2008 DISTRICT FFA FARM MANAGEMENT CONTEST
Multiple Choice Section
The Farm Management Contest is designed to test student
understanding of the application of economic principles in farm
management. Each question is worth three (3) points.
Choose the best answer and mark the appropriate box on the score
sheet provided. There is only one correct answer to each
question. Answers have been rounded.
1. Corn has an expected yield of 150 bushels per acre and a
production cost of $300.00 per acre. Expected market prices
are $5.00 per bushel for corn and $13.00 per bushel for
soybeans. Soybeans can be raised at a production cost of
$150 per acre. At what breakeven yield per acre would
soybeans generate the same net return per acre as corn?
A. 46.2 bushels
B. 48.6 bushels
C. 53.6 bushels
D. 57.9 bushels
E. None of the above
2. A farmer sold his 5000-bushel wheat crop at several
different times during the year. He sold 1000 bushels at
$5.00, 2000 bushels at $5.25, and 2000 bushels at $7.00.
What was his average price per bushel?
A. $5.25
B. $5.75
C. $5.90
D. $6.01
E. None of the above
3. The self-employment tax rate for Medicare is
A. 1.45%
B. 2.90%
C. 5.30%
D. 7.65%
E. None of the above
4. The maximum amount that can be claimed as a Section 179
expense deduction on your 2007 tax return is
A. $17,500.
B. $100,000.
C. $105,000.
D. $125,000.
E. None of the above
5. The maximum annual contribution to an IRA is $4,000 per
person for someone under age 50 and ___________ for
someone age 50 or older.
A. $2,000
B. $5,000
C. $7,500
D. $8,000
E. None of the above
6. By contributing the maximum amount to a Roth IRA, a 40-
year-old farmer will reduce his taxable income by
A. $0.
B. $2,000.
C. $3,000.
D. $3,500.
E. None of the above
7. The own-price elasticity of supply estimates the impact on
the quantity of a good supplied by a change in the price of
the good. Normally, one would expect the own-price
elasticity of supply to be
A. positive.
B. negative.
C. zero.
D. None of the above
8. The term "exchange rate" refers to
A. how much of one currency is needed to acquire a
unit of another currency.
B. how much principal is reduced by payments on an
amortized loan.
C. the ratio between current and long-term debt.
D. the difference in value between a dollar today
and a dollar one year from today.
E. None of the above
9. A procedure for expressing future cash flows in today's
dollars is called
A. compounding.
B. discounting.
C. deflating.
D. inflating.
E. None of the above
10. Farmer Brown has a debt-to-asset ratio of 53%. His debt-to-
equity ratio must be
A. negative.
B. 47%.
C. Less than 100%.
D. Greater than 100%.
E. None of the above
11. The "rule of 72" says to divide 72 by the annual interest
rate to estimate the number of years needed for an initial
investment earning that rate to double. How long would it
take for $1 earning 9% a year to grow to $4?
A. 16 years
B. 24 years
C. 32 years
D. 48 years
E. None of the above
12. For an amortized loan, the present value of the loan
payments discounted at the loan's interest rate is equal to
A. the amount of money borrowed.
B. the number of payments times the payment amount.
C. total interest paid over the life of the loan.
D. the size of the annual payment.
E. None of the above
13. On April 1, 2007, Sue borrowed $35,000 to plant corn. On
November 1, 2007, she repaid the loan along with $1,734.37
interest. What annual interest rate did she pay?
A. 6.94%
B. 8.49%
C. 9.75%
D. 10.41%
E. None of the above
14. A $50,000 loan amortized at 8% interest for 20 years yields
annual payments of $5,092.61. How much of the first year's
payment is principal?
A. $1,092.61
B. $1,700.00
C. $2,592.61
D. $4,000.00
E. None of the above
15. For the above loan of $50,000, if the 20th and final payment
includes $377.23 of interest, what was the outstanding
principal balance after the 19th payment?
A. $5,688.07
B. $4,715.38
C. $4,622.77
D. $377.23
E. None of the above
16. A feedlot operator purchases a pen of 43 feeder steers with
an average weight of 703 pounds and sells them at an average
weight of 1181 pounds. Total feed cost for the pen is
$16,634. Feed cost per pound of gain is equal to
A. $0.515
B. $0.649
C. $0.733
D. $0.809
E. None of the above
17. A hectare equals
A. 0.40 acres
B. 1.74 acres
C. 2.47 acres
D. 5.05 acres
E. None of the above
18. How many total acres are included in the "S 1/2 of the NE
1/4 and the NW 1/4 of the SE 1/4 of Section 15, Twp. 10N,
R4W of the 5th Principle Meridian"?
A. 80 acres
B. 120 acres
C. 160 acres
D. 240 acres
E. None of the above
19. How much perimeter fence would be required to completely
enclose the parcel of land described in the question above?
A. 1.5 miles
B. 2.0 miles
C. 2.5 miles
D. 3.0 mile
E. None of the above
20. If dried distillers grain has 10% moisture and sells for
$180 per ton, what would be the nutrient equivalent price
for wet distillers grain which has 65% moisture?
A. $42.00 per ton
B. $46.67 per ton
C. $55.56 per ton
D. $70.00 per ton
E. None of the above
21. You must use the mid-quarter convention of depreciation
if more than what percent of 3-, 5-, 7-, 10-, 15-, and
20-year property is acquired in the fourth quarter?
A. 33%
B. 40%
C. 50%
D. 65%
E. None of the above
22. A farmer is "liquid" if
A. he has sufficient current assets to cover current
debts.
B. he has sufficient equity to cover current debts.
C. he has sufficient assets to cover all debts.
D. he can pay all debts with all equity.
E. All of the above
23. You buy seed beans having 2560 seeds per pound. The
directions state to drill at the rate of 3 beans per
foot with a 7-inch spaced drill. How many 50-pound
bags will you need for a 40-acre field? (There are
43,560 sq. ft. in an acre.)
A. 34 1/2 bags
B. 51 bags
C. 61 1/2 bags
D. 70 bags
E. None of the above
24. Herbicide is usually applied to weeds and grasses
around the farmstead as a 2% solution. How many ounces
of herbicide should be added to a 2 1/2 gallon sprayer to
make a 2% solution?
A. 2.0 ounces
B. 5.0 ounces
C. 6.4 ounces
D. 10.3 ounces
E. None of the above
25. When a farmer borrows money to purchase land, he
usually must offer the title to the property as
security until the debt has been repaid. This credit
instrument is commonly referred to as a
A. sales contract.
B. promissory note.
C. mortgage.
D. check.
E. None of the above
26. A decline in the value of total farm assets will
A. increase the rate of return to equity.
B. increase the rate of return to assets.
C. increase the capital turnover ratio.
D. all of the above.
E. None of the above
27. The increase in wheat yield becomes smaller for each
additional 10 pounds of nitrogen fertilizer applied
after 30 pounds per acre have been applied. This is an
example of
A. increasing marginal returns.
B. unprofitable use of fertilizer.
C. diminishing marginal physical product.
D. stage 3 of production.
E. None of the above
28. Which of the following causes a shift in the demand for
beef?
A. A decrease in cattle numbers
B. Increased cost of producing beef
C. Increased number of cattle producers
D. Increased income of consumers
E. All of the above
29. The cost of producing one additional unit of output is
called
A. opportunity cost.
B. substitution cost.
C. average cost.
D. marginal cost.
E. None of the above
30. A farmer has total assets of $600,000 of which land is
$300,000. The farmer's debt:equity ratio is 1.0. What will
the farmer's debt:equity ratio be if the land goes up in
value by 20%?
A. 0.66
B. 0.80
C. 0.83
D. 1.20
E. None of the above
31. Purchase of a Call option on corn means the buyer
A. is required to sell a corn futures contract at a
set price.
B. may sell, but is not required to sell, a corn
futures contract at a set price.
C. may buy, but is not required to buy, a corn
futures contract at a set price.
D. is required to buy a corn futures contract at a
set price.
E. None of the above
32. If the price of a September Put option is higher today than
yesterday, then one would expect that the price of a
September futures contract is
A. higher today than yesterday.
B. lower today than yesterday.
C. unchanged from yesterday.
D. either up or down. There is no
relationship between futures prices
and prices of options.
E. None of the above
33. A soybean producer decides to store his soybeans in the
local elevator for 4 months. The price at harvest is $9.00
per bushel and the elevator charges 2 cents per bushel per
month for storage plus a 5 cent per bushel handling charge.
He has 4,000 bushels to sell and must borrow $36,000 at 8%
annual interest while he stores the soybeans. What price
must he receive for his soybeans to break even and cover his
storage and opportunity costs?
A. $9.31
B. $9.37
C. $9.53
D. $9.85
E. None of the above
34. How many pounds of 44% protein supplement must be mixed with
8% protein corn to make a ton of 16% protein feed?
A. 222 pounds
B. 400 pounds
C. 444 pounds
D. 600 pounds
E. None of the above
35. During the year, a farmer pays $1,800 principal and $500
interest on a tractor loan. His annual depreciation is
$1,500. His deductible operating expenses (fuel, oil,
repairs, etc) associated with operating the tractor totaled
$500. His marginal tax rate is 30%. What is his after-tax
cash cost of using the tractor for the year?
A. $ 750
B. $1,900
C. $2,050
D. $3,600
E. None of the above
36. The price of widgets changes from $60 to $50 and, as a
result, the quantity demanded increases from 90 to 100
units. From this we can conclude that
A. the demand for widgets is elastic.
B. the demand for widgets is inelastic.
C. the demand for widgets is of unit elasticity.
D. the demand for widgets has declined.
E. None of the above
35. A firm should shut down in the short-run if it cannot
cover its
A. fixed costs.
B. total costs.
C. variable costs.
D. time costs.
E. overhead costs.
38. If the total cost of producing 100 units of output is $500
and the average variable cost is equal to $1, then which of
the following statements is true?
A. Total variable cost of the 100 units is $400.
B. Total fixed cost is equal to $100.
C. Average fixed cost is equal to $4.
D. Average total cost is equal to $4.
E. None of the above is true.
39. An increase in total operating costs of $20 per acre will
increase the break-even price of the crop by how much if the
yield is 100 units per acre?
A. $0.02 per unit
B. $0.20 per unit
C. $2.00 per unit
D. $20.00 per unit
E. None of the above
40. How many bushels of corn are in a metric tonne?
A. 33.3
B. 35.7
C. 36.7
D. 39.4
E. None of the above
----------------------------------------------------------------
2008 DISTRICT FFA FARM MANAGEMENT CONTEST
Problems Section
Choose the best answer and mark the corresponding numbered space
on the answer sheet. Computations may be done in the margins or
on the back of the paper. Each question is worth four (4)
points. There is only one correct answer for each question.
Answers have been rounded.
PROBLEM I - Market Value Balance Sheet
Using the information below, complete the net worth statement for
January 1, 2008:
Land . . . . . . . . . . . . . . . . . . . . . . . . $1,470,000
House . . . . . . . . . . . . . . . . . . . . . . . 110,000
Machinery and equipment. . . . . . . . . . . . . . . 285,000
Cows . . . . . . . . . . . . . . . . . . . . . . . . 43,000
Calves . . . . . . . . . . . . . . . . . . . . . . . 12,000
Accounts payable . . . . . . . . . . . . . . . . . . 5,100
Autos. . . . . . . . . . . . . . . . . . . . . . . . 41,000
Sows and boars . . . . . . . . . . . . . . . . . . . 17,000
Market hogs . . . . . . . . . . . . . . . . . . . . 35,000
Checking and savings . . . . . . . . . . . . . . . . 16,090
Corn . . . . . . . . . . . . . . . . . . . . . . . . 59,000
Hog buildings . . . . . . . . . . . . . . . . . . . 40,000
Feed and hay . . . . . . . . . . . . . . . . . . . . 4,000
Accounts receivable. . . . . . . . . . . . . . . . . 500
Accrued interest owed. . . . . . . . . . . . . . . . 40,060
Accrued taxes owed . . . . . . . . . . . . . . . . . 9,500
30-year land loan balance is $552,000.
$24,950 plus interest is due March 1 of each year.
7-year combine loan balance is $12,129.
$3,971 plus interest is due November 30 of each year.
15-year home loan balance is $52,800.
$500 plus interest is due each month.
Current Assets: Current Liabilities:
_______________________________ ______________________________
_______________________________ ______________________________
_______________________________ ______________________________
_______________________________ ______________________________
_______________________________ ______________________________
_______________________________ ______________________________
_______________________________ ______________________________
_______________________________ ______________________________
_______________________________ ______________________________
Total ____________ Total ____________
Non-current Assets: Non-current Liabilities:
_______________________________ ______________________________
_______________________________ ______________________________
_______________________________ ______________________________
_______________________________ ______________________________
_______________________________ ______________________________
_______________________________ ______________________________
_______________________________ ______________________________
_______________________________ ______________________________
Total __________ Total __________
Total Assets _______________ Total Liabilities ____________
Net Worth ______________
Questions 1 through 7 refer to PROBLEM I
1. The total value of current assets on January 1, 2007, was
A. $79,450
B. $114,950
C. $126,450
D. $126,590
E. None of the above
2. The total value of non-current assets was
A. $1,946,000
B. $1,989,000
C. $2,006,000
D. $2,053,000
E. None of the above
3. The total value of current liabilities was
A. $54,660
B. $80,680
C. $84,081
D. $89,581
E. None of the above
4. The total value of non-current liabilities was
A. $582,008
B. $585,909
C. $587,508
D. $616,929
E. None of the above
5. The net worth was
A. $1,201,640
B. $1,264,001
C. $1,426,080
D. $1,466,501
E. None of the above
6. The current ratio was
A. 0.71
B. 1.41
C. 1.51
D. 3.18
E. None of the above
7. The net working capital was
A. $37,009
B. $42,509
C. $126,590
D. $1,461,001
E. None of the above
PROBLEM II -- Enterprise Budget
Use the dairy cow budget below to answer Questions 8
through 16.
DAIRY COW REPLACEMENTS IN 100 COW HERD
22,000 pounds of milk sold per year per cow unit
39% replacement rate
Operating Inputs Units Price Quantity Value
Gov Dvsrn asses Cwt 0.05 220.00 11.00
Promotion assess Cwt 0.15 220.00 33.00
Milk hauling Cwt 0.70 220.00 154.00
Dairy ration, 16% Cwt 17.00 98.70 1677.90
Hay Tons 130.00 5.59 726.70
Salt & minerals Lbs 0.15 130.00 19.50
Milk replacer Lbs 0.80 5.00 4.00
Calf starter Lbs 0.15 50.00 7.50
Pasture AUMS 18.00 3.48 62.64
Breeding fees Dol 45.00 1.00 45.00
Vet medicine Dol 100.00 1.00 100.00
Supplies Dol 39.00 1.00 39.00
Accounting Hd 18.00 1.00 18.00
Utilities Dol 47.00 1.00 47.00
Machinery labor Hr 12.00 10.69 128.28
Equipment labor Hr 12.00 6.27 75.24
Livestock labor Hr 12.00 43.40 520.80
Mach fuel, lube, repair 150.11
Equip fuel, lube, repair 27.74
Total Operating Costs 3847.41
____________________________________
Fixed Costs Amount Value
Machinery
Interest @ 8% 519.00 41.52
Depr, taxes, insurance 64.98
Equipment
Interest @ 8% 634.00 50.72
Depr, taxes, insurance 80.22
Livestock
Dairy cow 1800.00
Dairy heifer 900.00
Dairy repl. heifer 500.00
Interest @ 8% 3200.00 256.00
Total Fixed Costs 493.44
Total Costs 4340.85
______________________________________
Production Units Price Quantity Value
Milk Cwt 18.00 220.00 3960.00
Dairy cows Cwt 50.00 4.44 222.00
Dairy bull calf Hd 105.00 0.48 50.40
Dairy heifers Cwt 90.00 0.20 18.00
Total Receipts 4250.40
_______________________________________
Returns above total operating costs 402.99
Returns above all specified costs -90.45
_________________________________________________________________
8. Total operating cost per cow is:
A. -$90.45
B. $402.99
C. $3,847.41
D. $4,250.40
E. None of the above
9. The return above total operating cost per cow is:
A. -$90.45
B. $402.99
C. $3,795.99
D. $4,200.00
E. None of the above
10. How many hours of labor are budgeted per cow?
A. 10.69
B. 43.40
C. 60.36
D. 260.40
E. None of the above
11. What is the total budgeted interest cost per cow?
A. $41.52
B. $92.24
C. $348.24
D. $4,353.00
E. None of the above
12. If each cow is milked for 305 days, how many pounds of milk
are given per cow per day on average?
A. 8.46
B. 12.90
C. 65.57
D. 72.13
E. None of the above
13. What price per pound is paid for hay?
A. 2.66 cents
B. 4.75 cents
C. 5.59 cents
D. 6.50 cents
E. None of the above
14. What is total feed cost per cwt. of milk?
A. $10.93
B. $11.36
C. $12.49
D. $18.00
E. None of the above
15. What price of milk will cause the returns above all budgeted
costs to equal zero?
A. $16.17/cwt.
B. $17.59/cwt.
C. $18.41/cwt.
D. $19.36/cwt.
E. None of the above
16. If interest rates rise by 1 percentage point, how much will
total cost of production increase?
A. $0.02 per cwt. of milk
B. $0.10 per cwt. of milk
C. $0.20 per cwt. of milk
D. $0.42 per cwt. of milk
E. None of the above
PROBLEM III -- Income Tax Management
Use the tables at the end of this exam to calculate depreciation
on the following item.
On May 1, 2007, Mark bought a new tractor. Mark traded his old
tractor which had a remaining book value of $2,610. Mark paid
$15,000 "down" and financed the remaining $25,000 over 5 years at
8% interest. He elected to roll the remaining basis of his old
trctor into the new one.
17. The tractor is
A. 3-year property
B. 5-year property
C. 7-year property
D. 10-year property
E. None of the above
18. If Mark does not expense any of the cost of the tractor,
then 2007 depreciation will be (use regular MACRS and mid-
year convention)
A. $535.70
B. $1,886.74
C. $4,285.60
D. $4,565.24
E. None of the above
19. If Mark expenses $15,000 of the tractor cost and uses the
mid-quarter convention and regular MACRS, then 2007
depreciation will be
A. $2,218.74
B. $2,958.14
C. $3,697.81
D. $5,176.87
E. None of the above
20. If Mark expenses the maximum allowable on the tractor and
uses regular MACRS with the mid-year convention, then 1/1/08
remaining book value will be
A. $0
B. $1,886.74
C. $2,330.36
D. $24,651.86
E. None of the above
21. If Mark does not claim an expense deduction and uses the
mid-year convention and straight line depreciation over
the alternate MACRS life, his 2007 depreciation will be
A. $380.50
B. $1,130.50
C. $2,130.50
D. $2,261.00
E. None of the above
22. Under MACRS, a livestock fence is classified as
A. 7-year property
B. 10-year property
C. 15-year property
D. 20-year property
E. None of the above
PROBLEM IV -- Supply and Demand
2008 District FFA Farm Management Graph for Exam
The above graph represents supply of apples for import into
the U.S. (SF) the supply of apples produced in the U.S. (SUS),
the total supply of apples in the U.S. (ST), the foreign
demand for U.S. apples (DF), the domestic demand for apples
(DUS), and the total demand for apples (DT) in the U.S.
23. What is the market equilibrium price of apples in the
U.S.?
A. P1
B. P2
C. P3
D. P4
E. None of the above
24. At the market equilibrium price, how many apples will be
exported from the U.S.?
A. Q1
B. Q2
C. Q3
D. Q4
E. Q5
25. At the market equilibrium price, how many apples will be
imported into the U.S.?
A. Q1
B. Q2
C. Q3
D. Q4
E. Q5
26. At what price would apple imports equal apple exports?
A. P1
B. P2
C. P3
D. P4
E. None of the above
For questions 27 and 28, assume the value of the U.S. dollar
strengthens with respect to the currency of our major apple
trading partners.
27. The change will cause the U.S. apple imports to
A. increase.
B. decrease.
C. not change.
D. None of the above
28. After the dollar strengthens, the U.S. equilibrium price
of apples should
A. increase.
B. decrease.
C. stay the same.
D. None of the above
PROBLEM V - Marketing
In January, a farmer has 7,000 bushels of soybeans in the bin.
He sells the beans on April 8. Ignore commissions, storage
cost, and interest.
January 5 quotes: April 8 quotes:
May futures price = $12.85 May futures price = $14.05
Expected basis = $0.25 under Basis = $0.55 under
the Board the Board
Strike -May Premiums- -May Premiums-
price Call Put Call Put
$12.60 $0.78 $0.50 $1.75 $0.11
$13.00 $0.75 $0.71 $1.65 $0.14
$13.40 $0.60 $0.96 $1.50 $0.35
$13.80 $0.40 $1.25 $1.30 $0.50
$14.20 $0.18 $1.57 $1.02 $0.75
29. What is the cash price of soybeans on April 8?
A. $12.60
B. $13.50
C. $14.05
D. $14.60
E. None of the above
30. If the farmer sold one 5,000-bushel futures contract on
January 5 and bought back the contract on April 8, what
would be the average realized price per bushel (cash +
net on futures) for his 7,000 bushels of soybeans?
A. $12.30
B. $12.64
C. $13.50
D. $13.84
E. None of the above
31. If the farmer sold two 5,000-bushel futures contracts on
January 5 and bought both back on April 8, what would be
the average realized price per bushel (cash + net on
futures) for his soybeans?
A. $11.79
B. $12.30
C. $12.64
D. $13.50
E. None of the above
32. If the farmer bought one 5,000-bushel $13.40 Put on
January 5 and sold the Put on April 8, what would be the
average realized price per bushel (cash + net on options)
for his soybeans?
A. $12.30
B. $12.89
C. $13.06
D. $13.94
E. None of the above
33. If the farmer bought two 5,000-bushel $13.40 Puts on
January 5, and sold the Puts April 8, what would be the
average realized price per bushel (cash + net on options)
for his soybeans?
A. $12.63
B. $12.89
C. $13.06
D. $13.50
E. None of the above
34. If the farmer sold his beans on January 5 for $12.50 per
bushel and bought one 5,000-bushel $13.40 May Call, then
sold the Call on April 8, his average realized price per
bushel (cash + net on options) would be:
A. $13.14
B. $13.40
C. $13.50
D. $14.14
E. None of the above
PROBLEM VI - Inflation
The table below shows average nominal commodity prices and the
Consumer Price Index (1967=100) for various years. Use this
data to answer questions 35-37.
Year CPI Corn Hogs Steers Oil
$/bu. $/cwt. $/cwt. $/barrel
2007 621.1 3.39 42.08 91.82 72.34
2005 585.0 1.96 46.62 87.28 56.64
2000 515.8 1.82 42.41 69.65 26.73
1998 488.3 2.43 31.82 61.47 10.87
1996 469.9 3.24 53.40 65.21 18.46
1990 391.4 2.36 54.55 77.40 20.03
1985 322.2 2.62 44.50 58.37 24.09
1975 161.2 3.02 48.32 41.89 7.67
1970 116.3 1.16 21.95 29.36 3.18
1967 100.0 1.24 19.37 25.29
1965 94.5 1.17 21.30 24.99
1960 88.7 1.04 15.96 25.09
1955 80.2 1.43 15.19 22.16
1950 71.1 1.24 18.52 28.88
35. What price would steers have needed to be in 2007 to have
the same inflation adjusted price as in 1990?
A. $89.71
B. $112.88
C. $122.82
D. $130.45
E. None of the above
36. Adjusted for inflation, corn prices were highest in which
of these years?
A. 1950
B. 1955
C. 1975
D. 1996
E. 2007
37. Adjusted for inflation, hog prices were lowest in which
of these years?
A. 1955
B. 1970
C. 1985
D. 1998
E. 2007
PROBLEM VII - Financial Analysis
Bill Blackacre is a cash basis taxpayer. His farm records for
2007 show the following:
2007 Farm Sales $166,976
2007 Interest Paid 6,295
2007 Net Farm Profit 37,801
2007 Depreciation 40,560
2007 Loss in Inventory 29,800
1/1/08 Total Assets 912,689
1/1/08 Total Liabilities 100,972
38. Bill's capital turnover rate (sales plus inventory change
divided by assets) is
A. 4.14%
B. 15.03%
C. 21.56%
D. 30.82%
E. None of the above
39. Bill's net farm profit does not include a charge for his
own labor (which he values at $20,000 per year). Bill
will have to pay self-employment taxes on
A. $17,801.
B. $20,000.
C. $37,801.
D. $57,801.
E. None of the above
40. Bill's operating margin (profit plus inventory change) as
a percent of volume of production was
A. 3.17%.
B. 4.79%.
C. 5.83%.
D. 15.03%.
E. None of the above
ANNUAL DEPRECIATION PERCENTAGES FOR 5-YR PROPERTY, 150% DB
_________________________________________________________________
MID-QUARTER CONVENTION
Tax MID-YEAR Quarter placed in service --
Year CONVENTION 1 2 3 4
1 15.000% 26.250% 18.750% 11.250% 3.750%
2 25.500 22.125 24.375 26.625 28.875
3 17.850 16.520 17,062 18.637 20.212
4-5 16.660 16.520 16.763 16.567 16.404
6 8.330 2.065 6.287 10.354 14.355
Total 100.000 100.000 100.000 100.000 100.000
_________________________________________________________________
ANNUAL DEPRECIATION PERCENTAGES FOR 7-YR PROPERTY, 150% DB
_________________________________________________________________
MID-QUARTER CONVENTION
Tax MID-YEAR Quarter placed in service --
Year CONVENTION 1 2 3 4
1 10.714% 18.750% 13.393% 8.036% 2.679%
2 19.133 17.411 18.559 19.707 20.854
3 15.033 13.680 14.582 15.484 16.386
4 12.249 12.160 12.221 12.275 12.874
5-7 12.249 12.160 12.221 12.275 12.182
8 6.124 1.520 4.582 7.673 10.661
Total 100.000 100.000 100.000 100.000 100.000
_________________________________________________________________
ANNUAL FRACTIONS FOR STRAIGHT LINE OVER N YEARS (N less than 26)
_________________________________________________________________
MID-QUARTER CONVENTION
Tax MID-YEAR Quarter placed in service --
Year CONVENTION 1 2 3 4
1 1/2 7/8 5/8 3/8 1/8
2-N 1 1 1 1 1
N+1 1/2 1/8 3/8 5/8 7/8
_________________________________________________________________
Depreciation formula: Basis divided by N times number from above
table.
ANNUAL FRACTIONS FOR 27 1/2 YEAR PROPERTY, REGULAR MACRS
_________________________________________________________________
Tax Month Placed in Service --
Year 1 2 3 4 5 6 7 8 9 10 11 12
1 11.5 10.5 9.5 8.5 7.5 6.5 5.5 4.5 3.5 2.5 1.5 0.5
2-27 12 12 12 12 12 12 12 12 12 12 12 12
28 6.5 7.5 8.5 9.5 10.5 11.5 12 12 12 12 12 12
29 -- -- -- -- -- -- 0.5 1.5 2.5 3.5 4.5 5.5
_________________________________________________________________
Depreciation formula: Basis divided by 27 1/2 divided by 12 times
number from above table.
ANNUAL FRACTIONS FOR 39 YEAR PROPERTY, REGULAR MACRS
_________________________________________________________________
Tax Month Placed in Service --
Year 1 2 3 4 5 6 7 8 9 10 11 12
1 11.5 10.5 9.5 8.5 7.5 6.5 5.5 4.5 3.5 2.5 1.5 0.5
2-39 12 12 12 12 12 12 12 12 12 12 12 12
40 0.5 1.5 2.5 3.5 4.5 5.5 6.5 7.5 8.5 9.5 10.5 11.5
_________________________________________________________________
Depreciation formula: Basis divided by 39 divided by 12 times number
from above table.
-----------------------------------------------------------------
KEY
2008 DISTRICT FFA FARM MANAGEMENT CONTEST
Multiple Choice
1. A 11. A 21. B 31. C
2. C 12. A 22. A 32. B
3. B 13. B 23. D 33. B
4. D 14. A 24. C 34. C
5. B 15. B 25. C 35. C
6. A 16. D 26. D 36. B
7. A 17. C 27. C 37. C
8. A 18. B 28. D 38. C
9. B 19. B 29. D 39. B
10. D 20. D 30. C 40. D
Problems
1. D 11. C 21. C 31. A
2. C 12. D 22. A 32. C
3. D 13. D 23. C 33. A
4. A 14. B 24. B 34. A
5. E 15. C 25. A 35. C
6. B 16. C 26. D 36. C
7. A 17. C 27. A 37. D
8. C 18. D 28. B 38. B
9. B 19. C 29. B 39. C
10. C 20. C 30. B 40. C
|
