As some of you will remember, I’ve been working in Quicken to get our financial records better organized. I’ve run into something of a setup conundrum for how to organize farm income. Per our accountant, we file a Schedule F to track our farm income and that has worked pretty well for us so far. And for general income estimation purposes, we’ve always just looked at gross receipts minus our blatant costs (such as feed, farmers’ market booth fees, butcher fees, whatever), to arrive at a net income. So for instance, one of our biggest income streams is our market hogs. I’ll look at how much we sold each hog for, then subtract out costs like feed, butcher fees, vet bills if any, breeding fees if any, etc. I know that an ideal setup would be to charge an hourly rate for the time I/we put towards each source of income, and then pay ourselves an hourly rate. We haven’t gotten that far yet in our organizational setup.
So now with our Quicken setup, I’m wondering whether I can keep our current setup, or if I need to go do that extra organizational work. When considering the pro’s and con’s, the pro’s would mainly be a much better organized set of records for the farm. The con’s would be that I would almost certainly not be able to pay myself for all the hourly work I do. Either I’d have to show that the farm business owes me back pay, or that I worked for free. For instance, I could easily show the time I spend working for the market hogs and layer hens, because I have enough income coming in from those that I could deduct my hourly rate from those income sources. But for other income sources, such as live animal sales, those sales don’t happen often enough to charge a regular hourly fee for my time. Of course we’re plugging away with me earning enough to always show that I was paid for my time, but honestly we’re not there yet.
How do folks with their own businesses set up this sort of thing in Quicken and/or their recordkeeping? Am I making this too complicated?