Page 316 - Agriculture_Form_Three

Agriculture for Secondary Schools
Agriculture for Secondary Schools

Inventory: Juhudi Farm
Original unit
Item Quantity Date acquired Remark
costs (TZS)
Hand hoes 7 31/08/2021 2,500 Bought new
Ox-plough 2 04/05/2021 115,750 Used
Pangas 10 03/09/2021 3,800 Bought new
Milking shed 5 12/10/2021 1,120,000 Constructed
Cattle 2,815 30/06/2021 1,450,000 Bred on farm
Buildings 13 30/06/2021 7,250,000 Existed
Goats 8,179 01/07/2021 55,000 Bred on farm

Figure 14.1: Inventory of Juhudi farm
Activity 14.1
1. In groups, visit your school store or nearby farm and find out how the inventory
is prepared and kept.
2. Prepare an inventory for the assets that are present in your school store or nearby
farm. You may do the same for the home enterprise(s).

Depreciation of farm assets
Depreciation involves a fall in the value of capital assets. Depreciation is due to the
fact that capital goods or production goods do not last forever but wear out. In this
regard, after a certain time, they have to be replaced by new ones. Depreciation of
farm asset gives the estimate of the amount by which the value of asset falls in a
given period of time. The main reasons for depreciation include:
(a) Wear and tear with time
(b) Gradual deterioration with age
(c) Obsolescence, that is, an asset gets out of fashion as years pass on as a result of
change in technology.
Depreciation occurs continuously year after year. For example, as a building gets
old, its walls may crack and need to be repaired or replaced. Similarly, as machinery
and equipment are used, they wear out and they have to be repaired. The value of
the assets decreases slowly even if they are not in use. Despite the continuous repair
of an asset, it reaches a point where it can no longer be repaired. This is the point
where the useful life of an asset elapses. At this point, the value of the asset is termed
as salvage value. Salvage value is also known as scrap or residual value. It is the
estimated value that an asset is supposed to cost at the end of the year the asset is
expected to be in operation. For example, a farm asset that is expected to be totally
discarded at the end of its useful life will have zero salvage value.

Student’s Book Form Twos Book Form Three
Student’
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