^ ^ Ml EIIBBACING . SINGLE AND DOUBLE ENTRY, COMMERCIAL CAtCCLATlONS, AND THE FHILOSOPHf AND MORALS OF BUSINESS. "SMitm all things In number and welcbt, and pt t all In vneitiag VM tbou glvest out or Teoeivest in." Eaclesissttons ^m 7. BY IRA MAYHEW, A.M., iOiHOB or " Mjung Am mvs or skitxiiul ammimatif BOSTON : HALL AND WHITING, 32 BEOMFIELD STREET. ae * 9m^ A Reliable Practical Business School. lAYHEW BUSINESS COLLEGE, DETROIT, MICH. OOHDUOTED BY HOK. IRA MAYHEW, FOB BIOHT TEARS SUPKKINTEKDBNT OF PURLTO INSTRUCTION IN MICHIGAN, AND' AUTHOR OF THE FOLLOWINS STANDARD SDUOATIOHAI. WORKS : MEANS AND ENDS OF UNIVERSAL EDUCATION, Prepared pursuant to a resolution of the Legislature of Michigan, and now published in " The School Teachers' Library." MAYHEW'S PRACTICAL BOOK-KEEPING, For Common and Union Schools, and for home study (price 80 cents), extensively used in every part of the United States and the Canadas. MAYHEW'S UNIVERSITY BOOK-KEEPING, A new and elegant work for Commercial Colleges and Seminaries of Learning, for use in the Counting-room, and for private study (price l|2.50), containing a large amount of practical Instruction on a variety of subjects of great value to business men, and not to be found In any other publication. These works have been everywhere redelved with a degree of favor never before extended to similar treatises. The University Book- keeping, as first published, has been spoken of by teachers using it, as " admirably adapted to the fullest wants of commercial students." But the author has since provided a valuable Business Practice that may be operated by the student while writing up the sets of the book. This new feature employs engraved money and separate business papers in the great variety required by the transactions worked, and provides full directions for their use. No provision for representing business practice has ever before been attempted by any author. The University Book-keeping 'is therefore the only work published providing complete instruction in practical accountantship. This book may still be used as heretofore without the money and papers referred to (whenever teachers find it inconvenient to employ them), as when thus used it has earned the reputation of being an eminently practical work. For further information relating to the Business 'Practice, see the Appendix to the University Book-keeping. THE MAYHEW BUSINESS COLLEGE, Is a large first-class institution, permanently established, and con- ducted with all that educational ability aM business accuracy which eminently distinguish the Mayhew Book-keepings, and have given them their wide-spread popularity throughout the nation. Its arrangements for fiiU instruction in first principles, and for thorough- ness throughout, are strongly commended by our leading business men. E«i5B1Sally Is this truje oi'f^'-2Jtm!^-3*rS|tfcy,f wiOf.-#iiploys engraved representative money, anil several hundred Varieties of caroflilly prepared business papers, besides thole to be originated by the student, and is taught in the use of an invention called THE BUSINESS PRACTICE DRAWER, "Which secures completeness in all the details of the student's vcork,— the only invention for this purpose ever awarded =■ patent. Each student in operating it is required to practice every particular of his work, as in actual business. At the proper time, the student receives not only all money, but every business paper that should come to him from others in the management of his business, including notes, bills, checks, drafts, invoices, account-sales, insurance policies, deeds, etc. He also himself pays all sums called for by the transactions of the sets he works ; deposits money, checks, and drsifts In jank from time to time; computes Interest and discount, and originates Invoices, receipts, checks, drafts, etc., as required, precisely as in business. All" the entries in the various books used are at the same time carefully written up, according to approved usage. This original method of teaching business practice is remarkable for system in training and accuracy of results, and is the only one known which admits of a thorough written examination of the student's work. Under the direction of experienced and competent instructors, with these ample facilities, students readily acquire complete proficiency at the desk, or fit themselves in the best possible manner for an intelligent perform- ance of the varied duties of the counting-room. i The Mayhew Business College is supplyinlfa large number of Business Colleges and Seminaries of Learning wi&i text-books and all the materials for conducting the business practice. Teachers from . various other institutions visit the Mayhew College with a view to becoming acquainted with its improved methods. The experience of Its founder and his associates, its superior text-books, and its un- equaled business practice, constitute this, in fact, a most valuable Tkainixg School for persons desirous of learning book-keeping, whether with a view to practicing accountantship, to engaging in business, or to giving Instruction in book-keeping in Business Colleges or other Institutions of learning. The Mayhew College draws its patronage from far and near ; and it in many ways pays young men to come a long distance to attend here at " lieadquarters." TUITION AND EXPENSES. Scholarships, time unlimited, are issued to students at <40. Textr books, and all stationery required, cost about |8. All expenses, ex- clusive of board (which may be had at |4 to fa a week), need not exceed f 50 for the course. For full descriptive circulars of college, books, or business practice, addrest,, 'yith stamp, lEA MAYHEW, President. Dated Detroit, Mich., 1870. Cornell University Library The original of tliis book is in tine Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/details/cu31924031272432 arVl9249^"™" ""'""raHy Library oiin,anx ^^^4 031 272 432 EMBBAOIHS SINGLE AND DOUBLE ENTRY, COMMEECIAL CALCULATIONS^ AND THE PHILOSOPHV AND MORALS OP BUSINESS. 'Deliver all things in nnmber and weiglit, and put all in writing that thou givest out or reoeivest in."— EocleBiaeticus xlU. 7. By IRA MAYHEW, LL.D., AVIEOB or "MEANS AND BNDs'oP DNIVBBSAL BDCCATION," " CNIVEBSITT BOOK-KEBFIlia," " MANUAL OF BCSINBSS PEACTICB," ETC. BOSTON : HALL AND WHITING, 82 BBOMFIELD STREET. ^ZZ3 r &Sr M^-^mJ ACCOUNT BOOKS. A Set of Account Books has been prepared expressly to accompany jhia volume, of sufficient size and properly ruled for writing up all the Examples for Practice it contains, consisting of I. A Ledgeb por the Fibst Jokm of Accounts. One Book. II. A Ledger for the Second Fork of Accounts. One Book. III. A Day Boos, and Ledger for the Third Form of Ac- counts. Two Books. IV. A Journal and Ledger for Doitble Entrt. Two Books. These Account Books cost but little more than common paper. KEY TO BOOK-KEEPING. A Key to this Book-keeping has been prepared, in which all the Examples for Practice occurring in the Book-keeping are carefully written out, and in which the more difficult of the Commercial Cal- culations are made. The Key will be of advantage to Teachers in testing the accuracy of the work of classes, and may be of service tt the private learner. Entered according to Act of Congress, in the year 18&1, ^...HU. Jtj^.YiBT iTft. la the Clerk's Offl(&glte_pig|aaetj!quiui^th|"Bito of Uictaigan. t1E'roi&ieLCqu|UiCfe|"B!l Et IRA MATHETT, I860, ot of Uichlgaa. Entered according to Act of Congress, in the year 1880, By IRA MAYHEW, In the Office of the Librarian of Congress, at Washington. Xlui/rotyped an<2 Printei, by Band, Axery, & Oo., Boston. 4 FROM PREFACE TO FIRST EDITION. Agesij-aus, king of Sparta, being asked what things he thought most proper for boys to learn, very appropriately re- plied, " Those things which they should practice when they be. come men." Ever since it was said to Adam, " In the sweat of thy face shalt thou eat bread," there has been a necessity laid Upon man not only to IcAor, but to exchange with others the products of his industry, in order to obtain a comfortable sup- port. " Deliver all things in number and weight, and put all in writing that thou givest out or receivest in," is a precept of universal application ; and there is a special necessity for its observance in all business transactions between debtor and creditor. . . . Considerations are presented in the Introduc- tion to show some of the many advantages that would result to individuals and to the community from making Book- keeping a common study in all our schools. . . . FROM PREFACE TO SIXTIETH EDITION. Since the first publication of this work, the author and pub- lishers have received many testimonials in its favor, the strongest and most cordial of which have been from teachers who have used it, and business men and others who have Icnown the bene- fits resulting from its use. These testimonials are from teachers of public and private schools, from pdncipals of academies and ladies' seminaries, from state normal schools and colleges using it, and from city and state superintendents and boards of educa- tion. * * * Parts Second and Third are entirely new. • * • PEEMCE TO ONE HUNDEED AND FOETIETH EDITION. The present Revised Edition is received with increased favor. The author's University Book-keeping is commended to persons and schools requiring a fuller treatise. lEA MAYHEW. Betboit, Mich., 1880. CONTENTS. •PAGB Remarks to the Student. . . 7 AbbreriationB and Sig^B. . • 8 Buggestiona to Teachers. . . 9 Introduction 10-18 FABT FXECSIT. Gekgral Book-keeping. Debtor and Creditor 19 Transaction defined. . . . • 20 Account Books HA Mrst ^orm of Accounts. . . 21 The Lederer. 21 The Index 26 Illustrative Examples. ... 28-39 Cash Account 40-11 liules for Dr. and Cr. Entries. 46 Bills of Parcels 16-17 Accounts Current. 18-19 Bills Becejrable 50-53 Bills Payable 60-53 General Settlement. .... 51 Memorandum Book 55-59 Examples for Practice. . . . 60-71 Second Form of Accotmts. . 72 Illustrative Example. ... 73 Accounts Current 71-76 Examples for Practice. . . . 77-85 TTiird Form of Accounts. . . 86-89 Illustrative Example. . . . 90-103 Retrospect and Prospect. . . 101 Examples for Practice. ■ , . 105-121 Auxiliary Books 122-121 Books of Account 125 Xotes, Orders, and Receipts. . 125-127 Checks, Drafts, & Bills of Ex. 127-131 PABT SECOND. COMHERCIAL CALCDLATIONS. Percentage 132 Interest 133 Partial Payments 131 Computation of Time. . . . 135 Discount 135-136 PAOI Bank Discount 136-138 Exchange 138-110 Commis., Insurance, & Duties. 110 Equation of Payments. . . . 111-116 Storage, Dividends, & Losses. 117 Partnerships 147 PABT TBXRD. Philosophy & Uorals OFBuiuiESS. Choice of Business 14S Labor the Source of Wealth . 151 How Labor most Productive. 152 Benefits from Exchanges. . . 151 How Merchants are Useful. . 155 How Money facilitates Exch's. ISO Of Banks and Banking. ... 157 Banks of Deposit 158-162 Banks of Discount. .... 162-161 Savings Banks 164 Banks of Circulation 161 Quality and Functions of Money. 165 Commercial Banks 167 State Banks 168 Private Banks ]69 Recapitulation. 169-171 PART POUKTH. Double Entry Book-keepino. Definitionof Books used. . . 173 Rules for Journalizing. . , . 171-175 Classes of Accounts 175 Titles of Accounts. . . . .176-177 Posting Books 177 Trial Balance 178 Balancing Accoimts 179-182 Diagram for Closing Ledger. 183 Fourth Form of Accounts. , 185 Illustrative Example. . . . 185-197 Examples for Practice. . . . 198-213 Mfth Form of Accounts. . . 214 Illustrative Example. . . . 214-218 Sixth Form of Accounts. , . 219 Illustrative Example. . . . 219-223 6 TO THE STUDENT. From an attentive perusal of the following Introduction, you will see some of the many benefits resulting to persons engaged in the various departments of productive industry, from the study and practice of Book-keeping. Others will present themselves to your mind in your progress through the book. "While you can gain nothing by leaving a subject imper- fectly understood, you will lose much. You should hence let it be a settled rule with you never to proceed onward while any thing remains unconquered behind. In order, then, to facili- tate your progress in this important study, and to rend-er it of the greatest practical utility, you will do well constantly to bear in mind the following suggestions, until you shall have formed I correct habits in relation to the several particulars named : — 1. Make every arithmetical calculation yourself, as you pro- ceed. Rely not upon any result stated in the book, until you have first made the computation on which it depends ; other- wise, although the awthor may have derived some discipline from its preparation, you certainly will gain little from its perusal. What is worth doing at all, is worth doing well. 2. In solving the Examples for Practice, exercise your common sense in determining how each transaction is to be entered ; whether all on one side of the account, and if so, on which ; or a part on one side of the account and a part on the other. Bear in mind, also, that a transaction will sometimes require an entry to each of several accounts. 3. Spell every word correctly, and write neatly and legibly. 4. Study brevity and perspicuity in recording business transactions, and in all your business correspondence. 5. Accuracy in accounts is a cardinal virtue. It is less ditfi- cult to fall into errors than to correct them. Therefore, 6. Exercise all diligence to keep your Account Books neat, legible, promptly written up, and free from errors. ABBREVIATIONS AND SIGNS. Acct Account. Ami Amount. Ans Answer. Apr AiHril. Aiig August. S. or Bk. . . Bank. Bal Balance. Bbl Barrel. B B Bill Book, or Bank Book. B. P.. . . . Bills Payable. B. B . . . • Bills Receivable^ Bush Bushel. C. or C%. . . Cent. Cash. . I . . Cashier. C. B Cash Book. Cent (Centum) A himdred. Clk. . . . .Clerk. Co Company. O Creditor. Cult Hundred Weight. Z>.ord. . . .Day. D.B Day Book. Dee December. jHs Discount. Do (Ditto) The Same. Dolls. . . . Dollars. Doz Dozen. D.P..... Day Book Page. Dr Debtor. E. E. . . • • Errors Excepted. E. and O. E. Errors and Omissions Ex Example. [Excepted. Exs Expenses. Fav Favor. Feb February. Frt Freight. Ft Foot, or Feet. Gal Gallon. Sdkf. .... Handkerchief. Hhd Hogshead. JIund. . . . Hundred. /. or Jnv. . . Invoice. J.B Invoice Book. i.e That is. Ins Insurance. Tnt Interest. Invt Inventory. J. P. ... , Jonmal PBg«L Jan January. L. F.. . . . Ledger Folia M. or mo. . . Month. Afar. .... March. Mdse Merchandiaa No Number. JSov November. Oct October. P. orp. . . . Page. Pagt Payment. Pd Paid. Per orpr. . By the. Per am.. . .By the year. P and L. . . Profit and Loss. Pr Pair. Prem. . . . Premium. Ps Piece, or Pieoea. Pres President. Prm. .... Principal. S. B Sales Book. See Secretary. Sept, ..... September. Stg Sterling. Stmdt. . . . Sundries. TV Transaction. Viz To wit ; namely. T. or yr. . . Tear. Yds Yards. 4-, plus . • • Addition. — , minus . . Subtraction. =, eqiuU . . Equality. Xtinto. . . Multiplicatioil. -i-,by . . . . Division. : is to, I . . Proportion. •■■.as, ( . . 3 : 12 : : 5 : aO. 9 Dollars. IB Cents. £ Pounds Sterling. @ At, or to. % Per cent. " The same. 11 One and l-quarter. 1! One and 1-hnlf. V One and 3-quarter& 8 SUGGESTIONS TO TEACHERS. Book-keeping has not heretofore been a common branch of study in our schools, and teachers introducing it will hence often have occasion to instruct classes in what they have not themselves been taught. But this work, which has been pre- pared with reference thereto, and which assumes nothing as known that is not taught, while simple and progressive, is yet practical and thorough. Great care has been taken 1;o render the more difficult parts of the science clear and intelligible. Teachers of capacity and industry may hence as readily prepare themselves for giving instruction in it, with entire success, as in any other branch of study. The accotQpanying Account Books have been prepared with proper rulings, and of sufficient capacity for writing up the Examples for Practice in the various forms of account, introduced on pp. 60, 77, lOS, and 198. The Illustrative Examples which precede, may be worked out on separate sheets of paper, ruled by the pupil as the several forms require. It will be well, also, for the learner thus to work out the Examples for Practice in the diiferent forms of ac- count, before entering them in the Account Books. Although Keys are not generally desirable, still, m works constructed like this they seem unavoidable. The Key to this treatise, which contains the writing up of all the Ex- amples for Practice introduced into the book, with the solu- tion of the more difficult examples in Commercial Calcula- tions, will enable teachers who might otherwise shrink from the undertaking, to study and teach this important science with great satisfaction, both to themselves and to then: pupils and patrons. INTRODUCTION. Article 1. Book-keeping, which is the art of keeping accounts in such a manner that a person may at any time know the true state of his business, is necessary for every person engaged in the ordinary pursuits of life — for the day- laborer, the farmer, and the mechanic, as well as for profes- sional men, and persons engaged in mercantile and conmier- cial pursuits. 2. Were persons generally to keep correct accounts, they would be less likely to run into debt beyond their ability to pay; temptations to dishonesty would be diminished; there would be far less litigation among neighbors and those who have occasion to transact business with one another ; 'habits of industry, frugality, and integrity would become more gen- eral ; and in these and various other ways the social and moral virtues would be cultivated, and individuals generally, composing the community, would become more fraternal and humane. 3. As an illustration of the moral benefits that would result from keeping an exact account of one's personal ex- penses, it is sufficient to refer to the fact that individuals sometimes excuse themselves from keeping such an account, by saying it is not always pleasant to see, afterward, for what they have foolishly paid their money. This is doubt- less true of more persons than have the frankness to make the confession. Others are unwilling to let their books show QoEST. 1, What is Book-keeping ? For whom is it necessary? — 2. What bene- fits result from keeping correct accounts? — 3, What moral benelitaf WTio need the restraints of Book-keeping 7 Where, tlien, should it be studied, and hy whom i 10 INTRODUCTION. how, or for what, money or property has come into their possession. It can hardly be set down as uncharitable to infer that such love darkness rather than light, because their deeds are evil, and fear the light of correct entries, lest their deeds should be reproved. It must be apparent to every one, that all such persons need the restraints imposed by keeping an exact account of receipts and disbursements. Book-keeping, then, should be studied in -every common school in the country, (as well as in all our higher seminaries of learning,) by young persons of both sexes. 4. Heretofore Book-keeping has rarely been studied, except by young men who have expected to engage in mer- cantile and commercial pursuits. But were it understood and practiced by women as weU as by men, it would in many cases (and very properly too) render them more frugal in their personal and domestic expenses ; prevent vast accumu- lations of indebtedness ; diminish greatly the number of bankruptcies in the country ; and secure to families generally the benefits resulting from living within their means. It would, moreover, exert a healthful influence upon the mind, and afford rational employment for many upon whom time hangs heavily, or is worse than thrown away in idleness and thoughtless dissipation. 5. While upon the husband, father, or brother, rests the duty of providing for the necessities, comforts, and con- veniences of the family — upon the wife, daughter, or sister, devolves the scarcely less responsible ofiice of judiciously expending the means furnished, in so far at least as the weU- being of the household requires. This is by common con- sent regarded as coming within her appropriate sphere. It is, then, properly a part of the housewife's business to keep an account of all moneys expended by her for the benefit of QnzBT. 4. What benefits voiild resnlt to women and families from this study! -6. State benefits at length, from keeping household accounts. U INTBODUCTION. the fainily, or on its behalf. When she does this, she becomes more fully a helpmeet for man, than it is possible for her otherwise to be. Domestic broils and family feuds not un- frequently result, either from real or supposed scanty pro- vision on the part of the husband, or from alleged extravar gance on the part of the wife. In case an account of the family expenses is kept as here suggested, the wife can at any time render an account for aU moneys that have passed through her hands. Where the husband keeps a proper account of his business, it is hence easy to see when it may become necessary to curtail expenses in order to live within their means. It is evident, moreover, that under such cir- cumstances two whose destinies are united for life, can more rationally confer together in relation to the well-being of the household, than where no such accounts are kept. I may here also venture one additional suggestion intimately con- nected with the preceding. 6. The wife or daughter might, in many instances, very properly keep the books of the husband or father, whose time is absorbed in the pursuits of a laborious profession, and thus not only save the expense of a clerk, but transact the business of the household more satisfactorily, and have the pleasure of contributing to the comfort and happiness of the family, as well as to its pecuniary interests. Woman, when not otherwise employed, may also properly enter the counting-room, and engage with father and brothers in its quiet duties, for the discharge of which she is as well fitted by nature as they. She thus acquires a knowledge of busi- ness, and if bereft of husband or father, upon whom too many females are entirely dependent for support, she may be enabled herself to conduct the business advantageously, or to close it without loss. QoEST. 6. How may women aid in bufiinesB by keeping books? What of wonum lu the coouting-room ! May she learn to conduct a business herself t 12 INTBODUCTIOW. 7. Females, as heretofore generally educated, have been quite too dependent for a support upon their male relatives and friends, if such they chance to have. Frequently, too fi:«quently, alas ! there ie exhibited the painful spectacle of the widow, bereft of him to whom she has been accustomed to look for support and the maintenance of her little ones, ■without any knowledge of the ordinary forms of business, and hence not only without the means of procuring a com- petency for herself and children, but unable advantageously to assume the charge of any property she may chance to possess. Under such circumstances, few females, compara- tively, are prepared properly to conduct their own business. Losses, embarrassments, poverty, and not unfrequently the painful sense of dependence upon the cold charities of an unfeeling world, hasten those thus situated, who but yester- day were confiding and full of hope, ow to a premature death, leaving the world sorrowful and broken-hearted, chiefly be- cause of a defective education. How important it is, then,; that the study under consideration should receive the atten- tion of females as well as of males ! Especially should Book- keeping be regarded as an indispensable study in every young ladies' seminary. 8. The one great object which parents seek to attain in directing their children to enter upon the study of Arithmetic in our schools, and which youth have in view in entering upon it, is, that they may become the better qualified for the discharge of the ordinary duties of life and for the transaction of such business as they may have occasion to engage in. But if a portion of the time ordinarily given to this study were judiciously bestowed upon a practical system of General Book-keeping, this important object would be much more Quest. 7. In case of bereavement, which Is better, for widow and orphan to be oble to conduct the busineBS of the husband and father, or to depend upon friends? Should ladies learn Book-keeping ? — 8. Is this study of less importanoe than Arithmetic ? INTRODUCTION. speedily reached, and with vastly more pleasure to the learner. 9. I would not underrate the importance of arithmetic as a study in our primary institutions of learning. It has long and very properly been pursued, in all well regulated schools, by both boys and girls, whose education would be exceedingly defective without a familiar acquaintance with its principles and their application to the ordinary transactions of life. But it is apparent that a practical familiarity with the prin- ciples of General Book-keeping is of much greater impor- tance than the most perfect comprehension of the mysteries of square and cube root, of arithmetical and geometrical progression, of permutations and combinations, of the sum- mation of an infinite serieSj etc., to say nothing of the ex- ploded rules of single and double position, and many others that might be enumerated. 10. English Grammar, which is defined as the art of speaking and writing the English language with propriety and accuracy, is now very generally studied in our common schools. But in order to turn it to the greatest account, its principles should be practically applied, in the school-room, to accounts, and to the ordinary business transactions of life. 11. Much attention 'is now very properly paid to Penman- ship in our schools. But it should be borne in mind that the great mass of the people employ this art chiefly for the pur- pose of recording business transactions and in business cor- respondence. How important, then, that correct forms and habits in these respects be early acquired ! Pupils, it ought generally to be known, make the most rapid improvement in penmanship when engaged in writing something in which they are interested, and which they feel that they can after- Qdest. 9. Is Book-keepiDg of more practical importance tlian many of the rules of arithmetic? — 10, Wliat application Bhonld be made of tfae principles of Gram- mar f — 11, Ib Penmanship of much practical importance ? When will improrement in penmanship be most rapid 2 U nfTRODTJCTION. ward turn to practical account. It cannot fail to be apparent, then, that independently of the benefits already enumerated, pupils will make greater improvement in this useful art by devoting a portion of their time to practical accounts than by writing after set copies. 12. It is but a few years since Book-keeping has been taught, to any considerable extent, in any grade of Schools in the country. And it is not even now taught in Colleges or Universities ; nor is it embraced among the studies required to be pursued preparatory to admission to these institutions. As a consequence Graduates of Colleges and learned Pro- fessors are often less familiar with the simplest principles of business, than they are supposed to be with Latin and Greek roots, and with the orbits of the Planets and their Satellites ! • Within the last few years Book-keeping has become a study in many of our Public Schools, in both cities and villages, and in the country. But Book-keeping by Double Entry is not less attractive as a Science, nor is it less important as a means of discipline, than are Geometry, Chemistry, and Natural Philosophy, or even Latin, Greek, and Astronomy. Add to this its practical importance, and absolute necessity in a commercial country, like ours, and the propriety of its in- troduction into our higher Seminaries of Learning generally must be apparent. Certain it is that no person can properly be regarded as liberaHy educated who is unacquainted with it. 13. The author of this treatise, in the execution of a plan laid many years ago, and practically tested in the school-room, * A popular writer on edncatloo remarks that a teacber, who had kept a private school, waB met in a country store by one of his patrons, who paid him for the tui- tion of bis child, asking at the same time for a receipt. The teacher stared vacantly at bis patron. " Just give me a bit of paper," said the patron, "to show you've got the money." "Oh, yes, sir," said the teacher; and taking a pen and paper, wrote the following : flS" " I have got the money. J — ~ Quest. 12. How does Book-keeping rank, in point of importance, with branches commonly taught in schools! Is a knowledge of Book-keeping necessary to a liberal education! 16 INTKODUCTION. has sought to supply what many practical teachers with whom he has compared views upon the subject in various portions of the country, have hitherto considered a desideratum. > The study of this work may be advantageously commenced as soon as the pupil is familiar with the fundamental rules of arithmetic ; and it may be successfully prosecuted in connec- tion with any of the branches of an English education. The following are some of its distinguishing characteristics : • 1. Before introducing the pupil to accounts in which debit and credit entries occur, which is usually the first thing done in treatises on Book-keeping, a business transaction is de- fined, and the mode of entering the same in the books of both debtor and creditor illustrated. Several transactions are then stated, in various phraseology, and the entries to be made in the books of both parties further exemplified. These entries — which are in all cases made in script that closely resembles writing — afford good models for the learner. Then, in the first example of accounts that is presented, the transactions entered are on the same folio stated in common language, which enables the learner ftilly to comprehend the whole matter. 2. After giving a few specimens of the mode of keeping accounts by the first and simplest form, together with the necessary instructions to the learner, a series of business transactions, drawn from the ordinary pursuits of life, are introduced, in the form of problems to he solved. In their solution it becomes necessary, from inspecting the transac- tions, merely, to compute the value of whatever has been bought or sold, the price and the quantity being given ; to make the requisite debit and credit entries, after first deter- mining to which side of the account each transaction belongs ; and then to balance the several accounts, which are to be * Sines the first publication of this woA, in 1861, other TOlnmes on the same sub- ject have been printed, in which some of these distinguishing features have been copied ; but in no other work, so ikr as the writer knows, can they all be found. New features of interest are also introduced into this revised edition. 16 INTKODUCTION. written out like the patterns already set, and entered in a blank book prepared for that purpose. 3. Numerous Examples for Practice are likewise intro- duced in each of the five remaining forms of account, with accompanying blank Account Books appropriately ruled, in which they are to be entered when solved. These blank books contain engraved Forms for writing up Day Book, Journal, and Ledger, and for Notes, Drafts, and Bills of Exchange, with business forms generally, and may hence advantageously be employed as writing-books. ■4. The instructions in relation to the mode of keeping accounts, which will be found sufiiciently full for all ordinary purposes, even in the simplest forms, are generally given on the same page or folio with the illustrative examples, with carefully prepared questions for the examination of classes. 5. For the convenience of Teachers in examining the work of their classes, as well as for the encouragement of the private learner, a Key has been prepared to accompany thip work, in which all the Examples for Practice are correctly entered in the various books used, and the accounts balanced and closed, so that no teacher, however inexperienced in keeping accounts, need shrink from undertaking to prepare himself for instructing classes in the use of this book. 6. The present Revised Edition of this work, while it re- tains the simplicity and gradually progressive character of former editions, is more complete than they were, and especially in Double Entry. The Diagram exhibiting the mode of closing accounts, p. 183, wiU enable the learner readily to comprehend what has hitherto been justly regarded as the most difficult feature of Double Entry Book-keeping. 7. The Examples for Practice, interspersed throughout the work, give the pupil the benefit of combining the Theory and Practice of accounts, and of deriving at once the advantages of both school-room and counting-room. 8. All the real advantages of printing in colors are incor- 2* 17 INTRODUCTION. porated into this edition, and still it is furnished at an unpre- cedentedly low price for a complete treatise on Book-keeping. These characteristics are believed to be peculiar to this work. They make the whole subject perfectly intelligible to the intermediate classes in our common schools, as well as to those more advanced, and invest it with so much of interest as to render it highly attractive. In its use, it is confidently believed scholars will more rapidly acquire that facility in making business computations which is most desirable, than by devoting the same time exclusively to the study of arith- metic, as has hitherto been generally practiced; that they will make greater proficiency in penmanship than though an equal amount of time were devoted to writing after set copies ; and that they will at the same time more readily acquire a thorough and practical knowledge of Book-keeping than from the study of any work that has heretofore been given to the public. So, view it in what light we may, the ad- vantages arising from the study of Book-keeping, with the improved methods here presented, are too great and too nu- merous to allow much time to elapse before its general introduction into all our common, intermediate, and high schools. Note. By referring to the opinions of Teachers who have used this hook, and of Practical Educat'Ors who have carefully examiued its claims, it will be seen that the views of the author, as here expressed, are regarded aa fully realized by those who bavo givea most attention to the sul^ect, and are competent to judge. 18 PART FIRST. GENERAL BOOK-KEEPING. Aet. 14. Book-keeping- is the art of keeping accounts in such, a manner that a person may at any time know the true state of his business, or of his debts and credits, by an inspection of his books. The term General Book-keeping signifies that kind of book-keeping which is suitable for per- sons generally, such as farmers, mechanics, professional men, retailers, and, indeed, all persons except merchants engaged in a wholesale business. 15. Were persons universally to receive an equivalent for their wares when sold, and were they enabled to pay at the time for whatever they have occasion to purchase, it would still be desirable to keep a record of their business transactions. This necessity becomes imperative whenever products and goods are bought and sold without making pay- ment at the time. DEBTOR AND CREDITOR. 16. Whenever one person receives any thing from an- other, which he does not pay for at the time, he is said to go in debt for it, and is called a Debtor. A person who sells property without receiving his pay at the time, is said to give credit for it, and is called a Creditor. In other words, the receiver is always the Debtor, and the giver is always the Creditor. In keeping accounts it is customary, and more QnliST. 14. What is Book-keeping! What is meant by General Book-keeping f 15. Ib it always desirable to keep a record of business transactions? When does this necessity become imperative F — 16. When does a person become a Debtor? Vv hen a Creditor? When property exchanges hands without payment being made at the time, what general rule is stated in relation to the receiver and giver of it? 19 GENERAL BOOK-KEEPING. convenient, to abridge and write Dr. for Debtor, and Cr. foi Creditor. 17. The act of buying or selling is called a Transaction. In eveiy transaction there must be both a buyer and a seller. Where the property which exchanges hands is not paid for at the time of the transfer, the buyer becomes a Debtor, and the seller a Creditor. The following will serve as an illustration of the correct use of the terms already employed : Tbansaction. — James Armitage buys of Isaac Merrill one pair of Kip Boots, for which he is to pay him four dollars. In this transaction James Armitage is the Debtor, because he is the receiver ,• and Isaac MerriU is the Creditor, because he is the giver; or, in other words, the furnisher. The parties make the following entries in their respective books, under the date of the transaction : Isaac Merrill writes in his book, Jatne* ^MMtUaqe, Q2it. <^o tme ^^ o^ e^ SSooi*. . . 0A.OO James Armitage writes in his book, ^y one ^^ ^©^ 0Sooti, . . . ^4.00 18. By examining these entries the pupil will see that the creditor writes the debtor's name in his book, and that the debtor writes the creditor's name in his book. This should be remembered, for it constitutes an invariable rule. 19. The word e remembered 7 — 19. What does the word To, with which the creditor commencea the entry in his book, indicate 7 What tiia word B^i with which the debtor commences the entry in Ills book? 20 GENERAL BOOK-KEEPING. debtor commences the entry in his book, the reception % him of that which the creditor has charged to him. In other words, the ^o, on the Dr; side of an account, indicates in- debtedness to us from the person named in the account ; and the ^y, on the Cr. side of the account, indicates indebted- ness h) us to the person named in the account. 20. The foUowmg examples will further illustrate the mode of entering transactions in the books of both debtor and creditor, with which the pupil should become familiar before progressing further. For this purpose separate sheets of paper may be used. Let the pupil write the transactions on one page, numbering them, and make the proper entries on another page, with their corresponding numbers and cor- rect dates, as in the annexed examples. The transactions may be copied from the book. The entries should be made like those in the examples given : but they should be made from an examination of the transaction ; not copied from the book. The pupil might also write out additional transac- tions, and having studied them carefully, be prepared in recitation to give the entries either on the blackboard, in writing, or orally, all of which methods might in turn be practiced. 21. The price and the quantity being given, the learner should, from the first, invariably compute the vahte of all articles bought or sold, whether the calculations are made in the book or not. It would be to his advantage to do this in studying any treatise on Book-keeping. But in the use of this work it becomes absolutely necessary ; for the pupil will soon be called upon to record transactions where such com- putations are unavoidable. Quest. 20. Should emlbriei be copied from the hook ? How should they be made ? — 21. What computations should the learner invariably make ? Are such compu- tations avoidable in the study of this treatise? State the jirst transaction, and give the entries to be made in the hooks of both parties. State the second transaction and the entries. The third, etc. Let the pupil State additional transactions, and give the entries orally, or on the blackboard. 21 SETERAL TRANSACTIONS: Transaction 1. January 1st, 1880. James Armitage buys of Isaac Merrill one pair of Kip boots, for which he is to pay him four dollars. James Armitage is the debtor, because he is the receiver, Isaac Merrill is the creditor, because he is the giver. Transaction 2. Januart 2d, 1880. Hallock & Raymond sell to John S. Barry one suit of clothes, for which he is to pay them fifly-two dollars. John S. Barry is the debtor, because he is the receiver. Hallock & Raymond are the creditors, because they are the givers, or the sellers. TRANSACiftON 3. January 3d, 1880. William H. Boyd sells to Charles 6. Johnson 40 lbs. of nails, for six cents a pound. C. G. Johnson is the debtor, because he is the receiver. Wm. H. Boyd is the creditor, because he is the giver. Transaction 4. January 4th, 1880. Alex. McFarren buys of Harper & Brothers 4 dozen copies of Mayhew on Education, at $9.00 a dozen. Alex. McFarren is the debtor, because he is the receiver. Harper & Brothers are the creditors, because they are the givers, or the sellers. 22 liio. MODE OF ENTERING TUKM. t Isaac Merrill writes in his book, a^- -f /vinea G/Cimtiaae, , . , , Q)z, &. Q^S^aiien, .... ^z. &o 4 e&xo. Q/May^etu om/ Sc^ n, p.OO 36 00 Alex. McFarren writes in his book. B /^. 4 Sl^Mfw^ ^^tadez^, ... ^t. S^ 4 c&xs. eStydew o^ Sd'n, p.OO 36 00 23 GENERAL BOOK-KEEPING. ACCOUNT BOOKS. 22. The number of books necessary for use, and the par- ticular mode of keeping one's accounts, must depend upon the nature and extent of his business. Forms are sometimes given for Farmers ; others, for Mechanics ; and others still, for Merchants. But so great is the difference in the extent and variey of business carried on by these and other classes of persons, that some farmers find it desirable to keep a greater number of books than are requisite for mechanics ; and other farmers, and mechanics, not unfrequently do a more varied and extensive business than is sometimes carried on by the merchant. In a treatise on General Book-keeping, then, it seems befitting to commence with the simplest form of accounts, which will be found convenient for persons en- gaged in a limited business of almost any kind, and afterward introduce others, and leave persons to select the form they shall deem best adapted to their particular business, taking into the account both its nature and extent. 23. Three forms for keeping accounts are presented, in this treatise, in Single £ntry, and three in Double Entry. FIRST FORM OF ACCOUNTS. 24. The Ledgeb, which is indispensable, even where the Day Book and Journal are used as preliminary books, is the most important book in General Book-keeping, and the only one necessary in the first form of accounts. Its object is to show how the owner of the book stands toward the various persons with whom he has credit transactions. Quest. 22. Upon what must the nnmber of books used and the mode of keeping one's account depend! Why cannot particniar forms he prescribed fbr Farmers, Mechanics, and Merchants ? — 23. Hot many forms for keeping accounts are given in this treatise? — 24. What book only is necessary in the first form? Can the Ledger be dispensed with when the Day Book and Journal are used as prelimioazy tuoks ! What is the object of the Ledger I 24 GENERAL BOOK-KEEPING. 25. Two pages opposite each other are appropriated for each individual account. The name of each person with whom we open an account (and his residence when this is necessary to identify him) should be written in a bold hand at the top of the page, or at the head of the account, for a title, as in the annexed examples. 26. The left-hand page is devoted to the Dr. entries of the account, and the right-hand page to the Cr. entries. It should be borne in mind that the word <^, which com- mences each entry on the Dr. side of an account, indicates indebtedness to us, from the person whose name stands at the head of the account ; and that the word ^^, which com- mences each entry on the Cr. side of an account, indicates indebtedness hy us, to the person with whom we keep the account. (Art. 19.) 27. The words (^ and 0Su, as signs of Dr. and Cr. en- tries, are sometimes omitted, in both Single and Double Entry ; and the Dr. and Cr. sides of an account are often both kept on the same page, though not in this form of accounts. But in every form of accounts two sets of money columns are required. The left-hand set is uniformly employed for Dr. entries, and the right-hand set for Cr. entries. 28. In the first form of accounts each page is divided by perpendicular lines into five spaces ; in the first of which, commencing at the left-hand, the year and month are en- tered ; in the second, the day of the month ; in the third, the items bought or sold ; and in the fourth and fifth, their value in dollars and cents. Qttrst. 25. What space is appropriated to an account in the first form ? What should be written at the head of each person's account i When should the resi- dence of a person he given in the title of his account ? — 26. When two pages are appropriated to an account, which is devoted to the Dr. entries? Which to the Cr. entries? What is said of the words 2b and Byt — 27. ^^^ these words ever omitted ? How many sets of money columns are always required ? How are they employed ? — • 28. Into how many spaces is each page divided, and what should be entered in the several spaces ? 3 26 GENEKAL BOOK-KEEPING. 29. Wlien a person has occasion to use several Ledgers, as all do who engage extensively in business, it is customary to' designate them by the letters of the alphabet, thus : Ledger A ; Ledger B ; etc. Different Ledgers are likewise frequently employed by persons at the same time, when en- gaged in an extended and varied business, separate Ledgers being devoted to retail sales, and to different branches of one's business. In such cases the results of these smaller Ledgers are periodically carried to the principal Ledger. THE INDEX. 30. The Index is a small book in which the names of all persons having accounts in the Ledger, and the titles of ac- counts other than personal, are arranged in alphabetical order, under their initial letters, with reference to the folios or pages in which they stand. When small Ledgers are employed the Index may be conveniently written in a few of the first pages of the Ledger : but where large Ledgers are used, it wiQ be found more convenient to employ a sep- arate Index. When an account is transferred from one folio to another, as in the case of Henry Van Allen, both folios should be noted in the Index. This account, originally kept on the 8th folio, has been carried to the 9th. QuiST. 29. When a person has aeverar Ledgers, how are they usually designated ? When are dijferent Ledgers employed at the same time ? Where are the results of these Ledgers carried? — 30. What is the Index? When may it he kept in the Ledger ? When an account is transferred to a new folio what should be noted in tiu Ina«x! ae INDEX TO LEDGER A. A , ^&ra,m,ite/ S L M i B Jodn, 4 3 N c 7 6 PQ D E R S F G T U V ^.9 H I w ^deae e/tccotMte 5 J K X Y Z 97 £ime^ ^^zoze^n/ • ^^z. II QSec. 5 40 S II 40 ^/fd. ©^^ ^ , . II 4 &(meMi^ ^iam e^ ^naea . / 76 y^^ » " / =^»»A "Wa^on, . . . 50 00 e/Vo». ^0 " ^^e^taiitM &%iad 4 50 // 45 " ^doemy S^nAe: .... / S5 57 50 becomes the giver, or furnisher, and I the receiver. I hence credit him accordingly. Tr. 6. Nov. 10th. James Brown repairs my Sleigh, for which he charges me $4.50. In this transaction, as in the last, he is the giver, and I am the receiver, and I hence credit him with the amount of the work done. Tr. 7. Nov. 15th. Here James Brown shoes one of my horses, and the entry exhibits the necessary credit. 32. Settlement. Dec. 28t}i. Accounts should be settled at least once every year. As, then, the end of the year ap- proaches, I call on James Brown for my annual settlement with him. We first add the sums in the money columns of the credit side of the account, and find they amount to $57.50, which is the sum total of all I have received from him. We next add the sums in the money columns of the debit side, and find they amount to $45.50, which is the sum total of all I have let him have. We then subtract the amount of the debits from the amount of the credits. This gives a remain- der of $12.00, which is the amount of my indebtedness to him. I pay him this sum, and debit him " To Cash to Bal- ance, $12.00." Finally, I draw single lines under the money columns, and after adding them and placing the amount, $57.50, under each, draw double lines beneath, to show that the account is balanced and closed. QnzsT. 31. What the sixth transaction and entry? Seventh, and entry! — 32. How often should acconnts'be settled? How is this account settled and cloaedl 3* 29 fMO. ^0 f5 46 ^ 75 SSu^. ^Aeat . . . Jo " io " '^ovn. . . . .40 " 40 " 0i)tatoe4 . , . .35 60 3S f4 00 00 00 4M^. 406 00 c^- ^o ^a^iMce /isiwe me/ i 47 33. The foregoing is an account with Samuel Adams, a Retail Merchant. I have sold him produce at three different times, amounting in all to $106.00. Dec. 31. — I call on him for settlement. By adding the sums credited to him, we find they amount to $97.83. By subtracting this sum from the amount of his debits, it appears there is due me $8.17. As I have no occasion to use either money or goods at this time, and expect to do my trading with him another year, the ac- count is balanced as follows: I credit him "By Balance, $8.17." This done, the debits and credits amount to the same. I now draw single lines under the money columns, directly opposite each other, as before, placing the amount under them, and drawing the double lines beneath, to signify that the account has been examined and found correct. The $8.17 is entered in different type from the rest of the ac- QuEgT, 33. Hov is the account with Samuel AdazDB settled 7 What of the balanoel f- (^fcMntee/ G^ccMitM t^. t^^a - / cti. /a^. 4 ^f J-J ^. .33>a/<^a^ ./i" J" Si // iO // S% fd,. SSzo€U&>^ . . Xtfd? 9 00 //■ /J // S% " ^oMtmete ^.tff? 5 50 // // // &t^>nmmad «&» '^oat and ^eat S 75 Sfe/!. 4 // S'f ^. ^4eet^ . . . .// S 3i // // // 'f^.^Acd^ea, . . . 75 Q/^. /i- // ^Jfo/^toM^ . . . /J" 70 // // // J"*? ^«i ^^ . . . .^5' ;' 50 // // // ^«. c&>. 6 00 /' /■■ // efmtezeAtae0SO fret Q^^me . .07 S5 90 // // // Profit on the Crop 70 20 S36 SO 39. The ahove is an account with a Wheatfield of 18 acres, from which it appears that the net profit (after paying the interest on the value of the land, and all the expenses of raising the crop) is seventy dollars and twenty cents. The account is kept just as an account with a person is : The field is debited with every thing put upon it, with every ex- pense made on its account, and with the interest on the land at a fair valuation. It is credited with every thing it pro- duces, and with every thing received on its account. The excess of the credits over the debits gives the net profit, which must be entered on the Dr. side of the account in order to balance. (Art. 33.) Accounts may be kept in like manner with every branch of one's business, whether agri- cultural, mechanical, commercial, or speculative. QossT. 39. In the account with a Wheatfield of IS acres, what is the net profit J How is the account kept? With what is the field debited, and with what credited! How is the net profit aacertained ? With what kinds of business may accounts be leapt in this way % 8t ^'em, -fa Gzc^ed ^t.^ fiio. ^y3a^u^4e£, -W^eai . . .70 ^5 S36 SO 00 40. Were persons generally to keep such accounts, they could ascertain, with great accuracy, what pursuits afford certain profits, and what particular department of their busi- ness is most lucrative ; also, what enterprises are hazardous and unproductive ; and, by regulating themselves accordingly, they would of course best promote their own pecuniary in- terests, and at the same time contribute most effectually to advance the general prosperity of the community in which they live. (Arts. 218 to 225.) 41. When the debits in such an account exceed the credits, and it becomes necessary in balancing the account to make the last entry on the Cr. side, it is evident the enter- prise is attended with hss, as is exemplified in the account with a Grain Speciilator on the next folio. Quest, 40. What advantages would resalfc to the individnal and to the commu- nity if persons generally were to keep such accounts? — 41. When the debits i* such an account exceed the credits, is the enterprise attended wltli gain pr ipss / ea^ &€ccou7i,^ ^i)z. /Srp. / Cti, &¥ov. /«? ^c '^a^^^O.OOOWuA.'Wieai .7S 7200 00 // // // '^4tM^ ta G/^iomoe ^ ^u. .^5 •fSOO 00 fMo. ©^. 20 // ^doMiM ai S^umtoe cio, .04 400 00 // // // STnatviamce aaamai e^me \i ^et cent. 43 50 J/ S7 // .^Je ^te^ U ^«/^ .03 300 00 // // // e^atme e^utnance \i ^ei cent. 43 50 Q/^a^ 40 // '^om. /ot ^6&i^at^i^i& .Of fOO 00 / // // SnxdcMiae om 0^700 ai ^A ^tei ceni. 43 SO // // // e^lmeai on acMne /m 6 moa. .07 304 50 9935 00 1 42. Above is the account of a Grain Speculator, who made a purchase in Southern Michigan, the 10th of Nov., with the expectation of getting the same forward to Bufialo, making sales at 97 cents, and getting returns in two weeks. Had he realized his expectations he would have reduced the cost of the wheat to him in Buffalo, one cent per bushel of the charges in Monroe on account of storage for the winter, 4^79- eA^ov. /(? ^ ^^4 ft 40.000 ^a^.lS(%at .72 7200 00 // // " '^dent^ to &^(imtoe fiet ^u. .'fS ■f500 00 1' S4 " «6. at «!&. al&. .03 300 00 ^/ // " .S^i^ ^taioM emcl &^a/i»ne qAm. 343 50 // 1/ " 'WtymanMMom oMci SxcMbnae ■f43 50 rr 1/ " ofntete^ on 0^700 ^ M mont£ .07 25 37 // // " Amount to Balance (Gain) . . . 187 63 9700 00 Quest. 42. — What was lost by r Grain Speculator tn the Wheat Account here veni given G^ccoun^ ^^. ^ 5 ^0 ^y e^Ueeci^ c/ MOO S^u. ^ieai J/V, " e&. ■ 6000 e&t. .ir " Amount to Balance (Loss) / 3500 5SS0 1215 00 00 00 9935 00 ' the insurance against fire, and 5^ months interest — amounting in all to $422.63 And his receipts would have been greater by . 980.00 Making an actup,! difference in the result of . . $1402.63 Hoping to gain $187.63, as appears from his figuring below, before engaging in the enterprise, he actually hst $1215.00, as appears from the account as given above. *^79- S5 ^utn^ on f 0,000 8Stt. ■i.pr Noix. In order to exhibit this account complete on one folio, the Lake Freight and Marine Insurance in the opposite entries, (which are the same as in the above account) are combined; also the charges for Commission and Exchange. 9700 9700 00 00 QufiST. 42. What had he hoped to gain ? What difference, and how made up ? 4 87 ^ozn/e^, ^ Q^cze^ ^^- 4879' / eta. ©^2. ji^ <^o Ji y^Ji^ =^«a6 e^Kamitte . .S5 3 50 6 4 00 50 if 'fy^ ^ci. (^eeti ^om. . . .50 S S5 63 // // /' A Qiaya 0^/0^0^ . . . .75 3 00 / S c&>. ^a^tataim^ . . ^.50 S e^. c^. . . 4.50 3 3 00 00 // // // § e^. 0'^yuf^ . . . 4.50 5i4 eio. '^uOMi^ amcl ^%>c£tii^ .75 3 SO i 00 00 00 00 // // ■ // ^diead^iOO ^u. ^otn . .04% e^tdeiL^ elo. eio. . .04% e/ntBiaa at 0SO jkm G/Cae . /)7 4S 4S 44 00 00 SO // // ■ // Profit on the Crop . 255 92 349 00 43. The profit on this crop of Com is very great, as is shown by the last entry on the Dr. side of the account ; but then, the soil that produced it was very fruitful, and required but a small amount of labor in cultivation. Com, moreover, usually requires twice hoeing ; but this, which was raised on the River Raisin, in Monroe county, Michigan, was not hoed at all. It was "cultivated" between the rows, in one direction, the 20th of May, and in the other direction the Quest. 43. Here Is presented an account with a crop of corn of eight acres. What Is the profit on the crop 7 How are this large yield and consequent profit accounted fax% How was the field cultivated? opn^d^, (Y G^c czed ^9. ^e^. ^0 f5 " /^ c^. eio. ^ ^otleU 4.00 " iOO ^ati^eU <^om. . . .40 45 3S0 349 00 00 00 00 1st of June; and it was plowed out once only, without hoe- ing, on the 15th day of the latter month. This mode of culture, and this yield, are common in the new States. 44. This crop was debited with only one-fourth the ex- pense of manuring, because the land was permanently enriched, and the benefit will probably be realized in the next three crops to as great an' extent as in this. It is hence apparent that but one-fourth of the expense of enriching should be debited to this crop. QmsT. 44. Why was not this crop debited vith the whole expense of enriching F on H^add ^iio. / aa. ^c^. / (^^ ^^flfrfjfe O^ n£&9l€C , , , ^ /^. 50 // 4 " 4 '^otd, ^Whod . . . . 'f.50 6 00 // fO , S.OO SO 00 If ■fS " ^4 "^oui, C^ao^^ . , . f^SO i-/ 00 fj S3 // 2 ^. &'oti . . . . 9-00 /^ 00 79 50 ^j. (^0 ^a&Mice ^touoM clown 3^ T? 45. An account may and should be kept with Cash, the same as with an individual, as in the above example. Per- sons who have a limited cash deal may keep their Cash Ac- count in the Ledger, and in the same manner they do their personal accounts. But when one's cash account is extensive, or the entries in it become frequent and numerous, it wiU be best to keep the account in a separate. Cash Book provided for that purpose, which should be balanced at the close of each day. In opening the account, Cash should be debited with the amount on hand. All moneys received should be entered on the Dr. side of the Cash account, and all moneys ■paid ottt, on the Cr. side of the account. In balancing the account. Cash should be credited with the amount on hand. But as this amount is not paid out, it is here entered in different type, and usually in red ink, to denote that fact. Cash is then debited for the balance. 46. The amount on hand at the opening of an account with Cash, together with the sums received at different times, Quest. 45. How may an account be kept with Cash? When may the Cash account be kept in the Ledger? When ehould a separate Gash Book he provided ? With what should Cash he debited on opening the account ? What entries are made on the Dr. and what on the Gr. side of the account ? What credit should be made in balancing the account ? Why is this entry made in diiferent type? — 46. What amoauts should be equal ? What do the Dr. and what the Gr. entries show ? 40 ^^Orfd ^ f^^O. c^- 3 J/ 7 J/ •fO jr // // S4 tl 34 &^eaa " Balance on hand / ■ eta. 63 .07 70 7 50 /^ 00 7fiO 44 00 • 38 67 ;-;' 50 should exactly equal the amount of the sums paid oWt and the cash on hand at the time of balancing the account. . The Dr. entries show what Cash has been received for, and the Gr. entries show what Cash has been paid for. 47. The first entry in the Cash account must always be on the Dr. side ; for no person can pay out money unless he first has it on hand. It is likewise apparent that the credit entries in the Cash account can never exceed the amount of the debit entries. When these are exactly equal, there can be no Cash on hand. When the Dr. side of the account amounts to more than the Cr. side, the difference, if the account has been correctly kept, will exactly equal the Cash on hand. 48. An account may be balanced and continued on the same page, or two accounti may be kept on the same folio, as in the following examples, according to circumstances. Whenever a folio is filled, and the account not closed, the two sides of the account should be added and the amount carried to some other folio designated. (See example on the next folio.) Quest. 47. Where must the first entry be made in the Cash Account! Whyf Can the credit entries ever exceed the debit entries ? When the Dr. side amounts to more than the Cr. side, what should the dififereuce be equal to ? — 48. When an ac^ count is settled, may it be reopened on the same page 1 May two accounts be kept on the ■ame folio ? When a tblio is filled and the account not closed, what should be done! 1* 41 fS7^ On. /o 4 <^o /<7 X. SSuOei . . . . ./5 f 50 " ^$ " 1 S% f^. ^«?a^£^fz <«/ 4.00 9 00 // // " S\i ^4i, '^a.ui^mme^i 'S^anU S.30 5 75 J/ // " ^uhn^,v^ ^ <^«.a^&de6 4 S5 S^J. 4 " 40 X. ^tcwn ^u^/iez "W^ .oi 3 SO // // " / ^?^ ^4ea^, 30\i ^. 40 3 05 rl // " fO f4i. ©^ Sie =^*iM . .34 3 40 // // 34 e^ 9 " 4 ^. e/f*i/=^J«» , , .56 S 24 // Amount to folio £ .SO 1 30 34 50 az^m> em?^ ^c/afi mz. f^79. ^ / cij. 4 /f S .oi 6 40 4^ 70 50 00 /I 30 " /(?. 4m . .40 .06 3 40 60 1/ 1/ " / .'-&itt«^co9n(, fl!^. 44 5S 02 ^i^o. Ja». / 8€y ^a&mce otoaahi t&nvm , 4 7S 4 / S6 .09 / 74 76 63 i3 99 1 ■92, ?«. fi0o. 40 SSy SO ^u^4e/^ c/ "WUu . . .75 y^ See this account at the 73d page, / kept by the Second Form. y^ Amount to folio 9 45 00 45 00 ., , — ■ 43 ^^^u m^ e^^ ^^ 4^0. / etd. // // fO ^o Gi^motmt /tow. j^>&! i 34 56 II II sry, /.S5 SO 75 00 II // II / S5 My 4 II II II S ^aU ^ea/ 9&a<, . . ./4 3 / 30 96 63 II '/O II S4 " .^men ^Omonam .35 3 SO IJ // II .3/ 7 44 &ct. /i" II A " ^zotu^£>id. 3.00 42 00 // // II /H ^'X'- ^iMono . . . .S5 sp II // II (St^mmaa hei ^iu . 4S S5 94 ^7 ' 49. This account is here continued from the preceding folio. It might have been carried to any other, as well as brought here, by making the proper entry at the foot of the page from which it is brought, showing th ^ folio upon which it is continued. 50. The books of the Creditor should specify every item sold. This is always important, and especially so when the entries are of considerable amount. The last entry on tbe Dr. side of this account with H. Van Allen is hence radically defective, not a single article debited being specified. The Bill, if purchased by any other person than himself, may never reach him ; or if it does, it may be mislaid, and in the settlement it may be impossible to satisfy him that this amount has ever been received by him, or on his account. The Debtor may give credit for goods as per bill received, if' he choose to do so, as in the case of a " Bill of Crockery " in Quest. 60. What should the books of the Creditor specify ? What of the last Dr. entry in the account ¥rith H. Van Allen ? May the Debtor K^^e credit in hia books per b.U received ? In such cases what should be done with the bill ? (^femu ^em. C5€^ '7 'e^t, ^i^o. 0ec. gee this account at the TSd page, kept by the Second Form, 45 94 00 30 57 the account with John Martin on the last folio, and as is twice done in the account with Samuel Adams — once for a " Bill of Crockery,'' and once for a " Bill of Goods for John Bruce." But even in such cases, to prevent any occasion for difficulty, it is better to preserve bills until the accounts are settled. 51. If on the Dr. side of my account with a person, I enter " To Bill of Goods," and carry out only the amount, he may not give me any credit at all, and on settlement he may dispute the account, and I may then be unable to specify a single article sold him. On the contrary, if I enter on the Cr. side of my account with a person, " By Bill of Goods," and give the amount, I thereby acknowledge the receipt of the amount; but in case the books do not exactly agree, difficulties may still arise in the settlement, if the bill is not preserved so as to compare items. The following rule should be observed for Dr. and Cr. entries : Qotst. 51. Why should the items sold be speclfled in the books of the Creditor, TVlien they may be entered per bill in the books of the Debtor ? 45 GENEBAL BOOE.-KEEFIN&. RULE FOR DR. AND CR. ENTRIES. 52. The Books of the Creditor should specify both the quantity and the value of every article sold. The Books of the Debtor should likewise specify both the quantity and the value of every article bought by him, unless hills are received of goods purchased, which is always preferaUe. When bills are given, the holder of them may enter the amount only in hia account, but he should keep the bills on file until settlement. BILLS OF PARCELS. 53. A Bill of Parcels is. a statement ofgoods bought or sold at one time, embracing both the quantity and the price of each article, and the amount of the whole. If paid at the time of purchase, it should be receipted by the seller, as in the first example on the opposite page ; if paid " by note," as in the second example ; and if "charged in account," it should be entered as in the third example. 54. In case goods are paid for in money when purchased, it is sufficient for each party to enter the transaction in his Cash account. But even then, if there is a personal account between the parties, the merchant should debit the purchaser for the goods sold, and credit him for the money received. 55. When payment is made "by note," the merchant should make the necessary entry under the head of BUls Receivable, and the purchaser under the head of Bills Pay- able ; and in case there is an account between the parties the whole transaction should be shown. (Art. 54.) But 56. When a biU of goods is " charged in account," the merchant should simply debit the purchaser with the items sold, which should be credited in the books of the latter. Qdist. 52. What rule is given for making Dr. and Or. entries ! — 53. What is a bill of parcels? — 54. When goods are paid for at the time of purchase, what entries should be made in the books of each party f — 55. When payment is made "by note," what entries should be made? — 56. When a bill of goods is "chuged in account," what entries should the parties make in their books ? BILLS OP PARCELS. (1) so ^. / // Goods to hir ^tam,^ SSaaa, ai . . .3'f .... 7.4A o^ ^zown ^'it^ . .07 ... . 'f.40 Mae ..... .05 . . .70 ^Ud <^^ . . . • -75 Mecewed ielivered \ ed man. \ 0fO.S9 (2) m / // // S W'sta ^a^ema. (S^uceta 50 S^e£. 4 // 45 ^. <^a/^ . .45 s S5 /-/ // // 3M " S^/anne/ . .SO 50 // // // 3 ^k^u, f/g^ . .40 30 // 4 // // 4 ^. ^0^ . . .43 •(S So' ^toum ^u^t, .09 / 5S oi 06 65 iMo. / 40 S^el 40 X. ^uOei . .44 &^(ay fO '-^add fiei aom '^^eotaa ■ 4 60 Balance due me . (Art. 33.) 3 65 06 65 EXAMPLES POB PRACTICE. 58. In the following examples, where several articles of the same kind are bought or sold, the price and the qiiantity are given, and the pupil is left to carry out the amount, which should uniformly be done. If the computations are correctly made, the accounts will exactly balance. Quest. 67. What is an account current t What should it contain and show t EXAMPLES FOR PRACTICE. /amee, ^ aon. ^hM M /u.ne ^0 " S S$^(^ amd Canada 3 50 ^ sr fMo. /am.. ^y 9 ^M4e£, 0ai^ . .S3 Q.'^ay 4 " 4 QlSas. S&na Sf^ .09 ... ... /a.n.e /(f " ^ t^o. e/o. , .Oi ... ... /a.^ / " '^aad io ^a/cmee . 5 SO i 97 4^^0. ^el /^ // t t // /J 4ii0. G^(at. /(' // / ' ^r // 0y 40 ^tM4e£> €>ata .S7 " /J" -do. ^oioi .44 " 60 do. " ^6 do. "' " '©««>« to 4.50 ^.00 ... ... 6a 66 3S 4i 59. In the last example, the credits occurring before and exceeding the debits are placed first in the acct. Both exam- ples aie diiferently arranged under the Second Form effects. 49 (3^o^ and No. Date Maker's Name. Indorser's Name. 4SlsO. / &KaM fO <^a«tue/rm,^ s 4 s /J' 5 // so se.&<.y«^ QM>^ed anc/ ^u No. Date. Payee's Name. Indorser's Name. fSl^O. ■f 4S fonn ^zace Q/i^i 4^i0. g4^ov. is '^euA, to ^oMi, ^uiee . . ©^. / 0S9 S5 ■/Mf. June 90 ^Scun io f-^'^' ^^^'^^ • . ©^. S fO SO /'^^ 45 a&. " c&). (&?. . Q4i. s SO 00 ^efa. / Balance (not due) • • 40 81 400 59 63. In connection with the general statement concerning Bills Receivable and Bills Payable, presented on the last folio, it will be found convenient to keep a Dr. and Cr. account with each. This is done in the same manner that an account is kept with an individual, or with Cash. 64. When we give any thing for a Bill, or on its account, we deJdt it. When we receive any thing for a Bill, or on its account, we credit it. The first entry to every Bill Receivable is on the Dr. side of the account. The first entry to every Bin Payable is on the Cr. side of the account. QlTBST. 63. How may a Dr. and Cr. accoant be kept with Bills Becelvable and Bills Payable?— 64. When do we dAU, a Bill, and when amdititl Where is the^jt entry toBUlc Beceirable, and where to Bills Payable! .^^UM .^^ece^a^^ h §9 ^4 J-/ 40 / c . " ^- &^. Qf. c£> so 00 II 45 4 GiTo. 4, " ^laee '-^ocfmam , , 40 i4 400 59 e% ^■u ^a&mce 6zouadi c&nem , , 40 i4 65. The account exhibited on this folio is based upon transactions recorded upon the preceding folio. The entry made in each, under date Sept. 12, 1880, relates to a note given to John Bruce in the settlement of our personal account. 66. A person keeping a Dr. and Cr. account with Bills Receivable and Bills Payable, can, by periodically balancing these accounts, ascertain what amount remains unpaid on the obligations he holds against others, and whether this sum is increasing or lessening from time to time; also, his own indebtedness on account of notes and other bills payable, and whether it is increasing or diminishing in amount. Quest. 65. Upon what tranRactiona is the account here presented ba&ed? — 6d ^hat can a person keeping such an account at any time ascertain? 6* es GENERAL BOOK-KEEPING. GENERAL SETTLEMENT. 67. A General Settlement shows how a person stands with the world, or with all persons with whom he transacts business, taken collectively. . It is made by taking an inven- tory of one's property, to the fair value of which he must add the sum of the' halancH due Mm "from others in the settlement of his personal accounts, and the balance due him on hiUs receivable. From the total amount of these he must deduct the sum. of the balances due others in the settlement of his personal accounts, together with the balance that may become due from him on bills payable. The difference of these amounts will evidently represent his exact standing with all persons with whom he has business relations. 68. Such general settlements should be made at the end of each year, immediately after one's annual settlements take place. By comparing the result of each general settlement with those of preceding ones, persons can readily see how much they have gained or lost during the past year, or in any given number of years. But without such a general settle- ment it is impossible for persons engaged in an extensive debit and credit business to possess any definite knowledge of their exact standing with the world. 69. No one who has any adequate regard for his own pecuniary interests, and for his reputation as a business man, should fail to make such a settlement at the close of every year's business. In the light of such facts as would thus be thrown upon one's business, ultimate success is almost certain; while, if left to grope his way as it were in the dark, he not only jeopards success, but seems even to court a failure. Qdest. 67. What does a General Settlement show ? How is a General Settlement made ' — 68. When should such a settlement be made ? How can persons ascertain what they hare gained or lost during the past year, or in any number of years? Can persons possess any deiinite knowledge of their standing with the world without such general settlements ? — 69. What is said of such settlements in connection with one's success OT failure in business? 54 MEMORANDUM BOOK. 70. When a person's indebtedness exceeds what he pos- sesses and what is due , him, taken together, he is insolvent, and is sometimes said to be worse than nothing. MEMORANDUM BOOK. 71. This book, whose name indicates its general character, is second in importance to the Ledger only. In it should be entered every thing of importance relating to a person's business that does not properly belong to the Ledger. It will often contain agreements, the carrying out of which will require frequent entries in the Ledger, as is illustrated in the case of John Bruce, whose account has already been given at pp. 32d and 33d. A memorandum of my agreement with him is given in the following Memorandum Book, under date Jan. 12th, 1880. 72. The Memorandum Book should commence with a general inventory of one's property. It should contain mem- orandums of agreements and of contracts of various kinds. It should not only contain a general statement of one's busi- ness affairs, but in it every important particular relating to his business which he ought himself to remember, or which should be known to his legal representatives, should be care- ftiily recorded. 73. All business engagements of importance which you make, to be fulfilled hereafter, should be carefully recorded in this book at the time they are entered into ; and when they are met, a brief entry should be made in the space left at the right, stating the facts. Where the engagement is simple, as in the case of my contract with Dr. J. Goodman, made March 16th, and promptly fulfilled, it is not necessary Quest. 70. When is a person said to be worse Hum nothing f — 71. What is said of the importance of the Memorandum Book ? What should be entered in it? — 72. With what should this book commence, and what should it contain f — 73. When should engagements be recorded 1 When met, what entry should be made ? When may the entries relating tn an agreement be made in the Cash Book on'y,aud when should they be made in one's personal account T 6& GENERAL BOOK-KEEPING. to open a personal account with him in the Ledger. It is sufBcient to debit Cash with the amount received of hijn. But in case the contract is more complex, and requires several entries to be made at different times, as is exempli- fied in my agreement with Jacob Merchant, made Nov. 10th, it becomes necessary to open a personal account with him in the Ledger, where all transactions relating to the contract should be faithfiilly entered. 74. Agreements should generally be made .in writing, and especially when much time is to elapse before their ful- fillment, or when they are in any degree complex. "When this is not practicable it is desirable to make agreements in the presence of witnesses, as in case of the engagement to furnish wood, entered into Dee. 1st In such cases the memorandum should be made as soon after the agreement as practicable, while all the particulars are fresh in the memory. 75. The Memorandum Book should be frequently re- viewed to see what contracts, if any, remain to be fulfilled, when the proper entries should be made opposite such as have been perfoimed. In cases like that entered under date Dec. 4th, the reserved space may be filled at the time the entry is made. It will generally be advisable, and especially in case your circumstances are much changed, to make out a general inventory of your property at the commencement of each year. 76. In case of a limited business, the Memorandum Book, like the Cash Book and Bill Book, may be kept in the Ledger ; but it will generally be preferable to keep it in a separate hook, after the manner of the one hereto annexed. Quest. 74. Wheu ehonld agreements be made In writing? When not in wi-iting, how may tliey be mndef — 75. Why should the Memorandum Book be fee- qnently reviewed ? How often should a general inventory be made 7 — 76. How should the Memorandum Book be kept? 5S MEMOEANDTJM BOOK. GENERAL INVENTORY OP MY PROPERTY. January \st, 1880. 77. Value of Farm, including Buildings and Fixtures . Value of Timber Lot . . do. Teams and Agricul- tural Implements . . Stock of Cattle . . . do. Sheep . . . Cash on hand .... Note against Peter York do. do. Ira Butts . Wm. "Williams owes me on Acct. Oren Olds do. do, Total Value of Property 4400, 850, 475, 875, 500, 80, 84 15. 84. 15. $7379, / Owe as Follows . On Timber Lot . . J. Olds on Note . . H. Brown on Acct. . O. Hyde do. Net Capital this Day , 4ih.- 150.00 14.75 12.50 2.25 179. $7200, Engaged to fttrnish J. Bronson with 10 lbs. of Butter a week for fapaily use till May 1st, for 15 cents a pound, to be paid for in cash as delivered. Gth. - Commenced trading with H. Van Allen, who is to take my Wheat at cash price when delivered; likewise the crop now on the ground. For particulars see writ- ten agreement of this date. 67 The increase of my property since Jan. 1st, 1879, has been $450.81. My business is in a more prosperous state than ever be- fore, for which I have great reason to be thankful. May 1st, engage- ment fulfilled and new one entered into this day. Contract fulfilled and account settled, Dec. 29th, 1880. GENERAL BOOK-KEEPING. January 12th, 1880. John Bruce commenced work on farm this day, for 8 months, on conditions fully- set forth in our written contract. For the first three months I am to give him $' per month, and for the remaining 5 months $11 per month. I am to give him what store pay he wants, from time to time, never exceeding his earnings, and to give him my note on settlement for any balance that may remain due, payable by the mid die of November next. Mar.ietk.- Engaged to furnish Dr. J. Goodman with 95 pounds of Maple Sugar, to be paid for on delivery at 12 cents per pound, April 15th '■ — '^ r- Agreed with Janies Underhill to plant sixteen-acre lot (No. 7) to corn, oh con- ditions fuUy set forth in contract this day made. -May 1st. -Contracted to supply J. Bronson with! Butter forffamily use till .Oct. 1st, at. 12 cents per pound. I have also agreed to let him have all the Cheese from- my dairy, as the same shall become merchantable^to be paid' for on delivery, at $6 per 100 lbs. 1 ith Engaged to put sixteen tons of hay, well cured and in good condition, into Stephen "Wakeland's barn by the 15th of July, to be paid for 1st Sept. at $7.25 per ton. Settled Sept. 12th, and gave my note to balance for $29.25, at sixty days. Paid note Nov. 12th. Bruce wishes to work for me next season. (See Arts. 36& 65.) All delivered and paid for, April 20th. . All obligation's satisfactorily met Nov. 10th, 1880. ■ ' Contract ' fulfilled Nov. list, 1880. Engagement met and pay received Sept. 1st, 1880. MEMORANDUM BOOK. June 7th, 1880. Employed Harriet Benson to do house' work for 13 weeks, at $1.25 per week. ■ Sept. 15th. ■ Harriet Ann has this day entered upon her duties as First Assistant in th« Union School, at $15 per month, or $45 per quarter of twelve weeks. Henry and Frances have this day commenced attending the Union School for the winter term. -UTov. 10th.- Purchased groceries for the winter of Jacob Merchant, to whom I have c'on- tracted 800 bushels of corn at 40 cents per bushel, the balance due me to be paid in cash when the full amount is delivered. : Dec. 1st. — — ! — : — Engaged to furnish Ira Wilson with 20 cords of Hickory, at $1.50 a cord, to be delivered at his house by the 15th of January, and to be paid for by the 10th of April. Present, Hiram Wilson and Jacob Townsend. 4th Wages paid and she left, Oct. 9th. Succeeded well. Wages paid Jan 1, 1881. They left school March 1st, 1881. All engagements discharged. Nov. 20th, 1880. Obligations met April 12th, 1881. Mill-dam carried away by a frpshet, and mill much injured. Loss $140.00. GENERAL BOOK-KEEPING. EXAMPLES FOK PRACTICE. FIRST FORM OF ACCOUNTS. 78. Examples for Practice are introduced into this work to enable the pupil to reduce to practice the knowledge of Book-keeping which he has already acquired. Each exam- ple in the First Form of Accounts consists of several transac- tions with the same individual, which, taken together, consti- tute a separate account, that should be opened, conducted, and closed, as in the case of examples already given. 79. For the purpose of solving these examples, the pupil should procure the necessary quantity of paper, ruled accord- ing to the instructions given at the 25th page, (Art. 28 ;) or he may make the perpendicular rulings himself. If the com- putations are correctly made, and the transactions are rightly entered, the last entry in the account will agree with the answer given after the last transaction in each example. 80. After each example has been solved, and the account has been accurately made out and properly balanced, the pupil will do well to copy his work neatly into Account Book No. 1, which has been prepared to accompany this volume, or into some other suitable book provided for that purpose. EXAMPLE I. 81. This example consists of a series of transactions be- tween the Book-keeper (each pupil may suppose himself or herself the person) and Asa P. Leonard, a country merchant. Note, The Student will do well to carefully review the suggestions addressed to liim on tlie 7th page before proceeding farther. The yonng Teacher, also, may he aided hy the suggestions addressed to him on the 9th page. Quest. 78, Why are examples for practice introduced into this work ? Of what does each example consist, and how should it be treated ? — 79. What suggestion is given for the papil ? How may you know whether the computations are correctly made, and the transactions rightly entered ? — 80. What suggestion is made In relh. tion to the use of Account Books ? ^,- 81, Of what does the first example given in the first form of accounts consist ? What may each pupil suppose himself? CO EXAMPLES FOR PRACTICE. Transaction 1. Jan. 4, 1880. I have sold Asa P. Leon, ard one quarter of Beef, weighing 150 lbs. for five cents a pound. I have received in partial payment 2 lbs. of Black Tea at 70 cents a pound; 4 lbs. of Coffee at 14 cents a pound ; and 25 lbs. of Brown Sugar at 10 cents a pound. Tr. 2. Jan. 25. I have bought of Asa P. Leonard three gallons of Molasses at forty-four cents a gallon. Tr. 3. Feb. 10. Sold him 40 lbs. of Pork worth eight cents a pound. Received of him forty dollars in Cash. TV. 4. Feb. 15. I have sold him fourteen bushels of Com at forty-five cents a -bushel. Tr. 5. May 10. I have plowed his Garden, for which I am to receive one dollar and seventy-five cents. Tr. 6. May 15. I have sold him eighteen bushels of Potatoes at thirty-five cents a bushel. Tr. 7. June 12. Sold him 250 lbs. of "Wool at forty cents a pound. Received of him 18 yards of Calico at 15 cents a yard, and three papers of pins at five cents each. Tr. 8. July 12. Have done two days' Work with Team, for which lam to receive one dollar and seventy-five cents aday. Tr. 9. Nov. 1. I have pastured his Cow fourteen weeks, for which he is to pay me 20 cents a week. Tr. 10. Dec. 4. I have this day finished drawing him twenty-four cords of Beech and Maple, for which I am to receive one dollar and fifty cents a cord. I have bought of him one pair of Kip Brogans for $1.25 ; 18 lbs. of Rice at six cents a pound ; 9 lbs. Loaf Sugar at 14 cents a pound; and 9 yards of Merrimack Sheeting at 9 cents a yard. Tr. 11. Dec. 29. I have this day settled with him and received the balance due me in Cash. What will be my last credit entry ? Ans. $114.32. Note. The solution of this example is given on the 6th and 7th pages of the Key. To find the solntion of any other example, look, aa in this case, immediately unnwr the title of the account, in the Key, for the page or pages upon which the example is recorded in the Book -keeping, which are there given in the same type with this Nota « 61 GENERAL BOOK-KEEPING. EXAMPLE II. 82. This example consists of a series of transactions with 0. D. Knowlton, a saddle and harness makes. Transaction 1. Jan. 4, 1880. Sold O. D. Knowlton eight bushels of Potatoes at thirty-five cents a bushel, and four bushels of Com at forty-two cents a bushel. TV. 2. Feb. 10. Sold him ten bushels of Potatoes for thirty-five cents a bushel, and twelve bushels of Wheat at eighty-seven and a half cents a bushel. TV. 3. May 1. Sold him sixteen pounds of Butter at twelve and a half cents a pound. Bought of him one set of Double Harness, valued at thirty dollars. TV. 4. May 6. Sold him fourteen bushels of Com, for which he is to pay me forty-five cents a bushel. TV. 5. .Tune 10. Sold him four bushels of Potatoes at thirty-flve cents a bushel. Also, bought of him one Brass Plated Sinstle Harness, at thirty-five dollars. TV. 6. July 2. Bought of him one Saddle, Bridle, and Martingale, the whole for eighteen dollars and fifty cents. TV. 7. July 10. I have sold him ten tons of Hay at four dollars and twenty-five cents a ton. TV. 8. Sept. 25. I have pastured' four Cows for him ten weeks, for which I am to receive twenty cents a week for each Cow ; also, one Horse nine weeks, at twenty-five cents a week. "We this day settle, and I pay him the balance due him in Cash. How much do I pay him ? Ans. $2.57. EXAMPLE III. 83, This example consists of a series of transactions with Isaac Mitchell, -who keeps a boot and shoe store. Transaction 1. Jan. 1, 1880. I have bought of Isaac QuBflT. 82. Of what does the second example consist f — 83. Of what does thf third example consist? 62 EXAMPLES FOR PRACTICE. Mitchell one pair of Kip Boots for three dollars, and one pair of Buffalo Over Shoes at two dollars and fifty cents. Tr. 2. Jan. 10. I have sold him two and a half dozen Hens' Eggs at fourteen cents a dozen. Tr. 3. Feb. 10. Have sold him four pounds of Butter at 15 cents a pound; and two bushels of "Wheat at 75 cents a bushel. Have bought of him one pair of India Rubber Over Shoes for $1.25, and one pair of Buckskin Mittens for 75 cents. Tr. 4. March 4. Have sold him one quarter of Beef, weighing 175 lbs., for 5 cents a pound. Have bought of him one pair of Congress Gaiters for $3.00 ; two pairs of Misses' Gaitws at $1.25 each; and two pairs of Children's Gloves at 15 cents a pair^ Tr. 5. May 14. Have sold him 18 lbs. of Wool for 30 cents a pound, and 14 lbs. of Butter at 11 cents a pound. Bought of him two pair of R. R. Jenny Linds at $1.25 a pair; one pair of Enameled Gaiters at $2.50; and six Linen Handkerchiefs at 60 cents each. Tr. 6. June 5. Have bought of him two pairs of Boys' Suspenders, at 15 cents a pair, and three pairs of- Mixed Half Hose at twenty cents a pair. Tr. 7. June 10. Have bought of him one Leghorn Hat for $1.50; two pairs of Calf Buskins for $1.00 a pair; and three pairs of Black Cotton Hose at 25 cents a pair. I have this day settled my account with Mitchell and paid him the amount due. "What was it ? Ans. $8.91. ' EXAMPLE IV. 84. This example exhibits a Sheep and "Wool Account In this account the cost of the sheep, and every thing paid out on their account, should be entered on the Dr. side. On the Cr. side of the account should be entered every thing that QsEBi. 84. What does the fourth example exhibit t 63 GENERAL BOOK-KEEPING. is received on account of the sheep, including the value of wool on hand, surviving sheep, and lambs. Transaction 1. June 1, 1879. I have bought one hun- dred and sixty Sheep at one dollar and twenty-five cents a head, for which I have paid the cash. Tr. 2. Dee. 15. The Sheep have been in pasture since their purchase for six and one half months. Pasturing is es- timated at three dollars a month for one hundred Sheep, and at the same rate for any greater number. Tr. 3. March 15, 1880. The Sheep have been fed on hay for three months. Feed and care are estimated at $12.00 a month for one hundred Sheep, and are computed at the same rate for a greater number. TV. 4. June 1. The Sheep have been in pasture since March 15th, at the rates specified in the second transaction. "Washing and shearing have cost me at the rate of $6.00 for 100 Sheep.* I have cut from the flock six hundred pounds of Wool worth forty cents a pound. There are one hundred and fifty-two old Sheep living, worth one dollar and twenty- five cents a head, and sixty-four Lambs, worth seventy-five cents each. What must be entered on the Dr. side in closing the account, as the profit on one hundred and sixty Sheep for one year? Am. $153.60. EXAMPLE V. 85. The fifth and sixth examples consist of a series of transactions with Henry Webster, a' bookseller and stationer. The account, which was settled July 10th, was reopened the 10th of September. If the sixth example is entered on the same folio with the fifth, the name of Henry Webster * This account should, under this date, be debited with the Interest on the cost of ene hundred aod sixty sheep for one year, which is computed at seven per cent. Quest. 84. What should he entered on the Hr side of this account? What on the Cr side ? — 86. Of what do the fifth and sixth examples consist ? di EXAMPLES FOR PEACTICE. Tl need not be written the second time, but the account may be reopened, after the manner of the continuation of the account with John Martin, as given at the 42d and 43d pages. Transaction 1. Jan. 1, 1880. I have sold Henry W(!b- .. ster U^ lbs. of Butter for 14 cents a pound, and 25 lbs. of Cheese at 8 cents a pound. I have bought of him one Family Bible at $3.00; one Webstei^s Dictionary at $3.50; and one copy of Mayhew on Education for $1.00. Tr. 2. Jan. 5. Sold Henry Webster forty pounds of Butter at fourteen cents a pound. Fr. 3. Jan. 10. Bought of him one Thomson's Higher Arithmetic for 75 cents ; one Smith's Arithmetic for 50 cents: and two Tower's Intellectual Algebra, at 37^ cents each. Tr. 4. June 4. Sold him ten pounds of Linen Eags at four cents a pound. Bought of him four quires of Writing Paper at 20 cents a quire ; two Tower's Gradual Reader at 25 cents each ; and two copies of Webster's Spelling Book at ten cents each. 2V. 5. July 1. Sold him 10 pounds of Butter at 10 cents a pound, and 4 doz. Hens' Eggs at 8 cents a dozen. Bought of him one Wells' Grammar at 38 cents, and two copies of Thomson's Practical Arithmetic at 38 cents each. Tr. 6. July 10. Settled and paid the amount due him in cash. How much M'as it ? Ans. $0.65. EXAMPLE TI. 86. This example consists of a series of transactions with Henry Webster, the bookseller and stationer naipaed in the last preceding example. (See Art. 85.) TVansaction 1. Sept. 10, 1880. Sold Henry Webster 25 bushels of Potatoes at 30 cents a bushel, and ten pounds of Butter at 12^ cents a pound. Bought of him two quires Quest. 86. If the account with an individual is settled and balanced, and subsa, qnently reopened on the same folio, is it necessary to write his name the second time i 6* 65 GENERAL BOOK-KEEPING. of Writing Paper at 25 cents each ; one Ackerman's Natural History tor 50 cents ; and one Day Book and one Ledger, each containing five quires of paper, at 34 cents a quire. Tr. 2. Nov. 1. Bought of him one Thomson's Higher Arithmetic, one Davies' University Arithmetic, and one Per- kins' Higher Arithmetic, at seventy-five cents each. Tr. 3. Nov. 10. Bought of him one Smith's Astronomy for seventy -five cents, and two copies of Guernsey's History of the United States at sixty-two and a half cents each. Tr. 4. Dec. 12. Finished drawing twenty cords of Beech and Maple at two dollars and twenty-five cents a cord. Tr. 6. Dec. 15 Bought 4 quires of Writing Paper at 20 cents, and one Sons of Temperance Offering for $2.25. Tr. 6. Dec. 20. Bought one North American Second Class Reader for 50 cents; one Ivory Folder for 19 cents; and one Box of Wafers for six cents. Settled, and received the balance due me in Cash. How much was it ? Ans. $41.30. EXAMPLE VII. 87. The seventh example exhibits a Pork Account, and the eighth a Beef Account. The entries are to be made- .according to the principles stated under the fourth example, and more fully elucidated under the account with a Wheatfield, given at the 34th and 35th pages. (See Arts. 39 and 84.) Transaction 1. Sept. 10, 1880. I have bought forty-five Hogs weighing 9856 lbs. at three cents a pound. Tr. 2. Sept. 15. I have bought 17 Hogs weighing 4180 lbs. at 2^ cents a pound. I have bought for their feed 900 bushels of Corn at forty cents a bushel. Tr. 3. Oct. 25. Paid six cents a bushel for moving and grinding 280 bushels of Com, to be used for feed. Quest. 07. What do tho seventh and eii^hth examples exhibit ? In these and similar arcountG, how are wo to dotermine what transactions to enter on the Dr. and what on the Cr. side of tho account ? EXAMPLES FOB PRACTICE. Tr. 4. Dec. 10. The expense of slaughtering sixty-two Hogs may be estimated at seventy-five cents each. Tr. 5. Dec 11. I have laid by for family use 750 lbs. of Pork which is worth five cents a pound. Tr. 6. Dec. 12. The expense of marketing 62 Hogs is estimated at ^20 cents each. I have sold 18,650 lbs. of Pork for five cents a pound. What has been the profit on fattening Bixty-two Hogs ? Am^ $123.67. EXAMPLE VIII. 88. This example exhibits the particulars of a Beef Ac- count. (For instructions see Arts. 39 and 84.) Transaction 1. July 20, 1879. Bought twenty-one Yoke of Oxen at sixty-eight dollars a yoke. Tr. 2. Aug. 4. Bought 15 Cows at twelve dollars a head. Tr. 3. Aug. 10. Bought 22 Cows at $12.50 a head. Tr. 4. Aug. 20. Bought 23 Steers at $20.00 a head. Tr. 5. Nov. 1. The pasturing up to this time is estimated at eleven weeks for all of the cattle, (some have been kept longer and others not so long,) and at twelve cents a week per head. They have up to this time been fed one hundred loads of pumpkins worth 50 cents a load. Tr. 6. Feb. 1, 1880. Have fed one hundred tons of hay worth four dollars and fifty cents i ton ; also 1800 bushels of corn worth thirty-five cents, and have paid for grinding the same five cents a bushel. Have this day sold the whole, at the following prices : Twenty-one yoke of Oxen, each Ox weighing 980 lbs., at five cents a pound ; thirty-seven Cows at an average weight of 600 lbs. for four and one half cents a pound ; and twenty-three Steers weighing 700 lbs. each, at five cents a pound. What has been the profit on fattening Beef? Ans. $164.36. Note, For tlie advantapes attendant npon keeping this class of accounts see Arta 39 and 40. See also tbe Note on the 71et page. 67 GENEEAL BOOK-KEEPING. EXAMPLE tX. 89. This example consists of a series of transactions with F. M. Granger, a saddle and harness maker. Transaction 1. Jan. 4, 1880. Bought of him one com- mon one-half tug Harness for $16.00 ; three common Halters at 75 cents each ; and two common Bridles at 75 cents each. Tr. 2. Jan. 10. Sold him ten cords of Wood for $2.25 a cord, and 18 bushels of Potatoes at 30 cents a busheL Tr. 3. Jan. 25. Sold him 20 lbs. of table Butter for which he is to pay me fourteen cents a pound. Tr. 4 Feb. 10. Sold him eighteen bushels of Wheat at one dollar and thirty-eight cents a bushel. Tr. 5. Feb. 26. Have this day delivered to hun 25 lbs. t ticulars does the smmd farm ofacamvts differ from the firttt — 04. What account already given is here arranged according to the provisions of the Second Form of Accounts f What are the advantages, and what the disadvantagee, of this method? — 95- To whose wants are the Jiffecsnt Forms of Account adapted, and by whom are they used 7 72 ^^CTiz^ ^an G^//en 6 f^c Sy^ ^. SSuHU>&i^4.00 / 9 ctj. 00 cU. // // " S\i 'I '^oMi^meie S.30 5 75 ^ SO ^«*^ ^AecU .75 4 S5 45 00 ^^ ^ &o 40 ^a. ^towm e$^«* .0^ 3 SO ft " S0% '^c^. ^4eeiL^ ./tf '1 40 " Qle.2^1^ .34 3 3 05 40 II &tt»vin»n^ " 4 ^d,. ef^^d .S^nen. .56 S 34 S4 // // " /M " ,^inen Scl^^ .SO " S .^^ne^ 9^^^. .37V^ 30 Q^a^ /tf 75 // /<■ " 46'^.^atc^'^^d'f.S5 SO 00 /y // " 4 &aM. ©^«/ ^uadma 4 S5 " 30 '^di. (^4eetm^ .// " 44 /&,. ^a/ ^«^ .44 " S e^ciAi,^a/ 91^.3 4y^ " 40''^i>L.^to«m.SSmen.35 3 4 3 30 96 63 50 It is " S4 1' cS? '^m^dam. .34 1' 4 " ^uMC&Zd 3.00 7 4S 44 00 1/ // " 4% ^. EXAMPLE V. 106. The Tobacco Account introduced in the last exam- ple is here continued. That account was for the period of twelve years. This example brings the account down eleven years further, making twenty-three years in all. Like the former, it will require twelve transactions, of which the first two and the last are here given. Transaction 1. 1872. There should be entered on the Dr. side of the account the amount expended for Tobacco the first twelve years, as shown by the preceding examplei QlTEST. 105. What jg the expense iocurred by au hi'liTidnal for Tobacco od aocounl of SmokiDg and Chewing according to thl8 estimate in twelve jears! 80 EXAMPLE8 FOK PRACTICE. [The first entry is neither more nor less than the "amounl to balance" the preceding account brought forward.] Tr. 2. 1873. There should be entered, first the interest on the amount expended for Tobacco the twelve preceding years, and then the amount expended for the last year. Tr. 12. 1883. This transaction should be entered on the principle stated in the twelfth transaction of the last example. [The principle upon which the intervening transactions should be entered has been sufficiently elucidated.] "What will be the expense of Smoking and Chewing, at the rates stated in Example IV., for the period of twenty- three years ? Ans. $2000.65. EXAMPLE VI. 107. The Tobacco Account embraced in the two pre- ceding examples is here continued. In those two examples taken together, the account is exhibited for twenty-three years ; in this it is brought down eleven years further, making thirty-four years in aU. It will require the same number of transactions as the last example. These 'will commence with the year 1883, and end with the year 1894. What will be the expense of Smoking and Chewing, at the rates stated in Example IV., for the period of thirty-four years? ^ns. $4802.01. EXAMPLE VII. 108. This example consists of the Cash Account of an Individual who is employed at a salary of $500.00 a year. In the 11th and 19th transactions the articles purchased are not specified ; but there is reference to a Memorandum Book in which they are supposed to be entered. Transaction 1. Jan. 1, 1880. The individual debits Cash QnEST. 106. What will the expense amount to in twenty-three years, according to this estimate? — 107. Wliat la thirty-four years? — 108. Of what does the seventh example consists 81 GENEKAL BOOK-KEEPING. vsrith the amount of Cash on hand at the beginning of tlia year, which is twenty-five dollars and fifty cents. Tr. 2. Jan. 29. Paid 4 weeks' board at 2 dollars a week. Tr. 3. Feb. 27. Paid 4 weeks' board at 2 dollars a week. Tr, 4. Mar. 25. Paid 4 weeks' board at 2 dollars a week. Tr. 5. April 1. Received one quarter's salary. Tr. 6. April 10. Paid 30 dollars for a suit of clothes. Tr. 7. April 24. Paid four weeks' board at 2 dollars a week. Also paid the same day 4 dollars for one silk hat. Tr. 8. May 3. Paid a missionary subscription of $15.00. Tr. 9. May 10. Have this day subscribed and paid ten dollars for the support of the ministry the current year. Tr. 10. May 23. Paid 4 weeks' board at $2.00 a week, Tr. 11. June 1. Paid for sundries for personal use, as per memorandum, four dollars and fifty-six cents. Tr. 12. July 4. Paid anniversary expenses, amounting in all to four dollars and fifty-seven cents. Tr. 13. July 22. Paid 8 weeks' board at $2.00 a week. Tr. 14. Aug. 15. Received 1 and a half quarter's salary. Tr. 15. Aug. 25. Bought a dress and sundry small articles for sister, amounting in all to $12.50. Tr. 16. Oct. 1. Received one half quarter's salary. Tr. 17. Oct. 10. Paid $14.00 for a cow for my mothet Tr. 18. Oct. 22. Paid 13 weeks' board at $2.00 a week. Tr. 19. Nov. 10. Bought sundries as per memorandum, amounting to seven doUars and seventy-five cents. Tr. 20. Dec. 31. Paid 11 weeks' board at $2.00 a week. Received one quarter's salary. What amount of Cash on hand ? Ans. $319.12. EXAMPLE VIII. 109. This example exhibits a Wine Account for the period of twelve years. It embraces the amount paid for Wine, Cigars, etc., and occasionally a moderate expenditure Quest. 109. What does the eighth example exhibit? What does it embrace/ EXAMPLES FOE PRACTICE. foi a social repast, including supper, cards, and sundry kin* dred disbursements. The expense is estimated at $1.00 a day, whioh a reformed man (who has had twenty years' expe- rience, during which time he squandered an immense patri- mony) informs me is a very low estimate of the expenses attendant upon fashionable tippling. Interest is to be com- puted as in the Tobacco Account exhibited in Example IV., and the transactions are to be entered according to the prin- ciples there stated. 110. The Wine Account, we will suppose, commenced with the year 1868. What will it amount to in twelve years ending with the year 1879 ? Am. $6529.29. EXAMPLE IX. 111. The Wine Account introduced in the last example is here continued. That account was for the period of twelve years. This example brings the account down eleven years further, making twenty-three years in all. This, like Exam- ple v., will embrace twelve transactions. These commence with the year 1879, and include the year 1890. What wiU the Wine Account amount to in twenty-three years? ^w. $19,504.22. EXAMPLE X. 112. The Wine Account embraced in the two preceding examples is here continued. In those two examples taken together, the account is exhibited for twenty-three years ; in this it is carried forward eleven years further, making thirty- four years in all. It will require the same number of trans- actions as the last example. These will commence with the year 1890 and end with the year 1901. What will the Wine Account amount to in thirty-four years ? Ans. $46,814.55. QOEST. 109. WhHt is the expenss eHtimated at per day 1 Is this a liigh estimate I - -110. Wliat will tlie account amount to in twelve years? —111. What in twentj^ three years ! ■— 112. Wh>at will the Wine Account amount to af this rate in thirty- our years 1 OGKEBAL BOOK-KEEPING. EXAMPLE XI. 113. This example and the next consist of a series of transactions with Otho H. Hudson, a hardware merchant. Transaction 1. Jan. 3, 1880. Bought, of him 2 Nail Hammers at 50 cents each; one Cast Steel Nail Hammer at one dollar ; 2 Hand Saws at $2.00 each ; one large Backed Saw for $2.00 ; and one small Backed Saw for $1.25. Tr. 2. Feb. 1. Bought of him 2 Jack Planes and 2 Fore Planes at $1.25 each, and 2 Long Jointers at $1.50 each. Tr. 3. Feb. 10. Bought 1 pair of Match Planes, H in., for $2.00 ; 2 pairs of Match Planes, 1^ in., at $2.25 a pair ; and 2 Smoothing Planes at $1.00 each. Paid $8.00 on acct Tr. 4. March 20. Bought of him one seven-foot Cross- cut Saw at 63 cents a foot, and one seven-foot Mill Saw at 94 cents a foot. Settled and paid him the balance due in Cash. How much was it ? Aiis. $28.74 EXAMPLE XII. 114. This example is a continuation of the account with Otho H. Hudson, introduced in the last example. Transaction 1. April 1, 1880. Bought of him 2 Bed- cords at 25 cents each ; one Dinner-bell at one dollar ; one Clothes-brush at 50 cents ; one Nail-brush at 31 cents ; and 2 Tooth-brushes at 20 cents each. Tr. 2. May 10. Bought of him one Strainer Milk-pail for 60 cents ; 3 Milk-pans at 20 cents each ; and one Wiro Sieve for 44 cents. Settled and paid the amount due on the account. How much was it ? Ans. $4.35. EXAMPLE XIII. 115. This example consists of a Sheep and Wool Accouni I give it as furnished by a citizen who kept the Sheep. The transactions may be arranged under two dates. Qdebt. 113. What do tlie eleTenth and twelfth examples couBiBt oil .-115. Of ^hat does the thirteenth example consist ? 84 EXAMPLES FOB PRACTICE. TVansaction 1. June, 1879. I have thirty Sheep, chiefly Lambs, valued at one dollar and twenty-five cents each. Tr. 2. June, 1880. The Sheep have been kept a portion •of the year on a summer-fallow, where they were rather useful to the fallow than expensive, and the remainder of the year on the common. The pasturing and care may be con- sidered worth $4.80 for the year. They were not foddered at all ; but during the winter they were fed half a bushel of oats a day for 60 days, oats being worth 25 cents a bushel. The expense of washing and shearing was 4 cents a head. The juarketing of the "Wool was worth 50 cents. Had the sheep been sold a year ago, the money would have drawn 10 per cent, interest. Kept 7 lbs. of Wool, worth 40 cents a pound, for family use. Sold 103 lbs. for 40 cents a pound. The 30 old Sheep are worth $1.50 each. I have raised 27 Lambs from them, worth $1.25 each. What has been the profit on 30 Sheep for one year ? Ans. $67.50. EXAMPLE XIV. 116. This example is an acct. with 0. D. Morgan, a grocer. Transaction 1. Jan. 25, 1880. Bought of him 10^ lbs. of Brown Sugar at 10 cents a pound; 12 lbs. of Butter at 14 cents ; and 4 bushels of Potatoes at 40 cents a bushel. Tr. 2. Feb. 20. Bought of him 8 lbs. of Rice at 6 cents a pound, and 12 lbs. of Corn Starch at 12 J cents a pound. Tr. 3. May 2. Bought of him 8 lbs. of Codfish at 6 cents a pound. Settled and paid the amount due in Cash. How much money did he receive ? Ans. $6.79. Note. The 13th example, on page 84, is similar to the examples referred to in the Bote at the 71st page. Such examples may with equal propriety be kept by the I'irst Form of Accounts, or by the Second Form. Quest. 115. Is it real or fictitious ? What was the profit on thirty Sheep fer one fear 7 How much is this a head? 8 86 GENERAL BOOK-KEEPING. THIBD FORM OF ACCOUNTS. 117. In the Third Form of Accounts two principal books are used — the Day Book and the Ledger. This form of accounts is sometimes called the Merchants' Form. 118. The Day Book is a book in which all the debit and credit transactions of the day are entered at the time and in the order of their occurrence, whether with one or many persons. It is ruled like the Ledger in the Second Form of Accounts, with but one exception : in the Ledger there are seven spaces, the two at the left being occupied for the month and the day of the month ; while in the Day Book there are but six spaces, one at the left being omitted. 119. The date in the Day Book is kept in the middle of the page, and the left-hand space is used for entering the number of the Ledger folio into which the entry is posted. 120. In the Third Form of Accounts, when several arti- cles are sold to the same person at one time, (or bought of him, as the case may be,) it is best only to short extend the particular sums, or to enter them in the first set of money columns, and then fuM extend the amount of the whole, entering the same in the second set of money columns. By this means the number of entries necessary to be made in the Ledger will be considerably diminished, and the account will hence be exhibited in much less space than would be otherwise required. 121. Before any amount is full extended, in order to avoid mistakes, it will be well for the book-keeper always carefully to review the entries, with a pen or pencil in hand, affixing to those that have been so examined a sign (thus V ) to show Quest. 117. How many principal books ars used in the third form of accounts f What are they ? What is this form sometimes called ! — 118. What is the Day Book ? How Is it ruled ? — 119. Where is the date kept ( Tor what is the left-hand space used? — 120. When should Che items of an account be thort extf,ndedf What advantage is derived from full extending the ajmount only of the articles bought or sold at one time 7 — 121. What is said in retation to reviewLog the entries before the amount is full extended ? THIRD FORM OP ACCOUNTS. that the work has been reviewed. When thus tested, the amount of the purchase or sale may be fuU extended. In this form of accounts it is customary to use the counting-room at (fa)) in connection with the price per yard, pound, etc. 122. The Ledger is a book to which the entries recorded in the Day Book are transferred, and so arranged as to pre- sent the account with each person on a folio by itself. 123. The Ledger is ruled as follows: Each page is divided by double perpendicular lines into two equal parts, each of which is ruled like the Ledger in the First Form of Accounts, with this exception : there is an additional space at the left of the money columns in which is entered the page of the Day Book from which the entry is posted. 124. The amount only of the articles purchased at any one time is carried to the Ledger. The debit entry, "To Day Book, 21, $5.38," which is the first in the following Ledger in the account with H. M. Roberts, is elliptical, (see p. 100.) Supply the ellipses and the entry stands thus: " To the amount of the articles debited in the Day Book on the 21st page, $5.38." The same is true of all Ledger entries. 125. Instructions are sometimes given to note in connec- tion with debit and credit entries in the Ledger, the words " Sundries," " Groceries," " Goods," " Merchandise," " Cash," " Note," " Order," etc., as the case may be. This may prop- erly be done whenever such an entry will save the necessity for referring to the Day Book for an explanation ; for we should keep as few books as will answer our purpose, and with the least writing practicable make them tell the most possible. But as such entries give the Ledger a bad appear- ance, they should be employed only when useful. Quest. 121. What is said of the countinf;-room a£(@}used in the third form of accounts? — ]22. What is the Ledger? — 123, How is it ruled? What is the use of the additional space? — 124. In posting, what only is carried to the Ledger? What is said of elliptical entries ? How will it stand with the ellipses supplied? 'Is the same true of all Ledger entries ? — 125. What Instructions are sometimes given in relation to posting? When may this be done, and why? 87 GENER'AL BOOK-KEEPING. 126. Moreover, to avoid the common inconvenience in text-books of turning the book ai'ound in order to exhibit the Ledger accounts, which is both unnatural and awkward, and the scarcely less objectionable method of exhibiting the Dr. and Cr. entries on different pages, which is rarely if ever practiced in this form of accounts, it has been found necessary to diminish the third space in the Ledger, and to use the letters Qi. ^. instead of the whole word Day Book. We likewise employ ^ for Balance, of. for Invoice, of. ^. for Invoice Book, i^. ^ for Sales Book, and 0^. 3C ^. for Profit & Loss, and for a like reason. But in doing this, while we really sacrifice nothing, we gain much ; for we exhibit the exact form in which accounts are usually kept. Indeed, many of our best accountants omit this space entirely. It will be seen, then, that the middle course has been adopted in this treatise. 127. Posting Books is transferring the accounts of various persons from the Day Book, through which they are scattered, to the Ledger, and arranging each on a folio by itself, with the proper reference figures in the Day Book to show the folio of the Ledger into which each entry is posted, and with corresponding reference figures in the Ledger to show the page of the Day Book from which each entry is posted. 128. Posting is done as follows: Take the Day Book and turn to the first unposted entry, and by means of the Index find the account in the Ledger to which the entry belongs, if such an account has been opened. If no such account has been opened in the Ledger, write the proper title in the Index, opposite which place the folio of the Ledger that is to be devoted to the account, and then, having entered the title in the Ledger, proceed with the posting. Entries may be posted directly from the Cash Book. Quest, 126. What do the letters D. B. in the third space in the Ledger stAnd -forf What do other letters named stand for? Why haa this abridgment been :made? What is sacrificed, and what gained by it? — 127. What is meant by the term Posting Boojcs t — 128. Huw is Posting done ? THIED FORM OF AOCOtrNTS. 129. If at any time it is ascertained that a transaction has not been recorded in its proper place, and under its appropri^,te date, the entry should be immediately made, •with the proper explanation. In the First and Second Forms of Account, the first entry of an account will of course be made in the Ledger, as that is the only book used ; but in the "Third Form of Accounts the original entry should in all cases be made in the Day Book, from which it must be posted into the Ledger. 130. Should an entry at any time, by accident or care- lessness, be made on the wrong side of an account, it should not be erased ; but the same amount should be entered on the opposite side of the account, "To Error," or " By^rror," as the case may be. It is apparent that the only effect of this last entry will be to counteract the mistake; this done, the correct entry should be made. In case a transaction is entered to the wrong account, the correction is made in a similar manner ; but too great pains can not be taken to make the original entries correct. It should be the aim and pride of the book-keeper never to make a mistake in the entry of his accounts. 131. It has been already remarked, (Art. 29,) that when a person has several Ledgers, they should be designated by the letters of the alphabet, thus: Ledger A; Ledger B; etc. Day Books should be lettered in the same manner ; and the first entry that is posted from a new Day Book into the Led- ger should show in the Ledger the Day Book from which it Quest. 129. If at any time it is ascertained tliat a transaction has not been recorded in its proper place, and under its appropriate date, wtiat should be done? Where is the iirst entry of an account made tn the First and Second Forms of Account ? Where in the Third Form of Accounts? — 130. In case a transaction is entered on the wrong side of an account, should the entry be erased ? What should be done ? What will be the eiTect of this entry ? Should the correct entry thou be made ? In case a transaction is entered to the wrong account, how is the correction made? Can too great pains be taken to make the original entries correct ? What should be the aim and pride of the book-keeper ? — 131. When several Day Books and Ledgers are used by the same person, how are they designated ? When you commence to post from a new Day Book, what should the first entry show ! 8* 89 GENERAL BOOK-KEEPING. is posted. For example, if you commence Day Book A, and Ledger A, at the same time, the Day Book may be filled when the Ledger is not more than one-fourth full. In this case the first entry to each account that is posted from Day Book B into Ledger A should be entered thus : To or By (as the case may be) Day Book B, p. 1. 132. When one Ledger is filled and a new one is opened, any unsettled accounts may be carried to the new Ledger in the same manner that 'an account is carried from one folio to another, for which see Arts. 4-8 and 49. ILLUSTRATIVE EXAMPLE. THIRD FOEM OP ACCOUNTS. 133. For the purpose of illustrating the mode of making Day Book entries and posting the same into the Ledger, we introduce a sample of Transactions as taken from a Eetail Store, with the Day Book entries and Ledger postings which these Transactions require. The learner has only to suppose himself the merchant conducting this business, and to regard these Transactions as having actually occurred, and they will possess for him nearly aU the advantages of real business. He will thus have the benefit of combining the Theory of business with Practice in the counting-room, as fiiUy as is possible short of engaging in actual business. Tuesday, May 1st, 1880. Transaction 1. I have sold to H. M. Roberts 28 yds. of Sheeting at eight and a half cents a yard, and two pairs of Shoes at one dollar- and fifty cents a pair ; and I have received from him 22 bushels of Oats at 45 cents a bushel. Quest. 131. Oive an example 132. When one Ledger ii filled and a new one opened, what should be done with unnettled accounts? — 133. For what puiv pose are sample trantiactiona introduced ? What should the learner do, and with what advantage to himself? 90 ILLUSTRATIVE EXAMPLE. Tr. 2. I have received from Isaac Hinman 20 lbs. of Butter at 15 cents a pound, and two Hams, together weighing 44 lbs., at 12^ cents a pound ; and I have sold him 3 shanked Hoes at 60 cents each. Wednesday, May '2d, 1880. Tr. 3. Have sold to Bronson Fisher 20 Seamless Bags at 22 cents each ; one grain Scoop Shovel at one dollar ; and 14 lbs. of Rope at 15 cents a pound. Thursday, May 3d, 1880. Tr. 4. Have sold to James Ellis one Pocket Compass for 50 cents ; 2 pairs of Snuffers at 37^ cents each ; and a Pocket Knife worth one dollar. Tr. 5. N. O. Morehouse has bought of me 2 Brooms at 15 cents each ; 7 yards of Gingham at 22 cents a yard ; lOJ yards of Blue Drill at 16 cents a yard; and 2 Scythe Stones at 10 cents a piece. Friday, May ith, 1880. Tr. 6. A. F. Kingsley has bought of me 2 pairs of Spring Dividers at 63 cents a. pair; 2 Trunk Locks at 31 cents each ; and one Chest Lock worth 44 cents. Saturday, May 5th, 1880. Tr. 7. I have sold to Silas Boomer 2 Dead Locks at 62J cents each ; 2 Cottage Locks at $1.50 each ; and 3 Trunk Locks worth 35 cents apiece. Monday, May 7th, 1880. Tr. 8. Bronson Fisher has purchased of me 2 Sprinkling Pots at 38 cents each; one Buck Saw worth $1.00 ; and one Box cf 8 X 10 Glass worth $2.25. Tr. 9i James Sterling has bought of me two Handsaw Files at 10 cents each ; one set of Knives and Forks for $1.15 ; and 12 lbs. of Lead Pipe at 8 cents a pound. I have received of him one quarter of Beef weighing 210 lbs. at 5 cents a pound. GENERAL BOOK-KEEPING. TvLesday, May %ih, 1880. TV. 10. I have sold to H. M. Roberts 15 lbs. of Brown Sugar at 10 cents a pound, and 7| yards of Calico at 16 cents a yard. I have bought of him 14 bushels of Potatoes at 40 cents a bushel. Thursday, May \tan, e/ueae^y, Q^Mau /^. /SSa Si 9e. &€ Mo^eU<, Q^i. 34 1' S ^a^ (Moei @ ^.50 . 3 3^ 00 5 3i U 0Sy SS ^ue / ^taanma ^dttet\i tm. " S c^o. a)o. %eii: @ 75c. / " / '=^«^ ^e^. . . . ^t 35 ^y MfaiU on. iMne. /« ^^ &V: 0. e^ozedoaae ^z. 35 my 6 ^lUe^ ^4eai ® ^.75 r^. S <^o 40\i X. '^aa i^iee^® SS c. 35 " 44 " '-SeMnan e^. ® /j? c. S / 36 " / ^uaU G'^ieaduie . d^. 36 ^y S <^oU, ^eecdn^ooc^ @ 4.75 i^^&a SSoomei QSt. 36 " / ^iKda '^om/uuii . . 50 S5 40 75 50 50 /y 54 50 4 65 V» '^ ©^^^, ^du.zac&iy, Q^u /yd, /S80. 35 35 " 3ii '^a^. e^Ad^ej @ 56c. 34 jU Iv / ^ua/ttet 'Wea/, ^i A. % 5 c. '/ / e^^ ^zoom . . . •" S Common e^o, @ SO c, , &o / &rei ^Ai-mea and ^otda " 45 X. ^oMe @ /^ e. . S5 S5 35 efo S 0ix!4et &^!kn>e^ @ 37\i e. " S '^e ^a/amce . • f ip 34 ip ^zcmdon S't SSy 40 X. "Woo/m 40y, c. 46 9ti 35 " '-^aan. io ^aMnee . 6 SO 30 00 S6 30 97 ^-^ e-^few, ^t^y, June S^, /8SO. 35 36 36 35 36 36 36 QSz <^a did fitc^ io 9c. G^&n " S cio. (^na^ % 50 e. - &ihiMa£iaaea @ 56c. &Konc^^, Jiime 4Sm. i^o 44 ^A. &i.va ^of-fse ® 45 e. I' 40 Sa. ^tce ® 7 e. . . ^». io H&ai * a&o(»net QSt. Q/o 4 tvA. '^cngei @ 45 c. , " 6 X. ^otn <^^u>/t ® 4Sc. " ^ii X, ^cmd&a @ 44 c. 00 4S 43 fOO '66 ^52 45 '54 INDEX TO LEDGER D. f AB 36 M ^■5 CDE 35 NO P 34 PQ GH 34 ^^ IJ S 35 K 3.6 TUV L WXYZ ro '^m^. ^. G£. M5. lac ' ( 1 1 11 m ii^o. /Mo. "S^^ / ^^ ^/ / ^tf e^law / ^y QS. s/ ^ 50 // fO // J-J" ^ // c^ .4 II $5 3/ 50 // J/ // J--^ 4 i";? / /ime A //■ i-^ J'/ 40 ^9 00 ^ SO 00 m^ . J ^.. '?niion s 4iet r.. tiio. /i^o. &^iau s ^^. i"/ 7 50 /ime 4 ^yOS. S5 27 00 // 7 1/ i'i' 4 (?/ / /une 4 // i-^ /5 00 ^ ~S7 00 * D. B, or D. only, aa here employod, stands Jbr Day Book. 100 ^Pt'. ^amea &/uet S3 ¥iio. ^^§0. &^y 3 ^oQi. i'/ S S5 e^(au ^0 ^fQl. S3 . 4 50 ': Jl fff // S3 S 75 June ■6 // S5. 7 00 // S4 /I S4 5 S5 / /"^ 30 Balance 1 25 50 J^ 30 / 50 a&adt?ice 95 \. Q/^, a G£ote^c ouae 4^^0. /Sio. @i^£^ .-3 ^oSS. i"/ 3 76 &^kiy /i- ^yOS. S3 40 50 11 JS II S3 4 4'f 1 / 96 // S4 40 SO II . . S6 II 94 S 43 /"^ 6 // S5 46 SO ,A^ 6 1/ 25 96 36 30 90 / 36 .90 ^^. ^a/mea (Sf^zuna ^ ^ ^ 4i^0. 4i^0. Qi^ay 7 ^ Qi. S3 9 34 e^ay 7 ^yQl. 99 40 50 II 47 II 94 3 46 II 'f7 II 94 90 Jme S ' // 96 5 43 Jane 30 Balance 3 02 y/ 44 30 II 96 3 44 3 59 Is 09 44 AS ^ ^a^mce 9* 101 sff ^z. G^. ^ <^t:yJej, ^.. f^io. /<#^^. e^^ 4 ^ ^. i-i" i" J-i" ©^4< /-^ ^ 3i. Jj" ^ J(? J/ f4 // i'J' / 5/ ^«« z,^ // i-^ /^ /J" June // // i'(^ /i" tfd? / // /.^ // ^(^ / z,^ i^ (2^^=. ,^. wofne^ 'r 5 ^4 ^ ^. ss 5 30 II S3 / 65 II S6 3 66 II S6 S Sf 13.12 Mote. The learner should not pass from the examlDation of this lUuRtratiTe Exam- ple till he is entirely familiar with the mode of entering these transactions in the Day Book, posting them into the Ledger, and closing the several accounts. When he [b able readily to answer the following questions, and clearly to explain the processes required, he may rest assured that his enbsequent progress, if equally thorough, will be easy and satls&ctory. Quest. 130. What Is the date of the last entry posted to the acconnt of H. M. ttoberts 1 What are the iUwx of this entry ? How is the amount of " Cash to Bal- ance " a8certained f S^" Let the learner answer the same questions in relation to the accounts of Isaac Hinman, Bronson Pisher, and N. O. Morehouse. What is the date of the last entry posted to the account of A. F. Kingsley ? What are the iiem.% of this entry ? What is the date of the last entry posted to the account of James lilllis ? This account seems to be balanced, and the balance brought down, June 30th What is the Balance, and to whom is it due \ JQ^ State the same particulars in relation to the account with JameE Sterling. What is the condition of the account of Silas Boomer? 102 EXAMPLES l-OR PEA.CTICE. PROOF OF 'POSTINGS AlSTD BALANCES. Day Booh Drs, and Ors., June SOth, 1880. Dr. Sums. Cr. SnniB. ^1. aum on frt^e 3^ 20 6S '^. aiun on Aaae 34 4^ 40 " // SS 46 6i // 1/ S2 46 40 " " S3 ¥3 43 // // 33 4i 50 Ji // S^ /S 49 //■ // 34 44 40 " " S5 r^ S4 // // 35 ii 70 " " S6 S9 6S 1/ It 36 45 43 ^^„.,^^ Balance • • • 14 89 .>:rr_ 475 ^S 475 is Br. Ledger Balances, June SOiA, 1880 Or. /ad. ^'iet^ma, fi. 35 3 03 /iiinea S^ia, ^. 35 4 25 ^i£za ^oomet, fi. 36 43 42 Balance • • 14 89 46 44 46 44 137. Above are entered the Dr. and Cr. sums on each page of the preceding Day Book, from which it appears the Drs. exceed the Crs. ' $14.89, as shown by the Balance. Now, as every Dn sum in the Day Book has been posted to the Dr. side of the Ledger, and as every Cr. sum in the Day Book has been posted to the Cr. side of the Ledger, and as, in obtaining the Ledger Balances, equal sums have in every instance been omitted from each side of an account, the difference in the sums of the Dr. and Cr. Ledger Balances should exactly equal the Day Book Balance. As this is so, we conclude the Piistings and Balances of the Ledger are correct. QuEBT. 137. How can you know that yonrjMRtt'T^s and Ledger boZaTices are correct^' 103 OENBKAL BOOK-KEEPING. KETROSPECT AND PROSPECT. We have thus far considered the three most common forma of keeping accounts by Single Entry Book-keeping. The First Form presented extends from the 24th page to the 59th, in the discussion of which all the leading fea- tures of the science are explained and elucidated. Then follow Examples for Practice, extending from the 60th to the 71st page, in the course of which the principles taught are applied to the ordinary business transactions of life. The Second Form of keeping accounts is briefly presented on the 72d and four following pages, (the principles of .the science previously taught being alike applicable to this form,) and Examples for Practice similar to the preceding are then introduced, extending from the 77th to the 85th page. These two forms of keeping accounts are adapted to the wants of persons generally, transacting a limited business of almost any kind ; but the former is more especially adapted to agricul- tural, and the latter to manufacturing pursuits, as has already been fully explained. In each of these two forms of accounts, the Ledger is the only account book required for use. A Third Form of recording business transactions, which is sometimes called the Merchant's Form, is introduced on the 86th page. The principles taught are practically applied in an Illustrative Example commencing on the 90th page, and concluding with a new and reliable methed of testing the ac- curacy of Postings and Balances, as is fiilly exemplified on the last preceding page. This form requires the use of a Day Book and Ledger, and is adapted to a retail trade. In Single Entry it only remains to present appropriate Examples for Practice in the Third Form. These completed. Commercial Calculations, the Philosophy and Morals of Business, and the Science of Double Entry, are respectively considered. QozsT. 137. State the substance of the retrospect and prospect given. 104 EXAMPLES FOB PRACTICE. EXAMPLES FOR PRACTICE. THIKD FORM OP ACCOUNTS. 138. In the First and Second Forms of Account each example consists of several transactions with the same indi- vidual. (See pp. 60th and 72d.) But in the Third Form of Accounts the transactions of the day are intermingled, being entered in the Day Book at the time and in the order of their occurrence. The following examples consist of transactions with twelve persons. These transactions should be entered in the Day Book prepared to accompany this volume, after the manner of those already given in the Illustrative Exam- ple, commencing at the 90th page. This done, they should be posted into the Ledger as those were, according to the instructions given at the 88th page. (Arts. 127 and 128.) These transactions, which commence with the month of May, 1880, continue three months. 139. Each pupil may regard himself as conducting the business here recorded. The accounts with persons are en- tered according to the instructions given in Art. 37; the account with Cash according to those given in Art. 45 ; and the accounts with Bills Receivable and Bills Payable as directed in Art. 64. Several of the following transactions will require an entry to two accounts, as is indicated at Tr. 3. Sometimes a Dr- or a Cr. entry, or both, will be required, and at the same time an entry in the Bill Book, as in Tr. 2. The learner will need carefully to exercise his judgment in determining what entries are required. QuEBi?. 13S. In the First and Second Forms of Account, of what does each exam* pie consist ? In the Third Form of Accounts, how are the transactions of the day recorded? Of what do the examples for practice in this form of accounts consist? What instructions are given for entering these transactions in the Day Book and Ledger? With what month do these transactions commence, and how long do they continue? — 139, Who conducts this business 7 What principle do we observe in keeping accounts with perscms f (Art. 37.) How is the Cash account Icept ! (Art. 45.) How are Bills Receivable and Bills Payable and accounts kept ? (Art. 64.) Doe» the same transaction ever require an entry to more than one account? 105 GENERAL BOOK-KEEPINCf. INVENTORY OF PEOPERTY IN TRADE. Tuesday, May \st, 1880. 140. Store and Ware House worth $4200.00 Merchandise in Store, 3500.00 Cash in Safe and Bank 900.00 James Sill's Note, (No. 1,) B. B. (Art. 147,) 225.00 Henry Hart owes me on acct., . . . 75.00 James Farley do. do. ... 60.00 Totalamountof my assets, $8960.00 / owe as JbBoiBS : Isaac Hill for Mdse. on acct., . . . $260.00 Note (No. 1) to H. Smith for Mdse., B. B., (Art. 147,) 700.00 Totalamountof my debts, $960.00 Net Capital in Trade, •. $8000.00 141. Accounts should be opened with Cash, with Bills Receivable and Bills Payable, and with every person who owes us, or whom we owe on account, at the time of com~ mencing busmess. (Art. 140.) These accounts should then be debited and credited from time to time, as our business transactions shall require; We should seek to make our Account Books tell the (ruth, the whole truth, and nothing but the truth relating to our business. Wednesday, May 2d, 1880. Transaction 1. I have sold Henry Allen 80 lbs. of Brown Sugar at 8 J cents a pound ; 4 bbls. of Eock Salt at $2.25 a barrel ; and 20 lbs. of Java Coffee at 20^ cents a pound. Q0EST. 140. What amount of assets bare I on commencing business, and in what do tliey consist ? What is my indebtedness, and in wbat does it consist ? — 141. What accounts sbould be opened at tbe time of commencing business ? What entries should then be made to these accounts? What should our Account BooliB tell ? 106 EXAMPLES FOE PRACTICE. Tr. 2. I have sold and delivered Merchandise to Job Otia to the amount of $75^,00, for which he has given me his Note payable at my store June 25th, 1880. (Bills Receivable No. 2, Dr., and B. B. Art. 147.) Tr. 3. James Sill has taken up his Note of Jan. 1st, payable at my store this day. (Bills Receivable No. 1, Cr., and Cash Dr.) ' Friday, May Uhy\^%li. Tr. 4. O. H. Andrews has bought of me 3_bbls. of Salt at $1.25 a barrel, and 31J yds. of Sheeting at 8^ cents a yard. I have received of him 4 Hams, together weighing 70 lbs., at 14 cents a pound. Tr. 5. A. B. Lincoln has brought me 44 bushels of Corn at 45 cents a bushel, and 10 bushels of Wheat at 95 cents a bushel. He has bought of me 8f yds. of Cottonade at 24 c; 4 lbs. of Black Tea at 60 c; and 4 bbls. of Salt at $1.25. Saturday, May 5th, 1880. Tr. 6. I have sold to S. O. Jenkins 10 yds. of Calico at ll-Jc; 12 yds. of De Laine at 22 c; and 6 yds. of Franklin Drill at 25 c. He has furnished me with 18 lbs. of Butter at 20^ c. per pound. Tr. 7. A. C. Morton has bought of me 56 lbs. of Crushed Sugar at 11 c. a pound, and 20 J- lbs. of Codfish at 6 c. a pound. Monday, May 7th, 1880. TV. 8. Nathan Powers has bought of me 2 Scythes at $1.10 each, and one Grain Cradle for $2.50. Tr. 9. I have sold John Ransom 2 pairs of Boots at $3.50 a pair; 8 Milk Pans at 40 c. each; and 40 yds. Three Ply Carpeting at 80 c. a yard. Tuesday, May 8th, 1880. TV. 10. I have accepted and paid in Merchandise John Cooper's Order on me in favor of John Smith for $40.00. (Art. 37.) 107 GENERAL BOOK-KEEPING. TV. 11. I have bought of Henry Smith on acct. a Bill of Merchandise as per Invoice No. 1, amounting to $200.00. Tr. 12. I have paid my Note No. 1 of Feb. 8, given to H. Smith for Merchandise,- mentioned in the Inventory of May 1st. The Note was for $700.00. (Bills Payable Dr. and Cash Cr.) Thursday, May 10«A, 1880. Tr. 13. I have paid Isaac Hill $225.00 on acct. of Mdse. bought of him, mentioned in the Inventory of May 1st, and I have bought of a Pedler sundry articles of Mdse. amount- ing to $25.00, which I pay for in Cash. Saturday,May 12th, 1880. TV. 14. I have sold Job Otis Merchandise as per Sales Book,* page 4, amounting to $265.00, for which I have re- ceived his Note payable in 30 days. (Bills Eec. No. 3.) Tr. 15. The receipts of Cash for small sales, as per Money Drawer, and not otherwise entered, have been $25.00. Tuesday, May loth, 1880. Tr. 16. I have sold to Ellen, daughter of James Farley, on her father's account, one De Laine Shawl for $5.00, and 30 yds. of Gingham at 25 c. a yard. TV. 17. I have bought Merchandise of Henry Smith, as per Invoice No. 2, amounting to $225.00, for which I have given him my Note, payable the 4th day of June next. (Bills Pay. No. 2.) TV. 18. O. H. Andrews has bought of me one .Suit of Clothes for $34.00; one China Tea. Set for $13.00; 32 yds. of Carpeting at 80 c; and 6^ yds. of Stair Carpet at 60 c. * The quantity and price of the articles sold should be entered at length in tb0 Bales Book. They ore here omitted because of the space they would occupy. 108 EXAMPLES FOK PRACTICE. Friday, May 18aya^^ 670 66 SS^/a. ^eceiua^ S69 50 e^.SS. ^ikcoA 7 /^ oKemly S^it 75 34 S^Sm/m e^««w 470 S5 ^a^nea ^a/i&it 79 ds Balance 712 63 3^my Q^/'en 30 4m ^^amiom 50 5S / £>Mi ^oohei 53

4^^ooJ se: em» 6 // /<# /^r^x^ Q/Vone 6 Ju^ S^ ^^^.meo e^^ @^ 120 ^tecema^^. Where Payable. When dne. Amount. Remarks. /iio. &^y ^ioie Q^av s 0S95 00 €^aii^ gSx^ S «6. /tme S5 75 00 ^kt^^tme S5 ^. // /i' S65 00 &^aui^€Mie /J" Jo- // 9 350 60 &a4i/^ume9 ^. M S S69 50 0'ati^/t^^ S Scin ^cmd Oiu^. 10 S54 60 tzuame Where Payable. When due. Amount. Kemarks. fMo. «^. ^a«4 &naw s $700 00 0h^ Q^Of ^ d>. /une -i SS5 00 ^a^^Mte A ■S^ ^tote riMt so 360 00 e^aii;^JiJy SO Sxc. ^and 1/ 4i 3^0 66 e^a^/u^ /i <3^y ^tote Qy^eea. ^5 SOS /5 No. 5. There is, therefore, no occasion for an entry to either under the head of " Remarks." When these Notes ma;ture the proper entries should be made under this head, showing whether they have been paid, or renewed, or otheiwise dis- posed of, and how. QnzBT. 147. When these notes mature what entries should be made' Does thu itatement agree with your Ledger account t 11 121 GENEBAL BOOK-KEEPING. AUXILIABY BOOKS. 148. It has already been stated that in the Third Form of Accounts two principal books are used. These are the Day Book and the Ledger. (Art. 117.) 149. Auxiliary Books are assisting or helping books. The most important of these are, the Cash Book, the Bill Book, and the Memorandum Book, which have already been described ; to which may be added the Letter Book, the In- voice Book, and the Sales Book. 150. The Cash Book is a book in which is kept an account of all moneys received, and of all moneys paid out. (For the manner of keeping the C. B., see Arts. 45 to 47.) 151. The Bill Book is a book in which is kept a memo- randum of Notes, Bills Receivable, Bills Payable, and Bills of Exchange. (For a fuller description of the Bill Book, and the manner of keeping it, see Arts. 60 and 147.) 152. The Memorandum Book is used for recording memorandums of various kinds, agreements, and all important particulars relating to a person's business that belong neither to the Day Book nor Ledger. (For a full description of the Memorandum Book, see Arts. 71 to 77.) 153. The Letter Book contains copies of all business letters, which ought always to be written in a neat and legible hand, and to be as clear and concise as possible. By using a Copying Machine much labor may be saved in keeping this book, and at the same time perfect accuracy secured. Copies of letters thus taken afford better evidence before a legal tribunal, than the most perfect copies made with the pen. The Letter Book should contain copies of all important busi- ness letters. Quest. 148. Whsit are the two principal books in the Third Form of Accounts? — 149. What are auxiliarv Bonks? What are the inosf importanf of them? — 150. WhatiJ the Cash Hook? — 151. What is the Bill Book? — 162. For what is the Memorandum Book usbd ? — 153. What does the Letter Book cnntain ? How ought letters to be written ? What of a copying machine 1 What of evidence in courta 7 122 LETTER-WRITING. 154. Good letter-writing is a fine accomplishment. The following specimen is therefore subjoined for the purpose of exhibiting the date, (1,) address, (2,) body of the letter, (3,) subscription, (4,) inscription, (5,) and superscription, (6.) LETTER OF INTRODUCTION. (1) ^eito*e, &^4Man, ^uA 95t/l, iHo. (3) Q/UHinv me io tnltoauce io S^uie m^ youna £i,(eni^, &tmatny &tua^, o^ mi,) cttu, tv4o vuitta S&o*lon an me Awi^iode e^ ii/ioewitma a aituaiton in, a a^oon=^rtiMt-^ntna SaiaoUt^wmeni. ^^lovn a R7io^efUt/ae o^ nta untJoim nmaaeaa ana ooecitence aa a n, ; yf tn ccuse you neea adactwneif ne^ ; ana Q^ ^neze^^}ie i tn tntuxiactma 4*}n io yout £rivoia^& aeai (4) S' temai/n', ^ieni^fien, (5) &Mea4M. <^a« & '/rAiein^, 33 &^umij^i e^., ^oaiem,, Quest. 154. What is said of good letter-writing ? For what purpose is a speci- mcn of letter-writing introduced ? Do the traits of character attributed to the person described in this letter of introduction entitle him to confidence ana esteem \ Whaf are some of these traits of character t GENERAL BOOK-KEEPING. 155. Below is exhibited the correct form of a letter when folded. The superscription (6) should occupy the lower half of the letter or envelope, both on account of its appearance, and the convenience of post-marking at the office. Postage is now generally, and very properly, pre-paid. 156. The Invoice Book is a book kept by many mer- chants, into which are copied all Invoices, or Bills of Goods purchased. But this requires much labor in copying, and is really of little use ; for in case of any difficulty with the seller, it is necessary to refer to his own list, and not to a copy of it. Invoices should be carefully compared with the goods actually received, so that in case of disagreement any error may be corrected, and then placed on file for future reference, as occasion shall require. When found correct, they should be entered in the Day Book, to the credit of the person of whom the goods have been received, as in case of credits per Bill. (Arts. 50 and 51.) 157. The Sales Book contains a description of Bills of Merchandise sold. It is kept like the Day Book. When large Bills of Merchandise are sold, the use of the Sales Book enables us greatly to abridge the entry that would otherwise be necessary in the Day Book. Q.UX6TJ 155. What part of the letter or envelope should the Buperscription occupy? — 156. What is the Invoice Book? Does this require much labor? Why iB it of little use ? ^■'hat ohonld be done with Invoices ? When found correct, where should they be entered ! — 167. What is the Sales Book ? How is it useful ? 121 COMMERCIAL PAPERS. BOOKS OF ACCOUNT. 158. Persons are sometimes allowed to introduce their books of account as evidence in their favor ; but such testi- mony is always liable to the strictest scrutiny. A person who would introduce his own books as testimony in his favor in court, must be able to pi'ove, by those who have dealt with him and settled their accounts, that he keeps his books cor- rectly and honestly. He must also be able to prove that the books produced are his account books, and that some of the articles charged have been delivered. NOTES, ORDERS, AND RECEIPTS. 159. A Note is a written or printed paper acknowledging a debt and promising payment. Notes are of different kinds. 160. A Promissory Note is a writing which contains a promise to pay money or deliver property to another, at or before a time specified, in consideration of value received by the promisor, or person who signs the note. (The terms maker of a note, and payee of a note, are defined in Art. 62, which see.) 161. A Negotiable Note is one that may be trans- ferred from one person to another, or that may be bought and sold, and thus have different owners at different times. Notes are usually made payable to the payee or his order; to the payee or hearer; or- simply to the bearer. All such notes are negotiable; but when a note that has been given to the payee or his order is transferred, the payee must indorse it by writing his own name upon the back of it. The coUec- QUEST. 158. Are Books of Account ever received as evidence? To what is such testimony liable? What must a person who would introduce his books as testimony be able to prove? — 159. What is a Note? — 160. What is a iVommory Note ? Who is the TBafrcr, and who the payee of a note ? — 161. What is a itegotiahle note ? To whom are notes usually made payable ? Are such notes tiegotidbUf WLen must a note hj indcnrsed t 11* 1!J6 GENERAL BOOK-KEEPING. tion of a note that is made payable to a specified person, without any mention of his order or the hearer, can be en- forced by the payee only, or by his legal representatiTCS. Such notes are therefore not negotiable. 162. A Due B(ll is a written promise to pay a certain sum of money, or a specified amount in goods or property, to a person named, to his order, or to the bearer. Due Bills are notes, though less fonnal than promissory notes usually are. "Vfhether negotiable or not, depends upon the circum- stances just enumerated. (Art. 161.) 163. A Bank Note is a promissory note, issued by a banking company, signed by the president and countersigned by the cashier, and payable to the bearer in gold or silver at the bank, on demand. Bank Notes are of course negotiable, being made payable to the hearer; and they are usually secured by a deposit of state stocks. (Art. 255.) 164. An Order is a written request to deliver money, goods, or other property, to some person specified, to his order, or to the bearer. The person on whom an order may be given is under no legal obligations to pay it, unless he first engages to do so. Orders are generally considered pay- able on presentation. They are sometimes accepted by the person on whom they are drawn. This may be done by his simply writing the word '■^Accepted" either across the back or face of the order, (but usually the latter, and in red inh^ and signing his name to it. Before this is done, an order may be regarded as evidence of debt against the drawer oi it; but afterward, it may be considered as evidence of debt against the acceptor, who, in accepting, agrees to pay. Quest. 161< What notes can be collected by the payee only, or by hie legal repre- sentatives? Are Bach notee negotiable ? ^1Q2, What is a Due Bill? Are due bills notes ? — Arp they negotiahU T — 163, What is a Bank Note ? Are bank notes nego- Uahle- f — 164. What is an Order ? Is the person on whom an order may be drawn tinder olUigations to pay it ? When are orders generally considered payable ? How may an order he acceptid by the person upon whom it is drawn? Against whom maj an Older be considered as evidence of debt ? 126 COMMERCIAL PAPERS. 165. A Receipt is a written statement, signed by the giver of it, acknowledging that he has received a specified amount of money, goods, or other property. A receipt of money may be in part or in full payment of a debt, and it operates as a discharge of the debt either in part or in full, as the case may be. A receipt of goods makes the receiver liable to account for the same, according to the nature of the transac- tion, or the tenor of the writing. Orders and receipts, like bills of goods, should be preserved and placed on file. CHECKS, DRAFTS, AND BILLS OF EXCHANGE. 166. Banks are institutions for the deposit and safe keeping of money. (Art. 230.) When merchants and others deposit money in a bank, and keep a bank account, each depositor is usually furnished by the bank with a small Bank Book, on the Cr. side of which are entered his deposits, and on the Dr. side the sums he withdraws. A depositor has credit at a bank only while the Cr. side of his account exceeds the Dr. side, unless by special agreement. 167. A Check is an order addressed to a bank for the payment of money to the bearer, to a person named in the check, or to his order. While a depositor has money to his credit at a bank, his checks are paid on presentation. But when one's bank account is drawn up, his checks are no longer paid, unless by a special arrangement. Checks should there- fore be presented for payment or acceptance as soon after they are given as practicable. 168. A Draft is an order addressed by one bank or mercantile house to another, for the payment of money to a person named, or to his order. When a draft is payable at Qotst. 165. WJiat is a Receipt f TTow does a receipt of money operate ? How a receipt of goods^ What should be done with orders and receipts? — 166. What are Banks? What is a Bank Book? When has a depositor crerfi* at a bank! —167. What is a Check ? When will a depositor's checks on a bank be paid t When should checks be presented for payment ? — 168. What ia a Draft? 127 GENERAL BOOK-KEEPING. sight, or thirty or sixty days after sight, three additional days, known as "days of grace," are by common usage allowed foi payment. Drafts are therefore sometimes drawn payable at sight, " without grace." (Form No. 9.) 169. A Bill op Exchange is a written request or order addressed by one bank or commercial house to another, requesting the payment of money to a third person named, or to his order. BiUs of Exchange are Domestic and Foreign. "When Bills of Exchange are drawn by parties residing in one state or country upon persons in the same state or country, they are called Bills of Domestic Exchange. When the parties to bills reside in different states or countries, and bills which are drawn in one country are made payable in another, they are called Bills of Foreign Exchange. 170. The person who makes or draws and signs a Bill of Exchange is called the maker or drawer; the person to whom it is addressed, the drawee; and the person to whom or to whose order it is payable is called the payee. When the drawee accepts a bill he becomes the acceptor, and thereby assumes the obligation for its payment according to its tenor. (Art. 164, and Form No. 10.) 171. A Set of Exchange usually embraces three bills -of the same date and tenor. When any one of the set is paid the others are void. The object of a Set of Exchange is simply to provide beforehand against inconvenience in case one of the set should be lost in transmission. The holder of a Set of Exchange may send two of the set forward for pay- ment, by different conveyances, and retain the third himself. Then in case one is miscarried the other may reach its desti- nation and be paid. If both are lost the third may be used. Quest. 168. What are ** days of ^race " 7 How are drafts sometimes made pay- able ? — 169. What is a Bill of Exchange ? What is said of eUntieiiic exchange, and vhat of foreign f — 170. Who is the makev or drawer of a bill ? Who is the drawee)' Who the payees Who the acceptart What obligation does the acceptor of a bill assume? — 171. What is a Set of Exchange ? When one of a set is paid, what of the others r What is the object of a set ? 128 COMMERCIAL FOEMS. No. 1. — A Promissory Note. $^5.50. ^amuee S&zenAom, ot fficiet, at my &tote mi, ^tooa^n, a^mty ^aytt/eU. No. 2. — A common Note of Hand. 0S4.OO. next. ^et vame tecemeei, of^ fixomMe to ^y sAa ot, ^eoviM, ^tventy.^out 01o&ki, t^ tent^ c^ay 4 ^^4, tt/tt4 m^ieat /torn t^ iemi^ o/ ^MiuMy No. 3. — A Note for Property. 060.00. "Wdu^id, e^y ^Oii. ^6^0. ^^iaiu elavti aJtei t^aie, Q/ ^tonuae to cie^vei to Jo^ ^oL—ADue Bin for Goods. (1^4.25. Q^etwa.^^tne SOt^, f^iO. QJvie 9^%^ 'WditcotrJ, ot CzcU, ^omieen tmd ^^ 0So^^^ (it '^Soec^ /torn my ^toze, vadte tecemed. , 129 GENERAL BOOK-KEEPING. No. 5. — An Order for Money and Goods. Famed &€imttage, Sia. 0^&aae fiay to \0^ia&im ^aUnate, ot &tc^, S^outteen ^jotutta tm '^aooe^ £u»n. yoitt &^ie, and €^^ Q0otiMtd wb mtmeVt ana cnatae tn^ dame to 0SO.OO. ^m^ No. 6. — A Receipt for Property. '; a good one-notde xf^aaon; in /uM o« nu ly ■fOt(d, l^^O. ^>^ No. 7. — A Receipt in fuO, of aE Demands. §S^7.'f7. Q4^ew ^/, ^/iJy 40td, f^^O. S^ecetved j&otn Jained Q^i^t 'Xf^mMm, (^wo S^imdied amd &eitemieem €Mid j^tr SSoi£ttd, No. 8. — A Cheek, payable to Bearer. 0/^0. ^S5. e/^ton, G^^d., ^e^. 'fOid, fi^O. ^ay io fW. Jf£. ^^J^ckuULU., ot ^ea/iei, ^Ae P^MouAed amd &even^-^^ and -^^ Q^o^oM, and cdatye ids trme to tne acannit cm ^375^^TS ' ^am^ €^aywe^. 130 COMMEECIAL FORMS. No. 9. — A Draft, puyahle to Order. e/^o.s37. Exchange Bank oi MVvon. 0^SS5^is &€if^eim, S^/, S^if. ^Si/l, fHO. e^t AMht, ivtthotU aiace, fK^V to tne &Ui^i oa^S/^T ^' G% (^^ Q/^ieaMei& ^amd, M-CLLLh£.UL Si J'HUJJL. G/^eut '^otd ^iy. No. 10. — A BiU of Exchange. EXPRESS &an Q^zaTiGMCo, ^^ae. Exohange for $S7S.OO. . Jt example in Equation of Payments. Stats Aud explaiu the secuud example. EQUATION OF PAYMENTS. No. 4, 24 days. The calculation gives an average of 12 days. As we reckon from May 1st, 12 days added will give the average date of the whole, which is May 13th. Hence, 196. To find the average date of- several bills of various amounts and bearing different dates, Reckon the time between the earliest date of a biU and the date of each of the several bills, and determine the average TIME of the whole, as in Art. 194. This, added to the date from which we reckon, will give the average date required. Had the bills in the second example been sold on a credit of 4 or 6 months, the average time of payment for the whole would be the same time after the average date of May 13th, as determined above. In case bills are sold at various times and on different credits, ascertain when they severally fall due, and then de- termine the average time of payment, as in Art. 194. Ux. 3. I have an Exchange Mdse. Acct. with Henry Brown. His Debits amount to $800, and their average date is June 26th. His Credits amount to $550, and their average date is June 1st. What is the Balance of the account, and when is it due ? Ans. $250 ; due August 21st. '^tffn /une S6 ^oQ'^ie. 00 Aug. 21 Balance . 550 250 00 00 ^00 00 OPERATION. 650 X 25 = 13,750 13,750 -=-250 = 55 Explanation. Multiply the smaller side of the account ($550) by the number of days that intervene between Quest. 19G. How dn yon find the average date of several bills of various amounti aad bearing diiiereat dates ? State aud explain the third example. 143 GENERAL BOOK-KEEPING. its date and the date of the larger side, (25.;) divide the product (13,750) by the balance of the account, ($250,) and the quotient will indicate the time when the Balance is due, (55 days,) reckoned from the date of the larger side of the account. "When the larger side has the later date, the time must be added, (as in this case ;) but when it has the earlier date, (as in the next example,) the time must be subtracted. In this example my gain from the use of $550 the 25 days before June 26th, is equal to my loss of the use of $250 (the balance) for 55 days. But 55 days is 1 month and 25 days, which, added to June 26th, makes August 21st. (Art. 178.) Ex. 4. I have an Exchange Mdse. Acct. with Henry Brown. His Debits amount to $800, and their average date is June 1st. His Credits amount to $550, and their average date is June 26th. What is the Balance of the account, and when is it due ? Ans. $250 ; due April 6th. 'totan /«^ / ^o ©^a6«. 00 00 April S6 6 Balance . 550 250 ^00 00 00 00 Explanation. This example differs from the third only in the dates. Here the larger side of the account has the earlier date. The computation is made in all respects as in the third example, and with the same result, (55 days.) But as the larger side of the account has the earlier date, the time must be subtracted, or counted back, as stated in the explanation of the last example. In this case my hss of the use of $550 the 25 days following June 1st, is equal to the gain that QuBST. 196. State and explain the fourth example. 141 EQDATION OF PATMENi'S. would arise from the use of $250 (the balance) for 55 daya. But 55 days is 1 month and 25 days, which, subtracted froj? i June 1st, Jeaves April 6th. (Art. 178.) This, then, is th^ date at which the balance was due, and from which interest should be reckoned. 197. These four examples embrace the different cases of averaging accmmts that are liable to arise, beginning with the simplest. When an account has only debits or credits, the average time is computed as in the second example. When an account has both debits and credits, the average date of each is first obtained, as in the second example. This brings the account to the form of the third or fourth example, when it should be treated as these have been. When an account has debits or credits only, and it is required to determine the average time of payment, the pro- cess is called Simple Equation ; but when an account has both debits and credits, and it is required to determine the time for the payment of the balance, the process is called Compound Equation. Equation of Payments, both Simple and Compound, may be computed by interest, which some prefer. To do this, we compute the interest on the several sums for the length of time we have used as a multiplier, and then ascertain how long it will take the sum total, or the required balance, as the case may be, ta earn the same interest. The results are the same, whichever method we employ. S!x. 5. Sold Joseph Sterling Merchandise at four different times, in amounts as stated in the following Account Current. The first three bills are at a credit of 4 months, and the fourth Quest. 197. What do the four examples given in Equation of Payments embrace F How do you obtain the average time -when an account has only debits or credits! How do you obtain the average time for the payment of a ialance, when an account has both debits and credifs f When is the equation of payments called simple, and when compound ? May equation of payments be computed by i7iferes(/ Hew? Are the results the same in both cases 7 What does the Account Current in the fiftli example show ? IS i4& GENERAL BOOK-EEEFING. is at a credit of 3 months. Two Cash payments were mad^ together amounting to $880.00, which are credited. / 11 II 4 II // 4 II ji s II Average . . Sro(ect rt^/ite and redress wrongs f — 206. Wliat Itind of employments may persons select ? When does any one forfeit his claim upou society for protecUoD io a pursuit, and why t 13* MB GENERAL BOOK-KEEPING. no claim for any- thing better than solitude, and the life of a hermit, tUl he can yield cheerful obedience to the require- ments of reciprocity. (Arts. 203 to 205.) 207. In application of these principles it is manifest that any person may properly raise corn, wheat, and potatoes, which are good for food. He may build houses and bams, make wagons and farm implements, and engage in kindred useful employments. He may erect flouring mills, and buy wheat at a fair price, and manufacture and sell flour at a reasonable advance. He may in like manner raise stock, and make butter and cheese. He may seU wool to be manu- factured into clothing, and hides to be made into leather, and this into boots and shoes. He may further buy the surplus products of the country, which are not required at home, and exchange them for the manufactures and products of others, which his neighbors need ; for all this can be done to the mutual advantage of all parties affected by these several transactions. These and other similar pursuits may be pros- ecuted in harmony with the requirement that we "do unto others as we would that others should do unto us." 208. But highway robbery, thefl, forgery, gambling in all its forms, and all kindred employments, are in clear viola- tion of the law of reciprocity. (Art. 204.) Their pursuit is subversive of right and justice, and of every principle that underlies and permeates well-regulated communities. Civil society, through its constituted authorities, should hence seek to free itself from all such modes of disturbing the public peace and jeoparding the public weal, and in all suitable ways discourage minor wrongs generally, and every form of em- ployment that tends to idleness and dissipation, while at the same time it should aim to encourage employments that are Qdest. 206. What claim, only, has be f — 207. Apply these priaciples to various proper employments. — 208. What employments are in violation of the law of reciprocity > What should society do with reference .to them ? What employments ihould society encourage t LABOB THE SOITBCE OF WEAITH. right aiid proper, and the pursuit of which will best promote the general good of the entire community. - LABOR THE SOURCE OF WEALTH. 209. The Creator, who made man with physical and intellectual faculties adapted to labor, has wisely ordered that labor is necessary in order to obtain the comforts and conven- iences of life, no less than as a means of preserving and improving physical and mental health. But the laborer has his reward; for he alone is entitled to the fruits of his industry. WhUe he regards the rights of his neighbor he may gain all he can, and use what he gains as he wUL This is the reason why human labor in different countries is commonly exerted in proportion as the rights of property are understood and enforced. 210. We hence see the wisdom of maintaining correct systems of popular education ; of every where teaching respect to the rights of property ; and rf inculcating obedience to the law of reciprocity. We hence also see the reason why moral and religious nations increase in wealth, while the vicious and irreligious struggle with poverty. 211. While labor is the source of wealth, it is also true that industry in some pursuits is more productive than in others, and that the aptitudes of men for different pursuits are very dissimilar. It therefore becomes each person to devote himself to an employment for which he has an apti- tude, and in the pursuit of which he may derive satisfactioa and attain success. 212. Simple labor, which is all that is requisite in order to produce the necessaries of life, requires only the exercise Qdest, 209. What is said of the necessity for labor? What reward has the laborer i What may he gala, and how use his gains ? How is iabor exerted in dif fetent countries! — 210. What of education! What nations increase in wealtli, And wliat remain poor f — 211. What is remarked of industry in difiereat pnr8nit% and of the aptitudes of men { What shonld each peison hence do ! 151 GENERAL BOOK-KEEPINe. of such skill as may be readily acquired by persons generally The simplest forms of labor require little more than the exercise of physical force, and are hence remunerated at the hwest wages. In proportion as sMU is associated with laboi will wages advance. This is because skill is more rare than physical force, and requires education and practice. 213. Beyond this, wages are affected by the degree r, and of the wages it will commaDd? How does 9^1Z affect wages ? Whyisthis? — 213. Are wages affected by the elmracler of the laborer 1 To what form of indus- try may eacn devote himself 7 What shonld every one do ? What say you of all nsefullabor? What shonld each person render to society? What said the apostls of him who will not work! — 214. What haa heen remarked ot Ittbtti; Kai vmgeil What effect has cajntaZ aron the productiveness of labor? 1Sj2 HOW TO RENDER LABOR MOST PRODUCTIVE. the occupancy of savages, give each of them an tix, and thej will in the same time make a comfortable log house. Give them the benefit of a saw mill, with suitable tools, and the skiU necessary for their profitable use, and they will erect a commodious dwelling house, befitting a civilized state of society. One man with an ax and a team can gather more wood for fuel in a single day, than twenty men could with their unassisted hands in a week. 216. He who has the full exercise of his physical powers, but is without skill in any trade or business, can engage only in the simplest forms of labor, and as a consequence will re- ceive low wages. But let a man unite with his labor sMU in some useful trade, as that of a carpenter, a mason, a wagon- maker or a blacksmith, and his services will command higher wages. Unite with labor and skill that trustworthiness which qualifies a man for the care of a manufactory, of a flouring mill, of a merchant's counting-room, or of any important busi- ness, and his services, being more valuable to his employer, will be remunerated at a higher rate. 217. Skill and trustworthiness render labor more pro- ductive and more desirable, in agriculture, in the mechanic arts, in merchandise, in commercial pursuits generally, and in every branch of productive industry. It therefore be- comes each individual, on selecting an employment, to attain in it that sMU, and to bring to it that fidelity, which shall render his services most desirable to his employer. These will enable him to command higher wages while working for others; and in case he desires to engage^ in business on his own account, they will enable him to procure any assistance he may need, on the most advantageous terms. Quest, 215. Show the value of an ox, and of asawmiTZ. with ^nolsandjAzV/in their uae. Show the value of an cus and a jeam. — 216. What of the wages of toior without sW! f Whit effect has sMK upon wages? What is the effect upon wages when the laborer unites with his skill trustworthiness f — 217. What forma [>f Kbor do skill and tniBtworthiness benefit? On selecting an employment what Blijald each person do? In what ways will sMS and ,/i<2e2% henelit their possessor? 153 GENERAL BOOK-KEEPING. BENEFITS FROM EXCHANGES. 218. Were every man to labor in that pursuit for ■whi'clj he has the greatest aptitude, each would be engaged in the production of one, or at most of but a few things, while the innocent gratification of his desires would require the posses- sion and use of a thousand 'products. The truth of this propo- ■ sition, and the benefits resulting from a division of labor, and from exchanges, may be easily illustrated. 219. The manufacturer of brooms might be able to supply a thousand families with thb product of his industry, whUe he requires but one broom for his own use, and yet himself be destitute of bread; while the farmer might raise bread stuffs enough to supply a hundred families, and stiU himself be destitute of a broom. The same might be true of the boot and shoe maker, of the chair maker, of the blacksmith, of the wagon maker, and of a score of persons engaged in different pursuits. Such considerations as these create the necessity for exchanges, by which men are enabled to dispose of their surplus products, which they can not themselves use, and re- ceive therefor the products of others, which they have not, but which they need. 220. Each person, by thus producing that in which he is well skilled, and for which he has the greatest aptitude, and by exchanging the same with others who have also a surplus of their own products, is enabled to derive enjoyment from the possession and use of a thousand productions, and is con- sequently happier than he would otherwise be. And as the same is tme of all persons, we can see the advantage that would result to each and to all — to individuals and to com- tnouities — from a division of labor and from exchanges. Quest. 218. What would "be the resnlt were every man to labor in that pursoit for which he has the greatest aptitude ? — 319. Illustrate the benefltR derivable from »xLhan^es. — 230. Show the influence of a division of labor and of exchanges npun the well-being and happiness of persons and communities. 164 HOW STEKCHANTS ARE USEFUL. 221. In fixing the exchangeable value of products, the desirableness of the employment, the amount of labor, and the degree of skill which are required in their production, must be taken into the account. HOW MERCHANTS ARE USEFUL. 222. It is desirable to effect these exchanges with aU practicable economy ; and the more rapidly they are made the better for all. It is from this consideration that merchants become necessary in facilitating exchanges. The merchant receives from each of his customers their surplus products, which they can not themselves use, and is thus enabled, by exchange in kind, to supply the wants of others. He is in this manner enabled to conduct the exchanges for a whole neighborhood more perfectly, and at less expense of time and labor, than though each producer were to conduct his own exchanges without the merchant's aid. 223. Intelligence and skill are essential to constitute a succesfiil merchant, for they enable him to seek from one class of his customers what he knows another class need, and to receive from these such products as wiU be required by others. It is thus that the merchant is enabled to make the exchanges which his customers require, more cheaply than they could do it among themselves without his agency, and still receive from each enough to compensate him for his skill and labor, and for the use of his capital. 224. The principle is the same with different nations, when each is enabled to produce an excess of one class of productions which are desired by the other. The wholesale merchant buys the surplus products of his own country, ■ • K • Quest. 221. What circumBtanceB must be taken into the account in £xing the exchangpable value of products ( — 222. What is remarlied of the cost of exchanges, and of the rapidity with which they are made? Show how merchants are lisefnl in effecting exchanges in Icind. — 223. Of what advantage are intelligence and skill to the merchant ? How are his customers ^enpiited by the merchant's intelligence and skill? — 224. Whan n^y nations be benefited by exchanges? 165 GENERAL BOOK-KEEPING. where they are not needed, and exchanges them with the merchant of another country, where they are desired, for their surplus products, which can not be raised in his own country, but which his customers nevertheless need. The people of each country are thus enabled to gratify more innocent de* sires, and are consequently happier than they were before. 225. In exchanges which are conducted en the principle here stated, each party is benefited. And the most favorable commerce to any country is that which enriches all countries afiected by it most rapidly. It is with nations as with indi- viduals engaged in commerce: each derives the greatest benefit to itself while most industriously and successfiilly laboring to supply the wants of the other. So intimately are the interests of each united with the welfare of others, that a bargain should never be made unless both parties to it can be gainers thereby. This principle applies to single persons, to separate communities, and to different nations. HOW MONEY FACILITATES EXCHANGES. 226. When we have any work to be done it is desirable to effect it in the best manner possible, and at the least ex- pense practicable. This is the reason why we use a wagon for transporting merchandise, and for carrying the products of the farm to market in summer and autumn, and a sleigh in winter , and why we employ a steamboat, a vesselj or a rail car, in preference to either sleigh or wagon, when practicable. 227. We have already seen that the services of the mer- chant enable us to effect exchanges more rapidly and more economically than could otherwise be done. (Arts. 222 to 225.) But it frequently happens that persons desire to sell more or less, in value, of their products, than they wish, at the Qd£6T. 224. How are sncli exchangea effected ? How do ther inflnence national happineaa? — 325. Who are benefited by snch exchanges? What ia the most favoi^ sble commerce to any country? When only ahonld a bargain be made? — 22& Uow i£ it desirable to do any kind of work ? Illustrate. US BANES AND BANKING. : time, to receive in return of the products of others. More- over, they often want to sell their own products without pur- chasing any thing in return. So, likewise, they frequently desire to purchase the products of others when they have none of their own to dispose of. To meet such necessities some object of universal desire has been found ijeedful. 228. As a means of adjusting such difference^, and of facilitating exchanges, the nations of the earth, generally, have agreed upon a metallic currency as this object of universal desire. It is because the precious metals have been found the most convenient instrument in effecting ex- changes that they have been so universally employed for this purpose. But for this circumstance, oranges, or precious stones, or some other instrument, might as well have been used as they. (Arts. 252 to 257.) 229. The money of civilized nations generally, consists ot silver and gold; or of these and a paper currency, which is adopted from economy and convenience, and which is re- deemable in the precious metals. Every person having any thing to sell is willing to dispose of it for silver and gold, (or their representative ;) for he knows that with these he can procure any thing he desires. OP BANKS AND BANKING. 230. Banks were originally designed as institutions fpi the deposit and safe keeping of money. They are of three kinds: (1.) Banks of Deposit; (2.) Banks of Discount; and, (3.) Banks of Circulation. Two of these functions, and not unfrequently all three of them, are performed by the same institution, and with advantage, as we shall presently see. Quest. 227. Why is some object of wniversal desire necessary in effecting ex- thnnges? — 228. What has hesn agreed npon as this dbjmt of universal desire? Wliy have the precious metals been employed in effecting.exchanges? — 229. Of what does the money of civilized nations generally consipt f Why are persons will- ing to sell their surplus products for silver and gold ! —230. What was thf original design of bants ? Of bow many kinds are ban&B, and what are they ? 14 167 GENERAL BOOK-KEEPING. 231. There is also another classification of banks having reference both to the authority from which they derive their origin and powers, and to the functions they perform. Tha second arrangement is likewise into three classes, namely; (1.) Commercial Banks ; (2.) State Banks ; and, (3.) Private Banks. , BANKS OF DEPOSIT. 232. Banks of Deposit are useful for the safe keeping of money. The precious metals are smtdl in bulk, and are therefore very liable to be stolen. The coins of the same denomination being made precisely alike, can not be identified in case they are stolen. Great care is hence necessary to •protect them. The security of each person against robbery requires that his money be kept in a safe. Otherwise house- breaking and highway robbery would become frequent. But one trusty person, with a good safe, may serve as banker for a neighborhood or village, and at less expense keep the money of twenty merchants with greater safety than each could keep his own. 233. This method of keeping the money of a neighbor- hood or village has several advantages. The banker opens an account with each merchant and person depositing money with him. He credits each one for the amount he deposits, and debits him for the sums he withdraws. Each individual having money on deposit is at liberty to draw it out in person, as he mf y need it for use ; or he may give a check on the banker requesting him to pay it to another person who may himself have an account at the bank. 234. Suppose A, who has money deposited in a bank, wishes to pay B five hundred dollars. His easiest way to do it is to give B a check on the bank for this sum. If B ^mssT. 231. Into how many classes is the second arrangement of banks, and what are they ? — 232. How are Banks of Deposit useful ? State at length how they are useful. — 233. How are accounte kept at banks? How may persons having money on deposit use it ? — 234. State how several persons who keep their accounta at the same bank may most conveniently pay and receive noney. 158 BANKS OF DEPOSIT. does not require the money for use at the time, oh presenting , his check at the hank the banker will charge A five hundred dollars, and credit B the same s'nount. If B wishes to pay C five hundred dollars he will do it in the same way. C might wish to pay D, and D might owe A the same amount, and both would make payment in like manner. At the close of the day each man's bank account would stand as it was in the morning ; and yet each of these four persons has received five hundred dollars, and each has paid out five hundred dollars. A few entries in the books of the bank thus save the handling and counting of four thousand dollars, the wear of coin, the liability to loss, and the temptation, from exposure, to theft and robbery. 235. The case will be essentially the same with each of tw:eDty merchants who keep their accounts at the same bank ; for it is evident that every merchant will, on the whole, buy as much as he sells, and sell as much as he buys. He will, therefore, not only have occasion to deposit as much money as he withdraws, but in any given time he wiU withdraw nearly the amount he deposits. 236. And what is true of four men or twenty merchants •for a day or a week, will be true of all men in the community for aU time. And what is true of one bank wiU be true of any number of banks that are required for the transaction of the business of a city ; for at the close of each day, banks holding checks upon each other that have been deposited i with them by their customers, exchange these checks, the bank that holds the least amount in checks or drafts upon the other paying the difference in money. 237. Banks of Deposit generally unite with them the functions of Banks of Exchange, to the mutual advantage of Qdest. 234. What la thus eaved by a few entries in the books of a bank ? -^ 235, Will the same be true of a greater number of persons, and why ? — 236. Show how the same is true of any number of persons, and of different banks in the eame Rity. — 237. What other functions do Banks of Deposit per&rm, and to wnosa Itenefit 7 16S GENERAL BOOK-KEEPING. their customers and themselves, as we shall presently see; (Arts. 238 to 242.) 238. It is manifest that cities and states, as well as indi* viduals and merchants, will, on the whole, buy as much as they sell, and sell as much as they buy. If Detroit, for ex- ample, buys one hundred thousand dollars' worth of merchan- dise of New York, Detroit must send one hundred thousand dollars' worth of products with which to pay for it ; or each city must pay for its purchases of the other in money. If Detroit pays New York money for goods, it is apparent that New York must pay Detroit money in return for products received. This will require that the goods and products pur- chased of one another by these two cities, and the money paid for them, be both transported from each city to the other at every exchange, which would involve great expense, delay, and hazard. (Art. 232.) 239. AH this inconvenience may be avoided by the agency of banks in these two cities. Let us suppose that A, in Detroit, sells ten thousand dollars' worth of flour to B, of New York. Instead of counting the specie, and being at the expense and risk of conveying it to Detroit, it is evident A may draw on B for the amount, to be paid to whomsoever A shall direct. And suppose again that C, in New York, sells ten thousand dollars' worth of merchandise to D, of De- troit. It is plain that C is entitled, in like manner, to draw on D for this amount. Now A, of Detroit, who has ten thousand dollars due him in New York, may make his drafl on B for this amount, and deposit it to his own credit in the Detroit Bank, through which he does his business. In like mamser. C, of New York, who has ten thousand dollars due him in Detroit, may make his draft on D for the same amount, . Quest. 238. What ia remarked of the purchMes and ealeB of cities and states? Give an illustration, and state the manner of payment. — 239, Through what agency may the payment of money from one city to another be most easily made ? State at length how payment may be made by the agency of banks, in caae of parchases and sales between persons residing in diiferent cities, as Detroit and Kew York. 160 BANKS OF DEPOSIT. and deposit it to his credit in the New York Bank, througli which he transacts his business. In this way A, of Detroit, and C, of New York, obtain each a credit of ten thousand dollars in his own bank. Each credit is based on a drafi upon a person residing in the other city, the payment of which the drawer guarantees. The two banks exchange these drafts by mail, each debiting the other for the draft sent, and each crediting the other for the draft received. Now, each bank charges ten thousand dollars to its own de- positor to cover the draft it holds, each bank retaining the draft thus charged as its voucher on settlement with its depositor. In this manner the indebtedness of persons in each of these two cities, to persons in the other city, is exchanged; and the frequent transmission of large amounts of money is thus saved. Now, all this costs but a few cents postage, and a few entries in the books of each bank ; and there is thus saved the time, the cost, and the risk of transporting twenty thousand dollars between these two cities. It is evident that these banks, beside their own compensation for services thus rendered, will by this means be enabled to save a considerable amount to their customers. 240. What we have supposed true of four persons re- siding in these two cities must be essentially true of any number of persons residing in commercial centers in different states, or in foreign countries. There may be this difference. One state or city may buy of another more or less than it sells to it in return. In such cases the party making the largest purchases must sell enough to other states and cities to make up the difference. Whenever the trade between two cities is unequal, that whose sales to the other are least, must make up the difference in drafts upon other cities or states to which it makes sales, or by payment in money. . Quest. 239. What is the actual cost of this mode of payment, and what is saved by it? —240. Is the same principle of general application? M'hat difference may Uiere be, and bow must it be made up ? What of inequality of trade between citiea generally, and how is the difference made up 1 16* 161 GENERAL BOOK-KEEPING. 241. If Michigan, for example, buys more merchandise of New York than New York desires of the products of Michigan in payment, the difference may be made up by sales of the products of Michigan to New England, and the balance due to New York may be paid in the drafts of Michigan on New En^nd. Any difference arising in this or any other way, it is plain can be made up by sending specie, or bank notes redeemable in specie, to the city or country whose sales are the largest, in such amounts as shall be necessary to make up the deficiency. In such cases the equilibrium can be restored through the agency of Banks of Exchange, with greater expedition, economy, and safety, than by individual dealers without the aid of banks. 242. It is manifest that the principles just elucidated will apply with like effect in equalizing exchanges between Chi- cago and Boston, Cincinnati and Philadelphia, New Orleans and St. Louis ; or between any two of these cities, and between all cities and countries however remote &om each other. BANKS OF DISCOUNT. 243. All production results, as we have seen, from the application of industry to capital. (Art. 209.) Now the closer the connection between industry and capital, the more rapid will be the increase in production. But some men have mdustry and skill, without capital, and must hence labor, if at all, for others ; while other men have capital, but from age, or circumstances in life, have not the industry and skill which are required to be united with it in order to render it productive. It is manifest that, in such cases, both parties may be benefited by an equitable arrangement for uniting Quest.- 241. When the trade hetween Michigan and New York is nneqaal, how may the difference be made up ? How may any difference aZway« be made up ? Ar» banks in ench cases Berviceable? —242. Of how general application are these prin- ciples? — 243. Of what is production the result r When one person has industry tad sluU, and another has capital, how may both paTtioti be benefited i 162 BANKS OF DISCOUNT. the industry and skill of the former with the capital of tha latter. But how shall this union be accomplished ? 244. Now, Banks of Discount offer facilities for bringing together borrower and lender, and for the union of the indus- try and skill of the one, with the capital of the other, in such a manner as shall be most advantageous to each. Banks are enabled to perform this office on much the same principle that gives merchants the abUity to serve the community in facilitating exchanges. (Arts. 222 to 225.) 245. Persons who have money which they wish to lend, associate themselves together and establish a bank, at which others apply, who wish to borrow. The stockholders appoint a president and cashier, and elect the necessary directors to superintend the business of the bank. These officers devote their attention to the safe and advantageous loaning of money, and to looking after the varied interests of the bank, without requiring the constant attention of the stockholders generally, who are thus left at liberty to engage in other pursuits. 246. While banks are thus taking care of their own money, they are enabled often to serve their neighbors in the safe-keeping of any moneys they possess, which they do not wish for" the time to employ in business themselves, while at the same time the banks may derive sufficient advantage from the use of such moneys to compensate them for their trouble. It will readily be seen that such an arrangement affords greater facilities for the constant union of labor with capital, and for the increased productiveness of a country, than would otherwise exist. "While banks are thus beneficial to the whole community, they will be especially advantageous to both borrower and lender. Quest. 244. For what do Banka of Discount offer faoil'ties 1 How are banks enabled to peiform this service ? — 245. How are banks organized, and what oflScers are employed ! — 246. How may banks be setviceable to their neighbors in the safe-keeping of moneys ? How are banks compensated for the care of such moneys? How do such arrangements affect the union of labor with capital ? To whom, theiv are banks beneficial, and to whom are they especially advantageons 7 163 GENERAL BOOK-KEEPING. 247. Savings Banks, which are of recent origin, de- serve to be mentioned in this connection. While Banks oi Discount generally and properly decline to pay interest on moneys deposited with them, and subject to withdrawal at any time, and dislike to receive small sums on deposit at aU, it is the design of Savings Banks to afford those who have any thing to spare, though in small amounts, an opportunity to deposit their savings in safety, and to receive interest for sums deposited from time to time, by which means they pro- vide against seasons of sickness and distress, and insure a competency for age. This can be done, when moneys so deposited are not subject to be withdrawn without timely iiutice, and still pay &few responsible persons for the care of the savings of the rnany who deposit in them. 248. Savings Banks, which were first established in Great Britain in the early part of the present century, have been rapidly introduced into most civilized countries, and with great advantage to that class of persons for whose benefit they were established. They also benefit . the prudont bor. rower, and the whole community ; for while they encourage industry, temperance, and frugality, with the poorer classes, they at the same time serve more closely to unite the entire capital and industry of the country. (Arts. 214 to 217.) BANKS OF CIRCULATION. 249. "While Banks of Circulation usually perform the functions of Banks of Deposit, of Exchange, and of Discount, as we have already considered them, they add thereto the fea- ture of issuing their own notes for circulation as money, which notes are redeemable in specie on presentation at the bank. Ci>;EBT. 247. Do banks generally pay in 170 RECAPITtTLATION. 268. The study and practice of Book-keeping would greatly promote the public good, by facilitating exchanges, and in diminishing the amount of the circulating medium that would otherwise be necessary therefor. The machinery of civil society would be thus more economically carried on, and from the numerous checks that would in this way be thrown about individuals in their public and private intercourse, the temptations to dishonesty would be diminished, and the prin- ciples of integrity strengthened. 269. "While we have remarked upon the circumstance and conditions that contribute to success in business, and to the welfare of the community at large, the causes of want of pros- perity can hardly fail to be manifest. Whenever any of the conditions that have been mentioned as essential to success, are violated or disregarded in any community, then will the prosperity of individuals in that community, and of the whole community, decline in proportion. There is, and can be, no royal road to riches. "Wealth, or a moderate competence even, is generally attainable only as the fruit of long and well-directed industry. "Wherever consumption exceeds pro- duction, there must abundance and happiness, less or more rapidly, give place to poverty and misery. Men may, for a time, seem to be prosperous while violating the law of reci- procity. But real prosperity, and enduring good, are attain- able only by the active employment of our faculties in har- mony with the established laws of the Creator. Quest. 268. What would be the effect of the general study and practice of Book- keeping? How would it affect the amount of circulating medium required? What of its " checks " upon individuals 7 — 269. When will the prosperity of individuaUj and of a commmiity decline ? Is there any royal road to riches ? How, only, u wealth, or a competence, attainable ? What will result when consumption exceeds production? What is said of seeming and naX prosperity? 171 PART FOURTH. DOUBLE ENTRY BOOK-KEEPING. Akt. 270. Double Entkt is a system of Book-keeping in which every transaction is tieice entered; first on the Dr. side of one or more accounts, and then on the Cr. side of one or more other accounts, to which it also belongs. It is from this circumstance that it derives its name. Double Entry is especially adapted to the wants of persons engaged in a whole- sale trade, or in any business which is complicated. 271. In Double Entry Book-keeping three principal books have generally been employed, viz.: a Day Book, a Journal, and a Ledger. But many of our best book-keepers now dispense with the use of one of these books, by com- bining all that is essential of two, in one, and thereby save to themselves much time and labor in writing. A set of books should contain a distinct and systematic record of all we wish or need to know about our business. That is the best system of Book-keeping which is most easily kept, which enables us most readily and certainly to know the exact state of our affairs, ^nd which is most intelligible to others. 272. In this treatise the Journal and Ledger, only, are used as principal books. The Transactions in the Examples for Practice contain the information usually given in the Day Book. References are made in the Journal, when necessary, showing where sums entered may be found, and on what Quest. 270. What is Double Entry Book-keeping ? To whose wants is it especially adapted ? — 271* How many principal books are generally kept in double entry, and what are they ? With what do many of our best book-keepers dispense ? What should a set of books contain 7 What is the begt system of Book-keeping ? — 272. In Ibis treatise what books ool; are used? What references ace made in the Journal > * . , 172 DEFINITION OF BOOKS. accounts they have been received or paid. These references are generally made either to the Invoice Book, (see entries * 8, 6, and 8, of Journal A,) or to the Sales Book, (see entries 3, 4, 5, etc.) When not to one of these, the nature of the transaction will suggest the proper reference phrase. DEFINITION OF BOOKS. 273. The Intoice Book is a book in which are entered at length all Invoices, or bills of goods purchased. It may be made by copying invoices into a blank book, or by pasting the original invoices into a book made for that purpose. When invoices are numbered and placed on file, as recom- mended in Art. 156, they may be referred to by number. 274. The Sales Book is a book in which are entered at length all bills of Mdse. sold. (Aft. 157.) 275. The Journal either contains the particulars of every business transaction, or it makes special reference to the name and page of the book in which they may be found, or if to papers on file, to their title and number. In it the entries are so recorded that they may be readily posted to their proper accounts in the Ledger. It is ruled like the Day Book in the Third Form of Accounts, but is used dif- ferently. The Dr. sums are all entered in the left-hand columns, and the Cr. sums in the right-hand columns. 276. In .case there are several Dr. items in an entry, to be posted to as many different accounts, their sum will exactly equal the sum of the Cr. items. In such cases it is customary • By referring to the entries in the Journal it will be seen that they are nnmbereA fn fiill-faced figures. This has been done in order to facilitate the reference to par- ticular entries in giring explanations of the mode of making the Journal entries, of posting tbem to their proper accounts in the Ledger, and of balancing the accounts. Quest. 272. To what books are these references generally made ? — 273. What is tho Invoice Book? How may it be marie? When invoices are numbered and pla..ed on file, how may they be referred to ? — 374. What is the Sales Book ? — 275. What does the Journal contain? How are the entries recorded in it? How is it ruled ? Where are the Dr. Fnms entered, and where the Cr. sums? — 276. When there- are several Dr. items in an entry tobeposted to as many different accounts, what will theil sum exactly equal f IS* . 178 DOUBLE ENTRY BOOK-KEEPING. to use the word "Sundries" before the several particulan that are entered at the Dr. side of the account, as in entries 1 and 6 of Journal A. In entries 3 and 11 the reverse is true, the Dr. entries being posted to one account, and the Cr. entries each to sundry accounts. The word " Sundries," how- ever, in such cases, although sometimes employed, is not used in the annexed Journal, nor is it uniformly employed in Dr. entries. The /ac< of there being "Sundries" is apparent, whether the word is employed or not. 277. In all cases the Dr. amount posted from an entry, whether to one or more accounts, should exactly equal the Cr. amount. The general principle is beautifully illustrated in the symbol of a pair of scales on the title-page of the Book- keeping, referred to in Art. 38. The Symbol on the title- page of the Account Books particularly illustrates entry 1, Journal A. (Page 188.) 278. When a page of the Journal has been written up, Ihe money columns should be footed, and in case the Dr. and Cr. amounts exactly agree, the inference is that the sums have been correctly entered. If they disagree, it is certain a mistake has been made. The work should then be carefully reviewed, and all errors corrected, as directed in Art. 130. 279. Rules for Journalizing. In writing up the Journal, the principles already elucidated for Debtor and Creditor are applicable. (Arts. 16 to 27.) But the usual Dr. and Cr. signs are omitted. The word " To," as employed in the Journal, indicates that the titles of accounts preceding it are Dr., and those following it Cr. Of the many rules for Journalizing that might be given, none, perhaps, are superior _QuEST. 276. Whatof the word " Suudries " in such cases ? When there is one Dr. Bum in an eutry, and several Or. items to he posted against it, is tlie word " Sun. dries" then used? What /aci is apparent? — 277. To what is the Dr. amount postet? fioni an entry in all cases equal? What symbol illustrates the general principle? What symbol particularly illustrates the first entry in the Journal? — 278. How may you determine whether the Journal ontries on a page have been correctly made? W'hrn is it certain a mistake has been made? — 279. What is said of Debtor aud flreditor, and the word Tot 174 CLASSES OF ACCOUNTS. to the following, which may be the better remembered fin being expressed in homely verse. " By Journal laws what you receive Is Debtor made to what you give. Stock for your debts must Debtor be, And Creditor for property. Profit and Loss Accounts are plain; You debit Loss and credit Gain." 280. The Ledgee in Double Entry Book-keeping, like that already described, is a book to which the entries recorded in the Journal are transferred and so arranged as to present each account on a folio by itself. The instructions given in relation to the Ledger, and to Posting Books (Arts. 122 to 130) are applicable here. The letter^, in the Ledger, 8tai}ds for Journal. CLASSES OF ACCOTTNTS. 881 . The accounts in a merchant's Ledger may be classi- fied under the three following heads, — Real Accounts, Per- sonal Accounts, and Imaginary Accounts. 282. Real Accounts include all accounts of effects or things which a person possesses. Of this class are the Cash Account and the Merchandise Account. To these may ba added the accounts kept in the First and Second Forms of Account, other than accounts with persons ; such as the Corn- field Account, the Beef Account, and the Sheep and Wool Account ; also the Stone Mill, and Wagon Shop Accounts in the following Examples for Practice. 283. Personal Accounts are the Accounts kept with different persons with whom we transact business. 284. Imaginary Accounts are fictitious titles invented to represent the person or company that conduct a business. Qdest. 279. Give rule for Journalizing. — 280. What is the Lodger? For what does J'stand f — 281. Under how many heada may the accounts in a merchant's Ledger be classified, and what are they? — 282. What are Real Accounts? Mention some sccounts of this class. — 283. What are Personal Accounts?— 284. What are Imaginary Accounts? 176 DOUBLE ENTRY BOOK-KEEPING. or to supply the want of some real or personal titles in re- cording such gains or losses as cannot with propriety be placed to Real or Personal Accounts. Of this class axe Stock, Profit and Loss, Expense, and Interest Accounts. TITLES OF ACCOUNTS. 285. The Stock Account represents the person on company that conduct a business. On the Dr. side of this account are entered all the sums they owe on commencing business, and on the Cr, side, the amount of money and the value of property they carry into business. The excess of the credits over the debits will be the net amount of property invested in trade. 286. The Merchandise Account shows how much has been paid for Merchandise, and how much it has been sold for. On the Dr. side of this account are entered the value of aU the Merchandise on hand at the time of com- mencing business, and the amounts paid for all subsequent purchases. On the Or. side of the account are entered the amounts of all sales. In case the Merchandise is all sold, the difference between the Dr. and the Cr. sides of the account will exhibit the gross gain or loss on Merchandise. If any goods remain unsold, their value should be ascertained by taking an inventory of them, and then be entered on the Cr. side of the account. The mode of doing this and of ascertaining tba ffross profit in trade, and finally the net gain, is shown under the head of Balancing Accounts. (Art. 296.) 287. The E?:pense Account includes all sums that have been paid for carrying on one's business ; such as freight, clerk hire, store rent, etc. All such expenses should be en- QuEBT. 284. Mention Bome acconnts of this class. — 285. What does the Stock Account represent 7 What sums are entered on the Dr. and what on the Cr. side of this account ? How do we arrive at the net am'^unt of property invested in trade ? — > 386. What does the Merchandise Account show t Wliat entries are made on the ii\: and what on the Cr. side of this account 7 IIow is the gain or loss on Merchandise necessary to balance the account is then entered on the Cr. side, the same amount being likewise entered on the Dr. side of the Profit and Loss Account, as is fully explained under the head of Balancing Accounts. (Art. 296.) 288. The Cash Account exhibits the receipts and dis* bursements of Cash, including specie and bank notes. In it may also be. entered certificates of deposit, checks, and drafts, ■which are the representatives of Cash. (Art. 45.) 289. The Profit and Loss Account, as its title im- plies, is kept to show the Profits and Losses in one's business. On the Dr. side of this account are entered all hsses sustained, and all moneys paid for labor, taxes, etc., which do not belong more properly to other accounts, including the sum necessary to balance the Expense Account. On the Cr. side are en- tered all gains of whatever kind arising from one's business. 290. On closing this account, if the sum of the Cr. entries is greater than that of the Dr. entries, the difference will be the amount of Profit that has arisen from the business ; but if it is less, it will exhibit the amount of Loss sustained. 291. The Balance Account is the title of an account sometimes employed for the purpose of balancing unclosed accounts ; hence its name. In this work the Ledger Balances are obtained without the use of this account. POSTING BOOKS. 292. The instructions for Posting Books, given in Arts. 127 to 132, are applicable here. Every sum entered in the Quest. 287. On which side of the account are all expenses entered? What does the Or. side of this account contain ? — 388, What does the Cash Account exhibit ! What,may be entered in it ? — 289. For what purpose is the Profit and Loss Account kept 1 What entries are made on the Dr. and what on the Cr. side of this account? — 290. When does this account represent that a Prolit has arisen in business, and when that a Loss has been sustained ? — 291. What is the Balance AccT' jnt ? Is this account opened in the Ledger ? 177 DOUBLE ENTET BOOK-KEEPING. Dr. columns of the Journal is posted into the Ledger to the Dr. side of the account opposite which it stands in the Jour- nal ; and every sum entered in the Cr. columns of the Journal is posted to the Cr. side of the account opposite whose title it stands. The reference figures from the page of each book to the page of the other, are entered according to the instructions already referred to. The Journal page is entered in the Ledger at the left of the money columns into which the sum has been posted, and the Ledger page is entered in the Jour- nal opposite the title of the account that has been posted. 293. The seventeen Transactions of the following Illus- trative Example give rise to the first seventeen Journal entries, numbered 1 to 17 inclusive. When the student is able to journalize these transactions without referring to the Journal for assistance, he may post the entries to the Ledger. Having carefully reviewed his postings to entry 17 inclusivei. a Trial Balance should be taken. TRIAL BALANCE. 294. We have already shown how errors may be de- tected in Journal entries by adding the sums in the money columns. (Art. 278.) The Trial Balance, which is taken for the purpose of ascertaining whether the Journal entries have been correctly transferred to the Ledger, as well as to prepare the way for balancing unclosed accounts, affords a similar test of the accuracy of postings. Neither test, how- ever, is infallible ; for although riffftt sums may be entered, and in the right columns, still they may be entered to wrong accounts. Hence the necessity for constantly exercising great care in writing up all your books. QuBST. 292. How are entrieB posted from the Journal to the Ledger? — 293. How many Transactions are there in the IlliiBtrative Example, and to bow many Journal entries do they give rise ? When may the entries be posted to the Ledger ? When should the Trial Balance be talten ? — 294. For what pnrpnse is it taken f Why are not the proof tests of adding the money columns of the Journal and the ^dger infallible 7 1?8 BALANCING ACCOUNTS. 295. The Trial Balance is taken as follows : First, rule a sheet of paper as is done in case of the Trial Balance given at the 204th page. Then the two sides of every account in the Ledger should be added, and the less amount subtracted from the greater. All those accounts which wiU exactly balance should be ruled off and closed at once. This done, the titles to all our unclosed accounts, and the diiference between the footings of the two sides of each account in the Ledger, should be entered in the Trial Balance, on the Dr. side when there is a debit excess in the Ledger account, and on the Cr. side when there is a credit excess. Then, as the sum of all the debit entries posted into the Ledger is exactly equal to the sum of all the credit entries thus posted, and as we have only left off from the Trial Balance those accounts that exactly balance, it is apparent that the sum of all the entries in the Dr.- columns of the Trial Balance should ex- actly agree with the sum of all the entries in the Cr. columns^ The sums in these columns should next be added. In case the footings agree, the inference is that the Journal entries Ijave been correctly posted into the Ledger. If they disagree, ij;_is certain a mistake has been made, and the work should be reviewed. BALANCING ACCOUNTS. 296, Balancing Accounts is a systematic closing of the Ledger Accounts in order to determine whether, on the whole, there has been gain or loss in trade, how much, and how it has arisen. In the following Illustrative Example the only source of gain is from the sale of Merchandise. In case Mdse. has been sold for more than it cost and the expenses incurred in carrying on the business, there has been gain in trade ; but if sold for hss than its cost and expenses of carry- ing on the business, there has been hss. QirssT. 295. Desoritie at length the mode of taking the Trial Balance. — 296, What is Balancing AecoiintB? What is the only source of ^ain in the Illnstrativp Dxamplfl ? How do we determine whether, on the whole, there has been gain of Jpss in trade t DOUBLE ENTRY BOOK-KEEPING. 297. Every entry that has appeared in any Ledger Aa count to the date of the 17th and last transaction recorded, January 30th, has been posted from the Journal. But undei date of January 31st there are several Ledger entries, some of which have been posted from the Journal, while others have a diflfereiit origin. We wiU see how these have arisen. 298. An Inventory of Mdse. on hand is taken January 31st, when we proceed to balance the unclosed accounts. The Inventory in the Illustrative Example employed, (Art. 310, p. 187,) shows that We have on hand Mdse. to the value of , . $1471.00 We have sold, as per Cr. side of Mdse. Acct., 9233.60 Total Cr. to Merchandise Account, .... 10704.60 We have paid for Mdse. to Jan. 30th, . . . 9815.00 Balance of Mdse. Acct., Gross Profits, . . $889.60 299. We are now prepared to close the Merchandise Account, which is done as foUows : January 31st, we credit Mdse. for the amo jnt on hand as per Inventory. This entry, which is made in the Ledger in Boman letters and figures, and which is frequently entered by the book-keeper in red ink, is not brought from the Journal, but is entered as an amount on hand to the credit of Merchandise to be brought down as a Balance. (Arts. 46 and 303.) 300. The Merchandise Account now contains on the Dr. side all we have paid for Merchandise, and on the Cr. side all we have received for Mdse., together with the value of that on hand. The Cr. excess must be our gross profits in trade. Having made the calculation in Art. 298, we are pre- pared to close the Merchandise Account into Profit and Loss, Quest. 207, Do any entries except tlioae posted from the Jonmal appear in the Ijodger previous io taking the Trial Balance ? — 298. What is done before proceed' ing to balance the unclosed acconnts of the Ledger ? What is Mdse. on hand inven- t-oriod at in the present case, and how do we determine the gross proJUs in trade ? — 299. Tn closing Merchandise Account what entry is made for Mdse. on hand as pel Inventory? How is the entry made ? — 300. How is Merchandise Account closed for gross profU-s in trade ? 180 BALANCING ACCOUNTS. which is done in entry 18 of the Journal. This entry posted, closes the Ledger account with Merchandise, and opens an account with Profit and Loss. 801. AH expenses that have been incurred in carrying on the business have been posted to the Dr. side of the Expense Account. We are now, therefore, prepared to make Journal entry 19, which, when posted, closes the Ledger account with Expenses, and places an equal amount to the debit of Profit and Loss. 302. Now, on the Dr. side of Profit and Loss, we have brought all the expenses incurred in carrying on the business ; and on the Cr. side of this account appear the gross profits that have arisen in trade. The excess of the latter over the former it is evident will be the net gain. We then make Journal entry 20, which, when posted, closes the P^-ofit and Loss account, and carries the net gain in trade to the credit of Stock. We have thus closed all accounts that afiect gain or hss in trade, into Profit and Loss, which we have closed into Stock. 303. We now proceed to close Merchandise, (for Balance on hand as per Inventory,) Cash, unsettled Personal Accounts, and Stock, into Ledger Balances, of which the Dr. exhibit our Assets, and the Cr. our Net Stock and Liabilities. Balances should be taken from the Ledger at the close of each month, and be brought together in a Book of Balances. The condi- tion and history of each account, and of all the accounts of the Ledger, may then be seen ^t a glance. The merchant has thus before him a synopsis of his entire business, with Its monthly changes and variations, together with a proof of the accuracy of his postings and Ledger Balances. 304. We have thus far shown the order of closing the QinST. 301. How do we close Expense Account t — 302. What is the condition of Profit and Logs acct. and how do we close it? — 303. What accounts are closed jnto Ledger }:aiances, and what do these balances represent ? What is said of a Fook «f Balances, and what advantages result from its use! 16 i ^ l-H o M 1 QO M ^ 1-^ ?Z3 HH t-1 i i pq U I M o pp CLOSE INTO LEDGER BALANCES, sssasssasgaa^a) OF WHICH Cssasesasasiageg ga The De. Exhibit OUR ASSETS, ^SjJBSsageg The Ck. our NET STOCK and LIABILITIES. ssgaBseaessiaesggisssaissgaeis i?\v^9 DOUBLE ENTKT BOOK-KEEPING. 307. The form of entry we have observed in closing Ex, penses, (Art. 301,) wiU apply to Merchandise, Interest, Stone Mill, or any other account indicating gain or loss in business, in case the sum of the Dr. entries to it exceeds that of the Cr. entries. And should the Dr. side of Profit and Loss exceed the Cr. side, the difference will go to the Dr. of Stock, and the closing entry of the Journal will be, Stock Dr., for hss in trade, to Profit and Loss. The Stock Account will appear among the Dr. Ledger Balances whenever one's Liabilities exceed his Assets, or when he owes more than he possesses. Whatever amount of property one actually possesses, above his debts, (if any,) will stand on his Ledger to the Cr. of Stock, and may be considered as a positive quantity. But when there is an actual indebtedness, beyond one's ability to pay, the amount will stand on his Ledger to the Dr. of Stock, and may be regarded as a negative quantity. 308. In the Double Entry Ledger, /" as has already been intimated, stands for Journal. The ^5 and ^w, which are the usual signs of Dr. and Cr. entries, are often omitted in the Ledger. When a Day Book is used, the Journal entry frequently .occupies but a single line, thus : (^ '^ -Wcac/wau/ ^ ^^. to ^^ 0>c^A In such cases two columns are required at the left for post marks : the one at the extreme left for the Dr. entries, and the other for the Cr. entries. In all other respects the Posting should be conducted as from the following Journal to the Ledger. In the above Journal entry, S. C. Woodward & Co., •preceding the word " to," are Dr., and Bills Payable, foUow- ing it are Cr. (Art. 279.) Dr. sums are entered in the left' hand set of money columns, and Cr. sums in the right-hand set. Quest. 307. To what will the form of entry oliserved in closiog expenses apply? When will Stock be made Dr. In doping Profit and Loss? When will Stock appear among the Br. Ledger balances? When mar ^tock be regarded as a jposi^ve quan. tity, and when as a negaUvt quantity? — 308. In the Double Entry Ledger what does .T* stand for ? What of JbaudS^/ When are two columns reqnired fiir ppfltf marks ? What of posting in other respects ? Where are Dr. and Cr. sums entered ? 184 ILLUSTHATIVE EXAMPLE. ILLUSTRATIVE EXAMPLE. FOURTH FOBM OF ACCOUNTS. 809. For the purpose of illustrating the method of open- ing a set of books, and the mode of journalizing and posting transactions, but more especially for the sake of showing clearly and distinctly the method of closing a, set of books in Double Entry, the following Illustrative Example is here introduced. It can not be too carefully studied. Jfonday, January 2d, 1880. Transaction 1. I commence business this day with the following effects : Merchandise in Store, worth, as per Inven- tory, $4600.00; Casn in safe, $2500.00; two Notes, one No. 3, against John Otis for $1500.00, and the other. No. 4, against Henry Brown for $1200.00. TV. 2. I owe Hill & Wright on account for Mdse. as per Invoice Book A, p. 8, $1350.00, and Clark & Smith, as per Invoice Book A, p. 12,_$1250.00. Tuesday, January 3d, 1880. Tr. 3. I have this day sold Mdse. to S. C. Wood & Co., as per Sales Book A, p. 15, amounting to $2450.00. • Thursday, January 5th, 1880. Tr. 4. James Armitage has bought Merchandise of me, on acct., as per Sales Book A, p. 20, amounting to $1240.00. Friday, January &th, 1880. IV. 5. I have sold Mdse. to several persons, as per Sales Book A, p. 25, amounting to $840.00, for which I have received Cash. Qdisi. 309. Wby is tbe Illustrative Example Introduced in Double Entry 7 18S DOUBLE ENTET BOOK-KEEPINS. Monday, January 9th, 1880. Tr 6. I have bought Mdse. in New York, as per Invoice Book A, p. 18, amounting to $2480.00, for which I paid the Cash. Mj expenses amounted to $30.50, and I paid $65.50 for freight on goods bought. Tuesday, January 104anc^iie «» (^kyce . 4600 00 S '^aa-h vn, ^^aJa S500 00 3 '/ ^, ^^y ^zowm, 4S00 S700 00 / 1 e% mocd . . . pi'oo 00 / e5i«/ ^e. 3 " ^^^//^^^ . S600 00 3 ^350 00 $ ^S5() 00 ^•W. .?// S S450 00 / 3 ^^ Q/^ietehanc^e S450 Oo 3 e5^^ ^tfo/ ©<;6, i>^ . . 4S40 00 / 4 ^o Q-^^ewdoMt/tae fS40 OO S 'gk^r Q!^. ^a/eo ^oie^mi on «^, 37.60 8 <^o '-&aad .... Q^z. "o. 3 9 ^ S^ 10 ^ e^. fr. 30 96 00 00 /650 00 ^460 65 ^500 00 ^074 60 00 60 00 S576 00 ^650 00 ^5S5 60 fSOO 00 i07^ ^oa '60 189 3 Q^rie^u, 2anua^u /6^€4, ^S8.0. S ^CUi/i QSz. - i^a^ ^ood e^. fr. 35 . . S44i 60 / fS4^ / e^/6. ^^ . . ri5 00 / 14 ^o Q/^(euAami/tae 7i5 00 s 460 90 4 Kix^emaea 50 1 w 9 15 ^ ^a^ .... 540 00 7593 60 U 7593\ f(? uo 1 -ggp-? . „ . — _ . Q^ne/ay, ofamuMy 30^, ^S80. ^ 16 ^^ Q!z '6€gn£ QSz. 17 " <=&a^4, . , . 0!t 18 &o ^ioffii ana c^SiM / 19 d^o ' ■it amc^ ,2B}nM.frS 500 00 ^a^i, fr. S s^^s 00 3^^§^^t./..3 6/5 oo ^.^."Wooc^^cS S650 00 ^ S060 00 ^^^^ /.S'J'/.? 00 0^3/5 00 Ans. 2d. Dr. LEDGEB BALANCES. February 1st, 1880. Or. "Waii, ft. 9 0/474 S^/S S650 S060 00 00 00 00 3^/^t^/U,f..3 07i7i 500 6/5 00 00 00 0ip93 00 0^993 00 Am. 3d. MY ASSETS AND THEIR VALUE. My Assets, February 1st, 1880, consist of 1st. Merchandise as per Inventory, $1471.00 2d. Cash, as per Cash Acct., . . 2812.00 3d. S. C. ■Wood & Co. owe me on acct. 2650.00 4th. Jas. Armitage owes me on acct. 2060.00 Total amount of Assets, . . . ~. '. '. $8993.00 ILLUSTRATIVE EXAMPLE. Amount of Assets brought up, . . $8993.0d Ans. 4th. MY LIABILITIES, AND TO WHOM. 1st. I owe Clark & Smith on acct. $500.00 2d. I owe Hill & Wright on acct. 615.00 Total amount of Liabilities, $1115.00 Ans. 5th. Met Value of my Stock, Feb. 1st, 1880. $7878.00 Net Value of my Stock, Jan. 2d, 1880. 7200.00 Ams. 6th. Mt Gain in trade for January, . . $678.00 311. The student will find this Illustrative Example solved on pp. 188 to 195, with a fiill explanation of the whole procedure in Arts. 293 to 303. These may be freely con- sulted till tie learner becomes familiar with the method of opening, journaMzing, and especially of closing a set of books ; but he should not pass on till he is so familiar with all the •principles involved as to be able to explain every step taken without reference to the book. The great beauty of the science of Double Entry is readily apparent in the work of this Example. From the first Journal entry, on page 188, there has been a perpetual equilibrium of accounts. The debits entered from each transa,ctJon have been exactly equal to the credits. The footings of the Dr. and Cr. columns of every page of the Journal agree in amount. The equilibrium appears again in the Trial Balance, on the last page, and finally in the Ledger Balances there given. In case the learner acquires a thorough mastery of these principles, and is alike thorough with the following but more difficult Exam- ples for Practice, he will readily become an accomplished book-keeper. Is not this result worth the efibrt ? Quest. 311. What is said of the Illustrative Example ? What should the learner be nble to do before he passes from this example ? What Is said of the beauty of Doub'e Entry ? What of the eqyMbriwn of accounts ? What vfiW result from « Ifiufouffk mastery of these principles 2 17* 197 DOUBLE ENTKT BOOK-KEEPINO. EXAMPLES FOR PRACTICE. FOUBTH POBM. — PABTNBBBHIP. 312. In Paktnekship each Partner's individiud dealings with the Finn are conducted in all respects on the same basis Bfl other 'personal accounts'. Each is debited for what he re- ceives from the Firm, and for what is paid on hia account, and credited for what he brings to the Firm, and for what is received on his account. (See Arts. 199 to 201.) The Opening Journal Entries of this example will be made on the same principle as were those of the former example ; and they will be in amounts as indicated in the Ledger Bal- ances at the 196th page, with this difference: The Cash and Stock will each be $5000.00 more than there, on account of Capital brought to the Firm by the incoming Partner. Wednesday, February 1st, 1880. Transaction 1. I have agreed with Phmeas Graves to receive him as a Partner in a General Mercantile Business, to be conducted under the title* of "Mayhew & Graves." I put into the business all of my Assets, as given in Ans. 2d of the last example, and the Firm assume my Liabilities, as there given. (See Ledger Balances, p. 196.) TV. 2. P. Graves brings with him into the Firm a Cash Capital of $5000.00, and we have agreed to share the gain or loss in trade equally. Thursday, Fehmary 2d, 1880. Tr. 3. S. C. Wood & Co. have bought Merchandise of u» en account, as per Sales Book B, p. 1, amounting to $140.00, * Where the 8ixthor*B name is employed in this Example the stadent may subBtl* tnte his own name, thus making himself the senior partner of the firm conducting the business. The name adopted must be uniformly employed. QniST. 312. In Partnership how are the partners' individual dealings with the rirm conducted! For what is each partner debited, and for what credited ? What Is remarked of the Opening Journal Entries in Partnership ! What partnership has ^een formed, and with what capital ! What is the title of the Firm f Whom will tlM Itudent regard as the senior partner ? 198 EXAMPLES FOB PEACTICB. JV. 4. James Armitage has paid us $1060.00 in Cash, and has given us his Note, No. 1, for $1000.00, payable at our Store in 30 days, with interest at 6 per cent. Monday, February 6ih, 1880. TV. 5. We have bought a Wagon Shop, and lot, of Henr; L. Haywood, for $900.00, with tools and stock inventoried ai $400.00. We give him in payment $500.00 in Cash, and our Note, No. 1, for the balance, at 30 days without interest. We propose to keep an acct. with Wagon Shop. (Arts. 39 and 40.) Tuesday, February 7th, 1880. Tr. 6. Ve have bought Mdse. of S. C. Hooker & Co. oi New York, as per Invoice No. 1, amounting to $3750.00. Our expenses attending the purchase were $37.40, and wa paid freight on goods, $45.10. We gave our Note, No. 2, to Hooker & Co., for $2250.00, payable at the Exchange Bank in 3 months, with interest at 6 per cent, after 30 days. The balance of Invoice and our expenses we paid in Cash. Saturday, February 11th, 1880. Tr. 7. John Porter has bought a bill of Mdse. of us, as per Sales Book B, p. 8, amounting to $1186.00. Of this sum he has paid $326.00 in Cash, and the balance we chaxge him in account. Monday, February lUh, 1880. Tr. 8. We have purchased a stock of Lumber of Henri/ King, for Wagon Shop, to the amount of $1775.60. We have paid him $225.60 in Cash. The balance of the purchase is on account. Wednesday, February 15th, 1880. Tr. 9. We have leased of John Johnson a Stone Flour- ing Mill, worth $12000.00, for five years. The rent agreed upon is 10 per cent, per annum of the value of the property DOUBLE ENTRY BOOK-KEEPING. at this time. We pay 3 months' rent in advance ; we also pay $256.00 in Cash tor sundry fixtures received with the Mill. We propose to keep an account with &one MiU. (Arts. 39 and 40.; Thursday, Fekruary \Qth, 1880. Tr. 10. We have sold Mdse. to Isaac Newton, on acet, as per Sales Book B, p. 16, amounting to $280.50. Monday, February iOth, 1880. Tr. 11. We have bought of James Bronson 1860 bushels of White Wheat for Stone Mill, at $1.20 a bushel, for which we have given our Note, No. 3, payable in 10 days, in Wagons and Sleighs. Wednesday, February 22d, 1880. Tr. 12. We have sold to John Porter 8 Cutters, at $45.00 each, and 1 Buggy for $120.00, and charged the same to him in account. Friday, Februan; 2ith, 1880. Tr. 13. L'a May hew has tj,ken from the Wagon Shop a Cutter, for his own use, woith $45.00, and Phineas Graves has taken a Sleigh, worth $50.00, which are charged to them in account. Monday, February 27th, 1880. Tr. 14. We have bought $2800.00 worth of Mdse. of Henry Underwood, as per Invoice No. 2, for which we have delivered to him, at the Stone Mill, 300 bbls. of Flour, at $6.00 a barrel. We have paid him the balance of Invoice out of the Wagon Shop, in Buggies, at $125.00 each. Wednesday, February 29Mi^Smman,A. 4 47S0 00 Si^tM S^Mia, ft,. 7 47iO 00 4S40 4 is iss i745 00 60 50 00 'Wa^(m.^4o/t.,/i. 4S S4SS 00 90 &^aae eyrewtom, fi. P^ aafienaeti, h. 40 ^o£n, 0{>zeei, /i. 40 440 95 &3i 4563 00 50 50 00 / 4p606 90 49606 90 314. The page is given, in the preceding Trial Balance, to conform to the page of the Ledger as the example is. worked in the Key. The balances to these several accounts will be the same, regardless of the Ledger pages they occupy. The learner, I need hardly here add, hds a right to feel en- couraged with his progress in proportion as he is able to obtain correct results without aid from his teacher, and without consulting the Key. Quest. 313. What is said in relation to tailing a Trial Balance ? — 314. Will the result of the Trial Balance depend in any degree upon the arrangement of account! in the Ledger f 204 EXAMPLES FOR PRACTICE. Tuesday, April 3d, 1880. Tr. 35. S. C. Wood & Co. have received from Henry King his Draft on us for $1275.00, which we accept. We pay them $125.00 in Cash, furnish them with a Carriage from the Wagon Shop worth $225.00, and place the balance of the Draft to their credit in acct. Thursday, April 5th, 1880. 75- 36. Clark & Smith present an Order on us from Henry King for $125.00, which we accept. They deliver at the Stone Mill, on acct., 325 bushels of Wheat worth 95 c. a bushel. We settle our acct. and they give us their Note, No. 5, for balance of acct., payable at our Store in 30 days without interest. Friday, April Gih, 1880. Tr. 37. We sell $2500.00 worth of Merchandise to James Armitage, on acct., as per Sales Book B, p. 75. Monday, April dth, 1880. Tr. 38. We sell to John Hinman, on acct., 8 Lumber Wagons at $65.00 each ; 160 bbls. of Flour at $6.00 a barrel ; and $327.75 worth of Mdse., as per Sales Book D, p. 1. Thursday, April 12th, 1880. Tr: 39. TVe have bought Bams & King's Note, No. 6, of John Hinman for $3000.00. Said Note is indorsed by Hinman to us, has drawn interest from February 1st at 6 per cent., and is payable May 21st at the Exchange Bank. We credit Hinman in acct. for the Note, and allow him interest on same for 2 months and 10 davs. Hinman this day fur- nishes us with Invoice, No. 6, of Lumber for Wagon Shop, amounting to $254.60. Saturday, April lith, 1880. Tr. 40. John Paywell has this day tak^n up his Note, IS 205 DOUBLE ENTRY BOOK-KEEPING. No. 2, given the 14th of March, payable at the Exchange Bank, * and drawing interest. Monday, April \Uh, 1880. Tr. 41. "We have bought Mdse. in Boston of Josiah Wall, as per Invoice No. 6, amounting to $3400.00. Our expenses attending the purchase were $35.00, and we have paid $23.00 freight on goods bought. We have given our Note, No. 4, for $2500.00, payable in 60 days. Our expenses and the balance of Invoice were paid in Cash. Friday, April 20th, 1880. TV. 42. We have sold S. C. Wood & Co. Mdse., on acct., as per Sales Book D, p. 10, amounting to $1125.50; 8 Bug- gies at $105.00 each ; and 60 bbls. of Flour at $6.00 a bbl. Monday, April 23d, 1880. Tr. 43. James Armitage buys of us one Single Wagon for $125.00, and 20 bbls. of Superfine Flour at $6.50 a barrel. He pays us a Certificate of Deposit of $2500.00 with the. Exchange Bank, where we keep our bank account, and which we use as money. The overplus we pass to his credit in acct. Thursday, April 26th, 1880. Tr. 44. S. C. Wood & Co. have paid us $500.00 in Cash, on acct., and have delivered at the Stone Mill for us 800 bushels of Wheat at $1.05 a bushel. Tuesday, May \st, 1880. Tr. 45. S. C. Wood & Co. have paid their Note, No. 4, of March 29th, due this day at the Exchange Bank with interest. * We keep our Bank Acct. with the Exchange Bank, and any moneys paid us there we place to the debit of Cash. Notes of ours falling due at the bank, and paid by ths bank for as, we place to the credit of Cash, as though paid by us in person. 20e EXAMPLES FOB PRACTICE. Thursday, May 3d, 1880. Tr. 46. James Armitage has bought Merchandise of us, on acct., as per Sales Book D, p. 25, amounting to $1240.75. 2V". 47. John Hinman has bought of us, on acct., as fol- lows: Mdse. as per Sales Book D, p. 30, amounting to $1422.00, and 20 bbls. of Flour at $6.40 a barrel. Saturday, May 5ih, 1880. Tr. 48. Clark & Smith have paid us their Note, No. 5, given April 5th. Monday, May 7th, 1880. Tr. 49. We have paid our Note, No. 2, given to S. C.- Hooker & Co. Feb. 7th, and this day due at the Exchange Bank. Tuesday, May 8th, 1880. Tr. 50. Henry King has delivered $475.00 worth of Lumber at the Wagon Shop on our account, as per Invoice No. 7. He presents an Order on us from Fhineas Graves for $125.00, $75.00 of which we pay in Cash, and place the balance to the credit of King in acct. Thursday, May Wth, 1880. Tr. 51. Isaac Newton delivers for us at the Stone Mill 603 bushels of Wheat at $1.00 a bushel, and brings an Order on us from Ira Mayhew for $240.00, on which he receives $124.50 in Cash. He buys of us 24 Lumber Wagons at $60.00 each ; aU of which is entered in account. Saturday, May 12th, 1880. TV. 52. S. C. Wood & Co. have made an assigument, and offer to their creditors 60 cents on a dollar. We settle with them on this basis, and take an accepted Order on James Armitage for the amount agreed upon, which we charge to Armitage v? "cct. 207 DOUBLE ENTET BOOK-KEEPING. Tuesday, May Ibth, 1880. Tr. 53. "We pay 3 months' Rent of Stone Mill at the rate named in "the transaction of February 15th. Friday, May \ith, 1880. Tr. 54. "We have sold Hill & "Wright Mdse., on acct., as per Sales Book D, p. 36, to the amount of $750.00, and 25 bbls. of Flour from the Stone Mill at $6.00 a barrel. Monday, May 2\st, 1880. Tr. 55. Bams & King have paid their Note, No. 6, which we , received of John Hinman April 12th. (For amount, time, etc., see transaction of that date.) Wednesday, May 23d, 1880. Tr. 56. "We have sold our interest in the Lease of the Stone Mill, taken February 15th, with the fixtures then pur- chased, and stock in Mill, to T. Hill for $1680.00, Cash. Hill has also bought of us one Carriage for $185.00, and one Cutter for $40.00. Saturday, May 26th, 1880. Tr. 57. Simeon Rice has paid his Note, No. 3, given March 26th, with interest, as per transaction of that date. Monday, May 28th, 1880. Tr. 58. "We have settled with hands employed in "Wagon Shop, and paid $1062.30 in Cash for Labor and Stock to date. We have also paid $2203.25 for Labor and Stock for Stone Mill to date. These sums anj in addition to amounts heretofore paid for these purposes. Tuesday, May 29th, 1880. Tr. 59. "We have bought Merchandise as per Invoice No. 8, amounting to $2212.00. Our expenses attending tlw EXAMPLES FOR PRACTICE. purchase, including freight and insurance, were $32.62. We gave in payment our Note, No. 5, to Hatch & Jones, of New- York, for $1200.00, payable at the Exchange Bank in 30 days. The balance of invoice and expenses we paid in Cash. Wednesday, May Z^th, 1880. Tr. 60. We have attended the Mechanics' Fair, and ex- hibited samples of Merchandise, of Wagons, and of Flour. We receive a Cash premium of $30.00 on Wagons, and another of $20.00 on Flour. Our expenses in attending the Fair have been $45.50. (Profit and Loss.) Inventory of our Effects, May 31st, 1880. 315. On taking an Inventory of goods we find we have" on hand Merchandise in Store worth $3587.52. On taking an Inventory of Wagon Shop, and Stock in Shop, we find they are together worth $900.00. Required to Determine the following Hesults: 1st. Give the Trial Balance taken May 30th, 1880. 2d. Give the Ledger Balances as ascertained May 31st, and brought forward under date of June 1st, 1880. 3d. Give the Value of our Assets, as derived from these Transactions, and state in what they consist. 4th. Give the Amount of our Idahilities, as derived from these Transactions, and state in what they consist. 5th. Determine the Net Value of our Stock, June 1, 1880. 6th. Give the Net Value of Stock belonging to each Part- ner, after paying his indebtedness to the Firm. (Art. 3 J 2, Trs. 1 and 2, p. 198.) These several results, which it is required to determine, and the calculation for the 6th and last, are given on the two following pages. On obtaining them, the learner has occa- sion for congratulation, 18* 209 DOUBLE ENTRr BOOK-KEEPINO. TRIAL BALANCE. Ans. 1st Dr. May 30i!A, 1880. Cfr Q/KeuMam/Ms S36S 90 ^^U 4Si7^ 00 ^a,A '/00A6 67 efnteieai pi 6p Jaa. ^^i/mUaae ^70S 05 3700 00 ^onn a^inman /T^i 45 P03 00 &^Atnea4 '-ataoea S/0 60 0>./a^^ 35 io S^t^ Jf /rimM ass 50 eJ^^e^O' 4575 00 efta &^ayAetif 350 00 ^«^e%k 4^55 00 ef^aac eA^eiiiion ^a 00 / Sa^ienM^ 374 6S y^ ^oAn ^intei 4563 00 X S4037 49 S4037 49 I 1 ^DGER I « lALANCES. \ ^MS. 2d. Dr. June \a, 1880. Or. G'^ete4anciiie 35i7 5S e^^^ 4^4^? 49 ^aJi 40046 67 ^«^ 0ii.ya^A 3700 00 ^od, e>€!9nitage i70S 05 Si^ty &^*tta p05 oo £>4m SiSiiMn(in 47i^ 45 / ^^^Tiead ^ta^ 340 60 / ^^/ K^^dt 47SS 50 350 00 / i47 00 / £>nm &{niet 4563 00 / yjl^a^on^4ofr poo 00 49 / SS7i7 Jp SS7i7 21 EXAMPLES FOK PRACTICE. Arts. 3d. The Dr. Ledger Balances on the opposite paga are our Assets, and consist of Merchandise, Cash, "Wagon Shop^ and Personal Accounts, amounting to $22787.49. Ans. 4th. The Cr. Ledger Balances, except Stock, are our lAabilities, and consist of Bills Payable, and a Personal Account we owe Henry King, amounting to $4605.00. Ans. 5th. The Net Value of our Stock, including the indebtedness of both Partners to the Firm, is $18182.49. Ans. 6th. Net Value of Ira Mayhew's Stock after paying his personal indebtedness to the Firm, $10180.245. Net Value of Phineas Graves's Stock after paying his personal indebtedness to the Firm, $7341.645. Although the calculation for determining the Net Stock of each Partner is given below, still the learner will derive • advantage from making his own analysis, and reaching the result himself, as he will be compelled to do in actual business. Ctdcvtation for Ira Mayhew's Net Stock. Net value of our Stock June 1st, Net value of our Stock Feb. 1st, Net Gain to be divided equally, . Net Gain of each Partner, . . . Ira Mayhew's Stock February 1st, Ife Mayhew's Assets June 1st, Deduct his indebtedness to Firm, . Ira Mayhew's Net Stock, . . . $18182.49 128 78.00 $5304.49 ■ $2652.245 7878.00 $10530.245 350.00 $10180.245 Ccdculntion for Phineas Graves's Net Stock. Stock of Phineas Graves Feb. 1st, .... $5000.00 Net Gain of each Partner, . . . Phineas Graves's Assets June 1st, Deduct his indebtedness to Firm, . Phineas Graves's Net Stock, . . 2652.245 $7652.245 310.60^ "$7341X45 211 GM>^ am/ ^u No. Sate. Maker's Name. Indorser'8 Name. /i^o. &Vo.'f ^J. 9 Q/i^one // 9 &^UM,. ■f4 ti 3 1/ S6 QrtmeoTi ^^*ee £>An (V<)aceti " ^ // 39 Q^ome " 5 S^. 5 oA^one " 6 S^ed. / fo4m S&mntan QM>^a an 9 c. . . 9 Yds. Bl'k Cloth® $4.50 2 Boxes Eaisins la) $3.00 1 May 5th Cash Sales this week per C.B, To Mdse. . . . -May 8th Wm. Cook To Mdse. . . 14 lbs. Putty ® 8 c. . . 12 Yds. Bl'k Silk fa) 90 c. 44 " Cotton Cloth f® 9 c. May 10th Store Expenses For Eep'rs on Store per Bill To H. Allen May Vlth. Cash Sales this week per C. B, To Mdse. . . . May lith. John Hill For Order to his Son To Mdse. . . . Mdse. carried forward 216 2700 47a 275 350 450 1 40 6 125 00 00 1 10 15 200 24 4679 50 00 35 03 Sand'* Cr. 3800 00 230 220 15 413 4679 50 48 30 125 15 00 88 200 00 24 35 413 53 !^o^^lon, Q/i(utadiy, QS^m //^, ^S80. 2 Mdse. brought forw.'vtl John Cook To Mdse. . . 26 Yds. Sheeting ® 25 e. 12 " Blue Silk® 7-5 c. 18 lbs. Cru'd Sugar ^oi 9c. 19. To Mdse. . . . May 28tk - — Ira Graves To Mdse- . . 10 lbs. Cru'd Sugar r» 9 c. 4 Yds. Cassimere.® $2.50 -May 30th. — : Store Expenses For 1 Chsindelier. To Cash . . -May 31st. Ira Graves To Mdse. . . 8 Yc!s. Cambric ffl 9 c. . iO " Gingham ® 31 c. 7ot&l Mdse. Credits for month 413 6 9 1 32 227 52 225 10 990 15 60 00 50 00 Siind's Cr. 10 00 20 952 62 990 00 00 62 62 413 17 Cr. 53 12 22 227 32 225 10 15 60 00 50 90 182 952 63 IB 217 DOUBLE ENTET BOOK-KEEPING. When the learner has posted the Illustrative Example journalized on pp. 216 and 217, and has observed the direc- tions in Art. 320, (page 215,) he will be prepared to answer the following questions : 1st. What is the Trial Balance from this Journal? 2d. What are the final Ledger Balances ? 3d. What has been the Net Gain in business? TRIAL BALANCE. Ans. 1st. Dr. May 31s<, 1880. Or. ^ur 3S (^%d, fi. S 3350 00 'WaaA, h. / 'fS35 fO £>An, a^M, ^, 3 457 35 ^.^,^^<^W4 S 375 00 S^niM &€uen, fi. 3 45 50 JoAn ^ood. fi. S 367 fS Q^a '-ataved, ii, 4 5 3i rm^a^'^cclfr.3 67 i^ ^^ ^a^Af^.4 330 00 ^iote Sx^ienae^i h,. 3 33 50 SfamiA &iAem. h. A 33 f5 37Ai ^3 374^ 43 LEDGER BALANCES. Am. 2d. Dr. June ls<, 1880. Or. e/Kezchamdiiie, fr. 4 3^60 00 ^iod, - fi. 3 3706 91 ^mI, fr. y f335 •fO ^4n S^Mi ^. 3 457 35 &S^ Mece^xid^, S 375 00 3&miu Q^&n.h. 3 45 50 £mn ^ood, ^. 3 367 rs W^0'a^&,fr.4 330 00 'Wr. LEDGEE BALANCES. Tune 1th, 1880. Or. Cash galanae 530^ pop 73 //1S8 00 50 70 83 0. ^Ol^. /J 0t^, ^ '^ood. fr. 3 /1..4 ft. 4 ft,. 5 76i4 i40 i47 544 P7 34 S5 50 00 40430 03 40430 03 Ans. 3d. Net Gain in business, $111.97. BOOK-KEEPING. OPENING AND CLOSING. 327. The first difficulty which the inexperienced book- keeper has to encounter consists in Opening the Journal so as to make the several accounts involved conform to the existing facts at the time of commencing a business. This done, the current entries required in recording ordinary business transactions are comparatively easy, and have already been sufficiently elucidated. His second and prin- cipal difficulty, however, consists in Closing the Ledger — a process by which all accounts that indicate gain or loss in trade are eliminated from the Ledger, and by which the results of the business, however complex it may have been, are exhibited in Ledger Balances. Of these the Dr. exhibit Assets, and the Or. Net Stock and Liabilities. (Arts. 304, 309, and 31L) EXAMPLES FOR PRACTICE. 328. For the purpose of increasing the familiarity of the learner with the more difficult work of Opening and Closing sets of books in conformity with the varied cases that may arise, the following additional Examples for Practice are here introduced. EXAMPLE I. OPENING. 329. I enter upon a Grocery Business, with the following Assets and Liabilities, and open my books with a [jU)ck Account. Assets. I bring into trade 100 bbls. of Sugar, weighing 200 lbs. each, and 5 hhds. of Molasses, containing 63 gallons each. The sugar stands me in 5| c. per lb., and the moiasses 27^ c. per gallon. All other Merchandise I bring into trade is together worth, per Inventory, $21,375.50. I hold Benja- QiEST. 327. What is said of Opening the .lournal ? What !s nriarfccd nf current entries in ordinary business f In what does the second and principal diflicnity of the hook-keeper consist!— 328. For what are additional Examples for Practice intro- (accd? — 329. What is stated In Art. 329? Give the Journal entry required by my Assets. Give the entry for my Liabilities. 224 TRIAL BALANCE. min Butler's accepted Sight Draft, in my favor, on Henry Paywell, for $2000.00, and a Note of Hand against 0. K Bradbury for $1200.00 due in 30 days. I have also $1500.00 in Cash, all of which I put into the business. Liabilities. There is outstanding against me an accepted Draft made by Sam. Brown, in favor of John Hunter, for $475.37, payable 10 days after sight, and my Note given to J. O. Baker, or order, for $1500.00, payable in 60 days. I am also indebted in the sum of $255.75 to Byron Howard on book account. Required to determine the following Particulars: 1st. The Journal entry for my Assets. 2d. The Journal entry for my Liabilities. 3d. The Net Value of my Stock in trade. EXAMPLE II. CLOSING. 330. The business presented in the last Example (Art. iJ29) is conducted for the period of one year, during which time I buy and sell Merchandise, receive Moneys on Bills due me, pay Bills maturing against .me, and deal in Real Estate. At the expiration of the year I take a Trial Balance, and an Inventory of Merchandise and Real Estate on hand, with the following results : Br. Trial Balance. Ct. ^eat aataie Gxcrtanqe 3750 ^0 3450 40 SS4(^0 ^5S6 30 573 is Si 753 55 3S597 S3 mj& e^aya^fe 3600 ^Smtez ^zinim, 4^0 50 ^^o/a ^^M,^ sio 75 ofniezeat S60 60 Q^MCOuni iS5 50 ■fCi>0 ssoio 4§ \3S5P7 S3 \ r = Quest. 330. What is atiited In Art. 330, and wUai Is required? 225 BOOK-KEEPING. Inventory. On taking an Inventory I find I have on hand Merchandise worth $11,376.80, and Real Estate worth $22,000.00. 1st. Required to eliminate from the Ledger all accounts indicating Gain or Loss in trade, and to present in their modified condition the final Ledger Balances. Of these the Drs. exhibit Assets, and the Crs. Net Stock and Liabilities. (Arts. 298 to 307.) 2d. Required the Net Gain in trade for one year. Ans. 1. 2)r. Ledger Balanoes. CV. ^a.4 3750 60 ^aS, &cja^^ 3600 ^^ £^ece^^A 3450 fO c^inez SSzoum. i460 50 ^ea^ e