Creating a Market-Basis and Cost-Basis Balance Sheet

Meeting Dates: 

• Learning Session: February 24th - 12 to 1:30 PM MST

• Office Hours: February 26th - 6 to 8 PM MST

Learning Session: With last week’s homework assignment, we have laid the groundwork for a cost basis balance sheet. It can be hard to start with cost basis estimates, because oftentimes you are relying on your own numbers to determine your costs and you run into a bit of the chicken or egg question. Looking at past data, we can try to assess what a reasonable capitalization cost should be for livestock according to market reports and some common sense. This week we will also pivot and cover liabilities (loans) and why it is a good practice to reconcile loans as well as bank accounts on a regular basis.

Weekly Deliverable: You will create a market-basis balance sheet that you could use to present to a banker or loan officer, as well as a cost-basis balance sheet for you to work off of when you are making your own management decisions.