Agricultural Accounting Quiz Form
Test your knowledge of agricultural accounting principles and practices. Please answer all questions to the best of your ability.
Which of the following best defines agricultural accounting?
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Recording and analyzing financial transactions specific to farming operations
Tracking only crop yields and harvest dates
Managing personal finances for farm owners
Preparing government grant applications
Select the main components typically included in a farm’s balance sheet.
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Assets
Liabilities
Owner’s Equity
Crop Rotation Plan
A farm purchases fertilizer for $3,000 on credit. Which accounts are affected?
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Increase in Inventory and Increase in Accounts Payable
Decrease in Cash and Increase in Revenue
Increase in Owner’s Equity and Decrease in Assets
No accounts are affected until payment is made
Rate your confidence in preparing a cash flow statement for a farm business.
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Not confident
1
2
3
4
Very confident
5
1 is Not confident, 5 is Very confident
What is the primary purpose of depreciation in agricultural accounting?
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To allocate the cost of a tangible asset over its useful life
To increase the market value of farm assets
To record cash expenses only
To calculate crop yields
Fill in the blank: The _____ method is commonly used to value harvested crops in agricultural accounting.
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List two examples of farm liabilities.
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Complete the table below by matching each example to the correct accounting category.
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Rows
Asset
Liability
Owner’s Equity
Tractor
1
2
3
Bank Loan
4
5
6
Retained Earnings
7
8
9
Which financial statement shows farm income and expenses over a period of time?
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Income Statement
Balance Sheet
Statement of Owner’s Equity
Inventory Report
Briefly explain why accurate recordkeeping is important for agricultural businesses.
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