oil barron
Member
- Location
- Aberdeenshire
That was also a joke. Not suggesting that Clive sells data to the Russians. Don’t sue me.
Machinery Costs
- Thread starter 7616
- Start date
- Location
- Lincolnshire.
Clive doesn’t sell any data we have been through this before.
Bossfarmer
Member
- Location
- between Perth and Inverness
the reason its being done again and again is your completely missing the point...i wasnt talking about the cost to change i was talking about the monetary value of your 130k in 2018 in 2023, the value of money does not stay staticwe have done this many times, what I may or may not do in the future has no effect of what something HAS cost in the past. If I trade a Porsche turbo bought for 200K in against a VW Golf for 30k and the VW dealer gives me a 100k cheque did I make 70k on the Porsche
ask HMRC or any accountant how they cost depreciation ............ don't take my word for it
ill explain it another way i hope you grasp it.....IF you put the initial value in this example(130k) into an inflation matching investment it would be worth 160k in 2023, for you to sell that 130k tractor in 2023 for 100k youve not only lost 30k in cash but 30k in the value of money so 60k in total, therefore if you want to be precise with your cost of ownership you must allow for this too otherwise your just kidding yourself that youve only lost 30k
Bossfarmer
Member
- Location
- between Perth and Inverness
i wasnt talking about the cost to change for another tractor simply the value of money through an inflation calculator,he will never get this ................ lost count of how many times I've explained
Such logic is a tractor sales mans dream ! ....... look sir we can px your Fendt agains this here Massey at such amazing low cost to change, your Fendt has been almost free to own so get out now while the going is good
.........and the spiral of doom decline of an industry as the ££'s get sucked out continues without some even realising it
id suggest you are the fendt salesmans dream, the fact you allow inflation to erode your depreciation without even accounting for inflation, why not just keep it 30 years until the 2nd hand value is so inflated that you get the same price you pay for it and tell everyone the tractor was free
Bossfarmer
Member
- Location
- between Perth and Inverness
the bossiness comments are childish, you talk a lot clive and are very disrespectful but your business model is based on other peoples land, mine is based on my own which myself and family have worked hard to build upcashflow is important (more important that profit ultimately, but too many farm bossiness are run on cashflow alone ......... you have to be profitable as well to be sustainable or all you are doing is eroding capital, this is whats has been happening to a lot of UK farm bossiness for years IMO. but lucky for most their historic land investment has been keeping up and filling that gap / funding the farming "hobby" and keeping the bank happy
- Location
- Somewhere in time
You haven't costed it right anyway, it's an asset to "own" but you don't buy them for that do you
we have our own land and we farm other peoples
nothing disrespectful - I just understand the difference between my (and my hard working families) investment income and the income we generate trading as farmers
any item you own is an asset in accountancy or HMRC terms
when i buy my next tractor i will be considering 100% of its price tag …….. not a cost to change
Bossfarmer
Member
- Location
- between Perth and Inverness
you are disrespectful and childish the proof is in writing,
was listening to a podcast with property experts on, they said uk house prices havent actually gone up much in this last decade theyve merely tracked inflation they gave an example of a house sold for 40k more than the purchase price to which the seller was delighted, after putting the initial price into an inflation calculator it turned out the house hadnt made any profit whatsoever it was the same price they just hadnt bothered to work out 2023s monetary value, youd do well to understand such things
Bossfarmer
Member
- Location
- between Perth and Inverness
The example i gave of working out cost of ownership is an excellent way of working out what a tractor has really cost you especially in times of near 10% inflation..possible higher for AG,
as you rightly said you could sell the fendt for a cheaper brand making cost to change look cheaper which is why i said dont use cost to change use an inflation calculator
Have you got your head around this?
as you rightly said you could sell the fendt for a cheaper brand making cost to change look cheaper which is why i said dont use cost to change use an inflation calculator
Have you got your head around this?
You are entitled to your opinion (I won't share mine of you however out of politeness !)
Having owned a decent portfolio of residential and commercial property over the last decade and bought / sold through that period I am really rather certain price have gone up (in my postcode at least, in others it would be more and some maybe less) - of course likewise, so has inflation
what certainly hasn't gone up is cash
the way you cost money is simply = the interest rate because that IS the cost of money, simple
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Bossfarmer
Member
- Location
- between Perth and Inverness
You still fail to understand the time value of money and inflation...i think you do understand(hopefully) but just refuse to admit it,
back to the point at hand though did you understand the inflation calculation i gave you and why it was a better way of calculating cost of ownership than simple depreciation or cost to change method ?
ollie989898
Member
The interest rate/cost of money or inflation rate are secondary and external to your business. I can't possibly make this any less complex. They do not appear in your accounts and they have no role in asset value or cost of ownership of that asset.
ollie989898
Member
That is fine. You are obviously not involved in the property markets. No one can make any money in it as you say because prices haven't changed in the last decade. Good job you are a farmer and wouldn't waste money in such a foolhardy thing as the property market.
Bossfarmer
Member
- Location
- between Perth and Inverness
Ok the good news is that last fend you bought is going to be very low cost of ownership with these 10% interest rates
Bossfarmer
Member
- Location
- between Perth and Inverness
Sorry inflation rates
Not to stir trouble. But you’re wrong there. Interest paid is a cost to a business one that is tax deductible however. Interest rates and interest paid will have an impact on your profit and loss.