Net WorthNet Worth

Animal Science I and IIAnimal Science I and II

How many people would like to have the How many people would like to have the following:following: JobJob CarCar HouseHouse

The following is one step in getting these The following is one step in getting these things:things:

AssetAsset

Something tangible of value that a Something tangible of value that a person owns.person owns.

There are 2 types of assets:There are 2 types of assets: Current AssetsCurrent Assets Non- Current AssetsNon- Current Assets

Current AssetsCurrent Assets

Items quickly converted to cash, or sold within Items quickly converted to cash, or sold within 12 months.12 months. CashCash CheckingChecking SavingsSavings LivestockLivestock FeedFeed

If a business has $5,000 cash on hand, and If a business has $5,000 cash on hand, and $20,000 in checking. What are their current $20,000 in checking. What are their current assetsassets

Non-Current AssetsNon-Current Assets

Items that are useful for more than 12 monthsItems that are useful for more than 12 months LandLand EquipmentEquipment MachineryMachinery Breeding LivestockBreeding Livestock

If a swine farm has $100,000 in land, and $200,000 in If a swine farm has $100,000 in land, and $200,000 in equipment and housing. What is their Non-Current equipment and housing. What is their Non-Current Asset total?Asset total?

Current Assets + Non-Current Assets + Non-Current Assets = Total Current Assets = Total

AssetsAssets If a turkey farm has $5,000 cash on If a turkey farm has $5,000 cash on

hand, $20,000 in checking, and $60,000 hand, $20,000 in checking, and $60,000 in land. What are their Total Assets?in land. What are their Total Assets?

LiabilityLiability

Debts; Something that you owe.Debts; Something that you owe.

There are 2 types on liabilities:There are 2 types on liabilities: Current LiabilitiesCurrent Liabilities Non-Current LiabilitiesNon-Current Liabilities

Current LiabilityCurrent Liability

Debts that are due within 12 months.Debts that are due within 12 months. Fertilizer BillFertilizer Bill Electricity BillElectricity Bill Water BillWater Bill Feed BillFeed Bill Tractor payments due this yearTractor payments due this year Mortgage payments due this yearMortgage payments due this year

If a cow farmer has a $500 feed bill, a $300 electricity bill, a $350 If a cow farmer has a $500 feed bill, a $300 electricity bill, a $350 tractor payment, and a $1,000 mortgage due this month. tractor payment, and a $1,000 mortgage due this month. What are their Current Liabilities for this month?What are their Current Liabilities for this month?

Non-Current LiabilityNon-Current Liability

Debts not due this year.Debts not due this year. Mortgages (minus this year’s payments)Mortgages (minus this year’s payments) Tractor paymentsTractor payments Equipment loansEquipment loans

If the same cow farmer has $120,000 left on If the same cow farmer has $120,000 left on his mortgage after this year, and $5,000 left his mortgage after this year, and $5,000 left on his tractor loan this year. What are their on his tractor loan this year. What are their Non-Current Liabilities?Non-Current Liabilities?

Current Liabilities + Non-Current Liabilities + Non-Current Liabilities = Total Current Liabilities = Total

LiabilitiesLiabilities If a cow farmer has a $500 feed bill, a If a cow farmer has a $500 feed bill, a

$300 electricity bill, a $350 tractor $300 electricity bill, a $350 tractor payment, and a $1,000 mortgage due payment, and a $1,000 mortgage due this month. If the same cow farmer has this month. If the same cow farmer has $120,000 left on his mortgage after this $120,000 left on his mortgage after this year, and $5,000 left on his tractor loan year, and $5,000 left on his tractor loan this year. What are their Total Liabilities?this year. What are their Total Liabilities?

InventoryInventory

List of items owned by a businessList of items owned by a business Items usually have valueItems usually have value Usually lists beginning value and current Usually lists beginning value and current

value.value.

Two types of inventory: Depreciable and Non-Two types of inventory: Depreciable and Non-DepreciableDepreciable

Depreciable InventoryDepreciable Inventory

Items that are useful for more than 12 Items that are useful for more than 12 months.months.

Loose value over time due to:Loose value over time due to: AgeAge UseUse WearWear Out-of-Date due to new technologyOut-of-Date due to new technology Land is NOT depreciable!!Land is NOT depreciable!!

Non-Depreciable Non-Depreciable InventoryInventory

Items that will be used up or sold within Items that will be used up or sold within 12 months.12 months. FeedFeed SuppliesSupplies LivestockLivestock MedicineMedicine

Total Assets + Total Total Assets + Total Liabilities = Net WorthLiabilities = Net Worth

Total Assets = $250,000; Total Liabilities Total Assets = $250,000; Total Liabilities = $150,000. What is this farm’s Net = $150,000. What is this farm’s Net Worth?Worth?

Total Assets = $300,000; Total Liabilities Total Assets = $300,000; Total Liabilities = $150,000. What is this farm’s Net = $150,000. What is this farm’s Net Worth?Worth?