1. is the net farm income from operations plus accrued interest bactical 2. management involves short-term decisions, as opposed to strategic management, which involves charting the long-term course of the business. 3. basis balance sheets only allows for changes in owner equity through retained earnings and contributed capital, not the change in price of capital items. structure ratio shows how much of a firm's liabilities are due in the short term as a proportion of total liabilities