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Casey Iowa | Do you get to depreciate laser leveling and irrigation wells?
I'm not arguing your $60 machinery cost that sounds in line. Here is a hypothetical for u though just to have some fun with #'s......I wish I get our boys to enjoy #'s this much......they r still plenty young though...4-wheelers r way more fun;)
Buy a new tractor for $170,000
Sell it with 6,400 hours for $110,000
Ten years later
60,000 principal costs
Figure 4% interest on 170,000 is $6,800 a year interest cost......if u have money in the bank getting less than 1% then your interest cost is only $2,000 a year, but I'll just figure 4%.
$6,800 * 10 years is $68,000 + $60,000 principal costs for a total of $128,000/10 years is $12,800 average yearly cost for 640 hours a year of use for a John Deere 9420 with a PTO. Tractor could run anything on the farm from tillage, planting, to author cart. Cost per hour would be $128,000/6,400 hours equals $20 an hour. 4 oil changes a year would run about $800 total, pretty easy to keep them 20 series in good shape. That tractor just ran. I suppose we spent $2,000 tops on other little items on it during that 6400 hours.
The thing is you can buy a really nice low houred...(1,000-1,600 houred) tractor of the same caliber but newer like 2008-2011 from $135,000-190,000 depending on some variables. It will work the exact same as the 9420 scenario. It's not that hard to keep equipment cost in check.
Heck I can hire it done cheaper than some people say the machinery costs are.
Soybeans
No-til Planting----$14
2 pass spray----$12
Harvest-----$34
Haul----$7
$63 an acre machinery, fuel, and manpower.
I'm not arguing your cost 5 Bean, if u say $60 and I know u prolly have some other passes over the fields for different crops, but anybody over $100 an acre for just their machinery expense might as well hire it done and save some money....
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