2. Farm/Ranch Business Management Education Year 2009 Jerry Tuhy, Instructor Bismarck State College at DREC

3. Gross Income (Accrual) Per farm for year

4. Net Income Ratio (%) percentage of gross $ that is net $

5. $ Net Farm Income “Profit”

6. $ Net “Non-Farm” Income

7. Family Living & Income Taxes $ spent/year

8. Change in Retained Earnings $ of equity gain per yr (cost basis)

9. Farm Debt/Asset Ratio (%) end year cost basis

10. Expense (oper+ Int) as % of Accrual Income

11. Term Debt Coverage Ratio a 100% ratio means “we can make all debt payments”

12. Cash Flow 2009 AverageLow ProfitHigh Profit Gross Farm Income393111309241783227 Non-Farm Income312653782816849 Cash Farm Expenses369086302768748578 Family Living480433643867711 Income, SS Tax589336839594 Net Capital Purchases10128748219251411 Money Borrowed432389356792906069 Principal Payments340912317932678329 For more info – see www.finbin.umn.edu

13. Crop and Pasture Acres

14. Spring Wheat on Cash Rented (Bu.Yield/Acre)

15. Spring Wheat Ave Yields and Net $ per Acre

16. Costs /acre for Spring Wheat comparing 06,07,08.09

17. Crop Contributions to Overheads Year 2009

18. $ Net income /Beef Cow

19. Beef cow costs, returns 2009 per cow (fuel&repairs in OVHD) averagehigh profit $349$101 $.05 $308 $100 $72

20. How are low profit and high profit Beef herds different ? For 2009 year. Low ProfitHigh Profit Value of calf/cow$469$521 Depreciation per cow$66$64 Direct cost/cow$465$355 Overhead expense/cow $79$53 Cost per cwt (D&Ovhd)$112$78 Net Income per Cow-$141+$72

21. Observations from Dickinson/Glen Ullin combined Rankem- 50 Farms/Ranches NFI median was $ 25,039, 19 farms were negative, 26 were less than $30K. Median FL exp reported was $43K Current Ratio median 1.29, 11 farms had less than 1.00 WC/GR median was 17.1, 28 farms had less than 20% Term Debt Coverage Ratio median was.69. 30 farms less than 1.00 Operating expense Ratio median was 85%.29 farms over 80%. Interest exp ratio median 6.5% Net Farm Income Ratio median was 5.2%, 35 farms under 20%

22. … Be a student so long as you still have something to learn, and this will mean all your life. ~Henry L. Doherty

23. Thank You!