Mr. Daboug, gardener in Navrongo is planning his production for next season, and has asked you as a cost accountant, to recommend the optimal mix of vegetable production for the coming year. He has given you the following data relating to the current year: 

Fixed overhead per annum is GH¢54,000 

The land that is being used for the production of carrots and parsnips can be used for either crop, but not for potatoes and turnips. The land being used for potatoes and turnips can be used for either crop, but not for carrots and parsnips. In order to provide an adequate market service, the gardener must produce each year at least 40 tonnes each of potatoes and turnips and 36 tonnes each of parsnips and carrots.

 (a) You are required to present a statement to show: 

i) The profit for the current year 

ii) The profit for the production mix that you would recommend. 

(b) Assuming that the land could be cultivated in such a way that any of the above crops could be produced and there was no market commitment, you are required to: 

i. Advise the market gardener on which crop he should concentrate his production;

ii. Calculate the profit if he were to do so 

iii. Calculate in Ghana cedis the break-even point of sales i. 111.

Potatoes Turnips Parsnips Carrots Area occupied (acres) Yield per acre (tonnes) Selling price per tonne (GHe) Variable cost per acre (GH): Fertilizers 25 20 30 25 10.00 8.00 12 100 125 150 135 30 25 45 40 Seeds 15 20 30 25 Pesticides 25 15 20 25 Direct wages 400 450 500 570