Real Status of the Farm Economy in Mongolian Wheat Farm

Focusing on Free Cash Flow

Abstract

In this study, we focused on free cash flow to calculate the income and expenditure of family farms that produce wheat in Mongolia, to clarify the actual situation and characteristics of such income. We analyzed discrepancies in profit and loss calculations and their causes. Furthermore, we conducted a capital flow analysis based on the free cash flow calculation results. The results revealed that for most farmers, there is a disconnect between income and expenditure calculations and profit and loss calculations. The cause of this discrepancy was the purchase of fixed assets for business and household use. The results, reveal that it is important to control operating net cash flow, agricultural cash inflow and farm economic surplus in small-scale family farming operations in Mongolia.