Assume a farmer has an accounting period running from January 1 to December 31. Use the following information obtained for the past calendar year accounting period to complete an income statement and answer questions through 12. Inventory Values January 1 $32,850 $18,600 Crops Livestock December 31 $25,440 $31,500 Depreciation Feed Purchased Property Taxes Misc. Expenses Market Livestock Sold Repairs Fertilizer Exp Supplies Labor Hired Fuel Expense Gain on mach, sale Change in interest payable Revenue and Expenses 28,900 Crops Sold $189,600 21,200 Insurance 3,800 3,400 Interest Paid 33,400 5,800 Feeder Livestock Purchased. 46,500 91,660 Seed Purchased 6,410 12,100 Vet. & Health Expense 4,800 9,400 Income from Custom Work 4,700 4,800 Gain on Sale of breeding stock 22,600 7,600 5,800 Gov't payment income 8,890 11,100 Chemical exp 9,780 (2.400) Change in acct. payable +1,400 Other Information Average Asset Value (2007) $785,000 Family Living Expenses Opportunity Cost of Operator Income Tax Paid Labor 24,000 Owner's Equity (12/31) Opportunity Cost of Operator Average Equity Value Management 12,000 Opportunity Cost of Capital 9% $ 38,000 10,700 $402,000 $375,675 Questions 1 through 7 and 9 through 11 are worth 1.5 points each Questions 8 and 12 are worth 2.5 points each 1. What was Net Farm Income from Operations? 2. What was Net Farm Income? 3. Compute Retur to Management: 4. Compute Return to Labor: 5. Compute Return on Assets: 111 6. What is Return on Equity (in %)? 7. What is the Operating Profit Margin Ratio? 8. Compute the Asset Tumover Ratio which is Total Revenue divided by Total Assets. What does this value mean? How do you interpret it? 9. How much did I. M. Farmer's equity increase or decrease during the past year? 10. What was I. M.'s equity on January 1? 11. Value of Farm Production is a concept defined as Total Revenue minus livestock purchased minus feed purchased. What was I. M's Value of Farm Production for the past year? 12. What does Value of Farm Production Measure? Assume a farmer has an accounting period running from January 1 to December 31. Use the following information obtained for the past calendar year accounting period to complete an income statement and answer questions through 12. Inventory Values January 1 $32,850 $18,600 Crops Livestock December 31 $25,440 $31,500 Depreciation Feed Purchased Property Taxes Misc. Expenses Market Livestock Sold Repairs Fertilizer Exp Supplies Labor Hired Fuel Expense Gain on mach, sale Change in interest payable Revenue and Expenses 28,900 Crops Sold $189,600 21,200 Insurance 3,800 3,400 Interest Paid 33,400 5,800 Feeder Livestock Purchased. 46,500 91,660 Seed Purchased 6,410 12,100 Vet. & Health Expense 4,800 9,400 Income from Custom Work 4,700 4,800 Gain on Sale of breeding stock 22,600 7,600 5,800 Gov't payment income 8,890 11,100 Chemical exp 9,780 (2.400) Change in acct. payable +1,400 Other Information Average Asset Value (2007) $785,000 Family Living Expenses Opportunity Cost of Operator Income Tax Paid Labor 24,000 Owner's Equity (12/31) Opportunity Cost of Operator Average Equity Value Management 12,000 Opportunity Cost of Capital 9% $ 38,000 10,700 $402,000 $375,675 Questions 1 through 7 and 9 through 11 are worth 1.5 points each Questions 8 and 12 are worth 2.5 points each 1. What was Net Farm Income from Operations? 2. What was Net Farm Income? 3. Compute Retur to Management: 4. Compute Return to Labor: 5. Compute Return on Assets: 111 6. What is Return on Equity (in %)? 7. What is the Operating Profit Margin Ratio? 8. Compute the Asset Tumover Ratio which is Total Revenue divided by Total Assets. What does this value mean? How do you interpret it? 9. How much did I. M. Farmer's equity increase or decrease during the past year? 10. What was I. M.'s equity on January 1? 11. Value of Farm Production is a concept defined as Total Revenue minus livestock purchased minus feed purchased. What was I. M's Value of Farm Production for the past year? 12. What does Value of Farm Production Measure