1996 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.
Please place your answers in the appropriate box on the card
provided. There is only one correct answer to each question.
1. In using the options market for hogs, the producer will
usually
A. lock-in a price.
B. lock-in a minimum price.
C. lock-in a maximum price.
D. be able to ignore basis.
E. both C and D
2. If corn silage as fed contains 65% moisture and 2% protein,
the dry matter would be what percent protein?
A. 2.80
B. 3.08
C. 5.71
D. 8.00
E. None of the above
3. Farmer Brown purchases a new tractor. A record keeping system
which records both the addition to equipment and the
reduction of cash is called
A. income statement.
B. dual effect.
C. balance sheet.
D. double entry.
E. None of the above
4. 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
5. At the beginning of last year, a farmer had an outstanding
loan for $100,000. The interest rate was 9% APR. If the
farmer made one loan payment at the end of the year of
$20,500, what was the outstanding balance at the end of the
year?
A. $74,600
B. $84,600
C. $88,500
D. $95,400
E. None of the above
6. On April 1, 1994, Lynn borrowed $25,000 to buy seed and
fertilizer. On Dec. 1, 1994, she repaid the $25,000 along
with $1625.00 interest. What annual interest rate did she
pay?
A. 9.75%
B. 10.97%
C. 11.75%
D. 12.25%
E. None of the above
7. For 1995, the self-employment tax rate for Social Security
and Medicare is
A. 4.58%.
B. 7.65%.
C. 15.30%.
D. 25.00%.
E. None of the above
8. When the size of the soybean harvest exceeds locally
available farm and elevator storage, what happens to the
basis?
A. Basis narrows.
B. Basis widens.
C. Basis goes out of existence.
D. Basis is usually the same all year long.
9. A grain farmer who normally stores his soybeans at a local
elevator has decided to use the options market to create a
synthetic storage. To do so he will sell his beans at
harvest and
A. buy a put option.
B. sell a put option.
C. buy a call option.
D. sell a call option.
10. The role of price in a free market is to serve as a guide
A. in controlling quantity supplied.
B. in limiting quantity demanded.
C. in allocating consumption.
D. in deciding what, when, and how much to produce.
E. All of the above
11. The specified price at which the option purchaser may buy or
sell the commodity is the
A. strike price.
B. call price.
C. put price.
D. option price.
E. None of the above
12. A farmer is solvent 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
13. A Subchapter S corporation can have no more than
A. 10 shareholders.
B. 15 shareholders.
C. 25 shareholders.
D. 35 shareholders.
E. There is no limit on number of shareholders.
14. The maximum amount that a wife can inherit from her husband
without owing any federal estate tax is
A. $10,000.
B. $600,000.
C. $600,000 less excess gift tax.
D. unlimited.
E. None of the above
15. The maximum amount that can be claimed as a section 179
expense deduction on your tax return is
A. $5,000.
B. $10,000.
C. $15,000.
D. $17,500.
E. None of the above
16. Rate of return on investment for a farm business is
calculated by
A. dividing total assets by total liabilities.
B. subtracting total liabilities from total asset value.
C. dividing return to capital by average total assets.
D. dividing return to equity by net worth.
E. None of the above
17. Using comparable sales for the purpose of appraising farmland
is called the
A. market approach to appraising.
B. earnings approach to appraising.
C. inventory approach to appraising.
D. cost approach to appraising.
E. None of the above
18. The capital gains taxes that would be due should a farmer
sell his land is an example of a
A. current liability.
B. long-term liability.
C. deductible expense.
D. contingent liability.
E. None of the above
19. A limited liability company
A. is taxed like a corporation.
B. is taxed like a partnership.
C. can have no more than 35 members.
D. is not recognized by Missouri law.
E. None of the above
20. The best example of a fixed cost in a corn production
enterprise budget would be
A. seed corn.
B. fuel and oil.
C. land ownership costs.
D. interest on operating capital.
E. machinery repairs.
21. A charge for capital used in a farmer's cattle herd is
usually included in an enterprise budget regardless of the
farmer's equity position. This illustrates the principle of
A. marginal cost.
B. fixed cost.
C. opportunity cost.
D. variable cost.
E. alternative cost.
22. Net worth is a measure of
A. managerial ability.
B. financial position.
C. profitability.
D. liquidity.
E. All of the above
23. Diminishing marginal returns to a factor of production are
most likely to occur when
A. one factor is increased and all others are fixed.
B. one factor is fixed and all others are increased in
equal proportion.
C. all factors are increased in equal portion.
D. One factor is decreased and all others are fixed.
E. None of the above
24. Tom Farmer earned $27,000 from farming last year. His total
assets are valued at $380,000. He has outstanding mortgages
and loans of $125,000. What rate of return did he earn on
his equity?
A. 5.26%
B. 7.84%
C. 10.6%
D. 16.0%
E. None of the above
25. According to the "Farmers Tax Guide," the basis value of a
new depreciable asset where a like trade is involved is
A. the undepreciated balance of the item traded plus the
cash paid.
B. the cash paid.
C. its market price plus the undepreciated balance of
the item traded.
D. the market price minus the cash paid.
E. None of the above
26. A livestock producer, wishing to use futures markets to hedge
the price of cattle, would at the time of his cattle purchase
A. buy futures contracts expecting to sell the contracts
when selling cattle.
B. sell futures contracts expecting to sell more
contracts when selling cattle.
C. buy futures contracts expecting to buy more contracts
when selling cattle.
D. sell futures contracts expecting to buy contracts
when selling cattle.
E. All of the above
27. Renting land on shares of production rather than for cash
results in
A. less risk for both the landlord and the tenant.
B. more risk for both the landlord and the tenant.
C. less risk for the landlord, more risk for the tenant.
D. more risk for the landlord, less risk for the tenant.
E. no change in risk.
28. A producer sells 9 feeder steers for $68/cwt. The average
weight per steer is 700 pounds. There is a 2.5% sales
commission and yardage fees of $2.30 per head. The net
amount received for the pen of steers would be
A. $461.80.
B. $4,156.20.
C. $4,240.80.
D. $4,618.00.
E. None of the above
29. Fred Brown raises corn and feeds it to his hogs. This type
of business structure is an example of
A. vertical integration.
B. horizontal integration.
C. supply company.
D. marketing cooperative.
E. None of the above
30. Wheat yields 50 bushels per acre and the price is $3.00 per
bushel. The price of canola is $0.10 per pound. The cost of
production is $140 per acre for wheat and $150 per acre for
canola. What yield would be needed from canola to give the
same net returns as wheat?
A. 1,255 pounds
B. 1,545 pounds
C. 1,600 pounds
D. 1,635 pounds
E. None of the above
31. A feedlot operator buys feeder steers, finishes them, and
sells them. The operator estimates that finished steers will
sell for $63 per cwt. and that it will cost $230 per head to
bring them from the 700 pound purchase weight to the 1100
pound selling weight. What is the highest price the operator
can pay for 700 pound feeder steers to break even?
A. $66.14/cwt.
B. $70.25/cwt.
C. $76.14/cwt.
D. $82.50/cwt.
E. None of the above
32. What will the breakeven bid price for 700 pound feeder steers
be in the above question if high priced corn causes feeding
costs to increase to $315 per head?
A. $54.00/cwt.
B. $62.45/cwt.
C. $66.14/cwt.
D. $320/head
E. None of the above
33. A soybean producer decides to store his soybeans in the local
elevator for six months. The price at harvest is $6.00 per
bushel and the elevator charges 2› per bushel per month for
storage plus a 5› per bushel handling charge. He has 5,000
bushels to sell and must borrow $30,000 at 9% 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. $6.17
B. $6.32
C. $6.39
D. $6.44
E. None of the above
34. A $50,000 loan is amortized at 8% interest for 7 years yields
annual payments of $9,604.30. How much of the first year's
payment is principal?
A. $4,000.00
B. $4,604.30
C. $5,604.30
D. $9,604.30
E. None of the above
35. For the above loan of $50,000, if the seventh and final
payment includes $711.43 of interest, what was the
outstanding principal balance after the sixth payment?
A. $8,181.44
B. $8,892.87
C. $9,604.30
D. $10,315.73
E. None of the above
36. When an increase in the level of production of one enterprise
causes a reduction in the level of production of another
enterprise, these two enterprises are said to be
A. independent.
B. competitive.
C. supplementary.
D. complementary.
E. None of the above
37. The financial progress being made in a farm business from one
year to the next year is best shown by
A. a change in assets.
B. a change in net worth.
C. a change in liabilities.
D. a cash basis income tax statement.
E. None of the above
38. A farmer purchases 500-pound feeder steers for 60› per pound
and plans to sell the steers at 800 pounds. The farmer
estimates the total cost of gain to be 65› per pound. The
nearest breakeven price when the steers are sold at 800
pounds is
A. 61.87›/pound
B. 64.75›/pound
C. 73.42›/pound
D. 76.78›/pound
E. None of the above
39. The type of life insurance which provides protection for a
limited time and is usually cheaper per dollar of protection
is called
A. whole life.
B. term.
C. endowment.
D. new life.
E. None of the above
40. The tax you owe on each additional dollar of taxable income
is called the
A. Section 179 deduction.
B. straight-line tax rate.
C. marginal tax rate.
D. federal adjusted taxable income.
E. None of the above
______________________________________________________________
1996 DISTRICT FFA FARM MANAGEMENT CONTEST
Problems Section
For the following problems, place your answer for each question
in 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.
PROBLEM I - Balance Sheet
The Farm Financial Standards Task Force has recommended that farm
balance sheets be prepared with two time classifications --
current and non-current. Items that had been classified as
Intermediate or Long-term are now classified as non-current.
Using the information below, complete the net worth statement for
January 1, 1996:
Land . . . . . . . . . . . . . . . . . . . . . . . . $300,000
Autos . . . . . . . . . . . . . . . . . . . . . . . 15,000
Machinery and equipment. . . . . . . . . . . . . . . 95,000
Cows . . . . . . . . . . . . . . . . . . . . . . . . 71,000
Calves . . . . . . . . . . . . . . . . . . . . . . . 29,000
Sows and boars . . . . . . . . . . . . . . . . . . . 25,000
Market hogs . . . . . . . . . . . . . . . . . . . . 92,000
Checking and savings . . . . . . . . . . . . . . . . 6,947
House. . . . . . . . . . . . . . . . . . . . . . . . 69,000
Hog buildings . . . . . . . . . . . . . . . . . . . 50,000
Feed and hay . . . . . . . . . . . . . . . . . . . . 5,100
Accrued interest owed. . . . . . . . . . . . . . . . 3,750
Accrued taxes owed . . . . . . . . . . . . . . . . . 7,400
25-year land loan balance is $220,000.
$13,000 plus interest is due October 1 of each year.
5-year equipment loan balance is $61,000.
$18,000 plus interest is due August 31 of each year.
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, 1996, was:
A. $92,000
B. $98,947
C. $127,947
D. $133,047
E. None of the above
2. The total value of non-current assets was:
A. $206,000
B. $432,000
C. $625,000
D. $746,000
E. None of the above
3. The total value of current liabilities was:
A. $11,150
B. $24,150
C. $31,000
D. $42,150
E. None of the above
4. The total value of non-current liabilities was:
A. $43,000
B. $207,000
C. $250,000
D. $262,000
E. None of the above
5. The net worth was:
A. $375,000
B. $465,897
C. $684,897
D. $758,047
E. None of the above
6. The current ratio was:
A. 0.612
B. 1.944
C. 2.871
D. 3.156
E. None of the above
7. The percent equity (net worth/assets) was:
A. 61.5%
B. 84.5%
C. 137.9%
D. 162.7%
E. None of the above
PROBLEM II -- Enterprise Budget
Use the following dairy cow budget to answer Questions 8 through
16.
_________________________________________________________________
DAIRY COW REPLACEMENTS IN 100 COW HERD
20,000 pounds of milk sold per year per cow unit
Operating Inputs Units Price Quantity Value
Gov Dvsrn asses Cwt 0.05 200.00 10.00
Promotion assess Cwt 0.15 200.00 30.00
Milk hauling Cwt 0.57 200.00 14.00
Dairy ration, 16% Cwt 8.70 98.67 858.43
Hay Tons 95.00 5.59 531.05
Salt & minerals Lbs 0.15 130.00 19.50
Milk replacer Lbs 0.75 5.00 3.75
Calf starter Lbs 0.11 50.00 5.50
Pasture AUMS 16.00 3.48 55.68
Breeding fees Dol 25.00 1.00 25.00
Vet medicine Dol 52.00 1.00 52.00
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 6.00 10.69 64.18
Equipment labor Hr 6.00 6.27 37.62
Livestock labor Hr 6.00 43.40 260.40
Mach fuel, lube, repair 102.91
Equip fuel, lube, repair 27.74
Total Operating Costs 2301.76
____________________________________
Fixed Costs Amount Value
Machinery
Interest @ 10.675% 371.17 39.62
Depr, taxes, insurance 54.98
Equipment
Interest @ 10.675% 452.75 48.33
Depr, taxes, insurance 70.22
Livestock
Dairy cow, 20,000 1475.00
Dairy heifer, 20,000 520.00
Dairy repl. heifer 20,000 273.00
Interest @ 10.675% 2268.00 242.11
Total Fixed Costs 455.25
______________________________________
Production Units Price Quantity Value
Milk Cwt 12.90 200.00 2580.00
Dairy cows Cwt 43.00 4.44 190.92
Dairy bull calf Hd 105.00 0.48 50.41
Dairy heifers Cwt 60.00 0.04 2.38
Total Receipts 2823.71
_______________________________________
Returns above total operating costs 521.95
Returns above all specified costs 66.70
39% replacement rate
_________________________________________________________________
8. Total operating cost per cow is:
A. $521.95
B. $588.65
C. $2,301.76
D. $2,823.71
E. None of the above
9. The return above total operating cost per cow is:
A. $66.70
B. $455.25
C. $501.52
D. $521.95
E. None of the above
10. How many hours of labor are budgeted per cow?
A. 10.696
B. 43.400
C. 60.366
D. 260.400
E. None of the above
11. What price per ton is paid for hay?
A. $5.59
B. $95.00
C. $211.86
D. $531.05
E. None of the above
12. What is the total budgeted interest cost per cow?
A. $330.06
B. $1,188.49
C. $3,091.92
D. $3,190.59
E. None of the above
13. 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. 200.00
E. None of the above
14. What price per pound is paid for hay?
A. 2.66›
B. 4.75›
C. 5.59›
D. 26.51›
E. None of the above
15. What interest rate is used in this budget?
A. 3.900%
B. 10.675%
C. 12.500%
D. 16.000%
E. None of the above
16. If cull cow prices drop to 34› per pound and bull calves sell
for $50 each, what will be total receipts per cow?
A. $2,757.34
B. $2,783.34
C. $2,783.75
D. $2,797.31
E. None of the above
PROBLEM III -- Income Tax Management
Use the following tax tables to answer questions 17 through 22.
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 5.5 7.5 8.5 9.5 10.5 11.5
_________________________________________________________________
Depreciation formula: Basis divided by 39 divided by 12 times
number from above table.
On October 15, 1995, Dave traded tractors. The old tractor had a
remaining undepreciated value of $6,812. Dave paid $40,500
"boot" in the trade for the new tractor.
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 Dave does not expense any of the cost of the tractor, then
1995 depreciation will be (use regular MACRS and mid-year
convention):
A. $5,069.01
B. $5,914.13
C. $7,787.15
D. $10,902.30
E. None of the above
19. If Dave expenses the maximum on the tractor trade, and uses
the mid-quarter convention and regular MACRS, then 1995
depreciation will be:
A. $798.66
B. $1,471.97
C. $1,606.92
D. $2,395.69
E. None of the above
20. If Dave does not expense and uses the mid-year convention and
straight line depreciation over the alternate MACRS life, his
1995 depreciation will be:
A. $2,365.60
B. $5,507.19
C. $7,268.20
D. $1,160.39
E. None of the above
21. In order to use the mid-quarter convention, at least ______
percent of Dave's 1995 purchases of depreciable property must
have been made in the fourth quarter.
A. 60%
B. 50%
C. 40%
D. 33%
E. None of the above
22. Under MACRS, a machine shed is classified as
A. 15-year property
B. 20-year property
C. 27.5-year property
D. 31.5-year property
E. None of the above
PROBLEM IV -- Supply and Demand
(See graph)
The above graph represents the supply of U.S. wool (SUS), the
demand for wool in the U.S. (DUS), the supply of foreign wool for
import (SF), and the total supply of wool (ST).
23. What is the market equilibrium price of wool in the U.S.?
A. P1
B. P2
C. P3
D. P4
E. P5
24. At the market equilibrium price, how much wool will be used
in the U.S.?
A. Q1
B. Q2
C. Q3
D. Q4
E. Q5
25. At the market equilibrium price, how much wool will be
imported?
A. Q1
B. Q2
C. Q3
D. Q4
E. Q5
26. Without foreign supply, the equilibrium price of wool would
be:
A. P1
B. P2
C. P3
D. P4
E. P5
For Questions 27 and 28, include foreign supply and assume the
government ends a 50-year old program to support U.S. sheep
producers by paying a subsidy on each pound of wool produced.
27. Without the wool subsidy the U.S. wool supply curve (SUS)
should
A. shift to the left and up.
B. shift to the right and down.
C. not change.
D. None of the above
28. Without the subsidy paid to U.S. sheep producers
A. imports of wool should go up.
B. the equilibrium price of wool should go up.
C. Both of the above
D. the foreign supply of wool should shift left.
E. None of the above
PROBLEM V - Marketing
In January, a farmer has 5,000 bushels of soybeans in the bin.
He sells the soybeans on June 15. Ignore storage, commissions,
and interest.
January 15 quotes: June 15 quotes:
July futures price = $6.80 July futures price = $6.50
Expected basis= $.40 under the board Basis= $.25 under the board
Strike --- Premiums --- --- Premiums ---
price Call Put Call Put
$5.00 $1.25 $0.05 $1.40 $0.01
$5.50 $0.81 $0.15 $0.90 $0.02
$6.00 $0.37 $0.25 $0.55 $0.08
$6.50 $0.25 $0.55 $0.15 $0.21
$7.00 $0.15 $1.05 $0.05 $0.55
29. What is the cash price of soybeans on June 15?
A. $6.20
B. $6.25
C. $6.50
D. $6.75
E. None of the above
30. If the farmer sold a futures contract on January 15 and
bought back the contract on June 15, what would be the
realized price per bushel (cash + net on futures) for his
soybeans?
A. $5.95
B. $6.20
C. $6.55
D. $6.80
E. None of the above
31. If the farmer bought a $6.50 Put on January 15 and sold the
Put on June 15, what would be the realized price per bushel
(cash + net on options) for his soybeans?
A. $5.91
B. $6.25
C. $6.59
D. $6.84
E. None of the above
32. If the farmer bought a $6.50 Put and sold a $6.50 Call on
January 15, and sold the Put and bought back the Call on June
15, what would be the realized price per bushel (cash + net
on options) for his soybeans?
A. $6.01
B. $6.24
C. $6.49
D. $6.74
E. None of the above
33. Given all the information above, which of the following
actions taken on January 15 turned out to be the most
profitable?
A. Selling a futures contract.
B. Buying a $6.50 Put option.
C. Buying a $6.50 Put and selling a $6.50 Call.
D. Taking no market action.
PROBLEM VI - Investment Analysis
In February 1995, Junior Jones purchased his mother's 240-acre
farm. The farm is entirely in pasture and hay. Junior is trying
to decide whether he should continue to rent the farm to a
neighbor who has been paying $4,800 per year pasture rent, or to
buy cattle and graze the land himself. Junior figures there is
enough pasture and hay to support a 60-cow herd.
34. Junior can buy some good quality cows for $450 and bulls for
$1,500 each. He can borrow the money at the bank for 10%
interest. What will be his annual capital cost for 60 cows
and two herd bulls?
A. $1,750
B. $2,750
C. $3,000
D. $5,640
E. None of the above
35. Junior will have the hay custom baled. He has 40 acres of
alfalfa which averages 5 tons per acre. He can get it baled
and put in the barn for $40 per ton. What will his hay cost
be?
A. $1,600
B. $3,200
C. $4,000
D. $8,000
E. None of the above
36. Junior figures it will require 10 hours per week to take care
of the cows. But, since he enjoys working with cattle, he
only puts a value of $5 per hour on his labor. What will be
the annual charge for his labor?
A. $50
B. $480
C. $2,400
D. $2,600
E. None of the above
37. Junior figures he can get a 90% calf crop and market the
calves at 500 pounds for 60› per pound. What is his expected
gross income?
A. $16,200
B. $22,950
C. $25,500
D. $28,500
E. None of the above
38. Junior estimates that minerals, veterinary, taxes, insurance,
trucking, and other miscellaneous costs will amount to $25
per cow per year. He figures that it will cost him $500
annually to trade bulls. These costs total to
A. $1,500
B. $1,700
C. $1,850
D. $2,000
E. None of the above
39. Using the costs and returns identified above, Junior should
A. rent the pasture for $4,800.
B. get into the cattle business.
40. Given the above costs, what price for 500 pound calves will
leave Junior with the same $4,800 net as the rent provides?
A. $71.48
B. $75.56
C. $85.78
D. $92.69
E. None of the above
___________________________________________________________________
1996 DISTRICT FFA FARM MANAGEMENT CONTEST
Key
Multiple Choice
1. B 11. A 21. C 31. A
2. C 12. C 22. B 32. A
3. D 13. D 23. A 33. D
4. D 14. D 24. C 34. C
5. C 15. D 25. A 35. B
6. A 16. C 26. D 36. B
7. C 17. A 27. D 37. B
8. B 18. D 28. B 38. A
9. C 19. B 29. A 39. B
10. E 20. C 30. C 40. C
Problems
1. D 11. B 21. C 31. A
2. C 12. A 22. B 32. A
3. D 13. C 23. B 33. A
4. C 14. B 24. D 34. C
5. B 15. B 25. B 35. D
6. D 16. A 26. D 36. D
7. A 17. C 27. A 37. A
8. C 18. A 28. C 38. D
9. D 19. A 29. B 39. A
10. C 20. A 30. C 40. B