Thinking of owning a farm? Farming is great for some people but it’s not for all. A farm has many assets and liabilities when it comes to finances. One of the assets of owning a farm is seeing the plants grow and making a profit off of those plants. The liabilities of a farm are the expense of seed, cost of employees, and the cost incurred for plant care. A farm can be very expensive but it can also be very profitable. A liability of owning a crop farm is the expense of seed. Seed prices can vary depending on the crop that meets the farmer’s needs. Corn has many different types of plant species, from comestible corn to the non-comestible corn. Field corn is a non-comestible corn that is ground in to corn silage. Corn silage is used by
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Alfalfa hay is the feed that can or will complete that task, although it costs more to grow. Most alfalfa seed costs $349.00 for a 50 pound bag. (Seedland) To cover an acre of land it takes 20 pounds of seed, because 60% of the alfalfa seed never matures, to cover the one acre. An acre is equal to 4840 Sq. yards. Most dairy farmers feed their cows a diet of a small percent of silage and then a larger percent of alfalfa hay for the best quality milk.
Alfalfa seed is a liability in the beginning but over time it becomes an asset. For example, if there were a 280 acre farm that grew only alfalfa and all 280 acres were used, then the 280 acre farm will produce 7 tons of alfalfa hay per acre. A one ton bale of alfalfa hay can cost about $220.00, so for that farm it would receive about $431,000. But most farmers that want high quality hay cut the alfalfa about 4 times a year. The seed for a 280 acre farm would be about $30,132. After you plant the alfalfa seed, the plant will regrow for 4 years before you have to plow it under and plant a new crop. So, for 4 year you will be making a profit off of that seed.
Other expenses of owning a farm are taxes that a farmer has to pay to the government. Those taxes include “Sales, Excise, Property, and Other Taxes Paid.” All farmers in Idaho have paid millions of tax dollars to the government. There was over $42,300,000 in property tax to the government from farms, in 1994.