Acronyms
NFIFO
Net Farm Income From Operations
Asset turnover Ratio
gross revenue / average total assets
Liquidity
the ability of a business to generate enough cash to pay bills without disrupting business hours
The ending inventory for one year is ____________________
The beginning inventory of the next year.
What is the Debt to assets ratio
total assets- $3,095,084
Total liabilities- $832,965
.27 : 1
NFI
Net Farm Income
Operating Expense Ratio
total operating expense - depreciation / total revenue
Liabilities
anything owed by the business
On what date do most farms and ranches complete their inventories?
January 1
Equity to Assets
Net Worth- $1,458,283
Total Assets- $1,989,543
.73 : 1
ROA
Return to Assets
Net Farm Income from Operations ratio
NFIFO / Total revenue
Asset
anything owned by the business
What are the functions of the farm and ranch manager
Planning, Implementing, and Evaluation
Current Ratio
Current Assets- $307,231
Current Liabilities- $134,550
2.28 : 1
ROE
Return to Equity
Debt to Equity Ratio
Total farm Liabilities / Total Farm equity
Net worth Statement
A statement that says what is owed/owned at one time
Describe Trend and Comparative Analysis
Trend- compare ratios over a period of time on the same farm
Comparative- compare the farm ratios to other similar operations
Debt Structure
Current Liabilities- $130,260
Total Liabilities- $531,260
.25 : 1
COD
Cost of Debt
Total Liabilities / total assets
Accounting period
most use the calendar year to summarize revenue and expense
What are the 4 Solvency Measures
Net Capital Ratio
Debt to asset ratio
equity to asset ratio
Debt to equity ratio
Working Capital
Current Assets- $ 296,563
Current Liabilities- $130,260
$166,303
OPMR
Operating Profit Margin Ratio
Equity to assets Ratio
Total farm equity / total farm assets
Operating expense
4 Steps of record keeping
1. Select a record-keeping system
2. Select and accounting system
3. Select a method reporting farm income/Expenses.
4. Develop a procedure to get the data needed
Debt to Equity
Total Liabilities-$557,650
Total Farm Equity- $1,444,553
.39 : 1
EBITDA
Current Ratio
Current assets / current liabilities
Financial Record & Physical Records
Receipts, expenses, assets, and liabilities to allow financial statements
Shows production of crops/ livestock and usage of inputs
What are current assets/ non-current assets
Current- assets used or sold during upcoming accounting period
Non-current- assets not easily converted to cash/ not expected to during the next accounting period
Net Farm Income from Operations Ratio
Total Revenue- $648,133
Total Expenses- $562,758
.13 : 1