John Tarleton Angus Beef

John Tarleton Ranch is a small, family-owned business that started its operations in 1899. Recently, the Ranch received a gift of an Angus steer. The goal is to make as much money as possible from this gift. The Ranch is consulting with you to learn about selling the Angus steer.

You are to prepare a revenue and cost analysis (in Table form) for the Angus steer. The known facts are:

The steer was just born and expected to mature in 24 months. At maturity, it is expected that the steer would weigh 1800 pounds. At 20 months old, the steer is expected to weigh 1200 pounds. Up until 20 months old, it is expected that the steer will be nurtured by its mother and eat grass. Since the steer will graze on the football field, the cost of feeding the steer until 20 months old is zero.

From 20 months until 24 month, the steer would be fed a diet of grass and a special grain mixture designed for fattening steers. Each day during these four months, the steer would eat 1.25% of its body weight in grain mixture. Assume a linear grow from 20 months to 24 months. The growth from birth to 20 months of age would be typical for an Angus steer.

Cost of feeding per day is $2.48 per head.

Questions to answer:

1. What is a typical growth pattern (in pounds) for an Angus steer from birth to 20 months old?

2. How much would it typically cost for the grain feed from 20 month to 24 months?

3. Based on age and projected weight, how much could the steer be sold for?

4. When is the best time to sell the Angus steer?Justify your answer.

5. What other items should the Ranch consider?

Be sure to cite your sources.