TABLE 3
                  DEPRECIATION AND OTHER CAPITAL ADJUSTMENTS                     
            Minnesota and North Dakota Farm Business Mgmt. Education             
                            Red River Valley, 2004                               
                       (Farms Sorted By Net Farm Income)                         
                                     Avg. Of                                     
                                    All Farms     Low 20%    40 - 60%    High 20%
Number of farms                           230          46          46          46
Net operating profit                  110,531         -19      93,791     256,255
BREEDING LIVESTOCK
  Ending inventory                        643         270          63       2,229
  Capital sales                             2          -           -           - 
  Beginning inventory                     701         287         107       2,313
  Capital purchases                        25          -            1          39
  Depreciation, capital adjust.           -82         -17         -45        -123
MACHINERY AND EQUIPMENT
  Ending inventory                    315,648     233,061     269,280     513,109
  Capital sales                         4,666       2,281       4,677       6,258
  Beginning inventory                 287,859     224,217     240,530     462,754
  Capital purchases                    61,915      34,966      60,156     104,462
  Depreciation, capital adjust.       -29,460     -23,841     -26,729     -47,849
BUILDINGS AND IMPROVEMENTS
  Ending inventory                     59,316      53,680      38,851     113,217
  Capital sales                         2,192       3,913          -        5,943
  Beginning inventory                  51,166      47,690      33,448     101,853
  Capital purchases                     9,716       6,894       6,365      14,742
  Depreciation, capital adjust.           627       3,009        -962       2,565
OTHER CAPITAL ASSETS
  Ending inventory                    199,391     158,185     192,899     316,403
  Capital sales                         1,921           0         100       3,652
  Beginning inventory                 183,300     154,286     168,372     301,169
  Capital purchases                    12,684         543      18,028      10,096
  Depreciation, capital adjust.         5,328       3,356       6,598       8,791
Total depreciation, capital adj.      -23,587     -17,493     -21,137     -36,616
Net farm income                        86,944     -17,512      72,654     219,640