This textbook integrates financial economics and management in the area of agricultural finance. The presentation of financial economics discusses how the credit needs of farmer/borrowers are met by depositors through commercial banks. The financial management content presents methods used to make farm financial decisions including farm accounting, capital budgeting, and the analysis of risk. The textbook begins by developing the farm financial market focusing primarily on the market for debt. Next, the textbook presents an overview of accounting concepts important for the credit market. The accounting section provides a detailed discussion of the Farm Financial Standards Council’s suggestions for agricultural financial statements. Following the financial accounting, the book presents the use of ratio analysis applied to the farm firm. Next, the text describes capital budgeting followed by an introduction to risk analysis. Finally, the book presents the effect of debt decisions on the farm firm. In addition to the primary topics, the textbook includes a discussion of agricultural banking and monetary policy and an analysis of the choice of historical cost and market valued accounting methodologies on the farm debt decision.

Scope of agricultural finance; Farm financial management; Design of a farm financial accounting system; Analysis of farm financial statements; Organization and growth of the farm; Time value of money and capital budgeting; Accounting for risk in investment decision making; Strategies for reducing risk; The cost of capital and the optimal capital structure; Legal considerations in agricultural finance; Farm business organization; Income tax management; Disinvestment and estate planning; Agricultural and the macroeconomy; Design of a financial accounting system for agriculture; Analysis of financial statements for agriculture; Capital intensification and capital utilization in agriculture; Aggregate investment and fifinancing behavior; National economic policyinstruments; Effects of change in national economic policy; Financial intermediaries serving agriculture; Commercial banks and farm lending; Farm credit system; Government lending agencies serving agriculture; Other financial intermediaries; Evaluation of financial intermediation in agriculture.