Wisconsin bankers' farm bulletin
Wisconsin bankers' farm bulletin. Bulletin no. 6: business methods on the farm PDF (1.0 MB)
For beat results, list and value each machine and tool by itself. If one does not desire such detail, minor equipment can be listed and valued in smaller groups, as for instance, carpenter's tools, black- Machinery and Equipment. smith's tools and garden tools. But no matter which method is used in inventorying minor equipment, it is always advisable at the time of taking the first inventory to make a complete list of all tools. For later inventories the value of such equip- ment may be determined by subtracting 10 per cent from the value of the pre- ceding inventories and adding the value of new tools. At just what value to put machinery into an inventory will depend on cost, age, usefulness and efficiency. A binder that cuts 20 acres will last longer than the one cutting 100 acres a year. A machine stored indoors while not used will last longer than the one left outdoors, etc. The inventions of new and more efficient machines may cause sudden drops in the values of the old machinery. As so6n as the binder was put on the market the value of the reaper was decreased rapidly. Special crop machinery will decrease in value suddenly in case the growing of that crop Is discontinued. As example of this would be the sugar beet equipment in localities where the growing of beets has been discontinued. The average rate at which machinery will decrease Is not always of much use, but may serve as guides. The following are some of the annual rates of depreciation for the more common machines: Hay rakes, grain binders, mowers ............................ 8% Drills and seeders, corn planters, corn cultivators, gang plows.. 7 % Hay loaders. manure spreaders ........ 12% Walking plows and heavy harness ............................ 6 % Harrows ............................... 9 % Wagons and disks........................................... 5% Cash on hand and in the bank, as well as all notes and bills that the farm business has coming from others, should be determined and inventoried accu- rately. By depositing in a bank proceeds of all produce and Cash and Notes. stock sold, and payment of all bills by bank check, the annual "profit or loss" may be more easily ascertained and annual Inventories more readily prepared. Debts. All debts should be included in the inventory. it is advisable to list each mortgage and note and bill separately, and to give the name of the party to whom it is drawn. The chief aim in taking an inventory should be to make It show the actual conditions of the farm business. In order to make the inventory show this It is necessary to be conservative in all valuations. To be able to Valuations. place an exact value on the different items of farm property is, of course, difficult, but fortunately this is not absolutely neces- sary for the accuracy of the inventory as a whole will not vary directly with the correctness of the valuation of any one item. If one acquaints himself with current prices and tries to be fair in his estimate he is not likely to be very far off on the value of any one item, and what mistakes he may make will most likely offset one another. In case of the herd he may iate some of his cows a little high, but he is just as apt to value other cows a little too low, and the chances are that by adding together all of the values his result would be very close to what the herd would sell for. Subject for February Bulletin: "How to Run a Cow-Testing Aoo.tion".
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