Why this matters
Tracking your cost of production per crop or per enterprise is key to understanding breakeven—and making better decisions on selling and marketing your product. Setting up your enterprises by production year helps you isolate what you spent and earned in that season, even if the product was sold later. That means you get both clean tax records and real operational insight.
Instructions to calculate breakeven and cost of production
The first question to ask yourself when you’re setting up your enterprises is: “what do you want to know at the end of the year about your business”? If you want to know your profitability for a crop in a given production year, then it’s useful to create an enterprise to match. If you run a services business where the income and expenses are incurred at the same time, you can create a single enterprise and view it over a date range to understand your profitability.
In some cases, you may want to consider breaking out your enterprises to profit centers and cost centers. This is generally most useful when your profit centers represent different sales channels - like direct to consumer versus live animal sales - but the costs to produce the product are shared across the two enterprises. You can use our internal transfers feature [Link] to allocate costs from cost centers into profit centers at the end of the year, giving you a better picture of enterprise profitability without impacting your books for taxes.
How to Set Up Enterprises for Specific Years
To set up enterprises for specific years:
Go to Settings → Enterprises.
Create a parent enterprise for the crop (e.g., Corn)
Under that, create sub-enterprises for each crop year. (e.g., Corn 2024, Corn 2025). If you are in a services business (like custom work), you likely do not need separate enterprises for each year.
Tag expenses to the correct crop year to track the cost during the production season.
Tag revenue once you sell the product based on the year it was produced. This will give you your profitability for a single production year so you can track progress over time, while still tracking income/expenses correctly for tax purposes
Tip: At the end of the season, archive old crop-year enterprises to declutter your tag list. You’ll still keep historical records.
How to Set Up Enterprises by Separate Cost and Profit Centers
Below is an example where you might consider setting up separate cost and profit centers because costs are shared across multiple enterprises.
Create enterprises for each year—e.g., 2024 Calf Sales and Hay Sales (Profit centers), 2024 Replacement Heifers and Hay Production (Cost Centers). Some of the hay production will be “sold” to the heifer enterprise (as feed), where as the rest will be sold directly as hay sales.
2. If you’re not sure where a cost belongs until year-end, tag to the cost center, then use an internal transfer to shift it to the profit center at the end of the year.
FAQs
What if I sell grain a year after growing it?
What if I sell grain a year after growing it?
That’s exactly what enterprises can help with! Tag it to the crop-year enterprise (e.g., Corn 2024) so the sale gets included in that year’s profitability.
Do I have to set up new enterprises every year?
Do I have to set up new enterprises every year?
Only if you want clean per-year profitability. Some operations prefer rolling enterprises, but annual enterprises give better insight in certain cases (like when sales happen in a different year than the costs were incurred).
Can I move costs between enterprises later?
Can I move costs between enterprises later?
Yes—use the internal transfer tool to shift costs between enterprises once you know your end of year production numbers.