Payment and receipts

Exit Ticket

Complete the Cashbook Exercise

Cashbooks
Payments and Receipts

Learning Intention

We are learning to explain financial, economic and consumer factors influencing agribusiness decisions and how to plan sustainable and profitable farm production

• Pinpointing areas of in-efficiency and waste

• Preparing applications for loans

• Helping with taxation returns

• Planning for the future

• Monitoring progress of the property

• Planning operations on the property

• Monitoring quantity, quality, and performance

Records have many uses including:

Farm records and budgeting

The basis of good farm management is good records and budgets

Records must be useful, simple, and concise
The two most common types are physical and financial records

Definitions

​Term	​Definition
​Receipts	Money received from a sale or service​
​Payment	Money spent on business operations​
​Balance	​Amount of cash available
​Initial capital	​Money the farm starts with before operations
​Cashbooks	Cash payments and cash receipts (Money in and out)​

Physical Records

Physical records commonly used include:

• Diaries showing daily events

• Rainfall records

• Paddocks records

  • types of crops grown and fertiliser used ect

• Inventories

  • Fertilisers, seeds, machinery, herbicides, drenches, vaccines and other stock

Financial Records

Financial records can monitor the flow of money and assess the farms performance
Financial records commonly used include:

• Statement of assets and liabilities

• Equity or net worth

• Cash flow budgets

• Gross margins

• Parametric budgets

• Development budgets

• Whole farm budgets

• Partial budgets

Multiple Choice

Farm

• Asset

• Liability

Multiple Choice

Debt on Farm

• Asset

• Liability

Multiple Choice

Wages

• Asset

• Liability

Multiple Choice

Livestock

• Asset

• Liability

Multiple Choice

Ute

• Asset

• Liability

Multiple Choice

Account at Local Supermarket

• Asset

• Liability

Multiple Choice

Insurance Bill

• Asset

• Liability

Multiple Choice

Tractor

• Asset

• Liability

Multiple Choice

Rates

• Asset

• Liability

Multiple Choice

Stored Hay

• Asset

• Liability

Multiple Choice

Credit Card Bill

• Asset

• Liability

Budgeting

Farm budgeting involves a number of steps generally starting with Cash Payments (Money Out) and Cash Receipts (Money In)

Basically, any person or business cannot be spending more that what they are bringing in, or they will become unviable.

There is some variability in this, but it generally applies

Cashbooks

Cash payments and cash receipts

1. Rearrange the dates to put the transactions in chronological (time) order

2. How much money must be available to meet payment before receipts come in

​Cashbook Example: Sheep Farming Enterprise

Citrus Farm Example

Using the below information, as a class create a cashbook

• Naval Sales, $1000, 01/07/2021

• Valencia Sales, $50, 12/08/2021

• Other Citrus, $50, 29/03/2021

• Fertiliser, $200, 10/02/2021

• Fungicide, $50, 10/02/2021

• Insecticide, $50, 26/03/2021

• Irrigation, $200, 20/07/2021

Egg Production Example

Using the below information, create your own cashbook

• Egg sales, 15 cartons a week for 41 weeks, $3 a carton (Starting 01/02)

• Chicken sales, 50 birds for $10 each, 03/12

• Feed, $1000, 28/01

• Vet, $200, 16/02

• Lay hen sales, 60 birds for $20 each, 27/01

• Feed, $1000, 16/07

Beef Farm Example

Using the below information, create your own cashbook

• 14/10/21 - Steer and cow sales, $2500 per head (6 head)

• 3/12/21 - Calf sales, $800 per head (5 head)

• 10/04/21 - Cull cow sales, $1200 per head (8 head)

• 23/11/21 - Abattoir sales, $1500 per head (10 head)

• 2/02/21 (start date)- Hay, $500 every 3 months until 11/21

• 2/02/21 (start date) - Grain, $500 every 3 months until 11/21

• 2/02/21 - Vet, $1500

• 2/02/21 - Transport $300