| OCR Text |
Show WHAT FARM ACCOUNTING MEANT ' IN THE MANAGEMENT OF A FARM TF Successful Farmer Tells How Pencil Helped Guide His Operations and Swell His Income An Aid to Better Credit Shows Profits and Prevents Losses. THE owner and operator of one of the most successful dairy farms in Wisconsin prepared recently for the Agricultural Commission of the American Bankers Association a first hand statement of the part farm accounting has played in the management of his enterprise. This operator, W. J. Dougan, tells the following story: "When I started farming I began keeping a simple cash account, but soon found that it was not sufficient accounting for rarm purposes. Such a record did not take into consideration the vital fac- complete financial statement before tors of Improvements, growth of live- him the banker can Intelligently deter- stock or depreciation. mine what credit I should have. With "Since 1910 I have kept a complete a full knowledgj of the farm profits account on the accrual basis. The in the past, I know what credit I accounts, however, are no more than should accept. No farmer or business any farmer can easily keep. The out- man should accept credit from his standing benefits from keeping such bank unless he Is able to put the accounts might be listed as follows: money Into productive Investment, and Trie Way It Works his margin of profit assures the ability "1. Income tax reports made easier, to repay the loan within a reasonable Accurate and dependable income tax time. reports can be made from the yearly "For the farm this reasonable time accounts. By keeping them on file I cannot be three or six months. The : am always ready to satisfy the tax farm turnover is too slow for that. A inspectors. helpful and just period of farm credit "2. Accounting makes possible a for working capital must be from one budget system. With the accumulat- to four years. ed data of the past years, I can make "There is another benefit from ac- out the budget for the coming year, counting the benefit of knowing The Income being fairly stable, the whether one is going up or down. By budget problem is to adjust the ex- extra sales one might be flush of penditures. If one branch of the bust- money and buy heavily, thinking he Is ness will need extraordinary expendi- coming out ahead, but in reality he ture such as new machinery, there is sacrificing the future. On the other must be a cut in some other branch, hand, one might feel pinched, and such as building or livestock pur- have little money to spend, but In chased, or fencing. reality he Is laying up capital." "3. Accounting gives a true basis The bankers Agricultural Commis for credit. Especially has accounting sion has suggested the following form meant for me larger credit and happy of farm credit statement, Indlcatlnt relations with my banker. With a the records necessary to be kept: SUGGESTED FARM CREDIT STATEMENT (Adapted from blank used by Federal Reserve Bank, Chicago) One Of The First Important Factors In Farm Accounting Nam. " Address'"'"" Ruslness Date of Statement A ts Liabilities Casm ok Hand am. Ik Bakk I Ow TBI Following Baku: TJmitd Htaits HecniiTiEi. ,... Baku Omen Salable Sccomnu 8ectixzo Br i.. ArcoTKTU Dc Me . ...Bakk . ..... Cbatk, Feeds ako Farm Product. . . . . Secdrbd ST , Utemiied in Schedule Below Livestock. (Iteuized in Schedole Below) Norn Payabu to Relativee Loaks Doe Mb, One Year oa Lxu Matoritt. Secure ft? Ctbe Qcice Assets Notes Payable to Others Secured by . Accounts Payablb ., Interest and Taxes Due Within Ohb Year. . .... Cass Rent Due on , , v. Totsl Quick Asts TaUl Cumnt Llsbilltiss Verm Lurleuents and Tools Real Estate Mortoaqes (First) , Machinery, vis. Tbreshers, Balers, Tractors, : , .... ETC. Abtomojiles and Truces , ..... Parm Land (Iteuiud in Schedule Below) ....... , ......... QMrROvEMENTs Valued at . ). Cmr and Town Prokety Real Estate MorraAOBs (Junior) ..... (Iteuieed in Schedule Below), bIortoaoes or Loans Due After One Year : ". ,. lm ESTUENTS OR OTHER ASSETS (iTXIillEP FULLY) . , l i ToUl LUbilltisE N.l Worth... T"'' I T.I.I. LIVE STOCK ...Bullions! Dur, Bulls I BmI Bulls t .Hosts ... .....Rm " I. . ! . . I .Cbikm Y...1 . -Hoists I WilkCows I Best Cows ( Brood Sows I Ess I Turkeys I lues Htiltrs Sttrn I.: Tip t Wethers t Other Poul. ( ...Colls I.......Cs1tw t..... .Feeders Btoek Hois Lambs I Bees CroiJini Crops Grain and Firm Products en Heiui r Acres Corn. Acres Oats. Bu. Corn Bu. Osts Acres WheuL Acres Lejuroes. .Bu. Wheel T Ha) , Acres OrcIiErd , Acres Other Ejy IlKheBed Fetss isl'. ...f |
