FIFTEENTH ANNUAL YEAR BOOK— PART X 



695 



titles of feed, produce, and supplies on hand; growing crops (value of 

 labor and materials already spent for next year's crops); cash on hand 

 and in bank; and bills receivable. The total of all these should be 

 found and the mortgage and bills payable, if any, subtracted from it. 

 The difference is what the farmer is worth above debt, or his present 

 net worth. 



In estimating values, the market price at the farm, or the price at 

 the selling place minus the cost of hauling to market, should always 

 be the standard. The value put upon anything should be what it is 

 thought can be obtained for it at a normal sale and should neither be 

 overrated nor underrated. In either case, one is fooling only one's self. 

 It is better to be fair and unprejudiced and use one's best judgment. 



Table I. — A sample summary of (in inventory} 



Item 



Farm, 200 acres (including- buildings) 



Cows: 



20 head at .$60 



15 head at $70 



Horses, 6 



Machinery 



Feed and supplies 



Growing crops (cost of labor and materials). 



Cash 



Bills receivable - 



Total resources 



Mortgages and bills payable 



Net worth 

 Gain for the year 



Mar. 1, 1912 



$8,000 

 1,200 



900 

 783 

 1,100 

 110 

 97 

 75 



12,265 

 3,125 



9,140 



767 



$ 9,907 



Mar. 1, 1913 



$8,000 



1,050 

 850 

 80O 

 850 

 125 

 437 

 95 



12,207 

 2,300 



$ 9,907 



$ 9,907 



^In the complete inventory each cow, horse, and machine is listed separately. 



The form in Table I is presented here as a suggestion as to the way 

 in which the inventory may be classified and summarized after two in- 

 ventories are completed. 



If preferred, the inventories may be kept on pages by themselves in 

 the financial record book and the entering of inventory values to the 

 individual accounts may be deferred until both inventories are complete 

 and the accounts are being closed at the end of the year. The method 

 of entering these amounts is given under "Closing the accounts at the 

 end of the year." 



No other account will give so much information for the time and 

 labor expended as the annual inventory. By comparing the net worth 

 as shown by the current inventory with the net worth shown by that 

 of the previous year, the farmer can tell whether he has made a gain 

 or loss and how much, after paying from farm receipts what he has ex- 

 pended for the living expenses of the family. 



If money has been added to or taken from the business by gifts or 

 by transfer from some other business that is not included in the in- 

 ventory, these items would have to be known in order to tell the gain 

 or loss. Usually the farmer lists all his property in the inventory, so 

 that there is no chance for such an error. He may have only a small 



