Show 1 WHAT WART FARM ACCOUNTING ME MENT NT 0 IN THE MANAGEMENT OF A fARM I Successful Farmer Tells How Pencil Helped Guide His Hia Operations and Swell His Income Income Income-An An Aid t to toI toJ o t. t J T Better Credit Credit Shows Shows Profits and I 1 I to Prevents Losses w j i i r- r THE owner and operator of one of the most successful dairy J- J 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. W J. 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 farm Carm purposes Such a record did not take tako Into consideration the vital factors fac fac- factors tors of improvements growth of livestock live stock or depreciation Since SInco 1910 I have haye kept a a. complete account on the accrual basis The accounts however are aro no more than any farmer can cau easily keep koep The outstanding out standing benefits from keeping such accounts might be listed as follows The Way It Works 1 Income tax reports made easier Accurate and dependable Income tax I reports can be made from tram the yearly accounts By keeping them on file filo I Iam Iam Iam am always ready to satisfy tho the tax Inspectors 2 Accounting makes possible a budget system With With the accumulated ed data of the past years I can make mako out the budget for tor the tho coming year The Income being fairly stable the budget problem Is to adjust tho the ex ox- If one branch of at the business bustness bust busi ness will need extraordinary expenditure expendi taro ture such Buch as new machinery there must bo ho a cut In some other branch such as building or livestock purchased purchased pur pur- chased or fencing 3 Accounting gives a true basis for Especially credit Especially has accounting meant for mo me larger credit and happy relations with my banker With a complete financial statement before him the banker can Intelligently determine determine determine deter deter- mine what credit I should have With Witha a full knowledge of the tho farm profits In ill the past I know what credit I should accept No farmer or man should accept credit from his bank unless he be Is able to put the money Inlo into productive Investment anc anchis and his margin marsin of profit the ability to repay the tho loan within a reasonable time For the farm this reasonable time cannot bo be throe three or six months The farm tarm turnover Is too slow for that A helpful and just period of farm credit for working capital must be from oneto ono one onoto to four years yearn Thero There Is another benefit from accounting ac ac- ac- ac counting the counting the benefit of knowing whether one Is going up or down By extra sales one might bo flush o ot of money and buy heavily thinking he Is coming out ahead but in reality he heis heis heis is sacrificing the future On the other othe hand one might feel pinched and ha have e little money to spend but in reality he la Is s laying up capital The bankers Agricultural Commission Commis- Commis slon sion has suggested the following form of farm credit statement indicating the records necessary to be kept SUGGESTED FARM CREDIT STATEMENT Adapted from blank used by Federal Reserve Reser Bank Dank Chicago One Of The First Important Factors In Farm Accounting s. s t. t JA Name Namo NI ame Address Business Date of or Statement Aeta Aeh c. c CAw Dr fAND AND Ix 11 Bs BAi I I O Ow Tnt mc D u STAn n An r NN r ME HIrl N. N 1 FuM AD FAau tY ND W Snow Buoy IN III 1 TO h. r. r T Mr Jr OL of r IY DY 1 Omit Non TO N 1 It h N A re r. TAXI YIn 91 CAUl RE T iN N. N N r Quick Ah Total Current Curent r. r TI AND D Toot r REL aTAn Ulu L T n I 1 1 N. N AND r. r IN NN AT H AD TON rona N. N r. r REAL stAn stAnIo Io Sc E L il 1 Ni J AC Lo AnD On N. N NI I l. l UTI I 1 L. Ir Total Ua N Net o th I Totals Total LIVE STOCK Stallions s. s Dairy nun Bulla I. I Ded 1 Bulls I. I BoAn I. I a I. I S. S n s I. I Ca s 1 s Bee f Co s 1 L i s. s f. Tulle y 1 s. s Mula S. S s. s 51 I. I Fi I. I Other S S. S Coil CoILl S. S I. I F t. t 1 I. I s. s D S. S Growing Crop Crops Grain Cin and nd nd Farm F i on en Hand Com Du Com B h 1 AmI I I I NAcres Bu mat Too lIay G. G N Lr Other Ily y NN r dt I d. d SCHEDULE OF REAL HEAL ESTATE Ka u improved or o. No or of Acm of Incent Giving County and Title in t Nam of 01 Unimproved td or Lou Loll Val Value Morl c. c Des I i a N. N N. N N L. L N. N N. N N r. r n. n n. n n. n N H. H n. n n. n I N e. e I N. N I 1 C lf na Acao I fun i. i N. N N. N ATA 10 or 07 r. r h 4 for or IU Ye cAa IVr I SZ I LITt ii Ft e Z ON N NN 1 t |