Capital budgeting for hay storage decisions

Abstract

This article illustrates a capital budgeting tool that Extension agents and specialists can use to assist agriculture producers when contemplating the construction of a hay storage facility. Capital budgeting is a tool for evaluating the effects of an investment choice on a business. The payback method is a quick and simple capital budgeting procedure. Use of this method requires producers to estimate hay price, facility construction cost, and potential hay loss per year assuming no storage. © by Extension Journal, Inc.