Small farmers can make a big difference in the
success of their farming operation by managing their costs.
Each enterprise needs to be watched. A planning
budget helps plan costs. A good record keeping system allows the farmer to monitor real
costs and compare them to the expected costs shown in the planning budget. Comparison then
helps point to cost weaknesses.
Comparisons of several enterprises -- both in
terms of planning and in terms of real costs -- allows selection of the best enterprise
mix for the farm.
Finally, cash flow (projected and actual)
analysis allows the farmer to mange the costs of borrowing or of allocating funds from one
source to another.
Using the Cash Flow Record Book
