dairy farm financial

8/9/2019 Dairy Farm Financial

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Enter Numbers i Dark Blue on the following page, all others are calculated.

This program uses only business assets and liabilities in the reconciliation

Howeer! non-business cash in"ows and out"ows are considered #or corre

Introduction: The primary purpose of this template is to demonstrate the interactiofeasibility of an operation. The user must complete some very simple information aassests and liabilities are necessary to provide a complete financial picture.

Use the Enterprise tab and Statements tab at the bottom of the screen to enter requesSpreadsheets that are capable of detailed financial analysis are located at http:ww

#inancial statements used are very condensed versions of the basic statements usedstatement of owner equity&. These statements are both simplfied and some data entrstatement. 'hile simplified statesments% the interaction of the statements and financfinancial analysis ratio values $see )atio*+alc tab& and dollar amount calcualtions id

The statements in this template are distributed "in balance" $fully reconciled&. To heinformation flows from one to another% chane a number $only those in blue te!t& inEquity indicates whether the statements are still reconciled. This provides an opportone number must be "offset" with chanes somewhere else in the same system of finautomatically computed and put on the riht statement. (f the Statement of ,wner Estatements" are out of balance. The user must make one or more additional entries s


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Written by Duane Grit

Montana State ni!ersit

"#$ %in&eld 'all

(o)eman, M* +-#-

$/00"+1$

*o chec2 for updates of thi

%oof for the 3D4inancial

date this &le was last up

process. Personal (Non-Business Assets and Liabilities) items are ignored.

ct $ash %low calculations. (&' %arm wages! #amily liing ependitures! etc.)

grith5montana.edu

http677www.montana.edu

of financial statements and take a "quicka and dirty" look at the financialout each enterprise within an operation. Additional information about

ed data. This template is not capable of detailed financial analysis. w.montana.edue!tensioneconfarmmtsoftware.html

or financial analysis $balance sheet% cash flow% income statement%has been restricted to assure information flows to the correct financial

ial analysis concepts remain the same. (n fact% these statements produceentical to detailed financial statements.

p learn about the relationship amon the financial statements and howne of the statements or on the Enterprise tab. The Statement of ,wnernity to discuss how financial statements are linked toether. +hanes in

ancial statements. (n many instances% in this spreadsheet% this offset inquity showns a -iscrepancy fiure that is not equal to ero the "set ofmewhere to make the statements reconcile.

mailto:[email protected]://www.montana.edu/extensionecon/farmmgt/software.htmlhttp://www.montana.edu/extensionecon/farmmgt/software.htmlmailto:[email protected]


3/47

%ast update

Septemeber ##, "$$9

software, clic2 the lin2 below.

&le and chec2 the

dated.

7e8tensionecon7farmmgt7software.html

http://www.montana.edu/extensionecon/farmmgt/software.htmlhttp://www.montana.edu/extensionecon/farmmgt/software.html


4/47

+lick button to print all input% statements% and ratios in this file//

Crop Production/Sales Estimates:Crop and Forage Enterprises (MUST use a yield of for summ

+rop#orae 0ame 'inter'heat 1arley 2ay Sum. #allow )ecrop 1ar. )

3ield 4er Unit 56.6 78.6 9.66 75.9

0umber of Acres 4er Enterprise 666 >.6@ 6.6@ 6.6@ 6.6@ 6.6@

Total Enterprise +rop )evenue =%666 =66 =6 =6 =8%

?ease 4ayments oin To ,thers =>%;59 =6 =6 =6 =6

Units $1u% tons% lbs& 4roduced 56%666 97%666 >66 %666 8%>76

Total &!ner/Tenant 'eenue 'eceied )*+,"-+

iestoc0 Produciton/Sales Estimates:Breeding Livestock Enterprises 1on23reedin4 iestoc0 Ent.

+owB+alf Sheep ,ther brd lvstk #eeders Stockers

+ull )ate for Enterprise


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E8penses by Enterprise

Crop and 9ora4e Enterprises

'inter'heat 1arley 2ay Sum. #allow )ecrop 1ar. )ecrop

Help Av. +ost 4er Unit of 3ield =9.66 =.8< =76.66 =5 =;%6

Total +rop +ost of 4roduction =998%9>

iestoc0 Enterprise 3reedin4 iestoc0 Enterprises 1on23reedin4 iestoc0 Ent.

+owB+alf Sheep ,ther brd lvstk #eeders Stockers

Help +ost per 4ound 4roduced =6.>6 =6.66 =6.66 =6.66 =6.66

4urchase +ost rkt ?vstk $-ollars per pound& :$.$$ :$.$$

4urchase 'eiht 4er 2ead $Enter in pounds& $ $

?vstk cost by enterprise = not #$">.

Total cost of production" Crops and iestoc0 )*+"56+

&arning: When entering the enterprise e8penses below, do not include e8penses for depreciation, interest ?opportuli!ing. Depreciation e8penses are included at the whole farm7ranch le!el and are entered below on this tab. Anterest iwhole farm7ranch le!el and is calculated below on this tab. 4amily li!ing is entered on the Statements page. Af includ

costs for crops or li!estoc2, these e8penses will be double counted.


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;sset and iability Cal

3e4innin4

;sset

66

Averae Calue 4er Acre =566

Total Cropland


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culations for the 3alance Sheet" Cash 9lo! and Income Statement

iabilities Short Term ?on Term

(nterest )ate 8.6@ >.6@

4ayment J 7 6

J 4ayments >6

Endin4 3e4innin4 and Endin4 iability Estimates1einnin 1einnin Endin

;d?ustment 4ercent -ebt @ Annual Annual Annual

Total =ollars 1y Asset Type -ebt 4rincipal (nterest 4rincipal

=6 96@ =9>%666 $=>%59>& $=%;6%67& $=


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'eal Estate ;rincipal

Period Principal Interest 3emaining

=5%;77 =;%;>6 :"","+/

9 =5%> =;% =%77 :"/,11

Annual ; =%5 :"/,+-9

(nterest 8 =56 =& =>%;6< =7%; :"9,+

=6 9 =;%6; =7%5; :"9",191

=%;6 5 =;% =5% =8%;5 =9% :#99,+9/

=6 95 =5%79 =8%69 :#"$,$

=6 97 =7%56 =;%965 :#$+,-9

9< =< >6 => 57< :$ +19


9/47

Mach A EBuip. ;rincipal 3ld4 A Improements ;rincipal 3reedin4 i

Principal Interest 3emaining Principal Interest 3emaining Principal

=9%;;> =%96 :#$#,"" =%9 =866 :1,1- =6

=5%;8 =8%68 :1-,"+ =%96 =;6 :-,// =6

=7%69 =>%7 :-",+"9 =%56; =>7 :/,9/" =6

=>%67 =7; =9;7 :#,--1 =6

=96%9;7 =%>99 :$ =%;;8 =79 :$ =6


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Total

stoc0 ;rincipal Shorter Term ;rincipal

Interest 3emaining Principal Interest 3emaining

=6 :$ =5%8; =%96 :##$,#$9

=6 :$ =%96 =;%>68 :-1,11+

=6 :$ =;% =>%5 :/#,9-

=6 :$ =8%6; =7%6 :",-"=6 :$ =96%7 =5%58 :"",$+9

=6 :$ =99%67 :$


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Help (ctivate )PC* Basic +nit *nsurance ,ption -. or '/ 00


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*otal Andemnity ;aid Gi!en ctual Bields :#,$$$

Help Net (ene&t of


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n

Basic +nit 1 o 2

Enter a B for each crop co!ered crop that you would li2e to insure.

' ' . . ' '

'ay Sum. 4allow 3ecrop (ar. 3ecrop WW SpringWheat 4la8

9$$ #$$$ "$$ 9$$ +$$ $

"$$ 9$$ +$$

$ "+ 9$

-+.$$> -+.$$> -+.$$>

#$$.$$> #$$.$$> #$$.$$>

:".$$ :9."+ :9.+$

#$$.$$> #$$.$$> #$$.$$>

$ $ 9$ #1.-+ "".+ $

" # 9#.+ "-." ".+ #.1

$ $ $ $ $ $

:$.$$ :$.$$ :".$$ :9."+ :9.+$ :$.$$

:$ :$ :#",$$$ :#1,"1# :9,9-+ :$

:$ :$ :$ :$ :$ :$

le !elo4 allo4s only 2 Basic +nits or illustrative purposes%


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$ $ $ $ $ $

" # 9#.+ "-." ".+ #.1

$ $ $ $ $ $

:$.$$ :$.$$ :$.$$ :$.$$ :$.$$ :$.$$

:$ :$ :$ :$ :$ :$

:$ :$ :$ :$ :$ :$

9$$ #$$$ $ $ $ $

Basic +nit 2 o 2

Enter a B for each crop co!ered crop that you would li2e to insure.

' ' . . ' '

'ay Sum. 4allow 3ecrop (ar. 3ecrop WW SpringWheat 4la8

$ $ $ $ $ $

" # 9#.+ "-." ".+ #.1

$ $ $ $ $ $

:$ $$ :$ $$ :$ $$ :$ $$ :$ $$ :$ $$

n to (asic nit F "


16/47

;remium

/-.$$>

++> /.$$>

/$> /.$$>

/+> +.$$>

-$> +.$$>

-+> ++.$$>

1$> 1.$$>

1+> 91.$$>

Ansurance ;remium Subsidy4actors ?4eb. "$$+@


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'


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$

#$--

$

:$.$$

:$

:$

$

'


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;ercent ;ercent %i!estoc2 3e!enue #$$> ;ercent Go!.

(ssets Lia!ilities

Balance heet 3e4innin4 Endin4 3e4innin4 Endin4 *nc+ash on 2and "566 >",> Accounts 4ayable $E!p& *"666 *"666 +as

+rops 2eld for #eed $E!p& ,"666 ,"666 Accrued (nterest $E!p& *"+, "6 0on+rops 2eld for Sale $(nc& +5"666 +5"666 +urrent 4rincipal *>",>* *5"-* 0on

arket ?ivestock $(nc& 6 6 ,ther +urrent ?iability $E!p& 6"666 6"666 +ap

,ther +urrent Assets $(nc& 5"666 5"666 Short Term 0otes 4ayable $E!p& 6 6

+ash (nvt Drowin +rops $E!p& 6 6 6 6

SuppliesH4repaid E!p. $E!p& 5",66 5",66 -ef. Ta! on +urrent Assets 6 6 +as

Total +urrent Assets ,5">66 ,"-> ,peratin ?oan +arryover 6 6 0on

1on2Current ;ssets Total Current iab. 5">* 5">* ,th

ach. H Equipment >,6"666 >55"666 1on2Current iabilities -ep

1reedin ?ivestock +,"666 5*"-- 4rin. on T.-. H +.?. >6,"6* *,*"+

)eal Estate $?and% 1lds% (mpr& "5,6"666 "5-"-66 Total 1usiness ?iab. >-5">56 >>">, +asTotal 3usiness ;ssets *">">66 *"-*"-6 3usiness 1et orth ",*"56 ",*>"*** +as

Chan4e in EBuity 9rom 3e4innin4 to End of Dear -8;"*

?oan 4roceeds +apital Assets 6 1reedin ?ivestock Asset 4urchases -"-- ta 0onB1usiness (nflows)evenue ach H Equip H )eal Estate 4urchase 6 3e4,ther 0onfarm (nflows 6 ,wner withdrawals +6"666 1et

,ther 0onfarm (nflows 6 +ash Ta!es 4aid $(ncome H SS& 6 1on

Total Cash *n=o4s )5+*"6* ,ther +ash ,utflows $0ot E!penses& 6 &!

T./. 0 Term /ebt! $.L. 0 $apital Lease Subtotal )>*">,* Ass

,peratin ?oan 4rin. 4ayments )+"*5* Cal

Total Cash ,ut=o4s )5>"->> 'ep

;nnual 1et Cash 9lo! (neer G $ero% >",>

4ercent +ost of 4roduction B +rops #$$> 4ercent cost of 4roduction B ?ivestock #$$>

,ther +urrent ?iab. $1ot ;d?.&

'ote: *his program is designed to teach concepts of &nancial analysis and get a rough initial loo2 at a farm7ranch operation. At is noanalysis of an indi!idual operation. At does not ha!e the capability to analy)e detailed information.


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Financial Statement atios

Liuidity Current atio Beginning Ending Current (ssets


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%abels starting in column ( on this tab are from the ccrual dJusted Ancome

%abels starting in column < on this tab are from the (alance Sheet

Ending Beginning

An!entory An!entory

Kalue 4rom Kalue 4romCurrent Current

'on?Cash *ncome (dustments (ssets (ssets

Crops Held or Sale -*nc/ :+,$$$ :+,$$$

)arket Livestock -*nc/ :$ :$

,ther Current (ssets -*nc/ :#+,$$$ :#+,$$$

*otal Non


23/47

*ncome SS Ta3es -Cash 'on?Cash/

De% Ta3 on Current (ssets :$ :$

,ther Current Lia!% -'ot (d%/ == *his line is not adJusted on the Ancom

;lease read the comment on the Stateme

*his line is pro!ided to help illustrate the

function and reconciliation of the &nancial

,nly ccrual dJustment ;o


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tatement

ccrual

*ncome

Ancome

Statement

:$

:$

:$

:$

:#1,$$$!estoc2.

ccrual

E3pense

Ancome

Statement

:$

l

nce Sheet

->@?/ to the

tatement

->@?/ to the


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:$

Statement.

ts page of this spreadsheet.

tatement of wner Euitys

statements.

tion of *a8es


26/47

Page do4n or additional enterprise !udgets Goto6


27/47

Chemicals 19.00 19.41 #."#

Custom operations 2 21.34 21.49 "#."

,uel lube and electricity 20.95 19.75 "$.9+

epairs 17.55 18.24 #-.$ ired labor 1.78 1.78 #.-1

ther ariable cash epenses 3 0.25 0.24 $."+

Total, operating costs 134." 130.## #9"."

5eneral %arm oerhead 7.15 6.75 /.+

aes and insurance 9.77 9.78 .-1

#/." #/.+9 #/.-9

&nterest on operating capital 3.41 3.09 9."+

"$.99 #./" #.1

#+#.1- #-.# #./

#++."1 #+$.+$ #+".1

Cash cost per unit o crop produced Dollars ;er (ushel

:#.+1 :#.99 #.+

:#./" :#.9/ #.

llocate! o"erhea!: ## $on Cash Costs *ollars per planted acre

pportunity cost o% unpaid labor 22.77 23.10 "".

Capital recoery o% machinery and euipment 56.52 59.30 +-.#

pportunity cost o% land (rental rate) 53.57 55.33 +.+

*otal allocated o!erhead 0 Non0cash or estimate #9".1/ #9-.-9 #9+.9$

otal costs a%ter addition o% 89llocated oerhead82#4.73 2#.14 "1.

2##.14 2##.23 "11.#

4i8ed cash e8pense, e8cluding interest

4i8ed cash e8penses including interest

*otal cash e8penses e8cluding interest

*otal cash e8penses including interest

e8cluding interest

including interest

e8cluding interest

including interest


28/47

Cash e*penses: *ollars per planted acre *olla

+eed 46.31 47.98 -.#+ 47.69

,ertilier 121.94 109.52 ##+.-9 88.02

Chemicals 82.79 83.05 1"." 77.22 Custom operations 36.54 37.64 9-.$ 22.78

,uel and lubrication 96.85 90.63 9.- 55.13

epairs 66.93 66.24 //.+ 55.89

ired labor 198.59 204.63 "$#./# 111.98

s 1""2 ,arm Costs and eturns +urey o% sugarbeet gro!ers ad?usted %or year-

@ote: +ugar beet regions de%ined as: 5reat AaBes (/ichigan hio) ed ier alley (/innesota eastern @o

@orth!est (&daho regon ecept Elamath County) and +outh!est (Cali%ornia Elamath County o% regon).

4i8ed cash e8pense, e8cluding interest




e8cluding interest

including interest


29/47

#- and #1. Source SD 0 E3S t http677www.ers.usda.go!7(rie&ng7farmincome7data.htm

Wheat Oats

1""# !g. -01 1""7 1""# !g. -01

31.08 "-.19 68.62 65.89 /-."/

per planted acre Dollars per planted acre7.27 -./ 6.72 3.97 +.9+

12.61 #9.-9 9.62 8.46 .$

8.28 1.9# 2.32 2.32 ".9"

2.98 ".1# 7" 2.41 2.41 ".#

5.94 /.9 10.59 9.11 .1+

13.52 #9.#+ 14.75 13.73 #."

2.69 "./# 0.36 0.38 $.9-

0.03 $.$9 79 0.45 0.40 $.9

3.32 +." 47.22 40.7# .$$

4.20 .-1 3.77 3.56 9./-

8.78 ."$ 7.75 7.61 -./1

#".1 #9.- ##.+" ##.#- ##.9+

8.27 1.1- 5.13 5.40 +."-

"#."+ "".1 #/./+ #/.+- #/./#

//.9$ /1.9 +1.- +#.+ ++.9+

-.+- --."/ /9.1- +-.9+ /$./#


30/47


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s per planted acre

49.88 1.-

80.66 1.9

75.77 -/.+$20.36 "#.+-

45.41 +$."-

57.88 +/.1

119.13 ##+.+/

14.34 #.$#

17.20 #-.+#

6.24 /.9

1.38 #.-$4#.4" $.$/

44.07 +.$-

42.63 #.

#6.70 1-.$+

57.00 +.

143.70 #".$

72.1" +--.##

62".1" /9".#$

ollars


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*his sheet includes cost of production estimates for


33/47

"02.3 #4.2 #7#.3 "#3.71

"13.2# #64.7 ###."3 ""7.10

7# E8cludes Anterest on operating inputs, pportunity


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1.13 1.24 1.1" 2.2#

##.$+ #$.# 10.60 #9.-+

11.67 10.# 11.26 14.##





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r&it-&l /i 'asin an! /ange

1""# 9g. "7-"# 1""7 1""# 9g. "7-"#

ollars


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"47.2 "6.62 "".1 ##2.20 "20.#6

"60.0 "7#.# "70.30 #"2.31 "31.31

of machinery, pportunity cost of land costs of machinery, pportunity cost of land

per i!est

1""# 9g. "7-"#

r C!t. +old

15.48 14.40

0.94 0."6

0.68 0.7217.10 16.07

4.07 4.30

0.13 0.13

0.18 0.1#

1.14 1.2

1.67 1.#30.14 0.13

7.33 7.#1


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2.0 2.3"

#".-1 13.27

14.07 14.4#


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1ulls are assumed to have a three year life and are always fully depreciated when they are sold.

All bull revenue is treated Gust like "ordinary income%" even thouh it is listed under +apital Dains?oss on 1reedin ?iSee the Enterprise tab of this template in cell block (9 throuht ?5.

9 1ulls $or other male breedin livestock% )ams for e!ample& are the only type of purchased breedin livestock included in th

#emale breedin livestock are always raised and assined a base value by the user. 2owever% the user can enter any typ

in cell A8

5 0o asset sales% or death loss of breedin livestock% etc. is allowed in this spreadsheet.

7 The beinnin and endin values on the balance sheet for current assets and liabilities are $should& always be the same.

This eliminates accrual adGustments on the income statement prior to the user enterin or chanin a specific number to

show an accrual income or e!pense. (t simplifies teachin the concepts.< -ue to the desin of this spreadsheet% interest and depreciation are handled separately from the basic cost of production fiu

for each enterprise. This is necessary to calculate and display principle and interest for all loans on the various financial stat

(t is important that these numbers are separated out of the enterprise cost of production fiures% to the best of your ability% re

that this template is basically desined to teach interaction of and how to interrupt financial statements.

Separate out:

(nterest or opportunity costs chared on operatin costs

(nterest or opportunity costs chared on capital assets

-epreciation on capital assets included in the enterprise costs

> Some basic assumptions about timin are included when makin entries to illustrate assest purchases% receivin captial contor makin capital distributions.

(t is always assumed% in this system of financial statements% that these activities happen at the end of the

year when there is no opportunity for a purchased or contributed asset to enerate any additional

revenue to be included in this analysis year.

The assumption with distributed assests is the revenue from that particular asset has already been received durin the

year and no reduction in revenue occurs because of the assetLs disappearance from the balance sheet durin the year.

?ist of defaults and/or assumptions used in this spreadsheet template.

of purchased breedin livestock on the Enterprise tab under the Purchase/Contribute/=istribute Capital ;sset sectio


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reducin the e!pense stream% hence increasin net income.

; (f usin the purchase capital asset section on the Enterprise tab% the assumption is that% if financied% no 4 H ( payment is ma

durin the year of purchase. ,ther e!penses like ta!es% and insurance are also not made durin the year of purchase.

This assumptions helps to illustrate the fact that the mear purchase of an asset will not increase equity% (.e. you can

not buy eBuity. 3ou must employ the asset in a manner that earns equity throuh increasin the revenue stream or


46/47

vestock.

initial setup.

es entered

ements.

emberin

ibutions%

startin


47/47

e on the asset

dairy farm financial

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