Cost of Production

Take the uncertainty out of your decisions by calculating your cost of production.
Why calculate your cost of production?

Knowing your cost of production is a powerful management tool. Watch a short video to see how cost of production can help bring confidence and clarity to your management decisions.

How is cost of production different from other records you keep?

View our quick guide of understanding financial records.

Ready to dig into the basics?

Start with the Financial Terms course to begin laying the foundation.

Laying the Foundation: Financial Terms
  • Review key financial terms around costs, breakeven, and cost of production
  • Key differences among financial documents and how to use them
  • Test yourself on financial terms
Cost of Production Basics: How to Calculate
  • Review the difference between cash and accrual accounting
  • Explore the four steps to calculating cost of production
  • Practice calculating cost of production and breakeven
Try it Out: Do the Math
  • Find out which records are relevant for calculating cost of production
  • Sort through and classify records needed for cost of production
  • Walk through a sample calculation and try your hand at doing the math
Try it Out: Make Decisions
  • Analyze an operation to find red flags and opportunities
  • Make recommendations based on cost of production
  • Use cost of production to make decisions about when to sell or whether you can afford a purchase

Cost of Production Related Content

Jan 19, 2024 | The Business of Agriculture

Interest Rate Forecast: What Farmers Can Expect In 2024

Read more what interest rate forecasts and macro-economic indicators mean for producers and their 2024 planning.

Jul 23, 2021 | The Business of Agriculture

Moving Beyond "Know Your Costs of Production"

Learn more about how to factor cash flow, accounting and economic costs into your management decisions.

Dec 12, 2017 | The Business of Agriculture

Knowing Your Cost of Production Can Lead to Sound Management Decisions

We introduce you to “Joe Farmer” to illustrate the power of knowing your production cost.


Your financial officer is a great resource to help you calculate your cost of production. Contact your local office for a consultation.