 Welcome to this Farm Accounting 101 presentation on Sample Accounting Entry Number 1, recording a co-op bill payment and an Excel spreadsheet. I'm Robert Page, Regional Extension Agent and member of the Farm and Agribusiness Management team with the Alabama Cooperative Extension System at Auburn University. As we've said in earlier presentations, the Farm Accounting 101 series is intended to help Alabama producers improve their farm financial literacy. Farmers, like every other small business, have the same basic financial transactions every year. So we study typical checks and deposits. We also learn the accounting principles behind these checks and deposits. Today's presentation shows a typical farm check as it would be entered into an Excel spreadsheet. Sample entry number 1 is posting a check for payment of purchases from the farm co-op store. The details of the purchase are on the co-op paper invoice, which is also considered our accounting source document. The farmer bought 86 bags of fertilizer for $2,142.55, four bags of corn seed for $1,266.01, and one 12-foot utility gate for $91.44. Our next step is to enter this check into the Excel spreadsheet for this farm. So we will switch our view over from this PowerPoint screen to the Excel spreadsheet. This is the sample Aces Farm Excel spreadsheet designed on the Schedule F form. Sheet 1 is part one income. Sheet 2 is part two expense, where we'll be working today. And sheet 3 is the profit summary, which combines the two sheets. So we begin entering the expense in cell A9 under the date. The date of the check is 020519. The check number is 2145. The third column we're going to enter the name of the vendor and the description of this purchase. So we're going to enter in local co-op purchase of fertilizer, seed, and gate. The total dollar amount of this check is $3,500, which we enter in column D. Now the way this spreadsheet works, we allocate this $3,500 to the three accounts involved. The first one is fertilizer, which will be in column F or line 11. Column F or line 11 for chemicals. And that's 2142.55. The next part of the line is for seed, which is on column U or line 26 of the Schedule F. Column U, line 26, seeds, and plants. And this dollar amount is 1266.01. Now let's check and see if we're in balance. Coming over to our check digit, which is in column AC, you can see that we're out of balance by $91.44. Which happens to be the exact amount of the gate purchase, which is going to be entered into line 25 column T. So we go back over to line 25 column T, which is considered repairs and maintenance on the Schedule F. And that's 91.44. Now we come back to the calculated total, and we are indeed in balance. Now as I mentioned a minute ago, part one is where we put all the income for the farm. Part two is where we put all the expense for the farm. And part three is the profit and loss summary. So so far we've not put anything in for income, but here are the three line items that have been tabulated and brought forward from page two to page three on the Excel spreadsheet. All right. Now let's switch back over and conclude this presentation. The Schedule F farm income and expense spreadsheet is available for producers to use for their own farm. To find the spreadsheet, visit the ACES website at www.aces and then select the topic tab entitled farming and then the topic tab entitled farm management to find the article entitled using an Excel spreadsheet for farm financial records. There is a link to this spreadsheet embedded in the article and you can download it for your use. Now let's briefly review the accounting entry for this check payment we entered into Excel. The farm expense accounts and there are three of them went up with debit entries. This records that farm expenses went up for these three expense accounts. The cash and bank entry records that the farm bank balance went down $3,500. Current assets decrease with credit entries. So notice the two columns. You have the debit column and you have the credit column. And like all accounting entries, debit and credit entries must be in balance. So in this example, total debits and credits are $3,500. We close by saying thank you for watching today's presentation on sample accounting entry one recording a co-op bill payment in an Excel spreadsheet. This segment of the Farm Accounting 101 series has been produced by the Alabama Cooperative Extension System Farm and Agribusiness Management Team at Auburn University in Auburn, Alabama. For additional information on the Farm and Agribusiness Management Team and other ACES program, please visit our website at www.aces.edu.