When setting up your balance sheet in FarmRaise Tracks, it's important to classify your assets properly. This not only gives you a clearer picture of your operation's financial health, but it also helps when you’re applying for USDA programs, loans, or grants, or calculating key indicators like your debt-to-asset ratio.
Assets are divided into three main categories based on how long they are expected to provide value: current, intermediate, and long-term. Here's what you need to know about each:
Current Assets (Expected Use: One Year or Less)
Current assets are items that you expect to sell, use, or convert to cash within one year. These assets keep your operation running on a day-to-day basis and are typically your most liquid resources.
Examples of current assets:
Cash on hand
Checking and savings accounts
Retirement accounts that are accessible within the year
Accounts receivable (e.g., unpaid customer invoices)
Prepaid expenses (e.g., insurance or input costs paid in advance)
Inventory you plan to sell within the year, such as:
Grain leftover from last harvest
Produce in cold storage
Frozen beef or other value-added farm goods
In FarmRaise Tracks, recording current assets helps you evaluate your short-term financial stability and readiness to cover operating expenses.
Intermediate Assets (Expected Use: 1–10 Years)
Intermediate assets are those that have a useful life longer than one year, but typically less than 10 years. These are tools and equipment that help you operate efficiently over the medium term.
Examples of intermediate assets:
Farm machinery and equipment (tractors, planters, sprayers, etc.)
Breeding livestock (such as bulls, brood cows, or sows used for multiple seasons)
Vehicles used in the business (trucks, trailers, ATVs)
Office equipment and computers
Irrigation motors and small pivots with shorter life spans
These assets depreciate over time, and entering them into Tracks helps you calculate depreciation for tax prep and understand how your equity is built over time.
Long-Term Assets (Expected Use: 10+ Years)
Long-term assets are your big-ticket items. These are often fixed assets that form the foundation of your operation. They last a decade or more and typically don't change hands often.
Examples of long-term assets:
Land
Barns, sheds, and other permanent buildings
Drainage tile systems
Wells or irrigation pivots with long useful life
Grain bins or silos
Capital investments in infrastructure or major facility improvements
Beginning farmers may not have many long-term assets yet—but if you’ve built equity in land, buildings, or other long-term assets (even if you’re still paying off a loan), you should record the equity portion as an asset in Tracks.
Why Classifying Your Assets Matters in Tracks
Properly categorizing your assets in FarmRaise Tracks allows you to:
Build a professional balance sheet for lenders, farm programs, or your own records
Track the value of your farm business over time
Access key financial ratios (like debt-to-asset or current ratio) to make smarter decisions
Prepare for tax season with less stress
Quick Reference Table
Asset Category | Timeframe | Common Examples |
Current | ≤ 1 year | Cash, grain, produce, beef, savings accounts |
Intermediate | 1–10 years | Equipment, breeding livestock, computers |
Long-Term | 10+ years | Land, buildings, tile, grain bins |
If you're ever unsure how to categorize something, think about how long it will actively provide value to your farm business—and if you're stuck, reach out to the FarmRaise team for support. We're here to help!