Using Financial Analysis to Evaluate Management Patterns Used to Managing Tomato Farms in Southern Jordan Valley

Mohammad Ali Bdour

Abstract


This research investigated using financial analysis to evaluate management patterns used for managing tomato farms in the southern Ghors of Jordan, which consisted of five regions. A stratified random sample of 73 holders was investigated. Descriptive and quantitative statistical analysis was used in this study through financial analysis for profit and loss accounting. Pearson's correlation coefficient was estimated to show the relationship of net farm income for each management pattern with the total cost, total revenue and farm area. Results revealed that there were three patterns for regulating and managing tomato farms; management pattern of tenure by the same holder, by one of holder's family members and by a holder- paid manager. Moreover, results showed that the highest net profit was for the management pattern of tenure by a certain work manager, with about 370 JD/ dunum, while that for the management pattern of tenure by the same holder or by one of his family members was 188 and 173 JD/ dunum, respectively. Averages of total costs for the three patterns were: 133, 151 and 148 JD/ dunum, respectively. Pearson's correlation coefficient showed a significant correlation at 0.01 probability, meaning that as the farm area increases, the cost per unit area decreases. This agrees with the general economic trend, reflecting superiority of this pattern over the other two patterns in increasing net farm income and reducing total farm costs. This study recommends improving administrative and technical abilities of farmers in the study area by extension programs specialized in training on agricultural management practices and arguing farmers to use techniques of protected agriculture for increasing crop yield per unit.

Keywords


Management patterns, Tomato, Profit and loss accounting, Pearson's correlation coefficient, Financial analysis

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