Financial Statements - Nebraska Extension

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Financial StatementsNebraska Farm and Ranch Financial LiteracyTwo Hands on the Wheel Objectives Get you familiar with basic financial documentation.
Balance Sheet Cash Flow Statement of Cash Flow Cash Flow Budget Record Keeping.
Income Statement Net Farm Income Understand purpose for each Balance Sheet 1 Balance Sheet 2Meeting Financial Obligations.
Financial Snapshot Financial SnapshotWorking Capital Working CapitalDebt Asset Ratio Income Statement Debt Asset RatioNet Worth Profitability Net WorthStatement of cash flow.
Fund sources usesStatement of Owner EquityReconciles changes betweenBalance Sheet 1 2 Uses for a Balance Sheet.
To know assets and liabilities on a regular basis Required when applying for a loan Help guides considering a major change Risk assessment Building a Balance Sheet.
1 Inventory assets and resources2 Determine asset values3 Record liabilities Taking an Inventory2 Buildings.
3 Breeding livestock4 Machinery equipment implements tools5 Operating inputs purchased not yet used up6 Harvested crops in storage7 Market livestock.
8 Financial assets Asset Valuation methodso Net selling priceo Purchase cost less depreciationo Replacement cost less depreciation.
o Replacement cost for equivalent function lessdepreciation Income capitalization Market value Liability Information.
1 Loan information2 Current portions of principal and interest3 Accounts payable4 Unpaid accrued interest5 Delinquent principal and interest payments.
6 Credit and debit card account information7 Personal liabilities if using consolidated b s Balance Sheet as of a single date Consolidated Personal BusinessCurrent Assets Current LiabilitiesNon Current Assets Non Current Liabilities.
Non CurrentNet Worth or Owner EquityNet Worth Assets Liabilities Balance Sheet Two pairs of columns due to two methods of.
asset valuation Cost basis actual cash plus investment expenses new boundary fence cost basis materials plus labor tobuild fence New equipment purchase delivery set up costs.
Market value what a willing buyer would pay you Key RatiosFrom the Balance Sheet Working Capital Debt Asset Ratio.
Net Worth Bankruptcy A Financial Tool Debt Relief outside of Debt forgiven inbankruptcy creates an bankruptcy wipes the slateincome for which clean however impacts.
income tax must be credit worthiness andtakes a while to earn back Chapter 7 is a dissolution Chapters 11 12 and 13 areplans to reorganize and.
work out debt under courtsupervision Objectives Get you familiar with basic financial documentation Balance Sheet.
Cash Flow Statement of Cash Flow Cash Flow Budget Record Keeping Income Statement.
Understand purpose for each Cash Flow Budget Spending plan for whole farm financial planning Usually created from past experience with minoradjustments.
If major events have happened lost leases changed major enterprises etc thenreconstruct new plan Refer to blank cash flow budget form Statement of Cash Flow.
Divides cash flows and uses of cash by Operating activities Investing activities Financing activities Historical document looking back on how cash.
moved through an operation Ties into the Income Statement Cash Flow Makes Your BusinessNo Cash FlowNo Business .
Tips for Recordkeeping1 Keep categories simple2 Tags Quicken or Asset Class QuickBooks 3 Work on records everyday even for a few minutes 4 Run reports to catch errors.
5 Share reports with key decision makers6 Let the software do the work7 Manage the paper trail as fits your needs Demo Software How the Pieces Fit Together.
http www montana edu softwared... documents software RDFinancia... entativeFarmRanch Oct 2011 swfIncome Statement Objectives.
Get you familiar with basic financial documentation Balance Sheet Cash Flow Statement of Cash Flow Cash Flow Budget.
Keeping Records Income Statement Net Farm Income Understand purpose for each Use of Net Farm Income.
Pay income taxes Family living withdrawals Source of investment dollars Pay principle portion of debt Values management.
Income Statement Income revenue fromproducts commodities cash Less costs incurred to produce a product tosell cash .
Adjusting for changes in inventories non Results in net farm income for a certainperiod of time usually a year Accrual Accounting Accounts for changes in inventory.
More accurately measures income generatedwithin one year Is better for evaluating business results and Structure of the Income Statement Revenues.
Operating expenses Financing expenses Net Farm Income FFSC s gross revenue format Refer to handout Building an Income Statement.
1 Cash income and expenses from farm accounting2 Inventory information from the inventory process3 Purchases and sales of inventory items4 Depreciation from the depreciation schedule5 Net Farm Income calculated.
Gross revenuesLess operating expensesLess financing expensesPlus or minus inventory changesEquals Net Farm Income.
How the Pieces Fit Together Statement of Owner Equity Allocates how wealth was accumulated on balance Sources of wealth Earn it from production.
Investments Government policy Assets appreciating Inheritance Off farm income cash infusion .
Change due to retained earning the business market asset values policy changes personal net worth .
Wrap Up DiscussionsNon farm ranch incomeDiversificationBe a neighbor lend an earKeep two hands on the wheel .
Statement of cash flow. Fund sources & uses. Statement of Owner Equity. Reconciles changes between Balance Sheet #1 & #2. Let’s review the overall cycle of financial documents. Start with a well constructed balance sheet. It is the financial snapshot of your operation for one day. (Not unlike taking your picture on your birthday, year after ...

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