Worksheets2021 Farm Bis Part 1
Total questions: 50
Worksheet time: 25mins
The USDA Farm assistance program to aid marketing disruptions due to COVID 19 is:
COVID Farmer Assistance Program
Coronavirus Food Assistance Program
Commodities For Agricultural Program
COVID Farmer Aid Program
The agricultural producer's goal of sound tax management should be to:
Pay the least taxes possible
Cheat the government
Maximize after tax income
Pay maximum taxes to support the government
The factors that have led to the recent increase in soybean commodity prices:
Large imports, especially by China
Uncertain weather conditions in Brazil and the Midwest United States
Low stocks/supplies of soybeans in the United States
All of the above factors
Interest that has accumulated on a loan but not yet been paid is called:
Current interest
Artificial interest
Deferred interest
Accrued interest
When a producer is deciding to spend money on an enterprise:
Marginal costs need to be greater than marginal returns
Marginal returns need to be greater than marginal costs
He/she should consult with his agricultural loan officer
He/she should consult with their neighbors
In the simplest terms, a market is the interaction of:
Goods and services
Consumers and the government
Supply and demand
Wholesalers and retailers
Which Farm Financial Ratio is calculated through using the balance sheet:
Profitability
Repayment Capacity
Liquidity
Financial Efficiency
How is working capital calculated:
Labor hours divided by value of farm production
Current assets minus current liabilities
Current liabilities minus current assets
Gross income minus total cash expenses
Which of the following is not a depreciable asset:
Purchased breeding livestock
A house used for hired workers
A purchased tractor
Purchased farmland
Farmers often use trusts and wills in developing estate plans. They do so to:
Pass their estate onto their heirs and minimize estate taxes
Avoid income taxes now even if taxes are higher later
Show their trust in the government
Ensure all of the heirs are treated equally.
Purchasing a put option on corn means:
The buyer is required to sell a corn futures contract at a set price.
The buyer may, but is not required, to sell a corn futures contract at a set price.
The buyer may, but is not required, to buy corn futures contract at a set price.
The buyer is required to buy a corn futures contract at a set price.
Which type of budget can be used to project how many bushels of corn a farmer will have to sell:
Cash flow
Enterprise
Partial
Whole farm
The money used to ensure performance of a grain futures contract is called:
Margin
Premium
Basis
Commission
A line-of-credit loan to purchase fertilizer is:
An operating loan
A mortgage
A consumer loan
A long term loan
How is Net Farm Income calculated:
Gross income – total cash farm expenses
Total assets – total liabilities
Gross income – total cash farm expenses – depreciation +/- inventory changes
Gross income – total cash farm expenses – capital purchases
What number will go in as an Intermediate Liability?
$3,000
$18,835.46
$100,000
$81,164.54
The interest portion of the annual payment on an amortized loan will never change.
True
False
The principal portion of the annual payment on an amortized loan will never change.
True
False
The producer decides to pay more than the scheduled payment of $21,835.46 and makes a $30,000 payment on the payment due date. What is the remaining balance on the loan assuming the payment is applied to the note that same day?
$100,000
$81,164.54
$73,000
$78,134
What is the dollar value of the daily interest charge for the first year of the loan assuming it's not a leap year (365 days)?
$8.219 per day
$1.217 per day
$5.219 per day
$1.5219 per day
Depreciation is a term described as the following:
A method of prorating the cost of an asset over its useful life
The repayment of a loan and interest due over a period-of-time
All of the above
None of the above
Oligopoly is a term best described as the following:
The marketplace has only one firm that is selling products or services
The marketplace has no firm selling products or services leaving an opportunity for everyone
The marketplace has a small number of firms that are selling products or services
The marketplace has an abundant number of firms that are selling products or services
The elements of an enforceable contract are:
Two or more legal parties
Offer and acceptance
Sufficient consideration
All of the above
If a farmer wished to protect his/her commodity prices by hedging his/her soybeans in the futures market, he/she would:
Sell a futures contract
Buy a futures contract
Buy an option in the futures market
Sell an option in the futures market
Which of the following best describes a balance sheet?
It shows profit for the last accounting period.
It shows changes in assets & liabilities over at least one year.
It shows changes in assets & liabilities over the last accounting period.
It shows assets & liabilities at a point in time.
A business has a debt-to-equity ratio of 2:1. The non-current liabilities total $90,000 and the current liabilities total $50,000. What is the value of the assets?
$70,000
$140,000
$210,000
$280,000
A ratio that measures the liquidity of the business is the:
Fixed ratio.
Gross ratio.
Current ratio.
Operating ratio.
Which type of transaction appears in both the income Statement and the Cash Flow Statement?
Cash income and expenses.
Sales and purchases of capital assets.
New loans received and principal paid.
Assets and liabilities.
An excess of which of the following would most likely be associated with the formation of Gulf of Mexico Dead Zone?
Carbon
Oxygen
Nitrogen
Iron
Assume the current balance an amortized equipment loan is $100,000. The interest rate is 3% and the loan has 5 annual payments of $21,835.46. The first year payment is made up of $3,000 Interest and $18,835.46 principal. What number will go in as a current liability?
$3,000
$18,835.46
$100,000
$81,164.54
Cash Flow budgets are best described as:
An analysis of asset utilization
A budget reflecting market value appreciation
A budget analysis of cash movement for a period-of-time
None of the above
Which ratio shows the bank's share of the business?
Farm Equity-to-asset ratio
Farm Debt-to-asset ratio
Current ratio
Term-debt coverage ratio
Which of the following is not found on the balance sheet?
Intermediate assets
Personal liabilities
Crop sales
Accounts Receivable
Which of the following is not a current asset?
Checking balance
Grain Inventory
Tractor
Prepaid expenses
The price of land depends on
it’s productivity
the price it’s production commands
the demand for it
All of the above
An increase in depreciation expense will affect:
Net cash flow
Working capital
Net farm income
Gross farm income
Working capital is a measure of:
Liquidity
Solvency
Repayment capacity
Efficiency
In a background feeder operation, the total cost per pound of gain is $1.00. If a 600lb steer is purchased for $145 per cwt and sold at $125 per cwt weighing 850lb, the net income will be?
$57.50
$250
-$57.50
-$250
Which of the following is considered a capital purchase?
Used tractor
Pickup
Yearling bull
All the above
Which of the following is considered a solvency measure?
Debt to Asset Ratio
Net Farm Income Ratio
Asset Turnover Ratio
EBITDA Ratio
APH stands for:
Already Produced History
Actual Production History
Actual Production Harvest
Actual Produced Harvest
How many pounds are in a live cattle futures contract?
25,000
40,000
50,000
100,000
If the total cost to produce an acre of soybeans is $377.60 and the price per bushel is $11.50, a farmer should produce _______ bushels/acre to break-even.
30
31
32
33
Total interest to be paid over the life of an amortized loan equals:
The amount of money borrowed times interest rate times number of payments
The amount borrowed times interest rates
The number of payments times the size of payment
The number of payments times the size of payments minus the amount borrowed
Drought would be an example of
Human risk
Market risk
Legal risk
Production risk
A rancher exposes 1,250 nannies to bucks. Of the 1,250 nannies, 1,100 give birth to 1,875 kids. At weaning, he has 1,775 kids with an average weaning weight of 42 pounds. What is the rancher’s weaning percentage?
1.42
1.50
1.61
1.70
In the question above, how many pounds are weaned per exposed nanny (to the nearest pound)?
50
60
68
71
A farmer should keep good financial and production records in order to:
Make sound business decisions
Be able to prepare an income tax return
Apply for operating and chattel loans
All of the above
A form of business organization in which one operator owns the resources and provides the management is called a/an:
S Corporation
C Corporation
Partnership
Sole proprietorship
What ratio shows leverage position?
Current ratio
Operating expense ratio
Debt to equity ratio
Term debt coverage ratio
