exercise "Combine harvester":  

Part 1: Machinery costs

Part 2: Procedural costs

Part 3: Comparative costs and minimum extent of utilization at equal quality of work.

Part 4: Comparative costs and minimum extent of utilization at different quality of work.


 6.1.1:    Part 1a: Machinery costs,1a -task

 
Materials  

The average costs per ha at an average use of 600 ha per year amount to....

A.  153,45 € per hectare
B.    84,33 € per hectare
C.  109,43 € per hectare
D.   72,56 € per hectare

 

 6.1.2:    Part 1b: Machinery costs,1b -solution

 
   Materials

 

 6.1.3:    Part 2a: Procedural costs, 2a -task

 
Materials  

The entire procedural costs (machinery costs + labor costs) per hectare are on average:

A.  123,43 € per hectare
B.  130,32 € per hectare
C.  112,68 € per hectare
D. 117,83 € per hectare

 

 6.1.4:    Part 2b: Processing costs, 2b -solution

 
   Materials

 

 6.1.5:    Part 3a: Comparison costs and Minimum Extent of Usage, 3a -task

 
Materials  

The minimum extent of utilization in hectares per year for the owned harvester

A.  600 ha per year
B.  543 ha per year
C.  400 ha per year
D.  489 ha per year

 

 6.1.6:  Part 3b: Comparison of costs and minimum extent of utilization, 3b -solution

 
   Materials

 

 6.1.7:    Part 4a:
Comparative costs and minimum extent of utilization, taking into account differences in the quality of work - Exercise 1, 4a -task

 
Materials

The minimum extent of utilization in hectares per year for the owned harvester under consideration of timeliness costs is:

A.  418,8 ha per year
B.  600 ha per year
C.  350 ha per year
D.  400 ha per year

 

 6.1.8:    Part 4b: MEU with differences in the quality of work, 4b -solution 1 and task 2

 
Materials

The minimum extent of utilization in hectares per year for the owned harvesters, under consideration of higher yield losses due to internal mechanization

A.  592,5 ha per year
B.  600 ha per year
C.  489 ha per year
D.  543 ha per year

 

 6.1.9:    Part 4c: MEU with differences in the quality of work, 4c -solution

 
 Material

The correct answer is: The minimum extent of utilization for an owned harvester, taking into account the higher losses on the side of internal mechanization, is 592.5 ha per year. Accounting for both effects simultaneously, the minimum workload is only at 447.6 ha per year.

 

7. Summary

 

 

 

 

 

8. Skripts

Chapter 7:    Script | Glossary | Calculator of operational costs of agricultural machinery

 

7.1:   Script


 7.2:    Glossary

 

 

 

 7.3:    Calculator of operational costs of agricultural machinery

  

 

 

9. Content


 

MOOC 1_EN: The agricultural machinery costs calculation

 

Content:

Topic 1   Introduction to the course and the topics
  1.1 Economics
  1.2 Farmers Boris and Alexander have a problem!
  1.3 Why Economics?
Topic 2   Introductin costs and explanation of fixed and variable costs
  2.1 What are costs?
  2.2 Act of purchase
  2.3.1 Fixed and variable costs
  2.3.2 Change in costs during expansion or restriction of production
  2.4 Overhead costs and special costs
  2.5 Depreciation
  2.6 Financing costs
  2.6.1 Financing costs without residual value
  2.6.2 Financing costs with residual value
  2.7 Insurance, motor vehicle tax, TÜ costs
  2.8 Accommodation costs
  2.9 Variable machinery costs
  2.10 Repair costs
  2.11 Exkursus: Fixed assets and current assets
Topic 3   Summary of machinery costs ( average-, marginal-,  total costs)
  3.1 Total costs, average costs
  3.2.1 Minimum Extent of Utilization (MEU)
  3.2.2 Minimum Extent of Utilization (MEU) Formula
  3.3.1 To buy or to rent?
  3.3.2 To buy or to rent, comparative costs - MEU practice
Topic 4   Procedural costs – Opportunity costs
  4.1.1 Procedural costs – Opportunity costs, Part 1
  4.1.2  Procedural costs – Opportunity costs, Part 2
  4.2.1  Procedural costs "Precision Mulch Seed Drill" (PMSD) basic data for the machinery cost
  4.2.2  Procedural costs PMSD - Part 1
  4.2.3  Procedural costs PMSD, Example Part 2a
  4.2.4  Procedural costs PMSD - Part 2b- solution
  4.3.1  Procedural costs mulcher, Example 1a
  4.3.2  Procedural costs mulcher, Example 1b
  4.3.3  Procedural costs mulcher, Example 2a
  4.3.4  Procedural costs mulcher, Example 2b
  4.4  Discussion of the results
Topic 5   Comparative costs and Minimum Extent of Utilization (MEU)
  5.1  Comparative costs
  5.2  Minimum Extent of Utilization (MEU), Formula
Topic 6   Exercises
  6.1  Exercise Combine Harvester
  6.1.1  Part 1a: machinery costs,Tasks
  6.1.2  Part 1b: machinery costs, Solution
  6.1.3  Part 2a: Procedural costs, Tasks
  6.1.4  Part 2b: Processing costs - Solution,
  6.1.5  Part 3a: Comparison costs and Minimum Extent of Usage, Tasks
  6.1.6  Part 3b: Comparison of costs and minimum extent of utilization - Solution
  6.1.7  Part 4a: Comparative costs and minimum extent of utilization, taking into account differences in the quality of work - Exercise 1, Tasks
  6.1.8  Part 4b: MEU with differences in the quality of work - Solution 1 and task 2
  6.1.9  Part 4c: MEU with differences in the quality of work - Solution 2
  6.2.1  Exercise "Square baler",
Part 1a:  Machinery costs, Tasks
  6.2.2  Part 1a:  Machinery costs, Solution
  6.2.3  Part 2a: Procedural costs, Tasks
  6.2.4  Part 2a: Procedural costs, Solution
  6.2.5  Part 3a: Comparative costs and minimum extent of utilization at equal quality of work
  6.2.6  Part 3b: Costs of own machinery
Topic 7   Summary
Exam    Final Exam
    Curs End