Test D

A farm business accounting period for July 1, 2010 to June 30, 2011 would be an example of what type of accounting period?

• Calendar year accounting period

• Fiscal year accounting period

• Monthly accounting period

• Quarterly accounting period

What are the steps in the control function of farm management?

• Establish standards for comparing results; measure the actual performance of the farm business; identify problem areas and take corrective action

• Calculate assets; calculate net worth; calculate liabilities

• Assessing the farm; analyzing revenues; analyzing expenses

• Establishing the farm; measuring the wealth of the farmer; identify the problems the farmer has

                          with equipment

Depreciation is a cost associated with which of the following assets?

• Farm land

• Cattle feed

• Dairy barn

• Liquid fertilizer

Assume a new tractor is purchased on January 1 for $124,000 and given a salvage value of $20,000 and a useful life of 8 years.  What would the annual depreciation be per year under the straight-line method?

• $15,500 per year

• $49,600 per year

• $61,995 per year

• $13,000 per year

Which of the following is an investment activity?

• Pay principal on a loan

• Purchase a pickup

• Pay interest on a loan

• All of the above

Which of the following is an operating activity?

• Pay cash for tractor repairs

• Charge $12,000 of feed

• Sell corn for $35,000

• All of the above

Agricultural processors will probably want more uniform products in the future in order to __________ .

• Pay lower prices to producers

• Diversify their product line

• Reduce environmental contamination

• Make more efficient use of processing and packaging equipment

By forming strategic alliances, small and medium-sized farmers and ranchers can __________ .

• Increase their marginal freedom

• Achieve advantages of diversification

• Achieve marketing advantages that larger operations enjoy

• Increase their own volume of production

The most common form of farm business organization is the __________ .

• Sole proprietorship

• Partnership

• Limited Liability Company

• Corporation

In a cooperative, shareholders have voting rights __________ .

• In proportion to the number of shares owned

• In proportion to the amount of business done with the cooperative

• In the proportion to the capital contributed

• That are equal for all members