WFM Table of Contents

FARM FINANCIAL ANALYSIS RATIOS AND RISK INDICATORS

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WFM Table of Contents

2001---What are your averages? Compare! Ask your self questions!

2001 Financial Ratio Table of Contents

  1. Debt Level
  2. Current Ratio-Working Capital
  3. Interest Exposure
  4. Profitability of the Farm
  5. Return to Equity
  6. Return to Averages
  7. Return to WFM Table of Contents.

 

These are guidelines you can use to see where you are. There are other factors that can be or should be taken into consideration.

What is your debt level (Total Liabilities/Total Assets? Local Avg. to date(Cost)--43.0%

Superior Under 10%

Debt to Asset Good 10%-40%

Watch Close 40%-55%

Weak 55%-70%

Inferior Over 70%

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Can you cover current obligations?

Current Ratio-Working Capital(Current Assets/ Debts)

Local Avg. To Date(Cost)--114%

Superior Over 150%

Good 120-150%

Watch Close 110%-120%

Weak 100%-110%

Inferior <100%

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What is your interest exposure? (Interest/Gross Income). Local Avg. To Date(Accr)--8.9%

Superior Under 5%

Good 10%-15%

Watch Close 15%-20%

Weak 20%-25%

Inferior Over 25%

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What's the profitability of the farm?

(Net Farm Income +Interest/Total Assets) Local Avg. To DateCost)--5.3%

Superior Over 12%

Good 8%-12%

Watch Close 4%-8%

Weak 0%-4%

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What's the profitability of your equity investment?

Return on Equity(After Interest) Local Avg. To Date(Cost)--3.1%

Superior Over 10%

Good 6%-10%

Watch Close 2%-6%

Weak 1-2%

Inferior Under 1%

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