IMAGE EVALUATION TEST TARGET (MT-3) /, 1.0 I.I ■^ 1^ 121 Hi l«0 IIJ5 yii 1.4 ■ 2.0 ■ 1.6 Photographic Sciences Corporalion .sj *^v <^ ^. i\ 23 WEST MAIN STMIT WltSTEI,N.Y. USIO (716)«7a-4S03 CIHM/ICMH Microfiche Series. CIHM/ICMH Collection de microfiches. Canadian Institute for Historical Microreproductions / Institut Canadian de microreproductions historiques iV Technical and Bibliographic Notas/Notas tachniques at bibliographiques Tha Instituta has ffttamptad to obtain tha bast original copy availabia for filming. Features of this copy which may be bibliographically unique, which may alter any of the images in the reproduction, or which may significantly change the usual method of filming, are checked below. D D n n □ n n D n Coloured covers/ Couverture de couleur Covers damaged/ Couverturo endommagde Covers restored and/or laminated/ Couverture restaurie et/ou pellicul^e Cover title missing/ Le titre de couverture manque Coloured maps/ Cartes gdographiques en couleur Coloured ink (i.e. other than blue O' black)/ Encre de couleur (i.e. autre que bieue ou noire) Coloured plates and/or illustrations/ Planches et/ou illustrations en couleur Bound with other material/ Relid avec d'autres documents Tight binding may cause shadows or distortion along interior margin/ La reliure serr^e peut causer de Tombrc ou de (meaning "CON- TINUED"), or the symbol V (moaning "END"), whichever uppiies. Un des symboles suivants apparaftra sur la dernidre image de cheque microfiche, selon le cas: le symbole —*- signifie "A SUIVRE", le symbols V signifie "FIN". Maps, plates, charts, etc., may be filmed at different reduction ratios. Those too large to be entirely included in one exposure are filmed beginning in the upper left hand corner, left to right and top to bottom, as many frames as required. The following diagrams illustrate the method: Les cartes, planches, tableaux, etc., peuvent Atre film6s d des taux de reduction diff fronts. Lorsque le document est trop grand pour Atre reproduit en un seul clichA, il est film6 d partir de Tangle supArieur gauche, de gauche d droite, et de haut en bas, en prenant le nombre d'images nAcessaire. Les diagrammes suivants illustrent la mAthode. 1 i 2 3 1 2 3 4 5 6 V. ■; \ r "• * ■'fe. <^.i } Hi Specie A THO Pres COPIOl ASH S' / / / Js. MANUAL OF. BOOK-KEEPING BEING THE PART OF THE STUDENT Specially adapted to Simultaneous Teaching, CONTAINING A THOROUGH COURSE OP SINGLE AND DOUBLE ENTRY, Presented in Question and Answer Fonn« •;> \ :'' '.,, " 1 '-' '- ■ \ ■'-'■■-V ■*. .'■- -■ TO WHICH IS ADDED COPIOUS EXEECISES FOR HOME WOBE; ALSO A SHORT KEATIES ON COMMERCIAL LAW. -COO' ST^, ANNE DE LA PGCA'PlilRB:; // / / / FIRMIN H. PROULX, OHIAP f^llSIC S^CHt:- .4r, CRAIG W< ':■■%• * JH ' ■ .\.,^-. ^\ i -Tft'^'r r"*" XT " ^ r" f\ I* ^« 5 J ( I i < ' ' }JAkl: i S 1' ■ .'i • ' mMii'i ->.. i-. .V .4. *.5 ■ y ■ -■< Entered, accordiDg to the Act of the Parliament of Canada, in the Year one Thousand Eight Hundred and Seventy- one, by the proprietor, in the Office of the Mi- nister of Agriculture. t ' •^' .WAJ imfiim:i^ m 83 :|3fA' TCtfTS h;;"u:j imm A -••-*-i:OQ&:"»- ■iiv "TfTAOO^ /J lAd a*Xi4^ .2i7o;:a .h yjui.'ci »« CONTENTS. .... . ■.•.;!. I ■.,, '..'- ...:■■:■") — - • ■ . . (:. •: .■,'<, \ ) I I ' :' ■^'■n < "r;*"! ; * The method to be used.............. ..\1.» /.'..'...! * '!'#1^ Single Entry. .; . , , J}:^^ General Questions « 9^ Cash-Book 10 < Invoice-Book 11 Sales-Book v ll.^ Bill Book 12' Day-Book. 13^' Ledeer ; 14 ^- Posting of Books 15; Index 15 ' Dealings with persons on Credit 1<> ^ Accounts..^ 16-: Besources and Liabilities 17 ■- Formulas , 19 , Double Entry. General Questions ., 25 Day-Book '. , 26 Journal 26 Ledger 28 Auxiliary Books .'... 29 Terms Dr. and Cr 31 Accounts 32 " Heal and Representative 33 Bills Beceivable and Papable 34 Real Estate. 37 Shipment and Consignment 37 Merchandise Company Accounts 38 Personal Account 42 Stock Account 42 Principles 44 1 tf CONTKNTS. General Instructions •• 47 Ledger ^ » ^^ Closing the Ledger 54 Order of Closing •••• 57 General Remarks 61 Economical Method ' 67 Changing Single Entry to Double 76 Process of Changing .'. 78 Practical Hints 81 Detecting errors in Trial Balance 83 Short Treaties on Commercial Law. Technical Names of Bills 88^ Exchange , 90 Promissory Notes •.... ^4 Negotiable Paper , 96 Diability connected with Negotiable Paper 101 Presentment, &c ». 105 Beads, Bonds, &c *.. 108 Testimony of Accounts Ill Forms of Bilib, Notes, Draft, &c 113 . Exercises. Exercises in Journalizing 12& Exercises in Single Entry 133 Exercises in Doubly Entoy . 1^5 m -,' , •-"'. I? THE METHOD TO BE USED. w The design of Hiis book^ io not so much to show farther development of Book-keeping as a science, bu rather to simplify the method of teaching it, so that eveu yerj youog pupils may be able to comprehend and app^ its principles. It is well known that this science is a most abstract one ; and that the number of its calculations and length of its monotonous process, does not heighten the interest or pique the curiosity of pupih generally. Also the amount of cautious attention whic^ it demands seeBM 'to tax fheir mental faculties so much, t&at &e slightest iie- glect or indifference shown this subject by teachers, pro- 'duces in them a most profound disgust for it in «11 its bearings. Hence the necessity of encouraging those un- dertaking its study and of ^rendering their task as light and as interesting as possible. ^, y. , , •.:?m-y- It may not be amiss here, to expose some of the many difficulties experienced in the teaching of this important subject, as also the means adopted inihisbook to obviate many of these. The methods used in most books, treating this subject, are better adapted for the use of teachers and private students, than for the simultaneous training of a class Of pupils for mercantile persuits. The best method is that -which exercises the mind most, according to its capacity;. Now to expect that a olass of youths, sent home to oom^ mit to memory, upon a slight explanation from their text i)ooks, can be expected on returning to have clear ideas of principles, obscured therein by long explanations, dif- ificult applications, and tiresome references to formula^, 18 simply preposterous; even those who may have^uadfl^- t; MKTllUl*. stood them the previous day are liable to have very con- fused notions after refering to such text books. ,. The main features of this book arc, that it throws all application and references to formulas totally on tho teacher for blackboard cxplaration, but furnishes the pupil with the matter which is to b(< committed to me- mory, and exercises for application, intended for home work. Another is the close proximity of question to answer, greatly facilitating their comparison, while it is time saving to teacher in the asking of the task. Also the shortness of the questions and answers will prove en- couraging to the pupils. iv II I Process of Teaching. — After the first or second lesson, pupils should be practised to the forms of recording original entries, which is the work of but a few lessons, whereupon Journalizing should be introduced. ^'^^ Here the teacher should take great pains in explaining the values of Dr. and Cr. ; and even he should accept of no signification other than " What costs the concern value " is Dr., and " What produces the concern value " is Cr. ; accept no oral expression unless the above signific- ation is expressed ; for it but too often happens that pupils, in applying these abreviations, have not the prop- er value of the terms they indicate. The teacher him- self should guard, as much as possible, against orally ex- pressing the words Dr. and Cr. if pupils are to be tho- roughly drilled into their proper application. ^-^-'^ Supposing the pupils to journalise pretty well, we now come to what demand« the most cautious attention — -the Ledger. This book should be more especially illustrat- ed, on large blackboards ; for this purpose a commercial , class should have from 80 to 100 square feet of black- board surface. The pupils should be obliged — under the direction and supervision of the teacher — to make out a set on the blackboard something ia this way : — - Buppose a boy to call the transactions from memorauduiQ f 'I * t ^ METlluD. . 7 — (lispensiog with the writing out of tlie Day-Book — the teacher designates each boy alternatively to journalise orally (as by far the greater part of the transactions are simple, but when a long or a strange transaction occurs, they f«hould make slate work of it), there being two boys at the blackboard, who, as the transaction is journalised, respectively debit and credit the Ledger. Continue thus till the entire memorandum has found its way into the Ledger. Here an important change takes place ; the teacher explains the " order of closing " thereupon the pupils proceed to " close up." This being done, and Led- ger proving correct, the caller of the memorandum may now give out the questions referring to the Ledger, which the teacher should explain in application to the closed set. One pupil at the blackboard would be sufficient to begin by ; but as soon aa posting is sufficiently known, it is more expeditious to employ two. An ordinary set of thirty entries can be properly got through within an hour aud a half, and, after some practice, within an hour. There should also be short sets given once a week, as home work ; and as soon as the teacher perceives that his pupils have understood the process of working out a set, and that it is want of cau- tious attention, that causes their results to prove incor- rect, he should begin to abandon all further illustrations, and oblige his pupils to find out their own mistakes — not allow them to make blunders for their teacher to correct. With the above methoi of teaching, a class of pupils may be brought, within a year, to have a very fair know )edge of this important subject. ^. ^ .ii' r "^ , ,-: c '- I it ^1 i\ QUESTIONS ,':'* ON SINGLE ENTRY BOOK-KEEPING. ' — 000 — ■Ji r :^*^±.. k. 1 What is Single Entry Book-Keeping ? Ans,— It is an art which teaches to record sys- tematically the various transactions of busi- ness. 2 What is the particular necessity of Book-Keep ing? Ans, — It is to preserve a record of such exchanges as would be otherwise trusted to meniory. Sem, — A more thorough knowledge of the science em- braces other most important results. 3 What books are introduced in this system of Book-Keeping ? Ans. — The Cash-Book, Invoice-Book, Salee- Book, Bill-Book, Day-Book, Ledger, &c. 4 Which among these are indispensable in eve ry well conducted business ? ^n«,— The Cash-Book, Sales-Book, Day-Book, and Ledger. 5 What do you say of the others ? Ana* — They depend upon the amount and kind of information required. 10 CASH-BOOK. 6 What is the Cash-Book ? Arts, — It is a book wherein are entered all re* ceipl<< and disbursements of cash. 7 Is this an important book ? Ans. — Of all books used in business none is more essential than this ; and no cautions business man will ever attempt to do with- out it. («) ^ / T M ^ : •..,./ r 8 When should the Cash-Bock be closed ? Ans. — It is customary to close up this book ta the end of each business day, bringing down the balance as a basis for the next d^y's trans- - actions. 9 What is shown in the Cash-Book ? Ans. — On the debtor side rae shown all receipts ,, of cash and on the creditor all disbursements. < IQ What is shown by the difference between the «' sides? :i'.>rj-^ 'lu i.iuori c? r'i'^^'nr ■ ^i )f~~.t<^:^. Ans. — The difference shall be the exact amount . , of Cash on hand. ., r • •. , ., . . • • ... t\ 11 What advantage is obtained by a faithful record of this book ? Ans, — It gives a great degree of confidence in •* business. Rem. — The difliculty of making pupils understand " why " Cash is debited when money is received and why credited when it is paid out " may be obviated by explaining the^'* original meaning of the word Cash. This word originally signified Chesty or a place where money was kept instead) (a) It is true the amount of cash on hand may be easily- BKCertained at any time by counting it ; but this process* atlords no test as to improper expenditures or omissions. (!ASII-B0OK. .? I.. h:hu\ DSiii of the money itself. Now, if I place all the money t re- ceived in a certain box, I could at any time tell, from my books, how much there was in it by making tbe box Dr. for all sums placed in it and Or, for all sums taken out. We treat Cash in a manner precisely similar. . . 12 How many forms of ruling the Cash-Book are ; '.' ' there? •"■ '''"'' /■'"' '''""'' ''"'''■ '^'^ '^^ ' Ans. — There are two forms and both are ruled . , alike ; but the one takes up the two facing sides (the left for cash receipts and the right for disbursements) ; whereas the other is con- fined to one side only, with debit and cred- it columns contiguous, r, liiloi -hH n{^:) l^j 13 What does the Invoice-Book contain ? Arts. — It contains a minute description of all the merchandise with which we are concerned. 14 From what are entries in this book made. 15 Are our goods and the goods of others (e. e. goods on commission ) entered in the same J; way in this book ? ,: * ^ » Arts. — ^They are not, the ambtints of our goods are extended into the money columns, where- as the amount of other goods are not extended^ 16 Can the cost of merchandise be ascertained f •;ihji Ifrom this book ?; if -.>..,}> ,■ ?»<. : -* ,,, ,> . i „ -, » .4?M.— Yes, since the amounts are carried forward from page to page the sum tptal on the last page must show this cost. . ._| ^^j^ ^^^.^,y 17 Whatas the Sales-Book ? n Vr^T * Ans, — It is a book which contains a description , ^ of all the merchandise we sell or pass out of our possession. . " ->^..-. 18 When is an entry made in this book ? 12 SALI8B00K. ^n«.— As soon as the purchaser has selected his goods, and from this entry his bill is made out.* • 19 Of what should the entry consist? Ans, — Of the quantity, quality, and price of the goods sold. 20 Do you make any difference in the entries of your goods and the goods of others in the Sales-Book ? An^, — Yes we do, but in entering the sales of com- mission goods we do not extend the amounts into the money columns. 21 Can the total amount of sales be ascertained from this book ? Ans. — It cannot, as ih^ retail cash sales are not entered in the Sales-Book. 22 How is the amount of sales found ? '^^ a. - Ans, — By reference to the last page of the Sales- Book for the credit sales^ and to the Cash- Book for the retail cash sales. Rem. — Tke Sales-Book may be so kept as to post the credit sales directly to the personal accounts. This affords a great saving of time, and is quite as satisfactory. ' *• * » Jr. / ^.i. 28 What does the Bill-Book contain ? Ans. — It contains a description of all notes, drafts* and other species of paper, agaitist us and in our favor. ... - ^ >. Wr 24 Name the two kinds of notes ? Ans. — Bills Receivable and Bills Payable. vi 25 What is meant by Bills Receivable ? Ans. — Notes that are in our favor, the amounti of which we are to receive- BILL-BOOK. 13 his lade »f the ries of in the com- lounts ained re not Sales- Cash- lost the affords J rafts, md ill Vr ountf 36 What are Bills Payable ? Ana. — Notes which are against us, the aiQounta of which we are to pay. 27 Describe the raling of the Bill-Book ? . iln^.—Each page of this book shoald be divided into twelve spaces, and each space of a due proportion to the matter to be inscribed. 28 What is a proper caption for each colanm in this book? iitw.— For the Ist. The Number; — 2nd. When received * ; — 3rd. For what received ;— 4th. The drawer or Endorser ; — 5th. The Drawee 6r Maker ;— 6th. The Date ;— 7th. The Term ; —8th. When Due ; — 9th. and 10th. Amount; •-^llth. When Disposed of; — and 12th. How Disposed of. ( See example Page 20). Rem. — ^The Notes Received are labelled and put away in a secure pl&ce ; ail information relating to them is obtain- ed on reference to this book without examining the pack* ages of Notes. 29 Describe the Bay-^ook ? Ans.-^lt is a book which contains statements of all transactions which give rise to persons owing us, or to our owing them. 30 What is the form of record used in the Day- ,^ Change Received for Issued and you shall have th« pipper caption for Bills Payable. It is usual to put the last day of grace in the <' When Due'*' column. /;: ■■ -■'•' -:^-'---' -i- ■: --^ . ,-:.- ■> -..^ r- For convenience and distinction^ each Note is namb#i«d when received or issued, commencing No. 1, 2, 3, &c* foi the receired^ and commencing in alike manner for the 14 DAY-BOOK. •>') ' Book? Ans. — It is direct and simple : first expressing ihe name of the person to be debited or * credited on the Ledger, and next the consid- * eration and amount together with the fact of "Dr. "or"Cr." ... 31 To where are these records transferred ? Ans. — They are transferred under appropriate J Ledger accounts, and thus exhibit i]ae result^ .' of the transactions, so far as persons are" e concerned. t ' ' IN O I'.- ,:.]'■ 32 In what books are entered long details of goods bought or sold ? I 4 I •.^•*-' Cl : f 1 p1 t1i"5 jxt* Ans. — In the Sales and Invoice Books which are designed to show the particulars in regard '< to the quantity of Merchandise bought or - sold, and never in the Day-Book. 32 Describe the Ledger ? Ana. — This book is used to exhibit the relation in ' which the various 'persons with whom we;^ -■■ deal on account stand to our business; and '^ contains, therefore, only personal accounts. 33 What is the object of the Ledger? ^i -" ' Ans. — It is to show in one view all concerning a person. ^m. — The sums which the person owes us, and which we owe him, are scattered from one end of the Day-Book to the other j but in the Ledger all those sums are drawn ^ on one page, and, by subtracting one side of the account from the other we obtain the balance which is due to him' or us. / I 19 t;9Viac»ai iJ'4/47/ 34 How should the Ledger captions be written ? Ans. — In a simple but bold text. LEDGER. 15 <' 1 ■■iik m 35 I^ an entry has been made on the wrong side of a Ledger account, should it be erased ? Ans. — It should not, but the sanne amount must ' :• be entered on the opposite side of the same account " To "' or " By error, " and then the entry made as it should have been at first. 36 What is meant by Posting the Books ? Ans, — It is simply collecting and transferring each person's account from the Day-Bpok to its appropriate page in the Ledger. 37 In what order should Day-Book enl^'^s be posted? Ans. — They should be posted in the order in which they occurred. - v 38 When there is more than one item in the Day- Book transaction what expression is entered in the Ledger? . " '' ** ' Ans. — The amount should be entered with the expression " To " or " By Sundries. " 39 When there is but one item in the Day-Book transaction what should be entered in the Ledger ? Ans. — It is better to specify the item itself, r v 40 What is Index? ^^ Ans. — It is a formula from which we are enabled to turn directly to any account in the Ledg- 41 Describe the Formula ? • - ... ,j4n5.— It consists of several pages, being divided into lettered spaces, into which are entered the names of all Ledger accounts each being under its own special initial, and having its 16 INDEX. Ledger page attached thereto. i Rem. — The begbning pages of the Ledger are usuallj for thia purpose. Sometimes a whole page is allotted to one ioitiai and sometimes the single page is divided so as to contain seTeral^ as in the formula page 20. -'' 42 How many conditions are ih^re pertaining to f , Dealings with Persons on Credit ? Ans, — There are but two conditions, viz : that of owing^ and that of being owed, 43 What are these conditions as compared with each other ? Ana, — They are exact counterparts, and, so far as they are equal, cancel each other. 44 How may these opposits facts be b'ist ar- ranged ? Ans, — Under the names to which they pertain and in a way as not only the facts themselves, but their relative results may be ascertained at a glance. 45 What is such a form called ? Ana, — It is called an Accountt 46 How may it be defined ? iln^.— It is a statement of our dealings with an- other person or vice versa, 47 How many sides has an account ? Ans. — Two : a Debtor and a Creditor. 48 What is shown by the Debtor side ? Ana, — Upon the Debtor side is shown what is \ owing to us. i 49 What by the Creditor side ? ^ i: i Ana, — What is owing by us. f. 65 AOOOUKT. 17 allj lone to lo '{K> If the Debtor side be the larger, what will the difTerence express ? Ans. — It will express an amount belonging to us* 61 What if the Creditor side be the larger ? Jlns.-^The difference will express an amount which we owe. 53 What will the account represent in the former case ? What in the latter ? Ans,-^lt would represent property or resources, and in the latter a debt or a liability. 63 What is an indispensable requisit in any state- ment showing the business ? Ans. — Any statement showing the condition of business must embrase a list of its resources and liabilities, . . . 64 What is the sure test of superiority in a sys- tem of Book-Keeping ? Ans. — Any system which will enable us the more ^ cfasily to get at the resources and liabilities^ must— other things being equal — ^be the best system,')r-;. .. .\ .: .'' \^ " .' • 65 What class of BesoUTCeB is found in the Ledger ? iin5.»^-^Balances due from persons. 66 What, in the Cash-Book ? K iin^.—- Balance of Cash on hand. : » 57 What, ascertained only from inventory ? -: rn Ans. — ^The merchandise on hand. ' ' -- • • ' " >** 58 fjow are our Liabilities ascertained 9 'I iln9,-— From the Ledger accounts. 58 What is the rule for ascertaining the Present Worth oidk concern? > ''\ , * t -u^ ■00 Ui^ :. 3V 18 ilr-v- RESULTS. ft Ans, — To ascertain the Net Capital, or Present Worth, subtract the liabilities from the re- sources. 60 What, to ascertain the Gain during business ? Ans. — Subtract the Net Capital at commencing from the Net Capital at closing. 61 How must a change in business be marked ? Ans, — It is a settled principle in accounts that whenever any change in business occurs, " the existing resources and liabilities of tho concern should be made apparent. ^ , .^ 62 What do you conclude from this ? ' Ans, — That the proprietors' accounts should re- present their net investment at the time of the change, 63 At what periods in business is it proper to show the resources and liabilities. Ans. — At financial eras, such as the close of a fiscal year, or any other important event which makes it necessary to exhibit on the main books the exact condition of the busi- ness. ....... 64 Upon what grounds has Single Entry been Condemned? ^^ ^ u . . j ri tu j^iw^ ilns.-*-Upon the grounds that it is wholly inadi- quate to the demands of business, and there- fore unworthy of consideration. 65 Is the objection valid ? Ans. — It is not, as a very extensive business may be conducted with perfect safety, having no better record than that afforded by an intel- ligent and faithful application of the princi- ples of Single Entry Book-Keeping. / I;' . . . •■ S.t<.> mh.. .-. '.,» ^k i^ 5njj/,6irr— ,^;tk m I s : 1 INDEX. 19 J I B £ Ki^ ■*'■ ' .7., V' ' •; : K ■.■■:... Q H * 1 —I r* M • N i — :'•* '! •-•J w 5 *.♦ '. '" I I f b I'li. I % { /2em.— It is unnecessary to place all the formulas of rul- ing in- this book. A teacher who .values his time: and. that of his pupils will always provide them with properly ruled M' copies. *■■< '■M »t'>tf.t.*« 2*0 ' r 21 QQ CO M GQ P O O 8 . i I '»> > I ; •I i.^. « 525 O O w H o QQ H 5z; H OQ OQ O O o OQ O ?»'« 6 4<^ . ! $ 6q oo^ rHW •»i»"Wi"»l«»»" 22 MEMORANDtM. Jan. 3. Invested in Business, $2000 ; Paid Expenses to New-York, $37; Bought Merchandise, $1805; Paid Freight on Merchandise, $124.— 4. Bought Wood of Westfall, $8 ; Paid Postage, 35c ; Received for Mer- chandise Sold this day, $5.84.— 5* Paid for Sundries, $1..57; Paid for Sawing Wood, $3; Paid for Cartage, $1.75 ; Received for Sales this day, $4.92. Cash-Book. Dr. Cr. 1868 1 i Jan. To Stock 2,000 00 3 By Expenses \o New- York 37 00 • " Mdse. of Sund. Persons 1,805 00 " Freight on Merchandise 124 00 • 4 ^* Balance on hand * 2,000 00 34 00 2,000 00 ' To Balance brought down 31. 00 . . t By Wood from Westfall 8 00 " Postage '6^ To Mdse. Sales this day 5 84 .J j 5 By Balance on hand. • • 31 49 1 • 39 84 39 84 To Balance brought down 31 49 By Sundries 1 57 " Sawing Wood : 3 00 " Cartage 1 75 To Mdse. Sales this day 4 92 By Balance on hand 41 30 36 09 3(> 41 (This is to be continued by the student. See next page continuation ol memorandum.) OASII-BOOK. 2a 7 5 9 1 Jan. 6. Paid Advertising in Western Whig^ $3 ; Paid for Advertising in Wayne Co. Herald^ $3.50 ; Paid for Postage, 25c ; Received for Sales of Merchandise this day, $10.27.-7. Paid for Blank Book, $2.75 ; Paid for Merchandise, $5.86 ; Paid Postage, 30c. Received from Sales of Merchandise this day, $12.18.-8. Peid for Merchandise, $4*.74< ; Paid Express Charges, $1.25 ; Paid for Personal Expenses, $2 ; Paid Postage, 20c. Received for Merchandise sold this day, $11.74. — 10. Paid for Personal Expenses, $7 ; Paid for a Blank Book, 75c. Re- ceived for Merchandise Sales this day, $15.744. — U. Paid for a gal. of Camphene, 56c ; Parallel Rule, 50c ; Mer- chandise, $7.50. Received for Merchandise sold this day, $9.63— 12, Paid for Postage, 25c ; 1 Gross Gillott's Pens, $1.25 ; Merchandise Bought at Rochester, $25, Receiv- ed for Merchandise sold this day, $14«.55. — 13. Paid for a Bottle of Red Ink, 13c ; Hand-bills, $2. Received for Merchandise Sales this day, $12.64*. — 14. Paid for Re- pairing Blinds, $2.50 ; Wrapping Paper, $3 ; Postage, 10c ; Envelopes, 12c {Wafers, 10c. Received for Mer- chandise sold this day, $10.13. — 15* Paid for Express Charges, $1.50 ; Postage 15c. Received for Merchandise sold this day, $7.96.-17. Paid for Cartage, 25c, -000- e • ■%■■ • ' ! I. r> X '■-'"■ ■4 • -v' •,/ r#S .^ > 1. ' i. •; . . . ■ I." } '> ! i . . '. . ' ' ,.' ' ' ■• f ?' 1 w 2 li 3> An 6 Ai .*!^- 6 A . t1 1 QUESTIONS ON DOtJBLE ENTR BOOK-KEEPING. 000 — 1 Wh'^t is Book-Keeping t Ans — Book-Keeping is a faithful and systematic record of bu«titiess transactions. 2 In what do business transactions consist 7 Ans. — All business transactions consist in an exchange of values. 3 What hat; Book-Keeping to do with exchange of values ? Ans," h is the science by which these exchanges are recorded and their results shown. 4 How nnaiiy methods of Book-Keeping are there 9 ilii«.-— There are two : Single and Double Entry. 5 Which is the better method ? Why ? Ans,^ Double Entry ^ on account of its better facilities for developing results. 6 What is the characteristic feature of Double Entiy9 Ans^ — It consists in the entering of each trans- aciion into ttoo or more Ledger accounts. 7 Why must each transaction be entered into two or more Ledger accounts ? Notes— -The object of the black type ie simply to indioate tho subject. The quentions to which the continuous nuinberi art attached are intended as initiatory ; those in small prUnt should not be studied before the student is thoroughly Mqotinted with the initiatory put' immm -.^ n vBOO^IC^BPIKQ. j^5. — Because two or more persons (or things) are affeclfid ihereby. 8 What are the lhr<^e main books used in Double Entry ? Ans. — They are the Day Book, Journal, and Ledger. 9 Describe 1 he Pay-Book? .. AVfS' — I' is 'he hook of origi>ial entry, and con- tains a consecutive hisioiy of all 'h^ Iraiis- actions in ihe dale and order of their occur- rence. ' • . • •; • • I i • ' • f ■ ^ *, * 10 What should be the character of the Day Book expressions? Ans. — They should be plain, concise, and unequi- vocal. . !' (1) Why is the Day Book alone produced in Court t ^ A^ltS* — In as mucii as the records in ibi'* book are sup- posed to be in.td^ wliiMi HiH transactions and all the cireuinsiances connected thrrewiih are fresh in the rtiind. . — • »i - (2) What other irnportanoe has it t • ; • iftns. — It is tht: basis of ail the results shown by the other * books. . \- : tLv (1^) From what sources do Day- Book entries rqme ? AnS' — ^Few transactions appear Cir^l in the Day-Boi'k, f but are from various sources, viz , Inrpic^ ;Book, Sales-Book, Cash-Book, Bill-Book, Jiv. ) h'.; 11 What is the special use of the Joumal;? 4iM*'7r>It8 special use is to decide qpQn.|^J[^e \ proper debits and cfedita, myQiy9d iiiiti| Dny Book in Journal form Over thf Hi>toric«l Day Book 1 .-J» ^:',vr^r ,•or^ Ans. — Th>, < lii» f udvantrtgp."* are, in dispensing with a se- .'V parate Jonnal, ami in bringing the Day-Book and Jouiiml tiilrits togetluT tlie brtler to identify them. (2) What objection can be urged against it ? Ans. — The only objertion is the diffienlty of making the enlry iutelligible as well as syiniiietrical. (3) Did the Jotiinal come into qse with the Day >Book and i-iedger ' ' •• ••*.'. Ans. — It did not, but was afterwards introduced to aid those who coidd tfOt perform its labor mentally. (4') Is the term *' Simtlries '' used as a Ledger account T Ans. — No, it is never used as a Ledger account. (5) For what purpose then is it u^ed ? Ans. — It is used merely as a caption for the Journal entry, indicating that the entry consists of sundry debits and sundry credits* (6) How will its convenience be most apparent ? ^ns* — la porting to the Ledger, as it affords tn exprtt* ftion to be entered under the Ledger tKI^. >>/. 1l fs iouii^AL. (7) How manj kinds of Journal entries are there t Jln5.-— There are renilj four kinds of Journal entries^ eacb requiring a different expression. (8) Name the first 1 Ans. — Those consisting of one debit and one credit. (9) Name the second 1 Ans, — Those consisting of one debit and several credits. (10) What is the ihird ? Ans» — Those consisting of several debits and one credit. (11) What is the fourth 1 Ans, — Those consisting of several debits and several credits. (12) Why is the word creditor (Cr) never seen in the Journal ? Ans, — For the reason that the word debtor (Dr) dis- tinguishes the debtois ; and theie beirg only two kinds, one being bhowny the others must of course be creditors, : ,v t p3) Can special books of entry be so used as to dispense with the Journall ';• a" Ans, — Yes, each of the auxiliary books may be so kept as to po»t thence to the Ledger. — (See Economical Method, page ) ' ",■ ' ■' ' ■ •;> 14 What 18 the character of the Ledger ? An$, — Its character is 9uch that all the other books are subservient to it. 15 What are shown in the Ledger ? Ans* — In the Ledger are shown the results of all the transactions^ arranged under distinct heads called accounts. 1*. r )^-\- LIDGIB. 20 t. le is- ro be se Pt al 3[ f (1) What grand division d« you make of the Ledger in reference to debit and credit 1 / Ans. — Ail the sums on the credit side of an account in the Ledger, are sums that the concern ow6s, and those on the debit, ar^ sums owned to the concern. It is only the balance or difference, which is to bt paid. (2) How do you divide a Ledger for use ? Ans.^In opening; accounts on the Ledger, we give to each a certain space according to the business that We thii»k we may have wiih tlie person or property ; and we g**nerally l^ave some forty and fifty of the beginning pages of the Ledger, for private accounts, such as Ca>l), Merchandise, Bill» Receivable, Bills Payable, Loss and Gain, Interest, ComroisMon, &c« 16 In what do AuxQiary Books consist ? iln«.— .They consist principally in giving a detail of some of ihe Ledger accounts. 17 Upon what does the character of these books depend ? Ans. — Upon the amount and kind of information # required. 18 Mention some of the Auxiliary Books ? Ans. — The Casjh-Book, Biii-Book, Invoice-Book^ f Saie!$-Book, &c.) &c. 11 it (1) Which are the most essential ? iln5.— The Casb-Book and Bill-Book. .'T • V: 19 For what purpose is the Cash-Book used ? Ans,— h is Used to give a detail of ail cash ceived and all eash disbursed. 1 80. CASQ^OOK* (1) How^often is the Cash-Book closed ? . - Ans.—T\ie Cash-Book is closed at tae end of evefjr, bus- in* ssdiy. (3-) With what must the difference between the sides agree ? Jinx. — It must aaree with the cash items on hand. . , (3) \Vh;»l is done willi ihis (liffVrt'Uce ? Ans. — ^Jt is brought down as a basij^ for the next dayV bu.sirieMS. (3) Wlrtt is ihe advantnge of this Hoily tost ? Ans. — It is the best safeguard agaiii>t tf ror^ and omissions. ••»; . ) 20 Of what importance is Uie Bill Book ? A71S. Ii ii* ^^pecially iinporumt ifi Ive'-pirfg the amount an I ooiid.'iioif ul' noips pay ibie ; and should fit'V(^r he omitU'-i in any bu-^mt'sx dt^al- iiiij.s vViiti aok'ie, payable or rectdvuble. n) With wliHt atconTtt in ihe L-'dger will the uncanc(l to show whatever regards - goods sold oil our own ao-ouni, or for an- other person's accoum, or for ourselves anfl others in Co. . ,» ,. , ., .. , .• ^y ^7^ Rem. --A commission Sales-Book is generallj kept separate. ■?'»' >-' < '} SijrJ-iyjiui; i-? m an? f^*?-' -a-sg •I T'AI I ' (1) "When fhoultl entries be made in the Tnroice Book ? -4w5.-* At die limn the goods are received, the invoice, or bill of thj'm, should be copied into this book. (2) When are entries made in the Sales-Book ? Atis. — At the time the goods are .^elected or ordered hf the pur< hast'r, they should be described by the quan* titj, qualify, and price. (3) How and wh«^n do yon take entries from the Invoice or Sale^. Books to the Day- Book ] Ans — Siiiglf purchases anl sales may be carried to the Day-Book separately if they are of large amounts or we may, with propriety, convey the punhases of a mo'iih or a wp»k fiom the Invoice Book to the Day Book ill only one entry, and from the Sales-Book to the same manner. ^ i. .wii i.i^»/r'jdi V t. 23 How are the terms Debit and Credit used? Ans.--^ They are contradisirnctive, and are used to (hrnote the relation in which persons, properly, &c., stand to the business. . 24 What is a sure condition of debits and credits ? Ans.— In every transaction, the sum of the debits aud the sum of the credits must be (?quai. • r n lirVOIOlBOOK. ii 1 1 Rem. — The common definition of the word debtor, ii the person that owes ; but in Book-Keeping:, the definition it the person, partjr, object, or cause which owes us. Tbe common definition o( creditor is the person who is owed ; but in this science it is the person, party, object or cause which we owe. JNbte, — It is rery necessary to understand thoroughly the eiact use and import of the word^ debtor and creditor , because the most important part of this science consists in being able to find with facility ** who or what owes U8, '* and ** to what or whom we owe, " in all mercantile transactions. 25 What is an Account ? Ans, — Every person, species of property, or cause producing a debit or credit, is designated by a name, which appear? upon the Ledger, and IS known as an account. 26 How many sides has an account ? Name them*^ Ans. — Two : debit and credit. 27 Which is the debit side ? Ans. — The left hand side. 28 Which is the credit side ? Ans. — The right hand side. 29 What is an account current ? Ans. — It is a statement intended to explain to the person to whom it is rendered, how his ac- count stands in our books and to show what balance is due him or us. 80 Into how many classes may accounts be di- vided? Ans. — Into two : Real and Representative. 81 What in a Beal Account ? ** ^ §■ * ;■«• i lit Id 9 id I I ^^' 9MJLL ACCOUNT. Ans,' — It is one that shows a resource or a liabil- 32 Mention some Real accounts ? Ans —Cash, Bills' Receivable, Kills Payable. Personal accounts, &c. . . i 33 What is a Bepresentative Account? j Ai 3. — Ii is oiie ihal shows a loss or a gain. 34 Name some Representative accounts? ^» Ana. — Merchandise, Expense, Real Estate, &c. 35 What is m^ant by the term Cash ? Ans. — Cash h the title to designate money, 36 With what is the Cash account debited ? Ans. — The Cash account is debited with all re- ceipts of money. 38 With what is it credited ? Ans. — It is credited with all disbursements. 39 What is shown by the dillerence between the i sides? .'• Ans. — The difference must, at any time,show a resource of the ^xact amount oJt cash on hand. Rem. — By an error, it may show otherwise. .^ i 40 Why cannot the Credit side of cash be the greater? Ans, — Because more cash cannot be paid out, than has been received. (1) How is this account closed ? Ans, — By Balance^ and it must not be closed otherwise. f ^^|i41 What is meant by Bills BebeivaUe? J"- BILL8 RXOEITABLl, 4|I9. — They are written obligations in our pos- ''' session, for which a specified amount is to b6 received. — 42 With wliat is Bills Receivable account dth- ited ? Ans." It is debited with other persons notes received. * , 43 With whf.t is it credited? Ans. — It is credited with other persons notes dis- posed q/*, or in any manner cancelled. , ; 44 What does the difTerence show ? .oi.>.* Ans. — The difference (If any) irm.st be on thf' debit side, and will show our resources consisling in notes. (1) What fthouidwe do when notes becomti due and re- main unpaiii 1 • '•^- Ans. — We >houltl charg»» iheir amounts to ih^lr drawers, or tbosf who ouglit to \y.\y them ; for it is then that the parti^-s owf u>, ;. .. . ^^. ,,.._.♦;, Rem. — Before the notes were due, we could demand nothing of ihe persons; the notes alone were responsible, but after the parties owe and may be sued. --:..; (2) How ihis account closed? t. , ••?< ^% Ans, — By Balance, for the difference. If the notes be ail itasfced away, it is evident the account will balance. - / - - . >- ->i.v vi- 45 Whatsis meant by Bills Payable ? iln«. — They are written obligaiinns by which we are liable to pay a specified amount. 46 WJiat does the Credit side of Bills Payable show ? I BILLS PATABLfl. Ann, — It shows all our notes and issued. 47 What (lops the debti side show? irf^* ^ Ans. — It >h()\vsj all our nolfs and acceptances redeemed. 48 VVhai is siliown by the diflerencn ? Ans. — The dill^rtMxe (if any) mu!:?i exhibit our *^'* unri'dt'eimd noti's. :. -,» 49 How is this aeconnf closed ? " ' Ans, — It is closed To Balance for the difference. Keim. — It shonki be borne in mind thai notes, like caffh» ought always- to bf, d»-bUe(t and credited with the valu« wriiien upon th* m. (f tli'»y are really worth more or lest tlian tills expressed value, that difleience mufit be sho^tt in some other account. \ (1) Willi t is menni by the term Mortgage Payable '/ Ans — It !«» anotln-r namt» for BjMs PiiyHhle : ibt? accounts (MoftgHiie P;iyabl«' ortd Bills Payable) in;iy be kepi j| sepaiate or together. (2) Whit is ilie diflVrrnee in effect between s Mart" gagp Payable ;urwnii*s«>iy note ; whereat the Mottgap^e Paycd^Jt i> » transter of property to s»c»Me »ht p.>)jU' III o\ [i debit. (3) AVhui i< ihe ihul .iitii* utiy in exphuning the debit dindi credit ol Intel e.>t iu<'-tii:l i Ans. *^ It i» 'ht wiiit of a tiioroiigh iitid<*rsfonding of tht term mlerf st. ^4) (rm I hi' prnp»'r rhfmition of the term interest, aS em- ployed in Ihc lii(eiel ;m rount. Atis, — Interest is the use of money XdX\i»x i\Mii ikL^pre" mium paid for the u&e. Z- H HBBOHANDIBt. 60 What \9 ii!«nally implipd by the term Mer- chandise ? Ans. - It usnully implies all property purchased crowned by the eoncern, lor the purpose of traffic, and remaining in store, 61 What exceptions are there to this general rule ? Ans. — The merchant to know his gains or losses on a particular kind Mometirnes opens a se- parate account under its oivn special title. 53 What does the debit side of Merchandise show ? Ans, — It shows what Merchandise has cost the ^— « concern. 64 What does the credit side show ? Ans, — It sht)Ws what Mt-rchanilise has produced. 55 What does the diffiTencr show ? Ans, — When inventories have been credited, it must show Bi loss or a giin, (1) In bow many ways in M^rchanHisft account closed ? ' Ans.-^ln three Wi>ys, depending upon the following cir- cum^tancefi : when all the merchandise if!» sold, whea part i^ sold and part remaining unsold, and \asVj when none is sold. (2) How is it closed when all the merchandise it i!>oid ? Ans, — It is closed To or By Loss and Gain for the loss or gain, and transftr tlii . Ant, — The account is first credited By Balance for the amount of goods unsold then debittid or credited. To ■ or By Loss and Gain, ^ r- >f I 37 (4) How w it closed when none \% sold ? Ans. — Th«» aToimt i« credited By Balance for the nmoiint of the debit «ide. (5) What is mf'ant by Real Estate ? Ans. — This relates to {"iioh property as houses, lands, &>c. (6) How is the ac siniiljir lo Menhandiset Ans. — In <-is much ha Stock'* of all kinds are boug;ht and sold at th»fir market value, rather than the value written on their face. (8) What is the distinction between a Bank account and a B.ink Stock account ? Ans. — Thn first is treati d as a pprsonal account ; where- as the other is treated as a Merchandise account. (9) What is meant by Shipment or AdventUTet Ans. — It is property sent away to be sold by an agent for us. (10) With what is such an account debited t 'Ans. — It is debited with its entire cost. (11) With what is it credited? -' Ans. — It is credited with its proceeds. ' ^ (12) What does the difference show 7 Ans. — It »hows a loss or a gain. (13) Wherein does such an account differ from Mer- chandise. Ans. — In as much as it distinguishes between property in store and out of store — it is another name for Merchandise. (14) What is a Consignment account t ilns.—- It is an account used to show the facta conneeted with tiie tale of consignor'a property. 88 OONSIGNMBNT AOOOUMT. (15) What dof»« the debit side of such an account show? Ans. — Ii >ljowsoiir cliii>j»«'>, &«!., H;»Hinsr tlie consignment. (16) What does ili*' credit >iw« what the crmsionn»*nf h^iJ* produced. (.17) Should thi*. ;»uch an entry affVcl \h'\ ' * Ans. — It would render us liable (on our book^) for the pro- perty couj»igi«ed us. (19) Wh»n th** propt^rty represented in the consignment account is di>j»osed of, why do you cancel the account 1 Ans. — Wf do >o, in order to fojward iht* proceeds, which must b*^ the difference b« fwignees, fur the suie of paiticular consignments. *? (21) In what particulars does this species of copartnership differ from general copa^tll^ i^hip ? Ans — It t'jfft'is oii'y ill xh*' duration of eopaitnership, and in \\w. manner of conducliiii' its sales. (22; Show ihJH mort* explicitly ? « Ans, — In Men he couipmiies, one of liie prrtuers (the consignee) is Ihe coiumii^ion mi chant, and, ID that capacity, receives and disposes of the proper- ty IS be would of ^ simple consigQmeDt ; the only •I Jk, X jJUpmi i] 1 1: I : 1 : r- KKROHANDISfi 00. AOCOUNTB. t tiCi difference being that he is interested in the gains and losses. .... •,.-,. -r, (23) Is ihe rPi»nn^r of conducting these Merchandise com- pMnif-s Uiiifuriii ? , Ans.—^o : ihere J«re two methods. c (24) What principle is recognized in the ^/s/ wzc^/ioc?? Ans. — Thn holder of the properly is res-pousiblc for lh« Men hamiis*'. (25) What in ihe second? ' ' -4^75. — The owner of the property is responsible. ^'\ (26) Give an illustration of < lie y?/-s^ we^/ia'/? - ' Ans. — When we receive from N— — , an invoice to be sold on joint account, wh debit •* Mdse. Co. A. " wiih ihe - ' invoice and expense},, and credit the coa«iignors with the cost of the invoice, ihtis nicikmg ourselves res- pon-ih'n for the pioj»erty, as though it were ull our V own. fa"! ., ^ Rem. — Th«' property shipped is supposed to come frdin ,,j, the consigner's own resources, (27) IHustrato the second method ? Ans. — When we rective from N , Merchandise to . , be sold on joint account, we debit " Mdse. Co. B. " ^.,,^ wilh our own share only, and credit the consignor. [h'\ (28) By iiit^ Jifst m.fthod when n»ore than two parties are interested, what entry should the coj^Mgnee niuke oa (rt) What woultl be the consignor's entry, if recognizing the same printiple ? To ^f6z7 us wilh lh»' entire cost of the Merchandise. (h) Whil would be the con«>ignor's entry in this case ? Ans, — If made lo correspond with ours, it would be to debit us with our share, and Shipment in Co. to , [|plac« 'Of our business J for bii share. 40 HiaOHANDIBl 00. AOOOUMTS. the receipt of the property to be sold OD joint tc- count ? Ans. — The consignee should, as before, debit Mdse. Co* account with its entire co.st — iuvnice and (•xpeiiHes — and credit the consignor with their [^ihe con- signee's and consignorV] joint i-hiire and any other party or parties with his or iheir share, [c', «?]. (29) By the second mefJwd when three or more parties are inteffsteil, wliit ^ntry will the consignee make on receiving properly to be sold on joint account ? Ans. — The consignee .should dt-bit '* Mtlse. Co." account for his own share an«l ail the charges, and credit the consignor for his [the consignee's share.] fe, /"]. (30) When is the consignee considered responsible by tht; first method ? Ant, — He becomes responsibU for the property when he receives the consignment. J (c) What would be the consignor's entry upon shipping the properly ? Ans. — The consignor would, in such a case, debit the con- signee with their joint share, and each of the other parties with bis or their share* (rf; What the other parties ? Ans, — The other parties would, if making an entry to cor- respond, debit the consignee and credit the consignor each for his own share. (e) What the consignor ? Ans, — He should debit each of the parties for their res- pective shaies, and *< Shi|)ment in Co" for bis owa share. (/) What the other parties ? Ans. — Each of the other parties shoiild debit " Shipment in Co. " and credit the consignor each for bis owd sbtre. s ■ ;-4 1 'Mk ■ ^m MBBOHANDISB 00. AOOOUMTS. 41 ji •:f t (31) When bj the second ? Ans, — As soon as he has disposed of the consignment. Rem, The final result is the same in either case. ( (32) Which method is absolutely correct ? Ans. — So far as absolute right and responsibility are con- cerned, the second method is the correct and philoso- phical one — the principle recogrnised, being that the ot^/z^ of the property is responsible. , , ,; (33) What advantage has the first method 7 ^ Ans. — The only advantage possessed by the first method is, that the ** Mdse. Co. " account shows its entire . ' cost at the commencement. (34) Arc *< Mdse. Co. ^' accounts to be classified as Real or as Representative? i . , ; Ans. — In their current condition they aire neither Real nor Representative. * i • .. ♦. ■ ' (35) How may they be made Real ? Ans. — Thus, by debiting them with all the cost, and our share of ih** gain — [or, crediting them with our ^hare of the loss] the dift^renre will represent what we owe to the parlies interested — the account thus Jiecomes Real. T ,,,.. r , (36) How may they be made Representative ? Ans. — By debiting them with all the cost and the gains of the other parties [or crediting with the loss of the other parties], the difterence will represent our gain or loss, and the account thus becomes Rt'pre^^ntative. (37) What ignors, &c., for the sate-keeping of their property, and advertising the Public of the sales of the same. * For this reason, it is better to close them by a Journid entryi when the property they represent it ditpoied of. 41 COHMISSION AOOOUIVT. (38) What by Commission account ? Ans. — An arconni kfpt of ih« allow«»ncp« madft us by con- signors &c., in rompen^ation for our Ironble in selU ing lh»;ir properly, usually at so ujutli per cent. ^^ (39) In whit pailicMilar does a merchant'* " Private ac- «onnt " diflVr from his *' Siock aeconnt ? " Ans. — Tn this, that ihe " Private account " shows him, ' in one amount, what he has dr^iWii from the business for liJH own private ur<% which amount cannot be read- ily had from " Stock. 5> 56 VVhai are Personal Accounts ? yins. — V\o.c(»unis rcpro^entlnty personal inflrblcd- nesVs, and (JoignaioH by iht* proper name's of s»j(^h per-ons as snstain relation of debtor and creditor to the concorn. »* • < '- "• * 67 VVliat fjoes ihe debit side of such an account 8how? ' Ans. — It {shows our account against him or them. 58 What, the credit side I :• ; , Ans. — It shows therr account against us. 59 VVhai is ^hown by the difference? Ans. — It shows a resource or a liability, "v 60 Do(»s the term Stock as a Ledger account relate lo a special kind of properly ? Ans. — It does not relate to any properly. 61 To what then ? ' ■ -vri*' • • '^ < ■ ^' i^^ Q Ans. — It represents simply the proprietor of the busmess, or the stock-holder. '""" ."^ ^''^ '^" #*> T { "-.i^r^t.. I* ^0 \ K.' ' """i~, ' (1) Would there be any valid objection to using the pro- prietors name instead ? i account during the bu?i- ness 'f ' - ^ » • ,. Ans.- It '*< not, exct'jit for the juirpose of recording sub- SpqiK ni i«)»t'slin<'nfs. ■ ' . . - / • (2) Woui'l it bf^ philosophically correct to credit this account wiih the gams as r)ften as ih^j occur, and convnst ly ] ' Ans. — l* would be correct ; but is attended with many difiicultieh which are overcome by the Ubual method. ' ff. "- nr'^' •JV. .«*. ^ * * ' -. ^ ; . '. , > , I'- i t i -000 'vj ^|{? #'^>. ii,- ■; .f > - .'/ i. ; < j^;,i'.-'. r/ mw Principles. K^'^Olv ^,^ 66 With what phoiild the Proprietor of the business be crediied ? -^ -■ . An8» — Th(» person or persons investing in busi- ness should be crediied. under some title, for such invesitne>i)is, and also for his or their share of the gains. 66 With what debited ? " *^ Ans. — He or they should be debited for all liabi- lities assumed by the concern for him or them, for all sum-^ withdrawn from the busi- ness by him or them, and tor such losses as be or they are entitled to share. 67 With what should the Cash Account be debited 9 Ans, — It should be debited for all cash receipts. 68 For what credited ? Ans, — It should be credited for all disbursements. Ill 69 With what should the Merchandise Ac« count he debited 9 Ans. — The Merchandise Account (and all ac- counts similar to Mdse.) shoaid be debited for the cost of the property. Hr^ Hiiii m^^f^mm rRt^dt^Lttl 46 r. 70 With what credited ? Am.—li should be credited with its proceeds. IV 71 When should Bills Eeccivable Account be debited ? ^u,.— It should be debited with other people*8 notes, acceptances, and other written obliga- tions when they become ours, v 72 When credited? jIjis, — Tbey should be credited when they are paid, or otherwise disposed of. ^>s ' ..' 78 How should causes producing us valuC) be treated? -''' "^^ ^nff. - All causes, of whatever kind, producing us valup, should b«* credited uiuler some name, f(»r the amouiii th<.s produced. Rem. — The fougoinor principles are ai! embraced in tbe loiinwiiifi^ simple foniiula. 79 Repeal the General rormula for debits and crf(iiis ? ,,, . ..T . . . , ;^ Ans. — Debit what costs the concern value, aud Credit what produces the concern value. Rem. 1 — Ner^T permit th*» mere rircnmstance of rtf- .ceiviTtg or delivering fo ilivert the attention from the true and only pi Helical rule — the General Formula for debits and credits. ' ' ^'^ - ;. vi.> jjuv 2. — There are various trnnsaftion«s in which the object tb:^! is received is not our debLor^ aud ihal which is deliV' ered is not our creditor, ^ ^ , , , 3. — Tbe old rule can nerer be applied to iaterest| without making a wrong entry. r- - . - rr. ' t-^ \J . A .a '000' ♦ . \ ^l .^r:v,4-rp*t 'ih:>V-'- ^^: :HMn If' . Goasral Instructions '/S.I <:; i-.i.*.;..;;, 'i I, ^m^*' 80 ^^ ^ly i^bnnlfl the pinffont keep the Ledger «n vJHw, wh^n journaHzinsi;^ n .» 'i; I jlrw. ■ Be(!H(ise the process of jojirnalizing ii^ sirpp- , ioJy at one place and in one book — J he LeHgtT. • (2) How often should books be posted ? -4/15— 'D<«i'j. w+'fk^7, or monthly, according to thie nature of the bubiness. Why is it nepffssary, to observe cafe , in .p(>|9t- mg ;i«*.v» iUI ,^|j«.----Becaiise err6i:s must all be found and,cor^ rected before we can proceed — ejrc(^jf«^fijje 48 OlNlftAL XNBTBUOTlOlfl. more easily avoided than detected* 84 What is the first account opened in the Ledger? , Ans. — It is customary and proper always to open Stock or Partners as the first account. * 85 When an account is posted to the Ledger what expression should be made? ^ r "^ J^ns. — The oppi)site Journal entry expression. 86 la it necessary that an^/ expression be made ? Ans. — It is not really necessary, as the fact is expressed by \he figures. Rem.— The expreppion, vrhen properly made, is suggei- tive of the transaction^ and hence is seldom if ever omiUed by accountants. (1) Illustrate the process of Posting ? Ans. — Suppose the Journal entry be Ca*h Dr. to Mer- chandise, $1000. Turn tu the debtor side of the Ca^h Arrount in the Ledger, enter in ihe column!» for thai purpose the date, Journal page and sum, and write, ** To Menhandise ; " then turn to the creditor side of Merrhindise, where you enter the same par- ticulars as before, and wiit«», '' By Cafh " thrn en- ter the ledger pages of Cabh and Merchandise oppo- site these respective titles in the Journal, whicb will serve as post marks. 78 Where should the Page of the Ledger to * Some houses, desiring to keep the particular interests of the partners, or the conditions of the copartnership from the public, or from the knowledge of any parties exttej^ themselves, keep a private Stock Ledger, to which even the book-keeper has no access. In such cases tiie books «re kept as Stock-books, with but one account tQ reprdlent tiki oaj^itat. THE PAQS OF THE LEDGER. 49 'I'v., whioh an amount is posted be entered in the Journal ? Ans. — Ft should be placod in the column at the left of the account and directly opposite its entry. '1 - , 79 When? . -^ .^^ v.i%:^/'^ • - . i Ans. — Immediately after the amount is entered in the LeJge^ but never before. * 80 Why is the Trial Balance so called ? *' Ans. — Because it is a trial to ascertain if the debits and credits are equal or balance. (I) How often is necessary to ninke a Trial Eatanc^? Ans, — MofHhIy or quarterly, sometimes it is left until tli^ end of the year when it rarely balances. r 81 Does the " Trial Balance " prove the Ledger to be absolutely correct? Ans. — It does nut prove the Ledger to be ab- >» solutely correct. 82 Why? . - » *^^\ ! Ans. — For the reason that there are many cir- cumstances under which the Ledger may balance, and yet be wrong. ^,,_^- 83 Is the /fcs^ afforded by the Trial Balance 77 usually satisfactory? •«..'. * This instniciii)ti will, of course, apply only to cases / where the post-mark is used also as a checkmark. It is cus- />4> tomary with gome accourilaiits, in ord^r lo facilitate the latior of posliria:, to enter opposite the Journal entries, be- fore postingn ihe page of the Ledger to which each entry is to be posted ; and lo indicate ihe ^ac^ of posting by an additional post-mark. In this case, of course, the check' mark and not the Ledger page, is subject the above res* triction. &0 TRIAL BALANOI. >'. Ana. — Under ordinary circumstances, it may be considered satisfactory. 84 How do you prove that all the Journal en- tries have been polled ? Ans. — By observing if the total footings of the Ledger exactly agree with those of the Journ- al, which could rarely be the case if any of the Journal entries were omitted to be posted. y 85 How do you prove that all the origina' "entries have been journalized ? Ans. — By having the total footings of the Day- Book to agree exactly with that of the - Journal. 86 When these precautions are taken, how many chances are there for errors which may es- cape the Trial Balance test ? , Ans. — There are two chances for errors in the ac- counts, viz : from improper Journal entries, and from posting to the wrong accAints in the Ledger. 87 Can a correct Trial Balance be had which will contain simply the difTerences of the Ledger accounts ? Ans, — It can, and quite as satisfactory as the other. 88 Upon what principle is this affected? ns. — On the principle of cancellation. 9 Are these two forms of the Trial Balance ever combined in one? Ans. — They are, and accountants have found it very convenient to combine them. Rem, — It is never proper to leave the Trial Balance ^ be TBIAL BALANOI. 51 io th RESOURCES. 94 How is ihe real value of such property as- certained ? Ans.— \{ can be kncfwn only by actual appraisal. 95 What will the difl'erence in the sides of the Merchandise account show, if debited and credited wilh the same value ? -^ Ans. — It Viill show the value of that remaining unsold, reckoning it at cost price. - 96 When ihe Merchandise account is debited ■with ihc cost of merchandise, and credited with tho proceeds, how much will the dif- ference between ihe two sides fail of showing the value of ihe merchandise unsold? ^n^.— The difference will fail to represent the amount on band in the exact amounrt of ihe discrepancy between the cost and the pro- ceeds from sales. 7 When, the account is so kept, what is our only method of ascertaining the value of the merchandise unsold r Ans, — It is to go up to the shelves and estimate it by actual inspection. 98 What is the process called ? Ana. — *' Taking an Inventory" or "taking an account of stock. " 99 If ihe net cost * of merchandise exceed the ■^ • This phrase may not seem, at first view, properly sig- nificant ; but we apprehend that it is truthful neverthe- less. For, although it may not be true that the tiifference between the cost of rnercliandise and proceeds of a certain portion sold exhibits the net-cost of that with remains un- sold, yet that difference does express what we lack, so far, in receiving as much as we have paid for merchandise; BESOURCEt^. 53 value of ihe merchandise unsold, will the account show a gain or a loss ? Ana. — It will show a loss. 100 When the real condition of a concern is stated, what must ii exhibit ? Ans, — It must exhibit equal resources and liabit- ities. 101 For what purpose is the " Stock account ^^ opened ? Ans. — For the purpose of showing the net cap- ital or investment. 102 Why does not the " Stock account ** per- g^ pelually represent the net investment ? Ans. — Because the capital or investment fluctu* ates in value during the busine:«s. v^ 103 Why is it necessary to '' close up ** the Ledger accounts. Ans.— In oT'ler to restore the " Stock account** to its normal condition by the balanqeis of resources and liabilities. ;:Gv-; -* f> /♦ * / ^ therefore, Ve sny it has really cost us the difference. If this amount ^iioiild expresH the cost over proceeds, tuiih the property nil ru^«e^ of, it would represent a loss; but as there is yel actuHr '^tokie in that which remains unsold, we dan safely anticipate further proceeds equal to that value. When this is shown, the difference between tvie cost and returns will be the gain or los$. mm I Closing the Ledger I >■' 104 What is the chief difficulty with learners in closing the Ledger ? Ans. — It is to understand clearly the object to h^ attained by " closing the Ledger." 105 What is the effect of " closing up " an ac- count ? X Ans, — It is to put an end to its current condi- tion. ; . , ./i 106 How is a Reed account closed when ths sides are equal ? v Ana. — It is necessary only to add up the two sidesi and draw red lines underneath the amounts of each — it is then as though it never existed. 107 How, when unequal ? Ana* — We enter upon the sniaUer side, in red ink, an amount which makes it equal to the larger side — the exrf^ss will be either a resource or a liability. 108 How is a Representative account closed when the sides are equal ? Ana, — When the proceeds are shown, ii is also closed by adding up the crtulit and debit columns and drawing red lines underneath. 109 How is a Represenlive account closed when the sides are unequal ? ylfw.— If unequal the excess will be entered on the smaller side in red ink, and will repre* sent a gain or a loaa. r&opftiBTOKs iN^mtsftrt dft HO At what stage of the business does " Stock " account ceased to represent the Proprietor's Interest ? Jins» — Just as soon as the invested capital begins to fluctuate or change in value. 111 Why is this? ,.,1. - . Ans, — This is simply because the gains and loss- es are not carried to the. ** Stock" account - when they occur^ but are allowed to remain in the Representative accounts. 112 How can we, at any time, ascertain the pro- prietor's interest or what the concern is ow» ing him? ^ns. — 6y taking the gains and losses from hi? Representative accounts, and carrying thein to the '* Stock account. '* 113 How is this done ? Ans. — By " closing up " the accounts and trans'^ ferring their balances. ,...,. • 114 What is the usual method of carrying gains and losses to the " Stock " account ? Aji8, — The usual method is to open a general account called *'• Loss and Gain " and trans- fer to it all gains and losses. 115 What is the advantage of opening a LOM and Gain Aceonnt ? An«.— It is that we are thus enabled, the more easily, to get the net gain or net iossjin one amount, which we carry to Stock. J16 To \vhich side of " Slock " account are gains carried, and how do they affect that ac- rpunt? ^ LOSS AND GAIN AOGOUNT. 'Aris, — ^If it be a net gain, it will go to the credit :. side of the account, thereby increasing the investment. - - ., . . H7 To which side are losses carried, and how do they affect the account ? ' Ans. — If a loss, to the debit side, decreasing the investment. ' •-^ . US Can the gains and losses be thus disposed of, without disturbing the Real accounts ? Ans, — Yes, they can be disposed of without dis- turbing the others. , - .-.-»• 119 What is the object of opening a Balance Account? ' Ans. — To show, in a tabular fornn, the resources and liabilities of the concern — this is done* by closing the Real accounts into it. 120 How can we dispose of the amounts prop- erly carried to the " Balance " account, if we wish merely to shov; an era in our business ? Ans. — By closing up the Real accounts and bring down the balances. .,..,. 1^ What is the main object in closing the Ledger accounts ? >liw»— It is to restore the proprietor's account to the same relative position towards the busi- , . ness, which it occupied at the commencement showing the net investment. 122 What does an Entry in Red Ink on the Ledger denote ? Ans.p^\i denotes that the amount thus written is to be transferred^ either to some other ac- RED INK ENTRIES. 57 count, or to another position under the same account. • .» . n > v • 123 What else does an entity in red ink denote ? Ans. — It also shows that the entry is first made in the Ledger, nor having passed through the usual preliminary books ot entry. " 124 How are red ink entries always transferred ? Ans» — They are always transferred to the opposite side from wiiere they fir>3t appear. 125 Why, trau. Tjrred \o \he opposite side} Ans, — For the reason that they indicate an excess on that side. - . , .. , { . -000" • » : r * -r* Order of closing 126 What is the jirst Step in closing the Ledger? , Ans. — To open an account with " Loss and Gain " (if not already opened), and another . - with *' Balance. " 127 What results are shown by the '*Loss and Gain " account ? ' Ans.--rThe losses and gains are shown. 12$ VVhat, by the '/Balance " account? A»8. — The resources and liabilities, ial What is the Second Step ? OBDXR OF CLOSING. Ana, — It is to ascertain from the inventory if any property remains unsold; and, if so, credit each account for which such property was originally debited with the value of that unsold. 180 How is this entry made ? An8» — It is made in red ink, " By Balance, '* and the amount transferred directly to the debit side of the " Balance " account, making the entry in black ink^ *' To Merchandise, ' or ** To Real Estate, " or any other account from which the amount is translerred. 131 When the inventories are placed to their proper accounts, what will be shown by the Ledger ^ An$. — The Ledger accounts will each show, now, one of the four following results, viz : a Resource, a Liability, a Gain or a Loss. 132 What is the Third Step ? Ana, — Omitting Stock account (or Partners' ac- counts) commence with the first account in the Ledger. First ascertain wliich of the above results it shows, making the closing entry ac- cordingly. If the difference represent a re- source, or a liability, enter upon the smaller side, in red ink^ *' To, " or '' By Balance, ^ as the case may be, and transfer the amount in black ink to the opposite side of the Bal- ance account. 133 What, if the difference represent a gain or a loss.? Ana, — If so, enter on the smaller side,|in rod ink, " To, " or " By Loss and Gain, " and transfer y HHUMlMi MMBi iMiiiHiMiiiiMi M ORDER OF OLOBINQ. 59 it is It y '^^ the amount, in the same manner to the ^' Loss and Gain" account/ 134 What else is to be done to complete this step ? Ans, — Close all the accounts (except Slock or Partners') and transferred the balances as be- fore directed. 135 When the balances have been properly trans- ferred, what will the " Lo^ss and Gam'* ac- count show? Ans, — It will now show, on the debit tde, all the losses, and on the credit side, all the , gains, — the difference shall be the net gain or net loss. 138 What will the " Balance " account show ? Ans. — The Balance account will show on the debit side all resources, and on the credit side ail liabilities (except the result of Stock or Partners' accounts). 137 What will the difference be ? Ans. — The difference will be the real interest or present investment of the proprietor. 138 What is the Fourth Step ? Ans, — It is to take a " Second Trial Balance, *' or a Trial Balance of the Remaining open accounts : Stock or Partners', Loss and Gain, and Balance. • 139 Of what use is the " Second Trial Balance " ? Ans. — To show (the balances having been pro- perly transferred) that the debits and credits of tliese accounts, taken together, must be equal. 140 What is the Fifth Step ? /A mMUm m OHDER OF CLOSING. vliM. — It is to close " Loss and Gain " account into *• Slock, " or, if it be a parinorship business, into the pariner^' accounts, dividing the g;^in or loss acuordini' to aqiceiiient. 141 When the net gain or loss has been trans- ff'rrcd to the "■ Siock or Partners' accounts,'* what will these accounts show ? AnSp — Slock or Partners' accounts will nov/ show the original investment, increased by the gain, or decreased by the loss ; the difference being the present net investment. 142 Why must the difference oi these accounts (or Stock) agree with the difference of the Balance account ? i^, Ans. — Since the Balance accounts shows the same thing, they must, of course, agree. 143 What is the Sixth or last Step ? Ans, — Close Stock account (or Partners' accounts) into Balance account, which must equalize that account. 144 What must the Balance account show when complete ? Ans. — It must show on one side the total re- sources, and on the other the total liabililies- It presents, in the most condensed form, the exact present condition of the business. 000* mmtk .r a. o 1 IQ » I . ♦ « ■* r • > -n \ \' < l General Remarks. .; 145 Have we sufficient data in the Balance Ac- count to enable u« to open a new set of books ? Ans, — Yes, we have all the necessary information for that purpose, 146 Is there really any necessity for opening a Balance account ? Ans. — There is usually no actual necessity for opening a Balance account. 147 Why is it sometimes opened ? Ans, — To exhibit, undei one title^ the resources * ■' and liabilities. • " 148 In actual business is this account often ex- hibited on the Ledger? Arts.' — This account is seldom exhibited on the Ledger in actual business. 149 How are its contents otherwise shown ? Ans» — They are otherwise shown on a separate Balance Sheet. , , 150 Why does not the transferring of balances from one account to another destroy the Equilibrium of the Ledger ? Ans. — For the reason that, before closing any of the accounts in the Ledger, we ascertain by the Trial Balance that our debits and credits are f*qual, and we take care, in every step, lo keep them so, by debiting one account and crediting some other account with the same amount, and vice versa. EQUILIBRIUM OF THE LEDGER. 151 What is the transferring of balances equal to ? Ans. — In " closing up*' the Ledger, we call ihis process " transferring ; " but it is exactly equivalent to posting. 152 What is usually the first entry of this kind? Ans. — The first entry is to credit Merchandise and debit Balance with the properly unsold. 153 How does the above transferring affect the account on which it is made ? Ans, — So far as this affects our Merchandise ac- count, it is equivalent to selling ihe mer- chandise, and receiving therefore an absolute resource, which we call " Balance, " but which is Merchandise, reckoned at its true value. 154 How can we now treat our Merchandise ac- count ? i » . Ans.^We can treat it as if the property were all disposed of; this we do, in fact, by repre- senting the difference between the sides as a gain, 155 What is done wilh this gain ? Ans, — We now debit Merchandise account wilh this gain, and credit Loss and Gain, preserv- ing as before, our fundamental rule of " equal debits and credits. " Rem. — We persue this policy with all the accounts, trans- ferring always to the opposite side from that on which the closing entry is made and thus mentain a perpetual equi- librium. 166 Where might the Balances carried to the Loss and Gain account properly be transfer- red ? i [ ■MHiiiMiiiflMiiMik mmmm ■■ fiALANCES. 63 Ans. — They might wiih equal propriety be trans- ferred direcily to the Stock account. • 157 Why is it not done ? Ans, — B<*cau8(' we wish to exhibit, in one amount the net gain ot loss during the business. 158 Upon what principle are accounts balanced? An8,-'li should be remembered, that the balancing or closing of an account is simply upon tLc^ principle of cancellation. 159 How is an account made to " balance ? '' Ans, — An account is made to " balance '' by tak- ing away the excess. 160 Upon which side does this excess afterwards appear? Ans. — It appears elsewhere, and on the same side of the Ledger. . , , Rem. — These balances of gains, losses, resources and liabilities, are thu.s transferred to two accounts, '* Loss and Gain " and ♦* Balance " tkus exhibiting in the former, all the gains and losses, and, in the latter, all resources and lia- bilities. : , ' . 191 When all the balances except Stock are transferred to *' Loss and Gain " and •* Bal ance accounts, why must these with Stock Account, contain equal debiis and credits.^ Ans. — Since in the Trial Balance an equilibrium is shown, and in every subsequent entry the same is preserved, it naturally follows that these two accounts must be equal. 162 What is shown by the Stock account before the Loss and Gain account is closed into it 7 Ans. — It shows the capital at commencing. 64 BALANCES. 163 What is shown by ihe Balance account ? Ans.—li shows the capital at closing, 164 Willi what should ihe discrepancy in these two accounts agree? Ans. — The discrepancy between the two accounts, must exactly agree with the gain or loss in business. 165 Why must this discrepancy tally exactly with ihe diflerenee bt^tween the sides of the Loss and Gain account ? Ans, — Since the difference between the Loss and Gain account shows the ne* gain or tiie net ]os5! end the (ii^J'Trnce between the capital at commencing and the capital at closing shows the same, iiierefore the difference be- tween the sides of Loss and Gain account is equal to the difference between Stock and Balance account. 166 What will the Stock account show when this discrepancy is transferred from the Loss and Gain account? Afis. — The Stock account will show fir^i the. cap- ital at commencing, ami next the gain or loss during Kusiiiess, which together mu4t equal tlie capital at closing. . ^ ^ iC7 Why will the Stock account now agree with the Balance account? Ans. — For the reason that the Balance r^ccountj showing all the resources fiiui all the liabili- ties at closing, must represent the same differ- ence as Stock, and either being transferred lo the other account, must equalize the sides. Rem, — It will be apparent that throughout the discussion HilMyiiMiMa SSB GENERAL REMARKS. C5 this far, a marked distlction has been drawn between the proprietor and the business. It is necessary that this dis- tinction be clearly apprehended before proceeding farther. The f-^ct is strikin^^ly apparent in the first entiy on the books, which is to credit Sioek with the investment. Now if we inquire t^'Ao credits Stock, we shall be forced to the conclusion that there is a party represented here entirely distinct from Slock, or the pruprietoi ; as it would be non- sense to express the fact that a man owes himself, 168 What Particular Interest is always repre- sented by a set of bocks .? -4n«.— The books represent the concern and not the proprietor. 179 What relation does " Stock " account bear to the business? Ans. — The account opened with Stock is precise- ly the same as that opened with any other person, excepi that the final settlement with slock will not take place un^ill the business ceases, or he withdraws from it. 170 If the credit side of Stock account exceeds the debit, how does it affect the business ! Ans. — In as much as this difference, being a lia- bilily to the concern, must be paid over to the proprietor; hence the business is closed. ■000 >*»:■ 1 . . - » ■Mil 4, . ; ECONOMICAL METHOD J f' OF BOOK " KEEPINa* 1 What is the peculiar Feature of this method ? Ans, — It consists in the manner and form of original entries, which are made in separate books — elsewhere used as auxiliaries, — from which I hey are either journalized, or posted directly to the Ledger at stated periods. 2 Has this method any Advantages over that of consecutive entries in the Day-Book ? Ans, — Yes, it has many advantages over consec- utive entries in the Day-Book, and, in one form or other, is adopted generally in all large establishments. 3 In what do such advantage consist ? Ans, — In as much as the labors of the Book- keeper are thus divided up, and the separate departments of the business receive such special record as to present all the facts ia their clearest light. 4 Illustrate the above ? * The student should not undertake the study of this me« thod until he thoroughly possesses the usual method of Double entry ; otherwise he shall be much baffled in th9 nndeurstand of thisi ■ .'i/HlP.vn^qBP^WiW^ 68 ADVANTAOES. Ans. — Thus, if any particular information is de- sired respecting purchase?, all the facts can be shown at once from the Invoice-Book ; and, in the same manner the fact and condi- tion ol the sales can be shown from the Sales-Book, the receipts acd disbursements of tJash from the Cash-Book, &c. . 5 What Difficulty lies in the way of using the various books of original entries as principal books from which to post or journalize ? Ans.^The onlv difficultv is in the danger of making the entries in the different books conflict with each other upon the Ledger. 6 What should the Cash-Book show ? Ans. — The Cash-Book (if used) should be com- petent to show all receipts and disbursements of cash. 7 How is it made to show all receipts and dis- bursements of the cash ? Ans.^ By placing the receipts on one side, and disbursements on the other — the di'fference being, at any time, the amount on hand. 8 When cash is debited on the Cash- Book, what is credited ? Ans. —The object or cause for which it is receiv* ed may also be stated. 9 Is every entry, made on either side of the Cash- Book, really a double entiy ? Ans." Yes, a double entry i? effected, although but ofie amount is shown. ^^ Rem.-— The same principle will hold in entering the disbursements of cash ; as, when cas^h is paiii, (he object or cause for which it is paid is properly expressed. 10 CASH-BOOK. 69 10 What would be a proper caption for the debit side of Cash-Book ? Ans. — The appropriate caption would be " Cash Dr. To Sundries. " Rem.-^The debit of cash being the total amount re- ceived at any specified time, and tlie credit of sundries being the separate amounts produced by the difTerent causes represented. • ■ ; I 11 What, lor the credit side of the Cash-Book.^ Afis,—'' Sundries Dr. Tcr Cash. " . Rem. — Cash being credited for the total disbursements, and the sundry 'causes for which cash was paid debited for their separate amounts. 12 What credits are shown on the debit side of the C ash-Book ? Ans. — The debit Ade contains the credits o( all accounts producing cash 13 What debits are shown on the credit side ? Ans. — The credit side show the debits of all ac- counts costing cash. 14 Does the sam(^ principle hold with reference to the Sales-Book and Invoice-Book ? Ans. — It does, the Jnvoice-Book, will exhibit the separate credits producing merchandise ; and the Sales-Books exhibits also the separate debits produced by the sales. 15 What analogy exists between the Invoice- Book and Cash-Book ? Ana. — The Invoice-Book, which shows, in total, the entire cost of merchandise, sustains the same relation to merchandise that the debit •; r. "3^ 70 SALKS-BOOK, &0. side ot ihe Cash-Book does to cash. 16 What analogy, between the Sales-Book and Cash-Book? Ans. — The Sales-Book, which shows, in total, the proceeds of merchandise, sustains the same relation to merchandise that the credit side of the Cash-Book does to cash. 17 Will you now state the difficulty likely to oc- cur in transactions required to be entered in two of these books ? Ans. — In every case involving any two of these books, the tendency will be to debit and credit the same accounts ttvice — effecting thus a double entry not contemplated by the projectors of the science and of course not warranted by the facts in the case. Rem. — Thus, all cash receipts being entered, at spe- cified periods, in total, from the debit side of the Cash- Book, and all cai>h dit>bursenients from the credit side, it would be erroneous to enter cash from any other book ; and the same theory will apply with equal force to the Invoice and SaleS'Book. 18 What are the peculiar Rights of Each Book ? Ans, — Permitting all cash entries to be taken to the Ledger from the Cash-Book, and all pur- chases and sales of merchandise from the Invoice and Sales-Book respectively. 19 If the peculiar rights of each book are respect- ed what shall it prevent ? Ans, — It shall prevent the entering of cash in the Invoice or Sales-Book, and also of merchand-. ise in the Cash-Book. 20^ Give an illustration ? BiaHTS OF EAOH BOOK. 71 Ans. — Suppose an entry to be, " Cash Dr. To Merchandise. " All cash receipts must ap- pear on the debit side of the Cash-Book, and the entry on that book would be " To Mer- chandise, " extending the amount into the debit column. Rem, — When the Cash-Book is posted, this amount will be included in the total cash debit, and must comprise one of the opposite, or credit entries. So cash would be debited and merchandise credited both from the Cash- Book. * 21 Illustrate the corresponding part of the entry ? Ans, — Again, all sales of merchandise must bo entered in the Sales-Book, and when entered the corresponding debit — in this case, cash — must also be expressed. When the Sales- Book is posted, the total for which merchand- ise is credited will include this amount (al- " ready enlred and posted from the Cash- Book). to correspond with which, and to se- cure the necessary condition of equal debits and cjedits, cash must again be debited. Rem, — According to this standard, therefore, in every case where merchandise is either bought or sold for cash, and the fact expressed through these special books, this error of duplicating debits and credits would occur. 22 How many methods are there of avoiding this difficulty ? Ans,-~'T\vo methods have been successfully used in order to avoid this difficulty — the only dif- ficulty which stands in the way of classified original entries. 23 What is the first method I »<*" "W^^wwi^W^ 7Z BIGHTS OF EACH BOOK. Ans. — The first places the books upon an equali- ty, using " neutralizing" accounts for the con- flicting entries. V . 24 What is the second ? Ans» — The second acknowledores the supremacy of some one or more books, to which, in all matters of conflict, the others must yield. 25 Illustrate this by the case btfore instanced " Cash Dr. To Merchandise " ? Asn. — If the Cash-Book an J Sale.^-Book were upon an equality, the one claiming to fur- nish all cash enties for the Ledger and the other all merchandise sales, it would be im- proper to write Cash as a Ledger tiile in the Sales-Book or Merchandise in the Cash- Book, for the reasons adduced. i n 26 What then could be done ? ^ * * Ans. — A neutralizing account might be opened to take the place of cush in the Sales-Book and merchandise in the Cash-Book, thus re- ceiving a debit and credit of the same amount, which would of course cancel it. 27 Illustrate this? Ans. — Suppose the merchandise to be sold to A, for cash : in the Sales-Book the entry would be "A" Dr., and in the Ca^sh-Book, * A" Cr. The result would be the same as if A had purchased on account, and subsequently paid the amount in cash, thus^ closing his account* 28 What would the entry be supposing we ac- knowledge the supremacy of the Cash-Book in all cases where the two are concerned ? iln«.-— When Merchandise is sold for cash, the 2 2 EIGHTS OV EACH BOOK. n fquali- ie con- jemacy L in all lid. )tanced wore to fur- and the be im- e in the 3 Cash- opened les-Book thus re- le same 3el it. M to A, y would ►k, * A " if A had ntly paid account* y we ac- ish-Book itned ? ;ash, the entry in the Cash-Book would be " Cash Dr. To Merchandise," both of which — the debit of cash and the credit of merchandise — will go to the Ledger from the Cash-Book. The same entry can be made in the Sales-Book» but not posted. "* 29 How is the Inventory-Book used ? Ans, — This book is used to enumerate the differ- ent articles of unsold merchandise, at such times as may be deemed desirable. 30 Is this a special book ? Ans. — It is not, but purely an auxiliary, the amount of merchandise on hand being in- eluded in the opening journal entry. JRem, — Inventories are frequently copied into one of the luToice-Books ; but a separate book is preferable. 31 What does the Iloxn^stic Itivoice-Book con* tain ? Ans. — It contains copies of all invoices of mer- chandise purchased from importers, and others in this country, with the conditions of all such purchases. .■■*■' Rem, — Eaeh lot and package is distinguisbed by sditte peculiar mark, which is transferred to the invoice, tbus serving an important purpose in checking the articles, ad- justing disputes, &e. 32 What entries are passed to lh6 Ledger from this book ? Ans, — The purchases on titn^i for which notes are given, are passed to the Ledger from this book ; thbse for ba^h, from the Cash-Book. I 74 RIGHT or BAOH BOOK. 33 What does the Foreign Invoice-Book con- tain? Ans. — It contains copies of Foreign Invoices with Import Duties added. 34 What does the Sales-Book contain ? Arts. — This book contains all the regular sales, either for cash or on time ; the cash sales being extended in the inner column, are, of course, not included in the amount for which merchandis^e is credited from the Sales-Book. Rem. — These sales, together witli the petty sales not entered in the Sales-Book, are posted from the Cash-Book 35 With what will the total credit of Merchandise account for the month agree ? Arts. — It will agree in amount with the monthly recapitulation in the Sales-Book. 36 Are all the debits and credits appearing on the Cash-Book posted ? Ans. — Yes, all cash entries, debit and credit, are taken to the Ledger, eiiher ihrough the Jour- nal or directly, from the Ca^h-Book, together with all accounts producing or costing cash. 37 How are these amounts posted ? Arts. — In posting from the Cash-Book, the total of I he debit side is carried to the Cash ac- count in 'he Ledger, a.id the items compris- ing that amount to the credit side of the va- rious accounts mentioned. 38 What, do the Check-marks opposite the amounts denote ? Ans. — The check-marks in the column following dates, are made to indicate that the amounts CASH-BOOK. 75 opposite in the "Sundries*' column have been journalized. * . 39 What would be written instead of the Check- marks were the amounts posted directly to the Ledger? Ans.— Were those amounts posted directly to the Ledger, the Ledger-page would be written instead of the'Check-marks. 40 Can the Bill-Book be used to advantage as a principal book ? ^ns. — The BilUBcok can never, with advantage, be made a principal book, from which lo ' post. Rem. — For the Formulas of the different books used in this method let the teacher refer to ** Bryant & Strat- ton's Text-Book " whence the abo? e has been largeij dranrn. . -ooo- m^ / Changing Double Entry to Single Entry. 1 What does The Term Single Entry denote ? Ans. — The term " Single Entr^, " as distinct from **i>0M6/e Entry, '' ha? particular reference to the fact, that for every separate Day- Book entry, but one posting is made to the Ledger. 2 What is usually understood to |be the Differ- ence between Single and Double Entry ? Ans, — It consists mainly in the fact that while the Single Entry Ledger contains only ac- counts with persons, Double Eniry deals also, and in like manner, with property and causes. Rem. — Single Entry comprises arecord of the resour- ces and liabilities ; ivhereas Double Entry comprises a perfect and continual record of resources and liabilities. 3 What is the Rule for Changing Single to Double Eijiry ? Ans, — Open such additional accounts in the Ledg- er as are necessary to exhibit the entire resour- . ces of the concern, 4 If an account has been kept with Stock, what mnst be done with the gain or loss ? Ans, — It will be necessary first to carry the gain or loss of the business to this account, as a perfect record of resources and liabilities ronnot be otherwise had. CHANGING DOUBLB TO SINGLE ENTRY. 77 d a e r- e 9 a Is Double Entry more laborious than Single Kntry ? Ans. — It is not anything more intricate or labor- ious, and it will be seen that Double Entry is but a continuation of Single Enlry ; car- rying out its principles to their lull symmetry and perfection. 6 What are the Principal Advantages of Double Entry over Single Entry ? Ans. — The chief; advantages consist, first, in the security afForded by the Trial Balance test and next, in -designating the particular chan- nels through which gains and losses come. 7 In changing Single to Double Entry, is it nec- essary to disturb the accounts already shown on the Single Entry Ledger? iliw.— r-No, it is not, nor it is necessary to keep any such accounts differently afterwards. 8 What are the most essential books in Single Entry ? Ans.— 'They comprise a C ash-Book, Day Book, and Ledger. 9 For what purpose, and how is the Single En- try Cash-Book used ? Ans. — The Cash-Book is foi the same purpose as the Double Entry Cash-Book, and kept somewhat. upon the same principle. 10 What difference exists between the Single Entry and Double Entry Cash-Book ? Ans. — The only difference is in the ^brm of re- cording the entries. 11 Is it customary to journalize or post from the Single Entry Cash-Book ? I ^mm 1 IHVI W 0A8H-B00K. M' ilrw.— No, we neither journalized nor post from the Single Entry Cash-Book, hence it is not nercssary lo specify Ledger titles', as in Double Entry. 12 What is the object of the Single Entry Cash- Book f Ans, — The object is simply to complete the record of transactions omitted in the Day-Book, and to keep the necet^sary check upon receipts and di! tens, &c. Rem. — Let ihe student practice on two columns, until be becomes thorou£^l)ly famiiiur with the process, and then take three and fourf the necessity of keeping his mind constantly on the alert for fear of adding tens to units, and units to hundreds, will serve to quicken his powers of con- centration, and develope the practical resources of his mind. Example : Suppose the following numberi to be added 4.G 78 -• . 93 Process : 9;J X 8=101 ; 101 X 70=171 j 17; >i 6=177; 177X40=217. 14 What is the best method of avoiding the diffi- culties in getting a Trial Balance ? Ans. — Undoubtedly the best method is not to make difficulties. , 84 TRIAL BALANCB. Rem. — But as this advice is much more easily given than followed, and as, in despite of the best efforts, Trial Balances do frequently fail to equilibrate, a few hints as to the most approved methods of discovering the errors may be kindly received, 15 Is the Trial Balance a sure test of the correct ness of the Ledger? Ans, — In the first place lot it be remembered that while the Trial Balance is not a sure test of the correc'nrss of the Ledger, no Double En- try lifdger can be correct that does not bal- ance. 16 What is a Trial Balance ? -•Ins. — The Trial Balance is simply the summing up of the debit and credit sides of the Ledger to a!revenling all subsequent dis- pute as to the correctness of the claim. Rem. — A bill may be receipted by means of a due-bill, (See formulas.) • -000- Exchange. li Define Exchange I Ans. — It is a term lised to denote that commer- cial usage by which individuals are enabled to cancel debts at a distance without the transmission of money. 12 How is this effected ? Ans. — Through a species of commercial paper known as " Bills of Exchange. " 13 How many classes of Exchange are there ? Ans. — Two classes : domestic and foreign. 14 Define Domestic Exchange ? Ans, — It consists of drafts, notes, checks, certifi- DOMJISTIC XXOHANUl. 91 cales of deposits, etc., the parties to which reside in the same country. 15 What are Foreign Bills of Exchange ? Ans. — They are bills which are drawn in one country, but are payable in another. * Rem. — They are generally termed Drafts. 16 How are they drawn? • Ans. — They are usually drawn in sets of three or more, one of which being honored, the others become void. 17 What is the manner of sending ihem ? . ^/25. -The separale hills are sent by different rouifcs, or at different times, lo provide against miscarriage, and the first that comes to hand, if either, is honored. 18 How are Foreign Bills of Exchange made payable } Ans. — They are made payable in the currency of the country upon which they are drawn, instead of that wherein they originate. 19 What is a Bill of Exchange ? Ans. — It is an ordt-r or draft, nidJe by one pevson upon a second, to pay a certain sum of money lo a thirJ, or lo his order, or to llio bearer. (See foniiulas ) 20 How many parties are concerned in a Bill of Exchange } jjis. — There are always three parties to a trans- action and usually four ; Drawer, Drawee, * The United States being separate sovereignties, ara foreign to each other, and bills drawn in one payable ia another are foreign bilU, though apparently inland* IMAGE EVALUATION TEST TARGET (MT.3) 1.0 I.I 11.25 ■A£128 m Vi m lit 125 |: uo i2.0 HUU U 11.6 C Sdences Corporalion 33 WBT MAIN STREIT WiUTIR,N.Y. MSM (71«)t7a-4S03 4r n BILL OF EXCHANGE. • Payee, and Buyer or Remiller. 21 Who is ihe Drawer ? Am. — The person making the order is so called. 22 Who is the Drawee ? Ans. — The person to whom the order is address- ed. 23 Who is the Payee ? Ans. — The one to whom the amount is made payable. 24 Who is the Buyer or Remitter? Ans, — It is the person who purchases the bill. Rem. — He may be himself the payee, or the bill majr be drawn in favor of any other person. 25 When does a person become Acceptor? Ans. — Tf the drawee accepts, he then becomes ac- ceptor by writing his name across the face of the Bill, under the word " Accepted. *' 26 What is the instrument then called ? Ans. — It is called an Acceptance. r 27 If the Payee writes his name upon the back of the inslrnment, what does he become ? Ans. — He then becomes an Indorser. 28 How is the person called to whom it is after- wards transferred by indorsement ? Ans, — He is called an Indorsee. 29 What is the Face of a Bill of Exchange ? Ans. — It is the sum ordered to be priid ; it is usu- ally expressed in the currency of the place on which the draft is made. - ,. mm PAR OF EXCHANGB. ^ 30 What is the Par of Exchange ? Ans, — It is the eslimated valae of the coins of different countries as compared with ihose of another. Jlem. — It is divided into trinsic and commercial. 31 What is Intrinsic Par of Exchange ? Ans, — It is the comparative value of the coins of different countries as determined by their weight and purity. Rem. — Two sum sof different countries are intrim ; cally at par when they contain an equal quantity of the same kind of pure metal. 32 What is the Coinihercial Par of Exchange ? Am.^M is the comparative value of the coins of different countries as determined by their market value. Rem. — 'JVo sums of different countries are commer- dally at par, when tliey can purchase an equal quantity of the same kind of pure metal. 33 What is the Course of Exchange ? Ans. — It is the current price paid in one place for • bills of exchange on another place. Rem. — This price varies, according to the relative con- ditions of trade and commercial Credit at the two places between which exchange is made. Thus, if Boston is largely indebted to Paris, bills of excbangie on Paris will bear a high price in Boston. . ^ 84 What is Direct Exchange? Ans, — It is that exchange which is confined to two places between which the niohey is to be remitted. \ I . 04 DIRBOT IXCHANam. Rem. — One person is said to draw on another person, when he is die maker of a draft addressed to that person, 35 What is a Sight Draft ? Arts. — A Sight Drat or Bill is one requiring pay- ment to be made " at sight '' e. i., at the time of its presentation to the person ordered to pay. 36 What are Time Bills? Ann. — Those requiring payment at a certain spe- cified time alter sight or after date. 37 When are others payable ? Ans, — All other Bills are payable on demand. 38 When Time Bills are drawn " Acceptance received, " what shocid be done with them ? Ans. — They may be held till maturity before being presented to the Drawee ; otherwise they should be presented immediately for • acceptance. 1 tW» lU Promissory Notes. 1 39 What is a Promissory Note ? •^/- Ans, — It is a written agreement by one parly to pay to another a specified sum at a specified time. 40 Who is the Maker ? , . , Ans, — The one making the agreemer/ or signing the note, is called the Maker, 41 Who is the Payee f . patxb; U ilws.—The person to whom the amount is made payable. 42 Who is called the Holder ? Ans. — The ovvrif^r of the nole is so called. 43 Who is ihe Principal? Ans. — It is the one directly responsible for the payment of a Bill or Note at maturity. 44 What is a Joint and Several Note ? A7ts. — It is a note signed by two or more distinct parties, in which rase each one becomes liable as maker or principal, /> 45 Mention some of the Features of a Valid Promissory Note ? Ans. — A full conj^ideratian is implied from the nature of the instrument, but a want of consideration would be a valid defense on the part of the maker as against the payee. 46 Would a want of full consideration be a valid defense on the pari of the amaker as against any other holder into wn(isi possession it may have come without a knowledge yf such want of consideration ? Ans.— It would be no defense and this third par- ty would be called an innocent holder, 47 With what may a Promissory Note be written ? Ans. — It may be written with iok, or pencil, or it may all be printed except the signature, which must always be ii\,lne hand writing of the maker or his authorized agent. 48 Mention some of^er features of a valid Pro- missory Note ? Ans, — It should be an unqualified promise to pay ( 96 FEATURES OF A VALID FQOMISSORY NOT£. in mone)^ definite in amount, and indepen- dent of ail contingencies. 49 Where and how should the amount be ex- pressed ? Ans. — The amount should be expressed in the body of tne note, in words, and should be re- lied on for accuracy rather that the figures in the margin. 50 If the time is not definitely stated, when is it payable ? Ans. — It is payable on demand. 51 If the place of payment is not specified where is it payable ? Ans,-- It is payable at the place of business or the residence of the maker. '000- Negotiable Paper. 62 What are Negotiable Paper? Ans.— Bank potes, checks, certificates of deposit, bills of exchange, and promissory notes, when properly drawn are negotiable, except when made payable by the terms of contract to one person only. . - • 83 What if the amount i^ payable to " bearer *' or is subject to the " order ' df the payee ? . Ans. — They are negotiable. 64 When neither the word ** bearer '* tioi^ " order " appears in the instrument but simi^ly the name of the payee, is it hegoti(!iblb ? -i\ 'a 4i .mi.iii NXOOTIABLS PAPER. 97 Ans. — It is not negotiable, and the Payee cannot give ihe full title to a third party. 55 Why nan he no* give the full title to a third . parly ? Ans, — For the reason that the account, as be- tween the Maker and Payee, would still be subject to a garnishee process froin other creditors of the Payee. 56 In how many ways may the Transfer of Ne» gotiable Paper be made ? Name them ? Ans. — Two : viz., by delivery or by indorsement. 67 When is the transfer made by delivery 9 Ans,— When payable to " brarer, " or to the Payre ** or bearer, " as are Bank Notes and most Checks. , 58 Whon, by indorsement? -4w5.— When payable " to the order of " the Payee, or to the Payee *' or order. " 59 How many kinds of indorsements are there ? Ans. — There are two : blank and full or special indorsements. 60 What is an Indorsement in Blank ? Ansi — It cr.nsists in the Payee simply writing his name across the back of the paper ; this is afterward negotiable by delivery. 61 What is a Special or Full Indorsement ? Anst—Xi consists in making the bill payable to the order of another person, called an Indor- see, to which is added the indorsement in blank. . . ; ^ . .,,; -.: -; Rem. — This is now negotiable only by tlie indbrsement of the Indorsee. — Example : Thus an Indorsement in full {■ 98 SPECIAL OK FULL 1ND0RSE3IENT. hj A. B. is usually in this form : " Pai/ C. D. or OrdeVy ** and signpu " A. B. " Its effect is to make the bill pay- able to C. D., or his order only. 62 When the Iiulor-spment is in blank, can any legal Holdt^r make it an indorsf-n^fnt in tuil ? Am. — Yes, any Irixal Holder U allowed lo write '^'(hat above it, which will make it an indorse- meni in full. jfjewt. — He may also convert a special into a hla7ih indorsement by striking out the words that made it .ir an indorsement in full, 63 What is a Qualified Indorsement ? Arts, — Ii is one thai affects the liability of the indorser, but not the negotiability of the paper, hs when made " without recourse, " ^ 64 What kind ot Consideration is necessary to -^' support a Pro^nissory Note ? •• Ans. — A valuable consideration is necessary, not one founded on mere love or affection. ^ '. i . ; Rem. (1). — A note drawn as a gift to a relative or to a friend cannot be enforced as between the original parties : a consideration which thfi law esteems valuable must exist, in order to furnish a just foundation for an action. Rem. (2). — Illegal consideration also will render a note Toid ; as when given for the purpose of crime. v "*■ 65 Do any cases exists in which a note is void in the hanis of innocent indorser for a valu' able consideration ? .,.-...> ilns.— Yes, there are two cases ; and these are, when the consideration in the note is money won at a play, or where the money is given for a usurious debt. QUALIFIED INDORSEMENT. 99 f> 66 Mention the two forms of written obligation, known as '' Negotiable Paper ? *' Ans.-^A Note and a Draft or Acceptance. 67 What is the It^gal value of each and in what do they differ ? A?is. — They are precisely similar in their legal value, and differ only in form from the dif- '^ ferent circumstances of their origin. . ,^ 68 With whom does a Note originate ? Ans, — With the Payer and is a voluntary promise pay. 69 W^ith whom does a Draft originate ? ' - »^ Ans. — With the person on lohose account the pay^ ment is to be made, and is usually in the form of a request. 70 What is necessary to make the one equivalent to the other ? Ans. — It is necessary that the person of v/hom the request is made, should respond, which he does by writing across the face " Ac- cepted, '* and signing his name. f? Rem.-'Thi^ is now as virtually a " Promise to pay " as the ether, and there is no commercial difference between the two. './jh t^^i'Oj i."'-''"T :' " .' '/•;: "■. » no 'L 71 Does there exist any Bessemblande be- tween a Bill of Exchange and a Promis- sory Note in its original lorm ? -4ws.--No, a Promissory Note in its original form of a promise from one person to pay a sum of money to another, bears no particular resemblance to a Bill of Exchange!. 72 When does a resemblance exist ? 100 IND0B8£R. Ans. — When the note is indorsed there is a very great res«rnbl nice, for the.i it is an order by the |nd()r>er to iht* Makrr of the noie to pay the money to ihe Indorsee. 73 To what party in a Bill does the Indorser of a Note corif j'pond ? Ans.— To the Drawer of the Bill. 74 To what party in a Bill does the Maker in >ioi<* correspond ? j[ns. — To the Drawee or Acceptor, 75 To what party in a Bill does the Indorsee in a Note coneppond ? Ans." To the Payee. 76 Are the rights and obligations of these corres- ponding parlies the same ? An8. — Tht'y are nearly or quite the same. 77 In what do Checks differ from Bills of Ex- change ? Ans.- In the following respects : — Isl. They are alwavs drawn on a bank, or on bankers, and are payable immediately on presentment, without any days of grace. 2d. They require no acceptance as c^stinct f.om payment. 3d. They are always supposed to be drawn upon a previous deposit oi* funds. BfM. — Til order to inaV»* tb*" drawer liable, in rase the chei k i^ <)i>bonourerl, tht; holder must present it for pay- Uipni within a reasonable tiin*>, andif dishonored, must ^ive the drawer notici thereof within a reasonable time also* 78 ^Vhat is a Check on a Bank ? An$, — It is a wriiten order addressed to a bank, or to persons carrying on businessrof bankers, '^- LIABILITT CONNBCTID WITH NXOOTIABLI PAPXB. 101 by a person having money in their hand?, re- ^' quisling them to pay lo another perscn, or to bis order, a certain sum of money mentioned in ths check. 000 Liability connected with Nego- tiable Paper. 78 What do you understand by an Innocent Holder ? Ans. — It i.«« a person who, in good faiih, for a valuable consideration, receives Bank Notes, Checks, and oiher paper negotiable by de- livery 9 ^wt.— Should the party from whom they were received have outaiiieil them frauilulentlj, be (ihe innocenl holder) may legally retain them. 79 Are Bank Notes a good tender ? Ans.— -'They are, if not objected lo at the time of payment, uniess it should appear afterwards that they wert», at the ii»ne of payment, worth- less, or of less value than represented, as when counierleit, altered, spurious, broken or uncurrent. 80 What should be done when these Notes are iound to be counterfeit or altered, &c. ? An$. — They should be returned immediately^ as any unreasonable delay to return them, after the discovery is made, whereby the Payer loses the opportunity or iiieans of indemnity would throw the loss upon the Payee or Holder on account of the neglect. 102 DUTY OP A PERSON RECEIVING A CHKOK. T^ ^ 81 What is the Duty of a Person receiving a Check on the Bank ? Ans. — It is his duty to present it for payment at the Bank, during the same or the next day^ at furthest; otherwise he holds it at his own risk, the loss being his if the Bank fails in the meantime, provided that the funds were there to meet the Check before the failure. 82 If he lives at a distance from the Bank what must he do? •„ . Ans. — He must send it for collection by mail, dur- ing the same or next day. 83 What, if the Cheek passes through the hands of several persons ? I Ans. — If so, each one is allowed one day, and his liability, so far as above described, ceases V with the succeeding day. 84 How may this mission be fulfilled ? Ans. — Bank Drafts or ^' Bankers' Exchange, " from their services in making remittance to distant points, may be used to fulfil this mission, but should not be allowed to lie still or circulate as money beyond ihe reasonable expeciation of tUe Drawer. 85 What follows when the Holder of a Check gets it certified as good by a Bank on which it is drawn ? , ,. : < ' ' .V. Ans. — The Drawer is released though the Bank fail to pay. ;/ .-w,; : vi .. ; i , -lir Rem. — As between the maker and payee of a note the maker is allowed any defense that would be allowed in any other debt between the two. But as between the maker PRINCIPAL ON A PROMISSORY NOTE. 103 a A' { and indorsee, or other holder no defense can he set up, ex- cept it be shown that the holder had knowledge, at the time of the note's coming into his possession, of a just ground of defense between the maker and payee. If how- ever the note came into the possession of the holder, after it become due, the claim of the holder would be subject to all the equities in favor of the maker that existed at matu- rity, or that had arisen after maturity. 86 Who is Principal on a Promissory Note? Ans. — The Maker U Principal and is directly res- ponsible lo any bona fide Holder. ' * 87 When and how are Indorsers Responsible? Ans, — When the Drawee fails to make paynnent, and in the order of their indorsements are se- parately responsible for the payment of the Bill. Mem. — The liability of those who indorse as guarantors is not so easily discharged by a failure to gi,*^ prompt no- tice of non-payment. 88 When does a Bill of Exchange involved a di- rect liability ? Ans. — Only when presented for acceptance. 89 If acceptance be refused by the Drawee, what follows? Ans. — The Drawer immediately becomes Princi- pal, and is bound to redeem the Draft from the Holder without delay, though it be a Time Draft, and the lime not yet expired. 90 What follows if the Bill be accepted ? Ans. — The Acceptor becomes Principal, the same as the Maker of a Promissory Note, in which case the Drawer sustains practically the posi- tion of first Indorser, in case of non-payment on the part of the Acceptor. 104 LIABILITY AVOIDED. gi To what is the liabllily of Indorsers on Bills equal ? Ans. — The liability of inciorsers on Bills is the hatiie as of those on Promi>S'ory Notes. 92 How IP th*^' Liab'lity Avoided in both rases } Ans. — By the Inciorser!^ wriiing ovt r their Indorse- ments ** without recourse, " or oiher words ot equivalent signification, except so far as to warrant thai the Bill or Note is genuine. 93 When again are indorsers released from liabil- ity? il««.— If not duly notified of non-acceptance or non-;>aynient, the paper having been duly presented. 94 How does a discharge to the acceptor aflec^ {he other parlies concerned in a Bill ? Ans. — It IS also a discharge to all other parlies concerned therein 95 Ho'vV does a discharge to an Indorser affect other parlies C'>ncerned ? Ans.— h is no disclmrge to prior Indorsers, but .,. it is to all subsequent Indorsers. 96 vvhai is an Accommodation Paper ? Ans. — It is a N.;te made or a Bill ol F^xchange ac- cepted by a man who lends his name and cred- it for the aocotnrnodation of another j)arly. 97 To what extent does he become liable. Ans. — He thereby becomes liable to any bona fide Hokur, lo ilie same extent as if he had received a full con>ider»tir^n, except to the person for whose accommodation the credit was given. 98 Has be any claim for his indemQity 7 PBESENTMEMT. 10& 8 e Ans. — Yes, he hns a valid claim on the party ac- comn^iodaled. 9 IS ■000- Presentment. * 99 What havpyoo to remark on fleiay in present- ing paper lor payment or aceepianee 9 Ans — There :»houl )> POWER OF ATTORNEY. A letter or Power of Attorney, is a written delegation of authority, by which one person enables another to do an net for him. „, ^. , , , ,,, ••t- •s; -fi, ,. »it'.» POWER OF ATTORNEY. Ill ve ill ep n(i > When a power is special, and the authority linoited, the attorney cnnnot bind \\U principal by any act in which he excf-eds »hat aulliority ; bnt the authorily of the attorney will be so construed as to include all necessary means of exernling it with effect. When the power is in writing, and subject to the in- spection of the parly, no good reason exist for binding the principal beyond the scope of it ; though in general he who employs an agent or attornt^y shall lose by his fraudulent or illegal acts, in preference to an innocent third person. in -000- Testimony of Account Books. i ' 126 What is the most established law of testimo- ny .? Ans. — That a person shall not be permitted to tes- tify for himself, or, in other words, manufact- ure his own testimony. 127 Is there an exception to this salutary law ? Ans, — Yes, from the necessity of some cases an exception does exist 128 What is this exception? Ans. — The law allows a person to furnish testi- mony for himself by admitting his Account Books, under certain restrictions, as evi- dence in his favour. . 129 To what is this testimony liable ^ Ans, — It is liable to the strictest scrutiny, and is' 112 TESTIMONY OF ACOOUMT BOOKS. ronsiidered by courts as the moi^t suspicious hind. 130 What fucts would a person be obliged to prove in ordrr to intitle his book&> to be received iu evidence for himself? Ans. — He must prove the following facts : — lst« That he had no clf»rk, 2nd. Thai the books produced are his Account Books. 3rd. That some of the articles charged have been deliv- ered. 4 h. That he keeps fair and honest ac- connt5», and this he must show by those who have dealt and setlUd with him. 131 Are Account Books received as evidence of mon; y lent, or money received or expended for the use of anotiier? Ans. — No, ihey are never received as evidence in the above cases ; nor are ihcy evidence of a single charge. 10U9 t % irove d iu -1st. ooks riiat tliv- l ac- who le of ided ;e m of a Forms of Bills, N"otes, Drafts, Checks, &c., &c. 9 t ■ :>f ^ .,-.1 i.^ ff' l' r fi nlf l W II II I i m ill l hl l t m i r ii nl MIl n n I .'..UL'^ .jr>:{ f < .% . Bills. 1 :i .1 Monlrealf Juli/ Itt.f 1B70 Mr. THOMAS HANRATTY, "" * Bought op William Johnson. 10 lbs. Butter @ 15c. $1.50 50 lbs. Sugar 10c. 5.00 . 24 lbs. Pearl Starch ©12^0. 3.00 20 lbs. Dried Apples @ lie. 2.20 15 lbs. Rice @ 5c. 0.75 12 lbs. Tea @ 60c. 7.20 4i JV ' ■/. Received Payment, $19.65 WILLIAM JOHNSON, .r! 1 J» r Montreal, July 2nd., 1870. Mr. FRANCIS HART, 1869. Bought of James Smith. June ■'5. 9 yds. Silk @ IJl.OO $ 9.00 " " 12 yds. Muslin ....@ 20 2.40 Sept. 12. 5 yds. Broadcloth.® 5.00 25.00 « '•' 2 Cravats @ 1.25 2.50 Nov. 5. 5prs. Boots @ 5.00 25.00 ,. % '^ ««*•*•• Received Payment, $63.90 JAMES SMITH, ;per Dawson. 116 BILLS. % ' Toronto, Jan. 2Ut., 1870. Mr. H. J. GIBNEY, 1869. To Rice Lewis, Dr. Feb. 3. To 5 doz. Rakes @ $ 1.50 3 4.50 " 7. ** 2 doz. Hoe? @ 6.00 12.00 Apr. 10. *' 4 doz. Scythes.... @ 10.00 40.00 . ir 5. " 1 Mill @ 25.00 $81.50 Recmed Payment by due-bill) Jan. 10, 1870. RICE LEWIS. NeW'TorJc, Feb. 4/^., 1870. FITZGERALD & Co., To A. T. Stewart, Dr. 1869. Sept. 12. To 10 yds. Cambric @ 10c $ 1.00 « " " 50 yds. Sheeting @ 12^0.... 6.25 Oct. 18. " 12 yds. Cas8imere....@ $1.50 18.00 « 20. " 30 yds. Print @ He 3.80 Deo. 15. " 20 yds. Velvet @ 3.00 60.00 Cr. $88.55 Sept. 1. By40bu. Coal ....@ 12Jc $ 5.00 Nov. 20. '' Caj^h @ 40.00 «< 22. " 5 Cords of Wood @ 4.00 20.00 $65.00 BalsDce due $23.55 Received Payment, A. T. STEWART, . per DoTLB. 0. R. Form of a Set of Exchange. EXCHANGE for £1,000. New-York^ June 1, 1870. Ten days after sight of ihis my first Bill of Ex- change, (second and third of thv same date and tenor unpaid) pay to Mr. T. THOMPSON or order, One Thousand Pounds Sterling, value received, with or without farther advice. A. T. STEWART. To RICHARD EVANS & SOxV Liverpool^ England, •1 EXCHANGE for £1,000. NeiO'Yorky June 1, 1870. Ten days after sight of this my second Bill of Exchange, (first and third of the same dale and tenor unpaid) pay to Mr. T. THOMPSON or order, One Thousand Pounds Sterling, value received, with or withqut farther advice. i, • A. T. STE\VART. To RICHARD EVANS & SON ' Liverpool^ England, ■I 118 FORM OF A SET OV EXCHANaB. i.' ».J .. '^:../ EXCHANGE for £1,000. NeW'Y,rk,June,l\S10. Ten days after sight of this my third Bill of Ex- change, (tirsi and second of th^ same date and tenor unpaid) pay to Mr. T. THOMPSON or order, One Thoaj^atid Pounds Sterling, value received, Willi or without further advice. ^ ^ A. T. STEWART. To RICHARD EVANS & Liverpool^ England .jv : wSON,) h * i^l i ;" -000- Notes. ''K ^ MOXS ki i■i^^\)^•*i'>^>. V'r:; -^^1; *i ^-k^" •> y^^H' i Individual Note, $500. ^^'^ Montreal, June 10, 1810^ Ten days after date, I promise to pay W. B. Forbs or order, Five Hundred Dollars, value re- ceived, .4 f CHARLES FITZPATRICK. NOTES. 119 ■"2 • Joint Note. $2,000 Quebec, March 16, 1870. Fifiy days after date, we promise to pay James Smith or order, at Union Bank of Lower-Canada, Tv70 Thousand Dollars, value received. WILLIAM MOORE. • ' THOMAS CLARK. Joint and Several Note, (with interest). $10,000 Toronto, Feb. 5, 1870. , Three months after date, we or either of us pro- mise to pay William Ford or order, Ten Thou- sand Dollars, value received, with interest from date. JOSEPH HINDS. ARTHUR SPENCER. ij>- > ■' • « . ,1>' Vi 'M.v -I J '. . . - Principal and Surety Note. $900. ' ' ■ ' Kingston, March 3, 1870. Ten days after date, I promise to pay James Richards or order, Nine Hundred Dollars, value received. JAMES O'CONNOR, Principal WILLIAM I>UNN« Surety. 120 MOTKS. I 6. Chattel Note. $200 Hamilton, July 2, 1870. Six months after date, for value received, I promise to pay to William Power or Onier, Two Hundred Dollars, in Wheat, at the then market rate, the same to be delivered as per his order, within the limits of the city of Hamilton. JOSEPH FULTON« 6. Non-Negotiiible Note. 6800. 0/toti?a, Jwnc 14, 1870. Three months after date, I promise ♦o pay James Annelt, Eight Hundred Dollars at his of- fice. "■ ^ DAVID MOORE, '■■• 000 ;--• -.''-'v. Drafts. Time reckoned from sight. $725. Toronto, May 10, 1870. At twenty day's sight, pay lo t' e order of Wil- liam Clarke, Seven Hundred and Twenty Five Dollars, value received and charge it to the ac- count of MICHAEL HARRINGTON. To DAWSON BROTHERS Montreal. SRS, I Mikm. m ^ 1S70. ved, I , Two market order, LTON„ Reckoned from Date, $300. London, Ont, July 2, 1870. Ten dj^ys afier sighi, pay to ihe order of Ber- nard Wallaco, Three Hnndred Dollars, value re- ceived, and charge to my afcount. EDWARD McCarthy. To PETER IIANRATTY, I Ottawa, i , 1870. ♦o pay his of- OORE, . 1870. »fWil- r Five he ac- TON. Due Bills. • 155. JFVir Cashj Drawing, Interest. Kingston, Ff!b. 12, 1870. Due John R. Spencer One Hundred and Fifty Five Dollars wiih iMt«*r^^t from date. WILLIAM T. ROBERTSON. ^■'tf 3 For Merchandise without Interest. 1^237 50 New Fork, Mar. 5, 1870. Due John R. McDonald Two Hundred and Thirty Seven Dollars Fifty Cents, payable in Rye, at market price on ihe first day of October next. HENRY McKERNAN. nt^kfin Orders. To apply on Account, Montreal, April 10, 1870. Mr James Williamson will please pay to the bearer, Seventy Five Dollar:}, in Merchandise on xny account. : ; ROBERT FAIRBANKS. 2 In full of account, Oltaioay Nov, 12, 1869. John J. Donoghue Esq. Please pay to Michael O'Donnell or bearer, Three Hundred Dollars, from your store, and this fihall be your receipt in full of my account. JOSEPH B. MOORE. ■000' Beceipts. On Account, WOO. — Received, January, 14, 1870. Two Hun- dred Dollars, on account of Peter Cooper. THOMAS HANRATTY. k RECEIPTS. 123 -^ a *-*) ■« » •»* .•«.#i- In full of all demands, $630. Kingston, Mar, M , ISIO. Received of George B. McArdie, Six Hundred and Tiiirty Dollars, in full of all deuiand:*. THOMAS BAKKR. 3 To apply on Contract. $4,000. Hamilton, Mar. 2, 1870. Received of William R. Doyle, Four Thousand Dollars, the same lo apply on contract for buid- ing house, dated Febuary i4, Ib70. " JAMES McDonald. * to apply as an Endorsement. «100. Ma3/2I, 1870. Received on the within note, One Hundred Dollars. GEORGE BROWN. Receipt for Properly. Montreal^ May 1, 1870* Received of Peter Jones, the following enumer- ated articles to be held in trcst for him, and re- turned on his demand : one Gold Watch (Hunting 124 HSCXXtf04 . c?i!»p>, tWA promi!»!»ory notp^, each dal*»d Marcli 10, 1870, and signed by J«)^«pp!l ('umiiiings* — one for Fivt* Hundred DoilaKS dne in tJirrt* rnonihs from dnti*, and one for Eight Hundred Dollars, due in four monlhs from date. JAMES HOPE. Checks. 1. Payable bearer, $700. Montreal Bank. HomiUon^ Mar 10, 1870. Pay to Thonnas McNamara or Bearer, Seven Hniulred Dollars (No. 1527.) W. J. ROSS. Payable to Order, $1,000. Merchant's Bank. Toronto^ July ^ ^ ^ 1870 ^ Pay to Charles R. Stewart or Order, One Thou- sand Dollars. FRANCIS HANNAN. Certifllcate of Beposite. Bank of Upper-Canada. $900* Loadon, Ont May 9, 1870. W. M. Robinson ha." deposited in this Bank, Nine Hundred Dollars, payable to Henry T. Ken- nady t>r Order, on return of this certificate. (Na ttdS.) JAMES THOMPSON. L^ • ♦ IN JOURNALIZING. 'r l! • I i '^ ' ' f A ^ 2 '*■ CntT"! Exercises in Journalizing. IVIiai will be your Journal Entry 9 1. Sold D. W. Clark, on account Merchandise* $200. Ans—D. W, Clark, Dr., To Mclse., $200. 2. Bot. of D. W. Clark, on account MiUp $200. Ans.-^MiUe., Dr , To W. D. c:lark, $200. 3. D. W. Clark, Paid cash, on accoun , $200. -4ns.— Cash, Dr., To D. W. Clark, $200. 4. Paid D. W. Clark, ca>h on aocoiini, i$200. Ans.—D. W. Clark, Dr , To ca>h, $200. 5. SoM W. VV. Han, on his noU', 30 day-*, Mdse, $175. " ""• = '■■ ilns.— Bills Rt«ceivMblp, Dr., To Mdse , $i75. 6. liot. of VV VV. Hart, on m >oio, 60 days. Md ;250 ^ns.— Mdsv-., Dr., Po Bills Payable, $250. 7. VV VV. Han Paid hi:" note, in cash, J 175. Ans —Cash, Dr., To Bills Rcfretvable, $175. 8. Paid my note 1o VV. VV Hart, in ca-h, 8250. ^,i5.__Bills Payable, Dr., To cash, $2^0. 9. Sold J. H. Holmes, Mdse., $450. Received in payirieni his note for $250, and cash for ihe balance, $200. Ans. — Sundries Ur. To M^lse. n • • . ...... Bills Receivable.. $250 $450 C»?h 9 ? % 2Q0 1^ BXE1tCI8T.S IN JOVR!fALIZnrO. I' r I VO. B'>t. of J. H Ffc>'m-t», V'U\. $500. Gave iir PMVmtMii my iinir for $250, i^nd c:a^*l^ lt)r ihe h .liiiiM-, $2.30. Ans. — Md>e., Dr , To Siindrio* - Hills P Cu>h . • • • • • $500 t>i4 C( iiyahie . $250 .•a>n 250 ri Exchanged the above iioies with Holmes, $250. Afis.—\h\\s Payable, Dr., To Bills Receivable,. $^50. -. 12. Bot. of J. Dnnnins his» hou<»e and lot on Sprinij Slreel,^2000 (iave in pay»nent,CH^h,$1000i Mdso., ^500, and my note for tho balance,. $600. Ans.--LicVL[ Estate, Dr., To Sundries $2000 ^ *^ r«5»h $1000 « Bills Payable. 600 »' Mdse 600 13. Sold my honse and lot on Spring Si reel lor $2600. Received in paym»'ni S S. Clark's Boif, 3 monihs, $1000, Cash $1000 and Mdse. fi»r ih»* balance, $500. ■ itn5.-Smidri»'s Dr., To Real Kstare $2500 Bdls Receivable $1000 • . Cash 1000 Md>e 600 14. The Commercial Bank has discounted S. S. Clark's* nt>iH lor $l()00. Di^counl, $17.60; Ca^h received, $982.50. ^ns.— Sundries' D ., To Bills Receivable.. $1000 Ca>h $9!iJ2.50 Interest 17.60 16. Holmes & Co., New- York, consigned an in* in- lihe >0 BXIR0I8K8 IN JOUBNALIZXNQ. 120 voice <»f sfood.'* to me, to be «)id on their ac- coiiiil, $575. Paid freight and charge.<«, in cash, 934 Ans. — Holmes & Co.'s consignment, Dr., To Cash, $34. 16. Consifirned goods to Hdmes & Co., Ni'w' York, lo he sold on my account, invoiced $645. Paid freight and cartage on same, in cash, 930.50, and gave my note for in^tur- ance on do., $!9.35 ilfW.—Cons. to N.y, Dr., To Sund .$700 85 Mdse $645 00 Ca-h 3(v50 ./ '•• ' B.IU Vny■^^ !.« .. ;9..>o 17. Sold Hohiirs & Co N goo is for ^G.'iO. lit cciv-- ed in pHVMirrii P Alniy'? nolf ior $30l>, and .. , C;is|i ("or balaiic , ^ j5'). -4n«.— Sund. I)r , To Holinos Cotisig't $650. Cash $350. -' ^ Bills Receivable 300. 18. Received an acfoimt sales of «a[ood< consigned to Molmes & Co., New- York. Met proceeds amount to $716. Ans, — Mol lies & Co , Dr., To Consignment lo New-York, $716. 19. P. A I my paid his Note, with inl<^rest. Note, $300; interest, $5.25=:$305. 25. ilns.— Cash, Dr., To Sundries.... 305.25 " B li< Rfcrivable $300 00 " liitfri'st , .3 25 20. Holmes ;* "■ ^■ 700 500' 800 EXAMPLES FOR PRACTICE IN SINGLE ENTRY. • ?, t t K' « 1 \ ^^r iVSU Examples for Practice h'/ In Single Entry. ( )..t • To enforco the theory of the above rules the fol- lowing exercises will be iouiid of great advan- tage. The student should be required not only to pro- duce correct results but also in each case to fill up a statement the outlines of which are given on Page 21. , ., ,^,^ Commenced business with a capital of $10,000. At the end of six months the following facts are gathered from the Account Booki, : Amount of Cash re(eived, $19000; Amount paid out, $13000. A -B's account stands, Dr. $780; Cr 6S0; C- D's, Dr. $*!55 ; Cr. $60; E F.'s Dr, $530 ; Merchandise on hand, as per inveniory, $6800 5 amount owing to G-H., $200. — Required, the net capital at closing^ and the ntt gain during bust- n€ss» I } jt Commenced business with a capital of $9000. At the end of one yar the following facts are gathered from the Account Books : — Resources : Amount of Cash received $15625 ; amount paid out $9 875 ; A-B's account ^Jtanfi9 Dr. $900; Cr. $550 ; C-D's, Dr. $1000; Cr. $200 ; E-FV, Dr. $975 ; Cr. $424.50 ; G-H's, 136 EXAMPLES FOR ySACTIClt. Dr. $175 ; Merjhandi:*^ on hanrl per inventory $6350; amount from Bili-Book Receivable $500. Liabilities : J-K*a aoconnt Dr. $600 ; Cr. ${500; L-M\s, l)r $500; Cr. $1200; N-O's, $251. 50; Cr. $051.50 From Bill-Book $100.— Required the net capital at closing, and the net gain during the business. M A. and B. commence business wiih the follow- ing Resources : Cash $80 ) ; Notes, $5000; Mer- cliandise, $50i)0 ; Rval Estate $4650; Balance due on p*TS4»nal acctmnis $3764. W ih«' «nd of 12 months th^»i^ Bosources anh lect- ivfd $^^5000 ; Amotint paid out, $21500; Nott's in our lav»>r, $20D0; Merchandise per inventory $15000 ; Real Estate, $20000; A-B*s, account siands. Dr. $2000; Or. $800; C-D's, Dr. $1500: Cr. $201)0; E F's, Dr. $1630; G-H's, Dr. $4300; Cr. $5600 ; I J's, Dr. $1200 ; Cr. $750 ; K-L's. Dr $800 ; Cr. $2500 ; MN's, Dr. $2000 ; Cr. $1500 : O Ks Dr. $100 ; Cr. $700 ; Q-R's, Cr. $900. Required the capital at commencing ; at closing ; and the net gain. James- and Francis -, entered into copartnership on equal terms, the former investing $20000 and the latter $15000; but Jam»*s , wilbdrew during the business $5000. At the end SXAMPI18 FOK PRAOTIOl. 137 of six month*, thp f<>]Irwing is the condition of lliH hiir>iii»*s!» : C'ish on \mm\ $10500 Due liiem on Pirj»<»n»l iccouni $7970.25 ; Due ihem on Noit-s^SiaO; M«'ri.haiidi5o on hand $1600; Real E>tai<', $4000 ; Siock«», $7000 ; They owe to per- !i*oiis on ncoonnt $1800 ; NoIp:* onisiaiiding, $ 1 5000. Has the business been adverse or proy perofis9 How much? What is each pattnersnei Cupital at closing 9 il 5 Three persons, enter into copartnership and in- ve^l as f«»llo\vs : Thomas Hanralty pots into ihe concirn $70(.»0; W. B. And«»rson, $6000; and R. M. McCoriiia*', $4000. The following n*sulis are shown at the rnd of the v^'ar : Ca>h r<*c»'ivt»d $90500 ; Paili >« at $1 00 ; 30 Bii>h. Plums at 80 c; 40 Bush. ('herrit'M at lb c— P.iiil rail- ag*', &o. $->0.— .2 Recrivfd (:a>h for P. tt> Sair?, $12 — 3* Sold Wiihatri Harrison on account, 10 Bbls. Apples at $1.30; 10 Biisli. Plutris at $1 00. — Paid l\»r Set of books $3.00. — Kicivid Cash for Petty Sales $25.-4. Sold James MeD«)nne||. on accouni, M Bbls. Apples ai $1.25; 5 Bush. Ch^T- ries al 80 c. — Paid John K. Smith Cash on ar- couni $150. —Received Cash for Peny Snles, $31.. — 5. Bright of Pa!riek Hughes on aceonni 100 Bush. Green gages at 90 e. ; and 200 Baskets of Peaehesat 75 o. — Rrocived lor Petiy Sales $40. — 6. Sold Thomas J O^Sullivan on aco>unt 10 Bask- ets i.fPeaehes at 90«-. ; and 10 Bbls. Apples at $ I. - 20. — Ri'Cjrive.i of Will. Harrison Cash on account $20 8. Paid ('ash lor Stationery $8. — Rtciived Ca>h hirPetiy Sales this day $50 9. Sold Fran- cis Hanraiiy, on account, 50 Ba>keis of Prachcg at 85c ; 15 Bu>h. Greens>a.,esai $1 — Rec»'ived*h in fuji of account — Re- ceived fi.r Petty Saksihisday $rJO.— 10. St>ld C. J. Judd on account 30 Baskets P<*aches at. 87 Jc. — Reci'ived Cash on account of Francis Hanraity 57.50. — Received Cash on account of James McDonnell $19.-11. Paid J. R Smith Cash on account $104 — Sold Peter J. Murj hy on account 10 Baskets of Peaches at 87J c— Paid Patrick Hughes Cash on account $240 00 — ^12. Bought of James Patters* n tni account 30 Bbls. ( rab Apples at $I.-Sf»td J. R. Ford for Cash 15 Bbls. Crab Apples at $1 .50 ; and 20 Baskets Peaches at $i.OO. —-Paid Store expenses $5. — Received Cash for 142 BXAMPLX8 FOB PRACriCl. Petty Sales this day $26. ' * * * Merchandise unsold, amounts, per Invenlory, to $300. ... ♦ •*'? Balance Account Wm. Harrison C. J. Judd, JameR Patterson. P. J. Murphy. Stock (prese?tt worth). ReRourcR<$ Liahihtiefs $ 26 25 8 75 2681 00 30 2651 268100 1st. I have this day commenced business with the following resources and liabilities, — Resources : Cash, $8402..^8 ; Merchandise, $97o.54; Bills Receivable, $576.43; James M. Davis' account $32.64, Francis W. Campbell, do., $742.57; Bank «.f .Montreal do., $20v)0.00; B. L Hanlon do., $!95.25; William J. McGee do., $318 50: Consignment to Albany do. $60200. Liabilities : William R. Wilson's account, kJtA»lI>L£0 ro& l»RAdTlCK. 14a $287.50; Bills Payable, $1091.30; T. H. Har- ris* aocouiit, $576 14 ; M. R. Johnson do., $100. 25 ; William Fallon do., $733 63 ; Slock $1 1059. 29. 6th. Received per steamer Emerald^ an invoice of g(»ods shipped by Stewari & (o, pursuant lo my order, airiouniing per S. B. to $956. Paid freight and charges in cash, $46.75 - 6th. Sold B. L Hanlnn merc^handise, arnh, itierehand- ise, amount iiig per S. B. lo$97.63. — 9th. Bought of Daniel Jones, lor Cash irierchandise amounting per S. B. to $48.96. I2th. Sold James Davis, oti account, merchandise, as per S. B. $73.19 — Received from F. S. Bogue, Albany, an account sales of flour consigned him, June 25th; net proceeds, $698, for which he has remifled me a check on the Bank of Montreal. — 14th Sold Da- vid Coleman, for cash, merchandise, as per S. B. $139 64.— Sold William J. McGee, on account, merchandise, $158.50. — Deposited in the Bank of Montreal, $700.— 16th. Accepted Stewart & Co.'s drafi on me, at 30 days' sight, for $956. —19th. Received from B. L. Han Ion cash, f^ balance ac- count. — Bot ,of J. & H. Mirick, for cash, lOObbls. of flour, at $5 50, which I immediately sold for $6 per bbl. — 20tlL Received per steamer SwaUj from N. Y., an invoice of broadcloih, amounting, per invoice, to $316, consigned to me by Crom- well, Haight & Co, to be sold on their account and risk ; paid freight and charges in cash, $10. — 2lst. Sold Francis W. Campbell on account, raen-handise, as per S. B. $46.- D posited cash in the Montreal Bank, 1000.— 24th. Sold Thom- as Colliu::j on account 33 yds. Cromwell, Haight, 144 BXAMPLis FOR FftAOTtCl. k Co.'« broadcloth, at $4 50. Reoeivod, in pay- fn*»n», his not^ at 60 rlays for oiu*-half, and cash for thf* balani-e — ^28th. Bong it of J(»hn H. Ilol- mes his house an t l«»t on B » id Street, for $2000* Gave in payriiont Ca:*h $1,000, and n»y note f»if the Balanr*'. — Sold Lewis & Herriek f»r Ca-^h the remiinder of Cromwell, Hii<3;ht, & (>o.'s broadcloth, fi)r $300 — Fruncis W. ('anipbell has paid me cash to b dance his acconnt'. — 30th. Made up an acconni sales of Cromwell, Haiij;ht, & Co/tfconsi*h to bal- ance his account — St)ld VVdIiam W. Hart, on his note at 90 days, merchandise, amounting to $216. — Paid Isaac C. Dixon his salary for one month, $50 — Store expenses, per Expense-book, amount to $47 — Cash sales of merchandise this luonth, $163. Merchandise nnsoM, per inventory taken this day, amounts tu $393.20. . v '.-f ■ ', Ih I* EXAMPLES FOR PRACTfCr. Balance Account * 145 Roaourceii Liabilities 1 • Merchai^dise per Inr.. .;...$ Real Estate « " Cash ; i» 893 2000 7778 864 3700 477 20 43! 42 3047 287 576 100 733 10968 15703 Bills UPrPlVAblfi.. ^A^M^MMMdM Bills Payable. 4 • *. , * 4. W. R. Wilson 30 50 - T. H. Harris. ; 14 Bank of Montreal . 1 . . . < • . < . "W. R. Johnson. ........... 25 W. R. McGee . » W.Fulton. i.. ;.. Stock (present worth) •• • • • . * 63 60 ■ ' 15703 42 * See ertata pages 143, 141, double entry. Second \ •Tan. let* Commenced business with a Cash Capital of $10,000—2. Bought of William Dunn for Cash 150 Bbls. Flour at $8.00.— Sold R. B, Spencer for Cash 10 Bbls. Flour at 9.50. — 4 Bought of Francis Coleman on our note at 30 days, 50 bu. wheat at 50c.— Sold William King on ac- count 5 Bbls. Flour at $9.50.— 6. I^ough^ of James Scott for Cash 10 pieces Calico at $5 ; 2 peices Casimere at $8. — 8- Paid Cash for Set of Books for use of Store, $20. — ^9- Sold Samuel Jones on his note at 30 days. 14 Bbls. Flour at $9.35.-10 Sold William Casey on account 30 Bu. Wheat at 60 c. ; 30 Bbls* Flour at $9.30.-11. Sold F, J. i .^^ 140 EXAMPLES FOR PRACTICE. McKeenan lor Cash 21 Bbls. Flour al $9.25 ; 5 pieces Calico at $6. — 13- Bought of Andrew Gor- man 16 Cases Shoes, 200 Pairs at $2.00. Paid him Cash $200, and balance on account. — ^17. Sold Thomas Jemison on account, 20 pairs shoes at $2.50. — ^19. Sold James Swift onaccount 40BbIs. of Flour at $9.50--— .27. Bought of John Gary on account 50 Piec^a Merrimac Prints at $5. — 30 Sold Michael Sullivan for Cash, 30 Pairs Shoes at $2.50.— Received -Gash on account of William Casey $100.-31. Paid Store rent in Cash $80. j^ Merchandise on hand, $921.00. jojifi .7/ viib Oi; ^» ^lon >tiii Jol) 1' Commenced business with the Re- ^ - 25 1 200 1 1 M.^J- -ti- ] , f t * J t Set. — Sold John Brown on account 20 Bn. Wheat at 60 c. — 2- Bought of Michael Harrington for Cash 200 Bbls. Flour at $8.50.-3. Received of William King Cash on account $47.50. — 4- Sold Thomas O'Donohue for Cash 5 Pieces Cali- co at $5 ; 2 Pieces Cassimere at $8. — 6- Paid our note in favor of F. Coleman (given him Jan. 4th.) in Cash $25. — 6. Sold Frank Harper on his note at 30 days 20 Bbis. Flour at $9.50.- Sold M<^)re & Fitzpairick on account 100 Pairs Shoes at $2.50 ; 9 Bbls. Flour at $9.50.- 9. Accepted John Carey's draft on us at 10 days sight favor of James Rooney, $250. ^-Received of James Swift Ca»hon account $380.^ — 11. Paid Cash lor s-undry expenses $10. — 14. Paid Andrew Goiman Cash on account $200. — 16* Sold Bernard Buchanan, on his note at 30 days, 30 Bbls. Flour at $9.50. — 18. Received from the executors of my deceased father's estate CasTi $3000.--20. Paid our ac- ceptance in Cash, favor of John Cany $250. 22. Sold Henry Johnson 20 Bbls. Flour at $9.50 ; 25 Pairs shoes at $2.50. Received in Payment bis note at 30 days. — 25. Sold our sight draft on John Brown to balance his account, for which we received Cash— 27- Paid Store rent in Cash $100. —28 Paid. Store rent in cash $100.-29. Sold our sight draft on Jemison to balance his account, for which received Cash. — Sold Francis McGuire for Cash 100 Bbls. Flour at $9.50. ~i Merchandise per inventory $818.50.a^_l!i '«•- \ '' » •« I ' /T iT'i « f j^rv^ /t '^ • ! » » ; s •k ^ o » m, w e .«• •« •» & CO i .' •% 9% •« M H •« ^ •» •» o S ^ Cash Bilb S s B ? -»/ .^ fr •^ f 1 1 »M* SI 0U t;» M • D 4» •? ! • • ^^ H^ ^^ CO •-* to CO ti 00 »^ 00 cc CO O c;i to h-* 00 o« »^ •4 CO 00 1 •* o< o O -^ o« 1 o« e IP o o« o O CO •TT — ' : y- " J? CO i ■ 1 fUi ya^^.IU ti: 1 yi uig >fe«: bifi' •T"' - ^^ I-* I-* CO to 1 g CO CO 00 00 1 -a ^_. -'I C3 • 1 w<^< ■^ - JC oo uv;ct; ni ^UOfi Ui ffi ^^viJt'if -i^ 1 • ■ - '-''51! ;' » Milol f1.»^H ^. Ifil/if. so J'll/) VKfX') >;>SW; ttO i^sid lit) •*^ .81- • 'JV^O. H 6v ji <5iii ^ol i :/i>^ 8S- : !.'!•> !<;: kxAMPLBs ros pkACticit. \i^ Marcll 1. — Commenced business with the R««ource^ and Liabilities as shown in Baliince account of last set^ — 2« Bought. of George Deshler on account 15 Bags of Coffee SdoO lbs. at 9c. ; 10 Bags of Rice 2000 lbs. at 5c. r-3. Sold Jsmes Bonner for Cash 15 Bbls. Flour at $10 ; 3 Bags of Coffee 600 lbs. at lOc— 4. Received fron^ John Martin, New- York, to be sold on his account and risk 15 ithds. of Sugar, 15000 lbs. invoiced at 8c. Paid freight on same in Cash $50. — 5* Sold Thomas Kellr t>n bis note at 7 dajs 25 Pairs of shoes at $2.50. — 'f. Shipped B. T. Stephenson, Boston, to be sold on our ac- count and ri»k 10 Bags of Coffee, 1000 lbs. at lOc, 5 Bags of Rice 500 lbs. at 6c. ; Paid Cash for Insurance oi^ same $15. — IQ. Bought of Michael Flood on our note at 86 days 300 Bbls. Flour at $9 ; and 2000 Bu. Wheat at 60 c— 11. Sold Frank Cunard for Cash lOHhds. of Sugar (Martin's ConsignmeVkt) 10,000 lbs. at lie— 12l Received Cash in full for Thomas Kelly's note of the 5th. ue this day. — 14. Sold Francis Harrington on bis note at days 2 Bags of Coffee 200 lbs. at 10c. ; 4 Bags of Rice, 400 lbs. at 6c.— 15. Sold John Bosworlh for Cash 5 Hhds. of Sbgar (Martin's Consignment; 5000 lbs. at lie— 2(h Received advice ^om B.^ T. 3tcpheoson, Boston, of the Sales of our Coffee and Rice shipped him on the 7th. inst. Our net proceeds of the same amount to $100, which h^ has remitted us in XDash. — 21. Closed Martin's Consign- ment and rendered him an Account Sales of the same. Our charges for Storage and Advertising 820 ; Commission at 2 per cent on $1650, $33.00. J. Martin's net proceeds $1547.00, which we remitted him in Cash.— 24. Receiv- ed Ca«h in full for F. Harrington's note of the 14th. in»t. due this day. — 27. Paid .Clerk hire and rent in Cash $150.-30. Paid our note of the, 10 inst. at 80 days fav- or of Michael Flodd in Cash $3900 lesb discount for 66 days $38.61. luTentoif of Merchandise unsold $4863. t Ut- .y">'T •>. fi'f tiiYi ^-.TJIMAXJf r o O :0I* jRih^n .^MclCi ".._.".; ^,. ; " i'il« tf|{>«>aOfi *? — "^ " -.^ " - '^ .tiOl Jfi .*
  • a- ' CO o o f" iO*f^itt ' mini ^ ;«} .:> t ®^ or 00* vii 8 erf !•. vO ? ■^^1, -fi'jiiiJiri'jjl/, , /m/ EXAMPLES FOR PRACTICE. 151 VH\ >^f.l '-i .Vik ApriL I. Commenced business with the following Besonroes : Cash on hand |2500 ; Merchandise per Inventory $5214.36. Notes on hand $2300 ; William Slacker's account $850. Liabilities : Smith & Sons* account $475. 50 ; King & McMahon^s account $287.50.— 4. Bought of Robert Johnson on my n6te at 90 days, Merchandise per Invoice-Book, amotmt- ing to $541.30.- 3* Sold P. J. Buckley on ac- count Merchandise as per S. B. amounting to $239.18—6. Bought of Thomas Hanratty on ray note at 90 days. Merchandise as per I.-B. amount- ing to $634 96.-8. Bought of James Mc Wil- liams on account, an Invoice of Herchandise aniounting to $213.14.-9. Sold Michael DHs- coll for cash Merdiandise as per S. B. amounting to $22 1.88. —Solid P. J. Buckley on account Mer- chandise as per S. B. amounting to $154.46. —10' D^sited Cash in Montreal Bank $2000. ~^11* Spid Charles Mooney on account Merchan- dise as per S. B. $602.82.— Sold Thomas Mc- Namara for Cash 2 pieces Calico 9 1 yds. at 94c. — -13. Sold Henry firophy on account Merchan- dise as per S. B $167.50-^14. Sold Chs. Anthon on account Merchandise as per S. B. $24.75.->— 15. Bought of J, J, Jones 200 Bbls. Superfine Flour at $10. Gave in paymieUt a Check on Mont- real Bknk for $1000 and my note at 30 day^ for balance. — 16. Sold J. F. O'Leary on his note at 90 days, Merchandise per S. B. $201.43.^17. Re- ^ ceived per Steamer Champion from T«Yrbnto,ian III- voiice of Cotton consigned to m* by James Mc Wil- liams io be sold on his i^ccount a)id risk, amount- ik SXAMPtSS FOB PRAOTICI. ing per Invoice to $170.80. Paid Cash for Freight Cartage, &c. $18.75. — 19. Shipped per Steamer Magnet and consigned to FranK Smith, TorQnto, to be sold on my account and risk 200 Bbls. of Su- perfine FloUr at $10. l^aid Caeh for Freight and Cartage $205.25.-20. Sold M. Drisipoll for Cash Merchandise per S. B. $164.50^ — 21. Spld Charles Mooney on account 1 Bale Qotton 450 yds. At 15c. ; 10 pieces Cassim^re 600 yds. at 62ic.-^ 22« Received for Petty O^sh Sales this month $896.58.-23. Accepted Smith & Co*s Draft on me iu favor of Francis Doyle .at 10 days sight for $475;5,0.-^2&. Deposited Cash ip Banlc of Mont- real $500.— 26. Paid.Ca^h for Store Expenses $l24i — 27* Bought of Charles Cunningham on ac- count, an invoioe oC Merchandise amounting to $406.-28. Sold Henry Br^phy on account Merchandise fts pec S, B.. $352^75. — ^^old John O'Leary on account ]!i(erchandise as per S. B. $227. — Sold P. J. Buckley on accp.u'nt, i piece Broad cloth 25 yds. at $4 ; 2 pieces dassimere 56 yds. at $2.-* 28. Sold Charles Mooney on ac- count 4 Bales. J. McWilliam's Cotton 1200 yds. at 3^c. — Received from Thomas tirant to be sold on joint account each one halt 5000 lbs Wool at Soc. ; uiy comniis^ion 5 per cent on sales ; paid Cartage &c. $2Q— Sold Henry Brophy on account the balance of Mc William's Cotton at $175.— 3d. Made out an account sales of J. McWilliam's con- signment : Our charge for Storage and Advertis- ing $15.75 ; our commission at 5 percent on $2 17; net proceeds $171.65.— Sold Thomas Patterson for Cash the 5000 lbs. Wool (Mdse. Co. A.) at 37^ c. — ^Closed Sales in company with Thomas Grant ^nd rendered him an account of the fame ^. puV i:i^AMPLE3 FOR PRACTICE. c])arges on Storage and Advertising $25 ; our com- mission at 5 per cent on $1875 $93.75 ; T. Granfs half Invoice $625; his half net gain $243.12^; our half net gain $243.12}. Balance of Merchandiife unsqld as per i^ veutory $3730.87. Balanoe Account. ' ' Resourcer. idabilititv. '>;•.' r. If y ^4erchaDdise per inv MoMahoD & King Cash VV-T-- Bills Receivable .,.,,.„ Bills Payable : Wm. Blacker P. J. Buckley..... J. McWilliams G. CuDningham T. Grant , Montreal Bank , C. Mooney ...^.... U. Brophy ,.,, .', C. Antnon...... ^ .^. Shipment to Tqronto ,...!.. J. O'Leary * ,,,, Stock ( preient worth) . . . . , $ 3730 2875 2501 850 605 1500 1087 "695 24 2205 "227 87 s 50 43 64 32 25 t5 25 16303 01 2P: 50 2651 384 496 1493 76 79 00 'H'i 10989 83} 7l 16303 ■r X {■ s ^^ tm '- ji.f , a V4 Ml t>fM«S • iivii.Vjti^i fit b&vi&tj.6wi M&y 2* Commenced business with the resourc* es' and liabilities as shown in balance account of last se( : Paid in Cash Smith & Son's draft oh me at 10 days sight accepted April 23rd^i $475.50.-8. Sold Francis McPherson on his lipte A\ 4 months. Merchandise &8 ppr S. B. 154 EXAMPLES FOR PRACTICE. amounting to $427.-4. Received of Charles Mooney Cash on account $500 — 5. Sold Michael DriscoU for Cash Merchandise per S. B. amount- ing to $250.— S.Bought of P. J. Lynch & Co. 100 Barrels Flour at $9.50 ; gave in Payment a Draft on William Blacker for $850 ; and Ca».h for the balance $100. — 9. Sold Francis Rourke for Cash Merchandise amonting to $22.65. — 10. Received from P.J. Buckley Cash on account $100.— Sold W. J. Stratton on account 5 Bbls. of Flour at $11. — 11. Paid Charles Cunningham's draft on me at sight $496. — 13. Received from Frank Smith Toronto an account Sales of the Flour consigned him on April 19lh. Net Pro- ceeds $2775.00. For which he has remitted a check on the Bank of Montreal. ^Sold Daniel Fitzgerald for Cash Merchandise as per S. B. $103.50.-14. Sold John O'Leary on account 1 Piece Carpeting 87 yds. at $1 ; 6 yds. Oil Cloth at 75c. — IS.Sold George McKeown for Cash 95 Bbls. Flour at $10.14.— 16. Sold Charles Mooney on account 1 Piece Carpeting 96 yds. at $1 ; 1 Piece do. 79 yds at 75c.— Paid in Cash my note issued April 4th. favor of R. Johnson at 3 months, face of note $541.30 Discount off $6.95.— 1?. Paid C. Anthon Cash on account $25. — Bought of J. J. Jones for Cash 125 Bbls. Fiour at $10, which I have sold to Dawson &, Major, N.-Y. at $11. Received in Payment Merchandise per Invoice- Book amounting to $1000; and their Dr^ft on George Smith at 10 days, $375.-19. Sold John A. Barton on bis note at 4 months. Merchandise per S. B. $480.-^20. Bought of P. J. Buckley a House and Lot on St. Lawrence Street for $1600 ; gave in paynfient, Cash $200 ; F. McPherson's EXAMPLES FOR PRACTICE. 155 V Note Received on 2nd. inst, |427, Check on Bank of Montreal $500, and Balance on account. — Received from W. H. Stratton Cash to balance account $55. — 24:* Henry Brophy has accepted my Draft on him at 10 days sight $695*25.— Bank of Montreal has Discounted the Note received from John A. Barton on the 19th Inst, at 4 months Face of Note $480.Di8Count off, $9.44.-^25. Sold H* Langton, the House and Lot on St. Lawrence Street for $2000 ; Received in Payment Cash, $1000 and an Invoice of Merchandise amount- ing to $1000.- Bought at Auction for Cash a quantity of Merchandise for $250 and immedi- ately sold it for $300.--26. Shipped per Passport and consigned to Hughes & Co., Hamilton 50 Bbls. of S. F. Flour, Bought of Bernard Mason Ion my note for 30 days at $1 1 ; Paid Freight and Cartage in Cash $52— 27- Henry Brophy has paid my draft on him $695.25. — 28- Bought of James McWiiliams on account an Invoice of Merchand- ise $173.50.-29. Cash Sales this month $3260.62. — Paid Store Expenses in Cash $426.25.— De- Iposited Cash in Bank of Montreal $ tOOO. — Paid Clerk hire $50. Balance of Merchandise unsold as per Invent- jory $2850.00. ym^-^fsiw " -^ a Si JXOIO ^l r' i\ la hi-M'K.iii li) a a -;) H it >i ■a fi-ll i^lfl m ;) u » n » mi .Kx 154 16c *.«•»-*-.... , EXAMPLES FOR PltACtlCt. ' Balance Account. R«8oarceii. Uabiiilieil. iu i-JU Merchandise per iny. ... Cash Bills Rec'd Bills Payable P.J.Buckley .;. McMahon & King J. MoWilliam^..... Montreal Bank....; C. Mooney a James Grant i C. Antbon J. 0*Leary Shipment to Hamiltoh. Stock ...i.. ,.....;*....;;. $ 2850 00 8512 28 2876 43 3154 32 64 287 558 2000 00 742 57 14&3 4^ 7S 318 50 602 13460 17984 17 17984: 96 50 29 12J 29J ^K>( EtRRA.xJx^ ••v. \ i P»ge 11, A. t< 29, 5 tt 29, 12 tt 26, 23 l( 45, 10 (( 62, 12 tt 98, 31 tt 138 , 9 tt 105, 22 tt 109, 10 tt 140, 4 tt 140, 6 tt 140, 7 tt 143, 9 tt 143, last ni 144, 14 to Q. 14, From the bill br invoice riceived* line instead of owned read owed. tt tt tt tt tt tt tt tt tt tt " and « deUt " they " therefore tt tt tt tt omit a " each 15c. '' instead of inmost " " " bound " " « $60 " « « $8688.13i « tt tt tt tt tt or, debt, it, - '' ' there/dr. rrlttsL bond, $61.23. $8888.1.3^. (( (( " insert words on account after Hanlon. line omit words on account, line instead of $101 read $386. sen. Liabiiiiieii. 00 28 43 3154 96 64 287 50 558 29 30 57 7S 14&3 12J 50 13460 29J 17 179841 17 'tf^n■ mice received* 7wed, 7r. debt t. herefdr. ^nd. $«1.25. $8888.l3j. 'ter Hanlon. ,»*»*''' -A-, y*' V j*f*- ^: .-• '■m ¥ 6. a. {•