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Define production cash flow

FRP
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Diane Steyn
on 6/21/17, 1:55 PM 106 views
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Diane Steyn

--Diane Steyn--
Agrista (Pty) Ltd
http://www.agrista.com
2117
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--Diane Steyn--
Diane Steyn
On 6/21/17, 1:55 PM

Define Enterprises tool

Use the Define Enterprises tool to capture the farm’s production income. Refer to rows 8-18 and columns A-H of the Cash Flow Model spreadsheet:

 

A farm’s production income and expenses are calculated from the budgets applied to the land components.

 

It is important to note the following:

  • you can’t use this tool until you have defined the farm’s land use

  • the closer your budgets match your client’s income and expenses the easier it will be

  • The production costs are calculated at the time a budget is applied to a FRP. If the data in the budget is changed at a later date it will not automatically update the calculation in the FRP

This tool combines the land components with the budgets you have prepared. Each land component can have one or many budgets applied to it to forecast the customer's expected production cash flow.

  1. Select Define Enterprises from the Toolbox menu. The system will automatically list the land components created in the previous step.

  2. Move the blue time marker in the timeline to add budgets to Year 1

  3. Click the Plus button to apply a budget to a land category, i.e crop budgets to cropland and livestock budgets to grazing. A list of available budgets will appear in the drop down list.

  4. Select a budget from the list and edit the applied area. As a default the system will apply the budget to the total size of the land component. You can also edit the income assumptions pulled through from the budgets if necessary.

  5. Move the blue time marker in the timeline to add budgets to Year 2 of the FRP and repeat.

  6. Click Save

 

Livestock sales will pull through from the budget, but additional breeding stock figures can be added by selecting them from the Commodity drop down list.

The Cash Flow graph will update in the Summary tab as well as the Production Income and Production Expense tables in the Income & Expense tab

   

This is where discrepancies from the budget will start to appear. For example, the crop income from Year 1 seems to be allocated to Year 2 in the above screenshot. The timing of the crop income is defined in the applied budget. We can correct this using the Edit Production Costs tool as described in the next section.  

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Asked: 6/21/17, 1:55 PM
Seen: 106 times
Last updated: 7/7/17, 10:04 AM