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Farm Information Systems

Farm Information Systems. Key Questions: Chapter 3 Farm Information Systems. Why do farmers keep records? What are the alternatives for farm accounting? What information is contained in a farm information system?. Why Do Farmers Keep Records?. Reporting Income tax returns

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Farm Information Systems

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  1. Farm Information Systems

  2. Key Questions: Chapter 3Farm Information Systems • Why do farmers keep records? • What are the alternatives for farm accounting? • What information is contained in a farm information system?

  3. Why Do Farmers Keep Records? • Reporting • Income tax returns • Landlords, partners • Loan applications • Planning • Provide data for budgets • Evaluation and diagnosis • Look for strengths and weaknesses

  4. Farm Accounting Systems • Hand record books • Personal computer system • Paid accountant • Farm business association

  5. Components of Farm Accounting Systems 1. Cash receipts 2. Cash expenditures 3. Inventory of current assets • crops, livestock, supplies • usually once a year 4. Inventory of capital assets • machinery, land, buildings, equipment • depreciation schedule

  6. Components of Farm Accounting Systems 5. Credit records (loans and payments) 6. Labor records • names, hours worked • withholding for taxes 7. Family living expenses 8. Production records • Crops, livestock

  7. Decisions About Farm Accounting Systems • Accounting Period • Hand Book or Computer System • Cash versus Accrual • Single Entry versus Double Entry • Amount of Production Information • Whole Farm versus Enterprise

  8. Computer Record Systems • General purpose small business systems • Quicken, Quick Books, Peachtree, etc. • Usually under $100 • OK for income tax and basic financial statements • No farm orientation • No production records

  9. Farm and Ranch Accounting Systems • Chart of accounts designed for agriculture • Track quantities as well as $ • Most cost $400-$600 • Some offer extra modules • Payroll records • Crop or livestock production records • Depreciation schedules

  10. Computer Record Systems Options • Write checks • Customize chart of accounts • Divide by enterprise (profit center) • Summarize by production period • Ease of data entry • Create income tax forms • Export data for other uses

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