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&at*ria\*
PSef &*g&** XW

Farm Management
Sharon Dell B. Paras
B.S. APPlied Mathematics
M.M. DeveloPment Management
and
Fernando 0, Paras lr'
instructor/Engineer
Agricuitural Machinery Division
Inst:rtute of Agricultural Engineering

MANAGEMENT

.Theprocessofoptimizinghuman,materialandflnancialcontributionsforthe
goals'
achievement of organizational
zjstdlt
rr'ru utfoi &tting things done through offi,l!T^l-t:
iil::":;'::;;X:i,Zi;;;:;;;';;ii,ii*::::pefformwhatevertasks
the tasks themselves'
may be necessary - not by ieforming
goals through the
process of setting and achieving
. Management is defined as the human' financial and material
execution of the management functioiJifiJ 'tifi'"
resources. ?t[lg
leading an9 igntr?llllg l[:T-"rts
of organizational
Process of planning, organizing order to achieve the
organizational resources in
members and the ur" oi iff arlilabte
stated organizational goals'
shaping organizations'
Practice of consciously and continually
goals'
resources to achieve organizational
. The effective and efficient use of scarce

MANAGER|_Peoplewhoareresponsibteforhelpingtheorganizationsachievetheirgoals'

CHARACTERISTICS OF A MANAGER

l.AssumesreponsibilY.4.malsgeris.inchargeofspecifictasksandmustseetoitthat
evaluated on how well he/she
they are oone ffissfully. The *.nug;'ii-'*uirv
uiiing.. for these tasK to be accompli5hed'

between goals and

ooals- Each manager must strike a balance
2. Must batance competing
needs.
-#
helshe must be
must be an analytical thinker; that is
3. conceotual thinker- Every manager,
concrete pronfeiiifirougtl and come up with a feasible
solution for
able to think a spEcific,
lI.

Fertt* F4e*ag*r**m*
 W%&EF**91**ZV * **gcn*erz** ffie,ar* W*wB *w* ?4"alt*riats
*zsltwr*$ xv^2
Ws{a with and through oeoole {subordinats. suoeruisorc and "oeers?- The manager
wor'rs wiih anyone ai any ievei in the organizaiion who can heip himlher achieve unit or
organizational goals.

#di#er' Disputes within a unit oi'organization ean affect moraie anrj prociuctivity anci
may even cause some competent employees to leave the organization. Settling disputes
require skill and tact, and a manager who is careless in handling such a problem may find
that he oi'she has only made it lvorse.

6. Potitician-A manager, like a politician must use the arts of persuasion and compromise in
order to promote organizational goals.

l:-DMaWt - The manager is the unofficial representative of his/her work unit at

organizitional meetings and in dealing with clients, customers, contractors, government
officials and personnel of other organizations.

8. Makes difficult decisions- No organization runs smoothly all the time. Managers are the
people who are expected to come up with solutions to difficult problems and to follow
through on their decisions even when doing so, may be unpopular with some person/s,

MANAGERIAL RQLES

. Liaison = interpersonal role; act as a go-between

o Monitor -informational role; check what is going on outside the relationship
o -
Negotiator decisional role; discussing and debating on certain issues

II. EFFICIENCY AND EFFECTIVENESS

A manager's pertormance can be measured in two concepts: effediveness and
efrrciency.

. Efficiency = abil'ity to get things done correctl,y; doing things righf, an "input-outpuf'
:
- i?T:?liff ["g,f,,JI]:9 #|.|i;. *,,esor,rces, n ach ievi ns orsa n izationar
i

objectives.
'| -
An efficient manager is one who achieves outputs or results that measure
up to the
inputs (labor, materials and time) used to achieve them. If the manager is able to
minimize the cost of resources he/she uses to attain a given goal, that manager is
: actirtg effieientiy.

Input
Wa W,' af pranattf,g, efficie n cy :
1. Same input, more output
2. Less input same output
3. Less input, more output

Wiren**- abiliff to choose appropriate objeetives or the appropriate means for

. achieving a given objective; doing"the nght,things.
- An effective manager selects the right things.to get done or the right method for
getting a particular thing done.

ilI. PROCESS OF MANAGEMENT (SEQUENTIAL MANAGEMENT FUNCTIONS)

F*rrm Ma*ageme*t
BE ZT * &gri*ca1*e;ira* Wrugr**-*r***q &w*x* W*vE*w WaE*ra*EY T,l*3
ffi,establishinggoalsandasuitablecourseofactionfor
iheir aciions ihrough in acivance' Thelr actions are
achieving ihose goals. i''ianagers think
usually based.on some rnethod, plan, or logic ratherthan on a hunch. Plans are needed
to give the organization its goals and set up the best procedure for reaching them. Plans
pernrit the foiiowing:
. For the organiiation to set aside the resources it will need for required activities
. For the members of the organization to carry on activities consistent with the chosen
ulEuul'.aagJ/
^-^-^-1,
Pl
-^rl lu
sl
. For the progress toward the objectives to be monitored and measured so that
corrective action can be taken if the rate of progress is unsatisfactory

Z. Organizing - The process of arranging and allocating wor( authority and rsources
among an organization's members so that they can.achieve the organization's'goals.
Managers coordinate the human and material resources of the organization. Achieving
,,;r coordination is part of the manager's job, Once managers have established objectives
- and developed plans or programs to reach them, they must design and develop and
organization that will be able to carry out those programs successfully. Staffing
(recruiiment and piacement of the qualified personnel neecied to cio the organization's
work)' is also considered a part of the organizing function.
The organizing process can be described in a three-
step procedure:
. Detail aii the wo*that must be dsne to atiain the oi'ganization's goais
-'
. Divide the totat work load into activities that can logically and comfoftably be
performed
'Set by one Person
. up a mechanism to coordinaiE the work of organization members into a unified,
harmonious whole.
upihnqlh t,,it fttf'tl utl lh t,1h] ploo
3. Saffingi-'C6nci'r,{eolwitn locatind pr6spective ernployees to fiii the job createci by the
otgantzng process. Staffing involves the process of reviewing the credentials of the
canOiOates for the jobs and trying to match the job demands with applicant's abilities. It
aiso invoives the develoBment and implementation of a system for appraising performanee
'and providing feedback for pertormance improvement.
rnpttt,it +lo pullf tn,r','/, ,l/
'aimed kin'n,.r1l
J
,b)ttl',r!S
1- o*e#:# = birectiiig is at geting rirembi:r's of the organization to move in the
drection that will ichieve its objectives. It builds a climate/environment, provides
leadership and arranges opportunity for motivation..

&, ffilling The process of ensuring that actual activitres conform to planned activities.
-
Ulanagers attempt to assure that the organrzat\on \s movrng tov,lard \\s goa\s. lf some par\.
cf their organization is on the wrong track, managers try to find out about it and set things
nght. Contro\\ing invoNes three e\ements :

. Establ'rshing standards of performance.

. Measuringiurrent performance and comparing,it against the established standards.
. Taking aCtion to correct any performance that does not meet those standards.

6, Lding - (Some boot<s consider this as a management function)The process of directing

and influencing the task-related actlvitres of group. members or an entire organization.
Fhnagers direct and influence subordinates. They don't act alone, but get others to
perform essential tasks. They don't simply give orders. By establishing the proper
atrnosphere they help their subordinates to do their best.

Tbe are four leadership styl*Ehatwere identified by Rensis Likert and these are:

h f,lanagence*t

)
W&eXF.;*z1*xEV * ri**ltu**$ *ar& Retrie*r i{ate*ais zv-4
- Managers make all work-related decisions and oder
' iheir subodinaie io cai'ry them oui. Faiiure to meei the managers goais resuib in
threat or Punishment.
b)
- -
Sqtem (Benevolent Autltoritative\ Managers still issue orders but subordinates have
=ome
t eeeom to eommeni on these. Subordinates who meet or exeeeci ihe managers
goals may be rewarded.
-System
c)
- i (Consultative\ - Managers set goats and issue general orders after discussing
ttrem with su6ordina+.es. Reu,iards, rather than the threat of punishment, are used to
motivate the subordi nates.

d) Sustem (Participative\ Goals are set and the group makes work-related decisions. If
-
ch a decision, they do so after incorporating the suggestions and
opiniJns of the oihe, group members. To motivate subordinates, managers not only use
economic rewards but ilso try to give their subordinates feelings of wotth and impoftance.

IV. FARM MANAGEMENT * Study of the ways and means of organizing land, labor and
capital and the application of technical knowledge and skill in order that the farm may be
made to yield the maximum net returns. It also refers to the utilization of sound business
principles and technical knowledge in the planning and organization of a farm and the
ippliiation of skill in its operation for the purpose of attaining the largest continuous profit
of the f?rmer as an inciiviciuai'

It is the art of applying business and scientific principles to the organization and
management of farm business enterprise for the purpose of securing the greatest
continuous Profit.

A. FUNCTIONS OF FARM MANAGEMENT

1. Setecting methods and practices and training labor to be ased in performing

various operations. (Manaaement of La$ort

z. Makins-"Eh;fuitci/lg*Y*ruIhilrTr) adiustments in the propottion or the

factorc of production and other parts of the farming program,
This function refers to the making of adjustments from day to day or from week to
week - adjustments, which shoulci noi be postponed or adjusimenis oi reiaiiveiy mihor
impoftance. Weather conditions and unexpected price or cost changes are the causes
that commonly give rise to such problems.

3. Controlting and directing the various resources.

This miy be related to the second function that if days to day adjustments are not
necessary, the problem of control and diredion will be less cor^nplicated. It rnay be also
related !o the probtem of selecting methods and practices, the problem of how
operations are to be performed, This function may also be described as the control and
direction of labor involving'the expert.handling of the resources on the part of the
manager so that the maximum production efficiency may be obtained. . The goodwill and
cooperation of laborers should be controlled and directed in such a way as to retain this
esPrit de cor7s' mpfll) .rrworti,,1
Buying and setling, (Manaoement of Caoital and Manaaement of LandJ
* PJa,r "f Arrufi,rn* ?(r,ritru*r
n1

5, Keeping records and aCcaunfi.,{Farm Reords and FatmAqcounts)

Ferem M*ne#ext*m*
 W%e"X, K*gi**'t HW * #^qri*a*E?.*tra.*. **ptxeeri*#&**r*W"*wie:usut $4etenial* w-3
6.
Seeing that thit entire productive prooss proceeds *noothfy fiom'day to day
ihroughoui ihe yean
Good management involves c hat they
,rro,y h may all move forward smoothly without delays at any Do-int. The various interdependent
.l' Barts of the organization must be macie to oBeraie wiih a minimum of frictiorr. Operations
requiring cedain materials may be postponed if the manag'er doesn't have the foresight to
rr,fu u1ri,,*n,have these materials available at the appropriate time. The use of implements, machinery,
nmff cb and laboi' must be planned so that each operation may, be performed at the propei" time
and without unnecessary delays.
rr inil f
uii,rr krur6, ru,rch; ,r(l 4 1rd ldh
-- Noting tAntative adlustnenB in the -raetorc of produc+-ion uu-hich seem desirable
because of price or market changes, sauings of materials, utitization of waste or
* *rrhrrrtr by-products, or introduation of new methods and practics.
.,,pJ, ,,j,,,,, Changes in prices,'methodologyand numerous other elements tend to make major
ustments necessary if the greatest returns are to be derived from the available
,|
I(L\ror( resources year after year, Decisions to change the general policy of the organization, the
-,', enterprises and the proportion of the enterprises from year to year or for longer periods,
'''' 'reirillil) anci making necessary adjustmenis faii within the scope of this iunction,
lf,.ir-, r
B. MANAGEMENT OF LABOR (First Function)

Sourcs of Labor
1. Familv labor- farm labor mainly supplied by the family circle,
2.. Hired labor- farm labor supplied from outside of the family.

Some ruls for labor Management

1. Ptan a labor calendar, which will keep down the peak labor requirements, An hour's labor
is wotth mueh more in the rush seasons durinE harvest time, than at other times oi the
year. Try to have the smallest possible number of jobs competing for your time during
these rush periods,
2. Dont do slackeasan work during rush seasons. Put off manure hauling, fencing, cutting
weeds in fence rows, etc. until times when there is less to do.
3. Plan rainy4ay work in aduance.
4. tuehange labor with neighbon.
5. Cut chore labor to a minimum.
6. Simplify and combine jobs whereveq you can.
7. To save labor on livestock, self-feed everything that you can. Use large self-feeders that
can be filled once a week.
8. {Jse extra care in directing inexpeienced tabor.
9. Select laborerc carefully. Fit the worker to the type of work.
1A. Clearty assign tasl<s, train & superuise tabor with job analysis.
tt. Develop initiative, good will, cooperation and resryct,
72. Plan day-to4ay utilization of labor, make day4q-day adjustments.
13. Provide sociai iiie.
74. Keep a high-grade labor on the farm such as giving out bonus* and profit shaing

Glassificatlon of Farm lobe

1. Fieldwork- Fieldwork on crops should come first and must be done in clear weather
with moderately dry soil. Plowing, preparing the seedbed, and planting crops must be
done at iust the right time to be most eff.ective.

2. Outside work thatcan be delaved -These include tasks as hauling manure, building
fences, plowing, husking corn, ditching and tiling, cutting and hauling wood and
outside repairs to buildings

farer Mamage**ex*
W%eg. W^*gz*r* EW * &grcr,e*Etrl,r*E **gi*wring &*ar# W-*wl*wa 9zlrrt*raa\* xw*&
3. W.o* for railv days - In order that no time will be wasted by downpour, indoor work
such as repairing machinery, sharpening mower sickies anci oiiing machinery ancj
harness should be kept in mind.

C. FiAi{AGEFiEI'IT CF CAPI-rAL (Fourth Furictioni

&pitat - include any goods employed in production other than land, labor, buildings and
fences, All work-stoc( machinery, equipment, power engines, feed, seed, fertilizer
and other materials are included in this category.

Plans for the use of working capitat

Plans for the use of working capital will avoid conflicts in the use of machinery,
equipment or work stock; they will allow a fuller utilization of these same elements; and they
will provide a scheme for the provision of various supplies and materials necessary in the
peformance of operations. Detailed plans for all elements are necessary to facilitate a
smooth, forwarci moving program to avoid costly deiays.

Adjustnen9 in twrking capitat

The farm manager cannot expect that a detailed plan made in advance can serve as a
production guide for the year. Weather condition will hasten some operations and postpone
. others, causing conflicts in the use of machinery and quipment and changing the time when
materials need to be available for use. Changes in prices may make some necessary
_ adjustments in the feeding of iivestock; that is, more feed may have to be acquired, rations
may have to be cut down, or one class of livestock may have to be fed heavily at the
expense of another.

The adjustments should be made in favor of the enterprise which has the greater
positive effect on total profits, or in favor of
the operation which adds most to total returns
for the farm as a whole.

Supervision of the working capital

The operator's objective in supervising the use of working capital is to prevent wastes
in the use of seed, fertilizer, feed and other materials and to prevent abuse and rough handling
of machinery, equipment and work stock. In case of materials, any amounts wasted are direct
losses and tend to lower efficiency by increasing the input per unit of output, since any amount
wasted must be considered as attributabie to the productive processes When the values of feed
and fertilizer used each year are high, even a small waste is important. Supervision of working
capital is a function or a responsibility closely allied to that of labor supervision. In this case,
supeivision is direeted at effieieney in the use of eapitai goods, i'ather than at the effieieney in
the use of time and labor. Each class of working capital should be kept under detalled
surveillance at all times and in all productive purposes, so that maximum efficiency in its use is
ahtrinad
vulqrt rEur

D. MAI{AGEMENT OF LAND (Fourth Function)

Farmers are prone to exploit not only their land but
also their water resources
beyond the point at which these resources make their maximum contribution to the net
income of the farm. Such exploitation, intentionalor otherwisg if continued long
enough, inevitably leads to partial or complete destruction of the. productive power oi tne
land and water. Thus, it of great importance to tlroroughly understand the principles
invOlved inth Conservation of srrch,recources. (USe Soil and Water COnservatiOn
Engineering by Schwab as reference)
n.i
'$rl lr0rr0qrlIiri,ulll
rucrr(t(t, p,,drlrfi ,,r!

F*rryg Fdanagertten?
PSAE *ry\*rzTV * &girlx*sfi?z:ira2*rrwu@w*at*;ria2*
**"-ti
g\l "7
r. runoar,lENTAL TACTORS RESPONSIBLE FOR FARMERS',SUCCESS -
1. Seieciion of the right iarm for the type and sysiem of iarming io fit ihe farm inciuciing the
deision on whether to buy or rent the farm'
Z- proper sizes of farm business will efficiently utilize the available labor, power, machinery
equiPment and caPitai.
3. The relative importance of diversified enterprises will promote full use of the farm
resources and business stability, including adjustments necessary to meet prospective
changes in the mai'ket.
4. The iupply of adequate capital and the utilization of credit.
5. A study of the best layout of the farm into fields or farmstead.
5. Prop; provisions of buildings, equipment, irrigation and other farm requlrements.
7- The importance given to conservation'
8" Importance of keeping adequate records to insure a reliable source of information for
planning.

9. Proper attention to the marketing of produce and the purchase of farm supplies'
10. Day to day decisions that has to be made in the farm.

F. q.,ASSES OF RISKS IN AGRICULTURE

1. Those resulting from natural factors such as extreme weather conditions, fire; flood,
earihquakes, and pests and diseases.
Z. Thosearising from human factors such as carelessness, incompetence, dishonesty, theft,
and political disturbances.
3. Those arising irom unpreclictability oithe market conciitions.
'*ffi*m*- iir llnli ry, t ri<i-t
Hethods of Reducing Risks
1. Insurance
2. Diversification
3. Future contra*ct - selling the product at current on agreed price delivering them in some
future time.
4. Flexibility - ease with which the organization of production can be changed'
5. Liquiditf - the maintenance of balince of money or assets that can be readily converted
into cash.

G. INVENTORY FARI,I RECORDSAND FARM ACCOUNTING SYSTEM (Fifth FUNCIiON)

Farm Plannins and Budseting

tlse of Farm Plans

1. Serve as a yardstick for performance and accomplishment'
2. Senue as a guide or reminder on the schedule of activities'
3. Provide a basis for evaluation and improvement
4. Serve as central facilitating aid'

?r{:{,3;{::tri'K:f K:n:
2. REview and analysis of alternatives.
3. Deciding on alternatives and fittlng them intd one plan'
4. Summarizing the resources requirements and output expectation.

Elemen9 in Comptete Planning and Budgeting

1. Personnel organization
2. Calendar of operation
fanrr Mar*a#erlle*e

./
 "e*rzW * &*tir;w1hu.r*1 x*g:rl*# ffi*at* W^*wl*wa ?&wb*ri*la aw ^&
'!ETE
-- 3. Schedule of labor requirements
+- Scheduie oi suPPiies required
5. Schedule of expected production and income
6. Summary budget and test of success

H. FAR,{ REcoRDs (Fifth tr\,r?fir,}nn

q,rd, ,.,o,r,*} ? in1trfu vqlufrlrfl,
y
lurql crrri,l ,r0\fytrll
ttSgOf far,,ff reCOdS 2.. .,)t
u4r&rfls

$ 1. Provide data 6r farm planning and buogetlng'

T,Aidtocreditinsurance,taxesandinpreparingrepofts'
ri
tr 3.Givedatafor.groupactlononlocalornationalprog!.ams.
ii 4. provide information useful in property valuation'

StePs in taking Farm inventory

1. List down all farm Property'
2. Put value on each item'
3. List allfarm debb and receivables' analysis purpose.
4. iummarize the information for farm
Methods of valuation of inventory
1. Originat cost - actual *purchase cost' of years'
2. Nsrmal mar'ret value estimated average seliing priee over a number
3. Present market value'
4. Original .ort t.tt depreciation' 1ol'9uai"ru)

Exampte of flummary budget:

SEASONS
Wet Dry Both !)x)
22,069 27,A90 49.L67
Receipts

840 1.148 i,988

Fertilizer
873 7At t,474
Insecticides
70 76 146
Weedicides
880 880 1.768
Seeds
65 65 130
Gasoline
22 22 44
oil
3,446 3,630 7,176
Hired Labor
Darmrnant I:hhr r,800 1,800 3,600
281 393 674
Irriqation Fee
50 50 100
Repairs
SUB-TOTAL (C)
.yttl 8.765 l-l til r N"t& u,aqt,

Nan-alch FYnenqe,s
4.872 5,040 6.192
Land Rental
3.377 .+,3V1 L661+
Haruester thresher share
hanraair*inn 848 848 4,696
li1.sl(
SUB-TOTAL (NC) - 1o4l ' 11 lirD
lY,n>2.
TI,NLl 10.395
io'rai -otPenses (ST c + rrc)
u4r\ 7,934 36,592
ntet farm Income (Rec -TQ

Eltrf qlql
Sampte Form of a Farm Record;

S*resa &ta*agert?e$?t
 EW * &qri*eefrtaxral **g?tz**rir** e*at$ 3*vi*sq fqekfiee# w*g
INVENTORY DATE AS OF MaY 1, 2002

ASSETS LIABILITIES AND NETWORTH

Current Assets 4s.000 Current Liabilities
ash on Hand 175,000 Accounts Payabie (in i Year) i19.000
Cash in Bank 43,000 Taxes oavable 75.000
Acc'ts Receivable /
Dltl,
48,000 Total Current Liablities r nn)

Feeci Suopiies on Hanci ,/ s0,000

Stored Crops z' Lonq Term Liabilites
Total current Assets .1bl rh Notes payable (due next Yr) 200,000
Baiance oi moriage IUU,UUU
Fixed Assets Total lono term Liabilitie '1r, l)D
Land 300,000
Farrn Buildines If,U,UUU Net wortir
Machinerv. Eouioment 100.000 Caoital 200.000
Work Livestock & Breeding ss.000 Net Income 85,000
Ei,-^f l^^^t^ T^r^t trl^& llr^+L ){t,Lxd)
I UL6t rlxcu Aj5tL5
-^!^l t, D.[, nn I rJLcil IYEL VyUi Llt

"h7
TOTALASSETS ffi qbL,NN, TOTAL LIAB & NET WORTH ftf)

Financial Analvsis:
t.

a) Liqu idity/Solvency ratios

--:i
Current Ratio : Curent Assets = |)A - Q\-/Pbrl
current ti'aoitities '/ lll't'f't

{For every PhP1.00 gf current liabilitie, there is a PhP(Current Ratio) of assets to pay for the
-liabilities) \
/y'
(IDEAL CURRENT MTIO => 2:1)
qllba
-WL
// u l,3lr
Ratio = Cu rent Asseb-In J{r/,,xr}
b) Qa ick/Acid -Test ven tori es
Liabilities
Current t4(,m
(IDEAL QUICK RATIO => 1:1) ./

c) Net Working Capital = CurentAsseb - Current Liabilities

(Amount of funds available for payment anytime)

farnn Fdan*Weffia*t.
 * {aura*a}Et**'x'r**gZ**ri"*g#*'*rd&w*sif:wWw**ra*ls "Eq * 3.8
V%{anffi*&2*tzZW
SOME TER},IS IN FARIVI MANAGEMENT

- tartnlss-.refers to the cu\tivation o{ tand w(th or without the beneftt of sound. business,
technical knowledge and skills.
. Prsonfiei mafiageffient- eoneerRed wiih an effective reeruitment, seiection, Biaeement
development maintenance and utilization of manpower to obtain optimum efficiency of
labor.
lla*arial aaaaaaaan*- ins)rt)ar )ti-iar nat*arma) htt nttzh;ninn at*ai;l nttnaniniaa ;a
e
- a,Ecragl ,et ttt(Ertg!,gtrrc:a?a- t!tLt,JUgJ uuLrcJ lJc:,t(/tttrcu uy vutLttaJiltvt tttoLcttct Jul,t=t vt't(/tt cJ
inventory controls, inspection of materials and salvage operations.
. Financial management- involves planning the procurement and utilization of funds and
contro$ing thefrnancia{ operations to insure effediv.e uti[iatlon of funds.
. production management- deals with the planning, direction and control and decision
making necessary for carrying out the production processes.
Marketing management- is the planning, directing -and controlling of thepolicies,entfre
marketingldivities of the farm, including the formation of marketing objectives,
programs and strategies for product development'
Fri"rn pianning- proceis by which a farm manager looks ahead to the future and
tfrl
contempiates aiternative courses of action for the farm'
Budgeting- the process of determining requirements, allocating of resources
and

estirn'ating the retuins for the different activities of the farm.

C"*tl.* Fianning an6 auCgeting - takes the whoie farm as the subjeet for deeisions'
it considers all expenses and r[turnJ so that the figure indicates the performance of the
entire farm.
pa#ial Flanning and budsetlng takes pait of the_farm as. the subject for decision. It
=
patts of the farm under consideration so that the
considers tne expensei u,ilt.tutni of the
with change envisioned rather
net returns (or loss) ,;ri6""tiy tfri profiiability associated
than the whole farm,,/
iJ"nJ"" i"r.irJ - pertains to farming activities utilizing fixed outlay of labor and
capital to an increasing area of land.
inq amount of labor
iniensive Farming - a method of farming which utilizes an increasing
and cbpital to the same area of land.
iorrrpii"t farming --t tytt * of grouping continuous pooled
land holding for the purpose of
together from among the
ur on. fu-rrrt .d. ,*out.5t foi ploduction are
"p.iiii.g
other member.
transaction between two parties in which one
(creditor) supplies Toney,
credit- is the
goods and service and other securities on the basis of a promise that payment by the
otiiet (deOtor) wouici be clue at a sBeeifiecj time'
to finance
aJrrcriiu.ul credit- includes all loans and/or advances granted to borrowers and distribution of
processing, marketing, storage,
activities relating to agriiuttwe and the
pt rJuuLLs.
'galance'sheet statement of what an enterprise owns and what it
or Farm inventory-
owes as of a Particular date.
iarm Econornis/.4qricultura! Economics - concerned.with the farmer as a member of
ffimsasagroupanddeterminestheprinciplesgoverningnotonly
ine fjl* general welfare on a national and international level.
business but also the
unit of
Marginal Cost - the additional cost that a producer incurs in makng one additional
output.
production of several main
Diversified Farming - type of farming, which engages in the
products/crops.
b-*"k: point - a point at which a specific volume of sales with which a firm neither
profit, below it' a loss'
loses money.'Above this point, a firrn begins to.show a
"rr"n
makes nor
Break-even analysis ii used to compute the approximate
profit or loss that will be
experienced at various ieveis oi prociuction'
of land'
Multiple Cropping - is the raising of several crops from the same area

faffirc &44;tagea**xtt
W#8utr&x#E*ruTW * &Wrirewltwral #*z#e**er1rra# &*ar& W*"aa*ws Wat*rl,a&s Tg ' LL
. Elasticity of Demand - is the ratio of the percentage change in quantity demanded to
ihe percentage change in price. Eo = Qo/Qp.
r Marginal land - refers to the grade of land whose productive capacity is only enough to
recover its cost of production.
. Farm Buciget a projeciion of the cash iniiow anci ouifiow oi a iarm io estimate the
-
incremental net benefit over the life of the project.
r Efficiency of Production - refers to the relationship of the output to input.
. Enflation - is the i'ise in the amount of money in cii"culation beyond the legitimate needs of
the business so as to cause a reduction in the value of money and increases the price level,
. Depreciation Cost - is the cost outlay of the firm for the wear and tear of machines,
hrrildinos.
--.,v.t.3at
and imnlements- It is a naft of the tota! fixed cost of the business.
's v rY

. Hedging - is the technique of buying and selling that minimizes risk due to price
fluctuation.
. Oppottunity Cost/ Alternative Cost - the value of the productive resources used in
producing one good, such as automobile, instead of another such as tractor. The cost of an
automobile is the value of other things that cannot be produced because of resource
limitations at a given time.
. Unearned Increment (Income) - consists of income received in advancerj for which
goods/services will be provided in the future.
. Law of Diminishing Return - the economic principle which states that successive
portions oi quantities of variabie factors of proeluction is other factor of Orodueiyr&hieh is
fixed will result in diminishing marginal productivity, at least after some points. '
. Comparative Advantage - the special ability of a resources to provide/produce one
pi'oduct oi' sei-vice r"elativel'y more cheaply than the other products or sei'vices,
. -
Marginal Product an additional product realized from additional investment or
expenditure of the business.
r Dlseount Rate - the interest that a commercia! bank Bay when !t borrows from a central
bank, using government paper or bond as security. The discount rate is one of the tools of
monetary poliry when central bank authoritie are trying to prevent inflation.
. Economis - a special science concerned chiefly with the description and analysis of
production, distri bulion and consu mption.
. Cooperative -rtorganization owned collecLively by members who share its profits and
benefits. ,/
. Corporation - a group of people who geb a chafter granting, as a bocjy, certain legal
rights and liabilities of a single individual.
.Tariff.thetaximposedbythegovernmentonimpofiedgoods.
. Comrnorr Stock - eaBitai stoek in exeess of the vaiue of the asseis of the issuing
corporation.
a Excise Tax - tax levied directly upon classes of goods produced within a country.' ./
preferred Stcck - a stock that entitles the holders to a prefei'ential treatment as tar,/
dividend as well as to the distribution of asseE in case the issuing corporation liquidates, /
a Price - the exchange value of goods or services measured in terms of money.
? Revenue - is the income derived from the sale of goods'
a Tax - fund collected by the government to finance its activities
a Securities - written or printed certificates giving their lawful holders a right to demand
and receive property or payment.
Sinking Fund - a fund set aside pe;ditally before dividends are declared for the purpose
of retiring the bond at maturity. -,.-
Complementary Enterprise - when a transfer of resources to one product and an
increase in the prociuction oi it are accompanied by increase in the production of the other.
Competitive Enterprise - an increase in the production of one makes a reduction in the
other, given a particular level of resources.
Supplementary EnterBrise - if pi'ociuction of one ean be increasecj without increasing or
decreasing production of the other.
Balance of Trade - when exporb equal imporb.

Farm *"*n*W*xrie,t\t

)
l

v#t*ffF"*#e*7w * Ftg{*ewttur*t **qzruwr'awg &*ard .tr.ew"s*www*xrzals w * kx.

. Balance of Payment - when dollars received equal dollars paid.
o Baiance Buaiget - when a iirm breais even in income and expenses.
a Closed Shop - an establishment in which the employer by agreement hires only union
members in good standing.
a Diviciend - payment macie ior company's siocliroiciers.
a Interest - payment for the use of capital..,/
a Opdn Shop - an establishment in which eligibility for employment and retention on the
payi'oll are not determined by membership oi" non-membership in a labor union.
Extractive Industry - an industry which pertains to the withdrawal of product from an
origin by o<traction with the provision for reproduction (e.9. juice from pineapple),
? llavalrlatian - when necn hernmec cheaner rnmnarad tn fnreinn alrrrtrnav
a Excfuange Rate - prices of dollars in terms of peso.
a Depression - an economic state which is characterized by sickening business.
a Capital Goods - peftains to the produced goods used to produce other goods.

Definition of Tenirs:,

Basic Economics for Agricuitural Engineerc

Assets - economic resources (things of value) owned by a business, which are expected to
benefit future operations. "Current" asseb consist of cash and items expected to be
converted into cash within a reasonably short period, usually one year. "Fixed" assets are
durable items of relatively long life that are used by the enterprise for production of goods
and seruices.
Book value.oi an asset - the value oi the asset after subtracting depreciation; the
depreciated value of an asset as reflected in the company's books; also called carrying value.
Border price - the unit price of a traded good at a countq/s border' For exporB, the FoB
priee; for imBorB, the CiF priee.
Cash flow - also called net benefiU in project analysis, the amount remaining after all
outflows are subtracted from all inflows.
CEF (co=t, insurance, and freight) = the landed cost of an import on the dock or other
entry point in the receiving country. Includes cost of international freight and insurance and
often includes cost of unloading onto the dock. Excludes any chaps after the impoft
touches the dock and excludes al! domestlc tariffs and tax-es ar fe*,./
Creditworthinss - the ability of an individual, firm or nation to meet its debt seryice
obligations. For a firm, a judgment about creditworthiness is often formed on the basis of
one or another financial ratio.
Cropping intensity - total cultivated area on a farm divided by the total cropland. ffien
reported as a percentage.
Cropping paitern - the area devoted to, and the sequence of, crops produced by a farmer
or in a region.
a Dividend - income distributed to shareholde;s of an enterprise,
a Domestic rsource cost - the cost in drff'rg;tic currency required to earn a unit of foreign
exehange through a proposed buciget. /
a Duty - a tax levied on an import
a Embargo - a complete prohibition against the import or export of a commodity.
a Farm budget - in farm investment analysis, a projection of the inflow and outflow of a fai'm
to estimate the incremental net benefit over the life of a project.
a Farm gate -'the boundary of a farm.
a Farm gate price - pr'lce a farmer receives for his product or pays for inputs at the boundary
of the farm - that is, the price without any transport to a market or other marketing seruice;
most commonly applied to outputs.
FOB (fre on board) prices - the price of an export loaded in the ship or other conveyance
that will carry.it to foreign buyers.

Fare$ ffia**gemtemt
W%E\X W*gt** EH * Ezgri*asltur*& #*p**wrlxz,# #*ar& &*v&*wd ?&at*ria&* X\i * t3
. FOB'shipping point - the seller will place the merchandise "free on board" on any means of
transport, anci the buyer musi pa.y transportation charges irom thai point. in mosi
merchandise transactions involving wholesalers or manufacturers, the buyer bears the
transportation cost. Sometimes however, the seller prepays the freight and adds this to the
amount bilied to the buyei'.
. FOB destination - the seller agrees to bear the freight costs of a merchandise. If the seller
prepays the carrier, the agreed terms have been met, and no action is required of the buyer
+l--^ Lv aa.,
trroil +a +l-ra s^-^^.t ^r +h^ rr +h^
Tf Lrrg aalla.
JEilgr ;aa-
uuEJ nn+
rrul ptEvay +ha rrai^h+
Froy Lrrc (2yrgEu ^,,-^h--^ ^-i^^ tr
PurLrr<r5c PrrLE LilE ^^^-l-
vvu\r-. LrrE rrEryilL,
the buyer will pay the carrier and deducts this payment from the amount owed the seller
when making payment for the merchandise purchased.
. Grace Beriod - in credit transactions, a period during which a borrower need not repay
principal and, sometimes, interest.
o Import substitute - an output of a project that replaces goods or seruices that would have
been impofted without the ploject.
. Interest - a payment y6" use of money, generally stated as a percentage of the amount
(principal) borrowed,z
a Simple interest - the interest paid in one period.
a eompound interest - is the interest paid not only on the amount borrowed but also on ihe
interest earned in previous periods.
Liquidity - the readiness by which an asset can be converted into cash; the ability to pay
debts as beeome due,
Long run - a time period so long that all factors of production can be varied; i.e. there are
no fixed costs anymore, all variable costs.
Marketing rnargin - the di,*ference behveen the price that consumei F3i/ foi'the final
production and the price received by the producers for the raw product; the difterence
between the price a buyer pays for ? good or service and the price at which he sells that
good or service. In general, eqya6 the cost of providing marketlng services nedded in a
relatively competitive market.,/
a Multiple cropping - growing more than one crop on the same area in a year,
a Mark-up pricing - price is determined by adding some fixed percentage to the unit cost;
most commonly found in the retail trades (groceries, furniture, clothing, jewelry, etc.) where
the retailer adds predetermined but different mark-ups to various gmds he carries.
p Point of first sale - the location where the firct sale transaction takes place for a product.
a Quotas - in reference to foreign trade policy, a quota is a limitation on the quantity of an
item thai may be imprted. Quotas restrict the amount of a commodity consumers can
purchase and thus, force consumers to pay a higher price. This action forces consumers to
swiieh to iess ejesirabie substituie eommodities, whiie domestic produeers of substitute
commodities expand their output under the quota protection, using resources drawn from
more efficient industries
V/ith respect to economic efficiency, quotas are much more harmful than tariffs in general.
With tariffs, the domestic price can never exceed that of the world price by more than the
tax. With a quota, any increase in domestic demand must cause the domestic price to rise
because the amount of imports cannot be increased. Thus, there is no llmit to the difference
that can exist between the doryestic and world price of the commodity.
Short run - a time periogffiere one or more of the factors of
production are fixed, /
a Solvency - having enough money to.pay debts as they fall due.
a Tariffs - a du$ or tax imposed on an import or an expoft; a schedule of charges of a
business, especially of a public utility, If an impoting country imposes a tariff, this tax is
partially passed on to consumers in the form of a price increase for the commodity.
Depending on the demand and supply for the commodity,, part of the tax is paid by the
consumers in the importing country in terms of higher prices, and paft is absorbed by the
e(Bofting eountry in terms of a lower worid priee.
Value added - the amount of econornic value generated by the activity carried on within
each production unit in the economy.

Farm &*n*W*ss**m*
W%&W&*sc*& EV * &gri*e.aEte*r*8 frrrgin*er$n# B*ard &*wa*wWawWrEaE* Wd " Ze
. Oomestic vatue'added - refers to the value added by local or domestic activities to
componenis importerl irom abroari.
. Value added tax - an indirect tax (also known as ad valorem fax) levied at the time of each
exchange of goods and seruices from primary production to consumption, generally stated as
a proportion of the vaiue arjcied at each stage of prociuction.

-
V. Sample Questions
EASY:
1. The person reponsible for helping the organization achieve its goal is called-'
a. Planner d. Leader
b. Organizer e. Developer
G..i, Manager f. None ofthe Above

Z. The management process by which managers think their through in acivance and where the
organization's mission, vision, goals and objectives are made is called
a. organizing d. controlling
b. staffing e. dire*inE
C;) planning f. leading

3. What is the ra+Jo of output over input?

a. planning d,,efficiency
b. effectiveness e. organizing
e, eontrolling f, none sfthe absve

4. It refers to the criltivation of land with or without the benefit of sound business, technical
knowledge and skills.
a. Farm Management d. Agriculture
bi Farming e. Land Management
c. Management f. None ofthe above

5. The fund collected by the government to.finance ib activities.

a. credit *. tax
b. enterprise e. interest
c. dividend f. None ofthe above

6. The term used when the Peso becomes cheaper compared to Foreign Currency'.
d.u, devaluation d. dividend

b. evaluation e. interest
c. depression f. None ofthe above :

7. What is the term used for the effective and efficient use of scarce resources to achieve
organizational goals?
a. Farm Management d..', Management
b. Organizing e. Agriculture
c. AgriculturalEconomics f. None ofthe above

8. It is the .process of management where managers coordinate the human and material
resources of the organization.
a. Planning d. directing
,h," Organizing e. controlling
c. Staffing f. leading

F*rm ?"*ana#ertgemt
PSAE &x6e*raTV * &gr'E**1ta*ra|Wrr6ir*@W*a;k*ria1e* EV * t*
-
@money,generallystatedasapercentageoftheamountorprincipaI
borroweci is caiied
a. duty d. capital
b. credit e. liquidity
e. diviciencl f.,none oi the above

10. This is also known as the ad valorem tax.

a.tax d. capital
b.value added tax e. duty
c.interest f. none ofthe above

1i. Which of the foliowing is not a managerial role :

a. mediator d. monitor
b. liaison e. none ofthe above
e. negotiator f. all oi the above

12. The ability to choose appropriate means of achieving a given objective is called
a. effectiveness d. economics
b. efficiency e. solvency
c. liquidity f, none ofthe above

13. Which of the foltowing is not a characteristic oi a manager:

a. responsible d, mediator
b. politician e. none of the above
e. deeision maker f . aii of the above

14. The aft of applying business and scientific principles to the organization and management of
fann business entlrprise for the purpose of securing the greatest continuous profit is called

a. Management d. Farm Economics

b. Scientific Method e."Farm Management
c. AgriculturalEconomics f. None ofthe above

tr5. The term used for the process Of management rivhere it is aimed at getting members of the
organization to move in the direction that will achieve its objectives.
a. Planning d, Directing

b. Organizing e, Controlling
c. Staffing f. Leading

n6. It is the income distributed to the shareholders of the enterprise.

a. Dividend d. Tax
b. interest e. credit
c.Capital f. None ofthe above

i7. The ierm used for growing moi.e than one erop on the sarne area in a yeai'.
a. Compact Farmingd.'Multiple Cropping
b. Extensive Farming e. Cropping Pattern
c. Intensive Farmingf. None of the above

18. A special science concerned' chiefly"with' the description and analysis of production,
distribution
and consumption:
a. Agriculture lrvanagement
b. Engineering /e\ Marketing

ftrr!: Ir{a**S*rm**fi
 W*"*t*rz ZV * &qra*,aal"tssra* *rag\****r\rzg Ward W.-*w?*w Ww**raa?*
Economics f. None ofthe above

19. The readiness by which an asset can be convefted into cash is termed as
a.
liquidity
t- a;1. ,a*;,,
d. cash flow
v, stJMtlLy E, O>5CL5
c. quick-acid test f. None ofthe above
1n Th^ t nraaacc af anc.'rina +ha+ aah,al an+irri+ian
gLLrvllrgJ ranfa.m +a nlrnnazl qLLrvrL|EJ.
4r.r. I ilc: tttcilag=t!tEilL HlvLg5S IJt Eil:'utilt9 Ltlql oLLugr LUlilurrrr LU PrqrIrEu ^-+ir,;+;ff

a. Planning d. Directing
b. Organizing e. Controlling
c, Staffing f. I eerlinn

MODERAlE:
1. Which of the following is not a classification of farm jobs?
a. Fieldwork d. outside work that can be delayed
b. calendar work e. all of the above
c. work for rainy days f. none ofthe above

2. Which of the following are the classes of risks in agriculture?

a. liquidity d. human factor
E, AlArKet eonoiErons c. Staternents a and e
c. insurance f, Statements b and d
2 Tha+ in nradr rr+ian nlhar *h:n l:nrl l:hnr
rsuvl , hr rildinac :nrlru
J, r rtoL .^,hiah
vvrlrLtt inalr rda
iltLtuuE anaz{c
lJvvuJ ^-^l^',arl
e r i rPrr,rIEu Ir r Pr vuuLLru! r uLr rEl Lr rcr ! lsl lu, uultuil lyJ cr
fences is called
a. inventory d. resources
b. assets e. all of the above
c. capital f. none ofthe above

4. Among the following statements, which are considered to be method/s of reducing risks in
agriculture?
a, insurance d. flexibility

b. Diversification e. all of the above

c. future contract f. none ofthe above

5. What is the prevailing ad valorem faxin the Philippines?

a. 5 percent d. 2 percent
b. 10 percent e. 20 percent
c. 20 percent f. none ofthe above

6. Vv'hat is the proeess by whieh a frm manager looics ahead to the future and eontemBlates
alternative courses of action for the farm?
a. Budgeting d, Farm Budget
h tra.m traannmira a
u. ! elllt LL9rrvrrILJ E. E:rm
I ettt! fDlanniaa
lerilUtr!,
c. Efficiency of Production f. None ofthe above

7. These are the economic !'esources owned by a business which are expected to benefit future
operations: ;

a. inventories d. networth
b. assets e, capital
c. liabilities f. none ofthe above
I

E
8. Which of the following is not a good reason for using Farm Plans?
i
i F*res* &4*er*Seffieffit
I

t
I

L
=-= ''"-
?S&**"*g1*rtTV*&gr1*w9t*cra|*.xg\re**r*ru*W*ar*B*ivi*w*4a**t\*&* W-!7
a. For review and analysis of objectives.
b. Serve as a centrai iaciiiiaiing aid.
c. Provide a basis for evaluation and improvement. --
d. Serve as a yardstickfor peformance and evaluation
e. Ail or tne aDove
t. None ofthe above
O Th^ f^ll^..,i6^ --^
giE 5ll af n'nna' * avaanl
gALqpL
I ilE lL.riluYvrllg ell Pt(,LcJJcS rJr PruPEr ilrclrroYcril=rrL/
=.
a. Planning d. Organizing
b. Leading e. Controlling
c. Pracractin:finn f" None ofthe above

10. Which of the following statements is not a good labor management practice.
a.
Planning a labor calendar.
b.
Providing social life and giving out bonuses and profit sharing, to enhance productivity.
c.
Doing everything there is to do in order to save the rainy days for resting,
d.
Developing initiative, goodwill, cooperation and respect.
e. Cut chore iabor to a minimum. Aiso, simplify ancl combine jobs whenever possibie.
t.
Taking extra care in directing inexperienced labor.

1i. Vfhieh aftiong the foiiowing isiare not functions oi farm manaEement
a. Keeping records and accounts.
b.
.J
Controlling and directing the various resources.
Mrnraina
I'lqtlggllly l=hn.
lgUU!, lanrl =nrl r:ni*:l
l0l!u CllU LGHILS!,
'd.
,F\
Overseeing the entire production process.

e. All ofthe above.

qf. None ofthe above.

12. The classes of risks in agriculture results from:

a.Human factors d. Statements b, and c
/b.Liquidity e. All of the above
c.Natural factors t'lone of the above(
i3. This involves planning the procurement anci utilization of funds and controlling the financiai
operations to insure effective utilization of funds.
a. Farm Budget d. Farm Planning
X i"'iarketing l"ianagement e. Production i"ianagement
,1c. Financial Management f. None of the above

14. VJhich of the following is not a function of management?

a. Controlling and directing the various resources
b. Management of labor
c. Methods of reducing risks in agriculture
d, Farm records
e. Management of capital
f. None ofthe above
15. in financial analysis, what is the idealcurent ratid
a. 1:1 d.2:t
b. 5:1 e. ali of the above
c. 2:2 f. none ofthe above

i6. A Brojeetion of the eash inflow aRd outfiow of a farm to estimate the inerementai nei benefit
over the life of the project is called

far*: M**ag*nr*xt
 PSAE Rign lV - &*rc*r-al;tz*ra1 n**rarag Ward W*wi*:*s ?&afu*rr.wii* EW-Z&
* Farm Budget d. Solvency
L
U, Financial Fianagement e. Liquidiiy
c. Farm Planning f, None ofthe above
-1 ,- tt
J,^', tL is the eosi outiay of the firm for the wear and tear of maehines, buiirlings and imBiements,
a. hedging d. revenue
b. credit e. depreciation cost
discount rate f.none ofthe above

18. What is the term used for the amount of funds available for payment at any given time?
a. Current assets d. Accounts receivables
b. Net working capital e. Capital
c. Net worth f. None ofthe above
19. Vrlhich of the foliowing is not a method of valuation of inventory?
a. original cost d. present market value
b, original cost less depreciation e. all of the above
e, normai market value fr Fon sf the above
20. What is the "book value of an asset?"
a. A tax levied on an import.
b. The value of an asset after subtracting depreciation
c. Also called as the'net benefit.' .

d. The exchange vaiue oi goods or services in terms of money,

A All of the above
f. None of the above

DIFFICULT:

1. Which of the follo:*,,ing statement/s is/are true?

a. A person must be efficient to be effective.
b, A person may be effective without being efficient.
C. A. person must be effective to be efficient.
d. A person may be efficient without being effective.
A
Statements a and c
f. Statements b and d

2. Among the following statements, which demonstrates efficiency in operations?

a. Reducing the number of workers while maintaining the same target yield.
b. Increasing the number of workerc while maintaining the same targef yielci.
c. Increasing the target yield and maintaining the number of workeri.
d. Reducing the number of workers and reduiing the target yierd.
g. inereasirrg the number of workers ancj inereasing the target yieici.
t. Statements a and c.

2 The study' of the uraie and, means of organizing land, labor and capital and the applicetion
of
technical knowledge and skill in order: that the farm may be made to yield the maiimum
net
returns is called
a. Management d. Farm Management
b. Economics e. Agricultural Economics
c. Scientific Method f. Agricultural. Mechanics

4. A farmer's success is dependent on several factorsl of which are:

Fa sxtr n**d ca*heim?ec*

76eX ?** EV * &gri*a^;Ekaarwi W*#trz*@
a. Proper selection of farm type and size based on the availabl,
tB-
resources. rt)
b. Age, strength, maturity and his ability to communicate well in En5
c. Giving dul impotance to land and water conservation and
trarrsietions oi the farm.
hgt
d. Planning the best layout of the farm and providing provisions of ,

irrigation and other farm requirements.

c Statements a, c, d.
f. Statements a, b, d.
rI
5. A.rr"ange the following according to the p!'ocess of management' T
i. Selecting the right employees for the right position
ii. Formulation of ine mission, vision, goals, objectives and activities of the organization
iii. conducting of annual peformance evaluation of employees.
iv. Coordinating the employees and material resources of the organization.
v. Orientation bf personnel for the proper achievement of goals.

a. i, ii, iii, iv, v d. ii, iv, I, iii, v

b. ii, i, v, iv, iii e. all of the above
c. ii, iv, I, v, iii f. none ofthe above

What is the depreciation factor per year of a hand tractor that is bought at P150,000.00,
if it
has no more value at the end oi the fifth year?
a. 25,0C0 pesos/year d. 30,0CC pesos/'Year
b. 60,000 pesos/year e. 17,500 pesos/year
c. 15,000 pesos/year f. none ofthe above

7. Given: Total Current Assets = P200,000.00

Total Inventories =P 50,000.00
Total Fixed Assets = P500,000'00
Total Current Liabilities = P125,000'00
Total Long-term Liabilities= P185,000'00
Total Net wotth = P 100,000'00

What is the current ratio for the given data?

a. 1.0 d. 1.5
b. Z,U e. i.6
c. 7.4 f. none ofthe above
quick/acid=test ratio?
8. Fr-om the given data in #7, what is the result using the
d. 1.0 d. 1.3
e. 1.1 e. 1.4
f. 1.2 f. none ofthe above
at 60,000 Pesos' if
9. What is the depreciation factor per year, of a hand tractor that is bought
it has no more value at the end of the fifth year?
a. pesos/year
5000 d. 2,500 pesos/year
b. 10,000pesos/year e. 12,000 peos/year
a. 6obo pesos/v# f. none ofthe above

10.Whatisthehandtractor,sbookvalueafter3years?
a. 48,000 pesos d. 42,000 pesos
h L2,000 pesos e. 24,000 peos
c. 36,000 pesos f. none ofthe above"

*arr* W**xg*xwe:rsq.