Farm Management Flashcards
(20 cards)
What is an Enterprise?
Identifiable activity of a business
Enterprises can vary widely in scope and scale.
What is a Financial Statement?
Trading Profit and Loss Account, Measure of performance, used for management/taxation purposes
Financial statements provide a summary of financial performance and position.
What do Performance Statistics measure?
Benchmarking data to measure performance against other farms/across years
Performance statistics help in assessing efficiency and effectiveness.
What does a Balance Sheet show?
Shows the assets, liabilities, and shareholders’ equity within a business
It provides a snapshot of the financial position at a specific point in time.
What are Gross Margins?
Proportion of revenue left over when costs are deducted
Gross margins indicate the financial health of an enterprise.
Define Depreciation.
The loss of economic value of capital assets (e.g. wearing out, consumption)
It reflects the reduction in value of assets over time.
What is the purpose of Cash Flow Statements?
Shows money in and out of the business, measure of business’ financial adaptability
Cash flow statements are crucial for understanding liquidity.
What is Farm Business Management?
Making and implementing decisions about operating structure and activities to maximise productivity (and profitability)
It encompasses various aspects such as finance, operations, and marketing.
What are key aspects of Planning and Measuring in farm management?
- Keeping financial accounts
- Inputs and outputs levels (and costs especially)
- Deadstock and livestock valuations
- Depreciation of machinery and buildings
- Overhead costs calculation
These aspects help in effective decision-making.
What does the Farm Business Survey collect?
Data collected = financial, animal/crop production, diversification, farmer and spouse details, succession plans
This survey provides insights into the farming sector.
What are Economic Tools in farm management?
- Financial statements
- Gross Margins (GM’s)
- Balance sheets
- Accounts: financial, assets, and livestock figures
- Depreciation valuations
- Performance statistics, benchmarking
These tools aid in analysis and decision-making.
What are the Primary Financial Statements?
- TPLA: trading profit and loss account
- Balance sheet
- Cash flow statement
Each statement serves a specific purpose in financial reporting.
Fill in the blank: Inputs are resources required to ______ the production line.
start/fulfill
This includes various resources necessary for production.
What are Outputs in farm production?
- Meat/ Animal products
- Crops
- By-products
- Green fuel
- Biodiversity
- Socio-economic benefit
Outputs result from the production process.
What does Productivity measure?
Ratio of INPUTS vs OUTPUTS
Higher productivity indicates better efficiency in resource use.
What does a Balance Sheet measure?
Measure of financial position, especially for the next year or if planning change in business strategy
It is essential for assessing the business’s financial health.
What is the difference between Variable and Overhead costs?
- Variable: directly attributed to an enterprise, vary with size and intensity (e.g., feed, vets)
- Overhead: fixed costs not directly related to size (e.g., rent, insurance)
Understanding these costs is crucial for budgeting.
What needs to be adjusted when generating accounts?
- Deadstock
- Sales owed to us (debtors)
- Purchases owed (creditors)
Adjustments ensure accurate financial reporting.
What are the three main focus points of Veterinary Business Ventures?
- Cash flow = money in and out
- Profit/loss = financial benefit
- Net worth = wealth
These focus points are vital for assessing the business’s performance.
What contributes to good farm management?
- Value adding to products
- Using a product traditionally produced by the farm or another purpose
- Need for veterinary services
Good management practices enhance farm productivity and profitability.
