Farm Financial Management Concepts

The video tutorial covers the importance of farm records, detailing types such as physical and financial records. It explains the reasons for keeping these records, including aiding in decision-making and obtaining loans. The tutorial also discusses variable and fixed costs, and key financial terms like gross income, gross margin, and net profit. Finally, it highlights the concepts of inputs and outputs in farming.

What is an example of a farm record?

• A farm diary

• A grocery list

• A travel itinerary

• A weather report

Why is it important for farmers to keep records?

• To remember their favorite recipes

• To plan vacations

• To track the weather

• To help select breeding stock

What type of record includes weaning dates and machinery numbers?

• Personal records

• Financial records

• Weather records

• Physical or production records

Which of the following is a financial record?

• Machinery inventory

• Crop rotation schedule

• Petty cash record

• Weaning dates

What are variable costs in farming?

• Costs that vary with the scale of production

• Costs that are unrelated to farming

• Costs that are fixed annually

• Costs that remain constant regardless of production scale

Which cost does not change with the scale of production?

• Variable costs

• Fixed overhead costs

• Labor costs

• Seed costs

What is gross income?

• The difference between income and expenses

• The amount earned from selling a product

• The money saved in a bank

• The total money spent on inputs

How is gross margin calculated?

• Total expenses minus income

• Variable costs plus fixed costs

• Total income minus fixed costs

• Gross income minus variable costs

What is net farm profit?

• The total income before any costs

• The remaining money after all costs are subtracted from income

• The total expenses of the farm

• The amount of money borrowed from banks

What are outputs in farming?

• The costs of production

• The income from selling products

• Items used to produce a commodity

• The machinery used on the farm