IMAGE EVALUATION TEST TARGET (MTS) V 35 a'46 Entered accordino to Act ok Parliament op Canada, in the Year 1879, by DAWSON BROTHERS, In the Office of the Minister of Agricultuke. « ! Printed at the Gazette Printing House, Montreal. CONTENTS. Preface ";% Obsorvjitions on Book-Jceopiii <^ i Phrases and Accounts Explained. Accounts (representaiirc) [ 5 Assets [ ^ Averaging of Accounts 7 gQ Biihinco Sheet (Trial) 6 70 Balance Sheet (General) tj' 71 Bills of Exchange 4' §8 Bills Payable 4' gfr Bills Eeceivable ' 4 Brokerage 5 Commission 5 Consignment 5 Discount 5 Dr. and Cr 3 Drafts 4* 37 Exchange s' 88 E. E. and E. & 0. E .".'.'*.'.".'.".".".'*."."."'.'.'.' ".'■.'. . . .' 7 Interest 5 Journalizing 3 Liabilities 4 Posting ' 4 Premi um _ g Profit and Loss 4 Stock or Inventory 5 Sundries * 3 Books. Bank Cheque Book 13 73 74 75 Bill Book ' ' 22' 72 Cash Book ..!,.! 7' 20 Invoice Book g' 26 Index to Ledger ,' 35 Journal 9 3J ■Ledger .....,..ll' 37 Sales Book y' 20 Appendix. Exchange 7g Averaging of Accounts .'........!..!.". 80 Interest 72 Time Table '..".' .'.'.*.'.".'.'.". .".".'.'.".'.".'.".".'.'.* " 79 •> Porms of Notes, &c ". 85 f , »■ \ ^ PREFACE. Thifa treatise, based on an experience of twenty-nine 3'ears as Book-keeper, Accountant and Auditor, and also a practical experience in the teaching of Book-keeping, is intended to enable any person of ordinary intelligence to overcome the so-called mysteries of Book-keeping by Double Entry. One Set of Books is quite sufficient to illusti-ate clearly the principles which underlie the system of Double Entry, and therefore no advantage Avould accrue from multiplying Sets of Books which must be based on the same principles. This, with the avoidance of unnecessary repeti'tion, will it is hoped by presenting the matter concisely serve to impress these principles the more tirmly on the learner's mind. The reader will find it advisable to master the preliminary rules and explanations in which all necessar}' and practical points have been fully explained. Some of the explanations on minor points may perhaps appear unnecessary, but the author wishes to make this work sufficiently complete to assist those who may take up the subject without any previous experience. Montreal, Jan., 1879. OBSERVATIONS ON BOOK-KEEPING. The practice of keeping a iccord of nccwints that reprosont value in called Book-keeping. There are only two methods of doing this work, one of which is called Single Entry, the other Double Entri/ ; the diftcrenco between the two systems lio8 chiefly or altogether in the susceptibiljty of proof of accuracy that the latter has over the former. Single Entry is (ialled by that name, because onl}'' one entry of each transaction is requii-od to be made in the Ledger, the practice being to simjily charge the person with what he receives from you, and to credit the person with what you receive from him ; consequently as such transactions con- tinually vary in substance, such as casli, notes, merchandise and the like, which usually Jiave no place in the Single ]']ntry Ledger, you can therefore never take off or produce a Trial Balance Sheet that will balance or give any proof that your posting to, and additions of the varioijs accounts in the Ledger are correct. The idea of this system being simple is a delusion, because more time and perplexing labour is required to unravel an account that has been running any length of time, than would be the case by the other system ; its simplicity is really the more puzzling in consequence of omitting proper accounts to represent the business under the usual heads of Cash, Merchandise, etc., etc. The advantages of proof of accuracy can only bo had by the Double Entry system. Therefore, Single Entry has no redeeming points to show why it should be used at all ; however, it is a lamentable fact that it is still practised by very many people who erroneously believe in its simplicity, and imagine just as erroneously that Double p]ntry is a wonderful mystery, and in consequence are afraid to look into it. Let such dispel that idea at once, and by careful investiga- tion and study of what is here explained, they will soon easily comprehend the beauties -and advantages of Double Entry. Double Entry means that every ti-ansaction must have I place on both sides of your Ledger, but in different accounts as hereafter explained. It is not so difficult of comprehension as is generally supposed j in fact it is here made quite simple and only roquiroa a little careAil reflection to bo readily un- dorstood. Most authors niyHtify tiuH nystctn by ^ivini; too many notw of Books, which makes pooplo fancy tiiat each not is dilforont from all the othorH, whoreaH the fact is positivoly clear that precisely the Hame rules (which are the only cor- rect ones when used at all) govern the whole work, and the idea of trying to illustrate every peculiarity by a separate set is quite supisrHuous for the reason just given ; however, I may hero state that Iho number of sots ])roducod are only limited to tho fancies of the author varying to suit liis ca' ice, and are not of half as much consequence as tho making ck .r every detail of tho actual governing principles of the entire system; for let it never bo forgotten that if thei'o were fifty sets of examples produced every one of them must positively be governed by the very same rules of Debtor and Creditor. This system is therefore called Double Entry because every transaction has a debit and credit significance attaching to it, which is in fact the key to the whole secret, and is ex- plained thus — to make any transaction there must of necessity be two persons concerned, one receiving, who is called debtor, end the other giving, who is called creditor, and as a consequence both should be correctly represented when making the entry in your Books. To prevent the mixing up of your whole busi- ness under your personal name in the Ledger, and in order to keep separate the various subjects that form the most pro- minent features of your business, names are given to certain accoimts to represent yourself under those properly sub- divided heads, so as to bring all the items applicable to each such account in their proper place in the Ledger, which sub- division has no real limit ; however, you may start with Cash Account, Merchandise, Bills Payable, Bills Eeceivable, Capital, Eent, Wages, Expenses, Interest, Profit and Loss, and many others in like manner. The operation or working of such accounts may be thus explained : — Say you pay Robert Gray five dollars in cash, you must charge him with the amount and credit yourself; now you have opened a Cash Ac- count to represent yourself in all cash transactions, therefore Eobert Gray is Debtor to Cash ; which in effect when posted places on the Dr. side of Eobert Gray's account $5.00, and on the Cr. side of Cash Account $5.00. Again, say that later Eob- ert Gray returns this money, as you then receive it you are his debtor for the amount, while he must get credit for it, conse- quently the entry would be Cash Dr. to Eobert Gray, because I because Cosh receives (aHyoursolf) and Robert Gray gives in this latter case. The same way of illustrating the above entry in sub- stance, applies to every transaction in your Books, but in manner hereafter referred to more fully under the heads of " Phrases," etc., and '' Books." PHRASES AND ACCOUNTS EXPLAINED. ' Dr. is an abbreviation of the word debtor, and means the person (or I'opresentative account in certain cases) who re- ceives either money, merchandise or any object of value and owes for it. The word To is used in such cases only, that is, it not onlyfoUows on that side of the Ledger account and on the Dr. side of the Cash Book, but also after Dr. in the Journal as explained in that book Cr. is an abbreviation of the word creditor, and is the reverse of debtor, or means the person (or representative account in certain cases) tcho gives, pays out or hands over either money, merchandise or other objects of value, and the word By is used in such cases only; that is, it follows on the Cr. side of the Cash Book and Ledger. Sundries is used to cover the fact that a plurality of persons or accounts are affected by the entry. The word is only used in the Journal and Ledger as shown in the Set of Books. Journalizing means the bringing together in the Journal all the accounts (in name and amount) from the Cash Book, Invoice Book and Sales Book, preparatory to taking them to the Ledger, in the following manner : Say you want to bring the accounts from the debit side of your Cash Book, the Jour- nal entry would be " Cash Dr. to Sundries," which means Cash is debtor in one sum for all that was received from the sundry persons (or accounts) who are as a consequence creditors for their respective amounts, which in the aggregate must be equal (to the fraction) on both sides ; and to bring the amounts from the Cr. side of the Cash Book, your Joui'nal entry would be " Sundries Dr. to Cash," which means that all the persons (and accounts) who received money are debtors for their respective amounts, and Cash must be credited for it. The same way of journalizing from the other Books must bo observed, when that style of journalizing is used. But such practice is now almost entirely superseded by posting direct from the books containing the original entries, which I strongly recom- mend as saving time and labour, and not being so liable to mistakes as explained under the head of Books. Posting means the taking of the dates and amounts from the vorions books, to their proper accounts and places of debit and credit in the Ledger, as explained under the head of Books. Assets mean all the values of every description that belong to a person, Including of course all open accoimts due to you in the Ledger and Bills Eeceivable on hand, also all property in which you have any interest. Liabilities mean all that a person owes of every descrip- tion, including Bills Payable and other obligations. There are three kinds generally mentioned, viz. : Secu7'ed, Direct and In- direct. The first means that the Creditor or person you owe holds security for the debt (and jDOssibly more than enough to cover his claim); all the facts in such cases should bo clearly stated. The second means all open accounts due by you, also all Bills Payable and Accepted Drafts not yd retired oi' paid by you. The last or indirect liabilities moans that you are secondarily liable for ail your endorsations on other people's notes and acceptances then unpaid by thera, and should they fail to pay, you are bound to make good the deficiency, and also for all obligations as security for others. Bills Payable mean promissory notes signed by you, and also Drafts accepted by you and given to another person or firm in lien of cash, but which you are held bound to pay at some future date. It is called payable because you must pay it when due. Bills Eeceivable mean promissory notes signed bj'' some other person or firm, or Drafts accepted by him and given to you in lieu of cash, and for which Notes or Drafts you expcQt to receive the money at maturity, hence its name. Drafts are request" to pay, and arc frequently used instead of notes, because their operations i;re more instantaneous and fticil'tate monetary truusactions materially ; when a person Draws on you, you are not obliged to accept the Draft unless you are satisfied that all is right, if you do accept it, then it must be treated as a Bill Payable. — When 3^ou Draw on an- other person und he accepts the same, you treat it as a Bill Eeceivable. See forms in Appendix. Bi/,Ls OF Exchange are really Drafts between disinterested parties such as botAvecn Banks, etc., who trade on each others credit and sell or buy Exchange according to cii"cumstances. If you want to remit funds +o England or the United States, you buy Exchange from the Bank and pay the cash for it, and remit the same to your creditor, who on presentation gets the I > 1 t' I proceeds and gives yon credit thei-efor, thus greatly facilitating the settlement of accounts. See forms in Api>endix. ■ Exchange means the value of foreign moncj-, which is regu lated by the market demand, time and circumstances. vSeo Table. Discount means the taking off a certain number of cents from the dollar, or in other words the reducing of the face value of any thing, either for the sake of settlement or for the accommodation of receiving value before maturity. Pre.miu.v" is precisely the reverse of Discouni, or is an advance on the face value of any thing. Interest. This of course is well understood to represent the value of money as to the time it is used, and consequently for accounts that run beyond the time agreed upon, it is charged or credited as the case may be. See Table. Commission is the allowance of a certain per centage made to the person buying, selling, or transacting business for another, and varies according to agreement. Consignment is the sending or delivering over of goods, money, or other property to any other person to be disposed of for the sender's beneftt. Consignments may l)0 either conditional or unconditional as to limits of prices, etc. The person who sends the goods or property is called the Consignor, and the one receiving them is the Consignee, The o-oods consigned are invariably considered to belong to the Consignor until honestly sold for his account, although they may be found in the possession of the Consignee ; of course the latter has a certain lien on the goods or proceeds thereof for his charges, etc., as per agreement. All these facts should bo fully noted wiien making the entry in the Books. Brokerage differs from commission and consignment in this way. The Broker only buys and sells on orfkrs and samples, he docs not hold the goods or values. There are a variety of Brokers, some dealing in special lines, such as Money, Stocks, Property, Grain, Merchandise, Shipping,. Insurance, etc. Accounts, such as Insurance, Kent and Fuel, Taxes, Wages, Charges and such like, are used to represent yourself or your business under these heads, and may be multiplied to suit your own views. Stock or Inventory Account is simply recommended to be used as a medium to regulate your Mei'chandise Account when you make up your Books at the end of the year, as described under the head of Profit and Loss. It is both opened and closed i i the same day, and is most convenient to refer to for the one purpose although it is not absolutely necessary. PiiopiT AND Loss Account. To this account is charged all losses as they occur only, and when you close the year's business it becomes the medium of closing the various accounts that are charges on your business, and also of crediting it with stock on hand, when the balance so ascertained will show you the Profit or Loss for the year. Of course the follow- ing accounts are not closed by Profit and Loss Account, but the balances are struck and brought down merely, viz. : Cash, Bills Payable, Bills Receivable, and Consignments. Trial Balance Sheet is the taking off on sheets of paper, or what is more pi'eferable in a special book, the balances only of every account found in the Ledger (as shown at the end of the set of Books). It is called by this name because it is the medium of trying to prove the accuracy of your Books. This work should be done very often, say monthly, and must agree to the fraction, otherwise there must be some error either in the additions or posting, etc., which should be found out at once before the account in error is settled, also, because it is much easier to correct an error of short duration than one continued for months. ^ General Balance or Statement op Affairs is a condensed form of the former, made up after the various accounts which are charges on the business have been closed (at the end of the year). This sheet is made to embrace every thing in a very few lines, by moans of classified schedules. See form at the end of set of Books. Partnership means two or more persons trading together as a Firm. Their interests may be equal or they may differ and their obligations also, but all must be according to Arti- cles of Agreement, which latter instrument should very clearly set forth all the details, and be duly executed at once. There are Active, Silent, and Limited Partners ; Active part- ners are they who personally attend to the business, and whose names appear in that of the firm ; a Silent Partner means a person whoso actual name does not appear in that of the firm, but who is just as much liable and interested as the other; a Limited Partner is one who is only liable for the amount agreed upon and settled in the Act of Partnership, which must be duly executed and registered. Be careful to register dissolution of partnership to avoid personal liability after it takes place. 6 for the one charged atl the year's ,he various )f crediting •tained will i the follow- ccount, but viz. : Cashi ts of paper, dances only t the end of 1180 it is the ooks. This must agree or either in . out at once it is much e continued a condensed rants which t the end of f thing in a See form at ng together ' may difter ng to Arti- hould very ted at onco. ictive ])art- and whoso er moans a Df the firm, the other; ho amount ship, which to register 'ter it takes AvERAOLva OP ArcouNTs is the equalizing of the time and amount of an open account ho as to debit or credit the same with interest, according to circumstances, particularly where the transactions ditfer from tho understanding between par- ties as to tho dates when payments should be made. See Tables and explanations in appendix. E. E. and E, & 0. E. arc letters only found at the bottom of accounts current, and are abbreviations moaning Errors Excepted, and Errors & Omissions Excepted. They are used solely to claim that if any mistake is subsequently discovered, tho person reserves his right to correct the same, which is an admirable provision, as none are actually proof against errors. BOOKS. The books necessary to form a complete set are Cash Book, Invoice Book, Sales Book, Journal, and Ledger ; tho Bill Book and Bank Cheque Book are important adjuncts. To these may bo added the following auxiliaiy books : Diary or Day Book, Order Books, Eeccipt Books, Eeceiving Books, Forwarding Books, Inventory or Stock Books, Balance Books, Statement Books, Letter Books and such others as fancy may dictate. As much as possible do away with the Blotter Cash Book, for its use too frequently leads to carelessness and con- fusion and takes up more time to transcribe the work into tho legular book than would bo necessary to make it there correctly in the fij-st instance. I also recommend as few books as possible to be used, so as to save trouble in case of reference to original entries. CASH BOOK. This must contain all your cash transactions of every kind and nothing else. This book might bo more properly ■called tho Cash Account, although tho latter has its proper place in the Ledger. However under tho j)i*08ent manner of keeping this book, you find on tho left hand pages Dr. meaning that Cash (which moans yourself under that head) is debtor for all moneys received and entered on inat side, and as a consequence all namesof persons or accounts found there aro croditoi'S for their respective sums; while on the other or right hand side you find Cr. which means that Cash is creditor for all amounts paid out or disposed of, and the respective persons and accounts found on such pages are debtors for their several sums. This book must bo balanced at the close of every day, and the balance brought down and cash counted at the time, so as to prove its corrccttness and detect any omissions on either cside at once, for it is much easier to detect an error of one day's standing, than it is if allowed to run several days. In posting from this book (which is uoav done to the Ledger at once instead of being journalized) great care must be ob- served in this way; say you post all your cash trjinsactions every week, do not forgot that the balances must not form any part of the amount you carry to the cash account in the Ledger ; you simply carry in one sum the entire receipts only for the week, to the Dr. side of Cash Account, and in like manner you take the total amount o^ actual payments in one sum to the credit of the same account, omitting all balances on both sides; when this is done, you should ascertain the balance of Cash Account in the Ledger, and if it agrees with that in the Cash Book it is fight, otherwise there must be some error either in posting or in the Cash Book itself which should be at once found out by checking the work done. Having clearly explained how to post to the Cash Account , L will but briefly repeat that you must at the same time post to the other respective accounts in the same Ledger, remembering always that all such accounts found on the left hand or Dr. side of the Cash Book must, be carried to their credit, (seeing that cash has already been made debtcn- as explained), and all found on the right hand, or Cr. side of the Cash Book in like manner must be carried to the debit of their respective accounts. INVOICE BOOK. In this book is entered all goods purchased or received in stock, some people however prefer to gum their invoices in a book specially prepared for that purpose You are debtor for all such goods under the head of Merchandise in the Ledger, and the several parties you purchase from are cred- itors when taken to their respective accounts in the Ledger. The posting from this book is to the Ledger direct, and should be done weekly, fortnightly or monthly at the outside, and in doing so add the whole amount of purchases for the time being, and carry the total in one sum to the debit of Merchandise account, and post to the cred.'*. of the respective parties as above indicated. tho time, issions on n crroi- of •al days. he Ledger List be ob- ansactions ■ form any he Ledger ; d\j for the laniier you the credit des; when h Account Book it is . posting or uid out by ed how to ,t you must lints in the •inns found be carried ade debtor Cr. side of he debit of received in r invoices You are handiso in n are c red- he Ledger, and should e, and in Id , ime being, erchandise parties as SALES BOOK. In this book are entered all the credit sales of Merchandise, first being particular to get the correct name in full and address of each person, and also their mark and way of forwarding and delivering tho goods, and the terms on which they are sokl. Mercliandise must get credit for all these sales because the stock has been reduced by the same amount, and as a consequence the several parties who have received or purchased the goods must be made debtors therefor. So you post direct to the Ledger as in the case of the Invoice Book, the total sales for the week, fortnight, or month, in one sum to tho credit of Merchandise, and separately to the debit of each ^M;v7<^ser the amount of his bill. Merchandise cither bought or sold for cash, as from or to parties with whom no accounts are kept in tho Ledger, must be entered 'u\ the Cash Book the same as cash sales across the counter, the entry in the Cash Book in such cases would be thus : For purchases, on the right hand or Cr. side of the Cash Book Merchandise is charged with the amotint paid, and some designating description and price should be given. And for all sales for cash the credit is put on the left hand or Dj-. side of tho Cash Book, thus Merchan- dise for cash sales this day, or for specific sales as the case may be. And if for special reasons either sales or purchases have been entered in the Sales or Invoice Books, and settled by cash, cai-e must be taken to mark tho fact in the margin of these books that they have been so settled, giving the page of the Cash Book where entered, so as to prevent posting these amounts twice to Merchandise Account. JOURNAL. This book is now only used for all entries that are neither Cash nor Merchandise, yet it is a very important book, bewauso in it arc entered transactions of the greatest con- sequence, such as Bills Paya-ble when you give them out, and Bills Receivable Avhen you get them fi-om jjarties, and also for correcting entries, for interest, for property, and in fact for recording many transactions that are not admissible into the other books as already stated. When this book is properly kept tho transactions recorded should be very fully explained (do not stint yourself about the paper) so that all the particulars will bo easily comprehended as to the intentions of parties. It used to be the practice to pass all the work from every other book through the Journal before taking it to the Ledger, which 9 was c&Wed journaU2ing ; but now to save time, labour and book room also, and to bo more convenient and accurate in transfer- ring to a loss number of books, the posting or taking of the amounts to the Ledger is done from the original entries of the Cash Book, Invoice Book, Sales Book, and Journal direct, thus requiring but one reference from the Ledger when neces- sary to do so. Kemember that the form in which the entries are made in this book is really the very essence of the system of Double Entry, as such entries at onco illustrate the fact that the double or two sides are set forth ; also that the debtor is al- ways put doum first and then comes the creditor, and afterward follow the description and explanations. Observe here that both sides are precisely equal, and if accurately posted into the Led- ger, and taken off on a balance sheet, would bo sure to agree. (It is improper to put down the creditor first in making en- tries in this book, and quite contrary to practice). Specimen entry for illustration : George Gray, Dr. $1,200 00 To Bills Payable. For my note dated Jan. 2, 1878, at 3 mos. payable at The Consolidated Bank of Canada, in Toronto, which note is to be renewed for 60 Days if I winh it, with Interest on renewal at 7 per cent. $1,200 00 Bills Eeceivablo, Dr. $1,250 00 To Sundriesy John Smith, (of Chatham, Ont.) For his note dated Jan. 10, 1878, nt 3 mos. payable at Union Bank of Lower Canada, in Montreal, given to me in full settlement of his account. Charles Graves, (of Almonte, Ont.) J'or his note dated Jan. 5, 1878, at 2 mos. payable at Merchants' Bank of Canada, in Almonte, given to me on account of purchase of land as de- scribed in Journal, fo. 76. $250 00 $1,000 00 Correction or Cross Entries through the Journal explained. It is found that your clerk has charged John Smith too much for a certain article purchased by him, and the error was not 10 and book transfer- g of the ies of the %\ direct, en neces- made in if Double that the btor is al- ifterward that both the Led- to agree, iking en- 3pecin\en M,200 00 $250 00 U,000 00 xplaincd. too much I- was not discovered until after the entry was carried to the Ledger ; consequently ho was made debtor for too much, and Merchan- dise was at the same time made creditor for too much by the same amount, therefore to correct the error you reverse the entry by making Merchandise debtor to John Smith for the amount of the eiTor. This entry is made in the Journal and when posted corrects the mistake without erasing or altering the figures. Again : suppose that George Gray agrees to assume the debt of Charles Graves by letter or otherwise, you must make the entry through the Journal thus : George Gray Dr. to Charles Graves, for amount of the hitter's account assumed by the former as per his letter of (here give date and particulars, if special conditions are attached). The eft'ect of this will be to add to George Gray's debt the same amount that Wfts at 'the debit of Charles Graves' account, and the crediting the latter with the same, makes the balance sheet again agree. LEDGER. This is the Chief Book of every man's business, being a concentration or collection of every account and ti-ansaction of value from all the other Books, and placed to their proper accounts, and it is the great final Book in which all amounts are centred. The left hand or Dr. side of every account represents what has gone out from you and to what account it is charged, and the right hand or Cr. side of every account represents what has been received by you and what account credited. These remarks are true as regards all personal accounts, but the reverHC is the case as regards Cash, Merchandise, Bills Payable, and Bills Receivable, exco]jt that they repi'osont yourself under these several heads as giving or receiving. Again let mo state that all balances found on the Dr. side of this book, after striking the balances, are in reality what these respective accounts or persons owe you, and are your assets; and the balances found on the Cr. side in like manner, represent what you owe, and are your liabilities. The Dr. side balance of Cash Account represents the cash on hand, and the Dr. side of Bills Eeccivable represents the notes you have on hand and not yet received the money for, and the Dr. side of Mei-chandise represents your stock on hand after the inventoi-y has been correctly posted, hence these three accounts truly represent part of your assets. The Cr. side (balance) of Bills Payable represents your own notes that you have not yet retired oi- ])ald, and form part of your 11 liabilities. Tho nature of all the other accounts will clearly imlicate how the}' .stand after giving Hueh full exj^lariutions. All tho posting into thiw hook is pi'oved to he correct oi" other- wise hy the Trial lialuiicc Sheet, which should bo drawn off every month or two, and so ascei'tain as often us possible that the two sides of your Ledger tally to the fraction, and if not, check over the posting and additions at once, so as to correct any error before you settle any account that may bo in error. Note. — In transferring the accounts from an old Ledger to a new one, all the accounts should be tirst balanced and a correct and proved Trial Balance Sheet made out, then transfer all the balances as they appear in the old book, in the same order to the new one. Should you not bring them all into tho now Ijedger, you should in that case be sweto make the transfers through the medium of the Journal, and open an account for that purpose in the new Ijedger, and call it Old Ledger or Ledger A or B account as the case may be, as follows : say Old Ledger, (or Ledger A or B) Dr. To Sundries. Here give the names (on separate lines) and the amounts or bulances of all the accounts that you bring from the old Ijedger, and are found on its Cr. side ; and for the other side, say : Sundries Dr. To Old Ledger, (or Ledger A or B). Here in like manner give the names, etc., that you bring forward from the Dr. side of the old Ledger. By following above directions, you at once comply with the correct principles of double entry, and the accounts and bal- ances in the new Lodger will thus be correctly represented on both sides and must acrree. III! BILL BOOK. In this hook are entered at once on the Bills Payable side, all notes and acceptances you may sign, before they lea.ve your office ; they should also at the same moment bo entered in tho Journal giving all the details which may be of the greatest imjwrtanco in case of disputes and points of law, should such ui'ise ; be particular as to the date you put at the head, tho time it has to run, where payable, when duo, the person to whom 12 clearly nntions. r ot hcr- jiwii off blc that , and if bo as to may be gor to a , correct isfer uU [ic order into the transfers ibr that • Ledger ounts or the old her iside, L or B). )u bring with the and bal- snted on \h\o. side, lye 5'our ed in the greatest )iild such the time to whom given and the account for which granted, the amount, and uny special conditions. Such books are generally printed in form hy the stationers and prepared for Bills Payable at one end, and Bills Receivable at the other end; there is generally a margin for remarks on the right hand side of the page, in which some people show how the notes have been disposed of. All Bills Ilcceivahle are entered precisely in the same way as above, but at the other end of the Bill Book. Note. — In largo firms I would recommend that the Bill Book be specially made, having one month only on each page ; (there may be several pages for each month), this idea will at once recommend itself on a little careful consideration. BANK CHEQUE BOOK. Every person doing Banking business should always keep a book of this kind, and never sign a cheque except in his own book so as to have a marginal transcript of what he actually does in this respect, that a correct entry may bo made in his Cash Book. See example which follows Bill Book. Note. — It will be observed in the example that the Bank ac- count is kept in the Cheque Book, which saves a multitude of entries in the Cash Book and Ledger. The auxiliary Books speak for themselves by their designations and as they do not form any actual part of a set of books, I will pass them over. RULES. 1. Take time to consider well wh;r you are about to do before making an entry and so avoid mistakes. A Book- keeper should never be hurried too much, as he may be cautiously studying his work. 2. The nature of the entry to be made will at once indicate what book to use. All cash must be represented in the Cash Book, all goods or merchandise coming in, in the Invoice Book, and all goods or merchandise going out in the Sales Book. Every other description of transaction must be entered in the Journal, and should be very clearly stated. 3. Be sure you are right as to who or what is debtor, and the nature of the transaction will at once show who or what is creditor. 4. Remember always that the names of certain accounts in 13 I !!!! !!i lilii yonr Tiod^or arc used to roproRont yourself or business under their special hejwlH. 5. All entries, especially those in the Journal, should be made as nearly as possible in the language of tiio bargain or understanding of the transaction. Never bo afraid to use extra lines for this purpose, because if disputes arise and recourse to law becomes necessary, the clearer the entrio..* are made, the easier will it be to pi'ove your case before the courts. 6. In order to be most accurate in making your entries when they are unusual, you had better first write and shape them on scraps of paper, and carefully study them in that shape and make them perfectly correct before you enter them in your books. By this means you will avoid many trouble- some corrections. 7. Eemember that it is quite as impossible to make only one posting to the Ledger and have that book balance as it would be to put a weight on one side of a scale and have it bal- ance. Therefore all posting to the Ledger must be to two or more accoujits, but always aggregating the same amounts on both the debit and credit sides, that is, the debit of one account must be a credit of another. So the debit of many accounts may be the credit of only one, and the debit of one may be the credit of many, as already explained under the head of posting, as iri the case of sundries. 8. Cleanliness and uniformity of style in making entries should be strictly observed in every book, also in the wi'iting. And avoid erasures, because such a mode of correcting mistakes very frequently throws doubt on the minds of third parties as to the correctness of the original entry. Better far to make the correction through the Journal as explaired. 9. In drawing off a Trial Balance Sheet you only put down the balances of each account as you find them in the Ledger, and the two sides must agree to the fraction, otherwise search for the error, first in the additions and subtractions of the Ledger and the bringing of the correct balances to your trial balance sheet, and if the ei*ror is not found there, then check your postings from the various books, and be particular in the totals of your merchandise from Invoice and Sale Books, and Cash Book, etc., for the error must be found. 10. Eemember, — I again repeat it, — that the whole secret of Book-keeping by Double Entry lies in the fact that every cent that finds its way into the Ledger on one side must have its equivalent on the other side, but most assuredly not in the 14 lid bo Bamo account. It is really as already stated, viz. : two parties must l>o roprosontod in every tnmsaction, one receiving who is debtor, tlu) other ^ivint^ who is creditor. One may bo reprosentod by hi« individual name, the other by Mome name used instead of his own to represent his business under such name. By a strict observance of these rules you are quite able to keep books by Double Entry. Note. — Merchants vary in the style of getting up and •keeping their Books, according to their own peculiar notions, yet the same principles govern every pcculiui'ity of Books in use. Even those of Banks and Joint Stock Companies, if kept on the principles of Double Entry, must be governed by Debtor and Creditor. The set of Books heroin produced for illustration is adapted to a grocer's business. The reader or student can change the names of persons, Mccounts and trade to suit his own actual or intended business, be that what it may, and the result of his work will be precisely the same if all the rules are observed. entries QUESTIONS AND ANSWERS. Question. — In commencing business what is the first step to take with regard to your Books ? Answer. — When I start in business by myself (that is with- out a partner), I write down on a sheet of paper all the parti- culars as to what my capital is composed of, how it is situated, and noting very minutely what claims if any there may be against me, and also what may be duo to me, and having cor- rected and satisfied myself that such memorandum is correct, I then should take up my Journal and make a clear and full declaration of all the facts in that book as an explanatory note only, as being the basis for further entries, (see Journal entry in set of books hereto.) After this statement is correctly made, I then proceed to make the actual financial entries in my books according to facts. If I have cash, I make that entry in the Cash Book thus on Dr. side I state : To Capital Account I'or this amount belonging to me and put into my business this day, (see Journal memo.) And for everything else, such as Bills Eeceivable, Property, Debts due to me, or Merchandise, I make the entry solely in the Journal, (see Journal memo.) Note. — Some people may prefer to make the statement in their Ledger or some other book, while others prefer to make no such statement at all. But I strongly recommend the 15 I I wloption of tlio plan Ium-o proponod iw boitjg mfwt sutinfactory un(U^i' all cii'ciiinHtanros. Qui'.sfioit. — What would ho tho nocoswiry ontrioH to inalvi> in COHO of I'artnorshij) busiiioHH ? Ansirer. — li' I coinnionco with ono or more PnrtiierH, tlu* firHt Hjop to tako is to have flu' ()rti(:les of co-partnership most carefully drawn uj) nottin/^ forth all tho facts of agrconuMit and the CH])ital of each fully descrihed, tho interest and duties of each as tho case may be, and when duly signed, J then make the financial memo, in tho Journal in accordanco with tho answer above noted. And then T proceed as in my own case first noted, except in this pai-tieular that each ])arlnor must have his caj)ital account separately entered. Thus after making the general memo, if there is cash put into the business by any or each of the Partners it must appear in the Cash Book in this way : On Dr. side. To Charles Smith — Capital Account — For this amount put into tho business this day. (See Journal memo.) To Arthur Black — Capital Account — For this amount put into the business this day. * (See Jouriud memo.) To Daniel Collins — Capital Account — For this amount put into the business this day. (See Journal memo.) And for everything else put into the business by the res- pective partners the entries will appear in the Journal thus: — Sundries, Dr. To Charles Smith, Capital Account. Bills Receivable. For (J\£re insert the list of Notes fully described that he may put in.) Eeal Estate. For (here give particulars in every respect.) (Open Accounts') or debts due to Charles Smith, here give names and particulars of each party whose name will appear as debtor in tho Ledger. Each on separate lines. Sundries, Dr. To Arthur Black, Capital Account. Bank Stock Account. For shares of Bank Stock put into the business this xgi day at memo.) l^er share as per agreement. (See Journal 16 :^li Moi'chandise Account. For mTiomit of Stock on hand per Inventory iin per nt?re«- ment, put into the buwinoHH this day. (Seo .lournul memo.) vSundriea, Dr. To Daniel Collins, Capital Account. Bills Roccivablo. For (here insert names, &c., us above). Charges Account. Ifor " Dray Horses, Harness, Waggons, &c." Note. — The reader of course will comprehend at a glance that these illustrations are merely to show how each partner's capital should bo entered up. Question. — Having miado the necessary entries at the begin- ing of the business, and having (sontinued the operations for some time, how is the ca])ital now roproHented ? Ansxoer. — What then represented the ca])ital became merged in the general business and must now form part of the assets, as most likely several, if not all, the items that formed such capital may be changed. So in the balance sheet the Assets and Liabilities did then agree and do now agree, the capital always forming part of the Liabilities, as also what was put into the business formed part of the Assets. The same is still the case. Question. — Should you be obliged to suffer loss through the failure of a person who owes you, and he makes a final settle- ment with his creditors, say at 20cts. on the dollar, what entry would you make ? Answer. — If I am obliged to accept his terms of settlement, when he pays the amount in cash he is duly credited with the same, and when the final payment is made I then make a Jour- nal entry thus : Profit and Loss Dr. to (here give debtor's name, etc.), for loss ai-ising out of his failure, as settled by his creditors at — cts on the dollar, ; this amount to balance his account. Such an entry is only made when there is no chance of further collections from the debtor. Question. — If you purchase goods in a foreign market where the currency differs from your own, how do you make the entry ? Answer. — I must enter the goods, &c., in the Invoice Book iH the usual way, but adding all charges and duties and the 17 tht-n current rate ot exchange so as to bring all to our own currency, in order to post it in that way to the Ledger. This should always bo done at once and so save the trouble of con- tinually being obliged lo reduce the amount to our currency. If no rate of exchange is fixed at the time, I take the recog- nized par of exchange as my guide. Queotion. — How do you find out what profits or losses you have made in your business ? Answer. — I must first take an Inventory or Account of Stock on hand, and then make this Journal entry, viz. : Stock Account Dr. to Merchandise. — P'or amount of Stock on hand thib day as per Inventory Book. When these are posted to the Ledger it makes Stock Account represent the Merchandise on hand, and the Merchandise Account is then balanced by carrying the difference of that account to Profit and Loss ; I then proceed to make all the necessary charges to the several Expense Accounts up to the date of making up the Books, and then balance all such Accounts as are charges on the business through Profit and Loss Account. (See illustrations at closing a Set of Books.) Then the balance of Profit and Loss Account if on the Credit side will show the profits, and if on the Debit side will show the losses. This of course is merely as far as such results can be ascertained as regards the Morchaiidise transactions and expenses, still leaving the uncertainties as to the Personal and Bills Receivable Accounts, &c., and the value of Peal Estate and Securities on hand if any there be. After all the above work is done, I then make Merchandise Dr. to Stock Account, for amount transferred. I do this so as to have Merchandise correctly represented with the net amount of Stock on hand at the time, as if it were an actual new purchase, and by this means I close up Stock Account. The Header or Student shoidd fancy himself a merchant, and to practically illustrate his study of this icork, get Quire Books ruled for the purpose, and change the names of persons and good?, to suit his own vieivs. 18 SET OF BOOKS BY DOUBLE ENTRY. iii M nil (1) Dr. 1878 Juii. 1 12 12 14 Cash. To Capital Account, For this amount which 1 put into my business this day, as per memo in Jomnal, R7it./n. 2 To balance brought down. " Merchandise Account, Received for 5 bhls. Flour sold for cash (d) $5 00, " Merchandise Accounl, Received cash sales this day, Ent.fo. 2 To balance brought down. " Merchandise Account, Received for cash sales this day, " Interest & Discount Account, Received Discount from J. Tiffin & Co., 5 p.c. on $797 50, " Merchandise Account, Received for cash sales this day, Knt./o. 2 15 To hal. brought doini and forvard. 25 80 96 00 00 25 39 87 05 00 Cash [Jan, S5000 00 $5000 $4653 00 50 105 00 S4758 $4593 50 50 !01 $4704 12 $1334 72 /5^6* See Note on opposite page. 20 00 00 50 00 50 50 12 72 Book. 1878.] (1) Contra. Cr, Jan. 7 2 By Office Expenses, Paid for Safe, $200 00 " " Stationery, 7 50 " « Furniture, &c., 75 00 " " Fuel, 30 00 312 3 50 00 11 " Postage Account, Paid for Stamps for Circulars, &c. 8 II " Charges Account, Paidcrt'geon320bbls.Flourra)5c It; 00 'd i< " Insurance Account, 3 Paid Royal Ins. Co. on stock of $6000, 12 mos. to Jan. 2, 18T9. Balance carried down Ent.fo. 2 15 00 316 4653 50 50 5000 00 8 By Charges Account, Paid for Horse, Sleigh, Harness k Robes 135 00 13 7 " Wages Account, Paid G.Greene, storeman, 1 week 5 00 16 II " A.B.C. (My Personal Ac'ct.) Paid Self ifor House Expenses, Balance carried down 25 00 1G5 45!)3 00 50 8 Ent.fo. 2 eiTos 50 8 By Charges Account, Paid Cartage on 200 bbls. Fisli, (TifHn's) fu> 5c. 10 00 15 10 " Ontario Bank Stock Account, Paid for 25 Shares fa) 103 p.c. net, (This to facilitate discounts when required.) 2575 00 19 12 '• Joseph Tiffin & Co., Paid tlieir hill of 2nd inst., less 5 p.c. for cnsli. See discount oa opposite side, $39.87, 797 50 3 14 '• Mort liandiso Account, Paid for 10 tuba Butter bought on Market, net weigiit4301bs f(i 18c Balance carried doirn Knt.fo. 2 77 40 8459 1334 90 72 «4794 62 NoTK.— U'lien roKuliir open iiccDiiiits urn ,«'ttle }V^ Cash Dr. Cash. [Feb., Feb. 28 Mar. 17 12 April 29 May 11 15 25 To Balance brought forward. (NoTK — Having given regular speci- mens for daily balancing this book, and for weekly posting, I will now skip through several months to illustrate further opera- tions.) To W. Smith & Co., Tofonto, Rec'd from them £250 Stg Ex on London at 8i p. c. $1203. P5 Cash for bal. Bill 5th Jan. 134.45 '• Arthur Preston, Montreal, Received from him on account. " Interest & Discount Acc't, Rec'd from A.Preston Int.on above from Jan. 1, 1878, /® 7 p.c. " Joseph Wilson, Cobourg, deceived from him amount of his purchase of 6th January. Ent.fo. 2.' To Balance brought down. 24 1340 500 985 $2586 24 00 00 05 00 2833 05 $5419 29 1380 54 Feb. 21 Mar. 14 April 10 13 31 32 26 30 (f << By R. Eefoi'd & Co., Montreal, Paid them £2.50 Stg. Ex. on London at 9J p. c, purchased from W. Smith & Co. Exchange Account, Paid for £400 Stg. on Lon- don at 8 J p.c. Rent Account, Paid Rent of Store from 1st Jan., 1878, as per lease at $2,000~4 mos. to 1st May. Wages Account, Paid George Greene, 13 weeks in full to date (iJb $5.00. Francis Chisholm (clerk). Paid him for services to let May. Robert Bridire. Paid him for services to Ist May. Balance carried doivn Ent.fo. 2 1216 1924 666 65 108 51 66 44 66 00 33 %\ 4032 75 1386 54 $5419 29 25 I I (1) Invoice Book. Montreal, Januari/, 1S78. o - » Bought of JH D. Toi-ninee & Co., Mojitrewl. Terms, 3 mos. — 150 bbls. Sup. Flour fa> 1.50 675 00 100 " Fancy '• 4.75 475 00 70 " Sup. Ex. « o 5.00 350 00 $1500 00 4 19 Joseph Tiffin & Co., Montreal. Terms, 4 mos. — 50 bbls. Mackerel N(x 1 5.00 250 00 100 " Herring, No. 1 3.85 385 00 50 '■ do. No. 2 3.25 i<;2 50 7!)7 50 /* 20 Kin^an & Kinloeh, Montreal. Terms, G mos. 100 cases Gin (Green) 5.00 51 ;o 00 100 " (Red) ,9 8.50 850 00 1350 00 21 R. Reford & Co., Montreal. Terms, 4 mos. — 25 cliosts Young Hyson Ten, net weight 1500 lbs. (avera^re ' 60 lbs. each) /??) 50c. 750 00 10 chests ^ouchong E.xtra, net weight 600 lbs. (av. 60 Ibe. ea.) 00c. 300 00 5 bags Java Coffee net weight 360 lbs. 4 25c. no 00 1200 00 22 A. Urquhart & Co., Montreal. Terms, 5 mos. — • 250 boxes Layer Raisins .^.00 ! 750 00 250 half boxes Laver Raisins 1. 00 400 00 .50 drums Fig.s, say, 1000 lbs. ril 4c. •10 00 40 doz. Ass'd. Pickles •1.50 00 00 1250 00 23 Gillespie, Moffatt & Co., Montreal. Terms. 3 mos. — • 300 bbls. Green Cod Fish 2.50 750 00 200 " Labrador Herrings, No 1 4.50 000 00 600 bags L. Salt Note.— Of c""" -, above entries are imag- 1.00 000 00 2250 00 inary and luiide witliout invoices, simply lor illustration. Forward $8347 50 26 20 22 18 Invoice Book. Montreal, Jdriunrij, 1S7S. (•) Amoxmt brought forward. 12 Iviiigan & Kinlocli, Montreal. Terms, U mon. — 50 cases Martol's Brandy 50 " Hfiu'BBoy's pts. Brandy 2 doz. per case. 100 cases Claret, St. Juiieii IS R. Eeford & Co., Montreal, Terms, 4 mos. — 25 Chests Japan Tea, net weight, say, ITjOO lbs /© 25 bags Mocha Cotiee, net weight, 1800 lbs. 13 A. Urquhart & Co., Montreal. Terms, 5 mos. — 5 casks Currants, 700 lbs. 20 bags Rice, 3000 lbs. 2 casks Mustard, 70 jars, 4 lbs. each, equal to 280 lbs. 5 bags Blk. Pepper, 750 lbs. 14 - D. Torrance & Co., Montreal*. Terms, 3 mos. — 10 casks Sal Soda. VnitH. Qrn, Lbs. Wt., 5 5 6 5 6 7 C 6 7 11 Tare 1 19 3 24 2 5 12 1 22 3 20 20 Cwt». Qra. Lhs. 7 11 20 14 9 18 I 8.00 9.00 2.00 1 1 3 03 3 2 6 12 2 16 2 6 2 13 2 10 12 Net 57 18 or 64.'i8 lbs. Knt. L.J'o. 3. 27~ 40o. 28c. 5c. 4c. 10c. ■6c. 3c. 400 450 200 (100 504 .•^5 120 28 45 00 00 00 00 00 00 00 00 00 $8:347 50 1050 1104 228 193 00 00 00 74 1109231 ::4 (•) •n 24 18 20 21 Invoice Book. Montreal, Febnvanj, 187 8, A. Urquhart & Co., Montrcul. Terms, 5 nios. — 10 cases Indigo (Bine) net OOd lbs rd) 20 cases Glenfleld Starch, GOO lbs. _ 10 CrosHG & Blackwoll, London, England. Terms, Cash. Por S.S. Sarmatian from Liverpool D casks Ass'd. Picliles, 1 2 doz. ea., say, 60 doz., at 3s. 8tg. X9 0. 5 cases Assd. Jams, 20 20 do/,, pots each, say, 100 doz.. at 4s. stg. £20 £29 Freight to L'pool fj Whrfgo, 2s. ; Ins., .Os.ed. 7 6 Freight to Montreal 1 7 6 £:w n ^ or = $122 20 1 20 48 15c 8c. Exchange at 9^ p.c. D. Tori-ance & Co., Montfoal. Terms, 3 mos. — 50 bbls. Ex. Family Flour fa) 50 " Fancy do 2J Kingan & Kinloch, JVlontreal. Terms, 6 mos. — 5 hhds. Molasses, 120 galls, ea., say, 600 galls. ^ 26 -— 4.75 4.30 60c. E. Reford & Co., Montreal. Terms, 4 mos. — 10 ch'ts Twankav Tea, net \vt. GOO lbs. 5 " (Hyson Tw'kay) 10 bags Brazil Niit.s 10 do Almonds 10 do Walnuts " 300 " •• GOO '' GOO " " 500 •■ i:?i(. L./o. 3 40c. 35c. 9c. 10c. 8c. no 48 00 00 215 240 105 54 00 40 50 00 00 00 00 00 00 $138 00 148 08 452 50 360 00 499 $ 1598 00 T8" •See E.^chanKti in Appendix. 28 Sales Book. Montreal, Jaiuuiry, 1878. (I) ; i Q 1 1 »» ■ - ' ■ r c' 25 Potor (Murko, (^nol)cc. Q Terma^ 3 moa.— via (i. T. U. 50 bblH. Sup. Flour, 4 . 80 240 00 5 " " Extra Flour, 5 . 30 26 50 5 chcHts Young Hyson Tea, 300 IbH, fiOc. ISO 00 1 bag.hiva ColTw, '72 llis., 30e. 21 60 4(!H 10 A M D 26 »i Alox. McDonald, Cornwall. C Terms, 3 mos. — via G. T. R. 10 bbls. Jrac kerel, No. 1. 10 " Ilorrings, No. 1, S.fjO 4.50 55 45 00 00 5 cases Gin, (green) 6,00 30 00 6 " " (red) f 10.00 50 00 180 00 •* .1 M 27 JaTne.s Murray ,Prcscott. P Terms, 3mos. — via G. T. R. 25 bbls. Herring, No. 2, 4.00 100 00 10 " IMackeroI, No. 1, 5 oh'ts Young Hyson, :{(l() lbs 1 " Souchongnxtra, fiO lbs 5.50 60('. 70(-'. 55 180 42 00 00 00 1 bag Java Coffee, 72 lbs.. 30c. 21 50 398 60 WSC 28 VVni, Smith & Co., Toronto. T Terms, 3 7?jo«.— via G. T. R. 100 boxes Layer Raisins, 3.50 350 00 100 half boxes Layer Raisins, 1.90 190 00 100 bbls. Labd. Herrings, No. 1, 5 . 00 500 00 ■ 200 bags Lpl. Salt, 1.50 300 00 13-40 00 f> JW 29 Joseph Wilson, Cobourijc. C Terms, 3 moa. — via G. T. R. 50 cases Gin, (green) 6 . 00 300 00 50 " " (red) 9.50 475 00 ,5 chests Souchong, (extra) 300 lbs, 70c. 210 00 985 00 GPC 30 4 ■ ■■- - G. Pringlc & Co., Toronto. T Terms, 3 mos. — via G. T. R. 200 bags Lpl. Salt, 20 doz. Pickles, 1.50 2.00 I 300 40 en 00 340 00 Fo7'ward. 1 S3711 70 29 («) Sales Book. Montreal, January , 1S7S. /y / Amount broiKjht fortrnnU !i^37II 70 r f: 25 (Vtor (Harkc^, Quoboc. <^ Terinx, 'A mo». — via Q.'Y. R. no bblB. Fancy FloAr, 5 . 00 250 00 i ch'HtSoiirhdiiKt'xtrH (iO Mm 70c. 12 00 10 boxoH Liiv(!i- Kaisiim, 3 . (iO 31) 00 10 Drums Figs, 200 Mw., 7c. \\ 00 342 00 .F VV 29 ■ — ' ■■ ■■ tf Joseph WilHon, Colxmig. c Ternm, 3 ;no«.— via G. T. R. 20 ItuxoH Layer RiiiHiiiH, .-} . 50 70 00 2i» lialf hoxvM Lay>T RaJHiiiH, 1.00 3S 00 10 Unitns Figs, 200 lbs., 7c. 14 00 122 00 •1 M li7 .lanioH Mui-ray, rrcsc^ott. r Tertm 3 wo«.— via G. T. R. 10 lbs. llorrings, No. 2. 4.00 40 00 25 bags Lpl. Salt, 1.50 • > 1 50 25 bbls. Green Cod fisli, 3.00 75 00 152 50 P C 30 T (J. Prin^do & Co., Toronto. rermn, 3 7nos.— via G. T. R. -10 bbls. Green Cod fish, 3.00 120 00 20 " Labd. Herrings. 5.00 100 00 10 coses Martel's Brandy, •t.oo !I0 00 20 " Claret (St. .lulien), 11 2.50 50 on 3(;o 00 WSC 28 T Wm. Smith & C(x, Toronto. Termsy 3 »«os.— via G. T. R. 3 casks Sal. Soda, Ca-t. urn. UiH. Cwt. qrt. Ihn. .5 1 Tare, 2 7 6 1 19 2 20 .5 3 24 2 14 17 2 15 1 3 13 1 Tare, 1 3 13 5c. 1 88 ^4770 15 3 2 or, 17«« lbs. 30 £ni. L. /ol. 3. 50 1 30 Journal. Montredh Janiuiry, hS7fi. (i> •> 4 — — — — Mi'ino. I coniiiK'tict-d liiiHincKK this 0.00 For William Cook, Note due Feb. .lid, dated Oct. 31, 1877 at 3 nios 500.00 Arthur Prkston, (Montreal). For this amount due by him, an old ba- lance on sale of old Stock of Merchan- dise. 8000 2r)00 1500 00 00 00 7000 00 Memo. • 1 rented Store No. 76 McGill Street from Ilarison Stephens as per lease passed before G. R. W. Kittson N. P. Terms $2000.00 and Taxes per annum rent to run for 3 years from 1st May next, — pay- able every 3 mos, he is bound to do all repairs, and make the alterations neces- sary within ten days and to keep the premises in perfect order, I get [losses- sion to-day at above rate to 1st May. 31 ! »; ';!;• 11 (?) Momo. 4 21 20 23 22 Journal. Montreal, January, 1878. 2 I engaged F'rancis Chisholm as Clerk at the rate of $400.00 per annunj from this date. Also Robert Bridge as junior Clerk at the rate of $200.00 per annum from this date. Also George Greene as Storeman at the rate of $5.00 per week, subject to dismissal by giving one week's notice. t2 Sundries Dr. To i3ills Payable. Duvicl Torrance & Co . For my note at 3 mos. from this date for bill of Flour purchased on 2nd Inst, payable at Bank of Montreal here. . . . Eobert Eeford & Co. For my note at 4 mos. from this date for bill of Tea purchased on 3rd instant, payable at Bank of Montreal here Iviiigiin & Kinlocb. for my note at B mos. from this date for their bill of sundries purchased on 2nd iust. payable at Bank of Montreal here Gillespie, Moffatt k Co. For my note at 3 mos. from this date for bill of purchase of Cargo of Fish and Salt on 5th inst., payable at Bank of Montreal here Alexander Urquhart & Co. For my note iit 5 mos. from this date for their bill of East India produce dated 4th inst., payable nt Bnnk of Montreal heri^ 32 7550 00 1500 00 1200 00 1350 00 2250 00 i2r)0 00 00 Journal. Montreal, January, 1H7S. (3) 7t5 6 Bills Receivable, Dr. 551 1!) 27 To Jamos MuiTay, Prcscott. For his note (cb 3 months, dated 6th January and payable at Ontario Bank here — to bo renewed for half amount, he paying Bank rate of discount and charges. 551 10 5 Bills Receivable, Dr. 3-iO 30 To Geoi'go Prin^lc k Co. For his note ^ 3 months, date January 7, 1878, payable at Bank of Toronto. En- 3.40 00 dorsed by W. Smith & Go. April 16. 28 Wm. Smith & Co., Toronto, Dv. ' 3b'0 00 3) To Goorge Pringlo & Co. For amount of latter's account for purrlia,so of January 1 2th, assumed by former as ])er 360 00 his letter of 15th instant. Note. The following ijntries arc given to show how to close the Books at the md of the year, to ascertain if any profits have been made — I do not post them to the Ledger— But the General Balance Sheet is made up as if they were posted ; this will give the reader or student a little iiractini iu such work that may be of advantage to him. 'faniiary 2iid, tS7U. 1 Stock Account, Br. 10802 50 To Mefchautliise Acroimi. For amount of Stock on hand as on this day 10862 50 l)er Inventory Book No. 1 . 38 II ill 11 li i ; I (4) Journal. MontrettI, Jannaiij, 1879. Merchandise Account, Dr. To Profit and Loss Aocount. P'or baliincu of account transferred, being apparent advance on goods sold dur- ing the year 1878. Wages Account, Dr. To Sundrios. Francis Chisholm. For 12 months salary as clerk. Robert Bridge, For 12 months salary as c. k. 3942 93 600 Profit and Loss Account, Dr. To Sundries. Office Expenses. For amoimt of account transferred. (The safe is valued in stock.) Charges Account. For amount of account transferred. (Horse, &c., valued in slock.) Insurance Account. For amount of account transferred. Eent Account. For amount of account transferred, 12 months. Postage Account. P'or amount of account transferred. Wages Account. For amount of account tranhiferred. 3264 00 35 Interest and Discount Account, Dr. To Profit and Loss Account, For balance of account transferred. 109 43 3042 93 400 200 00 00 312 248 15 200 3 685 109 50 85 00 00 00 00 43 U Index to JLedger 03 00 00 50 POLIO A. B. C. (my personal account) 16 B iBills Payable Account Bills Eeceivable - Bridge, Kobert - Capital Account - Cash Account Charges Account - Crosse & Blackwell Clarke, Peter Chisholm, Francis 4 5 32 1 2 8 24 25 31 H I Insurance xVccount Interest and Discount D Discount (See Int., &c.) - 12 K Kingan k Kinloch Exchange Account - - 14 Gillespie, Moffatt & Co. 23 M Merchandise Account Murray, James Mc McDonakl, Alexander 35 FOLIO 9 12 20 3 2t )i6 n^ I Index to Ledger— continued. N KOI-IO T Torrance & Co., David - Tiffin & Co., Joseph - FOLIO - 18 IS U Urquhart & Co., Alex. - O Office Expenses Ontario Bank Stock - - 7 15 - 22 V P Postage Account - Property Account Preston, Arthur - Pringle & Co.. George Profit and Loss Account - 11 6 - - 17 30 - 3'6 Wages Account - Wilson, Joseph 13 - 29 Q X R Rent Account - Reford & Co., Robert - 10 - 21 Y Z S Smith & Co., William 28 36 '^f o o o O c o o o c o o o c (^ o c o o o X- •o rH - 1—* It X 1) ■5 ^ § .^ CC o >> ^ : M M M 00 1- a 00 « *• ^ t-j -- - 1 1 - • ■ . 87 ei 00 o O t— -f » —* »o r— t -i< CO (M J3 ■■a (f) 1 w 1 •* ■* 00 _ 1— 4 »— ( »-H CO •^ 00 CO •o CO CI 00 00 >~, o t 00 CI 1^ ■* c^ '""' 00 J>-5 1- CO 00 00 C5 l'- o I-H 05 - I-H Oi C-l r—i -^ M Q « M w -< >. , ^ CQ n ""^ 00 1- C .- 00 rt "* * ■* -1 ^ — n posting to this account, should be entered on . , ines in every case, and set amount opposite the to facilitate checking. >H c — T3 . 1.0,,-SS U C-" aeS ft gc* ■ * i^Sg-f O V l« ? 40 c o o <: 3 > o (II OQ Ik O ' O - O lO M 1—4 «» M »- J, C 41 c ? 5-s 1 to this ac entered o case and posite tht 'cking. o ^^.H Q , -In poRti e should nes in ev amount acilitate K M ^ (S c3 ee oa V aaa M C^ 00 X - af © o o O o f^ * 1 o o t— 4 o '~* o o o i-H o lO in o >n -t -t M 1- in m M »— 1 C^l ^ ^ -^ - - 01 ^5 o o ^ C5 O o Q -K i^ *^ r* »» \ o •M O •« ^ ^ m 3 - 9 ^ t 1-5 fin <>^ SP o o V H ' ^ ~J oi - -' 00 00 1 = - :; J P^ 41 o o CO o (X 00 >. 47 ^ o o o Q »- © U3 fO M oc c ■<^ o o ■>f o> a ,^ oc f- Oi CO IT o i-H -> IM C^l m « o . d J3 ^ X >^ PQ CQ (M in 00 lO .— ( •"' C-l N (M , ^ 00 "a ., O ?? 1-5 k— ( ""^ _ a <\ ^-^ 0^ fo (M -t o • 00 (35 ^- C<1 S8 \ ^ o \ o 03 \ H \ ic c^ 00 t>^ 1— 00 1— 1 1 48 m a 6 c :i o o o < If) o ' . 1 1 ■■^^■^HH C o """ '~' O *..- '"' ** 1* o ITS >ra 1 i-H O 00 ■ r-4 e^ M m .a S 'i o ::; ;j s • o H 1- O 00 o M CO 1878 Jan'y. 3 2 1 < i 40 o o (1) OB Xi o X W ^ ■a I o M 00 ^ t- t: 00 09 ^"^ s .•^o o o CB CO u O PQ f* — — — « ■ ' o o 1 o o 1 ! •n o N lO 1 ^ •^ w \ Jl 3 4 o o H i— 1- 00 1 a - 62 e o o © © © o 1.1 Ifl CO <0 U ■(J =5 y — IM U Oh 00 rt © © © © (0 K. 3 O <1 5 as O O 00 ^■ 00 * 53 e a U o > Q Ik o r)l o o 1— ■" o CO M 13 CV O ta r— » •^ »-H ¥> «* *-* O m • 4) .a "O ^j ^ ^ u hi o »-^ <; >> • » o CO 00 d ^* 00 1-5 o -t o 1>- o co o C5 1.-5 f— 1 —4 «^* N N » a< ^ « >> gS Pm CO to :e (=1 o O 1 Eh e^ m 1 r-i i>j 00 d t 1 CO si l-H 1-5 5i es Si c o o u s (0 O •-3 o >» .2 V p 1- c 00 rt I— I "^ I I- o 1- (0 S§- o 00 1- 00 c e! 55 I e cS (1) O o o s 14 © o ■3 O o o o o o in to to fO o M CH «f> A 9 . "^ N eo 4J ■ 00 TJ a 53 J3 *i ^ O <1^ ^ * t>^ pq •M r-i • CO s -• I-H I-: f^ o O ' o o 1 o ^^ in 1"^ , CO ^3 »— 1 ^ tf> N CI ■ if eS 00 s O Eh • » C^l lO ^~* IM 00 a 00 4 56 w^ u •p o O c2 u Si o 0^ o o o o •*• e o o o M • © f OJ M «> o o Oi o 00 M r^ t o CO r-t l-H Ui w *-^ CI M * ttT .2 •3 , 01 «, A ^ ,.! o u fl (H OS 4J S 1 >. >< n PQ CO fO CO (M - 00 00 r— ( : OS r^ « -t o o 1* ■^ CO o ■ y— ', o o CO o »— t 00 <= - CI (M CO CD r-H w • ^ p-H M 4> u a c8 ^ PQ a> CH ,a c8 >. r! P^ CO ^ ^ 'Ji M O o H C-J 'XI .— ( O O 00 00 c M u X 0) o in IM 00 IM (M I i? -a n o o Eh e^ 00 00 ^- 00 s 1-5 58 s e o •a M 4* CO u ♦J o Si O o . K in 00 o c-i GJ c o 00 • J- c 64 ^ o o h o O S Q O 0) o O o o © c -t" to CO M t^ fO CO V ,0 5 • M 4) O c/> o 00 7 Otticc KxpeiiHes " 312 50 8 Char^'os " 248 85 y [iisuraiicu '* 15 00 10 Rent " (I'b'fJ ()(; u Posta<^c " :! 00 12 Interest antl T)isPount Account '■ 109 43 1.'} Wa/^os '• 85 00 1^ Kxchaiii^o " 1,924 44 15 Ontario IJanU Stock " 2,575 00 10 A. B. C. (my own account). 75 00 17 Arthur Preston. 500 00 18 David Torrance & Co. 452 50 19 Joseph TifHn & Co. ... ... 20 Kin^-an & Kinloch. 360 00 21 Robert Rcfoi-. Torrance & Co. $r5oo ' 00 R. Re ford & Co. 1200 00 Kingan & Kinloch. la'jo 1 ,00 tiillespie, Moffatt&Co. 2250 00 Alex. I'rtiuhart&Co. 1250 00 $7,')50 00 Schedule D. Torrance & Co, $452 50 Kingan A' Kinloch. 360 00 \i. Rolbrd & Co. 380 34 Alex. L'rfjuhart&Co. 138 m Crosse & Blackwell. 148 (« Kent Ac, 11. Stephens. 1333 34 Francis Chisholni. 260 07 Robert Bridge. 133 .34 $3218 87 01 71 I J I— t t: 8 8 S 8 8 u o 1500 1200 1350 2250 1230 «> t^ J c 1 3 : W •^ •00(1 ■Mtfi •!•»(> ••'-•H •itiiV •A|I1I' 12 1 •.»llll(' 1 12 ••<"W •|H''V 1 IC 1 f-M •^ 1 •jiiiv •M'VI •mil' ui 6 o 6 o 7! a a a s s H M -^ -i N iC a 1 !3 s >1 O Oi f -H m w • 1 . , > •. o d a: ^ ' o O O o »■ ! ^ . «y -Jd -<■. c 1 "2 -^ CO £ ; * c o a; r » Ci a E- * « g " ^ ^ Js c tf u 3 < « u b -«i « i=> "x (J V rf . I i 5! ►:a •S^j w '/J « g 4; 33 '"2 'J H *■ c ^a P-( »j 3a 1= t £ ■OS X-c 4,— C3— ' •St: •^ C •ll.lj,' ""•afiy^ •'«l''r •.nine •AI.IV •|u.lV •jiHV ''\M •UB(' J^ - H a a u n a UJ '/J o W : t p: o •^ -t! U a Is rt -9 -J u ^ 1 w o -< p. K? r- -1 72 N». To JUH, I IH7H. Aiiioiiiit, Rnleml C. fi. fo. No. To Juu. 187«. Aonoiint 3> Entered V.B. Jo. Aiiiiiiiiil, No. To Jim, |h7h. Account S S Airiciiiiit, Entered C. B.fo. No. Juh 1878. To Account S Entered V. li. fo. Auiiiunt, 73 Consolidated Bank Account. 1878 Jhh. 10 12 25 25 I>i!|i<>8ite(], Do. fioss Clik. No. 1 Lbss Chk. No 2. Deposited, Do. D... Do. Less Chk. No. 3 Less Chk. No. 4 Korwiird $4')00 500 450(J 2575 l!t25 797 1127 600 300 l.W) 50(1 3727 1050 2<)77 193 $24.S3 00 00 00 00 00 M 5(J W 00 00 00 50 00 50 74 7() No. 1. Jan. lol To »IcJ)0UOAl.i, A D| Acc't Ontario Buni A III Entered C. U. fo. 1 . No. •>. Jiiii. <.-lil,\ To JosKPH Tiffin A Ai-c't Mdse- .■Villi Entereil 0. B. fo. 3. No. 3. Jiut. 25tli, 1 To KlNGAN & KiNi-orn Acc't Mdse. Ainoi Entered C. B./o. 4. No.i. Jan. '2&ll,, 1 To D. TORRANCK A Co Acc't Mdse. Ainoi Entered C. B.fo. t- BANK CHEQUE BOOK. No.\. Jan. \Qth, 18"8. To "IcDouQAU. & Davidson. Aci-'t Ontario Bank Stock. Amount, $ Entered C. li. fo. 1 . 2575 00 No. Jan. 12f/<,lij78. To JosKHH Tiffin A Oo. Ace't Mdse. Amount, $ Enteri-d U.B.fo. 3, 79T iVo. 8. Jun. 25M. 1878. To Kinoan k Kini-och. Acc't Md-se. Amount, $ Enttred C. B.fo. A. Consolidated Bank of Canada. Montreal, J6V^. ©ttc^Du^aEC '^ Sli)ai>idjoti- or order, tlie sum of [ii>o lnuii.sati() [loe liiuulYeJ- aitu J>ci>entu- iiM' ami ,Oy'i, Doi,LAKa, A. B. C. and (•harf,^e to account oi' $2575.00 50 Consolidated Bank of Canada. .Vo. I', Montreal, 'Jan. fSiK, i^l^. No. 4. Jan. 25lh, 1878. To D. Torranck & Co. Acc't Mdsu. Amount, $ Entered C.B./o. '2- 1050 00 3?a.) to ©IfpeiiU. Jo.se^r. Qlff^t "IJ ^o.: or order, the sum of .seupii luuiiiiet) aiiil .iiitetiiiyeucn. and ^*y'J, Dollars, and charp:e to account ot $797-50 A. B. C. Consolidated Bank of Canada, ^1 o. .?. Montreal, Jaa. iJ5tH, '{^"^k itfaij TO dMsfeiiiiM,. 9^[.v(jun, "^ ^ia- Poctv, or order, the sum of Qen- Hiuv.lij ifvvee and ,Vy Dollars, and charge to account of $193.74 A. B. C. I'ril I : APPENDIX. SThnilJNGi EXCHANGE. The rate of Excliange is in reality the advance on the old par of Exchange which wan estahlishcd many years ago. The way of calcu- hating it is now i-educcd to the following Hin\])lo rule as being most accurate. EuLE. — Treat the pound Sterling as if it were four dollars, and the shillings as if they were twenty cents, and the pence as if they were one and two-third cents each. Then arrange the Sterling amount in that way as if it were currency, and then add to that the rate of Exchange in the same manner as you would if it were interest. 7vdd those together, then add one-ninth to the Avhole, and the product will be the correct answer. EXAMPLE. Find the Curreiiry ol X1T5 18 lu Sttiliun, the rate of exchange being Tjj per cent. i:i75 X 4 =|;7()o 00 188. X 20c. = :5 GO lOd. X 1| =. 16 Tu3 7(J Hate of Exchange. 7i^ p.c. 54 54 758 30 Add I th 84 25 Answer, $842 55 In Caniidii I'lirrency. Note. — What is now called the j)ar of E.vcliange is 9^ p.c, or equal to $4.86|. 76 APPENDIX. TO OONYERT CANADA (JURRENCY INTO STERLING. RuLE.-Divide the amount by tho Divisor opposite tho rate of JLxchango, and add two ciphers to the cents, thus: mvisoK. ■t 8 3 :i 3 f'AXAIIA c't. STKRMvr;. t 1 f>. \ fj 5 2 7 00 / XJ,;. / 4 8 3 3 3 ( 1 « »5 1) !> 14 4 9 9 2 19 4 10 193332 2(50 V8 2 for shillings. \ 5 2 m / 1 / 4 8 3 3 3 \ 3 8 2 3 1 2 Pence. \ 458760 / J 434 09 7 \ 2 3 7 6 3 :'AHLE OF DIVlsiOKS RATES OF EXCHANGK. 6 - 6} 6| 7 - H 8 - H H- H 9 - 9^ 9^- I'FVISORS. 4 7,111 47.222 47,333 47,444 47,.^>r)5 47.(;66 47.777 47,888 48,000 48,111 48,222 48,333 48,444 48„'-).5G 48,6GC liATKS OF E.\rUAN(iE. 10 - 10.1 104 - lof 11 - 11.1 in - 11^ 12 - 121 12J - 12| . 13 - DIVISORS. 48,778 48,889 40,000 40,111 49.222 49,333 40,444 40,5,') <> 49,667 49,778 49,889 50,000 50, 1 1 1 50,222 i! II ml ' n\ APPENDIX. INTEEPIST. Most offices have an Interest Tiible Book, but if not convenient and when ill a place where such a Book is not handy, the followin;.^ rule Avill be found most accurate and easily remenibeied and understood. RuLK. — Multiply the amount by the rate of interest, and the pro- duct by the number of days that the interest has to be calculated on and if there are cents, divide the last product by 36500; but if you omit cents, then divide by 365 only. EXAMPLE. What is the Interest on $2476i3u8y at the rate of 13 p.c. per ». inum tor 315 days ? Say $2476.38 1 3 rate of interest. 7429 14 247638 3 2 19 2 9 4 . 3 1 .5 days. 1 6 9 6 4 7 3 2 19 2 9 4 !» 6 .5 7 8 a 2 36 5 \ 1 1 4 7 7 G ] (1 / 2 7 7 A^ & ?4t)io I I 10 3660*' / 7 3000 \ 2 840 7 7 2 5 5 5 28 5 7 76 2 5 5 5 3 2 7 6 1 3 9 2 1 T 6 1 7 3 3 4 6 10 |- 4^ Discount and Premiums are sufficiently explained already, and ar< well known to everybody. 78 MBll APPENDIX. TIME. ThiH Tabic Hhews the number of dajH from any day of one month to the Hame day of any other month. FROM ANY DAY OF TO THE SAME DAY OF 'a eS a, a July. Aug. •4^ 03 o O o 55 d Q January .... 365 31 59 90 120 151 181 212 243 273 304 334 February . . . 334 365 1 28 59 89 120 150 181 212 242] 273 303 March 306 337 365 31 61 92 122 153 184 214 245 275 April 275 306 334 365 30 61 91 122 153 183 214 244 May 245 2V« 304 335 365 31 61 92 123 153 184 214 June 214 245 273 304 334 365 30 61 92 122 153 183 July 184 215 243 274 304 335 365 ! 31 ' 62 92 123 153 August .... 153 184 212 243 273 304 334 1 365 31 61 92 122 September . , 122 153 181 212 242 273 303 334 , 365 30 61 91 Ottober .... 92 123 151 182 212 243 273 304 335 365 31 61 November . . . 61 92 1 120 1.51 181 212 242 273 304 334 365 30 December . . . 31 62 ' 90 121 151 182 212 243 274 304 335 365 EXAMPLE No. 1. How many days from Jan. 10 to Oct. 10 ? cro1riTnl~?finH".f7T"'^^' "'' •^''"- ''"" "^ ^^^t-haiul column until I reach Oct. in the cross lines, 1 hna 273 days as answer. , EXAMPLE No. 2. TIow many days from March .inl to July 24th? ihiT'^r^ ^ fallowing the March Lne until I come to July, I find 122 days; hut ( ome to the 24th, I add them to 1 22 days, as noted, which makes 143 days . 1 as correct EXAMPLE No. 3. How many days from August loth to April 5th? Amiocr.—vxv like manner, follow August line to April, and I find 243 but that i Xs^faCr" "" ''' '^ '^" "^^ '^''"'^ ' m'ust'subtract themtandlt'Ste to 238 days as answer. IS ives 70 APPENDIX. Ms 'ihit' 11 It i '4 ii i-t AVBRAGENd OK ACCOUNTS, OK' THK Kc^CATION OF TIME AND VATiUK. To 1)0 iicciirulc ill I ho (lol)i(iii,!^ or crcdUin^ Tiitorost when Hcttlinif an ucc'ouiit, HO thiit ncMtlier party may have any advantage as to tho point of tinio, I'ocourso is had to an ahsoiiito orpiitahlo .ivorago of ))nth tho dayn and amount« in question — not by t/iiess ivork, but hy tho following un(|uostional)le, clear and deciHive calculations, wliicli can always l)0 proved by the lengthy process of Interest on each item. Ri:le. — First put down (ho date, next the amount (omitting cents under SOe., and adding one dollar when over tAk:.) then juit dowu tho nunjber of days that intervene between tho first date and tho next in order, and so progress to tho end, always bear in mind that the number of days in every case are calculated from tho first date in tho Account. You then multiply each separate amount, by tho number of da3's so ascertained and set opposite to that amouni, placing theii- pi-oduct on the I'ight hand side opposite eaidi such calculation. When all this is ropor head, and also tho product of tho calculations in like manner, and th >n divide tho latter by tho amount of tho account, and the quotient will be tho num- ber of days forward from the first datt^, when that side of the account will average. Of course tho above has reference only to orio side of the account. Each side must bo calculated in tho same way separately. KXAMPLE No. I. I sold poods <() .lames Harvey at ditleront dates, and all at .'i mos. credit, and want to know the avirago date of the whole. Say sold on Jan. 10, $256.70 ; Jan. 19th, f 134.20 ; Feb. 11th, $314.G0 ; and April 19th, $127.30. Ansivcr.—Ua,y 7th. Jan. 1 oth . . $257 .1 1 9th . i;{4 X 9 = 1206 Feb. Nth . . .315 X 32= 10080 Apl. 19th . 127 X 99= 12573 $83:5 \ 23859/28 Days from Jany 10th, is say / 16(i(! \ F(l). 7th, when the average 7199 r>()(;4 536 would lie dtio, hut to this must ho added 3 month's credit which makes the am't^ actually due May 7th. 80 BBB APPENDIX. EXAMPLE No. 2. I sold good to Charles f'hiimliers on diiTcront terras of credit, an I want to know the avera^'c date when tlic whole would l>c (!<|iially th. $;i00 (u) 8 rnos. a;id $150 cawh ; January 25th, $200 cash, and $400 ffb 4 nios. ; aluo April 16th, $200 tci) ^^ mos. and $250 at 4 nios. Answer. — In this case I i)Ut down the dates in order t>f sale and wlien due, I hen rearrange the whoh' in the manner of Example No. 1 , as follows, and th(^ anxwer will be M(i;i blh actually, hecauije the terms of sales are already taken into account. IiKAHHA.NCfEI) AS TO TiMB WHEN KACH AcTi-AL Salk a.ni» Tk It MS WAS 1Ji:k. Jan. 5. $300 at ?> months — dui Apri 1 5 .Ian. 5. $150— II 5. 15(1 Cash ■Ian. 5 •' 25. 200 X 20= 4000 « 25. 200 do II 25 Apl. 5. 300 X 1)0=27000 II 25. 400 at 4 months May 25 May 25. 400 X 140 = oC.OOO Apl. 16. 200 3 do July 1(! .lulyU;. 200 X 102= 38400 11 16. 250 4 do Aug. 16 Aug. K). 250 X 223= 557.50 $1500 ? 151 10 \ 181150/ ,) 1.500 ('20nnys 3115 .3ono 1150 The answer of 120 Days from January 5 is May 5th, when all will he due. DOUBLE AVEEAfJlNd. OR R(,)UATTNG TIIH TWO SIDES OF AN ACCOUNT. This work is not gciici'ally known I>y Book- Iv copers as a rule — it is properly speakitii; the equating of an aeeount current and is done as Ibllows: Yon iiiust first avcra^'c c;ich side ol'thti account separalcly as in llic pn>vious n\c(hod — then Miulti|)ly the ainonntof tlu^ smallest side of the account by the number of days that intervene bet\ve<'n the ascer- tained average dates of the two sides, and divide the ]»roduct by the balance of the account, and the (juolicnt will bo the number of days to be reckoned backward from the average date of tlu^ largest side of the account, th'^t is, in all eaues where tiu! average date of the smaller side is later than the averaje date of the fonin'r, because^ such average^ ]»ay- racnts on account were made later than the debt. But when the 81 APPENDIX. avorapje date of the sm;illor sido \n liarlior than the average dale of tho larger wido, then the dayn produced are recUtmcd forward Irom tho average date of the hirgent side. See examples foHowing: — Note. — Htiving aKc. rtainod tho averafj;(> diitc of ohcIi kIiIc of tho jk count in manner stated, proceed as per Exaniph's 1, 2 and 3, hereto api)emk(l. However, wlien th<- work is so far done, the evidence given below of proof of accuracy may be adopted aH more Hiniple to those v ho may not be thoroughly clear on the subject. EXAiMI'LE No. 3. Find tho average date when tho balance of tho following Account Current would fall due; assuming that you have made all the transactions without any terms of ( redit, oi' as cash. Dr. CUAIILKS Si MNBIl & Co. IN AcOOUXT WJTH A. 15. (,'. (MVSKLK.) Cr. 1878 1H78 Feb. 2t To Cash $300 00 Feb. 11 By i\Ierchan(lis('. $5fi4 00 1. 28 '■ do 200 00 i( 20 do . . 311 00 T\Iar. 10 •' Merchandise 175 (II) Mar. 3 '; do . . 264 00 April 'w-O '• Cash 200 no ■• 31 " do . . 226 00 May 2tJ •• do Averar/e date of above, April 10. Balance of acct. . 500 $1375 344 00 (10 iiO April 15 '• do Average date of above is Mar. 7. .^54 $1719 on $1719 00 00 1 1 Proceed thus. — The smallest side of above account is $1 3 75 Numb( r of days between March 7th and Ajiril I Otli is 3 4 5 500 4 12 5 Divide by balance of account, $ 3 4 4 \ 4 6 7 5 / 1 3 / 3 4 4 \ 6 days. 12 35 1032 2030 2 6 4 nearly. Above makes 136 days to be counted bark from March 7th (that being the largest side of the account), and makes the balance of the debt due Oct. 22, 1877. Thii* is 82 APPENDIX. 564 00 11 on 64 00 26 00 54 00 f IS because the average date of payments on account is later than Marcli 7th of this being correct, I iliimtrate it by Interest as follows :_ ritOOF op ACCfRACY. / ower? Charles Sumner & Co., as on the 7th March $1719. oa To this add Interest from March 7th to 26th May, daVo of settlement " „„ ^, 22.60 Leas ; 1 paid on account as on 10(h April ^msTo To this add Interest from lofh April to May 26th .'. jo.'ay Say actual balance in Statement was $344.00 Interest on $344 from Oct. 22 to May 26, is.. . 12.21 Balance due. . In proof $1741,60 $138,5.39 $356.21 $356.21 All Interest here 's at 6 pev cent. EXAMPLE No. 4. In the same way average the following : Isaac Frost in Account with A. B. C. (Mvsklf.) Dr Cr. 1878 1878 __ Feb. J6 To Merchandise 200 00 Feb. 16 By Cash 100 00 tt 26 li .. ;!()o 00 11 1 27 II 200 00 Mar. 10 II II 175 00 Mar. 10 1' II 100 00 II 28 1' 11 250 00 I 28 ii 11 150 00 April 13 11 II Ai'eriii/e date of above is Mar. 15 350 11275 00 00 April 30 ! i i 1' II Average date of above is Mar. 21 balance 200 750 525 00 00 00 1275 00 1 Proceed t/u,s.—Thv smallest side in above statement i « $750 Number of da ys betw een 1 War. 15 i md 1 n I. 6 Divide by balance of account $525^ '^^^^^ / ^ ^.^^.^ Above makes 8 days before the averajro date of the liro-p,- viri,. ... w k. 83 AI'PENDrX. SPECIAL EXAMPLE No. 6. In tlio SHtno way avornge tlio following : Dr. .ToHiAii Aknolo in Accoint with A. B. C. (MYSKiiK.) 1878 Feb. Mar. April 'I'o Merc liaiidisc Av'i/e dale Mtir. Ki 1878 •IM (10 F.-l., 14 ;}()o 00 1. 27 S.'iO 00 Mar. 10 200 00 April 1 400 00 $1,^)00 (10 iiy Cash Av'iff Jute Mar. 12 Balaiifu Cr. 1 r,ii 200 200 350 900 Goo $1500 00 00 00 00 00 00 00 J'roceed l/iiiit.-^Thv smallo.st sido in aliovc statoinont is $!)00 Niuuber of dajH bctwiMMi Mar. 12 and Mar. k; is 4 Divide l>y Uic balant'c of aci ount. \ ;t(;oo / ■^"'V 3000 v« ^"y« SPECTAL. — Those six (1(11/ s (ire added to the avenuje (Me of the largest side hecduse the arer(uje date of the pKi/ments on dccount is before the date uf the debt, therefure t/ii.s Ixt/ance would be due MA/iVii 22nd. Stamp. BUSINESS FOKMS. UHUAL FDllM OF DHAKT. .187 pay to the order of DollarH, value reccive(^l and charge the same to account of T« 84 Cr. 00 00 00 00 00 00 stamp. A^PKM)rx. D8UAL FOIIM OK I'UOMIS.SOHV NOTK. 1o the order o'l'.. at (lie lur value received. Puo after date KOtlBION BILI, OK KXCHANOB. Ko... 187 promiHe to puy Dollar! .187 ExcilANnE FOR £ «fo- "'■&• a^i«>' (»r this KrRST of Exchange, (Hecond and third of same tenor and date unpaid) pay to the order of Sterling value received and .•Juirge the name with or without further advice to account of To The ,...m/amWAm/ of Ex.l,an^e»re similar to the .//..^-except that they .state that they are second and third re.,,oc.tnely and that the consecu.ent worWinir i. appropriately altere^^^^^ l.Sl'AL FOUM OK KECEIPT. Montreal, Jan. 15th, 1879 Received fj-om Joseph Chalmers, Esq., of Toronto, Ont., the sum 85 AIM'ENDIX. w of one tliouHJind five Jiimdred uiid twenty i% BoIlai'H, l»eing his chtxiuo vvitli which to rotiru hin nolo duo 18th inst. $1520.00 Signed, A. B. C. CAUTION. Special care Hhoiild alwayw bo obHerved in writinj^ recei])ls, in order to bo safe, and prevent the possibility of any advantage being taken of careless omissions or too comjjrehensivo expressions, by I'oason of which thonsanils of dollars hav(^ been losl. Be sure to state in the receipf what you do actually receive, both the substance as well as the amount, and when necessary to state in full of account, mention the ihite to which it is paid u|), and in all such cases see that your Books lally with the weltlenient before you give the receipt. There is no limit to the forms of receipts, and consequently many are fraraetl specially to cover the intentions of the parties interested ; in all such cases the greatest cai-e must be observed, and if of very great ini])ortance, better have it examined by a Notary Public or Lawyer than run any risk. Remember that the expression, "in full of all claims and demands " is the most sweeping way of closing up all recourse at correction »hould that be found necessary, even if an error be discovered subse- quently. Where the least doubt exists as to a possibility of an error, it is better to use only the woi-ds, in f\dl of account to date and fill in the date intended ; or say, in full of this Statement of Account, when written at the bottom of such a document — and if settled by Note ffive all the particulars and conditions, and state that when said Note is paid it will be a discharge for so nmch ; again, if payment is made by a cheque that has not been accepted by tbe Uank, the receipt should state that you receive from bis cheque for the sum of. , say nothing further in such case for the time being; because persons have been led into troisble thi-ough granting receipts for cash when only a cheque was given and that not accepted by the Bank for want of funda. THE END. ItlH c. )rdor on of n of both ifull hucIj ; the lany ted; ^oiy ; or ds" fcion bse- I'OI-, fill int, by aid t ' IS pt |uin he