• TABLE OF CONTENTS
HIDE
 Front Cover
 Introduction
 Review of budgeting and cash...
 Before you do anything else
 The farm financial planning...
 Additional notes on Visicalc
 Running the example
 Conclusion
 References
 Appendix A
 Appendix B
 Back Cover














Title: Farm financial planning system
CITATION THUMBNAILS PAGE IMAGE ZOOMABLE
Full Citation
STANDARD VIEW MARC VIEW
Permanent Link: http://ufdc.ufl.edu/UF00084345/00001
 Material Information
Title: Farm financial planning system
Series Title: Farm financial planning system
Physical Description: Book
Creator: Halsey, Larry A.
Publisher: Florida Cooperative Extension Service, Institute of Food and Agricultural Sciences, University of Florida
 Record Information
Bibliographic ID: UF00084345
Volume ID: VID00001
Source Institution: University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: oclc - 228029810

Table of Contents
    Front Cover
        Front Cover
    Introduction
        Page 1
    Review of budgeting and cash flow
        Page 2
    Before you do anything else
        Page 3
    The farm financial planning system
        Page 4
        Page 5
        Page 6
    Additional notes on Visicalc
        Page 7
    Running the example
        Page 8
        Page 9
        Page 10
        Page 11
        Page 12
        Page 13
        Page 14
        Page 15
        Page 16
        Page 17
        Page 18
        Page 19
        Page 20
        Page 21
        Page 22
        Page 23
        Page 24
        Page 25
        Page 26
    Conclusion
        Page 27
        Page 28
        Page 29
    References
        Page 30
    Appendix A
        Page 31
    Appendix B
        Page 32
    Back Cover
        Page 33
Full Text





i)Ii


2
3
4

" --
7








8
1

S


-- -- --
i I







25 F R 1 FI Ill
27
283 ______~_



i', ___ Lawrence A


I t... __. ..i .. .....


.


Ur
-i Jo


j'. I__.. ~ i 1
2
3

4-- .'I -

-; I
I I
-I~ 58


ar'5 Ou~de '_iiv---i vf

'4
-I :1

NClRL PLAN iIi
1i 1 1 I 1 11 27 I


YSTE i


. Halsey and Timothy D. Hewitt




orida Cooperative Extension Service
stitute of Food and Agricultural Sciences
university of Florida, Gainesville i
hn T. Woeste, Dean for Extension

II


29
29
30




37

-I-- -4 ~ ---
I; ______ _______ I 5
it39

IL
-. - _I I -I..l


~_~__~_ _._.__


Circular 619
-. ..... . ... .-. . -... ..- .. . .


i:-_













FARM FINANCIAL PLANNING SYSTEM


Lawrence A. Halsey and Timothy D. Hewitt*


INTRODUCTION

Microcomputers and enterprise budgets are both powerful tools for
farm managers. Computers allow for rapid, frequent calculations, and
are growing in popularity in on-farm use. Budgeting is an absolute
necessity in making long or short term farm production and farm finan-
cing decisions. The tedious, unexciting nature of budgeting leads
farmers to use this tool less often than they ought.

The advent of "electronic spreadsheets" provides a means of reduc-
ing the tedium and drudgery of budgeting. Presented here is a system-
atic method of farm enterprise budgeting. There are also a number of
analyses, summaries, and other devices to help the farmer prepare accu-
rate, timely reports which are essential in financial planning. Used
together, they are a FARM FINANCIAL PLANNING SYSTEM.

The analysis was developed using a Radio Shack TRS-80 Model III
microcomputer (48K, TRS DOS 1.3) and VisiCalc (4). Due to the limits of
capability in the combination of hardware and software, the program is
split into several steps with data being manually transferred from one
sheet to the next. Larger capacity computers and other spreadsheet
formats would allow the entire process to be run on one single sheet or
several sheets under one common operation (2). Users should be familiar
with the basics of VisiCalc; data entry; recalculation; and label,
value, and formula assignment. As with any microcomputer software or
applications program, the features of this program will become more
useful as you gain greater familiarity with the unique features of your
computer. Refer to the computer and software user's guides for your
particular spreadsheet.

This manual assumes a working knowledge of both microcomputer
spreadsheets and of basic principles of farm enterprise budgeting.
Methods and specific features of the budgets will be noted later in the
discussion of the example.





LAWRENCE A. HALSEY is County Extension Director, Jefferson County,
Florida Cooperative Extension Service, Institute of Food and Agricul-
tural Sciences, University of Florida. TIMOTHY D. HEWITT is Area Farm
Management Economist, ARC-Marianna, Food and Resource Economics Depart-
ment, Institute of Food and Agricultural Sciences, University of
Florida.












REVIEW OF BUDGETING AND CASH FLOW


We will begin by reviewing a few farm management principles used in
this Farm Financial Planning System.

Enterprise Budgeting

An enterprise budget is a listing of all income and expenses asso-
ciated with a specific crop, commodity, or operation. It provides an
estimate of profitability for some production period, usually a season
or a year. The combination of budgets developed for the various enter-
prises provides a "picture" of the complete operation for purposes of
business financing, forward production planning, and management control
(3).

Farm budgeting assists in making decisions about the amount of
various products to produce, the methods of production to be followed,
and problems of when and how to market farm products (11).

Variable costs are the actual cash expenses incurred for purchasing
the inputs necessary to produce the commodity. They vary proportion-
ately with the level of production (13).

Fixed costs are overhead expenses and ownership costs for the
equipment and facilities. Fixed costs relate to the production
resources that do not change within a particular production period.
These costs will usually occur even when production is not undertaken.

Risk in Farm Finances

The key to survival and profit in agriculture is not to avoid risk
but to manage risk. Investment, production, marketing, and financial
risks exist in agriculture.

Farmers must incorporate risk and variability in the decision-
making process. Farmers know with certainty the level of purchased
inputs that they use on a particular crop, but the yield and market
price are not known with certainty until after the crop is harvested and
sold. One way to estimate the income effects of production and market-
ing risk on a particular enterprise is called a decision-tree analysis.

The decision-tree approach will force the farm manager to estimate
costs, likely yield ranges, and likely selling prices. The analysis
then shows the consequences of better or worse than expected outcomes.
Production and marketing parts of the particular enterprise decision are
tied together before money is spent (8).













Cash Flow Budgets

Cash flow analysis is an important financial management instrument
that assists in planning and managing business activities. Cash flow
analysis is an accounting technique in which cash incomes and expenses
are listed over a specific time period. The figures used in a cash flow
analysis are either actual numbers from the past or projected budget
numbers for a specific time in the future. The information is usually
organized into monthly listings but may be quarterly, annually or some
other period.

The cash flow budget has three components: 1) cash expenditures, 2)
cash incomes, and 3) a flow-of-funds balance in each particular time
interval. The flow-of-funds implies the continuous movement of cash.
This is precisely the information that the farm manager needs to plan
for adequate money management. The flow of funds analysis is appro-
priate for managing the farmer's own money as well as borrowed funds.
It is used widely in all aspects for financial planning of the farm
(10).

Financial planning is based first and foremost on making accurate
guesses, predictions, or forecasts about the future, in light of past
experience. Well kept records of past expenses and of yields are essen-
tial for an accurate appraisal about what the future (input levels,
market prices, possible or probable yields) holds. Neither computers
nor economic analysis will assure profitability. But both, together
with good judgment, may help the farmer--and his financial backers--make
sound decisions.





BEFORE YOU DO ANYTHING ELSE

Two diskettes are included with this program. One is an example
spreadsheet that follows the instructions in this manual. The other is
to be used for your working Farm Financial Planning System. With this
spreadsheet you will enter data that is specific to your operation.

The first thing you should do upon receiving this program is make a
BACKUP, or copy of both diskettes. Consult your computer owner's manual
for more information on backing up a diskette. Then, if you have a
printer, use the spreadsheet on one of the diskettes to prepare a
printed copy of the sheet to provide a Listing of all the formulas,
labels and values which make up the sheet. To do this, first load the
spreadsheet. Once VisiCalc is loaded into the computer, type /SL
STEPONE. Then type /PP- and move the cursor to the bottom right
coordinate of the sheet. Next, type /SS:P. Repeat this printing for
each of the various individual sheets.












Keep both backup diskettes, the example of the sheet, and the
format listing in a safe place. If anything should happen to the
working copy of the sheet, you may repair or replace it. Be assured,
something unexpected occurs frustratingly often.

As you work with the sheet, store or save data onto the disk
periodically. As with any software, make frequent updates on your
"working" backup copy.





THE FARM FINANCIAL PLANNING SYSTEM

The Farm Financial Planning System is made of up seven VisiCalc
templates:

1. TITLE
2. STEPONE
3. EQUIPFAX
4. BUDAID
5. CROPBUD
6. LVSTKBUD
7. PLANFARM

The sheet, TITLE, is a cover page with a few general user tips. It
does not involve any analysis or computation. After the first reading
of it, you may not wish to read it again. It also refers to the Farm
Computer Support Group, Florida Cooperative Extension Service, IFAS,
University of Florida, where you may get help in farm management and
farm microcomputer use.
The program begins with STEPONE, an inventory and associated costs
of the fixed resources of the farm. Annual costs of fixed resources are
estimated in this section: Land, Equipment and Facilities, and General
Farm Overhead. A Management Fee may also be assigned. Fixed costs are
summarized. Note is made of totals and other calculated data, for input
into other worksheets.

The second template is CROPBUD. Per acre and total enterprise
costs and returns are generated in this section.

Data from STEPONE are keyed into this crop budget. For example,
total fixed costs are entered in, then the procedure allocates fixed
costs to the enterprise. Several analyses accompany each budget
including a decision-tree analysis of price and yield variability and a
break-even comparison with an alternative crop. CROPBUD may be repeated
as often as necessary to calculate costs and returns of various crops.
When you save worksheets each must be assigned a unique file name to
eliminate the chance of erasing one in the process of storing the next.


----------------------------------I ^^^ ^^^ ^^ ^ ^ .^_..^ ^_^ ^^ I

























4 EQUIPFAX


Figure 1: Model of the Farm Financial Planning System.












LVSTKBUD, the next worksheet, is used to develop the livestock
enterprise budgets. As with CROPBUD, a varying number of budgets may ,be
calculated and saved.

Finally, cost and returns from the various individual enterprises
are combined in a whole farm analysis and summary in the file named
PLANFARM. Two different elements are included in PLANFARM. Both are
vital to farm and financial management. Both are drawn from the farm
manager's best guess of what level of inputs will be used in a
production program, what the price of those inputs will be, what will be
the yield resulting from that program, and what market price will
prevail! for the product. The validity of the farm plan depends very
much on the accuracy of the estimates made in preparing the enterprise
budgets.

The first element is the Enterprise Budget Summary. Variable costs
and returns for each crop and livestock enterprise are entered. Returns
over variable costs are calculated. The fixed costs (again from
STEPONE) are subtracted for a net return. Since costs of land, labor,
purchased inputs, management and fixed resources--including family
living expenses--have been charged to the enterprises, the NET REVENUE
represents a return to risk or a whole farm profit or loss. Certainly,
in the short run the farmer must cover variable costs. To remain in
business over a long planning horizon, the farmer must at least break
even on both variable and fixed costs.

The Enterprise Budget Summary may guide the farmer in determining
what crops or livestock to produce for the highest profit potential.
The summary is a management tool which guides the producer in protecting
the long term viability of the farm. It is not a very effective tool
for determining financial needs or debt repayment capability nor for
measuring cash flow.

The second element of PLANFARM is a Cash Flow Analysis of the
various enterprises in the farm plan. Cash outflows and inflows from
the enterprise budgets are allocated to monthly periods. Non-cash
outlays are not included. For instance, fixed costs of equipment
representing depreciation and interest on average investment are
excluded from cashflows. Likewise, interest on variable costs is
omitted. Interest in this case is an "opportunity cost", rather than an
out-of-pocket cash expenditure. On the other hand, equipment loan
payments--both principal and interest--are included, because they are
actual payments made.

The spreadsheet allows the farmer to plan production enterprise-by-
enterprise. Sensitivity to price variability, changes in input levels
with associated yield changes based on farmer experience or experiment
station input-output results and other "what-if" situations may be
tested with near instantaneous results due to the recalculation ability
of electronic spreadsheets. A vast number of "partial budgets" may be












calculated very quickly, with the effect of changes reflected in the
budget summary and the cash flow projection.

As the farm production plan is implemented, the budget may be
updated with actual expenditures replacing pre-season anticipated
costs. By the end of the season, the budget--representing actual costs
and returns--becomes a cost accounting tool summarizing production which
should mirror aggregate records of expenses.





ADDITIONAL NOTES ON VISICALC

Specific formulas for the calculations performed by the spreadsheet
appear in the Edit area of the screen. Formulas for a coordinate repre-
senting each column x row position may be edited or changed using the
Edit command (/E) or by entering a new formula entirely.

The program as it appears originally on the disk is set for Auto-
matic Recalculation. Each time new data are entered, the entire sheet
is recalculated. It is astounding how impatient a user can get waiting
30-40 seconds after each keystroke, even though manual recalculation
with a pencil, an accountant's pad, and a calculator would take several
hours. Try the manual recalculation mode (type /GRM). After all data
are entered, then recalculate a single time, by typing (upper case 1
on TRS-80 Model III). Things may move along quite a bit more briskly
that way.

The window (/W) and title (/T) commands, with their extremely
flexible variants, are some of the most powerful features of electronic
spreadsheets. For example, you may split the screen to change an input
price or quantity and instantly observe the impact of the change on the
net revenue, the "bottom line", of an enterprise budget. Titles may
keep you from getting lost in a large jumble of numbers such as the Cash
Flow table in PLANFARM.

Often numbers which are generated or calculated can be overridden
with input by you. Be aware, however, when a formula is replaced by
direct user input, you can't revert back to the original formula. You
must retype the formula by hand or go back to a version on the disk
which still has the formula.

The user is encouraged to create working files frequently, and to
keep an up-to-date backup disk. You may want to keep copies of data
which might have historic or management value.








7












RUNNING THE EXAMPLE


Throughout the example in this manual, information which is sup-
plied by the user, at least the first time, is shown in standard type-
writer type. Information which is calculated by the program as a result
of input from you is shown in the distinctive dot-matrix printer type.
Results which you re-enter from a previously calculated result in
another part of the sheets are shown in boxes with computer scanner
type.

Throughout this guide, data entries or commands are given. The
user types in the information, then presses (ENTER). In some--but not
all--cases, you may use one of the directional cursor arrows,b*,, 4, ,
instead of (ENTER).

Each table heading includes a "code" for printing. Top left and
bottom right coordinates allow you to set the printer for making copies
of each table.

To demonstrate the use of the Farm Financial Planning System, a
"typical" farm is imagined and it is "modeled" with examples. Suppose
we have a 640 acre farm which has been in business for some years, with
many investments in land, equipment, facilities and breeding stock
already invested in the operation. The farm is operated by the owner
with one full-time salaried employee. Occasional labor is hired for an
hourly wage. The farm has 250 acres suitable for row crops under pivot
irrigation, 145 other available row crop acres, 175 acres of permanent
pasture, and 70 acres occupied by the farmstead, barns, roadways, fence
lines, woodlots, or other land which does not directly produce income.
The farm runs a 100 cow herd as a cow-calf operation with an 88% weaning
rate. Input levels are based on published extension budgets from North
Florida and South Georgia (5,6,12). Prices were current in fall, 1983,
and spring, 1984. Be aware that the budgets here are for example
purposes. They may not be appropriate for you to use "as is."




STEPONE

Ready? Let's move to the procedures in STEPONE. Boot up VisiCalc,
and load by typing /SL STEPONE.

TABLE 1: Calculate an Annual Fixed Cost of Land

Each block of land purchased is listed in Table 1 together with
the acres in the block and the original purchase price per
acre. Use the book value of land, regardless of when the pur-
chase was made. The sheet tallies acres, and sums the total
purchase price. Land in "non-productive" use is subtracted, for
























TABLE 1


CALCULATE AN ANNUAL FIXED COST FOR LAND

Total Price Total
Land Block Acrea /Acre Price
------------------------------------------------------
1 Back 40 49 225 11025
2 Smythe 235 370 86950
3 Cowpen 86 285 24510
4 Old Home 115 125 14375
5 NewGround 155 540 83700
6 0
7 0
8 0
------------------autza=s---------------------
TOTAL 640 220560
Acres in Farmatead, Barns, Roads, Waste ===> 70
Net Acres (Land for Crop and Livestock Pdtn> 570
Interest Rate on Long Term Investments ==> X 12
Appraisal/Acre ==> 225 Millage Rate => 14.5
Approximate Land Tax Amount ==ww==)======> $ 2088
ESTIMATED ANNUAL FIXED LAND COST ==n=====> S 28555











Net Acres. You enter, as a percent, the interest rate you face
on long term investments. Then give the locally appropriate
property appraisal for agricultural land, and the millage rate
for ad valorem (real property) taxes. Property tax and annual
land costs are calculated from these values. The annual cost of
land is tax plus the product of total purchase price times the
interest rate.

TABLE 2: Calculate the Fixed Cost of Owning Farm Equipment and
Estimate Hourly Operating Costs

First, enter the interest rate you face on long term invest-
ments--the same as you used above in the land cost calcula-
tions. Enter also the fuel cost per gallon. In this section
group all tractors, equipment, and facilities by type. On
motorized and self-propelled equipment, give rated PTO horse-
power. Estimate the years of useful life for the item. This is
not necessarily the tax or ACRS life, but a realistic life in
years before wearout or unsupportable loss of reliability. Then
enter the original purchase price (list price) of the item. For
equipment the routine automatically calculates a Straight Line
Depreciation with an assumed 10% salvage (junk or trade-in)
value. Interest on the average investment (purchase price plus
salvage value divided by 2) and 3/4 of 1% of original purchase
price to cover tax and insurance are calculated. They are added
to depreciation for an annual fixed cost for each item.

Building and facility fixed costs are the sum of Straight Line
Depreciation (no salvage value) and interest on the original
purchase price.

Fixed costs for the two classes of items--equipment and facili-
ties--are summed. You'll note a formula in the Edit area using
the @IF command in the column for FIXED COST. This corresponds
to a BASIC If-Then-Else statement which prevents the program
from attempting the mathematical impossibility of dividing by
zero (0). You get an ERROR statement if you try it.

Variable Costs as defined here are the cost of fuel and lubri-
cants and the average hourly cost of maintenance and repair.
They do not include the driver or operator. Fuel consumption is
based on rated horsepower at .05 gal/hp/hour. It is assumed
that 15i in lubricants will be used for every $1.00 of fuel
used. Repair and maintenance depend on the type equipment, and
are a percentage of original purchase price, using ASAE values
(1).

After all farm equipment is inventoried, the sheet counts the
number of tractors and the number of implements. You get an
average cost per hour of use for tractors and implements to use
in enterprise budgets later.






TABLE 2

CALCULATE THE FIXED COST OF OWNING FARM EQUIPMENT AND
ESTIMATE HOURLY OPERATING COSTS

INTEREST RATE ==> 12 x EQUIPMENT REPAIR CODES:
FUEL COST $/GAL => 1.099 Tractors .0001
Combines .0003
Others .0007
- - - - - - - - - - - - - - - - - - -


RATED YEARS PURCHASE FIXED
ITEM PTO HP LIFE PRICE COST
----------+----------------+-------- --------
TRACTORS AND SELF-PROPELLED EQUIPMENT
Tractor 135 9 37250 6460
Tractor 80 12 17000 2523
Tractor 75 12 12800 1900
0


IMPLEMENTS
Plow
Planter
Disc
Grn Drill
Grn Wagon
Grn Wagon
Sprayer
Rip/Beddr
Cultivatr
Grn Auger


AND PULLED


EQUIPMENT
12
10
12
10
12
12
8
10
10
8


4100
7800
6550
7200
2500
2500
1850
4100
4000
2850


COMBINES AND OTHER HARVEST EQUIPMENT


10 58500


IRRIGATION PUMPS AND MOTORS
Pump/Engi 25 12

OTHER INVESTMENTS: BUILDINGS,
Pole Barn 25
10M buBin 15
Well 20
Lo-Pres Pivot 250A 20
Hoselrrig 10
Fence 3.75 mi@1300 12
Pens, Working Area 15
5 Bulls 0850 6
100 Cows 6350 6


SUB-TOTAL
SUB-TOTAL


19500

FACILITIES,
8750
11500
5800
62000
23000
4875
14000
4250
35000


(Equipment)
(Facilities)


COST/
HOUR


12.26
6.76
6.02
0.00


609 2.87
1275 5.46
972 4.59
1177 5.04
371 1.75
371 1.75
344 1.30
670 2.87
654 2.80
530 2.00
0 0.00
0 0.00

9561 27.03
0 0.00


288


ETC
875
1457
638
6820
3680
699
1773
963
7933


0
30311
24838


)4 3.53
0 0.00


-----------------------------------====== ---------
TOTAL $ 55150
Number of Tractors ==> 3
Number of Implementa ==> 10
*-* Average Coat of Operating Tractors/Hr. 8.34
'*- Average Coat of Operating Implements/Hr. 3.04

-----------ssssa =----------ssssssc=s


Combine












REFERENCE TABLE: Equipment Information

Filed on the disk as a separate template is a reference table,
EQUIPFAX. It may be useful to refer to this table for data on
equipment usage which may be useful in preparing STEPONE, as
well as templates which come later (1,7,9).

TABLE 3: Fixed Cost of General Farm Overhead

Some costs of operating a farm cannot be assigned easily to any
particular crop or livestock enterprise. These are allocated as
a general cost proportionate to land use. Family living
expenses; salaried labor; utilities; accounting, bookkeeping, or
legal fees; and others are accounted for here. You may enter
monthly costs and have the spreadsheet assign an annual cost for
recurring periodic expenses, or you may enter an annual total.

TABLE 4: Summary of Fixed Costs

The costs calculated in STEPONE are summarized in this table.
In addition, any other cost to be charged against the entire
farm may be inserted. For instance, the farmer as manager
charges a Management Fee of $7500 per year for his own ser-
vices--above and beyond monthly family living expense. An entry
called MANAGEMENT could be entered into the table with the $7500
fee. The sum represents total fixed costs, either in actual
dollars or in foregone opportunities for capital tied up and
therefore not available to produce an income in some other
use. Consider total fixed cost as the cost of being able to
decide whether or not to commit variable costs to production--
the ante you pay to enter the game of a farming business. These
occur whether you produce or not.

In certain instances, it may make more sense to assign
fixed costs to a single enterprise rather than pro-rated over
all enterprises. Here, it would be reasonable to charge all the
fixed cost of the pivot irrigation system only to irrigated
acres under it, or to charge off the fixed costs of livestock
and cowpens just to livestock enterprises. However, in a "gen-
eralized" budgeting format such as this system, it is impracti-
cal to be that rigidly specific. Fixed Costs are more simply
allocated or charged off to each net acre. Total farm fixed
costs of $118,241.00 are allocated at $207.44 per acre to each
of the 570 productive acres. At this point summary data may be
jotted down or routed to the printer using /PP for use later.
Clear the screen (type /CY) and load CROPBUD (/SL CROPBUD).










REFERENCE TABLE


** EQUIPMENT INFORMATION **

Expected Hourly 1983
Equipment Hours of Typical Typical Repair- STEPONE N. Fla.
Item or Service Speed of Field Maint. Repair Custom
Operation Life Operat'n Effic'y Cost uw Code Rates
------------------------- -----------------------------------------
(hours) (mph) (%) (5/1000) (S/hr)
Wheel Tractor 12000 ---- ---- 0.12 .0001


Tillage & Cultivation
Moldboard Plow
Disc Harrow
Rotary Hoe
Cultivator
Planting
Planter
Grain Drill
Harvesting
Rotary Mower
Hay Rake
Baler
Forage Chopper
Combine
Cotton Picker
Miscellaneous
Sprayer
Fert. Spreader

** Repair and mail


2000
2000
2000
2000


3.0-6.0
3.5-6.5
5.6-11.0
1.5-4.0


70-90
70-90
70-90
70-90


1200 3.0-6.0 50-85
1000 2.5-6.0 65-85


1000
1500
2000
1500
2000
2500


2.0-5.5
4.0-6.0
2.5-5.0
1.5-4.0
2.0-3.5
1.5-3.0


88-90
85-90
70-90
50-75
65-80
60-75


1000 3.0-6.0 60-75
1000 3.0-6.0 60-75


0.70
0.65
0.60
0.60

0.70
0.80

1.20
0.70
0.22
0.29
0.27
0.26

0.78
0.93


.0007


.0007


.0003


.0007


ntenance is $/hour per $1000 of original


purchase (list) price.


** Acres Accomplished In a Typical Workday **
==0=~=================3====== ======
Equipment Hours of Actual Equipment Use in a Workday
Hours/Ac 1 6 8 10 12


0.05
0.10
0.15
0.20
0.25
0.30
0.40
0.50
0.75


160
80
53
40
32
27
20
16
11


200
100
67
50
40
33
25
20
13


240
120
80
60
48
40
30
24
16


9.00
5.75
5.00
5.00

6.25
5.75

6.50
4.25


22.50


5.25









TABLE 3


CALCULATE THE FIXED COST OF GENERAL FARM OVERHEAD
---------------------------
Quantity Cost Total Total
Item unitt) /Unit /Month /Year
-7------------ ------------'------- -----------
Full Time Labor 1 800 800 9600
Household Living 875 10500
Vehicles (mi,L/mi) 1100 .17 187 2244
Insurance
Utilities 85 1020
Telephone 31 372
Advertising 250
Entertainment 25 300
Dues & Memberships 225
Professional Fees 1650



ESTIMATED ANNUAL FARM OVERHEAD COST ======> S 27036










TABLE 4


SUMMARY OF FIXED COSTS

/NET
TOTAL ACRE
LAND ................ So 28555 50.10
EQUIPMENT ........... So 30311 53.18
FACILITIES .......... S$ 24838 43.58
GENERAL OVERHEAD .... SS 27036 47.43
MANAGEMENT .......... s$ 7500 13.16

TOTAL $$S 118241 207.44











CROPBUD


TABLE 5: Enterprise Budget for Crop Production

You fill in a few items of information: the crop, acres of the
crop in production, total net acres on the farm (from Table 1,
STEPONE), expected yield, and the unit measure of yield (i.e.,
bushels, hampers, hundredweights, tons).

BUDAID

Here we'll step aside to do some necessary calculations. Tables
6A and 6B may be used or may be left aside. Both are calcula-
tion aids in preparing budgets, and they are stored on the disk
in such a manner that they can be called forward as necessary
without clearing the main budget. This procedure, combining two
distinct spreadsheets, allows for greater computer efficiency,
and less time in performing recalculations. If you want to use
the aids, do not type in /CY, but type /SL BUDAID. The program
BUDAID is added to the right-hand margin of the crop or live-
stock budget you are working on. You will need to move over to
position Jl on the screen.

Table 6A calculates the hours of tractor and equipment use per
acre. For each crop or pasture enterprise, you may calculate
the total hours of tractor and equipment usage. Enter the
number of times each operation is performed, the tractor speed
in miles per hour and the swath width of the implement in
feet. Then give field efficiencies of the operations as a per-
cent. Refer to the equipment information stored as the sheet,
EQUIPFAX. The combined hours per acre will be used in CROPBUD
and LVSTKBUD. As a check on the accuracy of the formula used to
estimate hours per acre, you are given a table on EQUIPFAX with
the number of acres which may be accomplished in a typical
workday of 6-12 hours.

Table 6B calculates the cost of seedbeds for crops such as
tobacco or vegetables requiring transplanting. A tobacco plant
bed of 100 yards could be budgeted, and the total variable cost
entered in CROPBUD for Seed. Cost per seedling (cents) may be
determined. Likewise, establishment cost for pasture or other
perennial crops could be calculated in this mini-budget. In
some cases, you may wish to "amortize" an establishment cost
over a number of years. You enter expected life in years, and
the system pro-rates the total cost over the years using the
amortization formula. Interest is subtracted automatically to
prevent double counting.












Results from Tables 6A and 6B must be manually keyed into the
appropriate spot in CROPBUD or LVSTKBUD. With this aside taken
care of, let's return to the main crop budget, Table 5.

Now you enter inputs you plan to commit to production such as
seed, fertilizer, pesticides, labor, equipment, etc. In Column
C, list the unit of measure. Then in Column D, enter the number
of units, and in E, the cost per unit. Seed, for example, is
measured in pounds. In this irrigated corn example 14 pounds
are planted at $1.00 per pound. Of course, it could be entered
just as well as .25 bushels at $56/bushel. Move the cursor over
to Column H and indicate the approximate month in which the cash
expenditure will be made. When recalculation is performed, the
budget format will automatically calculate the per acre cost and
the cost for the entire acreage of the enterprise. Continue in
this manner, entering amounts and prices for each of the various
inputs.

Notice that here we use the tractor and equipment hours per acre
which we calculated in Table 6A and the prices per unit which
were determined at the end of Table 2 (STEPONE). Also, note
that the tractor seems to be driving itself--tractor hours
exceed labor hours. Remember, we are using the manager's and
the full-time salaried laborer's efforts. We'll pay them later
as a fixed cost; right now, the 20 minutes or so per acre are
for an occasional hired hand.

The next entry to make is the interest rate on short term or
operating loans, as a percent, not a decimal. You have already
used an interest rate on long term investments; this rate may or
may not be the same. Enter also the average number of months
your working capital will be tied up in the crop. Now reach way
back to that summary of fixed costs (Table 4, STEPONE). Put in
the total farm fixed cost of $118,241. The spreadsheet allo-
cates a portion to this enterprise equal to the proportion of
its land use to net usable land, 250 acres of corn from the 570
acre total. If you wish to allocate fixed cost on some basis
other than pro-rating on acres, enter the amount per acre in
Coordinate F56, overriding the calculated amount.

Finally, enter the market price per unit, such as $/bu, for the
yield you expect. Recalculate if you are in the manual mode and
the enterprise budget is done.

Variable cost per unit of yield is a break-even market price on
variable cost alone, and must be covered to justify produc-
tion. The bottom line, quite literally, is the break-even price
over all costs, Coordinate F71. This must be covered over the
long haul if the farm is to remain viable over time.






TABLE 5

ENTERPRISE BUDGET FOR CROP PRODUCTION

Acres--> 250 Total acres--> 570 CASH
Crop---> Corn Yield---> 135 Bushels FLOW
==-=--=-=====-====r==t=It=====0=== =
QUANTITY PRICE TOTAL S TOTAL 9 MONTH
per per per 250 COST
ITEM UNITS ACRE UNIT ACRE ACRES INCURRED
--------------------.------.--------.--------+--------------- -- ------


VARIABLE COSTS
Seed lb
Seed Treatment lb
Lime ton
Fertilizer
complete cwt
nitrogen lb
Neaaticide lb
Herbicide
preeaergence apple
postenergence appl
Insecticide appl
Custom Hire apple
Custom Hire acre
Other ---
Other ---
Tractor hour
Equipment hour
Labor hour
Irrigation acre in
Harvest
machinery hour
labor hour
other ----
custom hire acre
marketing cost yield
Cash Rent acre
Interest mo,x
TOTAL VARIABLE COST
harvest coat/unit yield
total variable cost/unit yield


14


.33

4.5
175


1.00 14.00
0.00
18.50 6.11

7.55 33.98
0.27 47.25
0.00


1 13.00 13.00
1 10.00, 10.00
2 0.89 10.68
0.00
1 3.50 3.50
0.00
0.00
5 8.34 12.51
5 3.04 4.56
5 4.10 1.03
5 6.50 32.50


.6 27.03 16.22
.6 4.10 2.46
0.00
0.00
135 0.04 5.40
0.00
6 13.00 13.86
227.04
0.18
1.68


(JAN-DEC)
3500 JAN
0
1526 OCT-NOV

8494 FEB
11813 APR
0

3250 JAN
2500 MAR
2670 JAN
0
875 APR
0
0
3128 JAN-SEP
1140 JAN-SEP
256 JAN-SEP
8125 JUN

4055 AUG-SEP
615 AUG-SEP
0 AUG-SEP
0 AUG-SEP
1350 AUG-SEP
0 JAN
3464 NONCASH
56760


1


1.
1.
.2


--------- -----------------------. -----------------------
TOTAL FIXED COST I 118241 207.44 51860
total fixed cost/unit yield 1.54
-- -- -- -- -- -- -- -- -- -- -- -- -- -- --+-------------------
TOTAL COST (Variable + Fixed) 434.48 108620
total coat/unit yield 3.22
--------------- 7------------------------------------------
REVENUE
Crop Sale bu 135 3.25 438.75 109688 AUG-SEP
Other ---- 0.00 0
TOTAL 438.75 109688
-- -- -- -- -- ---- -- -- -- -- -- -- -- --.---------------------
NET REVENUE
Over Variable Cost 211.71 52928
Over Total Cost 4.27 1067
Break-Even Yield for Given Price 133.69
Break-Even Price for Given Yield 3.22
--sss=s=====f===========s=a-=s===s-as==s=-====s===================ss









TABLE 6A


*" BUDGET CALCULATION AIDS **

CALCULATE HOURS OF TRACTOR AND EQUIPMENT USE PER ACRE
===-===-- a ===~=s=ss 7===ssE3=asEB B =BxB
Times Swath Field Total
Operation Over Speed Width Effic'y Hours
----------_---------+ -------------- ------------------
(x) (aph) (ft) (X) (/ac)
Plow 1 3 10 85 0.32
Disk 2 4 12 90 0.38
Plant 1 3.5 12 70 0.28
Cultivate 2 4.5 12 85 0.36
Spray 2 6 24 75 0.15
0.00
0.00

Total Hours of Equipment Use per Acre 1.50


TABLE 6B


CALCULATE COST OF TRANSPLANT BEDS OR ESTABLISHMENT

PRICE
ITEM UNITS QUANTITY /UNIT TOTAL


---------------------+-----+---------


Seed
Fertilizer
complete
nitrogen
Nematicide
Insecticide
Other
Tractor
Equipment
Labor
Other
Interest


oz 1.5


cwt
Ib

Ib

hour
hour
hour

o,.x


---------+----


3.50 5.25


1.5 8.25 12.38
20 0.27 5.40
0.00
.5 3.25 1.63
0.00
.2 8.34 1.67
.2 3.04 0.61
4 4.10 16.40
0.00
4 13 1.88
======Z===


Total.Variable Cost of Seedbed or Establishmt
Number of plants or seedlings ==> 0
Average cost of plants or seedlings (cents)


45.20

NA


If this is an establishment cost for a perennial crop
such as pasture or tree crops, you may wish to amor-
tize the cost over the life of the crop.

Years of expected life ===> 1 years
Establishment cost ===> 43.33 (net of interest)
Annual Interest rate ===> 13 x
Amortized Cost (pro-rated cost/year) S 48.96
= -


----












You have a budget for the crop. Let's look at the crop from a
few different perspectives.

TABLE 7: Monthly Cash Flow for the Enterprise

You need to do some arithmetic here to make up for some minor
deficiencies of the VisiCalc spreadsheet. Some other spread-
sheets may be able to perform this task automatically.

Scan Column H. For months noted in Column H, there are costs
listed in Column G. For all variable costs in Column G, except
interest, allocate costs to the month in which they are
incurred. Costs which are incurred over several months are
allocated proportionately. In this example, they are entered as
averages. You can add them up and enter the totals as a
specific number, but you will have to recalculate each time a
"what-if" change is made. The other alternative is to enter a
formula that will automatically calculate your costs. In this
example, cost of seed (G25), pre-emergence herbicide (G33), and
insecticide-nematicide applied at planting time (G35), are
expended in January. Since corn is produced over a nine month
period, we will simplify the month assignment of costs by nine
equal portions, one for each month. One-ninth (1/9) of the
costs of tractors, equipment, and labor (G40, G41, & G42) are
incurred in January. Thus, the formula for January's costs is
+G25+G33+G35+(G40+G41+G42/9). Enter this formula in Coordinate
B78 in the Edit screen. This procedure for calculating costs is
repeated for each month using the appropriate variables.
Interest is not assigned since it is a variable--but not
necessarily a cash cost. Only cash expenditures are summarized
in Table 7. We'll return to Cashflow analysis in Table 12,
later.

On larger capacity spreadsheets, you could add 12 columns along-
side the enterprise budget to allocate the cost of each input by
month. The sum of each column would transfer to this table.
Likewise, physical units of inputs--hours of labor or tractor
use, pounds of fertilizer, acre-inches of irrigation--may be
assigned to monthly columns to identify peak or slack seasons or
for more sophisticated planning techniques such as linear pro-
gramming.

TABLE 8: Risk Analysis for Price and Yield Variability

If you expect a particular yield, you know there is a fair
chance of harvesting a higher or lower yield. If you expect to
sell the product at a particular market price, there is a fair
chance of either a higher or lower price. This table uses the
decision-tree method of calculating the effect of variability in
yield and price on net revenue. Enter the high and low yields








TABLE 7

** ANALYSIS OF RETURNS **

MONTHLY TOTALS FOR CASH OUTFLOWS

January 9923 July 503
February 8996 August 3512
March 3003 September 3512
April 13190 October 763
May 503 November 763
June 8628 December 0
YEAR TOTAL ....... 53296









TABLE 8


RISK ANALYSIS FOR PRICE AND YIELD VARIABILITY

Expected Yield ==> 135
Expected Price =>S 3.25
16Q <= Highest Probable Yield
15 <= X Probability of High Yield
85 <= Lowest Probable Yield
20 <= X Probability of Low Yield

3.75 <= Highest Probable Price
30 <= X Probability of High Price
2.90 <= Lowest Probable Price
20 <= Probability of Low Price

YIELD PRICE S0 NET
LEVEL LEVEL LIKELIHOOD REVENUE
----------+----------+--------------------------------
85 2.90 4 X for a return of -179.06
3.25 10 x for a return of -149.31
3.75 6 X for a return of -106.81
135 2.90 13 % for a return of -42.98
3.25 33 x for a return of 4.27
3.75 20 X for a return of 71.77
160 2.90 5 x for a return of 25.06
3.25 8 X for a return of 81.06
3.75 5 % for a return of 161.06

Net Revenue per acre (long range probability) -4.25
Compare this to Net Revenue in previous page 4.27

===S=S=S==SB XX5axS ==5==












you think could realistically occur and assign a "probability"
for each outcome. Think of the percent probability as the
number of chances per hundred years or hundred rolls of the
dice. The routine calculates the chances of your given expected
yield.

Once you have given the numbers, what does the table mean? The
array of likelihoodd" gives the distribution of net returns you
may expect, if your guesses about an unknown future are accu-
rate. In the irrigated corn example, you stand a 33% chance
(one year in three) of losing money. What's more, 20% of the
time the level of loss is somewhere in the large-to-whopping-big
range. On the other hand, there is a 2 to 1 chance to show
profit, but not profits in the same magnitude as the losses. A
farmer with a heavy debt load or with financial insecurity may
compare the Risk Analysis of several crops and plant the one
which shows the least likelihood of big losses. He probably
would avoid a chance for a big profit if it could be achieved
only at risk of losing the farm. In a word, this analysis gives
you a chance to ask yourself about management strategies: Are
you a "high roller" or are you in a position to need to play
safe?

Net revenue from the single expected yield and price in the
budget (Coordinate F115) is compared to a weighted, or a proba-
bilistically distributed, revenue (Coordinate 114).

TABLE 9: Break-Even Analysis

The Risk Analysis looked at a range of outcomes for a single
crop. To make a wise selection of enterprises, you must also
compare profitability among enterprises. Select an alternative
crop, such as soybeans used here, and give a reasonable yield
and variable cost of production per acre. The table tells you
what market price would be necessary from the alternative crop
under your price, cost, and yield conditions to generate exactly
the same profit per acre. At that point you would be indiffer-
ent (at the market end) as to which crop you should produce.
You see here that 35 bushel soybeans would have to bring
$10.76/bushel to break-even with 135 bushel corn at a $3.25
market. Both $3.25 corn and $10.76 soybeans would return $4.27
net revenue per acre.



























TABLE 9


BREAK-EVEN ANALYSIS OF TWO CROP RETURNS
==== ========S---==========-===-=-===S= =
Compare the "profitability" of this crop to an alter-
native crop:
SOYBEAN<== Crop
35 <== Yield per Acre
165 <== Variable Cost per Acre

*Price for Budgeted Crop*
2.90 3.25 3.75
------------*-----+-------+--------+--------------
Yield of 85 :: 5.27 6.12 7.33
Budgeted 135 :: 9.41 10.76 12.69
Crop 160 :: 11.48 13.08 15.37

Price is that price per unit yield necessary to
break even with the budgeted crop at various yields
and prices.












LVSTKBUD


TABLE 10: Livestock Enterprise Budget

The system is the same for LVSTKBUD as for CROPBUD, but some
formatting changes are evident. Costs for pasture production
are entered on a per acre basis, just as the previous corn
budget. You could actually set up pastures, hay or silage as a
crop enterprise and "sell" the yield in grazed acres or tons of
forage at a break-even price to the livestock enterprise. Or,
you may merge BUDAID and LVSTKBUD to calculate pasture costs.
Either way the per acre pasture cost is then assigned as a cost
to the whole herd.

We have charged the herd with 175 acres of land use in permanent
pasture. The 15 acres more in pens, working areas and lanes are
included in the "non-productive" acres--70 of the 640.

The small grain, double cropped behind soybeans, is not charged
against the cow/calf enterprise when we allocate fixed costs.
We'll say soybeans must shoulder that burden and thus subsidize
the cow operation. No matter, cattle does not even cover the
variable costs, and that's with an 88% weaned calf crop! Again,
we have brought forward the fixed cost (from STEPONE, remember)
and pro-rated a 175 acre share out of 750 acres (31%) to the
cow/calf operation.

For revenue, we have culled cows and a few open first-year
heifers. We disposed of an old bull, as well as selling steer
and heifer calves. Disposal of breeding stock is merely a
source of revenue in the enterprise budget. Remember, there are
substantial tax advantages in claiming capital gains on the sale
of breeding stock.

The table titled Monthly Total for Cash Outflows accompanies the
Livestock Budget just as it does the Crop Budget. With an
extremely wide range of possible combinations of sale classes,
weights, and differentiated market prices, the risk analysis
becomes cumbersome. Weighted average market prices could be
used, just as bushels and price per bushel were used to look at
corn, but the weighting process would render the analysis non-
sense. Alternatively, to consider a range of different out-
comes, step through the budget several times, recalculating with
the change in yields and each altered set of prices. Perform
the comparisons by "trial and error."







TABLE 10

ENTERPRISE BUDGET FOR LIVESTOCK PRODUCTION

Herd---> Cow-calf CASH
Acres--> 175 Total acres--> 57 FLOW

PRICE TOTAL S TOTAL S MONTH
per per per COST
ITEM UNITS QUANTITY UNIT ACRE HERD INCURRED
--------------------------+--------+---------------------- -------


VARIABLE COSTS (/acre)
Permanent Pasture ACRES 175
ProRated Estb Cost yrs 10
Lime ton .2
Complete Fertilize cwt 3
Nitrogen Ib 75
Herbicide gal .25
Insecticide apple 1
Tractor hour .25
Equipment hour .25
Labor hour .2
Cash Rent acre
Temporary Pasture ACRES 35
from BUDAID acre 1
Livestock Herd
Purchased Hay ton 45
Protein Supplement ton 18
Grain Supplement ton 15
Salt Ib 1880
Minerals lb 3500
Medication herd 1
Vet. Services herd 1
Tractor & Equip hour 145
Labor hour 75
Marketing ----
moving & hauling head 88
marketing coat head 88
Other herd
Interest mo,X 9
SUB-TOTAL (pasture variable cost)
TOTAL VARIABLE COST
TOTAL FIXED COST I112 l

TOTAL COST (Variable + Fixed)


(JAN-DEC)


82.00
18.50
7.64
0.27
11.50
3.75
8.34
3.04
4.10


8.20
3.70
22.92
20.25
2.88
3.75
2.09
0.76
0.82
0.00


53.50 53.50

62.50
175.00
148.00
0.04
0.12
325.00
250.00
11.38
4.10

0.25
0.50

13


31X


1435
648
4011
3544
503
656
365
133
144
0


NONCASH
OCT
APR
JUN
JUN
AUG
MAR-OCT
MAR-OCT
MAR-OCT


1873 SEP-MAY


2813
3150
2220
75
420
325
250
1650
308
0
22
44
0
2397
13311
26984
36302


NOV-FEB
OCT-MAR
JAN-DEC
JAN-DEC
JAN-DEC
JAN-DEC
JAN-DEC
JAN-DEC
JAN-DEC
NOV-DEC
NOV-DEC
NOV-DEC

NONCASH


63286


REVENUE (number)(ave Ibs) ($/lb) (totalS)
Steers Barrows 44 475 0.56 11704 NOV-DEC
Heifers Gilts 19 435 0.47 3885 NOV-DEC
Cull Heifers-Gilts 9 725 0.42 2741 CAP GAIN
Cows Sows 16 950 0.36 5472 CAP GAIN
Bulls Boars 1 1350 0.43 581 CAP GAIN
Other 0
TOTAL 24382
-- -- -- -- -- -- -- ---- -- --- -- -- -- -- -- -- ---------
NET REVENUE
Over Variable Cost -2602
Over Total Cost -38905
Var Cost/Pound Marketed ( 52240 Ib) 0.52
Total Cost Per Pound Marketed 1.21

24











PIANFARM


You may construct as many crop and livestock enterprise budgets
as you have the patience to generate. If you wish to save file
copies, make certain you assign unique names to the files. Then
clear the budgets, and fetch the last puzzle piece, PLANFARM.

TABLE 11: Summarize Information from Budgets

Bring forward acres, yield, market price and variable cost from
each of the individual crop budgets. Enter numbers, weights,
prices of livestock and variable cost from livestock budgets. A
total enterprise variable cost rather than per acre cost is used
for livestock. In this case, the entire cost is assigned to
steer calves. The routine calculates total costs and returns
for each enterprise as- well as aggregate crop and livestock
totals. Bring Fixed Costs up again from STEPONE and the cal-
culation of a Farm Bottom Line results.

TABLE 12: Cashflow Analysis for the Entire Farm

Now look from the perspective of cashflows. You have a table
(Table 7 with CROPBUD) accompanying each enterprise budget which
assigns variable costs excluding interest to the approximate
months in which they occur. Transfer those data one enterprise
at a time. Months are numbered 1-12, not named, so you may set
up any fiscal year. The example here shows a fiscal year corre-
sponding to a January-December calendar year. Enter the value
of crop or livestock sales for each enterprise in the month the
sale is made. Use harvest month unless advance cash receipts
occur on forward contracts or unless the product is stored. You
may enter offsetting futures transactions on commodity contracts
by the month of their occurrence.

Next, enter the other income you anticipate in the month you
expect receipts. Following that, enter other expenditures.
When recalculation occurs, Revenues and Costs are summarized.
You may have a cash balance carried over from the previous year,
which is entered at Coordinate D95. The row labeled Cumulative
gives an accumulated or running cash balance. Payments on
outstanding loans--principal and interest--are entered. The
cashflow statement shows points during the year when there may
be operating deficits, necessitating short run loans. Loans are
timed according to cashflow deficits, on row 98. Repayment of
principal and interest are scheduled during periods of accumu-
lated positive cash flow. A cumulative after-loan row (Row 104)
shows a new cash balance. Any positive net revenue is available
for additional debt service, or maybe a family vacation, sav-
ings, or a new pickup truck.






25














TABLE 11


SUMMARIZE INFORMATION FROM ENTERPRISE BUDGETS
==============EESEESEEESESS~ma=WESESEE=C====SSWESSE=3C:E==SECES=S===C3==

PRICE V.COST TOTAL TOTAL NET
CROP ACRES YIELD /UNIT /ACRE REVENUE V.COST RETURN
----------------------------- -----------------------------+-------
Corn 250 135 3.25 227 109688 56760 52928
Soybeana 100 35 7.45 144 26075 14400 11675
Wheat 65 42 3.40 121 9282 7865 1417
Rye/Ryegraas 35 0 0 0 0
Bahia 175 0 0 0 0
Watermelon 45 28500 .0325 595 41681 26775 14906
0 0 0
0 0 0
0 0 0
o o o
o o o


AVERAGE PRICE TOTAL TOTAL NET
LIVESTOCK HEAD WEIGHT /LB REVENUE V.COST RETURN
--------------------------- ---------- -----------------+-------+-------.
Steers 44 475 0.5b 11704 26984 -15280
Heifers 19 435 0.47 3885 3885
Cull Cows 16 950 0.36 5472 5472
Cull Replac Heif 9 725 0.42 2741 2741
Cull :Bull 1 1350 0.43 581 '581
0 0
0 0
0 0


FIXED TOTAL TOTAL -NET
SUMMARY OF INCOME COST REVENUE V.COST RETURN
-----------.---------------------------------------------------.-------
CROPS ................................ 186726 105800 80926
LIVESTOCK .............................. 24382 26984 -2602
OTHER FARM ............................. 0 0
FIXED COSTS LAND 28555
EQUIPMENT 30311
FACILITIES 24838
OVERHEAD 2703b
MANAGEMENT 7500
TOTAL ..................... $$$ 118240 211107 132784 -39917











CONCLUSION


The most attractive characteristics of VisiCalc and virtually all
the other electronic spreadsheets are flexibility, adaptability and
relative ease of use. The Farm Financial Planning System is a series of
templates which should be merely a beginning for you. Modify it, adapt
it, retool it, make it fit your circumstances. It may be used as a
model in which you substitute your own values. Create as many crop and
livestock budgets as you wish. Use the ones here as prototypes.

The authors have made every effort to assure that the microcomputer
programs and information in this publication are accurate and effec-
tive. The authors make no expressed or implied warranty that the pro-
grams or information in this publication will enable the user to achieve
any particular result.

The authors would appreciate comments on suitability, adaptations
and problems. Address comments to:

Farm Computer Support Group
c/o Dean John T. Woeste
Florida Cooperative Extension Service
1038 McCarty Hall
Institute of Food & Agricultural Sciences (IFAS)
University of Florida, Gainesville, FL 32611

Information on ordering diskette copies of the templates discussed
here may also be obtained by writing to the above address.









TABLE 12


CASH FLOW (SPLIT TABLE FOR 80 CHARACTER PRINTER)
==T====EM -ONT--- -;- -2-------4---5----
ITEM MONTHLY -1- -2- -3- -4- -5- -6- -7-
------------- -------------------------------------------- ---------------------


--- ENTERPRISE COSTS
CORN V. COST
SALES
SOYBEANS V. COST
SALES
WATERMLN V. COST
SALES
WHEAT V. COST
SALES
BEEF V. COST
SALES
V. COST
SALES
V. COST
SALES
--- OTHER INCOME --
CUSTOM WORK
GOV'T PAYM'TS
OFF-FARM INCOME
OTHER SOURCES
-CAPTL- LIVESTK
-SALES- EQUIPMENT
LAND
OTHER
--- OTHER EXPENSES -


& RETURNS ---------
r923 89%
9923 8996
0 0
0 0
0 0
15042 1960
0 0
194 1325
0 0
1873 1873
0 0
0 0
0 0
0 0
0 0
--------------------

0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
-------------------


3003
0
1 5402
0
30b0
0
1216
0
1251
0
0
0
0
0


0
0
0
0
r241 1
0
0
0


13190
0
467
0
1051
0
319
19282
4737
0
0
0
0
0


Li


503
0
2368
0
1501
0
0
0
726
0
0
o
0
0


8628 503
0 0
1351 1351
0 0
7861 4500
121681 20000
0 0
0 0
4564 517
0 0
o 0
0 0
0 0
0 0


0
0
0
0

0
0
0
0


MANAGEMENT FEE 25 625 625 625 625 625 625 625
FAMILY LIV'G EXP 875 875 875 875 875 875 875 875
FULL TIME LABOR 800 800 800 800 800 800 800 800
INS, UTIL, RENT 218 218 170 170 170 185 213
TAXES 0 0 0 0 0 0 0
CAPITAL EXPENDS 0 0 0 0 0 0 0
OTHER EXPENSES 3 389 389 389 389 389 389 389
OLD LOANS- PRIN 0 0 0 0 0 0 0
OLD LOANS- INTR 0 0 0 0 0 0 0

TOTAL REVENUE 0 0 2741 9282 0 22262 20000
TOTAL COSTS 19939 17061 16791 22623 7957 25278 9773
--- BAL BROUGHT FWD ---- 10500
NET RETURN -9439 -17061 -14050 -13341 -7957 -3016 10227
----------------------------------------------------------------------------
CUMMULATIVE -9439 -26500 -40550 -53891 -61848 -64864 -54637
--------------------------------------------------------------------------------
NEW BORROW 30000 0 12000 12000 10000 0 0
LOAN PAY PRIN 0 0 0 0 0 0 0
PAY INTR 0 0 0 0 0 0 0
CASH END OF PERIOD 20561 3500 1450 109 2152 ---------------------------------------------------------------------864 9363
CASH END OF PERIOD 20561 3500 1450 109 2152 -864 9363
sa==s='==s=3 ==t=s==aa=sa==3a aa=aa===









TABLE 12 (continued)


-8- -9- -10- -11- -12- TOTAL ITEM
+-------+-------+-------*-------+--------+-----------------------


P==


----------------------------------------------------
-13220 19755 22316 7555 9741 9741 CUMMULATIVE
-- ------------------------------------------------------------
0 0 0 0 0 64000 NEW BORROW
50000 14000 0 0 0 64000 LOAN PAY PRIN
750 4700 o o 0 5450 PAY INTR
----------------------------------------------------------------
30 14305 16866 2105 4291 4291 NEW CASH BALNCE



29


3512 3512 763 763 0 53296 CORN V. COST
49688 60000 0 0 0 109688 SALES
711 400 425 425 b | 13500 SOYBNS V. COST
0 0 18700 17375 0 26075 SALES
0 0 0 0 0 24975 WATRMLN V. COST
0 0 0 0 0 41681 SALES
0 0 194 3968 194 7410 WHEAT V. COST
0 0 0 0 0 9282 SALES
1174 726 1898 1906 1906 23151 BEEF V. COST
0 0 0 17795 774 15589 SALES
0 0 0 0 0 0 ---- V. COST
0 0 0 0 0 0 SALES
0 0 0 0 0 0 ---- V. COST
0 0 0 0 0 0 SALES
OTHER INCOME
0 0 0 0 0 0 CUSTOM
0 0 0 0 0 0 GOV PYMT
0 0 0 0 0 0 OFF-FARM
0 0 0 0 0 0 OTHER
0 5472 0 0 0 8794 CAPTL LIVESTK
0 0 0 0 0 0 SALES EQUIPMENT
0 0 0 0 0 0 LAND
0 0 0 0 0 0 OTHER
OTHER EXPENSES
625 625 625 625 625 7500 MANAGEMENT FEE
875 875 875 875 875 10500 FAMLY LIV'G EXP
800 800 800 800 800 9600 FULLTIME LABOR
185 170 170 180 218 2267 INS, UTIL, RENT
0 0 0 0 0 0 TAXES
0 0 0 0 0 0 CAPTL EXPENDS
389 389 389 389 390 4669 OTHER EXPENSE
0 0 0 20000 0 20000 EXIST LOAN PRIN
o 25000 o 10000 0 35000 EXIST LOAN INTR

49688 65472 8700 25170 7794 211109 TOTAL REVENUE
8271 32497 6139 39931 5608 211868 TOTAL COSTS
10500 PREV CASH BAL
41417 32975 2561 -14761 2186 9741 NET RETURN











REFERENCES


1. American Society of Agricultural Engineers. 1979. "Agricultural
Machinery Management Data." ASAE D230.3. Agricultural Engi-
neers Yearbook 1979-80 (26th Edition). St. Joseph, Michigan.
2. Brannstom, Arlin J. "Select An Electronic Spreadsheet." North
Central Computer Institute.
3. Fellows, Irving F. Editor. Budgeting: Tool of Research and Exten-
sion in Agricultural Economics. Storrs Agricultural Experiment
Station, University of Connecticut. Storrs, Connecticut.
Bulletin 357, April 1962.
4. Fylstra, Dan and Joyce Uggla. "VisiCalc\ TRS\ Model III User's
Guide." Personal Software Inc., Sunnydale, California. 1980.
5. Givan, William, Claude Dorminey, and George Westberry. "1984 Crop
Enterprise Analysis," Miscellaneous Publication #27-S. (Rev.
Oct. 1983). Cooperative Extension Service, University of
Georgia, College of Agriculture, Athens, October 1983.
6. Hewitt, Timothy D. "1984 Cost of Production Budgets for North
Florida." Extension Mimeograph, Food and Resource Economics
Department, University of Florida, Gainesville, December 1983.
7. Hewitt, Timothy D. and Marcus Eason. "1983 Farm Machinery Custom
Rates for North and West Florida." Food and Resource Economics
Department, FRE-44. IFAS, University of Florida, Gainesville,
October 1983.
8. Holt, John and Kim B. Anderson. "Teaching Decision Making Under
Risk and Uncertainty to Farmers." Agricultural Economics
Department. Paper A.E. 7704. Oklahoma State University, May
1977.
9. Hunt, Donnell. Farm Power and Machinery Management. 6th Edition.
Iowa State University Press, Ames, 1973.
10. Prevatt, J. W. Cash Flow Analysis: A Farm Management Technique.
Cooperative Extension Service. Circular 488, University of
Florida, Gainesville, May 1981.
11. Schn'eeberger, Kenneth C. and Odell L. Walker. "Farm Management--
Basic Economic Principles." Ag. Econ. Paper No. 6715. Oklahoma
State University, Stillwater. 1967.
12. Simpson, James R., F. S. Baker, Jr., and Mark Eason. "Evaluating
North Florida Cattle Raising Alternative." Circular 528,
Florida Cooperative Extension Service, IFAS, University of
Florida, Gainesville, June 1983.
13. Westberry, George 0. "Enterprise Budgets: What, How and Why?"
Food and Resource Economics Department, Staff Paper 131. Uni-
versity of Florida, Gainesville. August 1979.




























APPENDIX A

***1m11 mm~jm mmm@N**wm** * * **
FARM FINANCIAL PLANNING SYSTEM
Cooperative Extension Service
Institute of Food and Agricultural Sciences
University of Florida (UF)
Copyright 1984 by IFAS, UF



For further information contact the Farm Computer
Support Group, c/o Dean John T. Woeate, Florida Cooper-
ative Extension Service, 1038 McCarty Hall, University
of Florida, Gaineaville, FL., 32611.
Prepared by Lawrence A. Halsey, Jefferson County
Extension Director
and Tim Hewitt Area Farm Management Econo-
mist, AAC-Marianna
,*,mmmmmmmli**l,*m*mmmmm*mmmmm~,***mmmm,*















APPENDIX B


M*MMMM***N ififeaM***a***age ********fie*s***fa**f**e*
FARM FINANCIAL PLANNING SYSTEM
Cooperative Extension Service
Institute of Food and Agricultural Sciences (IFAS)
University of Florida (UF)
Copyright 1984 by IFAS, UF


Rif if if i*RifWW iiiiii ifffWWiWiiiWiWWiiffff iifffffi


STEPONE: TABLE DESCRIPTION
Land Cost
Equipment Fixed Cost
;General Overhead Cost
Total Fixed Cost Summary

EQUIPFAX:TABLE DESCRIPTION
Equipment Information
data on this table
will help complete
STEPONE & BUDAID
Acres Accomplished in a
Typical Workday


TOP LEFT
A14
A37
A103
A124


BOT.RIGHT
F35
F101
F122
F135


TOP LEFT BOT.RIGHT
A14 H46


F62


BUDAID: TABLE DESCRIPTION TOP LEFT BOT.RIGHT
Equipment Use per Acre J15 030
Partial Budget for Seedbeds J32 063
and Perennial Crop Estab-
lishment -- Amortization


CROPBUD:


TABLE DESCRIPTION TOP LEFT
Crop Enterprise Budget A14
Monthly Cash Flow Summary A75
Yield & Price Risk Analysis A86
Break-Even Analysis A117


BOT.RIGHT
H72
F84
F115
F135


LVSTKBUD:TABLE DESCRIPTION
Herd Enterprise Budget
Including Pasture
.Monthly Cash Flow Summary


PLANFARM: TABLE DESCRIPTION
Budget Summary
Cash Flow Analysis


TOP LEFT BOT.RIGHT
A14 H73


A75


TOP LEFT
A10
A53


F85
BOT.RIGHT
151
R105





,,031 EilCOLssg I


COOPERATIVE EXTENSION SERVICE, UNIVERSITY OF FLORIDA. INSTITUTE OF FOOD AND AGRICULTURAL
SCIENCES, K. R. Tefertlller, director, In cooperation with the United States Department of Agriculture, publishes this Infor-
mation to further the purpose of the May 8 and June 30, 1914 Acts of Congress; and is authorized to provide research, educa-
tional Information and other services only to Individuals and Institutions that function without regard to race, color, sex or
national origin. Single copies of Extension publications (excluding 4-H and Youth publications) are available free to Florida
residents from County Extension Offices. Information on bulk rates or copies for out-of-state purchasers is available from
C. M. Hinton, Publications Distribution Center, IFAS Building 664, University of Florida, Gainesville, Florida 32611. Before publicizing this
publication, editors should contact this address to determine availability.




University of Florida Home Page
© 2004 - 2010 University of Florida George A. Smathers Libraries.
All rights reserved.

Acceptable Use, Copyright, and Disclaimer Statement
Last updated October 10, 2010 - - mvs