AGEC 101 EXAM SCRIPT 2025/2026 QUESTIONS AND
ANSWERS RATED A+
✔✔Limited Liability Company (LLC) - ✔✔Resource Acquisition
Continuity of Existence
Liability of Owners
Participation in Management
Compensation of Management
Transferability of ownership
✔✔Subchapter S Corporation - ✔✔Resource Acquisition
Continuity of Existence
Liability of Owners
Participation in Management
Compensation of Management
Transferability of ownership
✔✔Subchapter C Corporation (C Corp) - ✔✔Resource Acquisition
Continuity of Existence
Liability of Owners
Participation in Management
Compensation of Management
Transferability of ownership
✔✔Cooperative - ✔✔Resource Acquisition
Continuity of Existence
Liability of Owners
Participation in Management
Compensation of Management
Transferability of ownership
✔✔Non-Profit - ✔✔Resource Acquisition
Continuity of Existence
Liability of Owners
Participation in Management
Compensation of Management
Transferability of ownership
✔✔Accounts Payable - ✔✔The amount of money owed by a firm to other for goods or
services bought on credit and for which payment is to be made before the end of the
current accounting period
✔✔Inventory - ✔✔The amount of unsold products or inputs on hand at some point in
time
, ✔✔liability - ✔✔Debt that the business owes to the outside parties (Monetary, products,
services)
✔✔Owner's Equity - ✔✔Owner's current stake in the business
If the business were to sell, how much the owner would receive
✔✔Accounts Receivable - ✔✔The amount of money owed to a business by a customer
arising from the purchase of the business's goods or services
✔✔Net Income - ✔✔Revenue minus expenses for a given period of time
✔✔asset - ✔✔Any resource that helps the farm business produce output and earn
revenue
✔✔Profit - ✔✔Total revenue minus total cost. On the P&L statement, profit is equal to
gross margin minus operating expenses
✔✔Expense - ✔✔The cost required for something, or money spent to create a product
✔✔Revenue - ✔✔Income received from the sale of products
✔✔Current Asset - ✔✔The items on the firm's balance sheet that are cash or will turn
into cash before the end of the accounting period
✔✔Current Liability - ✔✔Debts that are payable before the end of the accounting period
✔✔Non-current assets - ✔✔Assets and property that is owned by a business that is not
easily converted to cash into a year
✔✔Non-current liabilities - ✔✔Obligations listed on the balance sheet that are not due
for more than a year
✔✔Solvency - ✔✔Ability to repay debts if the firm ended business today
✔✔Balance Sheet - ✔✔Snapshot of the business's finances
Summarizes the value of a business's assets, liabilities, and owner's equity at any point
in time
Will reveal what the business would sell for at this moment, how much the farm owner
would receive.
✔✔Liquidity - ✔✔Ability to meet day-to-day cash needs for the firm
✔✔retained earnings - ✔✔Income reinvested back in the farm business
ANSWERS RATED A+
✔✔Limited Liability Company (LLC) - ✔✔Resource Acquisition
Continuity of Existence
Liability of Owners
Participation in Management
Compensation of Management
Transferability of ownership
✔✔Subchapter S Corporation - ✔✔Resource Acquisition
Continuity of Existence
Liability of Owners
Participation in Management
Compensation of Management
Transferability of ownership
✔✔Subchapter C Corporation (C Corp) - ✔✔Resource Acquisition
Continuity of Existence
Liability of Owners
Participation in Management
Compensation of Management
Transferability of ownership
✔✔Cooperative - ✔✔Resource Acquisition
Continuity of Existence
Liability of Owners
Participation in Management
Compensation of Management
Transferability of ownership
✔✔Non-Profit - ✔✔Resource Acquisition
Continuity of Existence
Liability of Owners
Participation in Management
Compensation of Management
Transferability of ownership
✔✔Accounts Payable - ✔✔The amount of money owed by a firm to other for goods or
services bought on credit and for which payment is to be made before the end of the
current accounting period
✔✔Inventory - ✔✔The amount of unsold products or inputs on hand at some point in
time
, ✔✔liability - ✔✔Debt that the business owes to the outside parties (Monetary, products,
services)
✔✔Owner's Equity - ✔✔Owner's current stake in the business
If the business were to sell, how much the owner would receive
✔✔Accounts Receivable - ✔✔The amount of money owed to a business by a customer
arising from the purchase of the business's goods or services
✔✔Net Income - ✔✔Revenue minus expenses for a given period of time
✔✔asset - ✔✔Any resource that helps the farm business produce output and earn
revenue
✔✔Profit - ✔✔Total revenue minus total cost. On the P&L statement, profit is equal to
gross margin minus operating expenses
✔✔Expense - ✔✔The cost required for something, or money spent to create a product
✔✔Revenue - ✔✔Income received from the sale of products
✔✔Current Asset - ✔✔The items on the firm's balance sheet that are cash or will turn
into cash before the end of the accounting period
✔✔Current Liability - ✔✔Debts that are payable before the end of the accounting period
✔✔Non-current assets - ✔✔Assets and property that is owned by a business that is not
easily converted to cash into a year
✔✔Non-current liabilities - ✔✔Obligations listed on the balance sheet that are not due
for more than a year
✔✔Solvency - ✔✔Ability to repay debts if the firm ended business today
✔✔Balance Sheet - ✔✔Snapshot of the business's finances
Summarizes the value of a business's assets, liabilities, and owner's equity at any point
in time
Will reveal what the business would sell for at this moment, how much the farm owner
would receive.
✔✔Liquidity - ✔✔Ability to meet day-to-day cash needs for the firm
✔✔retained earnings - ✔✔Income reinvested back in the farm business
