AgVenture.Beginning.2006.02.212ppt

AgVenture.Beginning.2006.02.212ppt - Enterprise Agreements...

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Beginning Farm Business Arrangements
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Testing Stage p. 1 Employer-employee arrangements Operating agreements
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Employer-Employee Agreementp. 1 Compensation: Cash Wage and income share Incentives Bonus payments Fringe benefits Commodities
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Operating Agreements p. 3 Beginning operator May furnish some personal property such as livestock or machinery May provide some management as well as labor
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Operating Agreements p. 3 Agreements should cover topics such as: Job responsibilities Contributions of assets Distributions of income Method of settling disputes Dissolution of the agreement
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Joint Operating Agreement p. 3 Operators are sole proprietors Each contributes assets, management and labor Income is shared based on inputs Each pays expenses of their assets Operating expenses are split
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Joint Operating Agreement p. 3 Complete inventory should be taken at the beginning Sale triggers recognition of gain Could be transferred by gift Could allocate income to pay for inventory Could repay at end of agreement
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Unformatted text preview: Enterprise Agreements p. 5 Beginning operators income is all from one enterprise Labor for other enterprises may be a source of conflict Total Farm Operating Agreements p. 6 All income and operating expenses are split Beginning operator acquires more assets over time Leasing Considerations p. 6 Allows effective use of limited capital Short or long term Land, buildings, machinery or livestock Real estate leases p. 6 Leases for more than a year must be in writing 90 days notice is required to terminate a year-to-year agricultural lease Real estate leases p. 7 Cash leases Crop share leases Livestock share leases Farm building leases p. 8 Leasing from builder or bank An alternative to financing Leasing from a neighbor Be careful about cost of repairs Livestock leases p. 8 From leasing company From retiring farmer Advantages for retiring farmer Advantages for beginning farmer...
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This note was uploaded on 08/08/2008 for the course AAE 320 taught by Professor Mitchell during the Spring '08 term at Wisconsin.

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AgVenture.Beginning.2006.02.212ppt - Enterprise Agreements...

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