Unit 2Unit 2
Record KeepingRecord Keeping
What makes a successful agribusiness?
• Dedication
• Knowledge
• Money
= PROPER FINANCIAL MANAGEMENT
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Record Keeping
• SAE projects help with record keeping skills
• Important to keep good records for three reasons:
1. Management2. Obtain credit or loans3. Cash flow of SAE
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Types of SAEs
• Exploratory– Shadowing a Vet, feed
mill operator or loan officer
• Research– Select an area to
research and determine the outcome
• Placement– Student works for
someone
Types of SAEs
• Entrepreneurship– Student owns their own
business
• Ex: produce and market livestock or crops; lawn care business
– MOST common SAE = Entrepreneurship!
What is an enterprise?
• Enterprise– One total part of the
program – Must keep each
enterprise separate
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Inventory
• Beginning– Itemized list of all assets
at the start of record keeping period
• Ending– Itemized list of all assets
at the end of record keeping period
Valuation of assets
• Depreciation– Buildings, fences and
machinery decline in value over time
– Use the cost minus depreciation value to figure out total value
Draft, Pleasure, or Breeding Livestock • List livestock that have reached
their maturity value at their book value
Machinery, Equipment, and Fixtures • List at their remaining book
value Land Improvements, Buildings
• List improvements such as tilling, buildings, and fences at their remaining book value
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Inventory Assets
• Livestock– Price per pound,
hundred weight or head
• Stored Crops– Price per bushel, ton,
bale or pound
• Growing Assets– Cost invested per acre,
flat, individual plant or individual animal
• Other Assets– Price per hundred
weight, ton, gallon, bag, item or acre
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Record Keeping Transactions
• Transaction– Any exchange of money
• Expense– Transactions where any
money is spent
• Income– Money is gained
Types of Transactions
• Sales and Income Transactions– Revenue derived from SAE
• Expense Transactions– Cost of goods and services
involved with SAE
• Exchange Labor Transactions– Exchange of labor for
money or use of equipment
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Types of Transactions
• Non-SAE Income Transactions– Divided into four areas:1. Agricultural Earnings Not Related to the SAE2. Earnings and Income from Non-Agricultural Activities3. Gifts of SAE Assets4. Gifts and Income Other Than Earnings
• Land Transactions– Any land being used and all expenses must be
recorded
Closing Records
• Balance Sheet– List of all assets and
liabilities– Use this to determine
the owners equity or net worth.