DOCUMENT RESUME ED 300 614 CE 051 256 AUTHOR Bacon, Kevin; And Others TITLE Agricultural Management and Economics. Instructor's Guide. INSTITUTION Missouri Univ., Columbia. Instructional Materials Lab. SPONS AGENCY Missouri State Dept. of Elementary and Secondary Education, Jefferson City. Div. of Vocational and Adult Education. PUB DATE Jun 88 NOTE 427p. AVAILABLE FROMInstructional Materials Laboratory, 10 London Hall, University of Missouri, Columbia, MO 65211 (Catalog No. 10-8200-I). PUB TYPE Guides - Classroom Use - Guides (For Teachers) (052) EDRS PRICE MFO1 /PC18 Plus Postage. DESCRIPTORS *agribusiness; *Agricultural Education; Behavioral Objectives; *Economics; Farm Accounts; *Farm Management; Learnihg Activities; Postsecondary Education; Secondary Education ABSTRACT This curriculum guide contains four units and incorporates the neeied component parts to aid agriculture teachers in the implementation of the Vocational Instructional Management System. The guide consists of these four units: eccnomic principles in agriculture (6 lessons), business management (17 lessons), planning the farm business (9 lessons), and operating the agricultural business (5 lessons). Each unit begins with a section entitled "Getting Ready for This Unit," which contains important teaching information. The "Contents" section contains objectives, competencies, motivational technique or interest approach, references, and a competency profile. Each lesson contains the following components: objective, study questions, student references, teacher references, content outline, assignment sheet answers, and evaluation. Other contents of each lesson include assignment sheets, transparency masters, and handouts. (YLB) *********************************************************************** * Reproductions supplied by EDRS are the best that can be made * * from.the original document. * ********************************************************************** 10-EA00-I AGDEX P20/830 MISSOURI AGRICULTURALit^ EDUCATION ;KN.. *5'12 L 1;-: Agricultural Management And Economics U.S. DEPARTMENT OF EDUCATION Office of Educator:I Research and Improvement Instructor's Guide "PERMISSION TO REPRODUCE THIS ED AT1ONAL RESOURCES INFORMATION MATERIAL HAS BEEN GRANTED BY CENTER (ERIC) This document Nis been reproduced as received from the person or organization originating it. 0 Minor changes have been made to improve reproduction quality Points of viewor opinions stated in this docu- ment do not necessarily represent official TO THE EDUCATIONAL R URGES OERI position or policy INFORMATION CENTER (EIC)." 1111111/1111111 111[01110111 SIMMOGNO 11101116O1 411=1111 In cooperation with 111WMIX. In cooperation with Agricultural Eduction Agricultural Education Section Department of Practical Arts and Vocational-Technical Education Division of Vocational and Adult Education College of Education and Collegs of Agriculture Department of Elementary and Secondary Education University of Missouii-Columbla Jefferson City, Missouri The activity which k the subject ofthisreport was supported in whole orinpart by funds from the Department of Elementary and Secondary Education, Division of Vocational and Adult Education. However, the opinions expressed herein do not necessarily reflect the position or policies of the Missouri Department of Elementary and Secondary Education or the Division of Vocational and Adult Education, and no official endorsement should be inferred. 3 Instructor's Guide AGRICULTURAL MANAGEMENT AND ECONOMICS Kevin Bacon, Nick Boren, and Van Kirkwood Instructional Materials Laboratory University of Missouri-Columbia Robert J. Blrkenholz Agricultural Education and Ronald L Plain Agricultural Economics University of Missouri- Columbia Norman Rohrbach Agricultural Education Department of Elementary and Secondary Education Veronica Feilner, Editor Instructional Materials Laboratory University of Missouri-Columbia 10 London Hall Columbia, Missouri 65211 Volume 19 Number 16 Catalog Number 10-82uti-I June 1988 4 ACKNOWLEDGEMENTS Recognition is given to the Agricultural Managementand Economics Advisory Committee members for providingtheirvaluable time and suggestionsindevelopingthisunit. The committee consisted of: Frank Caldwell, Gene Cook, BobDenker, Terry Heiman, Delbert Lund, Joe Pace, Kent Schescke, Bob Stewart, Nick Thiele, Jeff Ward,and Curtis Weston. Greg Omer should be recognized for his input in thedevelopment of this curriculum. Appreciationisexpressed to the following staff members ofthe instructionalMaterials Labor- atoryfortheireffortsinproducingthismaterial:HarleySchlichting,Director; Amon Herd, Associate Director;PhyllisMiller,AssistantDirector;Dan Stapleton,AssistantDirector;Paul Hughes, GraphicArtist;CrystalDietiker,GraphicArtist;Shelly Chism, Word Processor;Sally Forquer, Word Processor; Norma Jacober, Secretary;and Karen Omer, Clerical Student Assistant. Robert J. Birkenholz, Assistant Professor Agricultural Education University of Missouri-Columbia II 5 FOREWORD This Agricultural Management and Economics curriculum guide representsa major revision of the Agricultural Management and Economics guide (Volume 9 Number 2). Revision of thisguide was suggestedby theMVATA TeachingAidsCommittee. TheAgriculturalManagementand Economics Advisory Committee suggested the topics to be discussed and ,reviewed the materials. A student reference has been developed for Unitsi,II,and IV. The Missouri Farm Planning Handbook (Manual 75) is the student reference for Unit III. !tisno longerappropriate sound to teachonlythespecificfactsrelatingtoproduction agriculture. Our teaching approach needs to be broadened by blending agribusiness with the production aspects of agriculture.Although some of the concepts presented inthis guide have been traditionally associated with an agribusiness operation, the principlesmay also apply to the operation of the farm business. The term agriculturalbusiness, used throughout thisguide, refers to all businesses in agriculture, including the farming operation. The guide consists of four units as follows:Unit IEconomic Principles in Agriculture; UnitII- -Business Management; Unit IIIPlanning the Farm Business; and Unit IVOperatingtheAgri- cultural Business.Check the Table of Contents for a detailed listing of lessons.The section in eachunittitled"Getting Ready forthisUnit"contains important teachinginformation. The *Contents* section in each unit contains objectives, competencies, references, anda competency profile. During the Sdmmer of 1981, the Missouri State Board of Education formally adopted theconcept of 'instructional Management Systems" (IMS) asa priority for the 1981-82 school year. The Missouri Commissioner of Education described the IMS concept as a practicalway of "organizing for excellences ineducation. To meet the demand for greater productivity and accountability, op Dr. Frank Drake,Director of Vocational Education, applied the elements of IMSto form the 'Vocational Instructional Management System* (VIMS). The VIMS process provides a framework touseinplanning andorganizing to assure excellenceinMissouri's vocationaleducational system by focusing greater attention on the management of teaching and learning. This guide incorporates the needed component parts to aid agricultureteachers in the implemen- tation of VIMS.For ease of use, performance objectives and competencies have been included at the beginning of each unit, as well as being incorporated within each lesson.A competency profile has also been provided in each unit for convenient record keeping. Bob R. Stewart, Professor and Coordinator Agricultural Education University of Missouri-Columbia Terry Heiman, Director Agricultural Education Department of Elementary and Secondary Education AGRICULTURAL MANAGEMENT AND ECONOMICS TABLE OF CONTENTS ACKNOWLEDGMENTS FOREWORD TABLE OF CONTENTS TEACHING CALENDAR UNIT I - ECONOMIC PRINCIPLES I1 AGRICULTURE GETTING READY FOR THIS UNIT !-1 CONTENTS I-1 COMPETENCY PROFILE 1-v Lesson 1The Principle of Diminishing Returns 1-1 Lesson 2Fixed and Variable Costs 1-23 Lesson 3Substitution of inputs 1-43 Lesson 4Opportunity Costs 1-61 Lesson 5 Supply and Demand 1-73 Lesson 6Time Value of Money 1-101 UNIT II - BUSINESS MANAGEMENT GETTING READY FOR THIS UNIT CONTENTS COMPETENCY PROFILE Lesson 1Ways of Organizing a Business 11-1 Lesson 2Steps in Buying Land 11-13 Lesson 3Starting an Agricultural Business 11-31 Lesson 4Using Contracts in Agriculture 11-39 Lesson 5Business Procedures 11-59 Lesson 6Agribusiness Records 11-67 Lesson 7Managing Inventory and Determining SellingPrice 11-75 Lesson 8Agricultural Business Customer Transactions 11-63 Lesson 9Preparation and Importance of Sales Tickets 11-99 Lesson 10Customer Credit 11-121 Lesson 11Loans for Agricultural Businesses 11-4,35 Lesson 12Conducting a Financial Analysis 11-143 Lesson 13Effects of income Tax on the Agricultural Business 11-153 Lesson 14Calculating Depreciation for Tax Purposes 11-167 Lesson 15Managing Risk in the Agricultural Business 11-191 Lesson 16Insurance Needs in the Agricultural Business 11-201 Lesson 17Cooperating Agencies In Agriculture 11-209 iv UNIT lil - PLANNING THE FARM BUSINESS GETTING READY FOR THIS UNIT CONTENTS COMPETENCY PROFILE III-v Lesson 1Setting Farm Busir3ss Goals III-1 Lesson 2Determining th. Present Situation III -11 Lesson 3Planning a Profitable Cropping System III-35 Lesson 4Determining Machinery Needs III-45 Lesson 5Planning a Profitable Livestock System III-65 Lesson 6Determining Labor Needs and Uses III-77 Lesson 7Determining the Amount of Capital Needed