FINANCIAL ANALYSIS AND FARMING FEASIBILITY OF SALAK PONDOH IN TIGA JUHAR VILLAGE, STM HULU SUBDISTRICT, DELI SERDANG DISTRICT

Muhammad Wasito, Ismail Dahlan and Aulia Harahap Science and Technology Departement, Pembangunan Pancabudi University, North Sumatera, Indonesia. ...................................................................................................................... Manuscript Info Abstract ......................... ........................................................................ Manuscript History Received: 01 December 2019 Final Accepted: 03 January 2020 Published: February 2020

The purpose of this research is to determine the Income and profits of Salak Pondoh farming and the feasibility in Tiga Juhar Village, STM Hulu District, and Deli Serdang Regency. This research conducted in Tiga Juhar Village, STM Hulu Subdistrict, which was deliberately chosen as the location of the study because it was the center of the production of Salak Pondoh in Deli Serdang. The number of respondents was 60 farmers who were taken randomly by a simple random sampling system. The research method used in this research is a survey method; the data collection was carried out in April 2018. The Sampling of this research was to answer the quantitatively by using financial analysis Net B / C NPV, IRR, PBP, and sensitivity analysis using a 9% discount factor. The Results showed that Salak Pondoh farming in Tiga Juhar Village, STM Hulu subdistrict was financially feasible and profitable to continue. This refers to the value of the Net B / C = 3.5, value of NPV = 116,953,200. The value of IRR = 20.6% and PBP = 4 years 8 months. Salak Pondoh farming is sensitive to decreasing production and decreasing production prices, but not sensitive to rising fertilizer prices.
There are several earlier studies regarding financial analysis, sensitivity analysis, and strategy development related to commodities as research objects. Some past research results related to this research are as follows: Handayani, Thomson, and Salmiah (2018) NPV of Salak farming with a term of ten years farming in the discount factor of 4.25 % to Rp. 761 221 931. That is a discount factor of 4.25 %; Salak Farming at the end of the ten-year term gain of Rp 761 221 931. Furthermore, to a factor of 5%, it will benefit next year is Rp 717 812 690. Based on the criteria of net B / C Salak Pondoh farming viable, because the value of the net B / C obtained at 9.39. The net value of B / C of 9.39, meaning every Rp. 1.00 expenses incurred will get an additional benefit of Rp. 9.39. Salak Farming has an IRR of 15.48%. The meaning of IRR is more significant than a specified discount factor of 4.5% so that Salak Farming feasible to be developed, and the value of IRR obtained at 15

Sampling methods:
The total population of Salak farmers in Tiga Juhar are 280 people. The method of determining the sample size for this study is to establish specific criteria which are; a) Have a minimum land area of 0.2 hectares. b) The area has been farming for at least five years.
From 280 farmers found 112 farmers who meet the criteria. Furthermore, by using a random sampling of 112 farmers selected some of them to be sampled by the Slovin formula: n = N/ (1+Ne^2) with an error rate of 10% obtained: n = 112/ (1+112.0,01) n = 53.3 rounded up to 60 samples

Assumption:
The assumptions used in this study are; a. Input and output prices are the prices at the time of the survey. b. The production of Salak sold out. c. The interest rate used is the KUR BRI 9% (BRI Bank).

Data collection technique:
This study was conducted using a survey method, and the research took a sample of a population. Data collected in the study consisted of primary data and secondary data. Primary data were collected by interviewing directly to Salak farmers by using a list of questions (questionnaire), which prepared beforehand. Secondary data obtained from the published literature and other agencies involved in this study (Zulfikardy, 2014).

Data analysis methods:
Data analysis methods used in the study are a quantitative analysis that is used to answer all the goals in this study. The data processing method and computerized tabulation method (Microsoft Excel).

Data Analysis Techniques:
A data analysis technique used to test the feasibility of salak farming of the financial aspects of using a measuring instrument or investment following criteria, namely NPV, Net B / C, IRR, and PP (Kadariah, 2001).

Net Present Value (NPV):
The difference between the current value and the present value expenditure reception at a certain discount rate. The formula used is: bt = Benefit in t Ct = Cost in year t n = Economic life of the plant (10 years) i = Discount rate of 9% t = Year 1, 2, onward. Here are financial feasibility assessment criteria based on NPV (Net Present Value). 1) NPV> 0, meaning that the project is financially feasible because the benefits outweigh the costs incurred. 2) NPV <0, meaning that the project is not financially feasible for smaller benefits than costs. (Sinaga, 2008). b). Net Benefit-Cost Ratio (Net B / C) Is a comparison of the present value of net positive benefits to the present value of net benefits, which negatively expressed by the following formula: bt = Benefits in year t Ct = Costs incurred in year t n = Economic life of the plant i = Discount rate 9 (percent) t = Year to 1, 2 ff. The project is said to be feasible if the values obtained Net B / C is higher than 1 (one) and not worth it if the earned amount of Net B / C is smaller than 1 (one). If Net B / C is equal to one, the decision submitted to the management (Sinaga, 2008). c). Internal Rate of Return (IRR). The discount rate (discount rate) at the time of the NPV equal to zero expressed as a percentage, which is represented by the formula; = Compound factor, if NPV <0 If a project IRR greater than or equal to the prevailing interest rate, the project is feasible, but if the IRR of a smaller project than the prevailing interest rate, the project is not feasible. (Sinaga, 2008).

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The assessment criteria Payback Period: 1) If the payback period is shorter than the economic life of salak farming crops, then declared eligible. 2) If the payback period is more extended than the economic growth of salak plant, then farming declared unfit. (Sinaga, 2008).

Sensitivity Analysis:
The sensitivity analysis is an activity to analyze back in an attempt to see if that would happen to the business if the business did not go as plan. In agriculture, some things are sensitive to changes. Changes that occur include increased investment, changes in the cost of production, and commodity price changes.

Receipts and Revenue Farming:
Reception Salak Pondoh farming calculated by multiplying the number of productions at a price per kilogram. While income calculated by subtracting the number of admissions for a total cost during the production process. Salak Pondoh begins the production at the end of the third year so that revenue and income are calculated starting from the 3rd year of farming business. Showed in the table 1 below,

Feasibility of Salak Pondoh farming:
Salak Pondoh is an annual plant that has industrial age and a long harvest period. By knowing the revenue and income from farming is certainly not sufficient to determine whether the business is worth it or not to be pursued. Therefore, revenue analysis is required to assess the feasibility of farming Salak Pondoh. Here some of the approaches used in the study of the financial viability of farming Salak Pondoh are; NPV, Net B / C, IRR, and Payback Period.

Net Present Value (NPV)
To determine the NPV of Salak Pondah farming expand the area of 0.47 ha showed in Table 2 below.

Net Benefit-Cost Ratio.
Net B / C obtained by finding the ratio of the present value of which is positive with several present values is negative. Showed in the table 3 below,  Table 3, Net B / C made at 3.5, which indicates that farming Salak Pondoh indeed very worthy of being pursued.

Internal Rate of Return (IRR):
IRR describes the rate of return results that linked to bank interest rates, showed in the table 4 below,  Table 4, it showed that the IRR of farming Salak Pondoh amounted to 20.6%. With the value of IRR is that the farm Salak Pondoh declared eligible for higher than the benchmark interest rate stipulated 9%.

Payback Period (PBP)
The Payback Period is used to determine how long it takes or how long the project could recoup the investment. Showed in the table 5 below,

Analysis sensitivity:
The sensitivity analysis aims to see what happens with the results analysis, investment in case of changes in the calculation of costs and revenues. In the sensitivity analysis, there is a miraculous aspect analyzed with the loss, falling prices, and rising costs. Showed in the table 6 below,  In terms of feasibility indicates that farming is still viable in the conditions of production fell by 30%. The occurrence of a significant reduction, when compared to normal conditions, shows that farming Salak Pondoh sensitive to the decline in output of 30%. Showed in the table 8 below, In terms of feasibility indicates that farming is still viable on the condition, the price fell 30%. The occurrence of a significant reduction, when compared to normal conditions, Salak Pondoh farming sensitive to the decline in production of a 30% price.