^ IMAGE EVALUATION TEST TARGET (MT-3) 1.0 ^I2£l&i ^m |22 £ |i£ 12.0 1.1 L25 lu giA ^i^iH^iMi^i^ nilS^BH^^X RN^^^^H^B 6" Fhotographic dCiBOC^S GarpQFatiaii 23 VKIST MAM STRMT WniTIII,N.Y. 14SI0 '>^>\" O ^S^^ ^ ) »* firjif 4^' CIHM/ICMH Microfiche Series. CIHM/ICIVIH Collection de microfiches. Canadian Instituta for Hiatorical Microraproductiona / Inatitut Canadian da microraproductiona hiatoriquaa Tachnical and Bibliographic Notas/Notat tachniquas at bibliograpliiquaa Thfl tol Tha inatituta haa attamptad to obtain tha baat original copy avaiiabia for filming. Faaturaa of thia ropy which may ba biblionraphlcally uniqua, which may altar any of tha imagaa in tha raproduction, or which may aignificantly changa tha uaual mathod of filming, ara chackad balow. 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Thia itam ia filmad at tha raduction ratio chackad balow/ Ca documant aat film* au taux da reduction indiqui ci-daaaoua. 10X 14X 18X 22X 26X 30X ^ 12X 1CX 20X 24X 32X The copy film« J h«r« hat b««n r«produc«d thanks to tha ganarobity of: Seott Library, York Univaraity Tha iir jgas appearing hara ara tha baat quality poaalbia considaring tha condition and iagibility of tha original copy and In keeping with the filming contract specif icationa. L'exempiaire flimA f ut reproduit grice k ia g^ntrositA da: Soott Library, York Univanity Lea imeges suivantes ont AtA raproduites avac la plus grand soin, compta tenu de ia condition at da ia nattetA de rexempiaira filmA, at en conformity avec les conditions du contrat de fllmaga. Original copies in printed peper covers ara filmed beginning with the front cover end ending on the lest page with e printed or illustrated impres- sion, or the beck cover when appropriate. 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Meps, pletes, cherts, etc.. mey be filmed et different reduction retios. Those too large to be entirely included in one exposure sre filmed - beginning in the upper left hend cov tier, left to right and top to bottom, as many frames as required. The following diegrems illustrate the method: Les csrtes, pienches, tablaeux, etc., peuvent Atv9 filmfo A des taux de rMuction diff Arents. Lorsque Ie document est trop grend pour Atre reproduit en un seul clichA, ii est film* A pertir de i'angia supArleur gauche, de geuche A droite, et de heut en bee, en prenent ie nombre d'Imeges nAceeealre. Les disgrammes suivants iliustrent ie mAthode. 1 2 3 1 2 3 4 5 6 ^ Ga] I A COM PI THE co: n Cou S. G.'l The former Business i Chai I TENTJ P( THE Canadian Accountant y A PRACTICAL SYSTEM OF BOOK-KEEPING, — CONTAINING — A COMPLETE ELUCIDATION OF THE SCIENCE OF ACCOUNTS BY THE LATEST AND MOST APPROVED METHODS, BUSINESS CORRESPONDENCE, MERCANTILE FORMS, BANKING, INSURANCE AND OTHER VALUABLE INFORMATION. DESIGNED FOR THE USE OF COUNTING Houses, Business Colleges, academies, AND High schools. f 1 c: — BY- /, S. G. BEATTY/ and J. W/JOHNSON^ f.c.a. The former Founder (in 1868) and the latter one of the Principals (now 17 years) of Ontario Business College, BeLi-eville, Ont., Canada; one of the Examiners for the Institute of Chartered Accountants of Ontario, and Author of "Johnson's Joint Stock Co. Book-Keei'ing," and "Johnson's Promissory Notes and Hills of Kxchasge." TENTH EDITION. REVISED AN-D ENLARGED. PQbll3l)e% Ontario ^Q3ine$3 College, Belleville, Ontario, Canada. I^I^IOE, ^S.OO. BELLEVILLE: PRINTED BY THE INTELLIGENCER PRINTING COMPANY, (LIMITED.) 1894. ENTERED ACCORDING TO ACT OF THE PARLIAMENT OF CANADA, IN THE YEAR ONE THOUSAND EIGHT HUNDRED AND SEVENTY-FOUR, BY S. G. BEATTY, AND IN THE YEAR ONE THOUSAND EIGHT HUNDRED AND SEVENTY-NINE, BY S. G. BEATTY AND J. W. JOHNSON, AT THE DEPARTMENT OF AGRICULTURE. WARNING. The appropriating for other books of the matter herein contained^ without authority and acknowledgment, will be, as it has been, severely dealt with. BY PERMISSION, This Volume, in its tenth edition, is dedicated to HIS EXCELLENCY THE EARL OF ABERDEEN, GOVERNOR GENERAL OF CANADA. authority BY THB AUTHOBS. 1 PREFACE. lOrrn BIDITIOIT. ** The Canadian Accountant " stands now among the things that justify their own existence, and are fully and finally accepted. The possessors of the book will be gratified in knowing that it has a wider demand than any other work on book-keeping and accounts published in the English language. This gratifying fact is not the result of canvassing or undue pushing of any kind, but is the legitimate recognition of the successful efforts to make " The Accountant " the best text book for the student, and the most comprehensive and reliable work of reference for the practical accountant and business man. The aim of the authors has been to maintain the thoroughness which is charac- teristic of things Canadian ; to make the book worthy of association and identification with the splendid Educational System of the Province of Ontario. That association and identification was fully consummated on the establishment of the commercial specialists' course at the Provincial School of Pedagogy in Toronto, when " The Accountant " was adopted as the Book-keeping Text Book. "The Canadian Accountant" furnishes to the intelligent and industrious student a highway to the mastery of the science of accounts. There is no royal road to the knowledge of book-keeping more than to any other knowledge. It is alone by earnest study, well directed, that it can be achieved. Ontario Business College. ) Belleville, Ont., Canada, 1894. \ Abbrevlati( Account Sa Account Si Converte Accommodi Acceptance Actions at ] Addition . . . Administrati Advertising Advice of S Affidavit of Agreement i Alteration 01 Annuities., Appeals Application 1 Appropriatioi Arbitrations, Arithmetical Arrest for D Articles of C Assignments . Assets and Li Assessment , . Assignment Attachment o Auditing Auditors' Rep Average of Ai Average of Ac Balancing Ac< Balance Sheet S^nj^infi; Bank Stateme Bank Pass Bo Bank Checks a Bank Draft. Bill Book.,., , Bills in Suit Ac "'lis and Invoi< Bill for Service Bills of Exchan Bills of Lading Bills Payable.^ J Bills Receivable I Bills of Sale an IBill of Sale For JBoard Measure ■Bonds and Mori INDEX TO SUBJECTS. ^ their I wider English ly kind, untant " work of n A PACE Abbreviations used in the Work 9 Account Sales 6() Account Sales English, in Sterling;, and Converted to Canadian Currency 61 Accommodation Note 66, 226 Acceptance of a Draft 63, 267 Actions at Law 252 Addition 219, 323 Administrator's Form 120 Advertising Stock of Goods for Sale 315 Advice of Shipment 319 Affidavit of Execution 258 Agreement for Building a House 289 Alteration of Notes . 264 Annuities 250 Appeals 252 Application for a Situation 320 Appropriation of Payments 252 Arbitrations.... 252 Arithmetical Signs 10 Arrest for Debt 253 Articles of Co- Partnership 287 Assignments 253 Assets and Liabilities Statement 161, 235 Assessment 144 Assignment of Mortgage 275 Attachment of Goods. 253 Auditing . ... 194 Auditors' Reports 195 Average of Accounts 330, 332 Average of Account Sales 335 B Balancing Accounts 42 Balance Sheet 91 Banking 196 to 214 Bank Statements 205, 206 Bank Pass Book 208 Bank Checks and Check Book 208, 214 Bank Draft 213 Bill Book 54, 55 Bills in Suit Account 224 Bills and Invoices 56 to 59 Bill for Services 59 I Bills of Exchange 259 Bills of Lading . . 28; Bills Payable 20 Bills Receivable 20 I Bills of Sale and Chattel Mortgages 253 I Bill of Sale Form 276 ■Board Measure 340 I Bonds and Mortgages Payable acct 21 Pace Bonds and Mortgages Receivable acct ... 21 Bond 254, 273 Bricklayers' Work 345 Books as Evidence in Court 221 Books used in Double Entry 16 Book-Keeping for Churches and Public Institutions ,. 175 Book-Keeping fur Branch Stores and Agents 232, 233 Book-Keeping Entries for Mortgages 273 Books of Loan and Savings Companies. 238, 239 Business Forms 56 Business Letters 310 to 322 Business Series 49 Business Statements 90 Canadian Banking 200 Cash Account 19 Cash Book 71, 86, 109 to in, 238 Carpenters' Work 342 Cattle Weight by Measurement 350 Charges Account 21 Changing Single to Double Entry 82 Changing Double to Single Entry 84 Chattel Mortgage 278 Cheese Factory Milk Book 131 Circular Letter 321 Classified Statements 37 Classification of Accounts 39 Clearing House 21 1 Clearing House, remarkable eveut 212 Closing the Ledger 43 Combined Statement 76 Commercial Law 252 to 259 Comparison between the Double Entry and the Single Entry Systems 236 Common Carriers 254 Compound Partnership 354 Compromise with Debtors ... 229 Condensed System of Book-keeping for Retail Business 240 and 243 Consignments Explained ... 67 Continuous Balance Ledger 237 Contracts 2<;4 Contracts made by Letters 316 Contingent acct., or Suspense acct 229 Contract made by Letters 316 Cost Mark, Set of Characters for ... 218 Coupons 294,295 Correspondence and Composition 296 Correction of Errors 48, 220 Credit Note 59 Cross Entries 220 1 c D Page Day Book i6, 28 Day Book Index 240 Dealing! with Banks 208 Dealinc with Agents 233 Detection of Errors 47, 219 Deposit Slip 213 Debentures 294, 295 Debenture Register 145 Debtor and Creditor 16 Deeds 286 Delivery Order 183 Deposit Ledger 239 Dividend on Shares 72 Distribution of Gains and Losses in Part- nership 80 Distinction between Single and Double Entry 15. 81, 236 Discharge of Mortgage ... ... 276 Discounting Bills and Invoices 351 Discounting Notes and Entries 225 Dissolution of Partnership Notice ..... 356 Divisors for Circular Figures 348 Double Entry > ,5. 23 Double Equation of Accounts 332 Dower 255 Drafts 62, 67 Duties on Goods 231 Due Bills 64 Dunning Letters 311 B Entries for Renewals of Notes 221 to 224 Equation of Payments 330 Estimates Municipal Book-keeping 143 Etiquette of Letter Writing 307 Exercises in Ledger Accounts 18 to 23 Exercises in Journalizing Shipments and Consignments 68 Expense Account 21 Execution 255 Exemption 255 Expert Accounting and Practical Matters, 215 to 250 Evidence 255 Example of Single Entry 81 P Filing Business Papers 73 Filing Letters 304 Farm Accounts 163 Folding Letters 303 Form of a Letter 303 Forms of Business Papers 259 Freight Book, or Manifest 136, 137 Fuel Book 133 a Glaziers' Work 347 Gauging Casks 349 Good Will 77 Guarantee Companies 247 H Hands' Register 134 Hay, Figuring Cost of 33S How a United States Bank is Created, 198 to 200 How to arrive at a Just Settlement of Part- ner's Accounts where Books have not been kept by Double Entry 233 to 236 How to put Checks through the Cash Book 88 How to mark Cost and Retail Price on Goods 218 Z Parr Insurance, Fire 247 Insurance, Life 249 Insurance, Marine 249 Insurance, Character 247 Insolvency .... 256 Insurance Account 21 Interest and Discount Account ... 21 Index to the Ledger 32 Invoices 58 Invoice Book 107, 108 Indorsements 265 Interest ..... 256 Interest Journal 238 Interest by Cancellation 327 Interest (simple) 326, 327 Interest on Notes 268 Inventory of Stock .... . 29, 99 J Journal 17, 30 Journalizing 24 Journal Day Book 85, 105, 127 Journalizing Shipment Co. 'sand Merchan- dise Co. 's 94, 9) .Toint Notes 263 Joint Stock Companies . . . 186, 257 L Landlord and Tenant 256 Ledger 17. 32i 45 Leases 270 to 273 Letter inclosing Account Sales 319 Letter of Recommendation 320 Letter answering an Advertisement 320 Letter of Authority to Sign Business Papers 322 Letter Acknowledging Receipt of Shipment 322 Letter of Credit 260 Letters of Introduction 309 Limitation 256 Logs Reduced to Board Measure 340 Lost Bill or Note 269 M Making Collections by Drafts 227, 228 Manufacturing Business 122 Manifest 136,137 Marking Cost and Retail Price on Goods. . 218 Mason's Work 344 Mercantile Terms 10 Merchandise Account 19 Merchandise Companies 92 Measurement of Lumber 340 Measurement of Corn in Crib 349 Measurement of Grain 350 Measurement of Wood 338 Measuring Land 350 Mechanics' and other Liens 2i;6 Mechanics' Work 342 Mercantile Agencies 245, 246 Method of Writing off Bad Debts 226 Method of Keeping Bank Acct.in Cash Book 109 Millers' Rule for Weighing Wheat 339 Monthly Trial Balance 116 Monthly Journal .... 242 Mortgage 257 Mortgage Ledger 238 Mortgage, Form of 274 Monthly Statement 57 Municipal Accounts (42 Multiplication 324 Non-Resident Tax Book 145 Noting 284 Oblii^ation Ohtaming Opening ] stances . Order of C Orders . . Order for C Overdue B Partial Pay Painters' V Par of Ster Partnership Partners' t Account Partnership Partnership Passage Bo( Parties to a Pay Roll , Paying a Ni Payment of Personal Ac Plasterers' \ Plant .Accou Power of At Precis Writi Promissory ] Private Ledj Protests . . . Practical Co Principal Bo Profit and L Proposal to f Punctuation Questions fo Questions fo Questions foi Questions fo: Questions foi (,)uestions foi Questions foi Quit Claim Rapid Procei Rate of Ster: Receiving d due at a Bi Registration Registration Results of Ej Remarks on . Renewals of Renewals, ini Receipts ... Recommenda Situation . Reduction of Reduction of Replevin ... Reporting at Requisities ol Request for ti Request for tl Retail Mark, Rule ibr Jour Rules for Jou I'ACK Oblii^ations of Parties 364 Obtaining Assistance to Retire a Note .... 224 Opening Ledgers under various circum- stances 21510217 Order of Closing Accounts 42 Orders 64 Order for Goods 317, 318 Overdue Bills Account 224 P Partial Payments 328 Pointers' Work 344 Par of Sterling Exchange Explained 261 Partnership 80 ... 257, 353 Partners' Capital and Partners' Current Account 217 Partnership Settlements 355 to 368 Partnership Agreement 287 I'assage Book 1 34 Parties to a Bill or Note 263 Pay Roll 130 Paying a Note before Maturity .' . . 226 Payment of Notes 268 Personal Accounts 21 Plasterers' Work 344 Plant .Account 1 26 Power of Attorney 290 Precis Writing 250 Promissory Notes 65, 262 Private Ledger . 229 Protests .... 281 Practical Computations 323 Principal Books used in a Canadian Bank.. 204 Profit and Loss 328 Proposal to form a Joint Stock Comp'y .... 315 Punctuation 298 Q Questions for Review, Chap. I 23 Questions for Review, Chap. II 38 Questions for Review, Chap. Ill 48 Questions for Review, Chap. IV 66 Questions for Review, Chap. V 88 (Questions for Review Banking 207 Questions for Review Business Papers ... 293 Quit Claim Deed 287 R Rapid Process of Marking Goods 326 Rate of Sterling Exchange 261 Receiving Cash to retire Customer's paper due at a Bank 227 Registration of Vessels. 142 Registration of Instruments 258 Results of Exercises in Ledger Accts .... 22 Remarks on Notes and Bills 51 Renewals of Notes 54, 70 and 221 to 224 Renewals, including other Items 223 Receipts 61, 269 Recommendations in favor party seeking a Situation 321 Reduction of Dollars and Cents to Sterling. 369 Reduction of Sterling to Dollars and Cents 369 Replevin 258 Reporting at Custom House 142 Requisites of a Bill or Note 262 Request for the Renewal of a Note 316 Request for the Extension of a Note 317 Retail Mark, Set of Letters for 218 Rule icr Journalizing 25 Rules for Journalizing Drafts 64 8 Pace Sales Book 117 Sales Ledger 243 to 245 Shares Bought . . 69 Shipments Explained . . 67 Shipment Companies 92 Single Entry 78 Six Column Journal 96,100, 101 Simple Partnership 353 Sinking Fund, How to Levy 144 Slating Measurement 343 Specimen Ledger Closed 45 .Statement of Losses and Gains 37 Statement of Resources and Liabilities.. 38, 235 Steamboating Set 132 Stock Exchange 190, 193 Stock Ledger 239 Storage 336 Stock or Inventory Book 99 Stoppage in Transit 258 Subsidiary Ledger 175, 180 Suggestions to Depositors in Banks 209 Suggestions for Drawing Checks 209 Subrogation 258 Summary of Ontario Law 252 to 259 .Sundry Debtors Account 99 Superscription, Form of 308 Table for marking articles bought by the dozen 326 Taking charge of a Set of Books 215 Taxes 258 Tender 259 Tenders for Debentures . . 317 Tender for Stock of Goods .... 315 Time and Wages Register 128 Titles of Respect in Correspondence. . 305, 306 Titles (Searching) 259 Tiling Measurement 343 To close a Single Entry Ledger. . . 82 To show Settlements in Ledger Accounts without Ruling 228 To find the Cubical Contents of Round Timber 342 To find the Cubical Contents of Square Timber 341 Trial Balance 36, 160 Trade and Cash Discounts 218 Transfer of Notes and Bills 266 Transferring Accts. from an old Ledger to a new one ' 217 Trust Companies 246 United States Banking. Useful Contractions . . . 197 to 200 324 Vouchers . . , '95 W Waiving Protest 281 Warehousing Set of Books 183 to 185 Warehouse Receipt 183 Warehouse Ledger 184, 185 Warrant Book 145 Weekly Time and Wages Register 129 Will, Form of 289 Wills 259 Working Account 228 i I c: r TO THE STUDENT. ^■» The course of Htudy comprchcmled in this work is of the most useful iind practical nature. It is not designed simply for the merchant and the accountant, hut so arran(;ed as to be of incalculable advantage to all clnssos of the community— the farmer as well as the merchant, the mechanic as well as the professional man. As you commence these studies, remember they are worthy of your best energies, and require persevering application to thoroughly master them. You enter upon them for the purpose of acquiring an education that will fit you to transact business systematically. You should let it be a settled rule with yon never to proceed onward while anything remains unconquered behind. The implied compact between you and your teachers pledges both parties to a faithful performance of duty. It is, therefore, of the firrt importance that ycu should enter upon your labors with a thorough appreciation of your privileges and obligations. In the first place, you require to apply yourself systematically and faithfully, or the best instruction will avail you but little, Your teacher is merely your guide. He can locate your difficulty, and point out the path you are to pursue, but learning is the result of thinking, and no teacher can either think for you or endow you with thought. Do not be ashamed to confess your ignorance, or pretend to understand that which you. do not, for assumption of knowledge is the greatest stumbling-block to progress ; it becomes a perpetual rock ol offence to those who would gladly aid you if the way were clear. Do not ask for aid until you need it, which will be when, after faithful trial, you have failed in the attainment of the desired result, A teacher who will aid you sooner than ihis may mean to be kind, but is unthinking, and, in fact, doing you an injury. Do not measure your attainment from time to time by the number of pages over which you pass, but by the perfectness of your mastery over them. Do not under any consideration pass from one set to another without fully understanding the subject both in its general and special application. Your labor will not be purely and only intellectual. The Accountant requires a neat, legible, rapid style of penmanship. The intrinsic value of this accomplishment is beyond computation, and should receive the attention its importance demands. A good, expeditious hand-writing is one of the strongsst elements of promotion and success, and carries with it an indisputable reference. The collateral studies of Arithmetic, Composition, Correspondence, etc., which you will pursue in connection herewith, are essential to a thorough understanding of your duties, as well as to the completeness of your course of training, and should not be underrated. Make every arithmetical calculation yourself as you proceed. Rely upon no result stated in the hook until you have first made the computation on which it depends ; otherwise you will gain little from its perusal. What is worth doing at all is worth doing well. In solving the Examples for practice, exercise your orifu common sense in determining how each transaction is to be entered. Make yourself familiar with the most concise and business-like form of expression in recording your transactions and in your correspondence. Spell all words correctly. Pay the strictest attention to punctuality, neatness, accuracy and order. Accuracy in accounts is a cardinal virtue. It is less difHcult to fall into errors than to cotrect them. Therefore, Exercise all diligence to keep your Account Books neat, legible, promptly written up, and free from errors. TAKE CARE OF THE BOOK. The Canadian Accountant is not only a book by which the student can master the principles of accounts and cognate matters, but it is also a work of reference tor the book-keeper and accountant in actual practice, and for the business man in conducting his affairs. This combination of text book for the school and reference book for the office, in one standard volume of acknowledged authority and reputation, should cause you to handle the book with care, so that it may be in good condition when, after your school days are over, and having entered upon the duties and responsibilities of business life, you resort to it, as to an old and tried friend, for counsel, direction and guidance. A BUR Auv. Ac't. AiMKK. Am't. Ans. Apk. Ass'i). or h Aug. Hal JJ.-Ii. Hki.. Hii.Ls Pay. Bills Rec H'k. Jio'T. Bro't. Cap. C.-B. Co. Col'd. Com. Consg't Cr. C. O. D. C. I. F. D.-B. Dec. Dep. D'kt. I.^is. Div. Do. Doz. Dr. Drav. D'ys. Ea. E. E. E. & O. E. VOCABULARY —OF— AHRREVIATIONS AND MERCANTILE TERMS. ABBREVIATIONS- Auv. Adventure. Eno. English. Ac'T. Account. Ent. ICntry. Amrk. American. Ex. ICxample. Am't. Amount. ICXCH. Exchange. Ans. Answer. Exp's Expenses. Apk. April. Ass'i). or As'i). Assorted. Fav. Favor. Auc. August. Feb. February. Fi(i't). Figured. Ral Balance. FOL. Folio. R-B. Bill Book, Bank Book FORW'l). Forward. Hbi.. Barrel. I'R. From. Bii.i.s Pay. or B. P. Bi'is Payable. Fr't. Freight Bills Rec. or B.R. Bills Receivable. F. O. B Free on Board. B'K. JJank. F. O. C. I'ree on Cars, r.i.'K. Black. Jio'T. Bought. Gal. Gallon. Bro't. Brought. Guar. Guarantee. Cap. Capital, Chapter. Hhd. Hogshead. C.-B. Cash Book. Co. Company I.-B. Invoice Book. Col'd. Colored. [rce. I.-E. (Id est) That is. Com. Commission, Comme- Ins. Insurance. Consg't Consignment. Insol. Insolvency. Cr. Creditor or Credit. Inst. (Instant) The present C. O. D. Collect on Delivery. month. C. I. F. Cost, Insurance and Int Interest. Freight. Inv't. Inventory. D.-B. Day Book. Jan. January. Dec. December. Jour. Journal. Dep. Deposited J. F Journal Folio. D'kt. Draft. Dis. Discount. LaI!. Labor. Div. Dividend. Lhs. Pounds. Do. (Ditto) The same. Led. Ledger, Doz. Dozen. L. F. Ledger Folio. Dr. Debtor or Debit. L. & G. Loss and Gain Dray. Drayage. D'ys. Days. Mar. March. Mdse. Merchandise. Ra. Each. M. or Mo. Month. E. E. Errors Excepted. Mots. Molasses. E. & O. E. Errors and Omissions Excepted. Mux. Mutual. I 1 c: r 10 N, B. (Nota Bene) Take notice. St'r. Steamer. No. Number. Stor. Storage. Nov. November. Sund's Super or S. Sundries. F. Superfine. Ocr. October. O. I. B. Outward Invoice Hook. Ult. (Ultimo.) The last. P. Page. Viz. (Videlicet.) To wit, nam Par. Face Value. Vs. (Versus.) Against. Pav't. Payment. P.-C.-B. Petty Cash Book. Weigh. Weighing. P'D. Paid. P'k'g's. Packages. Y'ds. Yards. Per. Personal. Yr. Year. Pr. (Per) By. pR. CT. (Per centum.) By the hundred. . Prem. Premium. ® At. Prof. Profit. % • (Per centum.) By the Prox. (Proximo.) The next month. hundred. Ps. Pieces. + Sign of Addition. " Subtraction. Rec'd. Received. X " Multiplication. R.-R. Rail-road. T" " Division. " Equality. S. B. Sales-Book. (I (Ditto.) The same. Sept. September. P One and one-quarter. Sh. Share. !=■ One and one-half. Ship't. Shipment. V One and three-quarters. MERCANTILE AND LEGAL TERMS. Aliatement — A deduction of discount for damages on goods, or for payment of demands before due, etc. Acceptance — ist The receiving of a draft or order, in such a way as to bind the acceptor to payment. It consists in the acceptor writing across the face of the bill "accepted," and signing his name. If drawn payable at a certain number of days' sight, the date of acceptance should also be given. 2nd A draft accepted. Accommodation — A loan of money. When applied to bills of exchange, it is where the drawee lends his name for the use of the drawer. Account Current — An exhibit in detail of a running account between two or more parties. Account Sales — An exhibit of the sales of goods disposed of on commission, with the charges incurred thereon. Ad Valorem — According to value. An ad valorem duty is a certain percentage on the first cost or invoice price. Advance — Additional price ; profit ; premium. Money paid on property or goods accepted, or on goods held in possession for security. Adventure — Goods sent to a distance to be sold on commission. - . - Advice — Mercantile Intelligence. Alias — Otherwise. Annuity — A sum of money payable periodically, usually yearly. Ante-date — To date before the present time ; to date beforehand. Arbitration — The hearing and determination of a cause between parties in a controversy, by a person or persons chosen for the purpose. A hearing before arbitrators, though they make no award. Assets — Available means for payment of debts ; (.^oods, estate, and indebtedness of others. Assignee — One to whom an assignment is made. One appointed or deputed for some specific purpose. Assignment — Conditional transfer of property to another. The property so transferred. Assignor — One who makes an assignment. Attachment — A claim on property legally executed. Ai'ie — A French cloth measure, one yard and a quarter. Average — Sums allowed for losses at sea. A medium time found by equation. Bailor — One who delivers goods to another in trust. Bailee — The person to whom goods are committed in trust. Balance— accoi Bankrupt Bill, or B Bills— A t Bill of En Bill of E) anoth Bill of La pursei BillofSah Bill of Stoi Blank Cre< amour Bona fide- Bond— An or a cc Bonded Go Bottomry 1 Brace— A n Broker — A Brokerage - Capital— St Capias— A ' Cargo— Th< Carrying Tr Charter Pan charters Circular Let Clearing a V sail, anc Clearance — j Closing an A is closed Collateral—; Commission^ Compound- amount. Compromise- Consignee — < Consignment Consignor — ' Contraband ( Contra— On Convoy— Shi Co-partnershi Counter Ord< Credit— That The amo Custom-house goods ar< I>ays of Grac States an drawn at Debenture—^ money. Debit— That s Defalcation- Demurrage — ] Depot— A pla Deviation— Tl of the spe Discount— An future tim Dividend- Ga Dock— A plac Draft— An ore Drawer— The Drawee— The I Drawback— A Duplicate— A 11 namely the n. tion. rter. arters. re clue, etc. payment, his name, be given. awee lends res incurred first cost or pted, or on by a person lo award. ime specific Balance — To close an account in the Led^^er. Difference between the debits and credits. An account in the Ledger, into which all balances are closed. Bankrupt — Insolvent. One unable to pay his debts. Bill, or Bill of Parcels — A statement in detail of goods bought or sold. Bills — A term applied to drafts, notes, etc. Bill of Entry — A list of goods entered at the Custom-house. Bill of Exchange — An order for the payment of money ; usually applied to drafts on persons in another country from the drawer. Bill of Lading — A written account of goods shipped, having the signature of the master, agent or purser of the vessel on which shipped. Bill of Sale — Evidence of ownership given to a purchaser. Bill of Store — A custom-house License for carrying to sea ship-stores and provisions Iree of duty. Blank Credit — Permission granied by one house to another to draw on it at pleasure to a specified amount. Bona fide — In good faith. Bond — An obligation or deed by which a person binds himself, his heirs, executors and administrators, or a company, or corporation bind themselves to pay a certain sum on or before a certain day. Bonded Goods — Goods imported on which the duties have not been paid. Bottomry Bonds — A mortgage or lien upon a vessel. Brace — A measure of _J^ of a yard ; a pair. Broker — A money or stock trader. Factor ; agent. Brokerage— A percentage for the purchase and sale of money and stocks. Capital— Stock in trade. Capias — A writ to authorize the seizure of a defendant's person. Cargo — The lading or freight of a vessel. Carrying Trade— The transportation of goods by a vessel from country to country. Charter Party — A written agreement between the owner of a vessel and the person .o whom she is chartered. Circular Letter — A printed notice issued by a house, relative to its business. Clearing a Vessel — Entering at the Custom-house all particulars relating to her when she is ready to sail, and paying clearance charges. Clearance — A certificate from a Custom-house that a vessel has been cleared. Closing an Account — Making an entry to balance it, and drawing lines underneath to indicate that it is closed. Collateral — Additional ; as collateral, or concurrent security. Commission — A percentage allowed for the sale of goods. Compound — To settle with a creditor by agreement, and discharge a debt by paying part of its amount. Compromise — An adjustment of difference by mutual concession. Consignee — One to whom goods or wares are consigned. Consignment — Goods sent to an agent to be sold for the consignor. Consignor — The person making a consignment. Contraband Goods — Articles prohibited by the law to be imported or exported. Contra- On the other side ; opposite. Convoy — Ships of war sailing with other vessels as a protection. Co-partnership — The union of two or more persons for purposes of trade. ' Counter Order — A revocation of a former order. Credit — That side of the account which shows the amount due to the person or thing represented. The amount of confidence reposed in another. Custom-house — The house where vessels are entered and cleared, and where the duties on imported goods are paid. Days of Grace — The days allowed for the payment of a bill after it becomes due. In the United States and in Great Britain and her dependencies, the number of days of grace is three. Bills drawn at sight are usually paid when presented, without grace, although entitled to it. Debenture — A writing acknowledging a debt, a Bond on which Companies or Municipalities borrow money. Debit — That side of an account which shows the indebtedness of the person or thing represented. Defalcation — Failing to meet obligations. Demurrage — Forfeit money for detaining a vessel beyond the time specified in her Charter-party. Depot — A place where goods are deposited ; a depository ; a magazine. Deviation — The voluntary departure of a vessel without necessity, from the regular and usual course of the specific voyages insured, which frees the underwriters from obligation. Discount — Any deduction from the stipulated price of goods, or from a sum due or to be due at a future time. Dividend — Gains on stock, shares in trade, etc. Dock — A place to build, repair or lodge vessels. Draft — An order from one person on another for the payment of money ; a bill of exchange. Drawer — The one who draws a bill or draft on another. The maker of a note. Drawee — The person on whom a bill is drawn. Drawback — Amount paid back. Any loss of advantage, or deduction from profit. Duplicate — A copy. I c: .i*' 12 Duress — Constraint, or force. Duty — A government tax on exported or imported goods. E. G. Exempli gratia — For tlie sake of example. Effects — Money, property on hand, and debts due. Embargo — A restraint on ships by Government ; or prohibition of sailing either out of port, or into port, or both. Emporium— A mart. A town or city of trade ; particularly a commercial city. Endorse— To write one's name on the back of a bill ; to become security for its payment. Entry — A record made in an account book. The depositing of a ship's papers at the Custom-house to procure license to land goods. Engross — To monopolize ; to purchase the whole or large quantities of commodities in market, so as to enhance the price. Equity of Redemption — The advantage allowed to a mortgagor, of a reasonable time to redeem lands mortgaged. Ex-cfticio — By virtue of his office. Exchange— The giving of one commodity for another. The place where the merchants, bankers and brokers meet, .-xt certain hours, to transact business. Discount and premium arising from the purchase and sale of bills and money Ex-parte— On one part. Face — The amount for which a bill is drawn. Fac simile— An exact copy. Factor — An agent employed by merchants to buy and sell, or transact business on their account. I'ailure — A breaking or becoming insolvent. Favor — A bill is said to be drawn in favor of the person to whom it is payable. Finance, or Finances — Revenue : funds in the public treasury. The resources or income of individuals. Financier — One skilled in money matters. A revenue officer. Firm — The name or title under which a company transacts business ; a partnership, or house. Flat — Low (as in the prices of goods) ; or dull (as to sales). Foreclose— To foreclose a mortgage is to cut a mortgagor off from his equity of redemption. Folio — I'age of an account book ; both the right and left hand pages expressed by the same figures. Freight — Lading ; that which is carried by carriers. Sums charged by a vessel for the transportation of goods. Good Will — Bonus paid for a business. Guarantee, or Guaranty — Idemnity or security against loss ; a pledge for the fulfilment of stipulations. Guarantor — one who binds himself to see the stipulations of another performed. Gratis — For nothing. Habeas Corpus — (a writ in law) you may have the body. Honor — As applied to drafts, means to accept and pay when ('me. Hypothecate — To pledge, to give as security. Hypothecated— Pledged, as security for money borrowed. H C. J.— High Court of Justice. Importation — The bringing of goods from another country to one's own country. The commodities imported. Insurance— Security against loss. The premium paid for insuring property or life. Insolvent— Not having money, goods or estate sufficient to pay all debts. A debtor unable to pay his debts. Instalment — A part of a sum of money paid, or to be paid, at a particular period. Interest — A percentage paid for the use of money. International — Relating to the mutual intercourse between different nations. Inventory — An account in detail of property. Invoice — See Inventory. Inventory is generally applied to a catalogue of goods on hand ; Invoice to goods purchased, received from abroad, or about to be shipped. Ipse dixit — He himself said it. . Labor Omnia Vincit — Labor conquers everything. Landing Waiter — A custom house officer whose duty is to wait or attend on the landing of goods. Lease — A contract granting possession of property for a stipulated time. Letter of Attorney — A writing by which one person authorizes another to act in his stead. Letter of Credit — ix letter authorizing one to receive funds on the credit of another. Letter of License — A written permission for a person under embarrassment to conduct his business for a time without molestation. (L. S.)Locus Sigilli— The place of the seal. Letter of Marque — A written commission or authority given by Government to private vessels, to | make reprisals on the vessels of another nation. 1. labilities— Debts of an individual, or claims against him. License — A legal permit to sell certain articles of merchandise. Lien — Legal claim, as a lien upon land, houses, etc. Lighter — A craft used to lighten vessels in shoal water. , Lighterage — A charge for carrying goods to and from a vessel in a lighter. Liquidation — The Act of adjusting and paying debts. Winding up a business. Liquidator — One to whom the winding up ol a business is intrusted. Locum ter Manifest- Mandamus Mart — A p Maturity— Maximum- Merchandii Metre — A i Minimum- Minutiae — ' Mint— A pi Mortgage— Mortgagor- Mortgagee- Nem. con.- Net proceed Net weight- Nolle prose( Non-claim- Notary, or ^ also to I Note— A wr Obligation— ment. Obligee— Th Obligator—"] Order— A re another Tar of Excha weight a Partnership- Payee— The ] Per Annum— Per Pro— Per Per Se - By i( Policy, or Pt insured is Portage— The Postdate— To Posting— Trai Power of Attc Premium— Be Price Current Prima Facie- Principal— Th tion to inl Primage— A p Procuration — business f Pro Tem pore- Pro Forma—/ Promissory Nc Protest— A no , paid wher Quantum— Ho Quarantine— K , , tion that s Quid pro quo- Quo warranto? Kate of Exchai Rebate or Reb Receipt— A wr Remittance— F Renewal of a I: Resources— Fu R. S. O.— Rev I Salvage— A re\ I Schedule— A p I Sea-worthy— F ISeize- To take I 13 , or into im-house arket, so em lands ikers anil from the )unt. income of se. J figures, nsportalion lipulations. ommodilies able to pay Invoice to f goods. s business for 1 e vessels, to I Locum tcnens— A deputy or substitute. Manifest — An exhibit of the vessel's cargo. Mandamus — We order ; a law writ. Mart — A place of public sale and traffic. Maturity — The time when a bill falls due. Maximum — The highest price of an article. Merchandise— The usual articles of trade. Metre — A measure of ii- 12 yards. Minimum — The lowest price of an article. Minutiae — Trifles ; minute parts. Mint — A place where money is coined. Mortgage — The grant of an estate in fee, as security for the payment of money. Mortgagor — The person who grants or pledges property for security of del)t. Mortgagee — The person to whom an estate is mortgaged. Nem. con. — Abbreviation for nemine contradicente— Without op])osition. Net proceeds — The remainder after deducting all charges from the amount of gross sales. Net weight — The weight of a commodity after deducting tare and all other allowances. Nolle prosequi — To be unwilling to proceed. Non-claim — A failure to claim within the time limited by law. Omission of claim. Notary, or Notary Public — A person legally authorized to attest c(jiUracts or writings of any kind ; also to take note of the non-payment of bills, promissory no'.es, etc , which is called protesting. Note — A written obligation to pay money ; a memorandum. Obligation — Indebtedness. A bond with the consideration annexed, and a penalty for non-fulfil- ment. Obligee — The person to wliom another is bound. Obligator — The person who binds himself or gives a bond to another. Order — A request to deliver or pay to a person certain moneys or goods. Any rc(iuest made of another in writing. Par of Exchange — The intrinsic value of money when compared with that of other countries, both in weight and fineness. The nominal value of a pound sterling. Partnership — See Co- Partnership. Payee — The person to whom money is to be paid. Per Annum — By the year. Per Pro— Per Procuration. Per Se- By itself. Policy, or Policy of Insurance — The writing or instrument by wliich a contract of indemnity to the insured is effected between him and the insurer. Portage — The incidental sums paid by a Captain in running his vessel. Postdate — To date after the real time. Posting — Transferring the Journal entries into the Ledger. Power of Attorney — Written authority given to a person to act for another. Premium — Beyond the face value. Price Current — A list of various articles of merchandise, with their market values. Prima Facie — On the first view, or appearance. Presumptive evidence. Principal — The chief of a commercial house or firm. Capital sum due, lent or owed, in contradistinc- tion to interest. Primage — A percentage allowed to the master of a vessel on the amount of freight transported. Procuration —The act of procuring. The instrument by which a person is empowered to transact business for another. Pro Tempore — For the time. Pro Forma — According to form. Promissory Note — A writing which contains a promise for the payment of money unconditionally. Protest — A notary's document, declaring that a bill was not accepted when presented, or was not paid when it fell due. Quantum — How much. Quarantine— Restraint of intercourse to which a ship is subjected, for a limited term, on the presump- tion that she may be infected with a malignant contagious disease. (Juid pro quo — What for what. Quo warranto? — By what warrant ? (a legal writ.) Kate of Exchange — The percentage above or below the par value of a Bill of Exchange. Rebate or Rebatement — Abatement of price ; deduction lor prompt payment. Receipt — A writing acknowledging tlie receipt of money or goods. j Remittance — Bills of money sent from one house to another. The act of sending the same. Renewal of a Bill — Prolonging the time of payment by making a new bill. I Resources — Funds, money, or that which may be converted into supplies. See Assets R. S. O. — Revised Statutes of Ontario. Salvage — A reward allowed for saving property from loss at sea or by fire. Schedule — A piece of paper or parchment containing an inventory of goods. I Sea-worthy — Fitted in every respect for a voyage. [Seize — To take possession by virtue of a warrant, or legal authority. c 10 14 Set of Exchange — A number of Bills of Exchange (usually three), drawn of the sane tenor and date. Each Bill is forwarded by a different conveyance, to prevent failures, and one of them being paid the remainder are of no value. Shipment — Goods on board a vessel. The goods shipped. Sight or at Sight — The time when a bill is presented to the drawee. Signature-:-The name of a person written or subscribed by himself. Sine die — Without fixing the day. Sine qua non — Without which a thing cannot be ; hence an indispensable condition. Smuggling — Passing goods into a country clandestinely, without paying duties. Solidity — The estimate a mercantile house bears as to property. Solvent — Able to pay all debts. Spot Cash — Cash at once ; no time allowance. Staple Goods — The principal products of a country. Goods not liable to perish. Stock — Capital invested in trade. Goods on hand. A Ledger title used instead of Proprietor's Name. Subpoena — Under a penalty. A writ summoning a witness. Surety — Security against loss or damage. One bound for payment of another's debts ; bondsmen ; bail. Tare — An allowance for the weight of boxes, barrels, etc., in which merchandise is put up. Tariff — A list or table of duties or customs on mdse., imported or exported. Teller — An officer of a bank employed to receive deposits or pay money on cheques. Tide Waiters — Officers who watch the lading and unlading of a vessel, to secure duties, as a check on contrabrand trade, etc. Tonnage — The weight or measurement of goods carried in a vessel, or the capacity of a vessel. Transfer — To carry from one account to another. To make over ; to convey from one to another. Trustee — A person to whom anything is committed in trust. Underwriters — Persons who insure property against loss. Usury — Formerly interest ; in present usage, illegal interest. Vice- Versa — The terms being exchanged. Voucher — A book, paper or document, which serves to vouch the truth of accounts ; a receipt. Wharfage — Money paid for the use of a wharf. Booi that a clej Ever; some kind and the di person wit memory al There the other j In Sir or credit si( in the Ledj account; tl Entry embi found at p£ The 01 much spect ascertained and other t( earlier daie credit belon the explana The sy account of i but in addit exactness, a accrue. In losses, are s tially gather The irn record of de whereas. Do record that their respect BOOK-KEEPING. CHAPTER I. Book-keeping is the science of recording business transactions in such a manner that a clear and correct statement of affairs is always shown. Every person engaged in the ordinary pursuits of life should keep a book of some kind in which to record his business transactions. The farmer, the mechanic, and the day laborer, as well as the merchant, should keep an account with every person with whom they deal, and not trust transactions of a pecuniary nature to memory alone. There are two methods of Book-keeping ; the one is termed Single Entry, and the other Double Entry. In Single Entry each transaction is entered but once in the Ledger, to the del>it or credit side of an account ; while in Double Entry each transaction is entered twice in the Ledger, to the debit side of one account and the credit side of some other account j that is. Single Entry consists of but one debit or one credit ; while Double Entry embraces both a debit and a credit. A fuller explanation of the principle will be found at page 26. DOUBLE ENTRY. The origin of the science of Double Entry Book-keeping has been a matter of much speculation by different writers on the subject, but nothing definite can be ascertained respecting it. It is said to have been first practised in Venice, Genoa, and other towns of Italy, where trade was conducted on an extensive scale, at a much earlier date than in England, France, or other parts of Europe. To whomsoever the credit belongs, the Italians have pretty generally received it, and the system shown in the explanatory set given here is usually denominated the Italian method. The system of keeping books by Double Entry is much to be preferred, on account of its greater accuracy. It not only affords a proof of its own correctness, but in addition to showing the condition of business, gives also, with mathematical exactness, an indication of the particular channels through which gains and losses accrue. In Double Entry, all the results, including resources, liabilities, gains and losses, are shown in the Ledger, while in Single Entry the results attainable are par- tially gathered from auxiliary books, such as the Cash Book, Bill Book, &c. The main distinction between the two systems is, that Single Entry is merely a record of dealings with persons, and the Ledger contains only personal accounts ; whereas, Double Entry is not only a record of dealings with persons, but also a record that exhibits all the Resources and Liabilities, and the gains and losses through their respective Ledger Accounts. Double Entry should commend itself at once to I 1 c: all prudent business men ; for, while it may properly be regarded as affording a true indication of the comparative merits of the various schemes of profit, it also, in a great measure, guards against errors and omissions which might pass undetected in Single Entry. Another important consideration in this connection is, that an indi- vidual or firm may engage in various kinds of business, or may divide a large business into various departments, and in the same set of books, by Double Entry, tell what each branch gains or loses. This knowledge could not be obtained by Single Entry. The leading feature of Double Entry is the theory of equal debits and credits, that is : every debit must have a credit of equal amount, and every credit a debit of equal amount. DEBTOR AND CREDITOR. One of the great difificulties that besets the student on commencing the study of accounts is a proper knowledge of the meaning of the terms "Debit and Credit." A simple meaning of debit is to charge, and of credit to tntst. Whenever one person receives anything from another, which he does not pay for at the time, he is said to go in debt for it, and is called a Debtor. A person who sells property without receiving his pay at the time is said to give credit, and is called a Creditor. In other words, the receiver is always the debtor, and the giver the CREDITOR. In keeping accounts it is customary and more convenient to abridge and write Dr. for Debtor, and Cr. for Creditor. A business transaction consists in the exchange of one thing for another. In every transaction there must be both a buyer and a seller. When the property which exchanges hands is not paid for at the time of the transfer, the buyer becomes a Debtor, and the seller a Creditor. The following will serve as an illustration of the correct use of the terms already employed : Transaction.— yi7//« Smith buys of Thomas Jones one suit of clothes, for tvhich he agrees to pay him hereafter twenty dollars. In this transaction John Smith is the debtor, or receiver ; and Thomas Jones the creditor, or giver. BOOKS USED IN DOUBLE ENTRY. The Italian method of keeping books by Double Entry has been adopted in the first sets of this Work, because it is the basis of all other forms, and therefore the best from which to learn the first principles of the science. The main books of entry are Day-Book, Journal and Ledger. Other books are introduced further on. DAY-BOOK. The Day-Book, in the Italian method, is a plain history of business transactions written in the dale and order of their occurrence. It is necessary to open the Day- Book by giving therein a statement of your effects at the commencement of business, and also what debts you owe if any. Afterwards record in detail e 'ery transaction that occurs in the course of business, making the entry in as few words as possible, but having it complete. Every entry should embrace the following particulars : ist, the date; 2nd, the person or account; 3rd, what you have bought or sold, paid or received ; 4th, the terms of payment ; 5th, the articles, quantities, prices and amounts. In writing this book, everything should be clearly expressed in as uniform a style as possible, and the use of ambiguous words and phrases carefully avoided. The liook and which is collected The 1 The : which all 1 principal i The i inj; at any with that I find withoi credit wen Ledger is i The f record of t Note.— Km .iiithors have m.i< Iiuruse with a des style adopted ins 17 JOURNAL. The Journal is used for arranging under Ledger titles the entries of the Day- liook and for affixing to each Ledger title the correct amount of debit or credit, which is called journalizing. This is done that the accounts tnay with ease be collected under their proper heads in the Ledger, LEDGER. The transferring of accounts from the Journal to the Ledger is called posting. The Ledger may be appropriately termed the ,;vv?//^/ reservoir of accijunts, into which all records in the other books flow as naturally as streams into the ocean. Its principal use is to collect under one head all sums belonging to the same account. The advantages of having the items of accounts thus collected are, that, by look- ing at any person's account in the Ledger you can see at a glance your whole dealings with that person, and also the balance which is due him or you, which you could not find without much trouble and great liability to error, if the amounts of debit and credit were all left standing scattered through the Uay-JJook. An account in the Ledger is a record of one or more items arising from business transactions. The following examples of these separate books, showing their characteristic record of the same transaction, will indicate their use : — L DAY-BOOK. Bclkville, January /, iSg4, n c 3 C Bought of Jamfs Smith, on account, 500 bbls. Flour at .$8 Sold Stkpiien Brown, for cash, 100 bbls. Flour at Q .$850 $4000 850 c u U 2. JOURNAL. Belleville, January i, iSg4. Dr. Cr. I 2 Merchandise, I)r To James Smith 1 $4000 $4000 i 3 I Cash, Dr T3 Merchandise | 1 Ledger Titles— Dr. Ledger Titles— Cr. oa rt Q 850 in C u 850 ba c Note. — Knowing from experience tlie .^dvantage to be derived from .^doptirlg the direct address in teaching, the authors have made use of pronouns of the first and second person, instead of the tliird, and are confident that tliose who peruse with a desire to obtain information will be pleased that all formality has liecn laid aside, and the conversational style adopted instead. 4 c Dr IS 3. LEDGER. Merchandise. Cr. 1894 Jan. n Q To James Smith. For what debited 1894 I $4000 Jan. 2 V Sf Cl< e4 tn J3 a rt j2 ■2 I Q g 'J 1 By Cash . For what credited I $850 d tt "J Ph ^_ d Im E 5 Q a V U Z?r. James Smith. 2 1894 Jan. Uy Merchandise. $4cxx} z;r. Cash. 3 Cr. 1894 Jan. To Merchandise. I $850 LEDGER ACCOUNTS AND EXERCISES THEREON. In Book-keeping we name our goods Merchandise, we call our money Cash, a house and lot Real Estate ; these terms used as ledger titles are called accounts. The purpose of the exercises, in connection with the following explanation of the various accounts which occur in the most simple business operations, is to eluci- date the initial difficulties of the science. , - We have found by experience that it is almost impossible to make a pupil who has no knowledge of the subject understand the Journal, until he is made acquainted with the nature of the accounts in the Ledger. How, for instance, can we explain to a beginner such an expression as " Cash Dr. to Stock," but by taking him to the Ledger, and there explaining to him the Cash and Stock Accounts, the manner of keeping them, and the object for which they are kept ? Until he has the Ledger explained to him in some way, the language of the Journal must remain unintelligible to him ; and to this may be ascribed the ill-success in teaching Book-keeping from some of the treatises in use in our public schools ; in which, after bewildering the pupil with rules and lectures upon journalizing, they conclude with what ought to be first explained — the Ledger. A faithful adherence to the instructions given on the following Ledger Accounts will enable the learner to record, readily and correctly, the exercise in connection with each ; which should be written on a Skeleton Ledger, ruled by the pupil himself, similar to the following form : — Note.— The 1 19 ft fi o o V Q U Cash Exercisk.— Commenced business with a cash capital of $8,500. Bought merchandise and gave in payment cash $1,500. Borrowed of A. B. $300. Paid rent of store $25<- Lent W. Snow $300. Sold for cash a bill of goods amounting to $1,000. Ri'quirfd, The amount of cash on hand ? ' Dr. Cash. Cr. $8500 300 1000 $1500 250 300 Bal. on hand 7750 $9Sco $9800 CASH ACCOUNT. This account is kept to show the amount of cash received, the amount paid out, and the balance on hand at any time. All amounts of cash received are placed on the deint (left hand) side of this account, and all amounts paid out on the credit (right hand) side ; consequently the de/ni side shows the amount received, and the credit side the amount parted with. The Balance on Hand is ascertained by deducting the total credit from the total debit. The debit side is always the larger as long as there is any cash on hand, since cash must be received before it can be paid out. This account is closed " By Balance.'" Exercise— CASH ACCOUNT. Cash invested $12,000. Paid for rent $400. Borrowed of George Sherry $175. Paid for merchandise $6,500. Received for merchandise $400. Received from (leorge Sherry $100. Paid on our note $250. Received on B. Canniff's note $400. Ixnt W. Ross $200. Paid George Sherry $275. Lost $100. Received from W. Ross $100. Received from A. C. Baker $250. Paid for coal $40. Required, the amount of cash on hand ? MERCHANDISE AND OTHER SIMILAR ACCOUNTS. The merchandise account is kept to show the cost and proceeds of merchandise, and, as a consequence, the gains or losses thereon. Merchandise is debited with the amount on hand on commencing business and with the cost of all purchases. It is credited with all sales of merchandise ; consequently, the deint side shows its cost, a^d the credit side \i% proceeds. When all has been sold, the difterence between the two sides will be a gain or loss. If a portion of goods remains unsold, the account must be credited with this balance, prior to closing, as an off-set thus far against its cost. If the 935 ••n. "-Total Credit. " I)ei)it. Tresent worth, S.500 1,400 7,100 Questions for Review. CHAPTER I What is nook-keeping ? How many distinct methods of keeping accounts are there? Give a distinction between Single and Double Entry ? Why is the Double lintry system to be preferred ? What do the terms " Debit " and " Credit " signify? When is a person called a Debtor? When is a person called a Creditor? What is a business transaction ? What are the main books used in Double Entry ? Describe the Day Book. For what is the Journal used ? What is posting ? What is the Ledger ? and what is its principal use ? What are the advantages of keeping Personal I Accounts in the Ledger? What is an account, as used in the Ledger? What is the I object in keeping a Cash Account in the Ledger ? When are entries made on the Dr. and when on the Cr. side of this account ? How is the Cash Account closed ? How are Merchandise and other siiiiilar accounts kept and closed? Define Bills Receivable. Of what may Bills Receivable consist ? What is the object in keeping this account? With what is it debited and credited? Define Bills Payable. Of what may Bills Payable consist ? What is the object in keeping this account ? How lis it conducted and closed in the Ledger? Explain the method of keeping a bank account. For what purpose are accounts of Expense, Insurance, Charges, Interest land Discount kept? How are they closed? Describe the object and manner of ikeeping Personal Accounts. What does the Dr. side of a Personal Account show? Iwhat the Cr. side? Define "Stock" as a Ledger title. How is the Stock Account Iconducted and closed ? i c: 5oo o 800 875 CHAPTER IL DOUBLE ENTRY. We introduce the learner, at once, to Double Entry Book-keeping, omitting any [special instructions in Single Entry until the student has become familiar with the Principles of the former system ; for the reasons, first, that we do not desire to distract |the mind from the more important considerations bearing upon the science of accounts ; and, secondly, because a student who has mastered Double Entry, requires [lothing more than a perusal of Single Entry to understand it. In Double Entry Book-keeping accounts are kept not only with individuals, but also with all resources and liabilities, and with the different branches of gains and fosses, 24 Business transactions consist chiefly in exchanging various forms of value. Among these are Merchandise, Real Estate, Cash, Personal Debts, Written Obligations, Service, etc. In many kinds of business it is necessary that the amounts of these different forms of value in possession, as they exist at any one time, may be readily and easily ascertained ; also how much is due to others, and how much has been paid out or received for any i)articular purpose. This information is required in order to know the exact condition of affairs, and to have a correct basis upon which to plan any future enterprise. To obtain the information fully, an account must be kejit, not only with the persons with whom business is transacted, but also with every form of value exchanged, and with every source of receijit and expenditure. The distinguishing feature in Double Entry consists in carrying out a mathematical principle of equilibrium, under the titles of debtor and creditor. The variations introduced in the manner of working the following sets are merely peculiarities. The particular method or form in which books are kept is not essential, as long as they conform to the principle of equal debit and credit. The forms in use in business houses vary according to the nature and extent of the business. In a small retail store a record showing the amounts which are due from persons who have purchased from us on credit, and due to persons from whom we have purchased on credit, is by many considered sufficient. In some cases an authentic record that can be used as evidence is all that is wanted ; in others the workings of each series of operations, the results of each series of income or loss, and the comparative value of different undertakings must be fully set forth as a basis for future plans, and to determine what is requisite for the safe and successful conduct of affairs. A system of checks against omissions, mistakes and frauds is also in many establishments indispensable in order to guard against errors and serious losses. Without an accurate set of books, proceedings must be upon vague and possibly erroneous conclusions, the results of which may be insolvency and bankruptcy. The qualifications necessary to keep books properly will, therefore, depend very much upon the kind of business for which the books are required. In any business a knowledge of certam principles is indispensable ; and a comprehensive acquaintance] with the science of accounts will give many facilities and advantages not possessed by those who have no knowledge except what they have gained from a contracted routine| of petty details. The principal books used are the Day Book, Journal and Ledger. The Auxiliary! Books vary according to the nature of the business, and are the Cash Book, Bill| Book, Invoice Book, Sales Book, Letter Book, Receipt Book, Account Salesj Book, etc. The form and number of the auxiliary books used depend in all cases upon thel nature of the business transactions ; but as a knowledge of the auxiliaries is easilyl obtained, it is not thought best to encumber the mind of the student with them atj first, and they are accordingly omitted until a subsequent part of the work. DIRECTIONS FOR JOURNALIZING. Journalizing is ascertaining the proper debits and credits of business transactions! recorded in the Day Book, and writing them in the Journal. This requires thoughtl and study. Whenever a transaction occurs, the book-keeper should reflect for a| moment, and see what part of the property is affected by that transaction, and thenl the accounts that represent that property, are the accounts to be made Dr. a»d Cr\ Every Dr. viiist have a corresponding Cr. of equal amount, and every Cr. must have ii| correspondi your prope and the oi account rej or, if you b you sell tha is sold on < us. Those For ex dise would you pay hin Or if you s Merchandisi be Dr. ; or to A. Browr Cr. by A. B Dr. to Cash account, Bil Bills Receivi Receivable, ; Journal! be found difil Rule f " Credit 7vha The abo thorough unc moments as y The for.' accounts to b follow ; so w Merchandise I— Bought of amonntin 2-SoId VV. B. 3-raid S. G. 4— Received fr account, S-Sold Geo. t- indse., ^2 6— Bought of S ^8oo, 7— George She §2oo. S— I'aid my $8oo. 9— I^eceived fn balance h 10— Bought of I in paymen for the bal n-SoId R. Gori payment \ the balanc r 25 corresponding Dr. of equal amount. If the transaction takes from the one part of your property and adds to another, the account from which it is taken is made Cr. and the one to which it is added is made Dr. Whenever you buy property, the account representing that property is made Dr. to what you give in payment for it ; or, if you buy it on trust, it is made Dr. to the person that trusted you ; and when you sell that property it is made Cr. by what you receive in payment for it ; or, if it is sold on credit it is Cr. by the person trusted. Those persons are Debtors who owe us. Those persons are Creditors whom we owe. For example, if you buy merchandise of A. Brown on account, $500, Merchan- dise would be Dr. to A. Brown $500, and A. Brown Cr. by Merchandise, $500. If you pay him cash for it, Cash would be Cr.; if your note, Bills Payable would be Cr. Or if you sell merchandise on account to J. Meudell, he would be made Dr. to Merchandise, and Merchandise Cr. by J. Meudell. If he paid you cash. Cash would be Dr. ; or gave you his note, Bills Receivable would be Dr. If you gave your note to A. Brown on account, he would be made Dr. to Bills Payable, and Bills Payable Cr. by A. Brown. When you redeem that note with cash, Bills Payable would be Dr. to Cash, and Cash Cr. by Bills Pavuble. If J. Meudell gives you his note on account, Bills Receivable would be made Dr. to J. Meudell, and J. Meudell Cr. by Bills Receivable. When he redeems that note with cash. Cash would be Dr. to Bills Receivable, and Bills Receivable Cr. by Cash. Journalizing is considered the most scientific part of book-keeping, but will not be found difficult if you understand the following : Rule for Journalizing. — " Delnt zvhat costs value, or the thing received.'^ " Credit what produces value, or the thing parted zviih." The above rule is the Key to the principle of Double Entry Book-keeping, and a thorough understanding of it at the commencement will save time, and many vexatious moments as you become further advanced. c 1 EXERCLSES IN JOURNALIZING. The form of making a Journal entry is to place the name of the account or accounts to be dobxitd first, then the name of the account or accounts to be credited follow ; so when you write : Bills Receivable Dr. to Merchandise, it implies that Merchandise account is to be credited as well as Bills Receivable to be debited. Transactions. I— Bought of S. G. Realty, on account, mdse., amounting to §4,500. 2— Sold VV. B. Robinson, on acct., mdse., $750. 3— Paid S. G. Beatty, cash on account, 8400. 4— Received from W. B. Robinson, cash on account, $500. S— Sold Geo. Sherry, on his note at one month, mdse., §200. 6 — Bought of S. G. Beatty, on my note, mdse., $800. 7— George Sherry has paid his note in cash, $200. 8— Paid my note to S. G. Beatty in cash, $800. 9— Received from W. B. Robinson, cash to balance his acct., $250. 1 10— Bought of F. Rous, mdse., §2,000. Gave inpayment my note for §1,000, and cash for the balance, §1,000. |ii— Sold R. Gordon, mdse., §800. Received in payment his note for §500, and cash for the balance, §300. Journalized. I- -.Mdse. Dr. §4.500 To S. G. Beatty, §4.500 2- -VV. B. Robinson, Dr. 750 To Mdse., 750 3- -S. G. Beatty, Dr. 400 To Cash, 400 4- -Cash Dr. Soo To W. B. Robinson, 500 5- -Bills Receivable, Dr. 200 To Mdse., 300 6- -Mdse. Dr. 803 To Bills Payable, 800 7- -Cash Dr. 200 To Bills Receivable, 200 8- -Bills Payable Dr. Soo To Cash, 800 9- -Cash Dr. 250 To W. B. Robinson, 250 10- -Mdse. Dr. 2,000 To Bills P.iyable, 1,000 To Cash, 1,000 II- -Bills Receivable Dr. 500 Cash Dr., 300 To Mdse., 8co 26 RECORD OF TRANSACTIONS. A Business Transaction consists nominally in an exchange of values ; and each complete record of a transaction is based upon the theory that something is received and something given. This theory, however, is not always literally, though it may be constructively, true One unvarying condition of a transaction is that its complete record requires at least two entries — one to the Debit of some account, and one to the Credit of some other account. Frequently, however, the record may involve more than two accounts; but under any circumstances, the sum of the debit and credit entries must be equal. Preserving the equality of debits and credits, the records of a transaction may require any of the four following forms : 1. One Debit and one Credit. 2. One Debit and two or more Credits. 3. Two OR more Debits and one Credit. 4. Two or more Debits and two or more Credits. The main object of a business record is to show at any time the condition of the business ; in other words, what the concern is ivorth. Inasmuch, then, as the real or net worth of a concern is the difference between its property and debts, it follows that any adequate system of business record must secure the ready means of ascertaining these necessary items. The following Set is worked out in full, in order to show the pupil the proper form of carrying the transactions through the different books, and should be thoroughly understood in every particular before proceeding further • The transactions are first taken from the " Record," which is supposed to be a memorandum of the merchant's business transactions in the date and order of their occurrence, and arranged properly in the Day Book, after which they are journalized and posted. A faithful adherence to the foregoing instructions and applications will enable the pupil to record, readily and correctly, the excercise on page 27, which should be first written on skeleton paper prepared for that purpose, or on blank paper ruled u]) by the student himself. • ACCOUNTS TO BE OPENED IN LEDGER WITH number of lines REQUIRED FOR EACH. For the benefit of the student, and in behalf of economy in the use of Ledger paper ^ we give below the number of lines required for each account in the nine follozving Sets : Tills apportionment, it will be borne in mind, provides for the Ledger Headings and also for the necessary space to close up the accounts in due form. Set I. — Stock 6, Cash 14, Flour 9, Wheat 14, Bills Payable 10, Bills Receivable 8, James Rimmer 9, W. Lingham 6, Robert Thompson 7, H. Corby 7, James Miller 5, Expense 6, Loss and Gain 9, Balance 12. Set II. — Stock 9, Cash 18, Merchandise 20, W. L. Hamilton 10, Sanderson & Co. 9, A. H. Skinner 9, B. M. Carman 10, R. S. Thompsons, Expense 12, Loss and Gain 10, Balance 13. SetHI— Stock 9, Cash 17, Merchandise 16, Bills Payable 10, Bills Receivable 11, Muir & Co. 9, Geo. Sherry 9, S. G. Beatty 9, H. Warren 8, Thomas Moore 10, Expense 12, Loss ami Gain 10, Balance 12. Set IV.— Stock 9, Cash 15, Merchandise 15, Bills Receivable 11, Bills Payable 11, G. S. Tickcll 8, Takes &; Hayes 9, G. W. MayL)ee 8, IL Corby 8, Expense 11, Interests, Loss and Gain II, Balance 10. Set v.— S ( t ( Sets VI at ac tui C( 14 Cc N( Lc Skt VIII ( F. Go Me Int In ma putting the each item. It is e; with this S( f / and hing is ough it lires at )f some xounts ; 5 equal, on may 27 Set V. —Stock 8, Cash 25, Bills Receivable 10, Bills Payable 9, Merchandise 23, J. W. Campion 9. L. W. Yeomans 9, Ames, Holden & Co. 10, F. M. Clarke 8, W. T. Tilley 8, Shipment to Tilley 8, Interest & Discount 10, Expense 12, Ont. Trans. Co. Shares 5, Loss and Gain 10, Balance 13. Sets VI and VII (under same headings)— Student (Capital account) 13, James Fenwick (Capital account) 10 ; Cash, 27 ; Merchandise, 18 ; Bills Receivable, 13 ; Bill Payable, 13 ; Furni- ture, 9 ; Expense, 11 ; Rent, 12; Insurance, 12; Montreal Bank, 26; Jones & Co.'s Consig't. No. I, 10; W. B. Robinson, 10; Jones & Co.'s Consig't. No. 2, 10; Charges, 14 ; Commission, 14 ; Jones & Co., 14 ; W. West's Consig't, No. i, 9 ; Jones & Co's Consig't. No. 3, 9 ; H. "Holden. 8 ; W. West's Consig't. No. 2, 9 ; Jones & Co.'s Consig't. No. 4, 9 ; Interest and Discount, 10 ; W. West, 9 ; Solomon Johns, 8 ; Good Will, 8 ; Loss and Gain, 18 ; Balance, 11. Skt VIII (Single Entry) and Set IX, under same headings— J. S. Miller (Capital account) 9 ; F. Lane (Capital account) 9 ; J. R. Marvin, 8 ; W. McKay, 12 ; Robert Carey, 13 ; James Goodwin, 13 ; H. Simmons, 13. Additional accounts after openining Set IX : Cash, 9 ; Merchandise, 13; Bills Receivable, 12; Bills Payable, 9; Real Estate, 8; Expense, 9. Interest and Discount, 8 ; Shipment to B. Way, 9 ; Loss and Gain. 9 ; Balance, 11. Set I. ion of the 1, as the it follows means of he proper hould be to be a of their )urnaUzed rill enable should be ruled up 'ger paper, ng Sets : Headings PRODUCE BUSINESS. In making the entries in the Day Book leave a line between all transactions, putting the date on the line ; and in making an entry of several items take a line for each item. It is expected that the student will not merely copy the exercises in connection with this Set, but that he will work them out for himself according to the forms given. RECORD OF TRANSACTIONS. Quebec January i, 1894. Commenced business, investing as follows. Cash : $4,coo 50 500 bbls. Extra Flour, at $6.00 3,000 00 »oo bush. Fall Wheat, at $1.25 1,000 00 I Jan. 2 — Bought of W. Lingham, for Cash, 50 bbls. Superfine Flour, at $6.00 300 00 " Sold James Rimmer, on acc't., 100 bush. Fall Wheat, at $1.50 150 00 '■ Bought of H. Corby, on my Note, 200 bush. Spring Wheat at $1.00 200 00 3— Sold Robert Thompson, on acc't., 400 bush. Fall Wheat, at $1.50 600 00 " Bought of W. Lingham, on my Note, 100 bbls. Superfine Flour, at $6.50 650 00 " Bought of James Wilson, for Cash, 200 bush. Fall Wheat, at $1.50 300 00 4— Sold John Smith, for his Note, loo hush. Fall Wheat, at $1.75 175 00 " Received of James Rimmer, on acc't.. Cash .' 100 00 5— Bought for Cash, 400 bush. Fall Wheat, at $1.40 . 560 00 " Sold James Johnson, for Note, loo bush. Spring Wheat, at $1 20 120 00 6 — Bought of H. Corby, on account, 500 bbls. Extra Flour, at $6.00 3,000 00 " Sold James Miller, on account, 200 bbls. Extra Flour, at $6.50 1.300 00 " Sold for Cash. 100 bush. Spring Wheat, at $1.25 125 00 8 —Sold James Rimmer, on account, 200 bush. Fall Wheat, at $1.40 280 00 Received of James Miller, his Note in full of acc't i>30o 00 25 50 375 00 450 00 1,000 00 380 00 315 CO 650 00 nes Rimmer 6, Loss and , H. Skinner nee 13. kir & Co. 9. [2, Loss anil . S. Tickcll fs, Loss and 9 — Paid Cash for Sundry items of expense. " Sold Robert Thompson, on acc't 250 bush. Fall Wheat, at $1.50 10— Bought of W. Lingham on acc't., 450 bush. Spring Wheat, at $1.00 . " Paid H. Corby, on acc't 1 1— Sold Robert Brown, 380 bush. Spring Wheat, at $1.00 " Received in payment his Note for $150, Cash for bal. $230 12— Bought of W. Lingham, on my Note, 50 bbls Extra Flour, at $6.30 Paid Cash for my Note of the 3rd inst., favor of W. Lingham. 13— Sold J. Rimmer, on acc't, 200 bbls. Extra Flour, at $7.00. . . 1,400 00 15 — I'aid Cash in full for my Note, favor H. Corby •' Received of R. Thompson, Cash in full acc't " Received Cash in full for J. Smith's Note of the 4th inst. 16 — Gave H. Corby my Note on acc't 17— Bought of W. Lingham, on acc't., 550 bush. Spring Wheat, at $1.00. .... 200 00 975 00 175 00 1,000 00 . _ 553 00 Sold J, Rimmer, on acc't.^^ 150 bbls. Superfine Flour, at $8.00 1,200 00 I 2n 00 140 00 " Received Cash, in full for J. Johnson's Note of the 5ih inst . 18 — Paid rent and sundry expenses in Cash .... " Goods unsold as per Inventory, Flour $3,915. Wheat $1,120 Caution. — In transcribing a set to your Day Book leave the column blank for your own folios. leadings for the first nine sets will be found on pages 26 and 27. c r iKTThe Ledger 28 SPECIMEN DAY BOOK. TO THE STUDENT. After becoming familiar with the preceding instructions and tracing through the examples on journalizing given on page 25, you may write up the Day Book according to the following form, then lay aside the printed book, and on a sheet of waste paper journalize the entries of the Day Book ; after which compare with the printed journal to see if you have journalized correctly ; then post to the Ledger, as directed in explanations on posting, independent of the printed book, and make out your Trial Balance and statements. Quebec, January i, 1894 SO o[i. 30 30 30 30 .3° 30 30 30 30 30 30 30 30 * this day commences the Produce Business, renting a store from V. Johnson, .ind investing as follows : — Cash, 500 bbls. Extra Flour, 800 bush. Fall Wheat, Bought of W. Lingham for Cash, 50 bbls. .Super. P'lour, Sold J. Kimmer on account, 100 bush. Fall Wheat, Bought of H. (^orby on my Note, 200. bush. Spring Wheat, 3 Sold Robert Thompson on account, 400 bush. Fall Wheat, Bought of W. Lingham on my Note, 100 bbls. Super. Flour, Bought of James Wilson for Cash, 200 bush. Fall Wheal, 4 Sold John Smith for his Note, 100 bush. Fall Wheat, Received of J. Rimmer on account. Cash, 5 Bought for Cash, 400 bush. Fall Wheat, Sold James Johnson for his Note, 100 bush. Spring Wheat, 6 Bought of H. Corby on account, 500 bbls. Extra Flour. Sold James Miller on account, 200 bbls. Extra Flour, Amt. carried forward. siness, g as 6.CK3 1.25 4000 3000 1000 50 00 00 •fSooo 6 00 300 1.50 ISO 1. 00 200 1.50 600 6.50 650 1.50 300 «-75 «7S ICO 1.40 560 1.20 120 6.00 3000 6.50 1300 '5455 SO CXJ CX5 00 00 00 00 00 00 00 00 GO 00 SO * Student to use his own n.ime. Note. — The figures in the narrow column to the left refer to the pages of the J[ournal upon which the transactions have been journalized, and should be placed in the Day I'ook, opposite the transactions, immediately after the Journal entry is made. This is called folioing, and serves the purpose of reference from one book to another, as well as a check I indicating that the entry has been transferred. | If goods have been charged in Day Dook, and the customer pay for them before the entry has been posted, just maik| I'Aii) in the margin in a bold hand, and put the money in the till, to be counted with that day's Cash Sales. * The value of 'III-- cost standard is I I'lncluising market, , At the end ofe Slock IJook," the See Inventory or S 29 Quebec, January 6th, 18^4. ugh the :cording te paper I journal ected in 3ur Trial I, 1894 8000 5° 300 00 150 00 200 00 600 00 650 00 300 00 175 00 ICO 00 560 00 120 3000 00 00 1300 00 1 5455 50 he transactions I fter the Jouniall well as a checl; I sted, just maik I 30 30 30 30 31 31 31 31 31 31 31 3> 31 31 31 ji 3« 31 Sold for Cash, loo bush, Spring Wheat, 8 Amount brought forward, Sold J. Kimmer on account, 200 bush. Fall Wheat, Received of James Miller his note in full of account, 9 Paid Cash for Sundry Expenses, Sold K. Thompson on account, 250 bush. Fall Wheat, 10 bought of W. Lingham on account, 450 bush. Spring Wheat, Paid H. Corby Cash on account, II Sold Robert Hrown, 380 bush. Spring Wheat, Received in payment his Note, Cash for the Balance, 12 Bought of W. Lingham on my Note, 50 bbls. Extra Flour, Paid Cash for my Note of the 3rd inst.. 13 Sold J. Rimmer on account, 200 bbls. Extra Flour. "5 Paid Cash in full for my Note, favor 11. Curl)y, Received of R. Thompson, Cash in full of account, Received Cash in full for John Smith's Note of the 4th instant, 16 Gave H. Corby my Note on account, 17 Bought of W. Lingham on account, 550 bush. Spring Wheat, Sold J. Rimmer on account, 150 bbls. Super. Flour, Received Cash in full for J. Johnson's note of the 5ih inst., 18 i'aid Cash for rent and Sundry Expenses, 'Inventory of Goods unsold : Flour, Wheat, Total, 3915 1120 5035 •5455 1. 25 '25 1.40 280 1300 25 1,50 375 1. 00 1 450 1000 1. 00 ISO 230 00 00 380 6.30 3'S 650 7.0G 1400 200 975 175 1000 I.QO 550 8. GO 1200 120 140 26116 1 50 00 00 (16 50 00 00 00 00 CO f 00 00 00 00 00 CO 00 00 00 00 00 * The value of unsold propiirty is not iiecussririly measured by its cost nor its selling price, althoug' in ordinary cases the cost standard is adopted in taking " inventory of stock." The proper stancl;ird of value is the cost of goods in the purchasing market, or what it would cost to replenish them, I .\t the end of each set the value of goods left unsold is given. In business an inventory of stock is written into the I "Slock Book," the amounts and quantities are e.vtended, then added, and the tQtal value of the goods on hand is shown. I See Inventory or Stock Book. c: 30 SPECIMEN JOURNAL. Some business men require their Journal to embody brief explanations of their transactions ; but we do not introduce this plan now, because, at the beginning everything that takes the learner's attention off the LEDGER TITLES has a tendency to perplex and embarrass him. Familiarity with the following form will prepare the student for using any other without difficulty. Quebec, January ist, 18^4. 22 34 34 34 34 34 34 35 34 34 34 35 34 34 34 34 34 35 34 34 35 34 34 35 34 34 35 35 34 34 34 35 34 35 35 35 34 Cash Dr. Flour «' Wheat •• Flour Dr. J. Kimmer Dr. Wheat Dr. R. Thompson Dr. Flour Dr. Wheat Dr. Bills receivable Dr. Cash Dr. Wheat Ur. Bills Receivable Dr. Flour Dr. James Miller Dr. Cash Dr. J. Kimmer Dr. Bills Receivable Dr. Expense Dr. To Stock, To Cash, To Wheat. To Cash, Amts. carried forward, 3 To Bills Payable, ti To Wheat. i< To Bills Payable, 4 To Cash, i( To Wheat, e To James Rimmer, (< To Cash, 6 To Wheat, (1 To H. Corby, ,. To Flour, 8 To Wheat, *• To Wheat, 9 To James Miller, 28 28 28 28 28 28 28 28 28 28 28 28 28 •29 29 29 29 4,oou 3,000 1,000 300 150 200 600 650 300 >7S 100 560 120 3,000 1,300 1 25 280 1,300 25 50 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 CXJ 00 50 17,186 00 8.000 300 «5o 200 600 650 300 175 100 560 120 3,000 1,300 125 280 50 00 00 00 00 00 00 00 00 00 00 00 00 25 17,186 CO ■ Specimen ok GO CO 50 00 Note. — The figures in the narrow cohimns are the pages of the Day-Hook and Ledger ; those to the left are LeilRti folios, and those to the right Day-Book folios. By the latter we are able to refer readily to the book of original entn| and by the former to the Ledger account. 31 ions ; but : learner's ''amiliarity 1894. 8.000 50 300 150 00 00 200 600 650 300 175 100 560 120 00 00 00 00 00 00 GO 00 3,000 1,300 125 280 00 00 CO 00 '=J'^ 00 25 50 17,186 00 35 34 34 35 35 34 35 34 34 34 35 34 34 35 34 34 34 34 35 34 35 35 34 34 35 35 34 34 35 35 34 Quebec, January Qth, 18^4. Amts. brought forward, K. Thompson Dr. To Wheat, 10 Wheat Di. H. Corby Dr. Bill Kec. Dr. Cash Flour Dr. bills Payable Dr. J. Kimmer Dr. Bills Payable Dr. Cash Dr. Cash Dr. H. Corby Dr. Wheat Dr. I. Kimmer Dr. • Cash l^r. Expense Dr. To W. Lingham, 11 II To Cash, 12 To Wheat, l( To Bills Payable, 13 To Cash, '5 To Flour, << To Cash, ti To R. Thompson, 16 To Bills Receivable. 17 To Bills Payable. (1 To W. Lingham, »t To Flour, 18 To Bills Receivable, To Cash, 17,186 00 17,186 29 375 00 375 29 450 00 450 1 1,000 00 29 1,000 29 '50 230 00 00 380 29 i 3'5 00 315 29 i 650 00 650 29 '■ 1,400 00 1,400 200 00 29 200 29 975 00 975 29 175 00 175 1.000 00 29 1,000 29 550 00 550 1,200 00 29 1.200 i 120 00 29 120 29 140 00 140 26,116 00 26.116 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 Stecimen ok Day Book and Journal on same, or opposite pa^es of one. Book, having Day Book and Journal entries ditcctly opposite each other. I left are LeilRe| )f original eiiinl DAY BOOK. 1st ^o 30 30 B'ht. of W. Lingham tor cash 50 bbls. Flour $6 00 2nd Sold J. Kimmer on acct. 100 bush. Wheat r- 50 B'ht. ut H. Corby on my Note 200 bush. Spring Wheit $1 co 34 300 00 34 35 '50 00 34 34 200 00 34 JOURXAL. 1st Flour Dr. To Ca!?h, 2nd J. Rimmer. Dr. To Wheal Wheat Dr. To Bills Pay, 300 00 300 00 150 00 150 00 200 00 200 00 c 32 LEDGER. You have now finished the most difficult part of your task, the problem being solved ; for each Debit you have found a corresponding Credit. This, in the main, is the science of Double Entry Book-keeping, the remaining part being considered as a mechanical operation. The Journal items having been prepared, you will now carry them to the Ledger or post them. Posting : — Each different account found in the Journal must have a place in the Ledger, and the carrying to that account from the Journal all for which it is Debited or Credited, is called posting. The Ledger usually opened by placing Stock,* or the partners' names, at the beginning, in a clear text hand, followed by the most prominent accounts, such as Cash, Merchandise, Bills Payable, Bills Receivable, etc., as shown in Model Ledger. Insert the abbreviations Dr. and Cr. at the top of the page only. In expressing the entry upon the Ledger it will be seen that a debit is always " To " that account which receives credit for the sum, and the Cr. account expresses the same entry " By " the account that was made Dr. for the same sum. Now, under each account you place all the entries that belong to it, found in the Journal, transferring the entries from the Journal to the Ledger in the order in which they occur. You first turn to Cash Account, and on the Dr. side p^ace the words ** To Stock." | This signifies that Cash or the Cash Account owes Stock for the amount of invest- ment. In the first ruled column, called the folio column, you place the page of the I Journal and in the next columns the amount. You next turn to the Cr. side of the *Stock Account, and place the words •' By Cash," signifying that Stock is credited by Cash, and carry the Journal page, or folio, to first column and the amount to next columns, and thus proceed, carrying all the Journal entries to their respective places in the Ledger. Then you will find in the Ledger, as in the Journal, for each debit | there is a corresponding credit. The learner will acquire the process of posting more readily by seeing it done! on printed Ledger than by any other means. INDEX TO THE LEDGER. This is a small book, or space ruled in the account book, in which are! arranged, in alphabetical order, the names of all accounts in the Ledger, together wilh| the pages on which accounts are entered. The object of keeping it is to enable us to refer readily to the accounts in the! Ledger. Whenever we open an account in the Ledger we enter the name of thel account and the number of the page in the Index. If an account should be transl ferred to another page, a red line should be ruled through the figures of the old page,] and the number of the new page placed in the Index. In real business the Index generally has a page allotted to each letter. The| following illustrations will be sufficient to explain how it is kept : *The Stock acct. is almost universally used by Accountants intead of the proprietor's name ; but it is rather an ilil chosen title, as young Book-keepers are apt to confound it with the Merchandise Acct. The term Capitai, or si)iiu| other title that would better express the nature of the Account, would be more appropriate. We will not, howewr conflict with established usages by changing the title of this account. tThere being three accounts representing Stock's investment, it is usual to credit, in that case, Stock By Sundries- See Ledger. Cautio this precauti individual ; mistakes. When : another pag( the totals to " Carried to from Folio- new page. 33 INDEX is rather an ili Al'lTAl. or somii il not, howcvttf A Pace 35 34 34 35 35 34 K 1 Pack li Kills Receivable, Kills Payable. Ualance, L Lingliiim, W. . Loss and Gain, 35 C Cash, Corby. M. M D • N E Expense. F Flour, 1' G <.> H K Rimmer, James, 35 I S T Stock, 34 J U VW Wheat, 34 Caution. — Always index an account when opening it in the Ledger. Without this precaution it may be forgotten, and a second account opened with the same individual ; and, unimportant as this may appear, it often leads to very troublesome mistakes. When it is necessary, owing to the leaf being filled, to transfer an account to another page of the Ledger, don't balance the account, but add each side and carry the totals to the new page. Write on the last line, on each side of the old page, "Carried to Folio — ," and on the first line of each bide of the new page, " Hrouglu from Folio — ," and put the new page in the Index. Also date the transfer in the new page. . C r 1 31 SPECIMEN LEDGER. |)|{ /Kxistini; Dclils at slnrtinn. Aiiii)imts\ STC^CK. \ wllliilrawii ami net li)!>s, if any. / l«94 (Investments and nct\ K'ain, ifany. / 7894 Jan. liy Sundries, 30 Cr. 8,000 50 1894 |an. 2. *t 8 II M «i «7 ( Kcccived. j CASH. / Paid out. ) Jan. 1 To Stock, ,10 4,000 50 Jnn 2 Ry Flour. .30 3or 00 4 " J. Kimmer, ,S0 100 00 3 •' Wheat, 30 3CX3 00 6 '* Wheat, 30 125 00 S t* »• 30 560 00 II ti It 3> 2^0 00 9 " Expense, 30 25 50 IS " K. Thompson, 31 97S| 00 10 " H. Corby, 31 1,000 00 '.S " Bills Kec, 31 175, 00 12 '• Hills Pay., 31 650 00 17 «( 41 SI 120, 00 IS II II 31 200 00 j 1 18 " Expense, 31 140 00 ( Cost. ) '■■■ FLOUR. I Proceeds. I Inn. I To Stock, 2 " Cash, 3 •• Bills I'ay., 6 " H. Corby. 12 " Bills ray.. 30 1 • 3.000 00 Jan, 6 30 300 00 t k 13 30 650 00 k* 17 30 3,TOO 00 31 315 00 By J. Miller, *' J. Kimmer, 30 1,300 31 1,40c 31 1,200 00 OT) 00 4' ( Cost. ) * WHEAT. I Proceeds. I Jan. 1 To Stock. 30 1,000 2 •' Bills I'ay., 30 200 3 " Cash 30 300 5 4« 41 30 560 10 " W, Lini;ham, 3« 450 17 14 tl 31 550 — 00 Jan. 2 By 00 3 00 4 00 5 00 6 00 8 9 11 By J. Kimmer, R. Thompson, Bills Kec, 41 Cash, J. Kimmer, K. Thompson, Sundries, 30 30 600 30 I7S 30 120 30 30 '25 280 31 31 375 380 /My iMy Notes\ eemed. / BILLS PAYABLE. / My Notes\ \ issued. / 12 •5 To Cash, 31 650 00 Jan. 2 31 200 1 00 II ti II 3 12 16 By Wheat. ** Flour, •' II. Corl.y, 30 200 30 650 31 315 31 1,000 /Others' N()tes\ ^ received. / BH.LS RECEIVABLE. (Others' Notes disposed \ of, or collected. / 00 00 CO 00 00 00 00 00 00 00 00 00 Ian. 4 To Wheat. 30 175 00 Jan. 15 By Cash, 3« 175 00 »• 5 t » > 1 30 120 00 17 • t 44 31 1 20 00 • 4 8 •' I. Miller, 30 1.300 00 (4 II " Wheat, 31 '50 00 Jan. 9 T 11 18 Posting to th aru shortened as i of Day Book, or $3S'Oo the total o To the .Student : Observe the analyses of the accounts and study them thoroughly. Read in connection with tin; from page 18 to 22. * The analysis of Flour and Wheat is the same as Merchandise. ;]-) Ck. 8,000 50 300 00 300 00 560 00 25 50 1,000 00 650 00 200 00 140 00 i,3cx) 1,200 00 ori 00 150 00 600 00 175 CO 120 00 125 00 280 00 375 00 380 00 200 00 650 00 3>5 00 1 1,000 00 =d, posed \ 175 120 (X) 00 Jan. Jan. Jan. Jan. / My.Uxt, \ \aKaiiist him./ JAMES RIMMER. / Mi- A.i t. \ VnKiiiiHt me./ 1894 |an. 2 1. 8 II «3 i< «7 To WhMt, Flonr, 1894 30 150 280 00 Jan. 4 .10 00 «■ 31 1400 00 3« 1200 00 By Cnsh, 30 too 00 VV. LINGHAM. / Mis .Vet. \ ',a|>>iii>st mv./ Jan. 10 >7 By Wheat, / My .Vet. \ V'igaiii.st him. j ROBERT THOMPSON. 3« 3« / Mis .\ci:t. \ l>;ig:uiist me.^ 450 550 00 00 To Wheat, / My Acct. N \ag.tmst him./ 30 31 600 375 00 00 Jan. 1 >5 By Cash, H. CORBY. 3> / Mis Acct. N \ against me./ 975 00 c r • 10 16 To Cash, " Bills Pay., ( My Acct. "j ^.igamst him./ 31 3i 1000 1000 00 00 Jan. 6 By Flour, 30 3C'X) 00 JAMES MILLER. ( Mis .Acct. 1 ^against mc./ To Flour. /Outlay foA I Expenses,/ 30 1300 00 Jan. 8 1 By Bills Kec,' 30 1300 00 EXPENSE. 9 18 To Cash, 30 25 140 1 50 00 *The plan is frequently adopted of ruling a special column on the Cr. side of personal .iccounts, to show the due date of customers' notes. It may also, ofcour.se, he done on the Dr. side to show the due dates of your own notes. Posting to the Ledger is often .ihbreviated. Inste.id of taking a line for each of the items debited or credited, they are shortened as in the following account. The lower figures are amounts of debits or credits, and the upper figures folios of Day Book, or Journal, or .Sales liook, or Cash Book, .xs the case may be. $98.70 is the total of the debits for June ; $35.00 the total of the credits for July, Dr. JOHN JONES. Cu. 1894 June 29 .31 43 To $57.80, 36 90, 4,00 98 70 1894 July 83 91 By .§1000 25.00 35 00 ction with thcstl 36 TEST OF THE LEDGER. The first thing to be done after the transartions of a set have been i)ostcci is to test the correctness of your work, by comparing tlie amounts of thi: two sides of the Ledger, and seeing that the sum of the Dr. side of all Ledger accounts equals the sum of the Cr. side. This is accomplished by making out a TRIAL DAf.ANCK. A Trial balance is taken to ascertain if the Debits and Credits on the Ledger are equal or balance. As soon as you finish posting all the transactions to the Ledger, according to the principal of ecjual debits and credits, you take off a Trial lialance. This is done by first footing the items of the different accounts, placing the amounts in light pencil marks, which should be erased after the completion of the work. The totals of the accounts are carried to the Trial Halance, as i)er model form, leaving out such accounts as close themselves. Hy adding to the footings of the Trial Balance given, the footings f.f accounts that close themselves, you will find that they exactly correspond wiin those of the Journal, which would not be the case if any of the Journal entries were not posted ; and as the footings of the Journal columns also tally with those of the Day Book, it is almost conclusive that all the original entries have found their way to the Leduer. There will remain but two chances of errors in the accounts, viz., from improper Journal entries, or from posting to the wrong accounts in the Ledger. It will be obseived from the foregoing remarks that the Trial Balance is not always a strict proof of the correctness ot the work, though it is .so nearly a test that, under ordinary circumstances, it may be considered satisfactory. A Trial Balance may be taken with the difference columns only (see the municipal set), or with the amount columns only. The former is very frKjuently used in business. In a real business, a Trial Balance may be taken monthly (see form of monthly Trial Balance), and should be taken as often as once in threi: months, even thouqh the books are closed but once a year. Never attempt to close a Ledger that is out of balance. The error, or errors, will be found somewhere by careful, patient checking. When a book-keeper first takes charge of a set of books that have previously been kept by another, he should take off a Trial Balance to prove if the Ledger is in balance. If not in balance he should find the errors before making any entries in it. TRIAL BALANCE— Set I. Dr. Hal. Dr. Footings. L. F. 34 2550 00 5725 5" 34 3365 00 7265 00 34 «S5 00 3060 00 34 850 00 34 •450 00 •745 00 34 2930 00 3030 03 35 35 2000 00 35 165 50 5° 16S 50 00 35 "1315 23841 ACCOUNTS. Stock Cash Flour Wheat Bills Payable.. . Hills Receivable James Rimmet . . W. Linghani . . H. Corby Expense Cr. Footings. 8000 3«75 3900 2205 2165 295 ICO 1000 3000 50 50 00 00 CO 00 00 00 00 23841 00 11315 Cr. Hal. 8000 UiS 1000 1000 00 00 00 ■lo Note. — The Ledger from which the foregoing Trial llalance was taken does not contain all the results of ilicl Imsiness. Hence, in getting at the data from which to ascertain the net worth or the net gain or loss, it will bcl necessary to go heyond the Ledger, and estimate the value of the unsold merchandise or other similar property. In each of the statements which follows, an Inventory of unsold property is supposed to have heen taken, the resiili heing given. (fo Flour, t. unsold Cr. or (1 Total 1 Dr. or focecds from sales of |)roperty having a variable value, it follows that the real value of such property remaining on hand can be ascertained only by actual enumeration and valuation, a process known in business .ns " taking account of stock," or " taking an inventory." 'i'he value of property which does not vary, viz., Cash, Notes and Personal indebtedness, is readily ascer- tained from the accounts themselves. In classifying accounts or specific results, two grand objects are kept in view, which are : ist. The net gain or loss during a sjjecified time ; and, 2nd, 'J'he net I worth or insolvency of the business. The processes of arriving at these results are distinctly indicated above. The c/(;?.f.v//f atlai i I this, study carefully the e.iplan.itioiis on page 39, and also the suhjects on pajje \n. L— STATEMENT OF LOSSEIS AND GAINS. (for THK I'URl'OSE OF ASCERTAINING THE NET GAIN OR LOSS.) 1 4 Flour, unsold per Inventory '. 3915 '• Cr. or proceeds from sales 3900 " Total proceeds 7815 '• Dr. or cost 7265 " Difference or gain Wheat, unsold per Inventory 1 120 " Cr. or proceeds from sales 2205 " Total proceeds. '* Dr. or cost 3060 " Difference or |;ain Expense, Dr. or outlay, a loss. Difference betiveen Gains and Losses or Net Gain ' Red ink. LOSSES. 165 •649 5t5 50 00 CAINS. 550 265 5tS 00 The material for this and th Mowing St.. tenient is found in the Trial lialancc on page 36, except the value of linsiild property, which is taken from the inventory given at the end of the Day liook, page 20. The process of worl.ing it is su simple th.-it it dues nut require an e.xplanatiun. 38 STATEMENT OF RESOURCES AND LIABILITIES. (Analysis of accounts that show Resources and Liabilities for the purpose of asctrtaining the Net Worth or Net Insolvency of the Business, I.— From Inventories. RESOURCES. LIAIItLITIES. Flour unsold as oer Inventory 3915 1120 2550 1450 2930 00 00 00 00 00 00 •3'5 1000 1000 •8650 Wheat " " " 2.— From Ledger Accounts. Cash Dr. Amount received $572$ 50 " Cr. '• paid out 3175 50 DiHerence, amount on hand Bills Payable Cr. My notes issued 2165 00 " " Dr. " redeemed 85000 •• " Difference, mv outstandinc; notes 00 Bills Receivai!LE Dr. Other people's notes received 1745 co " " Cr. *' " " disposed of . 295 00 Difference, others' notes on hand James Rimmer Dr. My acct. against him 3030 00 •• " Cr. His ** " me 100 00 Difference, he owes me W. Lingham Cr. His Acct. against me— I owe him . ... H. Corby Cr. His Acct against me 3000 00 " " Dr. Mv " " him 2000 00 00 Difference, I owe him * Stocks, Net Investment *8ooo 50 " '' Gain pet Statement 64950 " IVorth . 00 00 Proof * Red ink. 11965 1 1965 00 Questions for Review— CHAPTER II. Of what does a business transaction consist ? Upon what theory is it based ? Is this theory always literally true ? How many entries does the complete record of a transaction require ? Mention the four forms the records of a business transaction may require. What is the main object of a business record ? In what books are business transactions first recorded ? How is the Ledger usually opened ? Mention some of the most prominent accounts found in the Ledger. What is an Index to the Ledger ? What is the principal object in keeping it ? When an account is transferred to another page, what should be observed ? What is the first thing to be done after the transactions of a set have been posted ? How is this accomplished ? Why is a Trial Balance ♦aken ? Is the Trial Balance always a proof of the correct- ness of the work ? How often should a Trial Balance be taken ? How can the real value of property on hand be ascertained ? What is this process called in business ? In classifying accounts, what two grand objects are kept in view ? Analyze each of | the Accounts on pages 34 and 35. 39 CHAPTER III. r the Net IIILITIES. 3«5 oo ooo oo lOOO 56SO [965 00 00 00 it based ? record of ransaction books are Mention Index to ccount is thing to nplished ? le correct- n the real business ? each of CLASSIFICATION OF ACCOUNTS. The science of Double Entry Book-keeping is far more subtile and philosophical liii its theories and applications than would appear from any of the fallible or infallible jrules which authors claim as encompassing it. The mere fact of the Ihilatice or e(iuilibrium of debits and credits, which is the inevitable condition of each complete Irecord of a transaction — and so, of course, of the sum of any number of transactions is interesting and important only as it points to other and more vital truths. The [Science of Equations, which so aptly applies in each distinct entry, has a broader japplication to the entire subject of Wealth, which lies at the very foundation, not mly of business record, but of business itself. It has been clearly shown, in the preceding exercises, that the results of trans- ictions may be readily grouped or classified so as to exhibit distinct facts, each important in showing the condition of the business ; as, for instance, the amount of ;ash on hand, as shown in the Cash account ; other people's notes on hand, as shown in the Bills Receivable account ; our outstanding notes, as shown in the Bills Payable iccount ; the gain or loss fiom dealing in goods, as shown in the Merchandise iccount, etc., etc. We have also given in the preceding statements a form for gathering up these separate facts, and, by a proper combination and comparison of them, exhibiting the ;rand results which lie at the end of all faithful records, viz., the exact present condi- [ion of the business or its net worth, and the current condition of the business or its let gain or /oss between any two given periods. The accounts comprising the complete transactions of any business are suscepti- )le of an arrangement or classification, which will show at a glance, not only the :xisting condition of the business, but its exact measure of prosperity or adversity luring any stated period. A thorough comprehension of the nature and purpose of each account will at mce suggest its position in the statement or classification. CLASSIFICATION. Accounts are divided into two classes : JHeat and Representative. (See also Balancing Accounts," page 42.) Real accounts are those that show in the difference between their sides a resource ir liability. They are Cash, Bills Receivable, Bills Payable, Bank, Accounts with 'ersons, etc. Representative Accounts are those that exhibit either a gain or a loss, such as Expense, Rent, Salary, Interest, etc. ; and also accounts of a speculative character, |uch as Merchandise, Real Estate, Stocks, Chattels, etc. Every gain made in business is practically an addition to the Capital, and every )ss a decrease ; but it would not be practicable to credit or debit the account repre- inting capital as the separate gains or losses occur. 'I'hey are shown through the ipresentative accounts during the year, and, at the end of it are closed into Loss [nd Gain account. If, when this is done, the credit side of Loss and Gain account is le larger, an addition to the capital has resulted, and the Stock or Capital account 'ill be credited with the sum made ; if the debit side is the larger, a decrease of ipital has resulted, and the Stock or Capital account will be debited with the amount )St. Understanding the preceding classification of accounts, the student will Le able discern at a glance under what head an account should be arranged in a balance leet, and how it should be closed in the Ledger. 1 40 RESOURCES AND LIABILITIES. The following preliminary propositions will aid you in making out statements : A Resource, or Asset, in business language, is any species of property belong- ing to you, to which a financial value may be attached. All Resources having a fixed value may be continually shown in the Ledger accounts representing them. These are Cash, Notes, Bank and Personal accounts.'- All Resources having afiitctuating or variable value must be estimated by a cash standard, whenever it becomes necessary to know their value. Of such resources arc Merchandise of all kinds, Real Estate, Fixtures, etc.* A Liability is any debt owing by you. LiABiLiiiES being debts owing, they cannot vary much in form. They are represented on the Ledger either by Personal accounts or Bills Payable account ; the distinction being only as between what we owe without having given a written obligation, and what A'e owe on written obligations. The difference between the Resources and Liabilities of a business is, when the Resources exceed the Liabilities, its net worth, and when the Liabilities exceed the Resources, its net insolvency. One marked peculiarity of Resources and Liabilities, as shown in the Ledger, should not escape the learner's attention, viz. : Resources are invariably shown by excess of the debit, and Liabilities by an excess of the credit side of Real Accounts. Losses and Gains. — A loss in business occurs when less value has been received than given in exchange ; and when property depreciates in value. A gain occurs when more value has been received than given in exchange ; and when property increases in value. NET WORTH AND NET INSOLVENCY. The Net Worth of a concern is found by subtrac'ving the sum of its liabilities from the sum of its resources. is found by subtracting the sum of itsH — The Net Insolvency of a concern resources from the sum of its liabilities. Inasmuch as net worth or absolute wealth is measured by the excess of Resources I over Liabilities, the increase in wealth must be the result either of increase ofl resources or decrease of liabilities ; and decrease in wealth the result of decrease ofj resources or increase of liabilities. NET GAIN AND NET LOSS. The Net Gain during any period is found by subtracting the net worth at thej commencement form the net worth at the close of such period, t The Net Loss during any period is found by subtracting the net worth at tiiel close from the net worth at the commencement of such period, t In double ent.y book-keeping, accounts are kept in the Ledger with the various! sources of loss and gain. These accounts are closed at the end of the year into anj account called Loss and Gain ; when the transfers have been made into this account,! if the credit side (which shows the gains) is in excess of the debit side (which showsj the losses) the difference is the net gain, and if the debit side is in excess the differ [ ence is the net loss. * Assume what is practically true, that Cash, which is the measure of all values, must be competent to measure ilseii.l Hence, we call its value fixed. Personal indebtedness, wliether in the shape of notes or personal accounts, being uiilyr cash deferred, is, of course, subject to the same restrictions. _ I t If during the term any new capital has been added or any capital has been withdrawn, it must be taken inlo| account. The studen or Stat follotvi Dr. Bal. 1044 27 '532 17 500 6685 1000 79 25 1061 375 45 300 1 262 1 69 Net ca Net ca L.K I S. G, Beat 2 VV. B. Rol 3 Cash ... 4 Merchandi 5 Railroads 6 Bills Recei 7 Bills Payal 8 Real Estat 9 Robertson 10 G. C. Hoi • I Expense . 12 Interest... 13 W. W. Jor 14 John Cook 15 Conger Brc S. vJ. Beatt W. B. Rob Total net gj S. G. Beatt W. B. Rob * Partners' accc 'he net worth or ne 41 nents : r belong- ; Ledger xounts.'' jy a cash lurces are They are account ; a written when the xceed the le Ledger, shown by ccounts. n received inee ; and EXERCISES. T/ie student may test his familiarity with i 'le foregoing lessons by rendering analyses or statements of Losses and Gains, and of Resources and Liabilities from the folloiving exercises^ before proceeding to close the Ledger. TRIAL BALANCE.— Single Proprietor. Dr. Bal. 1044 >S32 500 6685 1000 79 1061 375 45 300 12621 27 17 25 69 Dr. Fodtings. $150 4170 5750 500 7000 15CXD 400 »54 1200 375 1400 120 300 23019 17 25 7« L.F, I 2 3 4 5 6 7 8 9 10 It 12 13 14 >5 Stock Mdse. (unsold .?2,ooo) Cash Robert Baker Real Estate (unsold $6,900). Bills Receivable Bills Payable Geo. Ritchie & Co Warner Bros Expense N. Jones Hunt & Co Interest and Discount ... . W. P. Graham Loss and Gain Equilibrium Cr. Footings. $7500 3125 4218 315 500 1200 75 139 2100 170 75 3601 90 12 Cr. Bal. 23019 69 71 «73SO 800 700 170 3601 Net capital at commencing, $7,350. Net Gain, $450.73. Net capital at closing, $7,800.73, TRIAL BALANCE.— Partnership Business. 12621 69 69 •1 C 1 liabilities sum of its Resources I increase of I ecrease of I Drth at the Drib at the the variousj ar into an I lis account,! ^hich showsl s the differ o measure 1ts1.1i, ints, being uiiKI t be taken imo L.F I 2 3 4 5 6 7 8 9 10 II 12 13 14 '5 S. G. Beatty (Partner)* \V. B. Robinson (Partner)* Cash ... < Merchandise (Value unsold, $5,159.50^ . Railroad Stock (Value unsold, $12,000^. Bills Receivable ... Bills Payable Real Estate (Value unsold, $8,000^ Robertson & Henry G. C. Holton & Co Expense Interest . . . . W. W.Jones John Cook Conger Bros Dr. $3000 9732 7350 12000 7000- 3180 7500 1 150 125 28 1795 1290 10 54150 10 Cr. ? I 6863 12000 4719 3719 5000 6180 150 920 1500 13 795 840 1450 22 50 25 54150 10 S. G. Beatty's net capital at commencing, $13,863.13. W. B. Robinson's net capital at commencing. $12,000. Total net gain, $2,039,25 ; each partner's share of gain, $1,019.62^. S. G. Beatty's net worth at closing, $14,882.75. W. B. Robinson's net worth at closing, $13,019 63. * Partners' accounts are treated precisely the same as the Stock Acct. ; the net amount owing to the partners being |the net worth or net investment of the concern. In this instance divide the gain equally. 42 BALANCING ACCOUNTS. Balancing accounts is placing a sufficient sum on the smaller side of an account to make it equal to the greater, and is done by adding the two sides of the account and subtracting the smaller from the greater, and entering the difference on the side that is less. Real accounts close, '• To," or '* By Balance." Before closing a speculative account, whatever property belonging to it remains unsold must be entered on the credit side thus : " By Balance Inventory*' as an off- set against its cost, which has already been placed on the debit side, after which the account closes into " Loss and Gain." Representative accounts close, " To," or " By Loss and Gain." As Resources are shown by an excess of the debit side of Real accounts, and liabilities by an excess of the credit side ; and as losses are shown by an excess of the debit side of the Representative accounts ; and gains by an excess of the credit side of Representative accounts, it will be necessary to open two accounts for these general results — one to contain the resources and liabilities, and the other the gains and losses. You will, therefore, open these accounts under the titles of " Loss and Gain." and " Balance,"* the former to contain the results of the Representative, and the latter of the Real accounts. As all gains in business must appear either in an increase of resources or a decrease of liabilities, and as all losses must appear either in a decrease of resources or an increase of liabilities, it will be plain that the two classes of accounts, Real and j Representative, must always run parallel. You will do well to observe particularly and follow out in practice the following | ORDER OF CLOSING ACCOUNTS. ist. — Take off a trial balance, and statements showing losses and gains and resources and liabilities. 2nd. — Open an account with "Loss and Gain" (if not already opened,) and another with " Balance,"* the former to contain the Losses and Gains, and the latter | the Resources and Liabilities. 3rd. — Ascertain by taking stock, the cost value of any property remainind unsold ; and enter this value on the credit side of its account, making the entry in I red ink, " By Balance Inventory," and transferring the amount directly to the debitj side of " Balance Account," making the entry in black ink, "■ To Merchandise," or the' name of the account from which the transfer is made. The Ledger accounts will each show, now, one of the four following results, viz : a Resource, a Liability, a| Gain, or Loss, and are in a condition for closing. 4th. — Deferring to close Stock (or the Partners' Accounts) till the last, becausel it is to be debited with the loss or credited with the gain from the Loss and Gainj account, commence with the next account in the Ledger. First ascertain whether itl shows a resource or a liability, a loss or a gain, and make the closing entry accordingly.l If the difference shows a resource or a liability, enter upon the smaller side, in redl ink " To," or " By Balance," as the case may be, and transfer the amount in black inkl to the opposite side of the " Balance Account," If the difference represents a gain! or loss, enter on the smaller side, in red ink, " To," or " By Loss and Gain," andl *Wheii the business is to be continued, instead of closing the Real Accounts into Balance Account, you bring do the balances, as is done in Set VI. To balance an account (which is usually done in red ink to distinguish it I'roitl ordinarj' entries) is to exhibit its condition ; if it shows an asset or resource it is closed temporarily, Hy Balance, aiiiil ruleO and footed to mark a period, and a condition at that period ; for the same reason, if it shows a liability it is closcill To Balance, but it is immediately reopened by bringing down the balance on the opposite side. 48 account account the side remains IS an off- hich the ints, and ess of the lit side of ;e general jams and nd Gain:' ', and the irces or a resources , Real and I t following gains and! ned,) and! the latter remaining le entry inj the debit! ise,' or the counts willl iability, al st, because! and Gain! whether itl ccordinglyj ide, in mi' ■in black ink\ nts a gain! Gain," and! 'ou bring down tinguish it rroitl y Balance, aiiiil ility it is closeJJ transfer the amount in the same manner to Loss and (lain account. Close all the accounts (except Stock or Partners), and transfer the balances as directed. The Loss and Gain Account will now show, on the debit side all the losses, and on the credit side all the gains, the difference being the net loss or net gain. The *' Balance Account " will show on the debit side all the Resources, and on the credit side all the Liabilities, the difference being the real interest or present investment of the proprietor or proprietors. f 5TH. — Close Loss and Gain account into Stock, or, if it be a partnership busi- ness, into the Partners' accounts, dividing the gain or loss, according to agreement. The Stock or Partners' accounts will now show the original investment increased by the gain or decreased by the loss ; the difference being the present net investment or insolvency. Inasmuch as the Balance account shows the same thine;, they must, of course, agree. /' 6th. — (^lose Stock (or Partners' Accounts) into Balance account, which must equalize that account ; it showing now, on one side, the total Resources, and on the other side the total Liabilities, and presenting in the most condensed form the exact present condition of the business. CLOSING THE LEDGER. In the preceding form, it was thought best to leave the Ledger in its open or current condition, the results of the business being shown in separate statements. When the object is to know simply the condition of the business, this method is sufficient ; but when it becomes necessary to mark the progress of the business in some enduring manner upon the Ledger, the accounts must be " closed," and the balance exhibited. The cbject of closing the Ledger is to put an end to its current condition by disposing of the Representative accounts ; for inasmuch as the proprietor is to be credited with his net investment, whenever that net investment is increased by gains, his account should get the benefit of it. As it would be impracticable to carry the i separate gains and losses to the proprietor's accounts when they accrue, they are per- mitted to remain in the accounts producing them till the ledger is closed. In real business, books are usually closed once a year, and iu some establishments every six 1 months, thus marking an era in the business. We shall now take the student carefully through the process of " closing the I Ledger." Having gone through the process of Journalizing, and posting the transactions I in Set I, and taken off a trial balance to satisfy ourselves that the work has been properly performed, and statements showing the losses and gains and the resources and liabilities, we now proceed, according to the following instructions, to close the 1 Ledger accounts. We open "Loss and Gain " and "Balance " accounts as directed on pap;e 42. The first account (after Stock) is cash. This account represents a resource con- !sisting of cash in hand, $2,550. We close the account by entering the diflorence, in \red ink, " By Balance," on the credit side, and footing up the sides, drawing double \red lines underneath. The red ink entry, or balance, is transferred immediately to |the debit side of Balance account. The next account is Flour ; if not already done, you will now place the inventory Df unsold flour, $3,915 (given at the end ot the Day-Book, page 29), on the credit side of the account in r^^ ink thus, "Jan. 20, By Bal. Inv. $3,915," and transfer it It once to the debit side of Balance account thus, " Jan. 20, To Flour $3,915," in Ylack ink. The inventory having been placed on the credit side of Flour account, jthe account now shows (as you have already ascertained in the loss and gain state- lent) a gain of $550, and it is closed on the debit side thus, " Jan. 20, To Loss and « 1 c: 44 Gain $550," in red ink, and the gain is transferred at once to the credit side of Loss and (Jain account thus, " Jan 20, By Flour $550," in black ink. The next account, Wheat, is closed in the same way The next, Bills Payable, shows a Liability, consisting of our unredeemed Notes, and is closed " To Balance $1,315." This balavce is transferred to the credit side of Balance account. Bills Receivable account is closed in the same manner as Cash, the balance being trans- ferred as a resource to Balance account. The next account, James Rimmer, is closed in the same way. The next, W. Lingham, shows a Liability, and is transferred to the credit of Balance. Robert Thompson's account already balances, and we close it by simply footing and ruling it H. Corby's account shows a Liability, and the balance is transferred to the credit side of Balance. The next account, James Miller, already balances ; and as there is but one entry on each side, we close it by simply ruling the double red lines. Expense account shows a luss, and is closed " By Loss & Gain," $165.50, and transferred to the debit side of Loss and Gain. We have now the result of all the accounts exhibited under the Ledger heads of Loss and Gain, and Balance. The Loss and Gain account should agree with the Loss and Gain statement, and the Balance account with the Resource and Liability statement, and it will be well to compare them just here. If the balances have been properly transferred, these accounts, together with the (unclosed) Stock account, must be in equilibrium. To test this, we may (but not necessarily) take a Trial Balance of these three accounts, which we will call the SECOND TRIAL BALANCE. Dr. Cr. Stock Loss and Gain Balance % 16s 1 1965 50 00 50 % 8000 8IS 3315 I2I30 I2I30 50 00 00 50 After proving by this test that the balances have been properly transferred, we proceed to accomplish the grand object of closing the Ledger, by carrying the differ- ence between the two sides of the Loss and Gain account, or, in this .case, net gain of $649.50, to the credit side of Stock account. The Stock account now contains the capital invested, increased by the gain, which must equal the /;vje«/ worth, as shown by the balance account, We now close Stock account into Balance, which must produce an equilibrium of the Balance account, and complete, in that account, the Record of Resources and Liabilities. The Balance account is used for its convenience in collecting, under one title, all the Resources and Liabilities. The same effect may be produced by bringing down the balances under the Rral accounts. The latter method is adopted in busi j ness where the same Ledger is continued in use the next year. The student should remember that in no one thing does the proficiency of al practical accountant more plainly manifest itself than in neatness of arrangement andl execution. " He should observe particularly the form adopted in ruling, and be careful tcl enter all Balances, Inventories and ruling with red ink, and all Transfers with blac\ ink. after NdTE.— Tlie form adopted in closiiis the Ledger on the following p.iges is submitted as a model to guide you hereJ r I Dk. 1894 Ian Tu Jan. 4 6 II •S 17 To Ian, I 2 3 6 12 20 Toi " ( " E " I "I an. ti «i i< I 2 3 5 10 hi ToS " Bi " C << i •• W " L< * Sur 45 SPECIMEN LEDGER- CLOSED. See Explanation, pages 43, 44. I)K. STOCK. Cr 1894 !.ui. To Hii lance, 47 Si'ifo 8650 00 1894 Fan. I 20 By Sundries,' 30 *' Loss ami Gain, ] 47 8000 649 8650 50 50 CO CASH. Jan. I tt 4 It 6 t( II i( <5 n 17 To Stock, J. Rimmer, Wheat, R. Thompson, Bills Kec, 30 4000 50 Jan. 2 30 100 00 3 30 «25 00 5 3« 230 00 9 3> 975 00 10 31 »75 00 12 3' 120 5725 00 50 «5 18 JO Ry Flour, •' Wheat, " Kxpense, " H. Corby. " Bills I'ayabl 00 CO 00 00 00 ( It 01 FLOUR. an. I To Stock, 2 " Cash, 3 " Bills Payable, 6 '• H. Corby, 12 20 *• Bills Payabl?, " Loss aiKi dain. 30 3000 00 Jan. 6 30 300 00 '3 30 650 00 «< 11 30 3000 00 31 i^S 00 47 S5« 7815 00 00 By J. Miller, " J. Kinimer, <( 1. '• Hal, Itnt'iitory. 30 31 ^7'| 1 1 1 1300 1400 1200 30 '5 1 00 00 00 GO .7815 00 WHEAT. I 2 3 5 10 To Slock. Bills Payable. Cash, it W. Lingham, >i Ldss and (Iain, ,30 1000 3 *i >7 Ian. To Wheat, Jan. 10 << 16 20 BILLS PAYABLE. 1S94 31 650 00 ! Jan. 2 3' 17 200 1:15 2165 00 00 *• 3 12 16 Hy Wheal, " Flour, it *. "II. Corby, BILLS RECEIVABLE. 30 «75 00 Jan. IS 30 120 00 17 30 1300 00 • • JO 3« «5o '745 00 00 By Cash, »4 44 " l<;i!i.iic.- JAMES RIMMER. W. LINGHAM. ROBT. THOMPSON. 30 3' 600 37S 975 00 UC) 00 Jan. 15 By Cash, H. CORBY. To C.ish, • Bills Payable, ' h.ii;nn:e. 3' 1000 00 Jan. 6 3' 1000 00 47 1000 3000' 00 By Flour. Cr. 30 , 200 30 650 3' 315 3' IOCX3 2165 00 00 00 00 00 3« 3« '75 120 47 1 .1 y < 1745 00 00 00 To Wheat, it t> " Flour, 1. >. 1 30 30 30 31 2S0 1400 1200 3030 00 00 CO 00 00 Jan. 4 .•0 By Cash, " lialaiicc. 30 47 100 3030 CO (J' ■ C3 Jan. 20 To I'.aliuice, •t7 10 1000 00 Jan. 10 «7 By Wheat, tft t4 31 31 450 550 1000 00 00 00 975 975 00 00 30 3000 00 30C0 I 00 Dr. 1894 Jan. I 6 Ian. 9 18 Jan. 20 Ian. 20 Tc • t 44 *\]n, for «liiili I (»nve cnnh •**.?"'?. nirl •'• !• Slicrry's hdIi- for lialnncc $125. 27— Received from 'tliomas NIoorc, cash on nccount, S150, 29— I'ai'l cash for Wood, S24 ; (leaninn Store, X4.51). " Received from Tliomns Moore, cnsli in full account, •*'iji). " I'nid cash for Clerk's Salary, .S75. litvatlory ol goods rcmaiitiuji ini.wU ; Mi'rihaniii.u\ 1*5,500, S(l Co/>iltil at coinnien(ins,fi<),liyo; ItWiffrcw, $1000 ; A\/ 1^,1111, '( ti (i Aug. 4. " 6 (( (1 Aug. ST. (( i( «( li Sept. 4. " 7 <( (1 Oct. (( .( u 11 Oct. 4. " 8 (< <( Oct. .1 ' ) (1 (f (k it/t a Net Capital, sustaining a loss greater than Capital, and closing Insolvent, BOOKS USED-DAY BOOK, JOURNAL, LEDGER AND BILL BOOK. See Jorni of Bill Book at the end of Sit. Ottawa, March i, 1894. Leased a store of T. B. Dean, at $600 per annum, and commenced the Furniture business, investing as follows : Cash, $1800. Stock of Furniture on hand, §1500. Note against A. Overall for •i?7SO, dated Jan. I7tli, 1894, at 2 months. Total investment, $4050. Bought of G. S. Tickell, Belleville, on one month's credit, 15 Carved Rosewood Centre Tables at $50, 6 doz, do. Arm Chairs at .%o. Total, Si no. 2 — Sold W. R. Barber, on his note at 15 days, 10 Carved Rosewood Chairs at §S, i do. Centre Table, $75, i Gothic Hall Stand, $25. total !?i8o. 3— Bought of Jakes & Hayes, Toronto, on acct.. 10 sets of Enamelled Furniture at $75, 6 do. Black Walnut at $150, lo Extension Dining Tables at .'?2S. Total, Si. 900. 4 — Sold W. H. Sherman for Cash, i set Enamelled Furniture, Sioo, i Extension Dining Table S40, 8 Carved Chairs at S8. Total S204. 5 — Sold W. \V. Jones, on his note at one month, with interest at 6 per cent., i set Enamelled Furniture, Sioo, one Extension Tab\ S40, l Dressing Bureau, S35, i Rosewood Tete-a-Tete, S50, I Gothic Hall Stand, 828, i Card Table, SS, i French Bedstead, S22, i Cottage Bedstead 815. Total $295. *6— Settled with Jakes & Hayes, by giving them my note at i month, with interest at 7 per cent., in full of acct., $1900. 9— Bought of J. B. Ashley, on my note at 10 days, 15 Black Walnut Book Cases at S5o, 2 doz. do. Arm Chairs at S60. 20 Curled Hair Mattresses at S20, 20 Double Leaf Secretaries at SjS, 25 Music Racks at !?5- Total S2,245. 10 — Sold G. W. Maybee, on acct., i Carved Rosewood Centre Table, S60. 2 doz. Arm Chairs at .SjO, I set Enamelled Furniture, S80, 1 Black Walnut Sofa Bedstead, S50, 2 Extension Tables at $30, 2 Gothic Chairs, B. W. stuffed at Si 5, i Easy Rocker, Si 2. Total S392. II — Bought of Jakes & Hayes, on 3 months' credit, an assortment of Furniture amounting, per invoice, to S3 500. " Paid Cash for insurance, S12S. *This note is to bear interest, but you make tlie Journal entry as though it were not. At the maturity of the note you will deal with interest. The Dr. side of interest acct. shows what interest costs you, and the Cr. side wliat interest produces for yuu. It closes either to or by loss and gain. i 54 15— Sold S. G. Realty, for cash, 2 Black Walnut Bureaus at ^JO, I Rosewood Parlor Set, $400, i Enamelled Bedroom Suite, $700, i Single Bedstead, |8, I Quartette Table, I9, i Lady's Arm Chair, .ii!i2, i Black Walnut Library Book Case, |7S. Total $764. 16— Sold W. McKeown, for cash, i Carved Rosewood Secretary, $120, 3 Patent Spring Beds at $60, I Walnut Centre Table, !ji!50. 2 Rosewood Bureaus at $40, 2 Arm Chairs at fiio. 2 " Sleepy Hollow " Chairs at $25, i Black Walnut Parlor Suite, .^300, i Side What-not, $9. Total $809. 17 — Paid cash for three months' Rent, §150, Advertising, .*2S. " Bought of Jakes & Hayes, on acct., Furniture amouniing, per invoice, to $2,150, '* Bought of H. W. Huffman, on my note at 3 months, Furniture amounting to $550 18— Received from G. W. Maybee, cash on acct., .$150. " Sold W. Johnson, on his note at three months, i Hall Stand, $5, 6 Parlor Chairs at $3.50, i R W. Tele-a-Tete, $30, i Black Walnut Sofa. $30, i Large Dining Table, $14, i Piano Stool $S, I Music Rack, ^S- Total .I113. 19 — Sold Warner Bros., for cash, 2 Bearoom Suites at $50.60, 2 Rosewood Parlor Suites at $200 Total $501.20. 20— Received from G. W. Maybee, cash in full of acct., $242. " Received from A. Overell, cash in full for his note of Jan, 17, $750. 22 — * J. B. Ashley renewed for one month my note for $2245, due this day. Interest @ 7% on renewal $14.64. Note. — Tlic student must work out all interest. .See instructions at foot of this page. 24— .Sold H. Corby, on acct., 20 doz. Kitchen Chairs at $8, 10 doz. Rush Bottom Chairs at $18, Total, $340. 28 — Bought of Smith & Co., Kingston, on note at three months, assortment of furniture, amounting, as per invoice, to $1,500. April 1st — Paid G. S. Tickell cash on acct., $500 8 — Received from W. W. Jones cash in full for his note of the 5lh ult., and interest thereon to date at 6 per cent. Face of note, $295. Interest $1.65. 12 — Paid Salaries, $180. Sundry expenses, $25 16— Paid my note 6th ult., favor of Jakes and Hayes, with interest to date Face of note, $1,900. Interest $14.94. Iiiveiitoiy oj merchandise unsold, $5. 336. 34. Ncl capital at commencement, $'4,050. Net loss $6,053.39. Net insolvency at closins; $2,003 39- REMARKS ON THE BILL BOOK. The Bill Book should never be omitted in any business where notes are i^iven or received. It is so simple that the student will see, by inspection, its utility. All necessary explanations are made by the headings of the different columns. The i^recaution of closing the Bill Book and showing the amount of bills unpaid is necessary in a business where any considerable number of Bills are given or received, in order to maintain harmony between this book and the Bills Payable and Bills Receivable accounts in the Ledger. It will be seen that the Bills entered in the following forms are taken from the transactions of Set IV., and hence the notes on hand and notes outstanding, as shown by Bills footed up, will be found to agree with the balance shown in the proper Ledger accounts. 'n business calculations it is not customary to enter fractions of a cent on the account books ; consequently, in all computations throughout these sets, where a fraction of a cent less than one-half occurs, we take no notice of it ; bin where a fraction of half a cent or more occurs, we call it one cent. * Under the head of " Entries for Renewals of Notes," refer to Index, you will learn how to make this entry in the Journal. In woncing interest, first find the time, taking c.ire to get the actual number of days (including, in the case of notes and drafts, the three days of grace). The renewal note given on the 22nd of March will mature on April 25th, or in 34 days. Having found the time, next find the interest for one year (of 365 d,iys)on$2245,at 7 percent., which is $157.15 (or 2245 X —\ The interest for 34 days must be -2i of 157.15, therefore 157.15 X 34 and the result ■^ by 365 will give the interest to be added to the new note, namely, $14.64. The formula in brief is H^' x -^ X -3* = $14.64. 1 100 365 ^ ^ ' ;>;) .?4oo, I ly's Arm s at $60, " Sleepy al $809. .50, I U no Stool s at $200 @ 7% on rs at $18, .mounting, on to date 339. lotes are its utility. s unpaid Tiven or rable and rom the nding, as m in the uently, in all ;ice of it ; but i entry in tlie i case of notes 25th, or in 34 iichis$i57-'5 365 will give I ai Qi 2 ^ ?. o &5 0^ ~ to — .-J bji„ 0\ - •3^Q AOM •Jdas •3ny •A|n|" ■aupf ^ijjdv" ^ « le, $1,900. g 2 fa ^>a u w C/5 M •a P C< s: M ?, I " 1 1 a: 1/ i 1 ■?, fa . 2 nd ho red. - -3^ c 1 rt -^Z .„ c c e 2i 1 u * JS ^ N " 1 * 1 ?J 1 NO 1 f ) vO Pn On N I - N N *•* ! u Q z 111 1 is •33a 1 •AO|SI 1 •P() 1 •Idas 1 •3nv 1 •X|n|- 1 •" •aun| 1 •Xbiv 1 •idv 1 On UBiM 1 •cia^ 1 •uc| 1 « ! •* t rf «r »!• 0\ f^ ON o\ ON >i 1 C<0 00 00 c« 00 »^ 1 "" -" ■" — . 1 , •§2| 1 S -a c E E H fi 1 ri M ro 1 vO On r-. n 00 . 1 N PI B ^ H >< u ^ C4 lu d u ,£ H- ^ j: ^ j; cy ^ < « cU, t/J ^ x: 1 "- ^ CC ^ P a ji rt ^ S _:, ! •- c (U ♦J 1. \ 1 i* - &■ r\ - • • 1 1--. pj 00 •— 1 vO C^ N N ] c 1 \l ! -S M3 £0 •^3: " S '- 3 So •^ ? 5 R c rt C-fi o rt ■M._ ii j: ■ o * u -a, 1 u J2 O u o >>— •- *^ u " . . u c (3 *- '"' cj X ,1-; •3.5 :s S 3 be = n ■' rt '"•S — " 2 o- ■= j; S5 E g d u rt ^N Ex o S o S f. - C r. C - 1 u u r* i> E J*^ f » 56 BUSINESS FORMS. A thorough acquaintance with the forms of business papers is indispensable to every one who would master the science of accounts. Not only should their nature and use be fully understood, but the ability to make them out readily and correctly should be acquired. For this reason we ask the student to make out formal bills and invoices of merchandise bought and sold, write proper receipts for moneys paid or re- reived, draw up forms to represent bills receivable and bills payable, forms of the drafts and orders referred to in the transactions of the different sets, and copy them until he can write them out without referring to the book. Mr. W. a. Should the firm, with the \ BILLS AND INVOICES. A Bill of Goods is a description of the quantity and price of goods sold, with the date of the transaction and the names of the purchaser and seller. An Invoicf. is a full account of merchandise, in which the marks, numbers, con- tents, nnd value of each package, together with all charges, are described. When anything is purchased for another, or is to be charged in account, it is well to take a bill of it. The bill will be a reminder to make the proper entry in the books concerning it, and will also serve as a voucher for items, prices, etc. Even when cash is paid, the bill is frequently needed for reference. Invoices are usually pasted in a book, or neatly folded and marked on the back with the name of the person from whom bought, the date and the amount, and then put up in monthly packages for safe keeping. BILL NOT RECEIPTED. Mr. J. A. A Mr. John S. Ewing, Toronto. Toronto, Nov. ist, 1894. Bought of Geo. Ritchie & Co. Terms Cash. 4 yds. Black Broadcloth, 10 " Factory Cotton, 15 " Muslin, 20 " Red Flannel, 4 doz. Linen Ildkfs , 5 only Scarfs, at I4.25 $17 O.IO I 0.25 3 0.40 8 2.00 8 1. 00 5 42 CX3 00 75 00 00 00 75 Notes. — Wlieii settlement of an account is made by contra account, write, " Settled by Contra account " and tlnj name. When the word " only " is used, it means single, as 5 only scarfs, means 5 single ones. 1894 Feb. I 14 9 March 4 April I May 6 Messrs. Smii £* , (t 8 • ( 28 If 9 Gentlemen,— W. presentation, and ob INVOICE IN Messrs. VV. (Terms — 3 ;/ 50 copies 20 copipi 57 ble to nature rrectly Us and I or re- of the y them Id, with :rs, con- iint, it is y in the . Even the back and then 1894. & Co. Mr. W. a. Roblin, Trenton. BILL RECEIPTED. Belleville^ Nov. isl, 1894. To Conger Bros., Dr. To ic yds. Cairbric, *' 20 " Gingham, " 5 " Broadcloth, ... •' 2 doz. .Spools Thread, Received payment, CONGER BROS. $0.15 $ I 0.30 6 400 20 0.50 I 28 50 60 CX3 00 SO Should the above bill be receipted by a clerk, his own name should be signed under that of the firm, with the word " per " placed before it. Mr. J. A. Moore, ITEMS OF AN ACCOUNT. Halifax, Jan 2nd, 1894. To RoBEKTSON 'Si Henry, Dr. 1894 Feb. March I 9 4 I 6 To 4 yds Broadcloth " 3 " Can. Tweed, " I yd. Vest (Broadcloth), Cr. By Cash " Order on Beatty & Wallbridge, $20.00 Soo $5 00 « SO $20 4 5 00 SO so April May 30 25 00 Balance due, 5 00 MONTHLY STATEMENT. Montreal, /an. 2nd, 1894. Messrs. Smith & Jones, Winnipeg. To Sinclair, Jack & Co., Dr. 7 00 00 75 i 00 j > 00 i 00 \2 75 )unt • ami the 1894 Nov. (4 .1 I 8 28 To Mdse, as per Invoice at 3 months, •« " " •• at 4 " " «• " " at 30 days, 11 9 Cr. By Goods relumed. $100 20 .... .... 500 00 .... 400 00 1000 20 57 00 $943 20 (lentlemen, — We shall draw upon you on Wednesd.iy next at go d.-iys for amount of account. Please honor draft on 1 presentation, and obHge, Yours truly, ' SINCLAIR, JACK & Co. INVOICE IN WHICH BOTH TRADE AND CASH DISCOUNTS ARE ALLOWED. Belleville, Jan. ^th, 1894. [Messrs. VV. J. Gage & Co., Toronto, (Terms— 3 mos. or 3/. c. dis. for cash.) Bought of Robinson & Johnson. 50 copies " The Canadian Accountant "| ... Trade discount 30 per cent. 20 copies "Johnson's Joint Stock Book-keeping," Trade discount 25 per cent. Cash discount, 3 per cent. at $2 M 25 100 00 30 00 70 25 00 6 25 18 88 2 $86 00 75 75 66 09 58 INVOICES. * Sales, 24. ) Folio, 325. i Messrs. Beattv & Wallbridge, Belleviile, Ont. Forwarded— G. T. R. (Terms — Note at 4 mos or 3/. c. (iis. for cash.) DOMESTIC INVOICE. Montreal^ Oct. 28M, 1894. Bought of Sinclair, Jack & Co., Importers and Wholesale Dealers in Groceries, I 5 Hlf. chests Tea (Y. 11.), " S. J. & Co., 14" s 78, 14, 73, 14, 74, 14, i59, 75. i5> 69, 13, ;o, 299 72 $215 28 6 4 •• '• Gunpowder, " Chinaman," 53, 9 83, 15, 82, 15, 331, 85, IS, 81, 15, 60, 271 80 216 80 10 4 Bags Coffee, Java, " A.B.," >3 128, 4, 105, 4. 494. 131, 4, 130, 4, 16, 4/8 24 114 72 14 2 " Laguayra, "C.T.," «5 228, 113, 4, 115, 4, 8, 220 18 39 60 5 Boxes (loc) Laundry Soap, 60 ea. 300 07 21 00 4 Doz. B. L. Brushes 2 2 2,50 3.00 Cartage, II 00 25 E.J. 618 65 Note.— The 1 (ioods consigned f you should know t upon the invoice " iliihiry way, ahhot Creditors. FOREIGN INVOICE. Glasgmv, ^th August, 1894. Invoice of one Packaqe, marked and numbered as per margin, shipped per Hibernian SS. from | Glasgoiu for and on account of Messrs. Geo. Ritchie & Co., Belleville, Canada. Bought of Arthur & Co., London Warehouse, Old Change, G. R. & Co. Bradford Warehouse,G range St. B. No. 238. I 4 Pes. Check Wincey, S6i, 2 574, " " 56i, 57, 58, 59, Shepherd, " 5'i. 54, All-Wool Tartan, 2J8 6 £. s d. 5 «4 £. s. d. 2 3 4 .30 4 I 2 6 23oJ 5oi 1054 73 8 94 7 8 loi 1 13 8 436 35 6 39, 3, 2, Clan Serge, 39i 40, 3>, 2, 2, 51, 2374 246 134 »3 7 2 >7 3 44 I 40, 42, Super " Box 424 i6S 2 19 IS 6 53 5 • N The fi OTE.- jures Sales i -The figures on the left are the invoice numher mderneath the items arc gross weights and tare 5ook 24, folio 325. s hy which s, or ineasu any part renients. icular line of goods would be identiliccl. C. W. Thomp! |The Hasting: 00 54. :o., Groceries. 215 28 216 80 114 39 21 II 618 72 60 00 CX) 25 65 894. n SS. from & Co., o. 238. ;. cl INVOICE OF SHIPMENT ON SOLE ACCOUNT. Invoice of Mrechandise shipped per Steamer " Neptune" ist November, 1894, and consigned to E. T. Humbly, Port Hope, to be sold on commission. 500 bbls. Extra Superfine Flour, 100 " Baker's Spring, " .... 200 •' Goderich Salt, .... .... Paid Insurance .... .... .... E. &0. E. Hamilton, Nov. i, 1894. S. S. Edsall, Consignor, .at$8 • 7-5° . 1.50 $4000 75° 300 40 .55090 Note. — The student will use the above form of invoice for ii single shipment, and the following for a joint shipment. (loods consigned for sale on commission must not be in\oiced as though they were sold. Uesides the difference in form you should know that if the man to whom you have consigned goods should fail, and you had taken the precaution to put upon the invoice " Consigned to" instead of" liought of," you can step in and claim your goods. If invoiced in the or- dinary way, although it wa.s understood that the goods were only consigned, you would have to take rank with the Creditors. INVOICE OF SHIPMENT ON JOINT ACCOUNT. Invoice of Merchandise shipped per Steamer " Passport" and consigned to fohn Cook, Belleville, to be sold on joint account of Shipper and Consignee 500 bbls. Goderich Salt. . . . . 400 *' Extra Family Flour • Charges. .ati^i.so 7.50 Insurance on ^3750, at i^ per cent, Drayage $25, Labor, .^lo, Cooperage .?4, Wharfage .if 13. Hamilton, fune I, 1894. VV. B. RoiilNSON, Consignor. « 750 3000 25 $3750 108 56 52 .^3858 25 25 CREDIT NOTE. A Credit Note is an acknowledgment of an en or in an invoice, or of goods I returned, and is in form similar to an invoice. Instead of the words ^'■bought of," the words " credited by " are used, and it is usually printed in red ink, that it may readily [be distinguished from an invoice. Form |C. W. Thompson, Esq, Montreal, fan. z^th, 1894. Belleville. Credited by Sincl.air, Jack & Co. i chest, 56 lbs. Y. H. Tea Short Invoice of 5th January. 42c $23 52 BILL FOR SERVICES, IThe Hastings Smelting Works Co. Belleville, Oct. 26th, 1894. To J. W. Johnson, Dr. 1 be identifiwl. For services as Auditor, $50 c • MSI...- I0> GO ACCOUNT SALES. An Account Sales is an exhibit of the sales of goods disposed of on commis- sion, with the charges incurred thereon. When goods received on commission are sold, the agent makes out, for the in- spection of the consignor, a detailed account of the sales of said goods, together with- such charges as have been made on account of same. In making out an Account of Sales, the mode of procedure is, to turn to the proper account in the Ledger, and from thence refer to the necessary details as found in the books of original entry. A variety of forms is in use : those given are most commonly adopted in business- SHIPMENT ON SOLE ACCOUNT. Accoioit Sales of loo kegs Butter, on account and risk ^Ashley & Co., Belleville, Out., Received per Steamer *' Magtiet," October 20, 1894. 1894 Oct. 23 (< 20 tt 23 Sold for cash ICX3 kegs — 6800 lbs net Charges, Freight in cash .... .... Commission, 5 per cent, on sales. at 20c., Ashley ti Go's proceeds Remitted by sight draft. E. & O. E. Montreal, Oct. 25th, 1894. H. M. Alexander, Consisfitee. JOINT ACCOUNT. Account Sales of Merchandise received per Steamer " Passport," June ^rd, i8g^, from W. B. Robinson, Hamilton, to be sold on joint account of Shipper and myself, each 14- 1894 Sept. Oct. June Sold James Smith for endorsed note at 4 mos., with interest at 9 per cent. 300 bbls. Goderich Salt, at I2.00 200 " Extra Family Flour, .. .... at 8.50 Sold Winters, Smith & Co., for cash, 200 bbls. Goderich Salt, at 1.75 200 " Extra Family Flour at 8 25 Charges. Freight and Drayage, .... ... Wharfage, cooperage and labor, .... .... Commission and Guarantee at 2 per cent., .... Interest on charges paid, ... .... .... Total net proceeds. Your J net proceeds, .... ... .... Ouri " " E. & O. E., J. J. SOLMES, Kingston Ont., Oct. $/h, 1894 $600 1700 350 1650 95 50 25 86 3 50 2045 2045 ^4000 I4300 210 4090 I4090 Note.— See th 61 AN EXAMPLE OF AN ENGLISH ACCOUNT SALES RENDERED TO A CANADIAN CONSIGNOR. Account Sales of 50 doxes cheese ex S.S. ^'Oregon" at Mont real, June 6, 1894, sold for account of Glencoe Factory^ Belleville, Out, Champion W E. &0.E, SO Boxes, w. f. c 29 21 Net, . . . 44/6 Discount- CHARGES. i/'9/3 4/7 '^ Freight, Primage, Quay, Porterage, Dues and Customs f Entry, etc., > 4/2 8/4 4/2 1/8 I Cartage, Porterage, Warehouse, Rent & Fire Insurance, / Advance in Canada, .... .... .... Commission and guarantee on £66, -12. -3., at 4 %. Brokerage paid here, .... Net proceeds to Cr. of Glencoe Factory, .... Liverpool, Eng., July 3, 1894. Hughes Bros., Consignees. 5« 2 66 £(>S 57 8 Suppose that the iJ8,-i5.-i., is converted into C.anadi.-in Currency at 8 y (that is 8 ,', over the old par of exchange, 4.44 4/9,), it would equal $42.02. At the end of the book you will find the method of converting sterling into currency, and currency into sterling. The formula for above is ; ;CB.i5., i = /;8 ^ = ^8.754. ;<;8.754 X - (old par) = $38.91 old par. 38.9i + 8;!;; = 38.9i + 3.ii = $42.o2. RECEIPTS. A receipt is an acknowledgment in writing of having received a certain sum of money, or other valuable consideration. When a payment has been made, a receipt should be taken as proof of the payment. It may not in all cases be necessary, but when important interests are involved nothing should be left to uncertainty, if it can so easily be avoided. Personal representatives of estates of deceased persons should always protect them- selves by obtaining receipts. A receipt often saves misunderstanding and loss of friends as well as loss of money. Receipts should be carefully preserved, as many instances have occurred in which claims have been presented after they were paid. When not written in a book especially prepared for the purpose, they should be kept in a place of security, so that they may be readily produced if needed. RECEIPT FOR PAYMRNT ON ACCOUNT. Received from W. H. Yourex, Fifty dollars on account. $50 Toronto, /a/t. ist, iSg^. E. SCARLETT. RECEIPT IN FULL OF ACCOUNT. Belleville, Jon, ist, iSg^.. Received from W. R. Ross. Seventy-five dollars, in full of account to date. $75 CHAS. ADEN. Note.— See the method of filing papers at page 73. 62 RECEIPT IN FULL OP ALL DEMANDS. Nopanee, Jan. ist, iSq4. Received from Ilcnry Bro!!., One Hundred anrc jit becomes due, and it must be paid to the holder. Should suit be brou^^ht, liecause [not paid, it would be brought upon the note instead of upon the account. FORMS OF NOTES. NEGOTIABLE WITHOUT INPORSPMRNT. !?I00. London, Od, 28///, 1894. Three months after date, I promise to pay t S. G. Healty, or l)eartr, 3nc I Hundred Dollars, value received. *TII0MAS WILLIAMS. IJioo. NKGOTIAIII.E liY INDDRSEMKNT. Hamilton, Oct. lith, 1S94. Three months after date, I promise to pay .S. Clare, or order, One Ilundieci I Dollars, value received. THOMAS WILLIAMS. N0N-NEU0TIA1II.E. .*;ioo. Toronto, Oct. 2M1, 1894. Three months after dale, I promise to pay George Dean only, One Hundred Dollars, lvalue received. THOMAS WILLIAM.S. PAYABLE ON DEMAND. Sioo. Kingston, Oct. 28///, 1894. On demand, I promise to pay Messrs. Jones & Brown, or bearer. One Hundred I Dollars, value received. THOMAS W1LLL\MS. PAYABLE AT HANK. ^lOD. Bianljord, Nov. 2StA, 1894. Three months after date, I promise to pay John Smith, or order, at the Bank of ICommerce here, One Hundred Dollars, value received. PETER J 'VILSON. PAYABLE AT BANK, WITH INTEREST. §340.42, Lclleville, Oct. 2%th, 1894. Three months after date, we promise to pay Messrs. East & West, or order, at the lerchants Bank of Canada, here, Three Hundred and Forty and y^ Dollars, with interest at seven per cent, per annum, value receiv'ed. SMITH, JONES & CO. Note. — It is always desirable \.oJix a place for the payment of a note, which is usually the bank at which the maker lieeps his account. Hence when making a note, state where you intend to provide funds for its payment, as in the last pample. To secure interest at 7 per cent, after maturity, should the note not be paid when due, add the words, an nvll f/ter as before maturity until paid, after the word annum. * Drawer, t Payee. 66 JOINT NOTE. ^300. Montreal, Jan. \st 1894. Three months after date, we jointly promise to pay K. Brown, or order, Three I Hundred Dollars value received. E. T. IIAMBLY, J. G. SHERRY. JOINT AND SEVERAI, NOTK. $210, Port Hope, Oct. 2%th, 1894. Ninety days after date, we jointly and severally promise to pay Geo, Wallbrid^e, or order, Two Hundred and Ten Dollars, value received. JOHN BROWN, WILLIAM BROWN. NOTE MADE HV A MAN WHO CANNOT WRITE. Si I CO Belleville, Nov. t,th, 1894. Three months after date, I promise to pay to the order of Nelson Lingham, Onel Hundred Dollars, for value received. ^iias^Thompson, Kj/,„^,rw. ROBERT f McNAUGHTOX. i. KF.in, I Si E. mark. NoTK.— KeaU tliis over to llic maker cartfully, thai you may bu aljlc to prove that lie knew what lie signed. AN ACCOMMODATION NOTK Is one made payable to the order of an indorser, for the purpose of raising money for the maktil at a bank or from a private lender. After it is indorsed the holder would have recourse against botli| parties. If not paid at maturity, notice of non-payment must be sent to the indorser immediately, 1 recourse against him will be lost. See protests. Questions for Review.— CHAPTER IV. What three qualities of an Accountant are essential to success ? When the teral of a bill is expressed in days, when do you begin to count the time to run ? GivJ examples When the term of a bill is expressed in months, how do you determinJ when it falls Hue ? Give examples of bills drawn on different dates and running thj same time, falling due on the same day. Explain how the term of payment may extended three or four days, by advancing the date of bills one day. When the lasl day of grace of a bill falls on Sunday or a bank holiday, when is it payable ? GivJ examples of bills dated on different days and having the same time to run, in montJisj falling due on the same day. Give rules to determine when to date bills in order advance the day of payment, and to tell the precise day when they become dud What is a Bill of Goods ? An Invoice? An Account of Sales ? A Receipt? Givi different forms of Receipts. Are Receipts necessary in business transactions ? Wha ia a Draft ? How is a Draft accepted ? Give rules for making the Drawer's, Drawee] and Payee's entries in case of a Sight Draft. In case of a Time Draft. What is; Order ? How is the signature to an Order considered ? Give examples of differeij kinds of Orders What is a Due Bill ? Give examples of a Due Bill for Monej For Goods. What is a Promissory Note ? Give different forms of Notes. Whatij an Accommodation Note ? '^0. I," or, as soi G7 CHAPTER V. SHIPMENTS AND CONSIGNMENTS. The learner should carefully study and fix in his mind the following explanations Ion Shipments, before commencing the work ot Set V. Merchants having goods which they cannot dispose of to advantage at home, often ^end them to some person doing business in another place, by this means frequently hiding a better market. These transactions give rise to the above accounts. Consignor is a name sjiven to the shipper of goods or other property. Consignee is the person to whom the goods are shipped. " Shipment," as a ledger title, is a fictitious name given to merchandise, or other jroperty, shipped, to be sold on account and risk of the Consignor. It is made Dr. kvhen the goods are shipped, for their full value and for all charges ; it is credited with Its net proceeds, when the account of sales is received, by making the person to whom khe goods were shipped, or whatever he has remitted you in payment for it. Dr. to pe shipment. After the items have been posted to the ledger the account is |:losed "To" or "By Loss and Gain" If Account Sales has not been received, it is closed "By Balance Inventory," for what it was invoiced at and charged with when [he shipment was made. " Consignment," as a ledger title, is a name by which you keep an account with ^oods or other property received by you to sell on account and risk of the consignor. It is debited for all charges paid by you when received, and for all costs accruing bn the same while in your possession, and credited for all its incomes and sales. It [s closed by making it Dr. to your commission and to the consignor for his net proceeds, or to whatever you may remit him. In either case the account balances when posted in the ledger. The term " shipment," when used as a ledger title, should have the consignee's bame or place of residence attached, and each one should be numbered, in order that [ou may distinguish between different shipments to the same person oi place. " Consignment," when used as a ledger title, should have the consignor's name [ireiixed, and each one should be numbered. Thus, — If you ship goods to Joseph McKay, of Montreal, to be sold on your [ccount and risk, your ledger title should be "Shipment to McKay No. i," or [Shipment to Montreal No. i," and his ledger title should be "Student's Consignment ^0, I," or, as some merchants term it, "Student's Sales No. i." 4 c. Mil — 68 EXERCISES IN JOURNALIZING SHIPMENTS AND CONSIGNMENTS, Transactions. (i) Adams shipped to Benson, to be sold on his own account, loo iibls. Flour, valued at (2) IJenson on receipt of Hour pays ij^K, for freight, by check. (3) Benson sells the goods at 12^ per cent, advance, and receives in settlement note at I month for one half and check for balance. (4) Benson renders an Account Sales, his un- posted charges being as follows : Insur- ance .*i3, Storage §5.50, Cooperage §2.30, Commission 5 per cent., and remits net proceeds by draft on Bank of Montreal for which he pays cash. (5) Adams receives Account Sales with draft on Bank of Montreal, 5!562.oi, Journal Entries, (i) Shipment to Benson, Dr. To Mdse. (2) Adams' Con., Dr. To Bank (3) Bills Recuvable, Dr. Cash Dr. To Adams' Con. (4) Adams' Con., Dr. To Chargts " Commission " Cash (S) Cash Dr, To Shipment to Benson SSS50.00 5So.oo| 15.00 ij.ool 309. 3^*^ 309-37 618 7j| 603.75 10. Sol 30 9J 562.01I 562.01 562,011 Remarks on \st ttansaction. — If Adams had paid say §16 freight, insurance, or other charges uii| the shipment, his Journal entry would have been : Shipment to Benson, Da'. To Mdse. " Cash [or Bank] .^566.00 $5 seal i6.ccl Revtarks on 2n(i transaction. — If Benson on receipt of Consignment had paid no charges, !itl would simply have made a memorandum, but no Journal entry, as there would have been no accoun.l affected. He takes no responsibility more than the safe care of the goods until he begins to makel sales from them. Remarks on yd transaction. — The individual purchasing, or the account representing the thinJ received for the whole or any portion of a Consignment, is made Dr, to the Consignment. Remarks on i,th transaction. — The method of making out Account Sales is shown in an examplij at page 60, In making the Account Sales entry, tirst find what the total sales amount to, then the touj charges incurred while in your care, and by deducting the total charges from the total sales, you obtaiJ the amount which you are to remit the shipper, or credit him with. The " Charges account " is a representative account opened to show income from such sources al the charge made for insuring the Consignment against fire while in your possession (your genera] policy covering the contents of your warehouse), the charge made for storing it, and the charge niadj for the time spent by your men in coopering the barrels. The "Commission" account is of the same natu; . opened to show income from commissioJ charged for selling goods. Remarks on t^th transaction. — If the Account Sales had been received without a remittance of anl kind, Adams' entry would have been : IS— Received Casl Ig-Sold f. W, Ci Cash sales this Benson, Dr. . . $562.01 To Shipment to Benson I562.01 Note. — To underst.and the result of the aliove entries, open a ledger account on a piere of paper with " Shipmi:iii : Uenson," and post the entries afTectinji it, and you will find the gain upon the venture $12.01 ; then open an acsoiuit wi| "Adams' Consignment," and post the entries affecting it, and you will find that the account closes itself. ■ own name. G9 VIENTS, SET V. BOOT AND SHOE BUSINESS. 550.00 55o<» Jthe Cash Book should ije used in I'ERroR.MiNc; thk v'Ork ov this set. Ske tor.m at the 15.00 ■ END OF Set. -g HciiAKACTERlSTlcs. — Buying ail J SeUtiig for Cas/i, on Notes and on personal aicoimt ; Skipping to be 309.37 618 7il ■ii'Hh increased Capital. Kingston, April ist, 1S94. sold on account of the Shipper ; Commencing with a N^et Capital, effecting a net gain and closing -this day commences business with the following resources and i.iahii.ities. 603.75 , lo.ScI 30 9 J 562.oi^iKSOURCES,— Cash as per C. B. $3,850 ; Thomas IloUlen's Note, dated Dec. 9th, 1S93, at 4 months, 500; an accepted Draft drawn by A. M. Foster on John Templeton, dated Feb. i, at 60 days' ^62.01 B'R'^'' ^"^^ accepted Feb. 4, $400 ; A. L. Bogart's Note for $250, dated Jan, 14, at 3 months, with 562,oiBnterest at 8 per cent. Interest accrued on above Note $4.22; J. \V. Campion owes on account .^450; \V. Yeomans owes on account $375. — Total Resources, .S5, 829.22. Liahilities, — Am owing er charges uii^„ note, favor of F. Lockett, J325, dated Dec. 9, 1S93, at four months; Ames, llolden & Co., Mon- real, on account, $175; F. M. Clark, on account, !?220. Total Liahimties, !?720. ;66.oo $55o.a| i6,oc| 2— Bought of Haines & Lockett, on my notes, for equal amounts, at i, 2 and 3 months. Merchandise as per invoice .§5,100. " Bought of Ames, Holden & Co., on account. Merchandise, as per invoice, §3,500. charges, «,, p^jj q^^ j-^^ ^ ^^^ ^j- y^oks for store, .§12.50. For freight, .SS.25. Total, .§20.75. Cash sales en no account //,/, ,/«j,, $54 50. igins to makJ ing the thinl an examplJ hen the told es, you obtail uch sources ail your genetil charge niadl n commissici ittance of an| 2.01 4— Sold L. W. Yeomans, on account, i pr. Calf Stitched Boots, .§6.50 ; i pr. Misses' Goat Laced Boots, .$2.40 ; I pr. kid Slippers, .$1.25. Total, .§10.15. ^"'^■*'''' .f*^''-*" ''■^'"" '^"Xi ^ZO.So, jG— Paid F. M, Clark, Cash on account, $150. Paid for Advertising, $15.75. Accepted Ame.'--, Holden & Co.'s Draft at 10 days' sight, favor Thomas Smith, for $400. Received from J. \V. Campion, Cash on account, §250. Cash sales this day, .§85 40, IS— Received Cash for J. Templeton's draft of Feb. 4th, .§400. Cash sales this day, $95. Ig-.Sold J. W. Campion, Belleville, on account : — 5 cases, 60 pairs, Men's Stout Boots .... .... 6 " 72 " Men's Lasting Gaiters ... ... 8 " 96 " Youths' Stout Boots .. . 4 " 240 " •' " Brog.ins .... ... .... 4 " 240 " Woman's Split Boots .... 2 " 120 " " Congress Gaiters .... .... 2 " 120 " Pebbled Buflf Bals Cash sales this day, %\.\ 5.40. Total .... .... .... at §2.20 .§132.00 " 1.75 126.00 " 1.80 172.80 60 144,00 " 1. 10 264.00 " 1.25 150,00 " 1.25 150.00 .§1138.80 .h "Shipment: an actounl wil p— Bought for cash lo shares of the Capital Stock of the Ontario Transportation Co. at the par value $50, $500. I— Shipped per Steamer " Passport," and consigned to VV. T. Tilley, Port Hope, Ont., to be sold on my account and risk ; 10 sides No. i Sole Leather, " Hemlock Spanish," 240 lbs. at 25c.; i roll No. I Buffalo Sole, 300 lbs. at 22c.; 2 rolls Pebbled Cow, 280 feet at 15c. Total, §168 ; paid freight on same in casli, $10.50. ' Vour own name. c: ili.U(«» 70 12— * Renewed Thomas Holden's note for $500, due this day, for 2 months; interest on renewal, $6. 14. Cas/i sales this day, $114. 70. 13— Sold L. W. Yeomans, on account, i pair Misses' Calf Stitched Boots at $2.75 ; i pair do. Last- ing Gaiter Boots, $1.75. Total, $4-5o- " Redeemed my note of December 9, favor of F. Lockett, by giving him draft at 30 days on J. VV. | Campion, $325. Cash sales, $124. 14 — Sold John Mansard, Brockville : — JilSCS 60 jail " Sewed 6 360 Women's Calf Lace " I 60 (( Goat Buskins I 60 (( " Lace Boots . 2 120 (( Colored Gaiters . 2 120 (( Prunella Bals. at $5.00 " 4.C0 " 1.25 " 1.20 " 1.25 '♦ 1. 10 " 1.25 Total ifOOG.OO 240.00 450,00 72.00 j 7S« 132.00 1 1 50.00 1 M7190UI Received in settlement, his notes, one at 30 days for $475 " 60 " 544. " 90 " 700. 16 — t Received Dividend at the rate of 10 per cent, on stock held in the Ontario Transportation Co., $50. Cash sales this day, $125.75. 17— Received from A. L. Bogart, cash in full for his note of Jan. 14th, and interest thereon to date; face of note, $250 ; interest for 93 days, at 8 per cent., $5. 10. Cash sales, $1 18.25. 18 — Paid Ames, Holden & Co., cash on account, $500. Paid the following items of expense : Paint- ing Shop, $35. Repairing Windows, $140. Cleaning Store, $4.50. Total, $179.50. C(d sales this d^y, $125.50. 20 — Paid AmeF, Holden & Co.'s Draft of the 6th inst., favor T. Smith, $400. Cash sales, $136.20, 22 — Bought of Jno. McKeown, for cash, Merchandise, as per invoice, $1,200. " Received from L. W. Veomans, Sight Daft on John Smith, for $835.15. " Bought of Thomas Brown for John Mansard's note of April 14th, Merchandise, $700. dm sales, $175.50. 23— Received from W. T. Tilley, Port Hope, on account of sales of the Leather shipped him the iitk inst. The net proceeds, which have been entered to my credit, amount to $211.50. Paid F.M, Clark, cash in full of account, $70. 24 — Paid Ames, Holden & Co., cash on acct., $200. Paid sundry expenses, $15.50. 30--Paid Rent, $100. Clerk's salary, $140. Gave Ames, Holden & Co., Draft at 30 days on W.T. Tilley for $211.50. Merchandise unsold as per Inventory, $9173.25. Shares in Ont. Trans. Co., $500. Net capital at commencing, $5109.22. Net gain, $2673.22. Net worth at closing, $7782.44. When making out the Loss and Gain Statement of this set, show the dividend ($50.00) on O. T C. Shares under the head of Gains, and in the Resource and Liability Statement show the value o;| the shares ($500) under the head of Resources. Close this account to Loss and Gain for the $50, am By Balance for the $500. TO THE STUDENT From the above Day-Book you are required to make out the following business papers, using for the same such names and amounts as would be required in a horn fide business. The Cash at W finding the di( All necessary forms of N'otes, Drafts, etc., may be found in the foregoing Chap kJ comoarine \\ See mode of filing business papers, page 73. Draw the three notes received on the 14th, the Draft paid on the 20th, and thi Draft received on the 22nd. ter. day. NoTK, — When notes, drafts, or other ohligations fall due on Sunday, payment is not required hy law until the nei * Under the head of " Entries for Renewals of Notes," you will learn how to make this Journal entry. \ See note at foot of second page from this for an explanation of Dividend. hen the Cash B renewal, | do. Last- on J. W. $600.00 1 240.00 1 450.00 1 72.001 75a| 132.00I 1 50.00 1 $171900! tati'jn Co., on to date;! ;nse : Paint- J. 50. Cas!\ ;s, $136.20,1 1700. Cas'rM him the iitkl Paid F.M. lys on W.T, ,44. )) on O. T,| Ithe value the $50, ami [g business in a /'oihi CASH BOOK. This book is kept for the ))urpose of recording all Cash received and paid. Ilhereare various ways of keeping the Cash Book (see forms for Sets IX and XI), 3Ut the following form is perhaps as simple as any for beginners, and is sometimes ised by persons whose Cash transactions are not very numerous, and who are not Scientific accountants. It contains two columns for dollars and cents.* Whenever money is received from any source whatever, it must be entered in [his book " To " (describing for what), and the amount be extended into the /e/i hand dollar and cent column, which is called the de/u't column ; and whenever money is paid out for any purpose whatever, it must be entered in this book " By " (telling jvhat for), and the amount extended into the rig/it hand dollar and cent column, called Ihe credit column. If the account is kept correctly, the difference between these two plumns will show at all times the balance of Cash in hand, and will a^ree with the [dual amount of money found in possession by counting. Any discrepancy must Irise from error, which must be sought out and rectified before the account is bal- anced. The credit column can never be the larger, since it is impossible to pay out (lore money than you receive. The Cash Book should be balanced at the end of each week (or daily when much lusiness is done), by entering the balance of Cash in hand in the credit column, in \d ink, to distinguish it from sums paid away. After footing the columns and draw- tig the lines, bring the balance down, in black ink, entering it in the debit column. [he lines should be ruled exactly as in the form. They serve to keep the new ccount distinctly separated from the old ; a matter of greater importance than young lookkeepers generally imagine. It adds greatly to the appearance of your book to legin the words " To " and " By " all upon a perpendicular line. Leave a space be- veen the name of the account and the explanation, and begin the latter on a uniform ine, Note example. Ih, and thtB The Cash account may be tested at any time, without balancing the Cash Book, finding the difference between the debit and credit columns, on a scrap of paper, )ing ChapBid comparing the difference with the Cash in hand. Th. should be done daily |hen the Cash Book is balanced only once a week, as in the following form : • until the neil * The student will observe that in speaking of the money columns we designate the space for dollars and the space for hts, united, as but one column. 72 CASH B(10K— SET V. Dr. Cr. 1 894 April I To Stock, Amount invested. 3850 4 k 2 By Expense, Ace. Books,Si2 50. Freight, 8 25 20 75 (( it To Merchandise, S.iles this (lay. 54 50 (( 4 " Merchandise, Sales this day, 70 80 6 * Baliince in hand. Balance brought down. 3975 3? S5 •3954 55 3975 30 (( 3954 it i( By F. M. Clarke, Paid on Account, 150 (( (4 " Expense, To J. w. Campion, " Merchandise, Paid for Advertising '5 75 (( i( Received on Account, 250 t( (( Cash Sales, 85 40 (( 8 " Bills Receivable, Rec. forTempleton'sDraft,B.B. 4CX) (( ik " Merchandise, Sales this day. 95 t( 9 " Merchandise, Received for this day's sales, "5 40 t ( lO By 0. T. Co. Shares, Bought 10 shares at par. 500 (( II " Ship't to Tilley, Paid Freight, 10 50 (( (( To Merchandise. Received for day's sales, 114 70 «3 * Balance in hand. Balance brought down, SOI 5 5 80 •4338 80 5015 0; (( 4338 (( 44 To Merchandise, Received for sales this day, 124 (( i6 " Merchandise, Sales this day, 125 75 (( 44 " 0. T. Co. Shares, tAnn'ldivi'dattherateof lop.c. 50 (( '7 " Bills Receivable, Received for Bogart's note, B. B. 250 U 44 " Interest, Received on above note, 5 10 (( 44 " Merchandise, Received for day's sales, 118 25 (( 18 By Ames,Holden &; Co ,,Paid on Account, 500 (( 4 4 " Expense, Painting, repairing and cleaning >79 jc t t To Merchandise, Sales this day, 125 50 20 * Balance in hand. Balance brought down, 40 90 *44S7 9C S137 5137 4c (( 4457 (( 44 By Bills Payable, Anies.IIolden&Co.'sdraftof 6th 400 a (( 44 To Merchandise, Cash Sales, 136 20 (( 22 By Merchandise, Bought of John McKeown, 1200 a ( t 4 t To L. W. Yeomans, Sight Draft on ]. Smith, 835 15 (( (4 " Merchandise, Sales this day, '75 so (( 23 By F. M. Clarke, In full of Account, 70 a (( 24 " Ames,Holden&;Co ,0n Account, 200 a ti 44 " Expense, Sundry Items, «S J (( 30 i( >> Rent, $100 ; Clerk's salary, $140 240 a * Balance in hand, 5604 75 *3479 2 5604 ; * Red Ink. I This dividend might be credited at once to Loss and Gain, but it is better to show it through another account lid We here credit it to the acct. representing the investment, but you must be carerul when closing your books to writel from this acct. into Loss and Gain before balancing the Shares acct., otherwise you would show in this acct., a. decrea>(j resource. Another way of dealing with dividend is to open a " Dividend acct." and credit it with the amount, and whij closing the books write it into Loss and Gain. 78 FILING BUSINESS PAPERS. The following forms represent Business Papers properly folded and filed. As the folding and filing of other papers, not represented here, should be after the same general form, we deem it unnecessary to give them. Fold all papers the same width, ;^ of a page of foolscap. p • 00- ^3 1 i^ - Bills of Mdse. for May, 1894. p s-^rt^ 4* (n * Acct. Sales for January, 1894. S. G. Beatty, Acc't. of Sales, Jan. i8th, 1894. $250.20. * Jnvoices for January, 1894. Thos. Smith, Invoice Jan. 14th, 1894, $124.50. c 1| Trial BalamtSt 1894. 1 Trial Balance, Set I Taken, Bellev'le Jan. 3 1st, 1894, A. R. Brown, Acc'nt. 1 74 SET VI. PRODUCE AND COMMISSION BUSINESS— Single Proprietok. Books Used.— Day Book, Journal, Lrdgek, Bill Book and Cash Book. Characteristics, — This and the ntccceding Set are intended to illustrate the principles and practice of a simple commission, in connection loith a general merchandise business ; as also to some extent the giving and receiving of notes, drawing and accepting drafts, with alloivance oj interest and discount ; keeping a bank account in the Ledger, draxving and receiving cheques, etc., etc. This Sel illustrates the business of a single Proprietor, closing with a net loss, and arranging to admit a partner, for the continuance of the business, in Set VII. Instead u^ ck in the Ledger use your own name and the word Capital after it. St. John, N. B., January ist, 1894. Student invests in Cash $5000. * Paid Casli for Office Furniture $350, and for Books & Stationery $50. Total $400. 2— Deposited in the Montreal Bank $4000. 3— Bought of W. Lingham, on my Acceptance at 10 days, loo bbls. Extra Flour at $6.75, $675; 100 do. Superfine Flour at $8.25, $825. Total $1500. 4 — fPaid for three months' Rent in advance, per Cheque, $375. Received from Jones ft Co., Hamilton, to be sold on their account and risk, 200 bbls. Extra Flour; paid Freight and Drayage | on same, per Cheque, $213.50. 5 — Sold for Cash, from Jones & Co.'s Consignment No. i, 100 bbls. Flour at $5.70, $570. Soldi W. B. Robinson, on account, 75 bbls. Superfine Flour at $9, $675. 6— :|:Took out Policy of Insurance on Warehouse and contents for $30,000 at )i per cent.; paid | Premium, per Cheque. $225. Sold for cash, 50 bbls. Extra Flour at $7,00, $350; 25 do. Super- fine Flour at $9, $225. Total 1575. Deposited in Bank $1000. 8 — Received from Jones & Co., Hamilton, their second Consignment, consisting of 1 00 bbls. New I Mess Pork; paid Freight and Drayage on same, per Cheque, $247.50. Sold J. Cummings on his Note at 30 days, from Jones & Co.'s Consignment No. i, lOO bbls. Flour at $5 75, $575. 9 — Rendered Jones & Co. Account of Sales of Flour, represented in "Consignment No. i," Mjl charges on same are as follows : — Storage, Insurance, Cooperage, etc., $21,43; II Commissivon 2\\ per cent, on Sales, §28.62; Jones & Co.'s net proceeds $881.45. Total debit to Jones &* Co^i\ Consignment No. i, $931.50. 10— Sold from Jones & Co.'s Consignment No. 2, 75 bbls. Pork at $20, $1500 ; received in paymenj Sight Draft on James Wilson & Co, for $800; § Cash $700. Deposited in Bank $2000. II— Accepted Jones & Co's Draft at 10 days' sight, favor of W. H. Davy for $500. 12— Received from W. West, Toronto, to be sold on his account and risk, 3325 bush. Wheat ; paiii| Freight and Drayage on same, per Cheque, $175. 13— Sold from W. West's Consignment No. i, for Cash, 1625 bush. Wheat at $1.00, $1625. 15 — Received from Jones & Co., Hamilton, their third Consignment, consisting of 1000 bush. Rye,| 500 bush. Oats ; paid Freight and Drayage on same, per Cheque, $180. ij—Sold from Jones & Co.'s Consignment No. 2 to H. Holden, on account, 25 bbls. Pork at $21 ;| $525- 16 — Closed Jones & Co.'s Consignment No. 2, and rendered Account Sales of same ; my charges foil Storage, Cooperage, etc., $19.78; Commission 2>^ percent, on Sales, $50.62; Jones & Co.'i| Net Proceeds, $1707. 10, Total debit to Jones dr» Co.'s Consignment No. 2, $1777.50. 17 — Received from W. West, Toronto, his second Consignme.it, consisting of 4725 bush. Canadiaii| Club Wheat ; paid Freight and Drayage, per Cheque, $325. i8-Sold W. 70c., 3 $3, $1 20— Received Flour j 21— Paid my $1,500 $',502, 20th, d 23— Received 24— Paid my a $1,875. I^ Merchandi $1,100. Total unexpired polic Net loss, $ Note V l)y such accour See Index. Having j on next page, you have take usual way, ex( resources and follows, becau If an ace the balance 01 closed " By I dating the bal \ffesources anc I commence met Before pc I which have be properly mad( liabilities in th * Open an Oflfice Furniture account for this, and charge Books and Stationery to expense, t Open a Rent accouKj for this. } Open an Insurance account for this. II A general " Cliarges" account is sufficient to represent the returns from all charges except your Commission, \vliid| requires a separate account. g The distinction between a Sight Draft on a person and a Cheque is that the former is drawn on an indiviclua] and the latter on a bank. Both being payable on presentment are considered the same as Cash. As this draft wil placed in the bank for collection we shall reckon it as Cash at once. I As Interest anc tne amount paid or r ■Notes and Entries" •iMeptance in having acceptor. See " Pro t You may leave iwinta and credits on J 'Among the op« I -No- 2, and Jones &• ( ■an excess of the debi I'nis statement precis J II The value of lamong our resources. Ithem as we do invent If-'tiection will show v Iwould deal with, say 75 11. (/ practice me I'Xiciil terest and This Sd ) ailtnii a use your $675; 100 ties ft Co., nd Drayage ;57o. Sold cent,; paid 5 do. Super- o bbls. New | nings on his !575- o. I," My I mmission 2^ I les (St* Co,''\ 00. in payment I 3. heat ; paiii| 18— Sold W. B. Robinson, on account, from Jones & Co's Consignment No. 3, 1000 bush. Rye at 70c., $700. Bought of John Downing, on my note at 30 days, 400 bush. Timothy Seed at $3, $1,200. 20— Received from Jones & Co., Hamilton, their fourth Consignment, consisting of 227 bbls. Extra Flour ; paid Fcight and Drayage on same, per Cheque, $425. Deposited in Bank, $1000. 21— Paid my acceptance, favor of W, Lingham, due the 16th, per Cheque; face of Acceptance $1,500; Interest on same, five days, $1.23; *and protest charges $1.04. Amount paid $1,502.27. Paid before maturity my Note favor of John Downing for $1,200 due F'el)ruary 20th, discount off, 30 days, .^6.90. *Net amount paid per Cheque, $1,193.10. 23— Received from W. B. Robinson, cash in full acct. 1 24— Paid my acceptance favor of W. H. Davy, due this day, per Checjue, $500. Deposited in Bank $i,87S. INVENTORY OF RESOURCES NOT SHOWN ON THE LEDGER.^ Merchandise: 50 bbls. Extra Flour at $6,?5, $337.50. 400 bush. Timothy .Seed at $2.75, $1,100. Total, $1,437.50. WRent, two months paid in advance, $250; Insurance, 11 months' unexpired policy, $206.25 ; Furniture valued at $350. Net loss, $81.17. Note. — What should be done at the time of closing the books, when the property represented by such accounts as Furniture has depreciated, will be learned under the head of Plant Account. See Index. TO THE STUDENT. Having journalized and posted this Set, take off a combined statement as given on next page. This statement combines the trial balance and two statements that you have taken separately in previous sets ; you will then close the accounts in the usual way, except that instead of transferring the balances of the accounts that show resources and liabilities into a Balance acct., you will bring down those balances as follows, because the accounts are to be continued in the next set. If an account is closed " To Balance," bring down imder the footing and ruling the balance on the credit side of the same '•' By Balance ; " and if an account is i closed *' By Balance," bring down the balance on the debit side *' To Balance," dating the balance brought down. When all the balances are thus brought down, the \ Resources and Liabilities will be correctly located in the Ledger ready for the commencement and continuation of Set VII. See the foot note at page 42. • c : 525. ■ Before posting Set VII., take a Trial Balance of those accounts the balances of bush. Rye-B which have been brought down in the Ledger, to ascertain if the transfers have been properly made : or compare the balances brought down with the resources and ork at §2' '■liabilities in the statement, with which they should agree. y charges foil ones & Co.il 3. I sh. Canadiul a Rent accounJ mission, whi'l )n an indlvidu this draft will I'j *As Interest and Discount are the same in nature and effect, both representing tlie use of money, and both indicating I the amount paid or received for its use, we do not deem it necessary to keep two separate accounts. See " Discounting I Notes and Entries " for full explanation. The protest charges is the amount of expense incurred by the holder of the lacceptance in having it protested for non-payment by a Notary Public, and which he (the holder) collects from the |.icceptor. See " Protests " for full explanation. t Vou may leave this amount blank until you have posted thus far, then refer to the Ledger for amount, or take the Idebits and credits on a piece of paper from the day book, and ascertain what amount he owes you. J Among the open Ledger accounts are W. West's Consg't. No. i, Jones & Co's. Consg't. No. 3, West's Consg't. IN'o. 2, and Jones Si Co.'s Consg't. No. 4 ; the former two of which show an excess of the credit side, and the latter two Ian excess of the debit side. As the business for which these accounts were opened is not concluded, they are treated in jlhis statement precisely like persric-\ 'Iter, Jaimi\ iKnvn in h>' ts Fenwick, I conducted I bss, and the [eposited in I lent, No. 1,1 Indered him | Commission, \ent No. 1,1 l-p.irtnership, of the book) I A firm naiwl to-day, .Till I 4— BouRht of S. White k Co., 8 hhds. Muscovado Sugar, 13,850 ll)s., at io|jC., 81454.25 ; gave them our .Sight Draft, on IT. ilolden, for amount of hi- acct. ij? * Choiue for l)aIanco, * . 5— Paid Jones & Co.'s demand draft on us, per Cheque, §1500. 7— Sold James Jennings, on his Note at I month, 4 hhds. Muscovado Sugar, 6930 lbs., at lie, I3S762.30. 8— Sold for Cash. 50 bbls. Extra Flour at S7.50, $375. I'aid Cash for Postage Stamps and Stationery !j!lo. 10— Received Cash in full for J. Cumming's Note of Jan. Slh, due this day, !? Deposited in Bank, Cash §90*1. 12— Sold for Cash, 41x3 bushels Timothy Seed at .i?3. 50, .S1400. 15— Sold for Cash, from Jones & Co.'s Consignment No. 3, 500 bush. Oats at 39c., .'ii'195. Closed Jones & Co 's Consignment No. 3, and rendered an account of the same. Our charges for Storage, Insurance, etc., amount to $13.87 ; Commission, .S22. 37 ; Jones & Co.'s Net proceeds, .$678,76. Total Debit to Jones ct Co.''s Consignment I^o. 3, !ji!7i5. 16— Paid W. West's Sight Draft on us, favor Montreal Bank, per Cherpie, .S2500. 18— Sold Solomon Johns, on acct., from W. West's Consignment No. 2, 3525 bush. Canadian Club Wheat, at §1.00, S3525 ; also, from Jones & Co.'s Consignment No. 4, 227 bbls, Flour at •Sio, .?227o. Total, .ii!S79S. 19 -Closed Jones & Co.'s Consignment No. 4, and rciiilered an Account Sales of the same. Our charges for Storage, Cooperage, etc., .?24.S9 ; our Commission, 856.75 ; Jones & Co.'s Net Proceeds, .?I763.66. Total Debit to Jones .0 Co.'s Consignment iVo. 4, 61845. 20— Sold for Cash, from W. West's Consignment No 2, 1200 bush. Canadian Club Wheat at .i?i.oo, .?I200. 21— Closed W, West's Consignment No. 2, and rendered Account Sales of the same. Our charges for Storage, Insurance, etc.. .^23. 17 ; Commission at 2^^ per cent., .S118. 12 ; W. West's Net Proceeds, ^4258. 71. Total Debit to West's Consignment, .i?4400. 24— Received Cash in full for George Wallbridge's Acceptance of the 3rd inst., face of Acceptance, .?l70o ; interest on same, 8 days, $2.24 ; amount received, $1702.24. 25— Received Cash, less discount, for James Jennings' Note of the 7th inst., due March loth ; face of note, $762.30; discount, $2.17; net amount received, $760.13. Deposited in Bank, $4500. 1 27— Received of Solomon Johns, Cheque in full of his acct. $ 1 Deposited in Bank, $6ooo. 1 28— We have this day arranged with Smith & Moore, for the sale to them of our entire business, including Furniture, Good Will, etc., possession to be given March ist. Received their Note at 3 months, for the following considerations and amounts : One month's prepaid rent $125. Ten months' unexpired Policy of $30,000, on store and contents, $187.50 ; Furniture, $300 ; J Good Will, $2000 ; Total, $2612.50. hS— Accepted W. West's Draft at ten days, for balance of his acct., $ ** Sold for Cash, 4 hhds. Muscovado Sugar, 6920 lbs., at I2c., $830.40. Paid Jones & Co 's Sight Draft, per Cheque, for balance of their acct., $ * Deposited in Bank, $2711.60. Total net gain, $26 37. 1 7. The following business papers are required to be made out by the Student from ^ET.s VI and VII. From Set VI, — Receipt for rent, paid Jan. 4th. Note received from J. ^ummings Jan. 8th. Account of Sales rendered Jones & Co., Jan. 9th. From Set VII. — Geo. Wallbridge's acceptance of February 3rd. Sight Draft l^eceived from W. West, Feb. i6th. Account of Sales rendered W. West, Feb. 21st. ' Refer to Ledger for amount of these accoiint.s. t See balance of Solomon Johns' account in Ledger. t The Good Will means the bonus paid for the privilege of securing an established business, or.e that is well knowti li:d possesses liberal patronage. 78 SINGLE ENTRY. Exemplified in a partnership fit/si/iess, concludinj:^ with an illustration of the part- nership settlement ; presenting;;, also, a practical illustration of the process oj changing a set of books from Single to Double Entry. Considerable space has been devoted to the following Set, in order that the Student may become thoroughly conversant with Single as well as Double Entry. The authors are not among those who condemn Single Entry as wholly inadequate to I the demands of business and unworthy of consideration. To a person who| understands and appreciates the advantages of Double Entry, no further illustration than this Set afibrds, will be necessary to show its superiority over the other system, But as there is a large class of dealers, who, for various reasons, are not inclined to keep th';:ir accounts by Double Entry, it will be serviceable and acceptable i;o every account! nt to understand both systems. The principles of Single Entry are so easy of comprehension as scarcely to ntdl explanation. Accounts are kept only with the persons with whom you have dealings; and although a Cash account, Merchandise account, and other Property accounts may be kept in the Ledger, yet just so far as you introduce any other accounts except those with persons who owe you or whom you owe, so far do I you encroach upon the peculiar province of Double Entry. The principal books oij Entry are a Day Book and Ledger. Besides these we introduce the Cash Book and Bill Book, as they are veryl important books, and should never be dispensed with in a business where there arel any considerable dealings in Cash or Notes. These auxiliary books are kept in the same manner as in Double Entry. All transactions which requite a debit or credit to any person with whom you harX dealings, are entered tn the Day Book ; and as this is the only book from tvhich you postX every entry which you wish to bring in^'o any account in the Ledger must be entert\ here. An entry may be required in another book as well as the Day Book for tranX actions with persons ; for instance, if a man pays you money on account, or you /(i; money on account, it will be entered in the Cash Book ; likeivise if you receive a note o\ account or give one, an entry must be made in the Bill Book. When entering purchases it is allowable to say, " Amount as per Bill," oJ " Amount as per Invoice," and omit the details of items, since you have the invoiciT filed away, or pasted in a book, so that you can refer to it at any time ; but in enterina sales on account, the items should always be mentioned in the entry, whether youi books are kept by Sine:le or Double Entry, as this is your legal evidence of tha transaction ; and in order to be taken as evidence, each article must be distinctly named. See Form of Single Entry Day Book, at the end of this Set, page 8il Note. — The same transactions that are given in the 8th set to be done by single entry, are given in the first month :| the loth set to be done by double entry. Thus the student has the opportunity of thoroughly understanding aT contrasting the two systems. Besides comparing the two ledgers, take the statements at the end of each and observe ill two methods of determining the gain, and arriving at the same result. You will find further on, in that part of the boc| devoted to Expert Accounting, this subject enlarged upon in a very practical way. T0 SET VIII. DRY GOODS BUSINESS. TWO PARTNERS. The wi/ik of this Set is to he done by SinRlc Entry, BccordinR to form on pajje 8i. London, March 1st, 1S94. J. S. Mili.kk and F. Lank this day commence the Dry (Joods business, at No. 114 St. James street ; agreeing to share gains and losses according to capital invested. J, S. Mli.UP.R invests :— Cash, Jjlisoo ; Merchandise, !j8cx) ; Note for !?6oo, favor J. S. M., made by Thomas Gibbard, dated January 31st, at 30 days ; an Accepted Draft for .'i!'4CKj, drawn by ]. Jones on D. Koblin, dated January 20th, at 90 days, lialance due from J. K. Marvin, !ji25. 'J\>tnl /in'cs(mcul,$i:^2l, V. Lane invests j— Cash, #1500 ; Merchandise, .^1200 ; Real Estate. ^700 ; Note against S. Fowlur for !ii!.joo, dated Janu- ary 2Sth, at 60 days ; Note agair.st IL Jackson for 15(800, dated November 2.5rd, 1S93, at 6 months, with interest at 7 per cent. Interest accrued on above Note to date, 98 days, .*i5.o3. Total Investment, .'ij<44 15.03, 2— Rought of W. McKay, on acct.. Invoice of Merchandise, amounting to ij?iSoo. Sold Robert Carey, on acct., 50 yds. Hlk, liroadcloth at %2.Z'^ ; 12 Fancy Neckties .it iijii each ; 15 doz. prs. Lisle Thread Stockings at !B3.2S per doz. J— Sold James Goodwin 50 yds. Flannel at 60c ; 25 yds. Broadcloth at !?3.7S ; 66 yds. Cassimere at !ji. 25 J received his draft at 10 days' sight on A. Jtenson for $55, the balance to remain on acct. 4— Bought of H. Simmons, Mdse., invoiced at .i?200 ; gave our Note, at 60 days, for .^loo; the balance to remain on acct. 5— Sold W. Harding, for Cash, 2 pes Irish Linen, 66 yards each, at 85c., 35 yards Broadcloth at %2. 50, 6— Sold W. Williams, for Note at 30 days, 2 pes. Blue Broaddt ih, 45 yards each, at •'^1.75 ; 90 yds. French Merino .at 60c. Received from Robert Carey his draft at sight on W. Johnson for .*!50. 8— Sold James Goodwin, on account, 90 yards Scotch Tweed at $1.25 ; 45 do. Red Flannel at 55c. Bought of W. Harding, for our Note at 20 days, 5 pieces English Prints, 40 yards each, at 25c. Sold Richard Manning, for his Draft at 10 days, 10 yards Bro.idcloth at $2.35; 15 yards Mixed Tweed at $1.50. 9— Received from James Goodwin his Sight Draft on John James for $85. Bought of Richard Watson, for Cash, Merchandise invoiced at .^200. II— Sold Henry Simmons 24 yards Brown Beaver at $3.25 ; received Cash, $40; balance on account. Bought of William McKay, Merchandise invoiced at $500 ; gave in payment Cash $350 ; balance to remain on acct. 12— Sold Robert Carey, on acct., 55 yards Blue Broadcloth at $1.75. Received from James Good- win Cash, $50 ; Cheque on Montreal Bank, $30. 13— Paid William McKay Cash, $1200. .Sold John Johnson, for his Sight Draft on J. Wilson, 15 pairs pants at $3.75. Sold Robert Carey on acct., 30 Vests at $2.25 ; 12 Ready-Made Coats at $5-50. 15— .Sold H. Simmons, on acct., 9 Fine Overcoats at $16. Sold John Cummings, for his Note at 20 days, 12 Complete Uniforms at $15. 1 16— Bought of A. Verm:',yea, for our Note at 30 days, Mdse. invoiced at $175. Received Cash for James Goodwin's Draft of the 3rd inst. Paid our Note of the 4th inst., favor of H. Simmons, less discount at 6 per cent., for unexpired time. 1 17— Received from Robert Carey, Cash, $100. Sold Tames Goodwin, on acct., 50 Summer Coats at $2.50. Bought of W. McKay, on 3 months' credi', Mdse. invoiced at $275. |i8-Received Cash in full for T. Gibbard's Note of Jan. 31st, with interest at 6 per cent., for time overdue, 13 days. Received Cash from H. Simmons, $40. :o— Sold W. Manning, for Cheque on Merchants' Bank, to Military Coats at $1 1 ; 10 pairs Pants at $6. Sold Robert Carey, on acct., 5 doz. Byron Collars at $2 per doz ; 4 doz. Cravats at $3 per doz. Received from James Goodwin Cheque on Montreal Bank for $155 |2i— Sold H. Simmons, on acct., 40 yards Blue Broadcloth at $1.80 ; 10 yds. Black Beaver at $3.75. Received Cash for R. Mann'ng's Draft of the 8th inst. Sold W. West for his Draft at 10 days on R. Bass, 50 yards French Cassimere at $3. Bought of W. McKay, on acct., Mdse. as per bill, amounting to $95. 123- Sold Robt. Carey, on acct., 10 Summer Coats at $2.50 ; 40 yds. Red Flannel at 55c. 80 24 — Gave W. McKay our Draft at lo days' sight on James Goodwin for $ioo. Sold H. Simmons, on acct., lo yards Broadcloth at $2 25 ; 6 doz. French Yoke Shirts at $18 per doz. Bought for Cash Mdse. as per bill, amounting to $300. Sold Tames Goodwin, on acct., 10 doz. Undershirts at $7 per doz.; 8 doz. pairs Knit Drawers at $8 per doz. 25 — Paid W. McKay's Sight Draft on us, favor W. Barnes, for $SCX). Received from Robt. Carey Sight Draft on James Goodwin for $125. 26 — Sold H. Simmons, on acct., i piece French Cassimere, 50 yds., at $1.25. " — Had H. Jackson's Note of Nov. 23rd, 1893, discounted at Merchant's Bank ; face of Note, $800 ; interest less discount at 7 per cent, for unexpired time, 6l days, $18.54 ; cash received $818,54.* 28 — Sold James Goodwin, 15 complete Uniforms at $14 ; received in payment Sight Draft on Montreal Bank, $50, balance to remain on account. 29— Gave W. McKay our Sight Draft on H. Simmons, $75. Bought for Cash, Mdse. as per bill, amounting to $400. Received Cash in full for S. Fowler's Note of January 25th. Paid Cash for Gas Bill, $20 ; Wood, $15 ; Rent, $50. 30— Received Cash for D. Roblin's Draft of January 20th, less discount for unexpired time at 7 per cent. Paid Shop hands Cash in full for services to dale, $120. A^^When you have made the entries in the Day Book, foot it and ascertain whether your footings are correct ; if they ire, post from Day Book to the Ledger (there is only one debit or one credit for each transacti,)n). Turn now to page 82 and study the instructions regarding changing from single to double entry, and then apply them to your own work. You must not begin the ninth set until the Ledger has been changed to double entry. Inventory — Merchandise unsold, $3800 ; Real Estate, $700. Total Net Gain, $425.24 ; J. S. Miller's share of Gain, $185.77 ; F. Lak'es share, $239.47. Test the shares for yourself. REMARKS ON THE DISTRIBUTION OF GAINS AND LOSSES IN PARTNERSHIPS. Although the gains and losses are in the above and subsequent sets divided according to capital invested, which is a common practice, and which appears at first an equitable arrangement, yet it may prove very unfair to the partner having the I smaller capital. In a Joint Stock Company, where the shareholders give no time tol the business, the principle is right, as there is simply an investment of money on their I part, but in a partnership there is the investment of time and skill as well. Thel following example will illustrate our meaning : Suppose A and B go into partnership;! A is wealthy, and invests $6000, but B, not possessing much capital, can only invest! $2000, and they agree that gains and losses shall be shared according to capital! invested, both giving equal tirr.e and skill to the business. They make a profit ofl $3000 ; according to the agreement A will receive $2250 and B only $750. Such a! distribution is manifestly wrong and unjust, as it recognizes only money as a factor in| securing the gain, whereas time and skill should also be reckoned. The correct principle upon which to arrange a partnership where there is an! unequal amount of capital invested by the partners, but an equal investment of tiinel and skill, is to allow each partner interest, say at 8 per cent., upon his investment, orl allow the partner having the larger investment interest upon the sum he has invested! in excess of the other, which amounts to the same thing, and then divide gains and! losses equally. Were this done in the above example, A would receive only $320 inl excess of B, instead of $1500, the $320 being a fair return for the use of his money,! the equal distribution with the other partner of the gains, after this sum for interest| is deducted, being for his time and skill. Inequality in skill or time would be adjusted by the one partner paying the otherl a sum to be agreed upon. At the end of the year an entry, debiting the one and| crediting the other, will be made, and then gains and losses will be shared equally. * It is tl'C custom of Banks, when a Note bearing interest is di.scounted, to compute the interest for the full time 0:1 the face of the Note, and add it to the Principal, then discount the amount. In this cise, Jackson's Note bears intcic-l at 7 per cent, fnr 184 d:iys, und will amount, when paid, to $828.23. The discount on this amount for the 61 days ikl Note has to run before it comes due, at 7 per cent., is $9.69, and this deducted from $828.23 leaves $818.54, the mil proceeds received from the Bank, L. F. 57 58 J: liusi acco J- F. 120 4« 29 39 45 29 .Note.— The .sales for in full at the time < Tiook. * This debt of Mai |i to Marvin from the 1 T'arvm. 81 EXAMPLE OF SINGLE ENTRY— Set VIIL London, Marc/i 1st, 1S94. he full tinir or.] : bears intcic-| he 61 days ik\ 818.54, thcntj L. F. 57 58 120 41 29 39 45 29 J. S. Miller and F. Lane this day commence the Dry Goods business, investing, and agreeing to share liie gains and losses, according to articles of co-partnership. Millers' investment. S, Miller, Cr. For the following investment : Cash as per Cash Book, .... .... Mdse. as per Inventory, .... .... Note and Acceptance as per Bill Book. Balance due from J, R. Marvin, .... Lane's investment. F. Lane, Cr. For investment as folio ws : Cash as per Cash Book, .... Mdse as per Inventory, .... Real Estate, Lot Mountain .St., Notes as per Bill Book, .... Interest on 11. |ackson's note, * J. R. Marvin, To Balance favor J. S. Miller, Dr. I '.500 i Soo ] 1000 125 W. McKay, By Mdse., as per Invoice No, i. Cr. Robert Carey, Dr. To 50 yds. Black Broadcloth at ... §2 25 " 12 Fancy Neckties ** ... .... i 00 "15 dozen prs. Lisle Thread Stockings at ... 3 25 James Goodwin, To 50 yds. Flannel at " 25 " Broadcloth at "66 " Cassimere at -Cr. Dr. .$0 60 • 3 75 • I 25 By Draft at 10 days, on A. Benson, 4 H. Simmons, By Merchandise, as per Invoice No. 2 Dr. To our Note at 60 days for .... Cr. Robert Carey, By Draft at sight on W. Johnson, Cr. 1500 1200 700 1000 15 112 i:: 48 30 93 82 03 50 00 75 75 50 3425 44'5 '25 1800 03 »73 206 55 200 ICX3 SO 25 Note.— The sales of the jth and 6th arc merely entered in the Cash Hook and Hill Hook. As the Roods /ere jKiid [or in full at the time of purchase, no personal account is affected, and consequently, no entry is re(iuired in the Day Tiook. * This debt of Marvin's forms part of Miller's investment, but as this is Single Kntry Hookkeeping you cannot debit It to Marvin from the entry in which .Miller is credited with it, consequently, you make a separate entry in order to debit ^larvin. c: 82 CHANGING SINGLE TO DOUBLE ENTRY. Having finished the posting of this Set, according to the principles of Singlel Entry, you will now proceed to change the books to Double Entry. You have learnedl from the Sets already worked out, that Double Entry comprises di perfect and continual record of. Resources and Liabilities ; and by examining the Ledger of the last Set asl it now stands, you will find that Single Entry comprises an impetfcct record oil Resources and Liabilities ; or a record of only a portion of them, viz., personal! accounts. Whenever this deficiency is supijlied, the requisites of Double Entry art:| met. Therefore, TO CONVERT SINGLE ENTRY BOOKS TO DOUBLE ENTRY, FOLLOW THIS RULE. Carry the net gain or loss of the business to Stockier the Proprietors' accounts, thaX open such additional accounts in the Ledger (7vith their respective amounts) as arX necessary to make it exhibit the entire Resources and Liabilities of the concern* It will be necessary, in order to eflect the desired change, to ascertain the ntll wo.ih, then the gain or loss. This is done by making out a statement of Resourctsl and Liabilities ; then, if no new capital has been invested, or any withdrawn, Inj t.iking the net capital at starting from the net worth at closing, you may ascertain the gain ; or, in a losing business by taking the net worth at closing from the net ca[)ital| at starting, you may ascertain the loss. Then find the proportion of gain or loss oij each partner. The Resources and Liabilities are found in Single Entry, by ascertaining froral the Cash Book the amount of cash on hand ; from the Bill Book the resource oil Bills Receivable and the liability of Bills Payable ; from inventory the value of unsold! merchandise and any other property ; and from the Ledger the standing of personal] accounts. Having made out the statement of Resources and Liabilities for Set VlllJ found the worth, and the gain or loss, and carried the proportion belonging to eacli| partner to his account, balance and close the partners' accounts, and bring down tol the credit of each his net worth, and it will be well also (though not essential) tJ balance and close the personal accounts and bring the balances down ; then opeJ Cash, Merchandise, Bills Receivable, Bills Payable and Real Estate accounts in thel Ledger, entering the several amounts in each, with the explanation, from the Statej ment. Prove that your Ledger is in equilibrium, then proceed with the transaction! of the next Set by Double Entry, using the same Ledger, without disturbing any cil the accounts already opened. The Resource and Liability statement, if correctly made out, must be in balancel when you include the proprietors' worth, consequently when you gel your Ledgcl accounts to agree with it your Ledger must be in balance also. TO CLOSE A SINGLE ENTRY LEDGER. As we convert the Single Entry Ledger to Double Entry at the close of this Sell it is well that we should explain how a Single Entry Ledger, that is intended to bej continued in that method, should be closed. Take stock, and make out a statemeni of Resources and Liabilities, the difference between which is your capital. Find thel gain by subtracting the worth when you last closed the books from ttie present wortlii allowing in your calculation for any new capital added or any withdrawn. Credit thel proprietor's account with the gain, then balance his account and bring down the balancJ on the credit side, which is his worth at the beginning of the new business yearf then balance each personal account and bring the balances down It will be well, i| * If the Capital acc't. has not been kept so as to show tlic proprietors' iiive.Uments and witlidrawals accurately, a you can ilu is to debit or credit the proprietors' .acc't. nith a sum sufficient to bring it into harmony with the stat':nitni c Resources and Liabilities. 83 order to have it permanently on record, and easy of reference in future years, to copy Ithe Statement of Resources and Liabilities, as well as the woric of finding the gain, linto the Day Book. SET IX. DRY GOODS BUSINESS. TO THE STUDENT. The books to be used in working this Set by Double Entry are, Day Book and Journal combined, Cash Book, Bill Book and Ledger. The eight previous Sets have all been conducted upon the old Italian method. Another way of recording transactions will now be introduced, which is more direct, and by which much useless writing may be avoided. It will at first reciuire more thought on your part than the previous Sets have done, but you are now suppo-;ed |to have mastered the elementary principles of Book-keeping, and to be prepared for 1 higher step on the road to a thorough knowledge of accounts The plan of doing this set IS to entirely dispense with the Day Book in history form, and use instead Day look in Journal form, denominated the Journal Day Book, in which the entries aie hcorded in such a manner, as not only to present a complete history of the business [ransactions, but also to furnish debits and credits under the proper Ledger titles, feady for posting, thus rendering it useless to keep a Journal. The general rule for lournalizing now becomes a general rule for determining the proper debits and predits in making original entries. In writing up your Journal Day Book remember [hat no Cash transactions appear in it. The (^ash Book used in connection with Sets V. to VIII. inclusive, was only for [he purpose of preserving the Cash account from error, and giving you an idea of [low it should be kept ; but as used in this set it has a still more important office. // is the exclusive and only book of original entry for Cash transactions, and these transactions are posted directly from it to the Ledger. See form and explanation ( f lournal Day Book and Cash Book (or Cash Journal) at the end of the Set. • DRY GOODS BUSINESS.— Set IX. Note. — Before beginning the 9th set yon must have changed the Siu^^le Entry Ui'iicr of the Sth set \o Double Entry, as fu,"v explained on page Ss ; and to the converted ledger you 'will post the iittius of \u gth set, [iondor, Ont, April ist, 1894. — Miller .ind Lane have this df>y changed their hooks from Sini^le to DouMe Entry. pought of y. R. Marvin, on acct., Goods as per invoice, .ifyoo. Bought of Jones & Co., on our note at 3 months, with interest at 9 per cent.. Mdse., as per invoice, iSssoo. [2— Sold Robert Carey, on acct., 2 pieces Scotch Tweed, 35 yds. each, at -SlSo; 4 pieces Cassimere, 30 yds. each, at $2. |4— Bought for Cash 10 pieces Factory Cotton, 60 yds. each at loc. Sold C. A Lanjjford, for his note at 2 months, with interest at 10 per cent., 2 cases Prints 1500 yards, at 15c. ; 3 cases Irish Linen, 1280 yards, at 25c.; 1 case Scotch Tweed, 450 yards, at .^i-So ; 1 case IJroadclolh, 175 yards, at .$4. Cash Sales this day, .$134 75. 3— Shipped per Steamer "Alexandra" and consigned to R. Way, Picton, to In- sold on our acct., S pes. Broadcloth, 20 yards each, at .^4. Paid freight on same, $6.50. Cash Sales, $136.20 5-Sold Real Estate for $1250 ; received in payment Draft at 15 days on Thomas Davis for $850 ; cash for the balance, $400. c 84 9— Oave W. McKay Draft at 30 days on T'imes Goodwin for $287.50. Cash Saks, $195. lo—Received from Robert Carey, Cash on account $100. Sold A. Diamond, for Cheque, 4 yardJ Black Broadcloth at )?5 ; 3 yards Scotch Tweed at 82 ; I Vest Tattern, $5. Cash Hales //n[ day, $230.15. 12 — Boufjht of Henry & Co., 20 pes. Red Flannel, 40 yards each, at 30c ; 10 pes. Wincey, 30 yardJ each, at 25c : gave in payment Sight Draft on U. Simmons for $269.50 ; Cash for balanccj Cash Sales, $200. 14 — F. Lane withdrew on private account, $150. I'iiid Gas Bill, $14.50. Taxes, $45.70, Caj| Sales, $170. 16 — Received from B. Way, Picton. acct. of Sales of Mdse. shipped bim 6th inst.; the net proccedl remitted per Cheque (payable here at par) amount to $760 75. 17 — Sold S. Edsall, on his note at 3 months, 4 pes. Summer Tweed. 35 yds. each, at $1.50. Ca\ Sales, .$180. 18 — Had S. Edsall's Note Miscounted at Montreal Bank ; discount off at 7 per cent., § ; caslj received, % . Turn at once to the page (see index) and study the subject of " DiscountinJ Notes and Entries." Paid Cash for a bill of Mdse., bou!;ht at auction, .S75.20. 20 — Paid Clerk's Salary, §140 ; for sundry Expenses, $18.50. 21 — Bought for Cash, from T. J. Claxton & Co., Mdse., as per invoice, §1200. Paid for Cartage,] $1.50 ; sundry Expenses, §9. Cash Sales, §245.50. 22 — Bought of J. G. Mackenzie & Co., Mdse., as per invoice, -iiiSoo ; gave in payment our Acceptanc(| at 5 days, $550 ; cash for balance, !?250. Casli Sales, %T2'^. 23— Bought of I. McKay, for Cash, Mdse., 8150. J. S. Miller withdrew on acct. $200. Cash S.al\ this day, $475.50. 26 — Paid Cash for our Draft of 22nd inst., favor of J. G. Mackenzie & Co., $ . Cash Sak\ $695.40 30— Bought for Cash, of T. Anderson, ]\Idse., $100. Paid for Insurance, $14.75 5 Cartage, $3 20.| Casli Sales, $480.25. INVENTORY OF RESOURCES .AND LIABILITIES NOT SHOWN ON THE LEDGER- RESOURCES. — Merchandise remaining unsold, .S4300. Interest receivable — Accrued to date t\ Langford's Note, .$13.68 LIABILITY. — Interest payable— Ace II ninlated on our Note favor Jones &= Co., .$17.88, Tolii net gain $2022. 'JO. Miller's sha7e, .$871.61. Lane's share. .$1151.09 TO THE STUDENT. Wc would here again impress upon the student the necessity of study. There is no better test of a person's knowledge of Book-keeping than that connected will what you have just been doing, — changin;^ books from Single to Double Entry. HerJ the matter is made clear, and easily understood. See that you master thoroughly thel principles involved, so that if you are called upon, in the course of your businesf career, to change books from Single to Double Entry, you may be able to do s| intelligently, and to explain and give the reason for what you do Impress this point upon your mind : that the facts you require to ascertain tol open books by Double Entry, or change books from Single to Double Entry, are thJ Resources and Liabilities of the concern. TO CHANGE DOUBLE ENTRY COOKS TO SINGLE ENTRY. Discontinue in the Ledger all accounts hut those with individuals, but continue th(| use of the .luxiliary books, such as the Cosh Book, Bill Books, etc. " This is c cclusively a cash transaction, and entered on both the debit and credit side of the Cash I'ook. Kntertil full amount of Note on the debit side, as if the firm .ictually received it, and then enter the amount paid 'or discount 1 the credit side. See the Cash Hook of Set IX. If the proceeds had been lett in I3ank you would also make cash crcciJ by liank, same as for a deposit. t There is a marked peculiarity in the Inventory, viz., the showing of a liability .-is a necessary part of the Inventorji Another peciili-trily growing out of this presentment of facts is the debiting of Interest Account with the li.abililyo interest, as well as crediting it with the resource of interest, before closir:g the account. 86 JOURNAL DAY BOOK-Skt IX. You are requested to observe particularly the following form, that you may be Ible to express, in this manner, any conceivable transaction, combining all the [ssential points of the separate Day Book and Journal. Very few large business louses adopt the old method of first entering transactions in a historical Day Book, Ind Journalizing therefrom. Where more practical forms, for the purpose of corden- (ation, are not in use, the Journal Day Book meets with great favor, as beinp both }lain and practical. In writing up this book, make your Journal entry first, irom the record of Jransactions ; then write the explanation immediately under it in a smaller hand, [ommencing about half way between the centre of the page and the folio column, as illustrated in the following : FORM OF JOURNAL DAY BOOK. London, Out., April ist, 1894. Mdse. Dr. Bought on acct. Goods as per invoice. To J. R. Marvin, I' Mdse, Dr. To Bills Tayahle, Bought of Jones & Co. on our Note, as per B. B., with interest at 9 per cent., Mdse. as per invoice. Robert Carey Dr. Sold him on acc't. as follows : 2 pes. Scotch Tweed, 70 yds., at Si 50 4 " Cassimere, 120 yds., at 2.00 To Mdse., 5^105.00 240.00 700 2500 345 Bills Receivable Dr. To Mdse., Sold C. A. Langford, for his Note at 2 months, with interest at 10 per cent. : 2 cases Prints, 1500 yds., at 80.15 .?22S.oo 3 cases Irish Linen, 1280 yds , at 0.25 320.00 I case Scotch Tweed, 450 yds., at 1.50 675.00 I case Broadcloth, 175 yds., pf 4 00 700.00 1920 Shipment to Way No. i Dr. * To Mdse., Shipped to B. Way, Piclon, per Steamer Alexandra, to l.sh .are I" lie entered only in the Jotirn.d D.iy IV'ok, and exclusive Cash Insaclions, such as the purchase of Cotton on the 4th, only in the Cash liook. 'These transactions heing of ;i mi:;ed nature are entered in both Jqurnal iJay liook aid Cash I'ook. 86 CASH BOOK. Pr. -CASH.- IS94. Apr, L.F. I 4 N^ 6 x' 8 24 9 X^ 10 25 10 x' 10 X 12 X 14 x' 16 26 17 x/ 18 24 21 n; 22 x^ 23 ^, 26 x/ 30 x/ 20 21 Balance rrnm last month, $3014.77 To Merchandise, Salts from Petty C. B Real Estate, Lot Mountain Street, D. B Merchandise, Sales as per Petty C. H Robert Carey, On account Merchandise, A. Diamond's Check Sales Petty C.B t( >> Ship't.toWay No. 1, Net Proceeds per Check Merchandise, Sales from P. C.B Bills Receivable, Edsall's Note discounted Merchandise, Sales from P. C. B (( i< It 4( ik *t 1< (t It Total to a; of Merchandise Total to debit oj Cash .... From last month Mdse >34 136 >9S 31 230 200 170 180 245 725 475 695 480 3898 75 20 '5 50 SO 40 25 Sundries 400 100 760 210 ►389S 5^69 3014 8384 2; The Cash Book is the most important of all the auxiliary books, for the CasfJ account is found to be the most difficult to keep correctly of the whole list of accountsj because Cash is the basis of all trade, and is constantly passing out for purchaseij expenses, etc., and coming in for debts and sales. In business the Cash Book is generally balanced every night. We could not,i a work like this, introduce a sufficient number of entries to carry this out ; we havj therefore left it open until the end of the month. As the above Cash Book is the boo' of original entry for all such transactions: are entered upon it, great care is necessary in making these entries. They should be made in such a manner that any person may be able 1 determine what account was inte'iJed to be debited or credited for the money p3i(| or received. For this purpose -xcountants adopt the following Rule : When money is receiver., write the name of the account to be credited fori'| next the folio or date column on the left side, arid th ; words of explanation, on same line a little to the right. When money is paid, write the fiame of the accouJ to be debited for it, next the folio or date colu;nn on the right side, and the words jj explanation on the same line a little to the right. The Ledger titles should be kept in a perpendicular column, separated byi slight space from the words of explanation And it adds greatly to the appearanci of the book to begin the words of explanation all on a perpendicular line, made bv| light pencil mark, and write them one half smaller than the Ledger titles. NoTR. — The bal.'ii; e from the last month, it will be observed, has not been cxtendetl in the money columns, liiciij it is r.lready entered in 'he Ledger; it' extended it would be aiiJed with the total receipts, and posted a second tiiia. I is necessaiy, however, lo add the Cash in hand from last month with the receipts durinj, this month in order to obtain -I proper balance. When you require to continue the (ash liook, after it ins been closed, brin^ down the balance on l| Dr. side, without extending the amount in the money colunms. and conti:me it the s.-uue as above. * Red Ink. Nd rii:. — Many book-keepers do not keep a cash accoiuit in the Ledger, nor is it necessary, because the cash M (kept as ubuve) slic /s cunstanlly the conditiuii of cash. lolumn ; and th lOK. Sundries 400 100 760 210 •389S 75 77 2" 5^69 30'4 8384 Set IX. >S7 CONTRA O. •r the CasI )f accounts! ■ purchaseJ :)uld not,ij ; we havi] isactions ; 3e able noney pal iited fori] jon, on ttl le accoup| lie words! irated byi appearanci made byf lolumns, becatj second time. Jer to obtain "'I e liaUuiCf oiii' se the cash 1)'| IS94 Apr. L. 1' 4 >,' 20 12 s' 14 24 •' 24 iS 26 it s' 20 ^1 21 s' *• 24 22 >.{ 23 1 v *i 25 26 ^5, 30 N^ 24 21 20 By Merchandise, Ship' to Way No Merchandise, F. Lane, Expense, Discount, Merchandise, Expense. Merchandise, Expense, Merchandise, J. S. Miller, Bills Payable, Merchandise, Expense, Invoice of cotton 1, Kreiglil on same Invoice from Henry Hi Co Withdrew on Account Gas Bill, •'ii'M.so ; Taxes, 845 70.. . On S. Ed.sall's Note Houglit at Auction. Waj^es, i^r^o ; hooks, .S18.S0 T. J. Claxton & Co.'s Invoice . . . . Cartage, .ijii.SO ; Repairing, ijpg... Inv. J, G. MacKenzie fc Co., iJ. V>. Invoice J. McKay Withdrew on Account Draft favor J. G. Mackenzie & Co. . T. Anderson's Invoice , Isnur. , 814.75 ; Cartage, .S3.20. Mdse. 63 Total to (ti'bit of Mcrchamiisi Total to credit of Cash 15AI.ANCK* Sundries. 6 50 Post from the Cash Book and Journal Day Book in the same order as regards Ihe dates when the transactions were entered. The above is a very convenient form of Cash Book to be kept in connection vith a general merchandise business. The feature of special columns may be extended, |f desirable, as is shown in the Cash Book of Set XI. It will be seen that all Cash Entries, debit and credit, are taken directly to the Ledger from this book. The amounts distinguished as per " Petty Cash Book " |re entered here from a book showing cash sales corresponding with the contents k the till. The columns headed " Mdse." will be found very convenient for posting, jhould the Cash transactions of a month extend over several pages, the footings of Ihese columns are brought forward to the end of the month, and posted in total. The Iheck marks in the column following dates are made to indicate that the amounts Opposite, in the " Mdse," column, are not io he posted^ and the figures are the pages |f the accounts in the Ledger to which the amounts in the " Sundries" column [pposiie have been posted. The method of posting from the Cash Book is extremely jimple. The amounts in the " Sundries" column on the Dr. side are posted to the credit If their respective accounts — the page of the Ledger being indicated in the folio lolumn ; and the amounts in the " Sundries " coluir.n on the Cr. side, to the debit )f their respec'.ive accounts. The footing of the " Mdse." column on the Dr. side is * Red Ink. NiiTE. — In m.ikii)R entries in yoiir Cash liook, always oliscive the alw-; style of arianj^tnient, and .\liVKK kntku bli". Tlii.K CASH anywhere in this hook, e.\cept the heailini; at lln- hesinninK ot the pane ; for you ^;nter notliing in it but I'lsli. It is ininecessary to use the words " received " and " paid " in e.vplainiiij; an entry, as nothing is entered on the kbit side of this account except Casli received, and nothing but Cash paid out on the credit side. Ill balancing the Cash Hook always ride th:it side first upon which appears the greater number of entries, and have It liiotings of the two sides directij' opposite one anotlier. When long explanations have to be given in a Cash Uook, it may he desirable to put the names of the acct. on one he .iiid the explanation on the line or lines (if more than one explanatory line is reipiired) below c ^ >.-. ;» r 8S posted nt the end of the month to the credit of Merchandise account, and the total footing of the " Mdse." column, on the Cr. side, to the debit of Merchandise account, The Cash received, or amount of the Dr. side of the Cash Book, is then posted to ihe debit of Cash account, and the total footing of the Cr. side, or Cash disbursed, to the credit of Cash Account in the Ledger. As the debit side of the Cash Book contains the credits of all accounts producing Cash, and the credit side the debits of all accounts costing Cash, it will be seen thai when the above posting is completed a double entry is effected. PUTTING CHEQUES THROUGH THE CASH BOOK. Whether Cheques shall be journalized, or put through the Cash Book (when the latter is kept as in this and subsequeut Sets), is simply a matter of convenience, Either way is right, and has precisely the same effect. Adopt which you deem best for the business you may be engaged in. When puttirig a Cheque through the C. B., first make Cash Dr. to Bank for Cheque No. — , just as though you had received the amount ; then make cash Cr. by the individual or the account for which you pay the Cheque, giving the usual explan- ation. The municipal Set treats Cheques in this way, but we deem it well to give here an EXAMPLE. You give a Cheque on Bank of Montreal to retire yoi'r note for $520.00 and interest accumulated $12.00 ; the following would be the entries : Dr. CASH CONTRA. O Oct, 29 To Bank. For Cheque No. 132 $532 00 Oct, 29 By Bills Payable. Retired B. P. No. 81 by Cheque 132 " Interest. For int. on above $520,00 12:00 Questions for Review — Chapter V. What do you understand by the term " Consignor? " What by " Consignee? What is " Shipment " as a Ledger title ? When is " Shipment " made Dr ? ' Witl what is it credited ? When is it closed " To " or " By " Loss and Gain t When \ Bahmce Inventory ? What is *' Consignment " as a Ledger title ? With what is it debited ? With what credited ? How is it closed ? When " Shipment " is used a; a Ledger title what should it have attached? When "Consignment" is used as a Ledger title, what should it have attached ? What is a Cash Book used for ? When ever money is received, how is it entered in the Cash Book ? Whenever money ii paid out, how entered ? How can the balance in hand be found at any time ? Witl what must this agree ? Can the Cr. column of the Cash Account be the greater: How often should the Cash Book be balanced ? How is this done ? What account! are kept in Single Entry ? What are the principal books of entry ? What othei books are introduced, and why ? From what book do you post in Single Entryp How do you convert Single Entry to Double Entry ? How can you ascertain thi Net Gain or Loss ? How are the Resources and Liabilities found in Single Entry How do you close a Single Entry Ledger ? What old method has been observed ii the preceding eight sets ? What books are now dispensed with ? What book used instead ? Which is the most important of all the Auxiliary Books ? In generi business how often is the Cash Book balanced ? CAN. PRACl ADAPTED [HOLESALE STEAMBO/ ESTATES, FOR PUB COUNTING STOCK CO THE [CANADIAN ACCOUNTANT. 20.00 andl msignee? ?■■•• Witi When b;] what is is used ail used as al ? Whenl r money i] ne? WtM le greater 1 It accounti Vhat othel ;le Entryf certain m ;le Entry! b served iij lat book In general CONTAINING THE MOST PRACTICAL FORMS OF KEEPING ACCOUNTS, ADAPTED TO THE VARIOUS DEPARTMENTS OF BUSINESS, INCLUDING COMPLETE SETS OF BOOKS IN [HOLESALE AND RETAIL MERCHANDISING, MANUFACTURING, STEAMBOATING, MUNICIPAL BOOK-KEEPING, SETTLEMENT OF ESTATES, WAREHOUSING, FARM ACCOUNTS, BOOK-KEEPING FOR PUBLIC INSTITUTIONS AND CHURCHES, PRACTICAL COUNTING HOUSE WORK, CHAPTERS ON BANKING, JOINT STOCK COMPANIES, Etc., Etc. 90 TO THE STUDENT. You have now been presented with nine Sets of Books, eight by Double Entry and one by Single, representing you as carrying on different kinds of business, some of which have been prosperously pursued and others attended with misfortune. 'Hit' exercises already passed over are considered sufficient to illustrate the ojiening and | closing of Books, both individual and partnership, under the various positions of fj^m and losses, capital and insolvency. A good understanding of the preceding Sets will ground you thoroughly in ihel principles of the science of Book-kccping. We will next present you with some of the most approved methods and practical forms of keeping accounts, such as are now j in use in counting houses in the various branches of businesi. Writers on the subject have by no means kept abreast of the changes and! improvements effected by practical Accountants in the form and use of the different books and the improvements made, with the object to adapt them to any particulati kind of business. The want of practicability in the treatises on Book-keeping alreadvl in use was one of the chief reasons that induced the writing and publication of this| work. BUSINESS STATEMENTS. There are many forms of business statements now in use, each possessing sorael peculiar meiit,, and all having the same general purpose in view, viz., that of exhibiting the real and i)rogressive condition of the business represented. The forms hithertof used in this work, Part I., are both simple .and coniprehensive, and would probably bel preferred by one not versed in book-keeping, as they are easily understood ; but as i:l is necessary that you should understand different modes of making out busineil statements, and as we know of no form that compasses so much within such limitei space as that given on the following page, we require you to make out a similaij BALANCE SHEET from each of the following Sets. A trial balance taken with Dr. and Cr. footings, similar to the following, will sufficient to exhibit the necessary results of the Ledger, from which to render | Balance Sheet. L. F. 12 12 >3 14 14 15 i6 17 i8 ACCOUNTS. Stock Cash Flour Wheat N. W. PhiliiJs Robert Brown Bills Payable Bills Receivable Expense Inventory : Flour $3360. Wheat 1050. DR FOOTING. 6850 SO 5080 2420 710 930 1280 620 «5S «5 18045 65 CR. FOOTING. 8000 2725 2810 1630 5° 1000 1380 450 18045 3 u X 73 u u < oq to rt m 0^ u O to •z o ^•5 aq .5 rS 1) .2 bc ,^ n bo ^ C 1) 'S ^- s, « Ml c 9 rt X (n U C "33 3 u < C )-. rt o e o o is g a ,0 jS to ll 1/1 rt i) VI Ih 2 u 3 91 9 Uh e Entry 'Z 58, some X e. The 7) ing ana of n^ins /4 < V in the ti some ol 4-> 3 are now bO c nges and E different particular in N Ig already )n of this the proc< on page S! S 2 •- H ^ ^ W 3 OJ w sing some r:: « exhibiting M IS hitherto p .5 U robably be U 3 Z •< ; but as i: J < It busines 25 •- oq ch limitec .2 be t a similai bfl I' .5 H ig, will bi render: _. the e par ■K- CR. from mor FOOTING. 11 c M p rt If ♦J ij 8ooo 5^ S 2i I4 u 272s 'i 2810 5-7= 1630 ';o C 1) 1000 1380 ; 450 The {0 ctions loi 18045 ' II p U M Si u o i •J 1 1 2 S _. W R ^ ft? f1 On "lO O ( — "^ O •>! O 1^ <*1 IT) vO I »/1 00 in ON o> •ri Ov o\ ITN' en 'A < 8 8^5 - « 00 8 ir> >" oi > vO 'O f^ Tt 'A m- rf 1^ O •'I iri m O O O O Q O N N ». — — 00 m in m ^^ vO m in moo N 'OOO N in t 00 1- !>. On N vO <^ VO mN ■* T^ ^ in in ui mvo vO O n tn c? J2 *rr *^ V X > :3 X 'n a >• "5 1 8 S (J d (1 •s s bi) .5 '? o M C c ^ 5 S o •« i| C B 3 8,8 bo 3 c 5 o o it ■a o .a u B o 1/1 •§ "■s s B B o 3 u n J3 J en -S ^f^ o *^ j3 •: o — *4 i; ■^ a i S E -s o «M >. B .2 2 t{ 't IMAGE EVALUATION TEST TARGET (MT-3) O 111.0 V^ m \^^. i Itt Itt 12.2 II [SSSB = Sf Bft ■— M 1^ IIU4U4 tw _- s. *>^ V" Hiotographic ScMices Carporatian \ 33 W«T MAIN STRUT WIISrM,N.Y. I4SN (7U)t73*4MMI 6^ (V % *♦: BALANCE SHEET. In commercial language a " Balance Sheet " signifies the systematic arrangement of facts, for the purpose of exhibiting at a view the condition of business. The forms in use vary according to the necessities of the occasion or the ingenuity of the accountant. The following explanation will be found serviceable in preparing this sheet for the entries. The method of enforcing the facts will be apparent to any diligent student. 1. Take a sheet of paper of proper size, and for a border rule double red lines around the margin. 2. Rule parallel head lines, leaving proper space for double captions, as in the example. 3. Ascertain the number of the Ledger accounts to be represented, which will embrace all the accounts in the Trial Balance. If the business is that of a single proprietor, rule in pencil as many lines as will contain all the accounts and fm additional. If it be a partnership business with two or more partners, rule three additional lines for each partner ; thus, for a single proprietor _/fw lines more than all the accounts ; for two partners, eight lines more than all the accounts ; for three partners, eleven lines more, and so on. 4. Lay off proper spaces for debit and credit money columns ; first for the foot- ings of Ledger Accounts, second for Gains and Losses, third for Stock,or, if partners, tor each partner, and fourth for Resources and Liabilities ; also a single money column for Inventories and for Ledger titles and their Ledger folios. The position ot these columns will be seen in the example given. 5. After denoting the proper space for each heading, which can be best done with pencil, commence to rule in red ink at the right hand and bring all the lines of the two captions, " Real Accounts " and " Stock " or one of the partners, down to the lower pencil line. For the other partners drop two lines. For Losses and Gains | drop two lines in single proprietor's business, and one additional for each partner. 6. Rule the foot lines as shown, and the schedule will be ready to receive the | accounts SHIPMENT GO'S AND MERCHANDISE GO'S. " Shipment Company " is a term used to represent your interest in merchandise or other property shipped by you, to be sold on joint account and risk of yourself and other parties ; or it may represent your interest where you receive intelligence that] other parties have shipped to a third party and that you are interested. It is made Dr. for your interest and share of the costs in the speculation when! the shipment is made, and at the same time the parties interested with you arel debited for their share of the merchandise and charges ; it is credited with all incomes, [ and, after being posted to the Ledger, closes " To " or " By " Loss and Gain. Should you wish to close the Ledger before an account of sales has beenl received, credit Shipment Company " By Balance Inventory " for the amount it cost] you. The title " Merchandise Company " is a fictitious name givtn to goods or other! property received by you to sell on joint account and risk. It is made Dr. to the! consignor when received for only your interest, and is debited for charges incurred! until it is disposed of The consignor should be credited for your share of the goods| the same as though bought of him on account, unless settled for at the time receiving them. In selling goods that have been received to sell on joint accunt, Cr. Merchandise| Company for all sales. 93 In closing a Merchandise Company, deduct total charges from total sales. This leaves net proceeds in favor of all parties, each one having shared his part of the charges incurred. Now, having in your possession the proceeds, each interested party should be credited with his share of them. In closing a Merchandise Company, it is made Dr. to Commission, to all charges which have not been posted, to the shipper or shippers tor their net proceeds, and to Loss and Gain for your gain ; if a losing operation. Loss and Gain is made Dr. for your loss. Should the goods, at the time of closing, be but partially sold, then Merchandise Company should be Cr. in the Ledger " By Balance Inventory," only for your share of the Merchandise remaining on hand, the remainder belonging to the shipper or shippers. Shipment Companies and Merchandise Companies represent the temporary co- partnerships existing between the consignor and consignee, having reference to the sale of particular consignments of Merchandise. These co-partnerships differ from general co-partnerships only in their duration and the manner of their sales. The consignee acts as a commission merchant, and m that capacity receives and disposes of the property as he would of a simple consignment ; the only difference being that |he is interested in the gains and losses. A second method of considering these transactions is to recognize the principle [that the holder of the property is responsible for it. Thus, when you receive from |Pitceathly & Kelso an invoice to be sold on joint account, you debit Merchandise Company with th2 invoice and expenses, and credit the consignors with the cost of ^he invoice, thus making yourself responsible for the property as though it were all ^our own. The consignor's entry (recognizing the same principle) will be to debit I'ou for the entire cost of the Merchandise, Where tliere are more than two parties Interested, if the accounts are taken by this method, the consignee should debit the Merchandise Company with its entire cost — and credit the consignor with their (the bonsignee's and consignor's) joint share, and any other party or parties with his or Iheir share. The consignor's entry in such a case would be to debit the consignee with their )int share, and each of the other parties with his or their share. The other parties pould, if making an entry to correspond, debit the consignee and credit the consignor [ach for his own share. The foregoing illustrations it is hoped, will be sufficient to fasten the principles [ these accounts upon the mind of the learner. The only difference in the two nethods is a simple matter of time. By the first method, the consignee is considered Is responsible for the property when he has disposed of it and by the second 7vhen he Received it. The final result is the same in either case ; though, as far as right and psponsibility are concerned, the first method is the correct and philosophical one — he principle recognized being that the owner of the property is responsible. "We submit these separate methods, because we consider that the more the garner permits himself to dwell upon these principles, and the better he comprehends Jiem in all their bearings, the more thorough and available will be his knowledge. erchandiseB 'Yhe exercises on the following pages will show the application of the foregoing rinciples. ;ement ; forms of the ng this to any ;d lines s in the ich will a single and five le three ore than for three the foot- partners, f column of these )est done ; lines of I down to 1 ,nd Gains | irtner. ceive the | rchandise urself and ence that tion when you are I incomes,! Iin. has been I unt it costi s or other Dr. to the s incurred the goods, me time ol| •1 t9 Ctr, <« 1$ iU.>M*» EXERCISES ON JOURNALIZING SHIPMENT COS. AND MERCHANDISE COS. You should lay a sheet of paper over the following solutions, and not refer to them while you are writing out the Journal Entries. Transaciiotts. I — Jones ships Brown, to be sold on joint acct. and risk, Mdse. valued at $1200; and pays cash for insurance on same $40. 2— Brown on receipt of the goods pays cash for freight and other charges amounting to $70. 50. 3— Brown sells the goods for $1450. Receives in payment a Cheque for $500. Cash $500, and a Note for the balance. 4 — Brown renders an accounts of sales ; his charges are as follows : Drayage, $4.50 ; Storage, $5.00 ; Cooperage $6.50 ; Commis- sion, 3 per cent. The following forms explain the manner of closing the Mdse. Co. : Total Sales, Charges already posted, •' not Commission, Total net proceeds, Brown's one half. Cost of " " $70.50 16.00 43-5° 660.00 620 00 40.00 $1450 130 1320 Brown's gain, J — Jones' entry on receipt of above account of sales. 6 — Brown's entry on remitting am't to balance Jones' acct. per Cheque. 7 — Jones' entry on receipt of above remittance. Journalized. 1— Shipment Co. •' A " Dr. $620 Brown 620 To Mdse. $1200.00 " Cash 40.00 2-Mdse. Co. "A" Dr. $690.50 To Jones $620.00 " Cash 70.150 3— Cash Dr. $1000 Bill Receivable " 450 To Mdse. Co. " A " $1450 4— Mdse. Co. " A" Dr. $759-50 To Charges $ 16.00 " Com. 43.50 I " Jones 660.C0 " Loss and Gain 40.00 | In closing a Mdse. Co. and making the account siles entry, first find what all the sales amount to, then total charges (not including cost), and by deducting the total charges from the total sales you obtain the whole net proceeds. The individual net proceeds are found by dividing the total net proceeds by the number of parties interested. Your gain or loss is found by taking the diflference between your proceeds and the amount you credited the shipper with when you received the goods. 5— Brown Dr. $660, To Shipment Co. " A " $66o.oo| 6— Jones Dr. $1280, To Bank $1 28000] 7— Cash Dr. $1280, To Brown $i28o.co| It is difficult to understand the closing entry of either a Mdse. Co. or a Consignment, unless you have before you the position of the account upon the Ledger. If your Ledger is not posted when closing a Mdse. Co. and making the account Sales Entry, open the account on a piece of paper, and show its total debits and credits as they exist, and will appear in the Ledger when posted. If you have studied carefully the transactions to number 7, and understand them, you will have grasped the principles involved in the book-keeping entries foil joint shipments and consignments. The study of these, along with the practid transactions given in the XI. Set, will enable you to pass the examination on Joint Shipments, and deal with them in actual business life. The balance of the examplesj may also be studied with profit at any time K — Received from Smith, for sale on joint acct., gooda valued at $840. Paid freight on same, $100 ; wharfage, storage, drayage, etc., $60. 9 — Having sold the goods for $850, I render an acct. of sales. Charges already posted, $160. After charges for drayage, etc., $10. Com- mission and guarantee, 5 per cent. 10— Suppose the above goods were sold for $1200, and I remit the amount due Smith with the acct. of sales. 8— Mdse. Co. Dr. $580, To Smith " Cash 9 —Mdse. Co. Dr. $270 Loss & Gain Dr. $101.25, To Smith " Commission '* Charges 10— Smith Dr. $420, Mdse Co. Dr. t620. To Cash " Commission '• Charges *' Loss it Gain $420,C I60.C $3'S 420I iccl $905.0 6o,(ij 10,0 65.C 95 Transactions, II— Suppose the above goods were all destroyed by fire after coining into my possession. 12— Suppose the goods per No. 3 were partially destroyed and the bilance sold for $150. 13— Shipped West, to be sold on joint account of East, consignee and myself each y^ ; goods valued at $1200. Paid insurance on same, •930. 14— West returns the whole of the above goods. Charges paid by him, $60, 15— Suppose that, in example No. 4, Brown has only sold \ the goods for $700, at the time of rendering an account of sales, and that the charges and commission are the same as in the former case. 16— Suppose S. G. Beatty sends you $2000 worth of Mdse. for sale on joint acct., and you add goods to make up the joint property to $3500, what will your entry be ? 17— What will S. G. Beatty's entry be in the above case, when he receives advice and invoice of goods added ? 18— Supposing the whole of the speculation per No. 16 produces only $3000, and your charge for commission is 4 per cent., how would the account close ? 19— Samuel ships Student on joint account and risk Mdse. $1200, and pays freight, $20 per Sight Draft on Student. Samuel's entry ? 1 20— Student's entry on receipt of the goods accepting Samuel's Draft on him, and at the same time paying $10 per cheque for cartage. 1 21— Student having sold the goods for $I5CX) renders an account of sales, and remits $50 to Samuel per note. Unposted charges, $12. Commission, 2^ per cent, on sales. Student's entry ? 1 22— Student remits amount yet due Samuel per Time Draft on B, $800. and the balance in Cash. Student's entry ? 123— Samuel's entry on receipt of last remittance ? Joiirnalizcd, II- -Loss & Gain Dr. $500, Smith " 80, To Mdse. Co. .5580. CX) 12- —Loss & Gain Dr. $425, Smith " 5, To Mdse. Co. I430.OO 13- -Ship't Co. Dr. .$410. West " 410, East " 410, To Mdse. $1200.00 " Cash, 30.00 14 -Mdse. Dr. Iff 200, To West, §420.00 " East, 400.00 " Shipm'tCo. 380.00 •5- -Ch.irges posted $70.50 " Unposted 16.00 Commission 21.00 Tot.-xl Sales.. . . $700.00 Total Charges 107.50 107.50 Total Net proceeds.. . 592.50 Brown's Proceeds 296.25 J Net Proceeds 296.25 Jones' " 296.25 j Un.sold Goods 300.00 Urown's ^ Invoice, 620.00 Pro. and Inventory, 596.25 Net Loss 23.75 Mdse. Co. Dr 309.50 Loss and Gain Dr) 23.75 16 — Mdse. Co. Dr. JS1750, To S. G. Beatly " Merchandise 17— Ship't Co. Dr §750. To Student 596.25 To Charges, $ 16.00 Commission, 21.00 To Jones, 296.25 5 250.00 150000 $750.00 18- -Mdse. Co. Dr. §1250, Loss & Gain, 310, To Commission % 120.00 " S, G. Beatty, 1440.00 19- -Ship't Co. Dr. |6io, Student " 590, To Mdse. $1200.00 20- -Mdse. Co. Dr. $620, To Samuel 590.00 " Cash 20.00 " Bank 10.00 21- -Mdse. Co. Dr. $880, To Charges $ 12.00 " Commission 37.50 " Samuel 670.25 •• B. Payable 50.00 " Loss & Gain 110.25 22- -Samuel Dr. .$1260.25, ToB. 800.00 " Cash, 460.25 23- -Bills Receivable Dr. $800, Cash " 460, To Student $1260.25 •N' « i ^ ^toiiii J* pfcu,.,-. 9$ SET X. (Corresponding with Set VIII. Part L) INCLUDING PRACTICAL FORM OF DAY BOOK AND JOURNAL COMBINED, AND ILLUSTRATING THE DISTINCTION BETWEEN SINGLE AND DOUBLE ENTRY. The transactions comprising this Set are the same as those in Set VIII., and are selected for the purpose of showing the exact difference between single and dourle ENTRY. A careful study and comparison of the two sets in their similar and dissimilar points will open to the mind of the student a clearer distinction between the two methods of accounts than could be effected by any other form of reasoning. This distinction is most apparent in the Ledger, where it will be seen that the additional accounts required by Double Entry are useful, mainly to denote special gains and losses. In performing the work of this Set you are required to introduce the SIX-COLUMN JOURNAL. The principal feature of this book, that of affording special columns for the I accounts most used, may be carried to any desirable extent ; and in some business { houses as many as eight special debit and credit columns are used. Its advantages may be briefly stated as follows : I St. — A vast saving of time and space in posting. 2nd. — Embracing the principles oifour books in one, viz. : Cash Book, Invoice Book, | Sales Book and Journal. 3rd. — Showing monthly totals of the principal accounts in the Ledger, that the saraej may be compared year after year. 4th. —Affording an opportunity to post personal accounts immediately, the debits and| credits appearing separately in the "Sundries" column, 5th. — Giving additional security of the correctness of the Ledger, there existing no| probability of admitting debits and credits of the same account. This book is called the six-column journal, because it is ruled with sixi columns, three debits on the left and three credits on the right. In making anl entry the same form of expression is used as upon the Journal Day Book of last Setj In entering a sale, extend the particulars first, like Carey's or Goodwin's entries on| form, The method of posting from this Journal is very simple. The separate items inl the " Sundries " column are posted the same as from the common Journal, while thel amounts of the " Cash " and " Mdse." columns are posted in totals at the close ofl each month. Every time these accounts are posted, it makes a period in thel amounts brought forward on the Journal, and the new period commences with the| heads of the columns empty. Before commencing this Set, observe closely the form of Six-column Journall given, as an understanding of it, at the beginning, will greatly facilitate your progress.! 97 oice Book, t the samel debits and) existing no I with six! making anl of last Set. entries on I ,te items inl I, while the! :he close ofl iod in thel :es with the! mn Journal ur progress. DRY GOODS BUSINESS. SET X. TWO PARTNERS. London, Ont., March ist, 1894.— J. S. Miller and F. Lane this day commence the iJry Goods business at N#. 114 St. James Street, agreeing to share gains and losses according to capital invested. J. S. MILLER invests : I Cash, $1500 ; Merchandise, $800 ; Note for $600, favor J. S. M., signed by Thomas Gibbard, dated January 31st, at 30 days ; an accepted draft for $400, drawn l)y J. Jones on D. Ko1)lin, dated January 20th, at 90 days. Balance due from J. R. Marvin, $125. 7 olal investment, $1^2$. F. LANE invests : I Cash, $1500; Merchandise, $I2CX) ; Real Estate, $700; Note against S. Fowler for $200, dated January 25th, at 6o days. Note against H. Jackson for $800, dated Nov. 23rd, 1893 at 6 months, with interest at 7 per cent. Interest accrued on above to date 98 days, $15.03. Total investment, $4415 03. 2— Bought of W. McKay, on acct.. Invoice of Merchandise amounting to $1800. Sold Robert Corey, on acct., 50 yds. Bl'k Broadcloth at $2.25 ; 12 Fancy Neckties at $1 each ; . 5 doz. prs. Lisle Thread Stockings at $3.25 per doz. 3— .Sold James Goodwin, 50 yards Flannel at 60c.; 25 yards Broadcloth at $3.75 ; 66 yards Cassimere at $1.25 ; received his Draft at 10 days' sight on A. Benson, for .$55 ; the balance to remain on acct. 4— Bor.ght of H. Simmons, Mdse., invoiced at $200 ; gave our Note at 60 days, $100 ; the balance to remain on acct. 5— Sold W. Harding, for Cash, 2 pes. Irish Linen, 66 yards each, at 85c. ; 35 yards Broadcloth at $2.50. 6— Sold W. Williams, for Note at 30 days, 2 pes. Blue Broadcloth, 45 yards each, at $1.75 ; 90 yards French Merino at 60c. Received from Robert Carey his Draft at sight on W. Johnson for $50. 8— Sold James Goodwin, on acct., 90 yards Scotch Tweed at $1.25 ; 45 do. Red Flannel at 55c. Bought of W. Harding, for our Note at 20 days, 5 pieces English Prints, 40 yds. each, at 25c. Sold Richard Manning, for his acceptance at 10 days, 10 yards Broadcloth at $2.25 ; 15 yards Mixed Tweed at $1.50. 9— Received from James Goodwin his Sight Draft on John James for $85. Bought of Richard Watson, for Cash, Merchandise invoiced at $200. In— Sold Henry Simmons, 24 yards Brown Beaver at $3.25 ; received Cash, $40 ; balance on acct. Bought of Wm. McKay, Merchandise invoiced at $500 ; gave in payment. Cash, $350 ; balance to remain on acct. p— Sold Robert Carey, on acct., 55 yards Blue Broadcloth at $1.75. Received from James Goodwin, Cash, $50 ; Cheque on Montreal Bank, $30. I3— Paid Wm. McKay, Cash, $1200. Sold John Johnson, for his Sight Draft on J. Wilson, 15 pairs Pants at $3.75. ' Sold Robt. Carey, on acct., 30 Vests at $2.25; 12 Ready-made Coats at $5-50. ^5— Sold H. Simmons, on acct., 9 Fine Overcoats at $i6. Sold John Cu nmings, for his Note at 20 days, 12 complete uniforms at $15. |6— Bought of A. Vermilyea, for our Note at 30 days, Mdse. invoiced at $175. Received Cash for James Goodwin's Draft of the 3rd inst. Paid our Note of the 4th inst., favor of U. Simmons, less discount at 6 per cent, for unexpired time. |7— Received from Robert Carey, Cash, $ioc. .Sold James Goodwin, on acct., 50 Summer Coats at $2.50. Bought of W. McKay, on 3 months' credit, Mdse. invoiced at $275. |8— Received Cash in full for T. Gibbard's Note of Jan. 31st, with interest at 6 per cent., for time overdue, 13 days. Received Cash from H. Simmons, $40. 0— Sold W. Manning, for Cheque on Merchants' Bank, 10 Military Coats at $11 ; 10 pairs Pants at $6. Sold Robert Carey, on acct., S dozen Byron Collars at .$2 per dozen ; 4 dozen Cravats at $3 per dozen. Received from James Goodwin, Cheque on Montreal Bank for $155. |l— Sold H. Simmons, on acct., 40 yards Blue Broadcloth at $1 80 ; 10 yards Black Beaver at $3.75. Received Cash for R. Manning's Draft of the 8th inst. Sold W. West for his Draft at todays on R. Bass, 50 yards French Cassimere at $3. Bought of W. McKay, on acct., Mdse., as per bill, amounting to $95. Note.— The names of Ledger accounts for this set and the number of lines to be left for each will be found on W 99- :•; 98 23— Sold Robert Carey, on acct., lO Summer Coats at $2.50 ; 40 yardH Red Flannel at 55c. 34 — Gave \V. McKay our Draft at 10 days' sight, on James Goodwin, (or $100. Sold II. Simmons, on acct., 10 yards Broadcloth at $2.25 ; 6 dozen French Yoke Shirts, $18 per dozen. Bouqhi I for ('ash, Mdse., as per hill, amountinf; to $300. Sold James Goodwin, on acct., 10 dozen | Undershirts at $7 per dozen ; 8 dozen pairs Knil Drawers at $8 per dozen. 25— Accepted W. McKay's Sight Draft on us. favor W. Barnes, for $500. Received from Robert | Carey, Sight Draft on James Goodwin for $125. 26— Sold H.Simmons, on acct., I piece French Cassimere, 50 yards, at •'?i.25. Had H. Jackson's! Note of Nov, 23rd, 1893, discounted at Merchants' Hank : face of Note, $8ro ; interest !ess| discount, at 7 per cent,, for unexpired time, 61 days, $18.54 ; cash received, $818 54* 28— Sold James Goodwin 15 complete Uniforms at $14 ; received in part payment Sight Draft on] Montreal Bank, $50 ; balance to remain on acct. 29— Gave W. McKay our Sight Draft on II. Simmons for $75. Bought for Cash, Mdse., as per amounting to $400. Received Cash in full for S. Fowler's Note, January 25th. Paid CashI for Gas Bill, $20 ; Wood, $15 ; Rent $50. 30— Received Cash for D. Roblin's Draft of January 20th, less discount for unexpired time at 7 perl cent. I'aid Shop hands Cash in full for services to date, $120. .,'// this date yon will post the Books and take off a Coiiihified Statcmmt ivithout balancing or closing air. of the accounts The inventories are the same as those of Set VIII, April ist — Bought of J. R. Marvin, on acct., Goods .ns per invoice, $700. Bought of Jones & Co, on our note at 3 months, with interest at 9 per cent., Mdse. as per invoice, $2500. 2 — Sold Robert Carey, on acct., 2 pieces Scotch Tweed, 35 yards each, at $1.50; 4 pieces Cassimere,] 30 yards each, at $2. 4 — Bought for Cash, 10 pieces Factory Cotton, 60 yards each, at loc. .Sold C. A. Langford, fori his Note at 2 months, with interest at 10 per cent., 2 cases Prints, 150x5 yards, at 15c.; 3 casesl Irish Linen, 1280 yards, at 25c.; i case Scotch Tweed, 450 yards, at $1.50 ; i case Broadcloth,| 175 yards., at $4. Cash Sales this day, $134.75. 6 — Shipped per Steamer "Alexandria," and consigned to B. Way, Picton, to be sold on our acct.,| 8 pes. Broadcloth, 20 yards each, at $4 ; paid freight on same, $6.50. Cash Sales, $I36.20.[ 8— Sold Real Estate for 81250 ; received in payment Draft at 15 Days on Thomas Davis for $850;! cash for balance $400. 9— Gave W. McKay Draft at 30 days on James Goodwin for $287.50. Cash Sales, $195. 10 — Received from Robert Carey, Cash on acct. $100. Sold A. Diamond, for Cheque, 4 yards Blactl Broadcloth at $5 ; 3 yards Scotch Tweed at $2 ; i Vest Pattern, $5,. Cash Sales this ml I230.15. 12 — Bought of Henry & Co., 20 pieces Red Flannel, 40 yds. each, 30c.; 10 pieces Wincey, 30 yardil each, at 25c.; gave in payment Sight Draft on H. Simmons for $269.50 ; Cash for balance.1 Cash Sales, $200. 14— F. Lane withdrew on private account, $150. Paid Gas Bill $14.50; Taxes, $45.70. C(J.| Sales, $170. 16— Received from B. Way, Picton, Account of Sales of Mdse. shipped him 6th inst , the nJ proceeds received per Cheque amounting to $760.75. 17— Sold S. Edsall, on his note at 3 months, 4 pieces Summer Tweed, 35 yards each, at $1.50 CH Sales, $180. 18 — Had S. Edsall's Note discounted at Montreal Bank ; discount oflf at 7 per cent. $ ; Cas!| received 8 • Paid Cash for a bill of Mdse. bought at auction, $75.20. 20 — Paid Clerk's salary, $140 ; for Sundry Expenses, $18.50. 21 — Bought for cash, from T. J. Claxton & Co., Mdse., as per invoice, .?I200. Paid for Cartapj $1.50 ; Sundry Expenses, $9. Cash Sales, §245.50. 22— Bought of J. G. Mackenzie & Co., Mdse., as per invoice, $800; gave in payment ot| Acceptance at 5 days, $550 ; cash for balance, $250. Cash Sales, $725. 23 — Bought of J. McKay, for Cash, Mdse., $150. J. S. Miller withdrew on account $200. Cail Sales this day, $475.50. 26 — Paid Cash for our acceptance of 22nd inst., favor J. G. Mackenzie & Co., $ . Cash Salti I695-40- *Il is the custom of Banks when a Note bearing interest is discounted, to compute the interest for the full timeij the face of the Note, and add it to the principal, then discount the amount. In this case, Jackson's Note bears inteiy at 7 per cent, for 184 days, and will amount, when paid, to $828.23. The discount on this amount for the 61 daysir Note has to run before it becomes due, at 7 per cent., is $9.69, and this deducted from $828.23 leaves $818.54, '1^" proceeds received from the Bank. 99 30— UouKht for Cash, of T. Anderson, Mdse., 9ioo. I'aid for Insurance, i?i 47 5- Cnrtage, 93.20. Cash Salts, ^480.25. Make out a Balance Shtet at the end of thi% Set after the form on pazegt. Rule it /or two fivtners. RESOURCES AND LIBILITIES NOT SHOWN ON THE LEDGER. Rksources.— y>/ '> • II <& S" rs pa .« >-. O c4 O o »a O *: :§ ^ « N o6 a> ii» ,r H » oJ"? "S ^ B V U S 5? '^ .•" -' >00 Jf. o o 1/1 C V t/} _4 s "O a t N h .c & o K-. • O V |: ^ u "o > a„ N 00 • J33 -8 o I 9 d 111 CQ < < MxX' ^ CD d> I (0 CQ 2 u n I 'f*> •3 ^-^ o.iiH M i/i C N O N 't o s J ~»K »^iC ON ^> S SOS .a o U1 ON " a 3 C/3 8§ s «A 8 R fO 3 i 5* a t 8 CO 1^ mm Ja ^ J 00 s I 101 \n n 1 N 1 1 N T t ^ • 1 1 y, 1 » 1 » 1 b ■ t 1^ a m e W Vi o^ "8^ §• 88 «0 o^ 9Q t^ > 00 00 f$ 03 c v < ICn c 1 <« i« u ^S uo ^ 1 . 1 •31 s Sffl o o^- El ^u i cf %A 1 J ej lOt>i g = ^ V^ i^. a S 1 • UlsPaya Note, b. I 1 . 1 • s ^3 Ml g ^& e« §*i u ed s in m N iTl > m •— * vo Z: c u E > 1 521^ ■I' 33 m at' o t (A ^ 0" "3 II p ^ d} ri = 2-= P"J 1 t Ul IS m OJ'J. * c: ■2 Oi h^ I' ^ » >0 vg^ 'n 00 o 00 o\ fO ro ■* O I r. r- a ^ f*» V ft ro 102 REMARKS ON SET XI. This Set is intended to illustrate a very practical form of keeping accounts ; also some of the most important changes that take place in a partnership business. For this purpose it is continued four months, earh month representing, so far as the closing of the books and the a^reenunts ol the partners are concerned, a year's business. At the end of the first year (represented by January), the existmg partners, "Student" and "S. (i. Heatty," admit a new partner, who is to share in the gains and losses according to capital invested. It is a settled principle in accounts, that I whenever any change in the business occurs, the existing Resources and Liabilities of the concern should be made apparent ; and, consequently, the proprietors' accounts should represent their investment at the time of the change. It is evident that if the accounts are all left in their current condition at the time of admitting a partner, he will unjustly become a joint partner in the gains which accrued before he had anything to do with the business. Therefore, before admitting a new partner, it becomes necessary to credit the original partners with their respective gains during | business. With this view we close the books at the end of January, credit each partner] with his net gain, and bring down the balances as instructed on page 75. At the end of the second year (represented by February), another partner is admitted, and the business changed from that of a Retail Grocery to a Wholesale! Grocery and Shipping Business. During the third year one of the partners disposes of his interest in the business] to an outside party, who is allowed to assume the position of the retiring partner. Through a disastrous fire at the end of the fourth year, the store and goods arel entirely consumed, nothing being saved but the books and valuable papers. Thel accountant is required to effect a settlement with the Insurance Company, coUectl all Resources and pay ofT all Liabilities, as the partnership is to be dissolved and the| business discontinued. BOOKS USED. The books necessary for this Set are Journal Day Book, Invoice Book, Cash Book, Bill Book and Ledger, and as there will be a large number o(| accounts, you will keep an Index for the I^edger. A decided improvement in the Journal Day Book of this Set relates to thel keeping of a column exclusively for credit sales of Merchandise, whereby the Journall and Sales Book are combined, and an opportunity afforded to post all credit sales of Merchandise in total. The Invoice Book and Cash Book are used as books ol original entry. The transactions of the Invoice Book are journalized from that boolJ at the end of the month, and the transactions of the Cash Book are posted directl;| to the Ledger. See forms of Journal Day Book, Invoice Book and Cash Book immediately aJU^ the transactions for January. 103 (Its ; also ;8S. For r as the a year's partners, the iiflm unts, that ibilities of I accounts ;hat if the I artner, he e he had )artner, it ins during SET XI. SI'ACK kKgUIKEI) FOR LEIiOtR ACCOIJN'IS, Partners, J4 /'V '"<'^'' Merchandise^ Bills Receivahle, liilh /'uviiNc, Interest, A. Overe/l, S. Edsa//, A, Forin, Merchants Bank, Cash, a jcho/c /la^e each, ll'ni. Drewry, R, D. Ani;/in, Jos. Allen, /»', Ponton, John Laird, T. Ji, Dean, Expense, Salary, Rent, Rimmcr, Gunn Cs^ Co., Charges, Commission, J. \V. Dickie, P. V. Dorland, IV. B. Robinson, one half page each. Loss and Gain, two pages ; and all other accounts one third of a page each. RETAIL GROCERY UUSINESS. (two partners.) Gains*and Losses to he divided in proportion to Capital invested. Hamilton, January \st, 1894. ncE Book, number oil ates to thtl the Journal] edit sales IS books n that booi ited directlj ^diately aM * ftnd S. G. Beatty this day form a co-partnersl\ii) as per articles of co-partnership, for the purpose of conducti ^ the Retail Grocery Hiisiness, renting from Wm, Lottridye, Store No. 62 Macnab street, at .$600 per year. ISi'UDKNT invests Cash, $3,Soo ; Merchandise per inventory, $2,500 ; George Stinson's Note at three months, from October loth, 1893, w'th interest at 6 per cent, per annum, $500. Interest accumulated to date, $ . A. Hamilton owes on account, $250. John Smith owes on account, $100. \UabUities — Note favor VV. Brown, $500, at 6 months, from October 12th, 1893. T. Durham on account, $275. |S. G. Beatty invests Cash, $5,500. Note against W. Flemming, $1,750 at 6 months, from October 1st, 1893. 2— Engaged A. Overell, Alex. Forin, S. Edsall and John Laird as clerks at $300 each per year. Sold Wm. Drewry, on account, 3 lbs. Japan Tea at 70c., 10 lbs. Soft Yellow Sugar at 9c., i lb. Cloves, 60c. Sold K. D. Anglin, on account, 10 lbs. Java Coffee at 40c., 2 boxes Layer Raisins at $3.25, 2 lbs. Pepper at 30c. Cash sales, $96. 3— Bought of Rimmer, Gunn & Co., Montreal, on 4 months' credit, 5 bags Java Coffee, 142, 135, 136, 117, 150 lbs.; tare 15 lbs. each, at 33c. Paid freight on above, $4.25. Sold Jos. Allen, on account, 100 lbs. Dry Cod, $6, 12 lbs. crushed "A" Sugar at lo.^c. Deposited in Merchants Bank $ 1 500. Cash sales, $110. 5— Bought of James Gunner & Co., Montreal, on 4 months' credit, 10 bbls. Canso Herrings at $3- 5°. 5 l>bls. Round do at $3, 4 barrels White Fish at $5. Paid freight, $2.50. Paid E. Harrison for set of Books for use of store, .$10 50. Sold S. Edsall on account, 5 gallons Standard Syrup at 50c., 10 lbs. Sugar at loc. Sold O. Vandervoort. on account, 2 bbls. Golden Syrup, 36 gallons each, at 45c., 2 bbls. Crushed Sugar at .^25, 4 boxes Valencia Raisins at $3 25. Sold W. Ponton, on account, 5 lbs. Ground Ginger at 30c., i lb. Pepper 25c,, 12 lbs. Prunes at 20c. Received from A. Hamilton, on account, his Note at one month for $100. Cash sales, $145. 1 7— Bought of J. Carruthers & Co., Kingston, at 30 days, 20 bbls. No. 2 Sugar, 220 lbs. gross, tare, 15 lbs. each, at 9^c. Paid freight, $4.60. Sold R. D. Anglin, I bbl. Sugar, 220 lbs. gross ; tare, 20 lbs., at 12c. Sold A. Overell, 2 lbs. Tea at 95c. Sold Wm. Drewry, 20 lbs. Dried Apples at 15c.. I bbl. White Fish, $7. Sold Alex. Forin, i lb. Tea, 90c., i lb. Candies, 50c. Cash sales, $186. * Student's name. Note. — Consider all sales effected on account, unless settlement be mentioned in the e. ry. mj c : ^^ ■-" 104 8— Bought of S. E. Shibley, on our Note nt 60 days, with interest at 7 per cent, per annum, 100 bush. Apples at $1.25, 40 bush. Chill Potatoes at 50c., 50 bbls. Extra Flour at $6.10, lobbls, Mess Pork at $15.50. Accepted J. Carruthers & Co.'s draft at 30 days, from the 7th inst., for amount of invoice and % per cent, exchange. .Sold Joseph Allen, 2 bushels Apples at $1 50, 2 lbs. Rice at 25c. Paid for repairint? .Store, $25. Remitted Rimmer, Gunn & Co., Cash for their invoice of the 3rd inst., less discount at 2i per cent. Discount $ — . Cash remitted, $— . Received of A. Hamilton, on account, $20. Sold John Laird, on account, 25 lbs. Salmon at I2C., ID lbs. Raisins at 25c. Sold T. B. Dean, on account, 14 lbs. Sugar at 12c., 5 lbs. Dried Apples at 20c. Deposited in Merchants' Bank, $1000. Cash sales, $250. 9— Bought of Pitceathly & Kelso, Belleville, on 3 months' credit, 20 bbls. Mackerel at $5 ; 6 bbls, Trout at $8. Paid Cash for Freight, $12.50. Received of O. Vandervoort, his Note at 90] days, bearing interest at 7 per cent., for goods sold him the 5th inst. Bought of Sinclair, Jack & Co., Montreal, on 2 months' credit, 5 half chests " Uncolored Japan " Tea, 75, 76, 78, 77, 79 lbs gross, tare il lbs. each, at 56c. ; 4 half-chests Young Hyson, 78, 86, 75, 73 lbs., tare 9 lbs. each, at 74c., 5 boxes Pr. of W. Tobacco, 120, 125, 130, 132, 136 lbs., tare 16 lbs, each, at 30c. Paid Freight in Cash, $13.60 Sold Joseph Allen, i chest Tea, 130 lbs., at 90c, Sold Wm. Drewry, 55 lbs. Pr. of W. Tobacco at 45c. Sold S. Edsall, 3 lbs. Gunpowder Tea| at 90C., 3 dozen Nutmegs at 150., i bush. Onions at $1.75. Cash sales, $238. 10 — Had O. Vandervoort's Note discounted at Merchant's Bank at 8 per cent, per annum, discount, $— . Cash received, $—. Paid Cash for Sundry items of Expense. $2240. Sold John Laird, 12 lbs. Prunes at 20c., 5 lbs. Raisins at 25c. Sold T. B. Dean, i bush. Apples, $1.50, 2 lbs. Raisins at 25c, Sold Alex. Forin, 2 lbs. Macaroni at 20c., S Jars Coffee at 80c. Cash sales, j .|I74. II — Sent Pitceathly & Kelso our Note at 3 months, with interest at 8 per cent., for their invoice oil the 9th inst. Paid Cash for Stationeiy and Stamps, I4.80. Sold W. Ponton, 15 gallons .Syrup at 40c., i lb. Tobacco, 50c, Sold A. Overell, 4 lbs. Candy at 50c., I lb, SS. Almonds, 55c. Received of John Smith, in full of account, Cash, $50, and his Note at 30 days, with] interest at 8 per cent, for balance, $ — *. Cash sales $276. 12 — Bought of A. Urquhart & Co., Montreal, on 4 months, i^. casks Bordeaux Vinegar, 50 gals, each, at 35Cm 5 cases Eleme Figs, 430,32 ; 426,27 ; 298,31 ; 460,30 ; 389,32 lbs.,t at i6c., 10 bagsj SS. Almonds, 130,5 each, at 21c., 100 boxes Layer Raisins at $2.25, 5 bbls. Zante Currants, 256,31 ; 293,27 ; 269,29 ; 256,27 ; 298,31 lbs. at f,% cents. Paid Freight in Cash, $22.40. Sold T. B. Dean, 4 lbs. Tobacco at 50c., 2 dozen Nutmegs at 30c. Paid A. Overell Cash, ^,\ John Laird. $3.50, S. Edsall, $4.50, Alex. Forin, $3. Cash Sales, $236. 14 -Received Cash in full for George Stinson's Note of October loth, with interest. Sold Wm, Vickers, at 30 days, 10 boxes Layer Raisins at $2.50, i bbl. Zante Currants, 293,27 at 6^c., i| bag SS. Almonds, 130,5 at 24c., i box Pr. of VV. Tobacco, 120,15 at 35c. Sold W. Ponton, I case Eleme Figs, 210 lbs., at i8c., i bbl. Zinte Currants, 233 lbs., at 6ic. Sold A. Overell, 20 lbs. Prunes at 20c. ^ Cash sales, $249. 15- Received from W. Vickers, his Note at 30 days from the 14th inst., for amount of goods sold] him. Bought for Cash, 10 reams of Wrapping Paper at 95c. (charge expense.) Sold T. B. Dean, 4 lbs. Coffee at 30c, Received of VV. Ponton, on account. Cash, $20, Wm. Drewry, $15, R. D. Anglin, $10. Paid S. Edsall, $9. Paid Sundry Expenses, $4.40. Had W. Flemming'si Note of October ist discounted at Merchants Bank, at 7 per cent, per annum. Cash sales, $275. 16— Bought of J. H. R. Molson & Bros., Montreal, on 3 months, 10 bbls. Crushed "A" Sugar.l 246,19; 238,20; 246,21 ; 232,19 ; 268,17 ; 262,17 ; 238,18; 258,17 ; 293,22 ; 246,19 at I2jc,, 5 bbls. Golden Syrup, 43, 44, 45, 46, 49 gals, at 6ic. Paid Freight on above, $5 60. .Soldi W. Ponton. I bbl. Syiup, 44 gals, at 70c, Sold S. Thompson, 15 gals. Vinegar at 40c. I Discounted our Note favor VV. Brown, at 7 per cent, for unexpired time. Paid T, Durham od| account, $45. Cash sahs, $268.40. 17— Sold R. D. Anglin, i bbl. While Fish, $12, 2 lbs. Tobacco at 50c. Cash sales, $196. 18— Deposited in Merchants Bank, $850. Paid Cash for Tax Bill, $15, Gas, $25, Coal, $20. Soldi John Laird, 20 lbs. Sugar at 13c. Received from Jos. Allen, on acct., $50. Cash sales, $245. ♦ As soon as an entry of this kind is posted, the account should be ruled up in the Ledger, in order that it may not 1*1 brought in the Trial Balance at the time of closing, or use letters to show balance as explained under the head " To sho»| settlements in Ledger accts. without ruling." t The large amounts are the number of lbs. gross, and the sm.ill amounts to the right, separated from them byl commas, are the lbs. tare allowed. ^Tef Gain, \ *Inorder toascertj ount realized for eacl |reh.-iridise .sold subtr Note.— As an addi fssary to post all trai Jition of the business Pg lliem down under "ght down with the P'ct this. 105 nutn, 100 ), lobbls, 1 inst., for iat?i,5o, , Cash for itted, $-. Salmon at lbs. Dried 5 ; 6 bbls. I iote aJ 90 !iclair, Jack | 76, 78, 77. lbs., taiegl 6 lbs. each, | •s., at 90c, powder Tea I n, discount, John Laird. 11.50, 2 lbs. Cash salcs,\ ;ir irjvoice ol , 15 gallons S. Almonds, ) days, with :o gals, each, 6c., 10 bags Ue Currants, I ash, $22.40.1 ell Cash, I5, 1 Sold WraJ 27 at 6^0., 1 1 \V. Ponton, I i A. Overell, 19-Discountea Sinclair, Jack & Co.'s invoice of the 9th inst. at 3>^ per cent, and remitted amount per Draft on Bank of Montreal, for which we paid cash (without exchange). Received from A. Hamilton Cash in full oi account. Cas/i Sa/cs, $210.40. 21— Sold \Vm. Drewry, 40 lbs. Supar-cured Ham at 15c., 20 lbs. Mess Pork at 12c. Deposited in Merchants' Bank, $400. Cash Sales, $260. 22-Paid John Laird, Cash, $4.50 ; S. Edsall, $2.40 ; Alex, l^orin, $3.60 ; A. Overell, $2.00. Cas/t Saks, $174.60. 23-Received from Wm. Drewry, on acct., $10. Sold R. D. Anglin, I bbl. Sugar, 216 lbs., ni ijjr. Sold Joseph Allen, i bbl. Mess Pork, $16. Sold T. B. Dean, 10 bush. Apples, at $1,40. Cas/i Saks. $172. 1 24— Deposited in Merchants' Bank, $386. Accepted T, Durham's Draft on us at 30 dayis, fivor J. W. Campion, for balance of his acct. Sold M. Lingham for Note 60 Days, i cask Vinegar, 40 gals., at 40c , 10 bush Apples, at $1.45, 50 lbs. Sugar at 14c. Cas/i Saks, $268, I25— Paid for Repairing Store, $20 per Cheque. Lent G. J. Sherry, $120, for which he gave his Note at 30 days, with interest. Sold Wm. Drewry, 5 lbs. Japan Tea at 9Sc. Cas/t Saks, $164 J26-Student drew on private acct., $250. Deposited in Merchants' Bank, $430. Sold R. D. Anglin, 30 lbs. Sugar-cured Ham at 15c. Cas/i Saks, $167. [28—8. G. Bealty drew on private account $167, i lb. Tea, 75c., 3 bush. Apples at $1.25. Cash Saks, $146. 29— Bought of Ross & Davies, for Cash, 10 bbls. Herrings at $5.50. Sold W. Ponton, 25 lbs. Dried Cod at I2c. Cash Saks, $100. 30— Received of Joseph Allen, on acct., $75. Paid A. Overell, $4. Cash Saks, $176. 31-raid Alex. Forin, $3 ; S. Edsall, $2. Cash Saks, $260. Open a Salary Account, and pass the amount of clerks' salary, for month, to Iheir credit. Make Rent Account Dr. to the Landlord for one month's rent of store. As you are now to admit a new partner, it is necessary to ascertain the condition bf the business, which you may suppose has been running a year, balance the [ccounts, and bring down the balances, deal with Loss and Gain, and make out the Balance Sheet. Allow a profit of 25 per cent, on sales, in order to ascertain the inventory of Merchandise.* Net Gain, $Tjg.si. c : f goods soldi Sold T. B.' Drewry, $15>1 Flemming'il ■A saks, $275J "A" Sugar, I ,19 at I2jc„ $5 60. Soldi legar at 40c I Durham od| ^6. I, $20. Soldi h saks, $2M at it may not 1x1 head "Tosho» from them 1)) JOURNAL DAY BOOK. The form of Journal Day Book used in this Set is similar to that of Set IX., Kcept that the outside column is used exclusively for credit sales of Merchandise. his form is very practically and extensively used in large retail houses. It combines |e Journal and the Sales Book in one, and affords an opportunity of posting the sales Merchandise in monthly totals. The column containing credit sales is forwarded the end of the month, and the Cash Sales, from the Cash Book, added to this lount, gives the total sales, as illustrated in the following form. * In order to ascertain the value of unsold Merchandise, divide the credit side of Merchandise Account by $1.25, the lount realized for each dollar of the cost, and the quotient will be the cost price of all Merchandise sold. The cost of ^rch.indise sold subtracted from the cost of Merchandise bought will leave the cost price of unsold Merchandise. Note. — As an additional partner will be admitted into the business at the beginning of the ensuing month, it becomes wssary to post all transactions up to the present time, take olf a Trial Balance and Ualance Sheet to ascertain the dition of the business, and close all accounts in the Ledger ; but instead of transferring balances to Ualance Account Ig them down under their respective accounts, writing " To " or " By Balance " in black ink. Compare the balances light down with the resource and liability columns of the balance sheet, with which they should agree. Never feet this. ♦ ; 106 112 C. H. 114 "5 118 H5 »«5 112 "5 120 "3 C. B. "5 121 123 121 125 124 »3o JOURNAL DAY BOOK— Set XI. Hamilton, January is/, 1894. and S. G. Beatly have this Jay entered into co-partnership, to carry on the Retail Gro- cery business, as per Articles of Agreement, rent- ing from William Lottridge, Store No. 62, Mac- Nab St., at $600 per year. Sundries Dr. To Student For effects invested. Cash Amount invested as per C. B Merchandise " *' " Inventory Bills Rcc G. Stinson's Note as per B. B . . . Interest Accrued on above Note to date. . . A. Hamilton Owes on account John Smith " '• " Student Dr To Sundries For liabilities assumed by firm. Bills Pay., Note favor W. Brown for T. Durham, Bal. of acct assumed Sundries Dr. To S. G. Beatty For effects mvested. Cash As per C. B Bills Rec, VV. Flemming's Note as per B. B. Engaged A. Overell, A Forin, 8. Edsall & John Laird as clerks, at $300 each per year. 2 Wm. Drewry Dr. to Mdse. For 3 lbs. Japan Tea at 70c •' 10 " Soft Yellow Sugar at 9c. " I •' Cloves R. D. Anglin, Dr. to Md.-e. For 10 lbs. Java Coffee at 40c . . " 2 bxs. Layer Raisins at $3.25 . " 2 lbs. Pepper at 30c 3 Joseph Allen, Dr. to Mdse. For 100 lbs. Dry Cod at 6c ... , " 12 •• Crushed "A "Sugar at io>^c... 5 S. Edsall, Dr. to Mdse. For 5 gals. Standard Syrup at 50c. " 10 lbs. Sugar at IOC O. Vandervoort, Dr. to Mdse. For 2 bbls. Golden Syrup, 72 ^als, at 45c. . . *• 2 •• Crushed Sugar at $25 " 4 boxes Val. Raisins at $3. 25 W. Ponton Dr. to Mdse. For 5 11)8. Ground Ginger at 30c *• I lb. *' Pepper " 12 lbs. Prunes at 20c Amounts forwarded. «7i56 81 ajsoo 2500 SCO 6 00 00 00 81 250 100 00 00 775 00 500 275 7250 5500 I7SC 00 00 3 60 II 10 7 26 . 3 SO 95 40 4 '5 * 15306 K2 $15181 81 Merchandise Note.— With e.-ich entry in the Journal throughout the XI Set, there must be full explanations. 32 '3 $125 10 90 60 This is book record lost or destn saves a greal some descrii to this book, by seeking t In somi numbered, a reference. J side of Merc direct and p This book is I^r. to Sundi dollar and c( seller, write unless boug month is the each Invoice Ledger folio Merchai Cash Book. When the name of tions, and th The twc^ I and sums tot Cash purchai I Invoices I should either Day Book, ai from other c( 107 i894- lerchandisi: 10 1 90I (Ml 32 «3 U $125 Hamilton, yanuary $9 01 $15181 100 199 70 389 605 148 389 *I49 81 00 65 00 5° 00 00 04 01 01 Merchandise. 125 24 01 R. U. Anglin Ur. To Mdse. I'ur I bbl. Sugar, 200 lbs. net, at 12c . <• 00 Merctiandise Ur. To Sundries, Invoices from the Invoice Book. Folio 108 To Rimmer, Gunn & Co., invoice of Jan. 3 " James Gunner & Co., " " 5 " J. Carruthers & Co., " " 7 " Bills Payable, " " 8 " Pitceathly& Kelso, " "9 " Smclair, Jack & Co , " " " * Merchandise Cr. by Sundries. • Red Ink. 114 149 01 ! $17232 4 , 0) 6 50 60 6 CO 1 26 2 5« I 00 The foregoing form is considered sufficient to illustrate the mode of entering transactions in this Journal, It will be observed that Cash transactions are not entered here, but carried into the Cash Book. Purchases of Merchandise are entered first in the Invoice Book and Journalized at the end of the month. INVOICE BOOK. This is a book in which to copy all bills of goods purchased, in order to have a book record of the details of such transactions, in case the original invoice should be lost or destroyed. This is practiced by some merchants ; but it is as convenient, and saves a great amount of writing, to paste the original invoices into a book made of some description of paper of a larger size than the invoices. By means of an index to this book, it will be found more convenient to refer to the original invoices than by seeking them from files. In some business houses, where the invoices received are long, they are filed and numbered, and only an abstract of them entered in this book, with the number for reference. In whatever form the Invoice Book is kept, every entry affecting the debit side of Merchandise account should originate here ; when this is done, it becomes a direct and perfect check upon the Dr. side of Merchandise account in the Ledger. This book is journalized at the close of the month, under the heading " Merchandise Dr. to Sundries," or you may post directly from it into the Ledger. In that case rule dollar and cent columns on the right, fold each Invoice neatly up to the name of the seller, write the explanation underneath each, carry the amount into the column, unless bought for Cash, carry forward each column. The footing at the end of the month is the amount to make Merchandise Dr. for. After debiting Mdse., credit each Invoice to the individuals or Bills Payable, as the case may be, and put the Ledger folio on each Invoice in red ink. Merchandise purchased for Cash is entered in this book, but posted from the Cash Book. When a Cash purchase is entered, mark " C. B." in the folio column opposite the name of the seller, in order that it may not be journalized with the other transac- tions, and thereby posted twice. The two sets of columns for dollars and cents on the right are used for extensions and sums total of purchases on time ; a thii J, or inside, column may be ruled for Cash purchases. Invoices of goods to be sold on commission are not entered in this book ; they should either be kept in a separate book, or a memorandum of them made in the Day Book, and the invoices ^led away for reference. Merchants who import goods from other countries keep a Foreign Invoice Book, in which they enter all goods • 108 purchased in foreign countries, and a Domestic Invoice Book for copies of all invoices of Merchandise purchased from persons in their own country. Want of space prevents us from giving more than a few of the first purchases in the form of Invoice Book below ; but those given are cnnsidv red sufficient to show how the entries should be made. When an invoice in a foreign currency is received, you may deal with it in two ways. In the case ot a Sterling Invoice, for example*, vou may count it at the present rate of exchange, debit Mdse. account, and credit the firm from which you purchased ; and if, when you settle for it, exchange is higher than you estimated, charge Mdse. or Discount with the difference, or, if it is lower, credit it. The other way is to post the Invoice, leaving the figures blank until you have ascertained the actual cost. INVOICE BOOK— Set XI. Hamilton, /anuary ist, 1894. Marks. Nos. D. B. sj n/ V V •J •Red ink. Mdse. invested by Student as per Inventory Book, _3 Rimmer, Gunn & Co., 5 bags Java CofTee, lbs. tare. 142— 1 5 over 413—45 >35— >') ii7-«5 136-15 150-15 413—45 680— 75 = 605 at 33c. 4 months' credit, or 2^ per cent, off for Cash. 5 Monlreat, James Gunner & Co , 10 bbls. Canso Herrings at $3. 50 5 " Round Herrings at $3 00 4 " White fish at $5.00 4 months' credit. 7 Mum leal. |. Carruthers &. Co., 20 bbls. No. 2 Sugar, 4400 lbs. gross, 300 " tare, Kmgsion. 30 days' credit, 4100 8 net, at 9>^c. S. E. Shibley, 100 bus. Winter Apples at $1.25 40 " Chili Potatoes " 0.50 50 bbls. Extra Flour *' 6.10 10 '* Mess Pork " 15.50 Note at 60 days. 9 lielleville. Pitceathly & Kelso, 20 bbls. Mackerel at $5 6 " Trout *• 8 3 months' credit. Uelleville. Sinclair, Jack & Co., 5 half-chests Uncolored Japan Tea, lbs. tare. 75— n over 229— 33 76 — II 77—11 78—11 79-11 229—33 385-55 = 330 lljs. at 56c. 4 half-chests Young Hyson, 78 — 9 over 239—27 Montreal. 86- 75- 9 73— 9 239—27 3 ' 2—36 = 276 lbs, at 74c. 2 months' credit. 'Total purchases. Journal, page 107, 2500 00 35 «S 20 125 20 305 !55 100 48 1 84 204 80 24 199 70 389 605 148 ^9 1801 00 50 00 00 04 The 01 IX is the a( This ft The cc and Freight from which These acroi posting thes writing in th depend upo should be li special cohir It will 1 the Bank ac< below. The already been After dr the extension ruling adopte out your worl of books, and persons imagi METH The Bank i and by this meai .side,— the one o one on the Cr. When enter space where the but in the explar into its own colu When enter! names of the acc^ Note No. 129, a no other entry, a l)ut for a discoun Proceeds were ha E.XAMI'LES.- of account ; the You deposit Dr. Bal. from 8 (( To B. Rec Bala Cash Bal. 109 CASH BOOK. (See form on next two pages.) The only distinction between the following form of Cash Book and that of Set IX is the adoption of a greater number of special columns. This form of Cash Book will be found applicable to almost any kind of business. The columns which we use for Merchandise, Interest, Bills Receivable, Expense and Freight may be used for any other titles. Every business has particular accounts from which its principal income is derived, and for which its chief expenditure is paid. These accounts must always create a great number of entries, and any mode of posting these entries in accumulated amounts must materially diminish the amount of writing in the Ledger. The number of special columns used, and the titles adopted, depend upon the nature of the business. The special columns on the Dr. side should he headed with accounts for which Cash is frequently received, and the special columns on the Cr. side with accounts for which Cash is frequently paid. It will be found practical and very convenient to use a column on each side for the Bank account, and put all bank transactions through the Cash Book as shown below. The mode of entering transactions in this book and posting therefrom has already been explained on pages 86 and 87. After drawing the lines and posting the special columns they may be entered in the extension to the " Sundries " column, with red ink. Observe closely the style of ruling adopted for closing this book, in the following form, and adhere to it through- out your work, as neatness and uniformity in this matter add greatly to the appearance nf books, and are of more importance in preserving accuracy and order than many persons imagine. METHOD OF KEEPING THE BANK ACCOUNT IN TIIR CASH BOOK. The Bank Account is frequently kept in the Cash Book, and not optned in the Ledger at all, and hy this means a saving of time and labor is effected. You will require a special column on each side,— the one on the Dr. side for Cheques or Notes, and Drafts charged to you in the Bank ; and the one on the Cr. side for Deposits, Proceeds of Discounts or Collections. When entering Cheques, Notes or Drafts charged to you in the Bank, don't write anything in the space where the names of accounts are usually placed, as you have to make no posting to the Ledger ; but in the explanation space write, for exanr.ple. Cheque 89, or. Note No. 87, and carry the amount into its own column ; you will then make the regular Cash entry for Cash paid out. When entering Deposits or Proceeds of Discounts, don't write anything in the space where thi names of the accounts are usually placed, but in the explanation space write Deposit, or Proceeds of Note No. 129, and carry the amount into its own column. For a deposit you would of course make no other entry, as you are simply moving the money from your own office to the Bank for safe keeping, liut for a discount or collection you would make the regular Cash entry that would be made if the 1 Proceeds were handed over to you in Cash. ExAMPLF.s.— Suppose the following : You issue Cheque 89, for $150, to John Sutherland in full [of account ; the Bank has charged a Note for $153. You deposit $397 ; you discount a Note for $120, the Proceeds $118.20 are left in Bank. \Dr. Cash. Cr. iN'v Hal. from last mo. $890 Cheque 89 Note 87 To B. Rec. Dis. No. 129 Balance in Bank Cash Bal. from last mo. Bank. $150 153 00 00 120 N'v 8 it tt (1 412 20 890 $715 20 $1010 Bal. in Bank from last mo. lly J. Sutherland in full of ac. " Bills Pay, retired No. 87. Deposit Proc. of Note 129. By Discount on Note 129 Balance on hand and in Bank. Bank. $200 00 $150 00 153 00 397 Ii8 00 20 I 80 705 30 $7«S 20 $1010 00 * §1 c 1 no ; ♦ Dr. Cash. CASH. BOOK- 1894. F. To Student, Amount invested. Mdse. In'st Bills Rec. Sundries. Jan. 1 D. B. 3800 00 la (t D. B. II S. G.Beatty. •• •« | 5500 00 • * 2 x/ i< Mdse. Sales from Petty C. Ii., 96 00 ii 3 sl i( 11 <« ti <( no 00 l( S s' << II It tt II '4.S 00 11 7 si 11 II tt tt It 186 00 (( 8 si ti Discount, On R. G. & Co.'s invoice, 4 99 «i l( 98 K A Hamilton,On account. 20 00 il ti si i< Mdse., Sales from Petty C. B., 250 00 (( 9 si l( tt tt tt It 2.38 00 ({ 10 >/ II Bills Rec. , Had O.V. 's Note discount'd 95 40 it Ii ll II Mdse., This day's sales, p. C.B., «74 00 ti (1 99 II John Smith, Part Payment of account, 50 00 «( 11 si (1 Mdse., This day's sales, P.C.B , 276 c» >< 12 si II ti tt It It 236 00 (< 14 s/ II Bills Rec , G. S.'s Note of Oct. 1 1 (B. R., No.—) 500 00 t> ti si 1< Interest, On above Note to date, 7 89 i( it s/ II Mdse. , This day's sales, P. C. B. , 249 00 <( "» 94 II W. Ponton, On account. 20 00 i< (i (t 90 87 l< l< W. Drewry, R. D. Anglin >5 10 00 00 »( (t n/ II Bills Rec, W. Fleming's. Note disc'ted 1750 00 t< 5 Total to Dr., of " $14776 21 When discounting a number of notes or acceptances at the same time, and making the entries 'n Hn h R ^i! 'V"f the Cash Book, the following is a good form : W '*°^' '"* " $500. $780. $390.50 $560.20 $300 $253070! Jan. 3. To Bills Receivable. Dis. Nos. 438. 440, 443, 450, 451 ■^"•3 By Bills Then make entries on the other side of the C.B. for the discount, and the proceeds left in ■ « Extensions to the bank. *Extensio ns to Sundries column Red Ink. Ill )0K-- SET XI Cash. Cr. Sundrits. 3800 5500 00 00 20 00 50 00 2000 1500 1000 50 00 •2944 21 *2345 $14776 40 4« 40 21 I-' 94 V. :in. 3 5 i 7 s' « ^: ii ^^ 9 : 10 v' 1 1 n/ 12 74 'i ■ ( 73 70 75 '5 70 16 i • 56 Si Kh 65 61 58 Co 5' By Freiffht, On R. G. & Go's Invoice, Mer. Sank, iJeoosited, Freight, On J. C. & Co.'s Invoice, Bxpense, Set of Books for Sto) », Freight, On j. C. ft Co.'s Invoice, Dzpexuse, Repairing Window of Shop, R.Gr. & Go., In full fur Invoice 3rd inst. Mer. Bank, Deposited, Freight, On P. & K.'s Invoice, On SI. & Co.'s Invoice, Discount, On V.'s Note at 8 per cent. Bxpense, Sundry Items per P. C. B. " Stationery,$4 ; p. stamps,8oc, Freight, On Urquhart & Co.'s Invoice, A. Overell.On account of Salary, Jno. Laird, S. Bdsall, A. Forin, Bxpense Wrapping paper, 10 rms. at 9SC, On account. Sundry Items, P. C. B., On Flemniing's Note at 7 p.c. On J. H.R.Molson Bros.'Inv, Retired B. P., No.— T. DurhamOn account, Mer. Bank,Deposited, Bxpense, Taxes,$i 5; Ga.«,$25; Coal, $20 Bxpense Dr. to Cash. S. Bdsall, Bxpense, Discount, Freis^t, BillslPay. Interest k( u Freight " Total to Or. of " • Balance in hand, Exp'se. 10 25 22 4 Co 136 00 60 In'st Freight. 26 26 26 51 77 12 •3 22 65 40 60 45 Sundries. 1500 •99 1000 65 500 45 850 136 26 65 4348 * I 0427 $14776 5'- 50 00 00 00 00 60 77 45 47 74 21 VVhen retiring a number of notes or acceptances at the same time, and making the entries in the the entries in ^^^^ g^^^^ ^j^^ following is a good form : $5f« $397-50 $430.20 $600 $200 $2127.70 an. 3 By Bills Payable Retired Nos. 183, 190, 195, 184, 191. X3 $253070 r: )ceeds left in Extensions to Sundries, Red Ink, 112 •* SECOND MONTH'S BUSINESS— Set XI. Ftbntaty is/, 1894. We have this day admitted J. W. Dickie as partner, who invests, according to Articles o( Agreement, Cash $7500. Bought of Carr, Chase & Raymond, Boston, 100 half Chests E. B. Souchong Tea, 20 lbs net each at 68j^c. "Paid Customs Duty, loc. per lb. Freight, $12.50. Received of Wtn. Drewry, on account, $30. Cask Sales, $87. 2— Joseph Allen pays his account in full to date by contra account against S. G. Beatty, $15.60; Cash for balance. Paid S. Edsall, Cash, $3 50. Cash Sales, $145.60. 4— Sold Wm. Drewry, on acct., 14 lbs. Sugar at loc; i box Soap, $2 ; 2 lbs. Green Tea at 75c. Sold R. D. Anglin, on acct., I box Candles, 50 lbs. at loic; 10 gallons .Syrup at 65c. Cash Sales, $176. 5— Bought of Rimmer, Gunn & Co., of Montreal, on four months, 100 bbls. Sup. Family Flour at $5.25 ; 5 casks Soda Ash, 1540,36 ; 1532,29 ; 1564,37 ; 1429,18 ; 1612,43 lbs. at 3lc. I'aid Freight, $56. Sold VV. Ponton, I bbl. Family Floar, $6.50 ; i box Soap, $2.25. Caeh Sales, $135. 6— Paid sundry Expenses, $7.50. Sold R. D. Anglin, on acct., i bush. Dried Apples, $4.25 ; 20 lbs. Prunes at 20c. Paid Alex. Forin, Cash, $3.50. Sold W. Raymore, on account, 50 lbs. Sugar-cured Ham at 17c., 3 lbs Green Tea at 90c., 10 gals. Vinegar at 26c, Cash Sales, $174. 7— S. G. Beatty draws on private account, Cash, $50 ; 3 lbs. Tea at 60c ; 20 lbs. Sugar at gjc; 2 hbls. Flour at $6.25. Received of R. D. Anglin, on acct., $25. Lent W. R. Barber, $150. Paid our Note favor S. E. Shibley, less discount for unexpired time. Remitted A. Urquhart & Co., a Draft on Bank of Montreal for amount of their Invoice of January I2lh, less 2\ per cent. discount ; Paid Cash for Draft and X pcr cent, exchange. Cash Sales, $146. 8— Bought of Dobson & Sons, Port Hope, on 60 days, 200 doz. Corn Brooms at $3.25, 50 doz. at $2.95, and 20 dozen at $4; paid Freight, $24.50. Sold Joseph Allen, 10 dozen Brooms at $3.50; 2 chests Y. H. Tea, 67,6;4 ; 74,7i lbs. at 75c. Paid for Coal, $26. Paid W. Lottridge, for 2 months' rent of store per Check. Deposited in Merchants' Bank, $490. Cash Sales, $156. 9— Shipped per G. T. R. and consigned to C. Hutchison, Toronto, to be sold on our account and risk, 100 half chests E. B. Souchong Tea, 20 lbs. net each, at 79c.; tpaid Freight on the same per Check, $15. T. 6. Dean pays his account in full to date by contra account for repairing store, $4, and Cash for the balance. Sold S. Thompson, on account, 30 boxes Bloom Raisins at $3. Cash Sales, $179.60. II — Bought of David Cheesman & Co., London, on Note at 3 months, 16 boxes Mould Candles, 5S lbs. each at iiXc-J 3° boxes Bloom Raisins at $3 ; 2 chests Y. H. Tea, 96.7^ ; 110,12^ lbs. at 69c. Paid Freight, $12. Deposited in Merchants' Bank, $1250. Sold W. Drewry, on acct., I box Candles, 58 lbs. at ly/zC. Cash Sales, $172. 12— Received of Thomas Moore & Co., Toronto, to be sold on their account and risk, lOo bbls. Flour invoiced at $6.50. fPaid Freight on the same per Check, $15. Paid sundry items of { Expense, $9.50. Received of W. Raymore, on account, $5. Paid John Laird, $4. Cash Sales, $79. 13— Received of John Smith, Cash in full for his Note and Interest, due this day. Received of R. D. Anglin, on acct., $I2. Paid A. Overell, Cash, $3. Received of S. Thompson his Note | at 2 mos. in full of account. Cash Sales, $87. 14— Sold Conger Bros., for their Note at 3 mos., 50 bbls. Flour, from Moore tt Co.'s Consignment at I $8. S. G. Beaity draws on private account, Cash, $40, Received from C. Hutchinson an | * Charge duties to Merchandise account, as they are part of the cost. See " Duties on Goods." The Freight on purchases might also be charged to Merchandise, but it is usual to keep a Freight account, which may be closed into Merchandise, or as we do, into Loss and Gain. t Amounts paid for freight on Consignments or Shipments are not charged to Freight account but to the particular | consignment or shipment. 113 /, 1 894. Articles oi 20 lbs net I of \\m. y, $15.60; Pea at 75c. 650. Ciisk ily Flour at 3ic. I'aiil CaeA Sales, , f4-25 ; 20 unt, 50 lbs, Snlfs, $174. ir at 9ic. ; 2 uber, $i5c. Urquhart & 2^ percent. ;, 50 doz. at a Brooms at . Paid W. J490. Crsk account and on the same | or repairing loom Raisins Candles, 58 1 o,i2j lbs. at rry, on acct., 3 bbls. Flour Iry items of 1 $4. Cash sceived of R. son his Note insignment at utchinson an The Freight on r be closed into o the particular " Account Sales " of the Mdse. shipped him the 9th inst., with net proceeds, $1580.50, by Sight Draft on Bank of Toronto ; there being no agency of which in this place, it costs i per cent, for collection. Cash Sales, $156. 15-Sold R. Morris k Co., on their Acceptance at 30 days, the balance of Thos. Moore & Co.'s Con- signment at $8 per barrel. Paid sundry expenses per Check, $36. Having become dissatisfied with our clerk, John Laird, we settled with him in full to date, and discli \rged him. Cash Sales, $196. 16- Received Cash in full for W. Vicker's Note due this day. Closed Thomas Moore k Co.'s Con- signment of the I2th inst., and rendered them an '• Account Sales"; charges posted, $15 ; charges for Storage, Cooperage, &c , unposted, $12.60; Commission 3J per cent, on sales; Moore & Co.'s net proceeds to be credited to their acct. Cash Sales, $196. I iS-Deposited in Merchants' Bank, $750. Bought of J. Carrulhers k Co., Kingston, on our Accept ance at 90 days, one hhd. Sugar, 1146 lbs., tare 10 per cent., at 8Jc,; 100 boxes Soda Bibcuiis at $2.50 ; 50 boxes Wine do., at $2.75. Paid Freight, $14. Received Casti for A. Hamilton's Note with Interest for time overdue. Sold VV. Raymore, on account., 60 lbs. Cheese at I2ic. ; I box Raisins, $3.25. Cash Sales, $219.60. |i9— Sold John Templeton, 40 doz. Brooms at $4, for which he paid by contra acct. against Student, $96 ; Cash for balance. Received from R. Mason & Son, London, to bu sold on their acct.. and risk, 50 bbls. Sugar, invoiced at $20 ; paid freight, $36. Remitted James (iunner k Co., Bank Draft to balance acct ; exchange i per cent., paid cash. Cash Saltv, $158. |20- Paid Sundry Expenses, $5.50. Assumed the Sugar received from R. Mason & Son, the igih inst., at $25bbl., and shipped the same to Frank Smith & Co., Toronto, to be sold on our acct. and risk. Paid for Insurance on it $15 per Check. Cash Sales, $268. ^!-.So!d R. German, on acct., 2 bbls. White Fish at $10 ; i bbl. Vinegar, 42 gals., at 47c. Closed R. Mason k Son's Consignment, and rendered an '* Account Sales." Our Charges for Storage, Ac, 3c. per bbl.; Commission, 3 per cent, on sales ; R. Mason k Son's net proceeds, $ , settled by note at 60 days. Cash Sales, $216. p— Bought of David Cheesman & Co., London, on note at three months, i case Smyrna Figs, 165 boxes, 346 lbs., tare 73 lbs., at 14^0.; i case Eleme Figs, 40 boxes, 126,37 lbs. at u^c . Paid Freight, $16.50. Remitted Thos. Moore & Co., by bank draft the amount placed to their Cr. on the l6th, for which we paid cash (without exchange.) Cash Sales, $149. I?— Received advice from Frank Smith & Co., that they have le-shipped our Consignment of the 20th inst. to Ross & Davies, Belleville, having charged us $15 tor receiving and re-shipping. Sold S. Edsall, 16 lbs. Sugar at 12c.; i box Mould Candles, 58 lbs., at I2jc. Cash Sales, $140. J-S. G. Beatty has taken, oit private acct., 20 gals. Syrup at 50c., 10 lbs. Raisins at 30c. Paid Cash, $4, for repairing counter in store. Student has taken on private acct., 10 lbs. Figs at I2C., 3 lbs. Rice at loc., 2 lbs. Prunes at 17c. Cash Sales, $163. ^-Remitted Carr, Chase & Raymond, Boston, a Draft on First National Bank, in full for their Invoice of the ist inst., less 4 per cent, discount ; Paid Cash for Draft and ^ per cent. Exchange. Paid Cash for our Note of January 24lh. Cash Sales, $119. [-Deposited in Bank, $875. Paid Alex. Forin, Cash, $5. Cash Sales, $210. |- Received of Ross & Davies, Belleville, an "Account Sales" of our Shipment to them by Frank Smith & Co., with net proceeds, $1360, by Draft on Bank, which we leave on deposit. Cash Sales, $146.80. Inventory of merchandise unsold, $768.64, Total net gain, $1045.93. Note. — As you have completed arrangements for admitting another partner into the firm at the binning of March, and changing from a Retail to a Wholesale business, it is necessary to make out Balance Sheet, and carry the result of the Less and Gain Account to the accounts of the partners, the personal accounts are too numerous to show on the Balance Sheet, make a separate list of Im. And in the balance sheet show Personal Accounts Receivable so much on one line, and ponal Accounts Payable so much on anothe'r. Clo.se the Books the same as at the end of January, and bring down the balances. Compare the knees brought down with the resources and liabilities columns of the balance sheet. ;♦ lU REMARKS ON THE THIRD MONTH'S BUSINESS. A new and important feature in this month is the changing of the business and the introduction of the Sales Book. The books used after the change of business are, the Journal, Cash Book, Invoice Book, Salks Book, Bill Book, and LEixiKk, A form of the Sales Book and explanations thereon, will be found at the end of this month's business. The other books are kept the same as heretofore, but without the special Mdse. Col. in the Journal. The method of usin^ these books as books of original entry has many advantages over consecutive entries in the Day Book, and is adopted in the majority of large business houses, where it is essential to divide labor and avoid unnecessary writing. P'or instance, one clerk may keep the Invoice Book, another the Sales Book, another the Cash Book, and each book be so kept that posting may be done directly to the Ledger, instead of passing the transactions through the Journal. The separate depart ments of a large business may thus receive such special record as will present the facts in their clearest light. Thus, if any particular information is desired respecting purchases, all the facts can be obtained at once from the Invoice Book ; and in the same manner the facts and conditions of sales can be obtained from the Sales Book, | the receipts and disbursements of cash from the Cash Book, etc. The only objection to posting from special books directly to the Ledger is the I tendency to debit and credit the same account hvice. In order to avoid confusion in I this respect, and to make the Invoice and Sales Books as plain as possible, journalize in one entry at the end of each month the entries from them ; but post the Casli| transactions directly from the Cash Book to the Ledger. THIRD MONTH'S BUSINESS,— Set XI. March isf, 1894. We have this day closed our Retail business, and formed a partnership with P. V. Dorland, fori the purpose of conducting the Wholesale Grocery and Shipping business, renting from A. Diamond,! store No. 96 James street, at $800 per annum. Gains and losses to be divided in proportion tocapitall invested. P. V. Dorland invests .Stock of Groceries as per Inventory, $19500 ; Cash, $6000 ; Stortl Fixtures, $620. The firm assumes for him a Note of $1000, favor of George Lewis, dated Febriiarj| 28ih at 3 months. Engaged Thomas Way as accountant at S900 per year. Received from W. Drewry, Cash in full of account. Bought of Rimmer, Gunn & Co., Montreal,! on 4 months, 12 bags Rio Coffee, 136,12; 143,13)4 i 127,11^; 128,12 ; 142,14; I47.i4il 146,12 ; 139,1 1^ ; 138,12; 152,16^; 146,14^; 156,16^ lbs. at 32c.; 10 chests Gunpowdeil Tea, 150,16; 148,14; I26,i2i; I47ii3>4 » 142,16; I45.'4i; 156,17*; 143.21 ; '34.141 144,12^ lbs. at 60c.; 15 casks Bordeaux Vinegar, 46 gallons each, at 35c. Sold Smith & Cook,l Brockville, on their Note at 60 days, 4 bags Rio Coffee, 136, 12, 127, ii^; 128,12; I29.iij| lbs. at 40c. ; 5 barrels Extra Flour at $7.50 ; 2 barrels Mess Pork at $14.50. 2 — Bought of J. H. R. Molson & Bros., Montreal, on 3 months, icx) bbls. Superfine Flour at §6 50;! ID boxes "Westein Leaf "Tobacco, 115,10; 125, 12) ; 119,13; 117,11^; 116,12; iis.9lf 118,10 ; 120,12^ ; 116, 14 ; 113,10^ lbs. at 42c. Received of W. Ponton Cash in full ofaccl Sold J. Wakham & Co., Guelph, on account, 20 bbls. Apples at $3 ; 10 bbls. Flour at : 3— Received-of R. D. Anglin his Note at 3 months, with interest at 7 per cent, in full of account ij date. Bought of J Morris & Co., on our acceptance at 90 dayF, 800 barrels White Fishi $4.50 ; 50 barrels Mackerel at $6 ; looo lbs. Dry Cod at $4.75 per cwt. 4- Shipped per G.T, R., and consigned to W. R. Ross & Co., Montreal, to be sold on joint accouJ and risk, each equally interested, 400 barrels White Fish at $5 per bbl. Paid cash fii repairing Store Fixtures $75 ; sundry Expenses, $24 * Accounts are intended to run 30 days, unless otherwise specified. 'Joint Shipments lis I (—Bought of John Cook, Belleville, on 3 monthi' credit, 30o barrels Trout at 95>75 ; 60 barrels White Fiihat $4.50. Paid Freight, $Jo. S. O. lieatty, with the consent of hii partners, this day disposes of his entire interest in the business to W. I). Robinson for a certain consider- ation. 'Received from V. Hudson, Montreal, to he sold on joint account uf shipper and ourselves, ( each, 600 barrels Superior Extra Flour at $6.50. I'aid charges on same per Check on Merchants' Bank, $49.50. Sold Massie & Peterson, on thuir Note at 2 mos., 300 barrels Superfine Flour from Mdse. Co. "A." at $7.80. I J— Sold S. Moore, James Street, for his A:ceptance at 2 months, 50 bris. Troitt at iil6,5o ; 30 bris. White Fish at $5.50 ; 5 bags Rio Coffee, 136,12 ; 152,16 ; 147,144 ; 138,12 ; 156,164 Ibi., at 4cc. W. B. Robinson withdrew on account, cash $40. Received Cash in full for G. J. Sherry's Note of January 25th, with interest to date. Sold J. Farmer, Macnab Street, for Sight Draft on F. Slinson, a bill of Mdse. amounting to $540.! Sold for Cash the balance of Flour belonging to Mdse. Co. "A." at $7.90 per bbl. I9— Deposited in Merchants' Bank, ^1200. Received from J. Wilson, Godcrich, to be sold on joint account of shipper, George Moore ond ourselves, each |j, 1000 barrels Salt at $1.50. Paid Freight and sundry expenses on same per Check, .$47.50. Sold U. Eastman, on account. 500 barrels .Salt from Mdse. Co. *' B," at $2.20 per barrel. -:J:CIosed Mdse. Co. "A," and rendered Consignor an Account Sales. Our charges, 3c. per bbl.; Commission, 2\ percent, on sales. Bought of J. M. Hawley, 1000 bush. Barley at i^i.io; gave in payment Draft at 30 days, on K. Eastman for the amount. Paid Freight, ij^so. Sold N. Boulter, for his Note at three months, the balance of Salt belonging to Mdse. Co, "B,"at $2.15 per bbl. -Shipped to P. G. Close & Co., Toronto, to be sold on joint account, 150 boxes Bloom Raisins at $j ; 125 boxes Layer Raisins at $2.40 ; 75 boxes Valencia Raisins at !^3.25. Paid Freight on same, $15.30. Received from W. R. Ross & Co., an account Sales of our Shipment to them on the 4th inst., our net proceeds, $1060, received per note at 4 months. -Closed Mdse. Co. " B," and rendered Consignor and George Moore, each, an Account Sales; Our charges, 34c. per bbl; commission, 2\ per cent, on sales. Remitted net proceeds to each per check on Merchants' Bank, marked payable at par. -Remitted J. Wilson our Note at 3 mos. for our interest in Mdse. Co. received the 9th inst. Had Massie ft Peterson's Note of the 5th inst. discounted at Merchants' Bank, at 7 per cent, per annum. Received of R. Town, Kingston, to be sold on joint account, each equally interested, 800 barrels of Apples at $3. Paid charges on same, $75. —Shipped John Cook, Belleville, to be sold on our account and risk, 115 barrels Trout at $6 25 ; 40 barrels White Fish at $5. Paid Freight on same, $18.75. Had S. Moore's Acceptance of the 7th inst. discounted at Merchants' Bank at 7 per cent, per annum. Sold T. Palmer for Sight Draft on E. T. Hamley, Mdse. amounting to $1200. -Sold H. R. Mountain, London, on 30 days' credit, 150 bbls. Extra Flour at $7.25 ; 200 bbls. Spring Flour at $7 ; 1000 bbls. Goderich Salt at $1.50 ; 1000 lbs. Dry Cod, at $5 per cwt. Received of John Cook, Belleville, an Account Sales of our shipment to him on the 15th inst.. our proceeds, $525.50, which he has entered to our credit. Paid sundry expenses, $26. Remitted Rimmer, Gunn & Co., Draft on Montreal Bank, in full, for their Invoice of the ist inst., less 2}^ per cent, discount ; paid Cash for Draft and \ per cent. Exchange. Shipped J. Griffith & Co., Toronto, to be sold on joint acct. and risk of ourselves, consignees and A. Brown, each i^, 10 hhds. Sugar. 11200 lbs. net, at S^c. Paid freight on same, $44 49. Had R. D. Anglin's Note of the 3rd inst. discounted at Merchants' Bank, at 7 per cent, per annum. Sold A. B. Jones, Toronto, for Cash, 10 bbls. While Fish at §5.50 ; 12 bbls. Spring Flour at $7.80 ; 4 hhds. Soft Yellow Sugar, 1420 lbs. net each, at %\c. J. A. Mathewson & Co., Montreal, and ourselves, have entered into an agreement to buy and sell Merchandise on joint account, each firm's interest in such speculations to be equal. They now advance us Cash, $2000. to be invested in Goderich Salt under this agreement. § I' Joint Shipments and Merchandise Cos. are fully explained at pages 92 to 95. |t In transactions of this kind, where the articles are not stated, you are required to supply them. See this entry in iBook. It Study thoroughly the method of making the Account sales entry or closing entry of Mdse. Co. at page 94 ; also 1 the two paragraphs on page 94. Ill This amount has been placed in our hands for investment, we therefore treat it as a simple loan, and credit J. A. hewson & Co. for it. ■Ml « % c Ill 34— Sold I. C. Chilmnn, on hit Note at 3 month*, lao l)l>lii. Extra Super Flour at $6.15 ; 50 bb|i,| Super Extra at 86.45 ; 50 bbli. Spring Extra at 95.70. Sold W. II. Graham for Cash, an invoice amounting to 8730. 35— Received fiom John Cook hii Draft at 30 days on I'. Miles for 81000. Received from H. K.I Mountain, Sight Draft on L. W, Yeomans fur 8100, Received from J. VValthnm & Co., Cuhl in full of account. 36— Remitted J. II. R. Molsun & Urox., Draft on Montreal Dank for their invoice of the 3nd imh less 3} per cent.; paid Cahh for Draft and }>i per cent. Exchange. Taid sundry «i(pen!>es, $ic| 37— Had N. Boulter's Note of the loth inst. discounted at Merchants' Bank at S per cent, per ^ri' Isaac Raming, absent ; W. Potts, 'i day. Extra work for A. S. Paqe & Co., 6 hours Jones and 2 hours West, taking length of pipe ; i day Darnley and 7 hours Post, on old Shaft at $4 per day. 9— Received from W. W. Jones & Co., their Note at 3 months for amount of machinery delivered to them 7th instant. Paid sundry expenses, .$ 10. Remitted Frothingham & Workman Draft on the Montreal Bank for the amount of their invoice of 5th inst., less discount at 3 per cent.; paid cash for Draft and }i per cent, exchange. A. ^L SpaHord withdrew on account, $250. Foreman's Report.— Lost time : A. Winters, 'i day ; R. Jones, yi day ; I. Raming, sick ; W. West, X day. Extra work for A. S. Page & Co., 2 hours Winters, 5 hours Jones, 5 hours West, I day Darnley, I day Ewing, on Wooden Rollers, at $4 per day. Paid hands cash in full for services, as per Time Book. II— Had W. W. Jones & Co.'s Note of the gih inst. discounted at Montreal Bank, at 7 per cent, per annum, and net proceeds left to credit. Shipped to Shannonville, per order of Robert Abrams, 3 Side Hill Ploughs at $9 ; 10 Double Crook Hurlburt do at $12 ; 12 Mohawk Valley Clipper do at $9. Foreman's Report. — Lost time : Robert Jones, ^ day ; W. West, ^ day. Extra work for W. A. Foster & Co., 2^ hours Potts, on Collars; 8 hours Raming, 3J hours Everett, 4 hours Lynn, on Stave Machine, at $4 per day. 12— Delivered to W. A. Foster & Co., i Arch Door and Frame, 126 lbs. at 5c.; 5 Arch Bolts, 22 lbs. at 5c.; 5 pieces Cast Pipe, 480 lbs. at 7c.; 15 Marking Hammers at $1 ; 4 Roller Shafts (2^ inch) 376 lbs. at 7c.; 4 Cast Rollers, 1348 lbs. ai 7c.; i Hammered Shaft, 1322 lbs. at 13JC. ; 66 lbs. Washers at 7c. Sold W. R. Coleman, on account, i Cumming's Straw Cutter, $25 ; I Circular Saw Carriage with head blocks, $400. Foreman's Report.— Lost time : Winters, ^ day Extra work for A. S. Page& Co., J4' day blacksmith and helper at $5 ; 4 hours Darnley and 8 hours Post, on old boiler, at ij?4 per day. 13— Received from W. A. Foster & Co., their note at 3 months for amount of machinery delivered 1 2th inst., and had the same discounted at Montreal Bank at 7 per cent., proceeds left to credit. Remitted W. & F. P. Currie & Co., Draft on Montreal Bank in full for their invoice of the 5th inst., less 2^ per cent, discount; paid for Draft and J per cent. Exchange per Check. Foreman's Report.— Men all put in full time. Extra work for W, A. Foster & Co., i day Fiaser, 8 hours Hudson, 7i hours Grass, on Wooden Rollers at $3 per day. 14— Delivered by order of Robert Abrams, at Madoc, 14 Scotch Canadian Ploughs at $10 ; 10 Side Hill do at $8 ; 4 Maple Leaf Cooking Stoves at $30. Bought of Frothingham & Workman, on our acceptance at 10 days, invoice of iron amounting to $1200. Foreman's Report.— Lost time : Winters; J day ; Liddell, J day ; Ewing, i day ; and Petre, i day. Extra work for W. W. Jones & Co., 5 hours blacksmith and helper, 7 hours Jones and 4 hours West, on connecting boilers at $4 per day. c 124 ;♦ : 15 — Received Cash in full for James IJrown's Note of December nth. Received from Robert Abrams, on account, J. Johnson's Note for .$250, dated April 12th, at 3 months, with interest at 8 per cent. .Sold W. R. Coleman, on account, i Iron Horse Power (for 2 horses), .^30 ; i Band Wheel for same, ^$ ; i Steel Plough, $12. Having berome dissatisfied with our blacksmith, A. Winters, we have paid him in full, including to-day, and discharged him. Forkman's Report. — Lost time : Liddell, }4 day ; Ewing, }^ day ; Long, ^{ day ; and .Spring, }< day. Hxtra work for A. S. Page iS: Co., I day Roberts, 6 hours Long, 4 hours Sprinp, on Wooden Rollers, at $3 per day. 16— Received from A. S. Page iV Co., their Note at 3 months for the followintj machinery delivered to-day : 4 Saw Arbors (2^ in.), with Pulleys and Collars, 354 lbs. at Sc. ; 4 Bevel Wheels (2i in.), Shafts and I'inions on same, 73S lbs. at Sc. ; 4 Pillar Blocks for 5^ in. Shaft, and 4 do for 7 in. Shaft, 2738 lbs. at 8c.; i Hammered Shaft, 7 in., 1490 lbs. at laic Had J. Johnson's Note of 12 instant discounted at Montreal Bank, at 7 per cent., and proceeds left to Cr. Bought of Frothingham & Workman, Montreal, on account, invoice of Bar Iron, amounting to $1500. Paid freight on same, $53.20. Foreman's Report. — Lost Time : Grass, i day. and Hudson, J day. Extra work for W. A. Foster iS: Co., 8 hours Jones, 2 hours West, 6 hours Darnley and 7 hours Post, on connecting rods, at $4 per day. Paid our hands in full as per Time Book. iS— Robert Abrams has returned i Reynolds' Water Wheel, .$68, sent him 6th instant, and 5 Double Crook H. Ploughs at -$12. Bought of W. iS: F. P. Currie iS: Co., Montreal, on account, invoice of Scotch Pig Iron amounting to §850. Paid Freight on same, §57.60. Engaged Peter Huff, blacksmith, at !ii!2 per day, services to commence to-morrow. Foreman's Report. — Lost time : Lynn, ^ day, Extra work for A. S. Page & Co., 4 hours J'ost, 6 hours Everett, 2 hours West, and i hour Davis, on connecting rods, $4 per day. 19— Received from W. W. Jones & Co., their Notes at 3 months for the following machinery delivered to-day : 2 Steam Boilers, 14 x 5 feet, at $1,500 ; 2 Globe Check Valves (2.J in.) at $5 ; 4 Globe Check Valvps at $3.30 ; 2 Butting Chains, 240 lbs., at 12c.; 2 Sawdust Grates, 174 lbs., at Sc. Received from Robert Abrams, Cash on account .^100. Foreman's Report. — Lost time: Jones, i day. Extra work for A. S. Page & Co., 8 hours Liddell, i day Ewing, I day Petrc, 5 hours Davis, on connecting rods, at $3. 50 per day ; 4 hours Darnley, 8 hours Post, and 5 hours blacksmith and helper, on pumps and connections, at $4 per day. 2C — Had A. S. Page & Co.'s Note of the i6th inst. discounted at Montreal Bank at 7 per cent. Discount § — . Cash received •$— . Shipped per order of R. Abrams, 4 Reynolds' Water Wheels at §75 ; 6 Sellick's do at $100 ; i Excelsior Hor.se Power, $Ho. Foreman's Report. — Lost time : D. Liddell and A. Ewing, i day; T. Petre, }{ day. Extra work for W'. A. Foster & Co., 4 hours Davis, 7 hours Jones, i day West, and i day Darnley, on connecting rods, and keys for same, at .?4 per day. 21 — Had W. W. Jones & Co.'s Note of the 19th inst. discounted at Montreal Bank, at 7 per cent. Discount, -S — . Cash received, §— . Remitted W. & F. P. Currie & Co., Montreal, Bank Draft for amount of their invoice of iSth inst., less 2 J per cent discount ; paid Cash for Draft and yi per cent Exchange. Foreman's Report.— Lost time: D. Liddell and A. Ewing, absent all day. Extra work for W. A. Foster M: Co., I day blacksmith and helper, $5 ; 7 hours Post, 4 hours Jones, 6 hours Petre on r.o-.iiaci'.ig rods, at .^4 per day. 22— Paid D Liddell and A. Ewing in full for services to date, including to-day, and discharged them. Received from R. Abrams. on acct., W. T. Heaslip's note at 3 months for S>SOO. Paid John Davis, Foreman, $10 on acct.* Sold Gilmore & Co., for Cash, 2 Steam Engines, " 14 x 16,' with ileaters and Set Gear, ij^iSoo ; 2 Steam Boilers, 14 x 5 ft., at •?IS50 each, less 2 per cent, from the tot.al amount I Foreman's Report. — Lost time : Robert Jones reported sick. Extra work for W, W. Tones ic Co., 4 hours Petre, 6 hours Grass, i day Hudson, 7 hours Fraser, dressing and fitting Wooden Rollers, at $3.50. * When hands receive anything on account during the week, deduct the amount from their wages on pay day, and just keep a memo, in the till to represent it till then. 125 23— Engaged Robeet Way, S. Boyk and H. Cover, at $1.50 per day, services to commence on Monday, the 25th inst. Had H. T. Hcaslip's Note of the 22nd inst. discounted at Montreal Bank at 7 per cent., and proceeds left to credit. Foreman's Report.— Lost lime : Robert Jones, absent. Extra work fur A. S. I'afje & Co., 8 hours I'otts, 4 hours Everett, cutting bolts : I day Lynn, 7 hours West, bushing old pulleys, at .^4 per day. Paid hands in full for services. 2^ — Received from Peter Williams, Cash for his Note of Oct. 2ist, and interest thereon. Remitted Frothinjjham iS: Workman, Montreal, a Hank Draft for the amount of their invoice of the l6th inst., less zj per cent ; paid Cash for Draft and '^ per cent. Exchange. Delivered per order of R. Abrams, 12 Scotch Canadian Ploughs at $10 ; 8 I^ouble Crook ilnrlburt do. at $12 ; 4 Side Hill do. at $8.50 ; 2 Reynolds Water Wheels at $75. Foreman's Report.— Lost time ; Petre, i day ; Lynn i day. Extra work for W. A. Foster & Co., 4 hours blacksmith and helper, making keys for connecting rods, at $5 per day. Stoneburg, Davis, Post and Lynn worked overtime ^ day. 26— We are necessitated to suspend operations in consequence of putting in a new boiler, the old one being considered unsafe. The hands required to assist in making the change are : Davis, Jones, West, Post, Potts, Lynn and Huff; the others are not retpiircd until we ccmmence operations again on the 29lh. 29— We allow A. R. Patterson $600 for the old boiler, and credit him with that amount, and charge him $1800 for the new one, the connections therefor and labor in making the change ; the difference will remain at his debit, but the debit will be reduced as rent accrues due and is placed to his credit. Received from R. Abrams, Cash on account, $200. P'oreman's Report.— Lost time; Lynn i day. Extra work for W. W. Jones & Co., I day Roberts, 7 hours I,ong. S hours .Spring, 3 hours Petre, cogging wheels at $3 per day, Stonel)urp, Davis, Huff, Spring, Long ancl Post have each worked overtime i day. Received from F. J. Dickson, ('ash in full for his Acceptance of March 24th. Paid our Acceptance of the 14th inst. favor of Frothingham «S: Workman, per Check. 30— R. Abrams has returned 4 Double Crook H. Ploughs at $12 ; 3 Scotch Canadian do. at $10 ; i Side Hill do., $8.50. Sold Robert West for Cash, 2 Steam Engines (35 H. P.), at $750 ; 2 Steam boilers (50 H. P.), at $1000. Foreman's Report. — Lost time : Huff, ^ day. Extra work for A. S. Page iV Co., i day Post, S hours Huff, fixing Pumps, at $4 per day. The following hands have each put in J day extra time : Davis, Jones, Everett, Petre and SVest. Pay the hands in full to date, make Rent Dr. to the landlord, take off a Trial Balance and Balance Sheet, and close the accounts. Inventory, $8262.96, Merchandise credit in Journal, $10969,44. Net Gain, $4438 63. Cash on hand, $33141.28. Time sheet footings. No. i, $181.67 ; No. 2, $187.97 ; No. 3, $181.61 ; No. 4, $143.61. If Wages acount is closed into Merchandise, the cost of raw material being already debited to that account, the Dr. side of Merchandise will show total cost. REMARKS ON SET XIII. The material from which the transactions of this Set are constructed was obtained from an extensive foundry and machine shop, and the routine has the merit of being practical. The forms of the books, and arrangement of the various records, are submitted as being very simple and in general use throughout the country. The form of Day Book adopted is similar to that of Set XI., all credU sales of merchandise being extended into the outside column, and forwarded from page to page until the end of the month,'when the total amount is posted to the credit of Mdse. account. When work is charged by the day it is extended and posted to the credit of merchandise the same as though it were the sale of a manufactured article. This plan is adopted in the majority of machine shops, because the labor of hands is continually engaged on implements or machinery of some kind, which, when sold, 126 »: will go to the credit of Merchandise account, and it would be very troublesome to keep the cost of material and work separate from one another. In manufactories where the hands are not paid weekly, and are allowed to draw on their wages accordingly, there is no way of keeping a running account with each of the hands with lers trouble and greater accuracy than by adopting the plan of keeping a small Ledger exclusively for the accounts of the hands employed, called tlie " Hands' Ledger." The adoption of this plan saves the opening of so many accounts in the General Ledger, keeps the accounts of hands together and separated from all other accounts, and avoids trouble and detention at the time of making out a Trial Balance or balancing the General Ledger. A column should also be kept on the credit side of the Cash Book for amounts paid hands, and when money is paid to one of the hands it should be placed in this column and immediately posted to the debit of his account in the Hands' Ledger. When a " Hands' " column is kept in the Cash Book, it is footed and forwarded to the end of the month, and then posted in total to the debit of Hands' account. In cases where the Hands' Ledger is adopted, it is necessary to keep a •' Hands' Account " in the General Ledger, and credit it from the Time Book, at the end of each week or month, as the case may be, with the following entry : " Wages account Dr. to Hands account." This plan keeps the two Ledgers entirely distinct from each other, the one account in the General Ledger containing the result of all the accounts in the other Ledger, and showing at any time the amount owing to hands. When the hands are all paid off and the Hands' Ledger balanced, this account must balance also. PLANT ACCOUNT. It will be observed by the student that the proprietors of this business rent the Foundry already fitted for their purpose ; but suppose they had purchased it and the necessary machinery to carry on their operations, they would require an account in the Ledger to represent these, which is called Plant Account. To the debit of this account is placed the cost of the permanent plant of the concern, — by this we mean the machinery and tools by the use of which its goods are produced, and not anything that may be purchased to be sold or manufactured. When closing the Ledger there are two ways of dealing with the Plant account. Owing to wear and tear, the plant of the concern is now not worth so much as it was when you purchased it, or when you last closed your books ; hence you must '* write off" a portion of the amount charged to the account to Loss and Gain, so as to leave the debit at the figure you estimate you could sell the plant for. You may write off say 5 per cent. by making this journal entry and posting it : Loss and Gain, Dr. To Plant Account. For 5 per cent, written off for wear and tear ; then close the account By Balance, and bring down the balance on the Dr. side ; or you may take an inventory of each part and piece that makes up the plant of the concern, place the amount of the Inventory on the credit side of the account, and close it by Loss and Gain, and bring down the inventory on the Dr. side. Any | property account, such as office furniture, would be dealt with in like manner. 12^ Want of space prevents us from recording more than a few of the first transac- tions in the following : FORM OF DAY BOOK -Set XIII. BeiU-ville, April is/, 1894. Led Kol. Sundries Dr to Student For following investnient : Cash as per C. B Bills Receivable, J. Brown's Note, B. B. $8500 2000 Sundries Dr. to A. M. Spafford I I For investment as follows : Cash as per C. H Bills Kec, Note against Williams and Draft on l>ixon, as per B. B. . . Interest Accrued on above Note . . Merchandise Dr Fuel Dr To Bills Payable Bought of A. K, Patterson, Implements, Iron.; &c., as per invoice, and 100 Cords of: Wood at $5, for which we gave 4 Notes at 3, 6, 9 and 12 months, for equal amounts, as per B. B. tzooo 2500 54 15500 500 Robert Abrams Dr. to Mdse. I For 7 Scotch Canadian Ploughs, at $10.00 . ! "4 Mohawk Valley " 9.00 . i " 6 Double Crook H. '♦ 12.00 . 5 Merchandise Dr To Frothingham & Workman Bought of them on acct. as per invoice of thi.» date. 70 36 72 490 Merchandise Dr To W. & F. P. Currie & Co Bought of them as per invoice of this date. A. S. Page & Co.* Dr. to Mdse. To 5 hrs. Winters " 2 " West *• 7 *' Everett Drilling and Dressing Spiders, Mdse. Cr. by .Sundries. 950 ...i CO CO 1JI0500 CO 00 00 00 I 00 '4554 00 00 00 00 16000 00 CO 80 80 H Merch.-tnclise. 00 00 00 490 950 178 00 00 5 00 60 60 * A. H. Page & Co. are charged for this work at the rate of $4 per day [ 10 hours work, 40c. an hour], which is consid- I erably more than we pay the same men, but it must be remembered that we furnish the machinery, tools and other neces- saries, and are under heavy expense aside from men's wages. 128 ,♦; TIME AND WAGES REGISTER OF THE DOMINION FOUNDRY For the Week ending SiUurday, A/>ti/ <)i/t, 1894. No. NAMK. M. T. w. •i\ 1'. s. Total Rate jifi- (lay. I Amount. Kec. tlic anioiiiii m^i oppusitL 'Ur- respective iiaiiK-, 1 John Davis, i 1 I I l\ 2 75 '5 12 1 'john Davis. 2 G. Abrahams, I I I i 6 : 2 50 «5 1 00 jG. Abrahams, 3 A. Winters, i I I i 4^1 1 2 1 25 10 69 A. Winters, 4 Robert Jones, I I i i 5 I 50 7 50 R. Jones. 5 Wm. West, I I 'I I Si I 50 8 25 W. West. 6 H. Darnley, 4 I I I > 5i ; I 5° 8 25 H. Darnley. 7 S. Post, i i 1 1 1 5 1 I 50 7 50 S. Post. 8 Warner Potts, I -'\ I i • 5 t 50 7 50 Warner I'otts. 9 Isaac Raniing, 11 — — li I 50 2 62 [, Raming. 10 George F.verett, I I I I I 52 I 50 8 62 Geo. Everett. 11 vSamuel Lynn, Ent\l. Cash Book h'oUo — ' I I I I 1 6 j 1 50 9 100 00 05 Samuel Lyn. When men are paid every week, the above form will enable the accountant to keep d correct record of each man's time. In cases where men work extra time, it may be entered in the same column immediately over the day's work, and all extended in the Total column at the end of the week, or it may be recorded in a coluinn headed " Extra time." If the men are paid every two weeks, twelve day columns are necessary. In business the above $105.05 is brought forward into the head of the •' Amount " column upon the next page, and so continued from page to page until the whole list of workmen is complete. On pay-day the whole list is extended as above. The men assembled, the Pay Clerk calls the names in their order upon the register, hands each the amount due him, and checks it upon the left of the money column, thus ^/, and each signs his name. The total amount is entered in the Cash Book and charged to Wages Acc't. By having a large book, one space for names will serve for four weeks ; the ruling for the third and fourth week to extend upon the opposite page. in case the men are not paid in full, extra colums, headed " Paid " and " Due," should be kept, and wages standing over should be entered in the " Due " column, and added to their earnings on the next register. The few names entered in the above form are sufficient to show how this book | should be kept. When cash is advanced to men during the week, a memorandum is kept of it in I the till, or their due bill is taken, and these are counted as cash ; at the end of the | week ihe ^ucos are simply kept out of the wages. The follow Innd will answe ■parties at their Iweeks, and if Ithe necessity 01 ItIME AND ' Name. lames Amos, luhn Bates, \. Corn, Date, |I. Evans, Favor, |i. (jovcn, . Hand, . Irwin, Jones, Words, Forwar( * The footing of ea bli liook in total. 129 WEEKLY TIME AND WAGES REGISTER. The following form is designed for paying men by the piece in weekly payments, land will answer to keep an account of work either done in the manufactory or by Iparties at their own shops. By adopting the following plan one i)age answers for two Iweeks, and if opposite pages are taken they will answer for four weeks, and thus ^avc ■the necessity of writing the names so frequently. ItIME and wages REGISTER of THE dominion BOOT AND SHOE MANUFACTORY. «•«. June I, 1894. ' Jiuie 8, 1894. Name. (Jiiantily. Rate. Amount. 1 ! (Jiianlity. Kale. Amount. ames Amos, Sprs. Boots, 2 10 uhn Bates, 4 •' It I 75 7 (. Corn, 5 " ^t I 75 8 75 .. Date, 3 " f i 2 6 I. Evans, 4 " i( 2 S .. I'avor, 6 " Shoes, I '5 6 00 . (Joven, 5 '• 4i I 75 8 75 . Hand, 3 " Boots, 2 6 . Irwin, 2 " »' 2 4 . Jones, 6 •' Slippers, 60 3 60 Words, Forward,* 5 " Boots, 2 15 10 75 1 79 75 * The footing of each i>li Book in total. page inaj • be forwarc ccl until the who le of the workniei 1 are paid c )ff, and tl len carried to 1 le 130 .♦, S. G. BEATTY, & GO'S PAY ROLL FOR THK BAY OF QUINTE MILL, For the month emiing July, ^ist, 1W94. We, the undersigned, do hereby severally ncknowlcdKe the receipt from Messr?! S. (f. Heatty & Co., of the sums opposite our respective names in ftill payment fn work done in the above Mill, to the above date : — No. Nnmcii. Occupation. Millwright Wages rate per month. » c. 7« Dnyn. 25 Am'nt. « c. 75 50 Deduc- tion llent!". !!>«* c. 103-5 SO Am'nt. % c. 18 50 Net Am'nI. * c. 57 Sfgnntiire«, I John Armer |ohn Anna 2 James Avert Foreman 65 25 62 8.2.4 50 14 50 47 SO fames Aval 3 J. W. Archer {{locksmith 52 25 50 10,4 14 36 f. W. A.clie, 4 S, W. Dull Filer S2 25 SO 10. 10 40 S. W. liiill 5 F. H. Hurk dang 39 24 36 10. 10 26 F. H. H,„k 6 S. K. Bones Gang 39 24 36 00 10. 10 26 S. R, Bono, 7 T. Camp Gang 39 23 34 50 34 50 Thos. Camp 8 II. L Cross Gang 39 25 37 50 4-3-S 12 25 SO H. L. Cii,M 9 P. T. Chime Gang 39 25 37 SO 6.2.2 10 27 50 P. T. Chime 10 L. II. Davis Circular 39 25 37 50 5.8.7 20 '7 SO L. H. Dim, 11 T. K. Day Setting 32 SO 24 30 10. 10 20 T. k. D.ny 12 H. M. Dews Circular 32 SO 23 28 75 10. ID •8 75 H. M. Ik*- «3 R. T. Evens Edgcr 32 SO 2S 3> 25 10. 10 21 25 K. T. Even, 14 S. W. Forks Tailing 32 SO 25 31 SO 10. 10 21 25 S. W. horks IS A. B. Fife Sorting 32 SO 20 25 '5- «5 10 A. B. Fife 16 Cha?. Cjover Sorting 32 SO 25 3« 25 4.1.5 10 21 25 Chas. Govtr 17 D. L. Ham Engineer 52 00 25 SO 3.7 10 40 D. L. Ham 18 H. S. Horn Fireman 32 so 25 31 25 10. 10 21 25 H. S. Horn 19 James Irvin Piling 32 50 20 25 10. 10 '5 Jas. Irvin 20 James Jakes Piling 32 50 21 26 25 26 25 James Jakes 21 S. N. Long Piling 32 so 24 30 30 S. N. Loni; 22 H. r. Marvin I'iling 32 SO 24 30 10. 10 20 H. P. Marvii 23 W. B. Moon On boom 26 00 25 25 25 W. B. Mom 24 C. North On boom 26 CO 25 25 4.2.4 10 •5 his ni.nrk. W itness 25 David Port Teamster 32 so 20 25 S- 5 20 David Port 26 G. H. Rover Yard 26 CO 21 21 ID. 10 II G. H. Rov« 27 John Sokes Yard 26 00 23 23 ID. 10 »3 J no. Sokes 28 J. Wright Ent,e5 A o h ^ 10 '78 196 his C. X mark. Witness R. !97 439 447 389 396 564 I 426 579 I 43" 687 I 349 674 I 366 669 686 719 I 847 743 I S63 10 10 190 210 453 461 378 ( 556 389 I 571 453 426 659 666 372 I 649 I 726 I 861 348 I 672 ' 735 I 852 13 II 198 i 204 449 458 392 382 582_ 574 445 432 672 I 369 658 I 384 693 668 75" I 867 742 12 12 201 206 462 456 386 391 569 586 45' 683 426 647 391 376 659 667 738 75« 853^ 866 854 It 197 438 392 562 ' 438" 654 369 672' 731 847' i 206 452 387 579 419 676 387 681 745 862 72 \ '4 2298 5431 4662 6864 5237 8003 4436 8015 8834 10290 V n' s! ^ s! ^ \' The above is the form generally adoi)ted by cheesemakers Jor keeping a daily and weekly record hhe amount of milk received from patrons. We have seen no less than eight different forms in use, Ih having particular merits ; the above recommends itself on account of its simplicity. The amounts Iween the double ruled lines represent the total number of pounds of milk received daily from the Iton under whose name they appear. In the upper space amount received in the morning is entered, I in the lower that received in the evening. At the end of each week the amounts are added lether, and the totals are carried to their respective accounts in the regular book kept for that pur- |e, placing a check mark beneath each sum as in the above when transferred. We have only given a few of the patrons' names, and continued the entries for two weeks, as the 1 is so simple that it can be readily understood. The other books of account in connection w ith I business of a cheese factory do not differ from ordinary books. ■k: c « 132 STEAMBOATING. The Books of Steamboats, like those of any other business, are kept in various forms. liut ttj principles of accounts apply to every kind of business, anil when thoroughly mastered, can be readilJ adapted to any form that the peculiarities of the business may require. Skilful men adopt such fotitj of books as are most convenient and best adapted to their peculiar kinds of business, and which nuJ be kept in the easiest and simplest manner, but it is only in some minor details, which are ea-i;i| understood after the princifiles of accounts have been fully mastered, that any novelty is possible. We have examined a number of different forms in use on some of the jirincipal vessels thai navigate the lakes and rivers of our country, and recommend the form here presented on account of its simplicity and practicability. The books used are the Hands Register, Fuel Book, Freight Book, Passage Book, Cash liooii Journal and Ledger. Sometimes a Hands Ledger is also used, in which an account is kept with eaci hand employed. Also Pocket Memorandum Books for taking down freight (when no bill of lading i furnished) as delivered to the beat, and a Deck Passage Book. THE HANDS REGISTER contains the name, occupation, the day upon which service commenced, rate of wages per month, eicj of each employee, and is similar in use to the Time Book in a Manufacturing business. It is usedtl record the amount of labor performed and paid for. THE FUEL BOOK, as its name implies, contains a statement of the amount of fuel purchased, from whom, and theda;j of purchase. THE FREIGHT BOOK, OR MANIFEST, contams a classified list of the goods received for transportation ; being plainly arranged, it exhibitsi: features and use without further explanation. THE PASSAGE BOOK is intended to record the names and numbers of the passengers, the places of embarkation aij destination, and the amount of fare paid. THE CASH BOOK, as in ordinary business, contains a record of all Cash received and paid out. It is made up from i| items recorded in the foregoing books, and from it and the Journal the entries are posted to Ledger, which is the same form as in general use. TRANSACTIONS. TRIP L— FROM BELLEVILLE TO MONTREAL. June 1st, 1894. — J VV. Johnson and Geo. H. Pope have this day formed a partnership, and purchii^ the Steamer " City ok the Bay " for §35,000. They invest equal amounts, and are to share gains and losses equally, as per articles of cc-partnersi of this date. They have paid for the boat as follows : Cash .^20,oco, for which each advances §10,000, andi| balance in two Notes, one at 3 months for §10,000 and the other at 15 months for >*3!» both Notes hearing interest at 6 per cent. J. W. Johnson has advanced lor incidental expenses, Cash, §750. Geo. H. Pope •* " " " §800. The boat will ply between Belleville and Montreal, and the present crew will be retained. The following list embraces the Officers and Crew, and their salaries. Geo. H. Pope, Captain §100 per month. J. W. Johnson, Purser, 75 " " Wm. Ireland, First Mate, 5° " " John F. Steele, Second Mate, 40 " " G. P. Mansard, Wheelsman. 30 " " 1 ohn Frost, * ' .... 30 " • ' 0. R. Whaley, First Engineer, 70 " " A. B. West, Second " 40 " M. Peterson, Fireman, .... 30 " " John P. Ray, •• 30 ". " H. Maiiland, Cook, I. B. Simpson, Deck Hand, . . R. P. Strong, B. C. Mnrney, " . .. George Pearson, " Susan Broady, Chambermaid, Isaac Epicure, Cabin Boy, . . Daniel Alert, Watchman, A. B. Stunners, Porter, ?2S per nior 20 20 ' 20 ' 20 i ID ' 12 ' 12 ' 10 ' > lieileville. 133 ms. Hut ihtl :an be readilJ ipt such fuinJ nd which mijf ich are ea^ilj possible. il vessels thai on account ol k, Cash Boo'J kepi with eacM )ill of lading i )er month, etc.| . It is uscdi ni, and thedii ;d, it exhibits iJ mbatkation anl lade up from ij posted to p, and purchas of cc-parlner-;. §io,cxx), and I nonlhs for i^jM Juiii !''• — I'ai'* Downey & Pope for 20 tons Coal, at $5.50, $110 ; R. Price, for Provisions, $too ; [ohn (Jrainger, for Meat, !iii20.50 ; A. Henry for Ici-, $6.50 ; Henry Blair, 8 cords of Wood, at !?6, .*!4S. deceived the following goods : — Pill OF Ladinc, No. i. — From Victoria Foundry, Belleville, to William Watson & Co., Cornwall, marked " W. W. & Co., C," 50 Excelsior Coal Stoves at .$2. ^ILLOK Ladinc. No 2. — From George Wallbridge, Belleville, to Jones iV Smiih, Brockville, marked "J. & S., B ,' 100 bills. Pork at 50c., 40 casks Bacon at 60c., 10 boxes Sundries at 40c. kliLOK Ladinc; No. 3. — From Foster, Barber & Bri;.mall, Belleville, to Joseph McKiy iV Co., Montreal, marked "|. McK., M.," 12 boxes, 3^00 Ihs., at 30c. per hundred. leceived the following passengers at the P'ort of Ikllevilic : Wm. Jones for Piclon, :?i.* S. Cj. ISe.itty for Montreal, 84.50. F. Hart, wife and daughter, Brockville, •ii'ioO. Miss S. Johnson, Cornwall, $3. Jas. Paiker and wife, Cornwall, at $3, ItCEiVKi) AT Port OK Picton : Bill oi' Ladinc, No. 4.— From J. K. Frimmier, to Sampson, Voung tS: Co., Montreal, marked "S., V. & Co., M.." 240 boxes Fggs at 25c., 55 firkins butter at 15c. Also the following passengers : |. Kerr for Montreal, 84. J. P. Forrester and wife, Montieal, at .?4. Peter West, Cornwall, $2.50. .S. C. Palmer, (iananoque, %ii.50. |ll OI'- Ladino No 5 — From J. Carruthers & Co., Kingston, to R, Smith, Montreal, marked " R. S., M.," 500 bbls. Flour at 40c., 20 tons Bran at ^2. liLi.OK Ladino No. 6. — From Parker & Son?, Kingston, to G. P. Easterbrook, Montreal, 15 kegs of Nails at loc, marked " G. 1'. E., M." lissKNCERS FROM KiNC.STON.— Geo. W. Easton, fur Cornwall, .S2. A. Diamond, Montreal, $3. 15. C. Daymond, wife and two daughters, Montieal, at $3. R P. Daley and wife, Brockville, atSl.50. Discharged J. P. Kay. l«i' 2K}i. Miss W. Manion, Miss Susan Brown and Miss Nellie I'eterson, for Montreal, at ■'?2.5o each. |u. OF Lading No. 8. — From L. G. Smart & Co, Brockville, to W. iV F. P. Currie & Co., Montreal, 275 boxes Sundries at 7Sc., 280 kegs Nails at loc. iHvered to agent at Brockville the goods consigned to Jones iV Smith. The Freight being unpaid is charged to the agent, George Webber. I'aid Geo. West, for 10 cords Wood, $50. SE.Nr.ERS FROM Brockvillf.. — S. Spangenberg and wife, Chas. ('orby and Geo. Sutherland, for Montreal, .S2each. Jno. Wilson and wife, for Cornwall, at .'^i'l.uo. Collected Freight at Corn- wall. |.LOF Lading No. 9. — From J. Wellcr & Co., Cornwall, to J. G. MacKenzie & Co., Montreal, marked "J. G. M. & Co., M ," 50 cases Tweed at 25c., 80 cases do at 30c. |CEIVED Passkngf.rs FROM CORNWALL. — Jno, Macoun and wife, and }. P. Linger, wife and two (laughters, for Montreal, $1.50 each. Paid A. II. Stephenson, for ten tons Coal, $60. l;i'4'/i.— Delivered to the agent at Montreal the goods consigned to that port, and received Cash for Freight. Paid Canal Toll, $7.50. Discharged A. B. Stunners. Deck Passage, $41.50. il c FUEL RECEIPTS, STE.AMER "CITY OF THE BAY." TRIP I. -FROM BELLEVILLE TO MONTREAL. lined. $25 per 20 " 20 " 20 " 20 " 10 " 12 " 12 " 1. 10 " moil ■te, I]- Where Kought. Tons Coal. Cords Wood. 8 5 10 Prices. 1 1 i Amount. Received Payment. 1 ! : 1 ' (. 2 u (i lielleville, Gananoque, Brockville, Cornwall, 20 10 30 6 4 5 6 50 81IO 48 20 50 6o Downey &> Pope. Henry Blair. J. R. Moser. George West. A. H. Stephenson, i 23 )$288 Entered C. B. page 157. The berths as.signed passengers should he entered as in Passage Book. This being a mere matter of detail, we I the student to enter the numbers himself. * ♦ 134 HANDS' REGISTER, STEAMER " CITY OF THE BAY." TR1I> I. -FROM BELLEVILLE TO MONTREAL, 1894 Name, (ieo. H. I'ope, I. W. Johnson, Wm. Ireland, John F. Steel. 0. R. Whaley, A. B. West. (J. P. Mansard, John Frost, S. M. Peterson, J . P. Ray, H. Maitland, D. B. Simpson, R. P. StroPR, B. C. Miirney, {Jeorge Pearson, Susan Broady, 1. Epicure, I). Alert, A. B. Stunners, Occupation. Captaii , Purser, 1st Mate, 2nd " 1st Engineer, 2nd Wheelsman, *t Fireman, Cook, Deck Hand, Chamber Maid, Cabin Boy, Watchman, Porter, Uiite of Time. Wages per muiuli. Amount . Paid. Employment. June 1 ,? ds. 100 1 10 it 1 1 1 J " 75 7 SO a »t 3 " 5" 5 5 i( ( 3 " 40 4 4 (( 1 1 3 " 70 1 7 7 t( «* 1 3 " 40 4 4 ■ ( tt 3 30 1 3 3 It a 3 '• 30 3 3 (( (« i? " 30 3 3 ti t( 2 " 30 2 2 ''3 " 25 2 50 2 50 ( I t * 3 " 20 2 2 .( i. '] " 20 2 2 a (( ;? " 20 2 2 *k «4 '3 " 20 2 2 t( i * 13 " 10 1 I If 11 3 " 12 I 20 I 20 II .» ? " 12 1 20 I 20 11 tl 3 " 10 1 I Total wages this trip. 63 40 Amount paid this trip, 45 90 Remarks. Paid & Discha rgeo,| Discharged. Ent'dC.B.,F.ii PASSAGE BOOK STEAMER "CITY OF THE BAY." TRIP L— FROM BELLEVILLE TO MONTREAL, /une 1st, 1894. Names of Passengers. ICmbarkation. Destination. No. I Herth. Fare. 1 Aniouni. Wm. Jones, Belleville, Picton, 4 I OO 81 00 S. G. Beatty, (( Montreal, 1 8 4 SO 4 W F, Hart and wile, (( Brockville, 2 6 3 SO 7 00 Miss Ida Hart, It i« I 2 3 SO 3 5" Miss S. Johnson, (( Cornwall, I ID 3 OO 3 M lames Parker and wife, (( >• 2 16 3 OO 6 00 J. Kerr, Picton. Montreal, I 20 4 OO 4 00 [. P. Forrester and wife. (( " 2 '3 4 OO S 00 Peter West, i( Cornwall, I 2 so 2 50 S. C. Palmer, 11 Gananoque, I 5 I 50 I 50 Geo, W. Easton, Kingston, Cornwall, 1 7 2 00 2 00 A. Diamond, t( Montreal, I u 3 00 3 OJ B. C. Daymond and wife. (t 4( 2 »7 3 00 6 00 Jane and Sarah Daymond, ii >> 2 16 3 00 6 00 R. P. Daly and wife. it Brockville, 2 '9 I so 3 <» John West and wife, Gananoque, Cornwall, 2 >5 I 00 2 00 Miss W. Manion, (( Montreal, I 22 2 so 2 50 Miss Susan Brown, <> (. I 21 2 so 2 50 Miss Nellie Peterson, t< (( I 24 2 SO 2 50 S, Spangenberg and wife. Brockville, «( 2 26 2 00 4 '■ Charles Corby, t( t( I 29 2 00 2 03 Geo. Sutherland, (4 14 1 30 2 00 2 00 John Wilson and wife. ,1 Cornwall, 2 34 SO ■I 00 fohn Macoun and wife. Cjrnwall, Montreal, 2 27 I SO 3 « I. P, Linger and wife, *» • 1 2 1 SO 3 M Miss Mary Linger, ,( 44 I I SO 1 5« Miss Susan Linger, (1 .4 Cah'n Fgers, I I 50 I 5« * Deck, D.P.B. Total RecUs. e> 22 teted c./?,/ 'lage I 56. 41 5« $130 00 * 1). P. U. stands for Deck P assage Uook, a small memorandum book n whi( :h the nai Ties, pi ransfer acis of embarkation 1 destin.ition of the deck p.issenger s are registered. Th e total receipts of t his be ok are t red to the Passage k before posting. 1 135 OBSERVATIONS ON BOOKS. Remarks We have in the Hands Register extended the time each hand worked during the I trip and the amount he earned, in the proper columns. This would not be done in [regular business until such time as the hands would be paid or credited with their Iwages. It will be observed that the hands are all paid except the owners of the Ivessel, the Captain and Purser, whose salaries are journalized and placed to the credit |of their respective accounts. The books should all be paged, and references between them should always be & Dischargea, Jtnade by the page instead of by the trip. The Fuel Book is so arranged as to give all necessary information respecting all M purchased. The amounts paid in Cash for fuel are here collected, and carried lorward from page to page until the end of the trip, or such time as a statement is Required, when it is entered in one sum in the Cash Book. The columns for inserting [he number of tons of coal and cords of wood enable you to carry forward the nuantity of each, and exhibit in the statement the amount of each purchased. harged. 'dC.B., F.ijjl Aniouni. O O o o p ,o $1 4 7 3 3 6 4 8 2 I 2 3 C 6 3 2 2 2 2 4 2 I 3 3 I I 00 ^0 00 'A 00 oo 00 ool 5° 50 ool ool 00 ool 0)1 ool 5» 3« 5«l f, oil oo 00 00 00 41 SI30 's of embarkations d to the Piissage According to the style of Passage Book adopted with this set, the names, places If embarkation, and destination are registered as the passengers engage their passage [nd choose their berths. It thus serves the purpose of a passage list and a Cabin jlegister ; but for large boats, where many passengers are getting on and off requently, this book would not answer. The Cabin Register, where one is kept ^.arately, is usually left on the table for the use of the passengers. Sometimes through tickets are issued by boats, and passengers re-shipped on kher steamers or railways. In such case Passage account may be credited with the (hole fare and debited with the cost of re-shipping. The same rule is also followed re-shipping freight. The Freight or Manifest Book is explained by the headings of the different blumns. Make out for each port a sheet or sheets from the manifest ; copy these in ^ur abstract manifest book by the copying press, and on this take receipts from agents (r goods delivered. A steamboat is not supposed to do a credit business, but there (11 be times when the agent to whom goods are delivered will not have change to |y the freight, and it becomes necessary to keep track of it. In a case of this kind ike a note of it in the column for remarks, and if it is not paid before the Freight tiok is posted, make a journal entry charging the agent with it. See amount irged G. Webber in the following Freight Book. When goods are delivered to by another steamer, or an Express, or Railway Co., on which there are back arges which you are required to pay, see that the shipper inserts the amount on ir bill of lading. This gives you the same authority to collect the charges that have for collecting your own freight. In case you re-ship goods, take a Bill of ling from the boat or company with which the goods are entrusted, in order to Id it or them responsible for their safe delivery. No entry is required for sums pnced for back charges on freight from other boats or companies, except it should Jain unsettled at the time of makir j out your statement, when it should be entered [he Cash Book. ,See Note, Freight Book, page 136. •iMki «;; iaii.^ri4« 186 «; FREIGHT BOOK TRIP isr, STEAMER "CITY OF THE RAY," FROM Shipper. Where Shipped. Consignee. Destination. Numbers and Marks. Victoria Foundry, Geo. Wallbriclge, Belleville, It ( t VVm. Watson & Co., [ones & Smith, Cornwall, Brockville, It f,**\V. W. & Co., C, ■ 2, "J. cS: S., U." •t ti (< •< (4 t( (( <1 •! Foster, Harb;r & Brig'll. J. K. Frimmier, It >i Picton, 1* Jos. McKay & Co , .Samson, Young & Co., Montreal, 3, '• T. McK. & Co., M ; 4, "S, Y. &Co., M„" t* (t J. Carruthers & Co. , Kingston, R. Smith, It S, R. S.. M.," It <( Parker & Sons, B. A, Abbott, Gananoque, G. P. Easterbrook. James Tiller, t( 6, "G. P. E.. M.," 7. "J. T., M.," • t (t L. G. & Co , Brockville, << W.AF.P.Currie&Co.. 4( n t( 8, "W.&F.P.C.cS:Co.,M.," J. Weller & Co., Cornwall, [. G. McKerzie&Co., 4« (1 9, "J. G. M. &Co, M,; Note. — Incase back charges are paid another Steamer or an Express or Railway Co., from which you receive Freight, the amount is entered in the column kept for that purpose, and a ticket placed in the Cash Box until the money I is again collected. No other entry is rci|uirod, as it is similar to a simple loan. OR M. BELLEVIL 50 Excelsioi 100 bbls. Poi 40 casks Bai 10 boxes Su 12 boxes 35c 240 boxes Eg 55 firkins Bt SOD bbls. Fioi 20 tons Bran '5 l30 7<4 7U 1 'i 40 40 •30 Sundries, loSoo 10750 130 7 '4 401 Date. 1894 lune 1 1 j J22394 4t 1 F. '38|| v/ '3911 V x/ i4ol{ '39I '39| »39 187 300K I OR MANIFEST. f » FKOM I BELLEVILLE TO MONTREAL, JUNE ist, 1894. d Marks. Co., C," I." St Co., M ; Co., M„" . iVI., >» '» C.&Co.,M.," . & Co,M.," ich you rcccrte until the money Articles. Rate 2 00 Items. Amounts. Back Charg's Collected Remarks. 50 Excelsior Coal Stoves, 100 ion 100 bbls. Pork, .SO ■JO 40 casks Bacon, 60 24 10 boxes Sundries, 40 4 7S Charged G. 12 boxes 3500 lbs., 35 cwt.. 30 10 SO 10 SO Webber. 240 boxes Eggs, 25 60 55 firkins Butter, IS 8 2.S 68 2S 68 2S 50D bbls. Flour, 40 2CX) 20 tons Bran, 2 00 40 240 240 15 kegs Nails, 15 cwt.. 10 I SO I so 40 Cast Iron Rollers, 1600 lbs., >S 2 40 35 Cumming's Straw Cutter, 60 21 00 23 40 23 40 275 boxes Sundrie.s, 7.S 206 2.'; 2S0 kej;s Nails, 10 28 00 234 25 234 25 50 cases Tweed, 2.S 12 so So " 30 2400 36 50 40 36 SO 40 792 714 Ent'd C. B., p. 136 " .Tournal, Chargec G. W 1 'ebber,— — 78 — Page 138 792 40 KlktiMMM steamer|"City of the bay." 1 i.fui™ BELLEVILLE TO MONTREAL, 1894. 1ST. — I'l^^"'^ Sundries, loSoo 10750 130 ; 714 4»| CASH. Cr. Date. 1894 une F. 138 1.39 sJ 140 139 139 139 Disbursements. By Stea.mer, Paid on her acct , " Stores Acct. Supplies at Belleville, " Expense, Toll passing Canal, " Wages, As per Hands Register " Fuel, As per Fuel Book, Wages Dr. to Cash, Fuel ' Stores " " " Total to Cr. of " Balance. Wages. 45 45 Fuel. 90 go 288 288 Stores. 127 127 Sundries. 20000 4S 288 127 50 90 20468 1926 22394 40 40 I f m % ■ir ■ 138 JOURNAL. TRIP IST.—FROM BELLEVILLE TO MONTREAL, JUNE IST, 1894. 138 139 139 139 140 138 138 Dr. 1S94 June June Steamer " City of the Bay," Dr. To Bills Payable, Gave our notes in part payment of the vessel. 2 G. Webber, Dr. To Freight, Freight unpaid per Freight Book. 4 Wages acct. Dr. To G. H. Pope, " J. W. Johnson, Proprietors' salaries unpaid. I5CXX) 15000 78 78 17 50 10 7 1509s 50 15095 SO LEDGER. GEO. H. POPE. Cr. To Balance, 1 ( 1 1028 25 1894 June I 4 4 By Cash, C. B. " Wages, " Loss and Gain. By Balance, $11028 25 J. W. JOHNSON. To Balance, 10975 75 June I 4 75 11 4 1097s By Cash, C. B., " Wages, " Loss and Gain, 136 138 140 10750 CO 7 ^50 2lS 25 10975 75 By Balance, STEAMER "CITY OF THE BAY." Dr. 1894 June June 4 Tc T June 2 To To , 1 June 4 1 To J June a\To I June I ToC ^•0975 75 ■ June! i To C; Tune 1 To Cash, C. B. I ♦• Bills Pay., 137 138 20000 15000 35oc<^ June By Balance, To Balance, 35000 |june| 3 4 4 4 ToCs " St •• Fu '• W ooo 78 10 7 50 5095 I 50 Cr. 10800 10 1 218 |2i IIO28J25 10750 CO 7 '50 218 25 10975 75 Dr. 139 BILLS PAYABLE. Cr. 1894 June 35000 35000^!^ To Balance, .915000 1894 June By Sleamer, By Balance, .^15000 CASH. June To Sundries, C.B., 136 22394 22394 40 40 June By Sundries, C. B, By Balance, ^n 204 6S ;40 1926 22394 40 To Balance, $1926 00 GEO. WEBBER. lune To Freight, To Balance, 138 78 June By Balance, %^^ 00 PASSAGE ACCOUNT. June; 4 To Loss and Gain, 1 40 130 June By Cash, FREIGHT ACCOUNT. June To Loss and Gain, 140 792 792 40 40 June It 2 By Geo. Webber, By Cash, 138 136 78 714 792 40 40 STORES ACCOUNT. June To Cash, 137 127 June 4 By Expense, «39 FUEL ACCOUNT. I10975" 75 ■June, i To Cash, C. B , 137 288 June i 4 By Expense, 139 EXPENSE. June 3 i( 4 (1 4 4 To Cash, C. B., " Stores acct., •• Fuel '• Wages " 137 7 SO June 4 139 127 139 288 140 63 40 48s 90 By Loss and Gain, •Ikk «; < # 140 Dr. WAGES ACCOUNT. Cr, 1894 June To Cash, C. B., " Sundries. 137 138 $45 17 90 50 1894 June 4 §63 40 By Expense, LOSS AND GAIN. June 4 To Expense, «39 $485 90 June 4 By Passage acct., '39 S130 (( i< " G. H. Pope, i3« 218 25 11 4 " Freight " 139 792 40 II >< "/• W. Johnson, I3« 218 25 $922 40 $922 40 EXPLANATION. It will be observed that there is no necessity for a Day Book, and that the Journal is only used to record such transactions as cannot be entered in the auxiliaries. Before posting the C. B., the money received for freights and passae;es is transferred from the Freight and Passage Books to the Dr. side of the C. B,, and the amounts for fuel and wages from the Fuel Book and Hands Register to the Cr. side. In a regular business the hands would in all probability be paid monthly, and would no doubt occasionally require small sums of money, through the month, to defray their expenses. In such case a special column might be kept in the C. B., in which items paid to hands could be charged. We have not space in a work like this to continue the transactions for a whole month, and consequently close the books on reachinf; Montreal in order to fully illustrate the Set. We will now give manuscript for the return trip to be worked out in the same style. The balances may be brought down as is done with the Real accounts, and the return trip posted in the same Ledger accounts. MEMORANDA, STEAMER "CITY OF THE BAY." TRIP I.— FROM MONTRE.\L TO BELLEVILLE, JUNE 5TH, 1894. Engaged P. Graham, as porter, at $12 per month, and J. Reynolds, as fireman, at §30, services to commence to-day. Paid A. Emerson, for 10 tons Coal, at §6 ; 12 cords of Wood, at $5.50 ; A. F. Wood for Provisions, $25 ; E. G. Forbes, for Meat, $8.75. Paid for repairs, $4- Bill of Lading No. 10. — From Alex. Buntin & Co., Montreal, to E. Harrison, Belleville, marked | " E. H., B.," 10 boxes Stationery, 2425 lbs., at 20c. per cwt. Bill ok Lading No. 11. — From Frothingham & Workman, Montreal, to Lewis & Price, Belleville.! marked " L. &P., B," 400 kegs nails, at loc. ; 40 boxes Hardware, 5750 lbs., at loc. petj cwt. Bill of Lading No. 12.— From James Sutherland, Montreal, to J. 0. Overell, Belleville, markeJj ** J. C. O., B.," 4 boxes Books, 1250 lbs., at 250. per cwt.; 6 boxes Sundries, 840 lbs., at 30c.| per cwt. 141 Cr. 863 Uo $63 40 $130 792 40 J22 '40 i that the auxiliaries, transferred .mounts for , and would defray their vhich items to continue )n reaching :ript for the ought down ame Ledger I30, services 10 1 for Provisions, lleville, markeill 'rice, Belleville.] bs., at IOC. pel lleville, markeiil 840 lbs., at J* I Bii.i. OF Lading No. 13.— From J. McKay & Co., Montreal, to M. Empey, Belleville, marked "M. E,, B.," 20 boxes Tweed, 4300 lbs., at 25c. per cwt, ; 10 boxes Sundries, 2460 lbs., at 20c. per cwt. Bill- ok Ladinc; No. 14.— From J. McKay & Co., Montreal, to W. II. Doxsee, Kingston, marked " \V. H. D., K.," 10 boxes Cloth, 3420 lbs., at 20c. per cwt.; 100 boxes Tweed, 18,760 lbs., at 20C. per cwt.; 40 boxes .Sundries, 1275 lbs., at 2Sc. per cwt. Passenokks kkom Montrf.ai,.— W. J. Carman and wife, Ik-lieviile, 89 ; E. I'utts, J. Squires, VVm. [efTs and R. Noon, for IJcUcville, $4.50 each ; E. C. Wartman, K. Sanders, W. M. Parker, A. Brady, S. Davison and 1!. Carper, for Picton, at ^4 each ; Miss Mary Downey, W. C. Niles, G. Golson, S. Grinder and John Ivason, for Kin^jston, )?3 each ; John Turner, C. B. Rogers, Isaac VVeslman, A. Munro and Miss S. Allen, for Gananoque, 82.50 each ; A. Overell and wife, Brockville, ■'?4 ; John Brown, Mary Brown and Jane Brown, for Cornwall, .^1.50 each. Paid Canal Tolls for up trip, $9.60. Bill of Ladinc No. 15. — From Robert Shannon, Cornwall, to Chas. Vannorman, Belleville, marked " C. v., B ," 400 bundles of paper at loc. ; 14 boxes Sundries, 1850 lbs,, at 20c. per cwt. JUNF. 6. — rii.L OK Ladinc. No. 16. — From Pason & Post, Cornwall, to S. Stephenson, Gananoquc, marked " S. S., G.," 80 bundles Waggon Spokes at 60c. each ; 12 boxes Sundries, 3140 lbs , at 15c. per cwt. Bill OK Ladinc. No. 17. — F'rom A. B. Walsh, Cornwall, to J. & H. Carson, Picton, marked **J. & H. C, P.," 25 Iron Ploughs, at 75c ; 25 Harrows, at $l. I'ASSF.NOERS FROM Cornwall, — Isaac Blair, Belleville, $3; Patrick Murray, Kingston, $2; M. Hamilton and wife, Picton, §5 ; Jas. Romheau, Deseronto, $2.75. Bill OK Lading No. 18.— From John Simpson, Prescott, to Geo. Easton, Belleville, marked " G. E., B.," 300 boxes Tobacco, at 15c.; 20 boxes Sundries, 2160 lbs,, at 18c. per cwt. Paid wharfage at Prescott, $2.40. Passengers from Prescott. — George Bull and wife, A. McFee and wife, and R. Thompson and wife, for Belleville, $2.75 each ; Adam Leslie, Deseronto, $2.25 ; R. Botlford, Picton, $2. Paid S. Gorman, for 8 cords of Wood, $44. June S.— Bill OF Lading No. 19. — From H. Bottoms, Brockville. to J. A. Agnew, Kingston, marked "J. A. A., K," 10 boxes Tweed, 3200 lbs., at iSc. per cwt. Bill of Lading No. 20.— From J. C. McGannon, Brockville, to L. II, Henderson, Belleville, marked " L. H. II., B.," 400 sacks Flour, at loc; 800 bushels Wheat, at 5c. Passengers from Brockville.— A. L. Morden, S. Young, E B. Fraleck and M. Jellett, for Belle- ville, at $3 each ; R. Moses and wife, Kingston, $3 ; Miss J. Sanderson and Miss R. Gordon, for Picton. at $2 each. Paid W. Gaffield, for Provisions, $12 60. Bill OF Lading No. 21.— From J. Johnson, Kingston, to Intelligencer Publishing Co., Belleville, marked "I. P. Co., B.," 500 bundles of Paper, 6800 lbs , at 12 cts. per cwt. Bill of Lading No. 22.— From R. Town & Co., Kingston, to W. Dickens, Belleville, marked "W. D., B,," 200 bbls. Apples at 15c. Passengers from Kingston.— J. H. Way and wife, Picton, $1 ; A. Thomas. W. Weaver, R. P. Dowe and Miss D. Lazier, for Deseronto, at $1.25 each ; John Rowe, Belleville, $1.50. Bill of Lading No. 23.— From P. K. Norris, Picton, to R. Dick, Belleville, marked " R. D., B.," 12 boxes Sundries, 3225 lbs., at 15c. per cwt. Passenoers from Picton.— Henry Norris and wife, Belleville, $2 ; Susan Wills, Annie Baker, Mary Sweet, John Porter and Peter Smith, for Deseronto, at 25c. each. Bill of Lading No. 24.— From the Ralhbun Company, Deseronto, to J. Forin, Belleville, marked "J. F., B.," ic.ooo ft. Lumber, at 65c. ■ r M. BouRht for Cash of L. Moody, 15 cords Wood at $4. 9. — Arrived in Belleville, discharged cargo, and paid hands in full for 3 days. Deck Passage, $62.50. Gain for return, $298.61. 142 REPORTING AT THE CUSTOM HOUSE. The arrival and departure of every vessel must be reported at the Custom House or to an officer of customs on the " report inwards " and " report outwards " forms. In going to a foreign port, a " report outwards " must be made out in duplicate, and a " clearance " obtained under the hand of the Collector of Customs. When enterin;^ a foreign port or a home port from a foreign port, the *' clearance " must be exhibited at the Custom House, or to an officer of Customs without delay, and a " report inwards " made in duplicate. Coasting vessels that do not touch at foreign ports simply make out a " report inw.irds coastwise " and a •' report outwards coastwise " These duties, in connection with a steamboat, usually devolve upon the purser, and it is essential that he shall be extremely careful to comply with every requirement of the law, for violations or neglect occasion heavy fines, and possibly seizure and confiscation of the vessel. WHERE VESSELS ARE REGISTERED. On the stern of all vessels the name and place of registration are painted. Every trading vessel must be registered at some Custom House, just as the ownership of land is recorded at the Registry Office. There is one peculiarity about the registra- tion of vessels that is not commonly known ; each vessel is recorded as sixty-four shares. This is convenient where there are a number of owners. Mortgages upon vessels are also recorded and discharged at the Custom House. MlSCELI.ANl CONTIN«EN( MUNICIPAL ACCOUNTS. Municipal book-keeping differs only in form and detail from ordinary mercantile methods of double entry. As Municipal Treasurers occupy positions of public trust, and as the credit of a municipality is an exceedingly sensitive thing, requiring honesty and competence in those who administer the affairs of a corporation, it is exceedingly desirous that municipal books should be kept in a manner at once clear, concise, and comprehensive, in order that the taxpayer or the debenture creditor may at any time inform himself " from the books " of the financial condition, and verify the statements of the auditors. If it is incumbent upon a merchant, who is a private individual, to keep his books after a method and in such a manner as will inspire confidence in his creditors, how much greater is the necessity that municipal corporations, which are continually borrowing, should have their affairs managed by a well defined and thoroughly understood system. The absence of this produces confusion and mystifies the true state of affairs, induces fraud and peculation, and lowers the municipality's credit in the money market, so that it is difficult to dispose of its debentures, except] at a heavy discount. In the Set which follows you are supposed to be commencing a new set of booksl on the basis of the city's assets and liabilities, and bringing truly ascertained balances I forward from the old books. In carrying on the monetary affairs of a municipall corporation, two prominent matters have to be considered, and on these all minorl details depend : they are the yearly estimates of expenditures and the method ofl raising the revenue necessary to meet them. It usually devolves upon thel Chairman of the Finance Committee, aided by the Treasurer, to consider these! matters, and prepare them for submission to the Council, which usually adopts their rcrommcndations. We will suppose that the following is the KSTIMATRI) EXrENDITIIRK. Interest, Commission and Exchange, .... Market Buildings, .... City Hall, ' " *. ■■■' Market Square, ... .... .... ] ] Market No. 2, ]], "" Insurance, .... ... .... ..,. [ [ I'olice Department, .... .... ... .... " * I'uhiic Schools— appropriation for 1886, , ,, ,[ Fire Department, .... .... .... Lighting Streets, .... " ' * ' Salaries, .... .... . . ... [ ' Streets, .... ... .... I'uhlic Park ' " . Printing and Stationery, .... .... .... Election Expenses, ... ... ... .... Miscellaneous Property : New Hose, .... ... .... .... Water Sprinklers, .... ... . . .... .... Interest on debentures, is.sue of 1st April, 1876, .... .... Interest on debentures, issue of I St August, 1880, To pay County of Windsor on account of award ... .... • • • . . « 2,338.32 70000 1,720.00 850.00 50.00 600.50 8,544.87 11,500.00 3,710.00 2,155.00 7,500.00 13,320.9c 356.00 .... . . . 900.00 438.00 $ 600.00 45.00 645.00 2,IQO 00 7,000.00 9,ioo.oc 25,040.00 c % ^m Contingencies : Prop, of Jury Expenses, 1885, #i,902..sS Support of prisoners in gaol, .... .... ... .... 4, 130.00 Appropriation High School, .... .... ^gg. 75 " Collegiate Institute, .... .... .... 375.(0 " General Hospital, .... .... 200.00 *• to compensate John Smith for loss of property by Fire, 275.00 " to compensate J. Brown for injuries received as fireman, 252.50 Post-Mortem examination and medical evidence .... 250 00 Law Expenses, ... 100.00 Pauper Passages, .... .... .... 200.00 Coffins and Interments, .... ... .... .... 50.00 Bill Posting, 2000 Postage and Telegrams, .... .... .... .... 30.00 Kegistraiion, .... 115.00 Taking Census, ... .... .... . . ... 100.00 Dog Medals, ,,.. .... .... .... .... 41.05 Incidentals, , .... 775.75 * Estimated Expenditure ... ... .... You will now proceed to find out what the revenue will likely be. ESTIMATED REVKNUE. $89,468.60 9,3«S.63 $98,784.23 Surplus of Revenue over Expenditure, 1S85, Rents, .... .... Licenses, .... Fines Police Court, .... .... Clergy Reserve Fund, .... Taxes, lands of non-residents, .... Gravel Road, section of .... Instalments on Lots sold, .... F'rontage, ... .... Dominion Government for Public Clock, . . . .... $2,736.99 — 6.206.70 11,296.10 1,000.00 — 600.00 200.00 73.62 1,139.06 — 292.50 — 430.00 $23,97497 ' Note.— The Sinking Fund Levy is omitted this year, for the reason stated in explanatory notes at the end of Set, 144 The (liflcrence between the above revenue and tlie eitimated expenditure hai to be raised by taxation. We will suppose that the assessors have completed their work and placed the asscssaiile property of the city at 85ill3<246. •8i, 79593 A rate of i6 mills on the Dollar will amount to Less S. Schools Remissions Uncollcctabie Jl, 600.00 3,000.00 500.00 Total Revenue Estimated Expenditure 5,100,00 76,695.93 .... 1^100,670.90 98.7S42.? lJi,8S6.67 .Surplus .... .... .... .... 'I'he preceding revenue and assessment will cover the expenditure, and leave the above surplus. Occasionally it becomes necessary to raise money for special objects, such as improvements of various kinds, buildings, bridges, etc., the cost of which it is desirable to spread over a number of years. To do this, resort is usually had to the issue of Debentures, which are promises to pay of the nature of notes of private individuals or firms, differing only in form. These sell at a premium, par, or discount, according to the interest they draw, the length of time they have to run, or the credit of the municipality offering them. They are frequently made payable in 20 years, with interest half yearly. Attached to each debenture are interest coupons which the holders at the proper time detach and present for payment. When a municipality issues debentures, it usually provides for their payment by creating a " Sinking Fund," deposit or investment, obtained from a special rate levied yearly for the purpose; and this fund, when wisdom and prudence are characteristic of the management, is held intact for the purpose for which it was created. A good plan for creating this fund to retire debentures that are to run 20 years, and pay the interest upon them, is to levy the amount of the yearly interest and 5 per cent, of the total debenture issue each year of the 20 years, the latter to be deposited or invested, and at the end of the time the whole capital sum will have been accumulated and the interest duly met. The interest accruing from the Sinking Fund deposit or investment you regard, and use, as any other yearly income. For example, debentures to the amount of $30,000 are issued, payable in 20 years from date, with interest at 6 per cent.; if you levy $1800, and 5 per cent, of $30,000, which is $1500, yearly for 20 years, pay the interest with the former, deposit or invest the latter, using the interest it produces as a yearly income of the corporation, you will at the date of the maturity of the debentures be in possession of the sum necessary to retire them, and will have duly met the interest periodically. Sinking Funds are sometimes dealt with differently from the method indicated above. The Ontario Municipal Statute requires that such a sum shall be levied yearly as will, capitalized at 5 per cent, produce the amount borrowed when it becomes due, Example, suppose the City of Belleville desires to raise $90,000, payable in twenty years. To find the amount you must levy for Sinking Fund, proceed by this rule: Find what $1.00 will produce levieid yearly for 20 years, and interest on the fund at | 5 percent. This gives $33.06682639; then if $1.00 produces $33.06682639, howi much will it take to produce $90,000 ; as much as times that sum is contained in | $90,000 ; which is $2721.76, to be levied yearly. The levying and coHecting'of this Sinking Fund are not all the important features! connected with it. It is highly important that an account in your Ledger should show at its debit the amount of this fund. It will not do to only collect the amount, 149 ilcliit cash and credit tax account. In that case, the money poes into the Rcneral Hinds, and would be used for general purposes. You must take from the roilcclions at certain times tlie proportions properly bcloniiinp to this fund, and cither deposit it in a bank or invest it in a ;j;ood security. The Sinking Fund account in tlie Ledger «ill be debited with the sums invested for this account, showing an existing tangible asset. It is sometimes desirable to provide a Sinking Kund for each of the several issues of debentures when the whole debt is not consolidated. The i^rincipal books of entry required in this Set are, Cash Hook, Journal and i.eilger, and the minor books, Debenture Rcj^'istcr, somewhat after the form of a Hill Book ; a Warrant Hook in which the authority of the Council for the payment of nccounts is entered, ''nch ono of which is consecutively nimibered ; a Receipt liook in which receipts are entered, each bearing a corresponding number with the authority for payment in the Warrant IJook ; a Nonresident Tax iSook giving the particulars respecting the lands of non-residents, the taxes on which the Treasurer usually I collects, and any other minor books or forms which pecidiar circumstances may I demand. The method of dealing with the Collector is an extremely important considera- hionin municipal matters, for upon the prompt collection of taxes, and the no less prompt handing over by the Collector to the Treasurer of the money, depends the |satisf.ictory running of the municipal machine in accordance with the estimates. If the Collector be allowed to retain the money in his possession, and at his Iconvenience pay over to the Treasurer such sums as he may choose, it is quite lapparent that an opportunity for other than honest dealing is afforded. It is desirable Ithat K\cii DAY the Collector should pay over to the Treasurer all sums of money Icollected by him, exhibiting at the same time in a book kept by him for the purpose, lor from stubs of his receipt book, the names of the parties from whom it has been Jreceived, and the amounts, which should be checked by the Treasurer, and a recei|)t piven, in the book, for each day's collections. This course will obviate the necessity of opening an account with the Collector in the Ledger, a plan which, although pursued in some places, is not adopted in our principal cities, for reasons given in [lie explanations at the close of the Set. At the close of each year the Collector khould be required to make an interim return of taxes remaining uncollected at that lime and for that year, the total amount of which, and the money paid over, would pactly tally with the tax rolls ; then, after the lapse of considerable time, when it is pot possible to collect any more of that year's taxes, he should make out a final return knd be relieved of further responsibility. Having so much premised for your general niformation, you will now proceed to open the Set by journalizing the assets and liabilities. i^See form of Journal.) After journalizing, you will open accounts in the Ledger under the names of these titles used in the Journal, and proceed to post the kerns; this being done, you are ready to proceed with the current work of the year, Is you are aware, there must be an account under some name in all double entry [ook-keeping, to keep the Ledger in balance, or show capital. In this set use " City |f Ontario " account for this purpose. You will observe that on the start this account hows $10,553.65 at its debit, which of course means that the city's liabilities exceed Is assets by that amount. I {See the fuller explanations at the end of the Set, : ♦ . 146 JOURNAL. City of Ontario, Janttaiy, iSS6. I.. F. 154 Sundries Dr. to City of Ontario account.* 154 Cash Acct. 1' or Balance on hand, $ 250 00 «54 Molsons Bank. For amt. on deposit, 395 85 154 Real Estate. For value of City Buildings and Lots D., B. and C. in Victoria Ward, S7O0O 00 »54 Property Account. For miscellaneous jjroperly, as detailed in Schedule A., B. and C, on file in this office. 45000 00 »S4 Sinking Fund No. i. For amount on deposit to meet accruing debentures of the issue of ist April, 1876. 15300 00 »54 Rents Receivable. For sundry amts. owing 1st Jai uary, 18S6, as per state- ment on hie in this office. 274 SO '55 Non- Resident Taxes. For ..mount outstanding and considered good as per non- resident Tax- Book, 897 00 «5S Taxes, 1885. For outstanding Taxes as per Collector's interim return to 1st January, 1886, 25329 00 '55 Sinking Fund No. 2. For amt. on deposit to meet accruing debentures of the issue of 1st Aug., 1880, 30000 00 174,44613; 154 155 City of Ontario Acct. Dr. to Sundries.t Debenture Acct. For issue of 1st April, 1876, as per Register, " 1st Aug., 1880, 30000 I 000000 00 00 1 «S5 Bills Payable. For Note No. 5 under discount, due ist July, 1886, 20000 00 1 i i i >55 County of Windsor. For amt. owing it, as per Arbitrators' award. 6b^^ 00 i 185,000 8 * This entry represents the City's assets on the ist Jan., 1886, 1 t This entry represents the City's liabilities on the ist Jan., 1886. I,. F. 154 *Cash 155 Taxes, For. ij- \ Rents '. For J "S-l Molson For( '55 License I- or J 154 ■56 Sundrie Indigen For p 156 Interest For pay 156 Streets ^ For pj 156 Fire Dep For pa 156 Thos. M P'or p: '55 County c For ps 155 Election For pj 154 Molsons I-or de 156 E. Robi For pj '57 Continge For pa 57 Fuel Ace For pa 54 Property For pa *Ca nelhod c roiii Cas sh is Journ fjournalizi > Ijook intfl 147 JOURNAL— Continued. City of Ontario, yannary, 1 886. tn', i8S6. ■ = 154 ■55 154 154 155 154 1156 1,6 1^6 ■56 156 '55 |i55 I154 156 57 F57 P54 *Cash Acer. Dr. to Sundries. Taxes, 1885. For January receipts as C. B , Rents Reeceivable. For January receipts as per C.H., Molsons Bank. For Checks drawn in January as C. B., Licenses Account. tor January receipts as C. B., Sundries Dr. to Cash Account, Indigent Account. For payments in January as C.B., Interest Acct. For payments in January as C.B., Streets Acct. For payments in January as C.B., Fire Dept. Acct. For payments in January as C.B., Thos. McNaughton. P'or payments in January as C. B., County of Windsor. For payment in January as C.B., Election Exp. Acct. For payment in January as C.B., Molsons Bank. For deposits in January as C.B., E. Robinson. For payment in January as C.B , Contingent Acct. For payments in January as C. B., Fuel Account. For payments in January as C. B. , Property Acct. For payments in January as C.B., M4339 627 504 5SS '03 350 2403 282 45 3000 409 8000 100 25 '95 984 65 50 50 00 74 00 10 95 00 00 00 00 00 CX) 50 20 $16026 65 ( $15898 I 49 * Cash is Journalized from the Cash Book at the end of each month in this Set. We have done this to illustrate the fethod of journalizing from Cash Book ; b\it there is no necessity for journalizing Cash, as it might be posted directly lorn Cash Book into Ledger, as is done in Sets IX and XI. ♦ ; 148 JOURNAL— Continued. City of Ontario, January, iSS6. L. F. 157 Sundries Dr. to Assessment Acct. Ward. 157 «55 «S7 '57 >57 >57 >55 Value of Real Property. Value of Personal Property. Total Assessment. Statute Labor. Dogs Total amount of Taxes. Taxes, i886. For Dog Taxes, $50.00 " Statute Labor Taxes, 78.00 '• Resident Taxes, $5,072,246 at the rate oi 16 mills on $ 81,155.93 Non- Resident Taxes. For Taxes on lands of non-residents, §40,000 At the rate of 16 mills on $ Total Assessment, $5,112,246 Total Taxes, Corresponding with above abstract '. ">> Assessment Rolls duly certified jy u. 'o .. Assessment Acct. Dr. to Sundries, Taxes, 1886. For remissions and deductions made by Court of Revision as per City Clerk's Remission book, folios 43 and 44, certified by auditors, $2575.00 For proportion of Separate School Tax as noted on Assessment Roll, 1729.00 Public Schools Account. For appropriation for 18S6 as applied for by the Board of Education as per their Budget submitted to City Council, Bonus Acct. Dr. To Debenture Acct. For 20 Debentures for the sum of $500 each, issued to the Ontario Rolling Mills Co. with the sanction of a majority of the Ratepayers obtained by vole on the 3rd day of January, 1886, and confirmed by the Council on the 5th day of the same month and year, payable in 10 years from 1st January, 1886, with interest at the rate of 6 per cent, per annum, and duly entered and numbered C. i to 20 in Debenture Register. J1.283 640 4304 11,750 10,000 93 00 00 00 00 $81,923 $16,054 $10,000 I.U Rents 6 155 License! 157 Police C 158 Clergy ] '55 Non- Re '58 Gravel '54 Real Es 158 Frontagt 158 Dominic '57 Taxes, i '55 Taxes, i 149 JOURNAL— Continuad. \ry, 1 886. City oj Ontario, January, 1886. I„ F, '55 154 154 |i55 |i57 1158 |<55 y 1154 I58 I5S 157 City ok Ontario Acct, Dr. To Bonus Acct. For amount of Bonus (granted to the Ontario Rolling Mills Co. transferred. February, 1886. Cash Dr. to Sundries. For receipts in February as per C. B. Rents Receivable Licenses, . . . , ... .... Police Court, Clergy Reserve, Non-Resident Taxes', Gravel Road, Real Estate, Frontage, .... ... Dominion Government, Taxes, 1886, Taxes, 1885, 51 56 58 58 ¥ h h h Is? h m r r 55 (4 Sundries Dr. to Cash. For payments in February as per C. B Interest, Market Buildings, .... City Hall Market Square, .... Market No. 2, .... Insurance, .... Police Department Public School, , Fire Department, . . Lighting Streets, ... Salaries, .... T. McNaughton, E. Robinson, ... Streets, Public Park, Printing and Stationery, County of Windsor, Contingent, ... Molsons Bank, §10000 5500 10700 960 600 450 73 1050 250 430 5755° 1 0000 $ 8750 720 1700 850 48 600 8540 11750 3420 2129 2480 955 900 10900 329 928 22000 9429 lOTO 00 00 00 00 00 62 00 00 00 00 00 .^lOOOO 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 50 00 00 00 00 •Wk It,' $87563 62 $87428 50 150 JOURNAL— Continued. City of Ontario, February, i8S6. — ^ -J You dc L. F. "^ the reason is «59 Salaries Acct. Dr. to Sundries. carried on, •56 T. McNaugnton, for Salary, 1886, $1000 00 department 156 E. Robinson, 1000 00 $ 2000 receiving an 00 • • , , Note. — The foregoing journal entries having been posted, you will now take off Trial Ualance to prove correctness of work, after which = original entri opportunity, close the working accounts into revenue as per following journal en- tries. in a full an proper, to ke '59 Sundries Dr. to Revenue Acct. 1 1 / other matters For amounts transferred to close working accounts for 1886. Monthly 154 '55 Rents Receivable 5853 "255 00 suited to mui Licenses, ... 00 each entry fo 157 Assessment, . . . . .... 65869 93 fournal thes 157 Police Court, 960 00 iggregate trar 158 Clergy Reserve, . . . .... 600 00 make for 158 >58 158 Gravel Road, Frontage, .... Dominion Government, . .. 73 250 430 62 CXJ 00 -edger. We ;ash Book, b( 85291 t would be q ~Bournal and Ihe stubs are '59 Revenue Acct. Dr. to Sundries. ■ournal first it For amounts transferred to close working accounts for ■he books. ^ 1886. Bave been firs 156 Indigent, .... .... $ '03 74 ■nd Ledger « '56 Interest, . . 9100 00 ■ournal, take 156 Streets, '3303 10 ■ecord of trans 156 156 Fire Department, Election Expense, 3702 409 95 00 Bxplanations tl '57 Contingent, 9454 00 ■nes if neces! 157 Fuel, '95 50 Iccompanied 1 '58 Market Buildings, 720 00 ■ocument, paj 158 City Hall, 1700 00 H> these is sufif 158 Market Square, 850 00 159 Market No. 2, 48 cx> 1 "Fuel A '59 Insurance, 600 00 ■fers to the C '59 Police Department, . . . 8540 00 Brits pay men Bgregate of a '59 '59 Lighting Streets, Salaries, .... 2129 4480 00 00 '59 Public Park, 329 00 Boceed to jou '59 Printing and Stationery, ... • . . . 928 50 Btal debit and 56592 ^jm the month, "■quired (as d '59 Revenue Acct. Dr. 28698 76 Burnal are pt »S4 To City of Ontario Acct. $28698 iBncerned, is c B furnish an ii For amount transferred to close acct. 151 JOURNAL AND CASH BOOK. You do not use whiit is ordinarily called a Day Book in this set of accounts, and [the reason is obvious. In mercantile business, or when any kind of trade is being carried on, of course a book of this nature is desirable, but in the Treasurer's department of a municipality there are few transactions occuring other than the Ireceiving and disbursing of money, and hence the Cash Book should contain the loriginal entries of these ; the form of Journal which is here used affording you the lopportunily, when the necessity arises, to make entries other than those affecting cash |in a full and comprehensive manner. It may be desirable, and would be quite Iproper, to keep a memorandum book in which to write the particulars of rents or lother matters until you are prepared to journalize. Monthly journalizing ot Cash and all other entries, as here pursued, is admirably Suited to municipal book-keeping in this form. At a glance the Cash Book shows pach entry for the month in detail, with explanations as full as desired ; and in the journal these are grouped under the names of the accounts affected, and in the Aggregate transferred to the Ledger ; while any other entries that it may be necessary \o make for the month follow in the Journal, and are likewise transferred to the Ledger. We put checks drawn upon, and deposits made in the bank through the ]ash Book, because it is desirable to show all details of cash transactions in one book. |t would be quite proper, however, if preferred, to confine the record of checks to the lournal and Ledger. The numbering of checks, and the preservation of them and Ihe stubs are matters which should receive your attention. We have placed the lournal first in the Set, as its first page is taken up with the entries necessary to open Ihe books. Were there no opening entries to make, of course the Cash Book would fcave been first in order. You will, however, act as though the Cash Book, Journal Ind Ledger were separately before you, and having studied the first page of the lournal, take the Cash Book as next in order. In it you are supposed to have the ecord of transactions clearly and distinctly made. If it be desirable to make longer xplanations than any of the examples given, make them ; use half a dozen or a dozen Jnes if necessary, for this is the book of original entry, and each one should be ccompanied by full and clear information. Where reference can be made to some [ocument, paper, or book giving explanation or authority, of course a simple reference I these is sufificient, as for example taken from Cash Book : — " Fuel Account," "J- ^- Warren's account for coal as per warrant No. 2 " kfers to the Coal Merchant's account, and by number to the warrant of the council fcr its payment. The Cash entries for the month being made, you will ascertain the fegregate of amounts to be debited or credited respectively to each account, and roceed to journalize these (as done on page 147) ; taking care when journalizing the [tal debit and credit of each, not to include the balances. Having journalized Cash |r the month, your next business is to make any other journal entries that may be Iquired (as done on page 148), and when they are made, and the items of the lurnal are posted to the Ledger, the month's work, so far as the books are [ncerned, is complete, and you are prepared, as required by many municipal bodies, 1 furnish an intelligent and intelligible statement of the month's transactions. c ■ ' I 152 Dr. CASH I BOOK 1886 Jan. Feb. 7 9 12 IS >7 21 (I 22 23 26 27 << 30 To Taxes, 1886, " Rents Rec.,'. " Taxes, 1886, " Molsons Bank, " Licenses, To balance on hand as per asset entry in Journal, Amount as per receipt No. I given Collector, J, Armstrong Market fees 3 mos. in D(lvance» Amount a? per receipt No. 2 given Collector, Check No, i, William Wilson, $75.00 John Purdy, 7S'00 Win. Redmer, 100.00 Jas. Todd, ico.oo T. Hamilton, 20.00 John O'Hara, 5.00 M. Sullivan, 5.00 Tavern License, Saloon It i( Auctioneer" Cab, " Taxes, 1886, " Molsons Bank, '* Taxes, 1885, " Licenses, As per receipts Nos. 3 to 7 given to Collector, Amount as per receipt No. 8 given Collector, As per receipts Nos. 9 to 12 given Collector, Check No. 2, Amount as per receipt No. 13 given Collector. Tavern License, J. Brodie, 7S-oo Billiard " A. Norris, 100.00 Taxes, 1886, Rents Receivable, Taxes, 1886, To Rents Receivable, " Licenses, " Police Court, " Clergy Reserves, " Non-resid't Taxes, " Gravel Road, " Real Estate, •« Frontage, " Dominion Gov'nt., " Taxes, 1886, " Taxes, 1886, Amount as per receipt No. 15 given Collector, Lessee of Lot on Water Street in full for 1885, Amount as per receipt No. 16 given Collector, Entries Journalized, folio 147. To balance brought down. For balance of collections for 1886, " Fines for year 1S86, " Income from that source for 1886, '■ Collections for 1886, " Income from that source for 18S6, " Lots sold in 18S6, " Income from that source for 1886, " Allowance for lighting clock, " Collections, 1886, " Balance ot collections in 1886, Entries journalized, folio 149. (See explanation given at the end of Set for making Receipts so large in one month). $ 250 3200 495 575 45 380 5400 1500 2500 459 432 «9S \m CO Ian. I 00 3 50 7 00 7 00 9 10 12 '5 18 00 00 00 175 00 394 60 132 00 142 30 $16276 65 378 16 5500 CO 10700 00 960 00 600 00 450 00 73 fc 1050 00 250 00 430 00 57550 M 1 0000 00 $87941 ;i Feb. 21 23 00 50 25 30 25 00 28 30 << 1< (I (See 108 CASH I BOOK. Cr. 250 GO ■ 3200 00 1 495 so 1 575 00 1 45 00 ■ 175 00 394 60 132 00 142 30 — $16276 65 378 ~\k 5500 CO 1886 Ian. 380 1 5400 00 ■ 1500 00 I 2500 00 H 459 50 1 432 So| «95 ^:| jj — 10700 4 960 00 ■ 600 00 H 450 00 ■ 73 6:| 1050 .. 250 M I 430 00 1 57550 00 1 1 0000 00 1 I 3 7 7 9 10 12 15 18 il 21 tt 23 25 25 28 30 Amount paid as per Relief Committe order, Coupons Debentures A, Nos. i to 20, Prop, of Pay List No. i, By Indigent, " Interest, " Streets, "PlreDept., " ThOS. MoNaUghton, Checi< No. I, account salary, " County of Windsor, Payment on account of award, " Blection Bxpense, As per Clerk's receipt. " Molsons Bank, " Indigent, " B. Robinson, " Streets, " Fire Department, " Contingent, " Fuel, " Streets, " Property, " Molsons Bank, Amount deposited, Amount paid as per Relief Committee order, Accouiu salary. Prop, of Pay List No, 2, li (( it Expenses of deputation to Toronto, as per Warrant No. i, J. B. Warren's account for coal as per Warrant No. 2, Lumber }. Morden & Co., as per War- rant No. 3, Hose. R. Volney & Co., as per Warrant No. 4, Amount deposited. Balance, ,$87941 By Interest Acct., " Market Buildings, " City Hall, *' Market Square. " Market No. 2, <• Insurance, " Police Dept., " Public Schools, " Fire Dept.. " Lighting Streets, " Salaries, " T. McNaughton, " B Robinson, " Streets, *' Public Park, " Printing and Sta'ny, •' County of Windsor. " Contingent, " Molsons Bank, Entries Journalized^ jolio 147, For Balance of payments in 1886, For payments in 1886, «( For appropriation for 1886, paid in full, balance of payments in 1886, payments in 1886, <> •• bal. of salary for 1S86, " payments in 1886, payments in 1886, tt It " on account of award, balance of payments in 1886, Deposit, Balance, Entries Journalized, folio 149, 5 23 350 410 193 45 ;iooo 409 5000 79 100 397 89 25 195 1595 984 3000 378 16276 8750 00 720 00 1700 00 850 00 48 00 600 00 8540 CO 1175c 00 3420 00 2T29 00 2480 00 955 00 900 00 10900 00 329 00 928 50 220CO 00 9429 CO 1000 00 5>3 28 $87941 90 00 00 00 00 00 00 00 84 00 50 96 00 50 60 20 00 16 (^5 78 All •113 '1 (See explanation given at the end of Set for making disbursements so large in one month.) In Dr. 1886 Jan. Jan. (I Feb. Jan. ti Feb. Jan. 154 LEDGER. CITY OF ONTARIO. ;•: O. To Sundries, " Bonus acct. Balance, 1886 146 185000 00 Jan. 149 lOOOO 814s 00 II II FeL. 20314s By Sundries, '* Revenue acct. By Balance, 146 '5° 174446 , 35 28698 76 203145 II CASH ACCOUNT. To Cily of Ont. ac. " .Sundries, '• Sundrie^^, To Balance, 146 250 00 Jan. 147 16026 65 Feb. '49 87563 62 27 103840 By Sundries, " Sundries, Balance, 5'3l 28 MOLSONS BANK. To City of Ont. acct. " Cash acct.. 1 1 «» To Balance, 146 147 395 8000 85 00 Jan. '49 1000 00 9395 By Cash acct., Balance, 8891 I 35 REAL ESTATE. To City of Ont. acct. To Balance I 146 570CO 00 00 Feb. 57000 By Cash acct.. Balance, 55950 I 00 PROPERTY. 147 '49 '49 8145 i .: 15898 49 87428 50 5'3 28 103840 I 27 Jan. To Cily of Ont. acct. "Cash acct., 146 147 45000 984 00 20 20 Balance, 45984 20 20 45984 45984 ♦To Balance, s 45984 1 20 .INKING Fl QND No. I. Jan. To City of Ont. acct. 146 15300 1 00 1 RENTS RECEIVABLE. Ian. Feb. To City ol Oni. acct. '* Revenue acct. 146 149 274 5853 6127 50 00 50 Ian. Feb. i;y Cash acct., 11 >< "47 149 627 5500 5° 00 5?. ,. 6127 Dr 1886 Jan. |To Ci Jan, To Cit] 147 504 8891 50 Ijan. 1 9.395 "• ToCa STREETS. Jan. Feb. To Cash acct., tt it 147 •49 2403 1C900 10 00 10 Ftb. Hy Revenue acct.. 150 •3303 10 Jan. 10 To Ass •3303 •3303 FIRE DER lENT. 1 Jan. Feb. To Cash acct., TI 1 •47 •49 iOS. 282 3420 95 00 95 Feb. By Revenue acct., •SO 3702 — • 1 9i 1 Tc 3702 3702 9) Jan. To Sunc " Reve McNAUGI iTOh r (City Clerk). Feb. Tan. Feb To Cash acct.. •47 •49 45 955 00 00 CX) Feb. By Salaries acct., •50 1000 00 1000 1000 ELECTION EXPENSE, Feb. To Cash Jan. To Cash acct., •47 E. 409 00 Feb. (City By Revenue acct., Treasurer). 15c 409 ROBINSON ) an. 1 To Debe Jan. To Cash acct., •47 •49 100 900 00 00 Feb. By Salaries acct., •Sc ) ICOO 1000 - -Ma 1 ro Reve 1000 00 ' Dr. 187 CONTINGEN'I 1 * Cr. 103 74 1886 Ian. Vel'. To Cashacct., •t t< !• 147 149 • 25 9429 00 00 00 11886 Feb. By Revenue acct., 1 9454 GO $9454 QdCd nn 1 9100 00 FUEL. 1 00 Jan. To Cash acct. 147 «95 50 Feb. By Revenue acct.. 150 "95 910 SO TAXES . 1886. 13303 , 10 1 Jan. To Assessment acct. 148 81283 93 1 93 fan. Feb. By Assesssment oc. " Cash acct., Balance, 148 149 4304 57550 19429 00 00 93 13303 ' ic 8 128 J 81283 9? 3702 9 To Balance, '9429 1 93 ASSESS MENT. Jan. Feb. To Sundries, " Revenue acct. 148 150 16054 65869 00 93 93 Jan. By Sundries, 1 148 3702 ■ 81923 93 3 1000 1000 81923 81923 93 . PUBLIC S CHOOLS. Feb, To Cashacct., 149 1 1750 00 !jan. By Assessment acct. 148 1 1750 00 ;o 409 BON US. an. To Debenture acct. 148 1 0000 00 Jan. By City of Ont. act. 149 lOOOO 00 50 icoc POLICE COURT. 100 i To Revenue acct., ISO 960 00 Feb. By Cash 9QCt„ 149 960 00 ll» J Dr. 158 CLERGY RESEKVF:. ;• Cr, 1886 Feb. To Revenue acct., "SO 1886 Feb. Uy C«*h acct., 149 00 18S6 Fel.J ToC GRAVEL ROAD. Feb. To Revenue ncct., 'SO 73 62 Feb. By Cash acct., 149 ToCi i FRONTAGE. ^eb, Feb To Revenue acct., By Cash acct , 149 ToCai DOMINION GOVERNMENT, I'd). I ToCas Feb. To Revenue acct., By Cash acct., 149 Feb. MARKET BUILDINGS. To CasI " Sum Feb. To Cash acct., 149 720 00 Feb. By Revenue acct., '50 -720 00 CITY HALL. Feb. To Cash acct., '49 1700 00 Feb. By Revenue acct. «S0 1 70c 00 Feb. To Cas Feb. To Cash MARKET SQUARE. Feb. To Cash acct , 149 Feb. By Revenue acct., 150 850 iFeb. To Sunc " City i8S6; Fell.' To Cath acct. , •v To Cash acct., hb, To Cash accl., [■'cb. Feb. Feb. To Cash acct., Feb. To Cash acct., MARKET No. j. By Revenue acct., INSURANCE. By Revenue acct.. ISO' 600 00 POLICE DEPARTMENT. 149 By Revenue acct.. LIGHTIN(; STREETS. To Cash acct., 149' 2129 00 Feb. By Revenue acct.. SALARIES. To Cash arct., " Sundries, 149 150 2480 2000 00 00 4480 00 1 Feb. i By Revenue acct.. ISO 4480 4480 00 00 PUBLIC PARK. By Revenue acct., PRINTING AND STATIONERY. By Revenue acct., REVENUE. .- : iFeb. To Sundries, '• City of Ont. acct., «5o 150 56592 28698 85291 79 76 55 Feb i 1 By Sundries, 160 ♦TRIAL BALANCE. i Fol. Account. Dr. Cr. «S4 City of Ontario, $ 20553 65 •54 Cash, 5'3 28 '54 Molsons Bank, ... .... .... .... .... 8891 35 •54 Real Estate, .... 55950 00 154 Property, 45984 20 «54 Sinking Fund No. I .... ... . . .... 15300 00 >54 Rents Receivable, ... « 5853 00 '55 Non-Resident Taxes, 1087 00 155 Taxes, 1885 989 35 155 Sinking Fund No, 2, 30000 00 155 Debenture account, 140000 00 155 Bills Payable, 20000 00 •S5 County of Windsor, lOOOO 00 155 Licenses account 11255 00 156 Indigent account, .... .... .... . . 103 74 156 Interest account, .... .... .... .... 9100 00 «56 Streets, 13303 10 156 Fire Department, 3702 95 156 Election Expenses, .... .... .... .... 409 00 157 Contingent account, .... .... .... 9454 00 157 Fuel account, 195 50 157 Taxes, 1886 19429 93 157 Assessment account, .... .... ... 65869 9,1 >57 Police Court, 900 00 158 Clergy Reserve, 600 00 158 Gravel Road, 73 62 158 Frontage, 250 00 158 Dominion Government, .... .... .... .... 430 00 158 Market Buildings, 720 00 ~*J 158 CityHall, 1700 CO '58 Market Square, 850 00 159 Market No. 2, 48 00 »59 Insurance, 600 00 159 Police Department, 8540 00 >59 Lighting Streets, ... . . 2129 00 159 Salaries, 4480 00 '59 Public Park, ... 32 00 «59 Printing and Stationery, .... ... .... 928 50 Ji $255291 55 8255291 * This Trial Bal.ince e.Yhibits the balances of the account.s, not the footings. Ledger Folio. '.S4 Cs IS4 M '54 R< '54 Pr 154 Sii >.SS Nc '55 Ta i.SS Sir '57 Ta Owing this kind, cu compress int month, howt in order to b year, aggrega these aggregz manner of, t Tiie me your carefu i in the Ledge j when the Asi Collector's I of course pas I remissions ar ascertained fi you by the A the data froir I on page 148 of the Counc j till Decembe I You will see I accurately ea I have been co I shown by the I before) at th jaccount for o Itheroll like)) ■probably afte |account. The blai [abstract, the j rhich it ough 161 ASSETS AND LIABILITIES. STATEMENT. Ledger Folio. Assets. Ledger Folio. Liabilities. "54 154 154 •54 154 '55 ■55 >55 157 Cash, Molsons Bank. Real Estate, Property, Sinking Fund, No. i, Non-Res. Taxes, Taxes, 1885, Sinking Fund, No. 2, Taxes, 1886, 5'3 8891 55950 45984 15300 1087 989 30000 19429 28 35 00 20 00 00 35 00 93 155 155 155 •54 Debentures, Bills Payable, County of Windsor, City of Ontario, being balance showing amount of assets over liabilities. 140000 20000 1 0000 8'45 00 00 00 II «i78i45 II $178145 II EXPLANATORY NOTES. Owing to the limited space which any one set of books may occupy in a work of this kind, curtailment is of course a necessity, and hence we have been obliged to compress into two months what ordmarily would be spread over a year. In the first month, however, ordinary receipts and expenditures are recorded, but in the second, in order to be in a position to instruct you how to close the books at the end of a year, aggregate sums for the balance of the year arc entered ; for the months which these aggregate sums represent, our entries would be similar to, and made after the manner of, the examples given in the first month. The method of making the assessment entry is important, and should receive your careful attention. It is desirable, as you will presently see, that there should be» in the Ledger, a Tax account for each year ; the proper time for opening it being when the Assessors have completed their work, and the Assessment Rolls are in the Collector's hands, and money is being paid on its account, the hums so received being of course passed to its credit. Afterwards, when the Court of Revision has made all remissions and deductions and these, properly certified by the Auditors, have been ascertained from. the City Clerk's remission book, and the Rolls have been handed to you by the Auditors with their certificate of correctness, you will be in possession of [ the data from which to accurately make the Assessment entry, in the manner shown on page 148. As Auditors for any past year are not appointed till the first meeting of the Council for the succeding year, your assessment entry is necessarily delayed till December, hence the necessity of the year's tax account being opened before then. You will see that in making; the assessment entry in the forrn prescribed, you show accurately each year's revenue within the year. All the taxes for the year will not have been collected at the time you make the entry, but the amount outstanding is shown by the balance (corresponding with the Collector's interim return mentioned before) at the Tax account's debit when you close the books for the year. The Tax account for one year should be kept open just so long as there are unpaid taxes on Ithe roll likely to be collected. When it becomes impossible to collect any more, Iprobably after the lapse of a few years, it should be closed into City of Ontario |account. The blank form given in the assessment entry, page 148, is used to show, in labstract, the amount of the various taxes on the Assessment Rolls, with the totals of jwhich it ought of course to correspond. « 162 If you will consider the assessment entry, the foregoing explanations, and what is said on page 145 regarding the method of dealing with the Collector, you will perceive the advantage afforded by separate yearly tax accounts in securing prompt returns, clearly defined and reliable records of each year complete within itself, and the prevention of a lax system, either on the part of the Treasurer, Collector or other official. The reason why we have adopted the plan of dealln!^ mih the Collector here pursued, instead of opening an account for him in the Ledger, and debiting him with the amount of the Assessment Rolls placed in his hands for collection, and crediting him with sums collected for taxes, is that we have observed in more than one instance, where the latter system is in vogue, the absence of promptness in making returns ; and what follows as the natural result of this, an unsatisfactory condition of affairs between the Collector and the city, and in the Treasurer's books, laxity, incompleteness, and a deceptive and unreliable state of the accounts. We are acquaint- ed with the books of one municipality, in the Ledger of which there stands at the debit of the Collector a sum of over $100,000, brought down as a balance from the previous year ; the Collector not having returned the Assessment Rolls for three years, and no attempt having been made during that time to effect a settlement with him, In the method we adopt, we recognize but one Treasurer, and treat the Collector simply as a channel through which the daily collections of taxes reach his hands. The bonus granted to the Ontario Rolling Mills Co. is charged to Bonus account (see Journal 148) because it is desirable to turn to this account, at anytime to see by direct reference the particulars of bonuses ; but it is by the n-ixt entry (see Journal 149) written off to the City of Ontario account, and not allowed to stand in the form of an asset, which, of course, being a gift, it is not. It is scarcely necessary to say that at the maturity of any debenture issue, for which a Sinking Fund has been provided, in the manner recommended on page 144, the amount at the credit of Debenture account, representing the issue would be I written off by a debit, the corresponding credit of which would close its Sinking | Fund account. As the proportion of Separate School Taxes does not come into the Treasurer's I hands, we credit the Tax account of any year with its amount, the total of the I Assessment Roll having been charged. (See Journal 148.) We have given two accounts with salaried officers of the corporation, and charged I the amounts supposed to be paid to the other officials direct to Salary account. You will see by referring to these individual accounts that at the end of the year they are closed by Salary Account. Of course in actual work more of the officials would have | individual accounts. Rents we have put through Rents account, but it is desirable when there are | many tenants to have individual accounts with them. The Sinking Fund levy, which we recommended to be made yearly, except! under peculiar circumstances, we have omitted, with the understanding that this year I is a very hard one, and that next year a double levy will be made. For the samel reason we do not pay off the note under discount which matured on rst July, but I continue to use the loan, paying therefor a rate of interest as agreed upon with the| bank. Revenue account is similar to Loss and Gain account, and is used, as you will seel on page 150, to close the accounts for the year that are neither assets nor liabilities,! but representative or working accounts. It does not show all the revenue andl expenditures, for of course when an amount is received for property sold, as fal instance the sale of lots, it is passed to the credit of Real Estate account, and likewisel when a sum has been paid on the reduction of a liability which is already in youil 163 jctor here ; him with 1 crediting than one in making mdition of jks, laxity, e acquaint- mds at the e from the J for three ement with d treat the ;s reach his lus account ne to see by see Journal in the form and charged count. You year they are would have len there are early, except j that this year tor the samel St July, but pon with the! s you will seel nor liabilities.! revenue andl sold, as foil , and likewisel Iready in yoml Ledger, that account is debited with it ; for example, see County of Windsor account. To ascertain, therefore, the receipts and expenditures for the year you will go through the several Ledger accounts which show them. Should there be any outstanding debts at the end of a year, which you have been unable to pay, you will credit the parties to whom they are owing, and debit the accounts to which they should be charged. This should be done before closing the accounts that are transferred to Revenue account. In actual work the amount of interest accrued on the note overdue since the I St of July would be debited to interest account and credited to the bank. The aim is to make the transactions of each year complete within the books before they are closed. At the opening of the set, the City of Ontario account showed that the city's liabilities exceeded its assets by over $10,000 ; but at the close this is reversed, and the assets exceed the liabilities by over $8,000, If you study the matter you will see that this has been brought about by the reduction, by $25,000, of the linbility of the County of Windsor, an addition to the bank deposit of over $8,400, a few other minor reductions of liabilities, and per contra the payment of a $io,coo bonus, and a few minor reductions in the assets. We may remark that the assets shown on the books of a municipal corporation are, to a large extent, nominal. Its ability to pay its liabilities is not reckoned by what the corporation of the city niay own, but by the value of the city's whole assessable property. You will understand this after a few moments' thought. For instance, the cost of a bridge is shown on the books to be $10,000. The bridge is nominally worthless, so far as its saleable value is concerned, but it is a thing of value to the corporation, and is, therefore, regarded as an asset, and its cost stands at the debit of an account from year to year. It might be desirable, however, to write off a certain percentage of this account yearly, as the bridge becomes worn and useless ; certainly in ordinary business this principle should be carried out, Loss and Gain being made debtor yearly to the account for the estimated depreciation. During the year you are supposed to have kept all the papers, warrants, checks and vouchers, in a neat and convenient form for reference ; the warrants, checks and vouchers being consecutively numbered, and on the appointment of the auditors you are prepared to submit your work for their examination, exhibiting with your Ledger the Trial ^.i.lance and Asset and Liability statement in the forms given on pages 160 and 161. Their duty, of course, will be to first check your work, and afterwards prepare in detail an abstract from your books, showing the year's receipts and expenditures, and also the items composing the several asset and liability accounts, I and to make any suggestion or recommendation that may seem desirable. FARM ACCOUNTS. Originally prepared by J. W. Johnson, at the suggestion of the Honorable the [Provincial Treasurer of Ontario, for the Royal Commission appointed to take evidence on agricultural matters in the year 1880, and recommended by the I Commissioners. TO TEACHERS. The keeping of accounts by Farmers is strongly recommended, and in this [connection we would say to Teachers in rural sections desiring to add something of practical value to their curriculum, that they can teach any boy of ordinary ability to |keep books on the farm after this method. Commence with, say, the first seven Sets in this book, then let them write up the iDay Book transactions only of the Farm Set, and work out the Journal, Ledger and Istatements for themselves. Ifr- 'J '■wt, i» 164 ; ♦ : FARM ACCOUNTS. Township of Thurlow, April, \%ya, DAY BOOK. JOURNAL. John Roblin this day i commences to keep a set I 1 of books by double entry 1 1 for the purpose of rceord- inpr the business of his farm, and to determine yearly his gains and losses, and assets and liabiliiies. 1 INVENTORY OF PRO- i PERTY. 1 1 Real Estate, 50 acres, as 1 1 under : 1 [ Field No. i, 8 acres. i 1 Field No. 2, 8 " Field No 3. 8 " , Field No. 4, 4 " 1 Field No. 5, 4 " 1 Field No. 6, 8 «• Field No. 7, 6 " Orchard, Garden and Buildings,4 " 50 acres valued, including build- ings, at $75 per acre $3750 00 I I Real Estate Dr. . Furniture " . $3750 520 00 00 : Household Furniture. . . 520 00 I I Plant " . Live Stock " 890 215 00 00 Plant as under 890 00 2 < 'ash 525 00 2 Teams $400.00 2 Farm Produce " . 320 00 I Reaper ... 100.00 3 Field No. 6 " . . 10 00 I Mower 75.00 I To Capital, $6230 00 2PloughR.at$i5 30.00 I Harrow.. . 15.00 2 Sets Harness, at $25 50.00 2 Whiffletrees, at $2.50.... 5.00 I Waggon .... 75.00 I BugKV 100 00 I Cultivator.. 1000 I Horse Rake 24.00 Sundry Imple- • ments 6.00 1 89000 Live Stock as under : 215 00 1 5 Cows.. ... 15000 1 10 Sheep 50.00 ' 3 Hogs 15.00 Cash 525 00 t Farm Produce, oats, hay &c.,&c., on hand, 320 00 ' Field No. 6, 10 00 1 For value of timothy and clover seed in ground. 6230 00 Carried forward. 00 $6230 00 $6230 3rd. Paid Cash for Fields Nos, 1 bush. Barle Field No. 3, Wheat at % Field No 4, Oats at 50c Field No. 5, Corn and ] nth. Credit John Tl Credit Wm. \ For 9 days' la on Fields N l6th. Credit Ino. Tl Credit Wm. V For 4i days' la on Field Nc 19th. Credit Jno. Tl; Credit Wm. \A For 2\ days' Field No. 4. 23rd. Credit Jno. Th Credit Wm. \\ For 4j days' Field No. 5. 28th. Paid Cash for Seed, Ohio corn for gi Vetches, Mil 165 DAY BOOK. Tcnvnship of Thurlmv^ April, 1890. JOURNAL. 3rd. Paid Cash for Seed : Fields Nos, i & 2, 32 bush Barley at 75c. Field No. 3, 16 bush. | Wheat at $1, | Field No 4. 8 bush j I Oats at soc , Field No. 5, Indian Corn and Potatoes. nth. Credit John Thompson Credit Wm. Wilson, For 9 Hays' labor each on Fields Nos. I & 2. l6th. Credit I no. Thompson Credit Wm. Wilson, For 4i days' labor each on Field No. 3. 19th. Credit Jno. Thompson! Credit Wm. Wilson, | For 2i days' each on! Field No. 4. 23rd. Credit Jno. Thompson Credit Wm. Wilson, For 4i days' each on Field No. 5. 28th. Paid Cash for Garden Seed, Ohiocorn for green feed Vetches, Millet.&c, << Paid Cash for labor op Orchard & Garden, 30lh. Paid John Thompson on account. Paid Wm. Wilson on account. The Milk from our 5 Cows is taken by the 'Allen Cheese Fac'y' at the rate of 8c. for a gallon of 10 lbs. May 5th. Received from "Allan Cheese Factory " for milk in April, Cash. 29th. Paid John Thompson account in full. Paid Wm. Wilson ac- count in full. $-'4 16 10 10 00 00 00 00 00 00 SO 50 25 25 50 50 10 10 oc 00 25 25 20 00 CO 00 «5 20 00 00 GO 00 70 50 3rd. Forward, Fields Nos. I & 2 Dr, Field No. 3 " " " 4 «• To Cash, nth. Fields Nos. 1*2 Dr To John Thompson, " Wm. Wilson, i6th. Field No. 3 Dr To John Thompson, •' Wm. Wilson, iqth. Field No. 4 Dr. To John Thompson, " Wm. Wilson, 23rd. Field No. 5 Dr To John Thompson, " Wm. Wilson, 28th. Garden h Orchard Dr. To Cash, Garden & Orchard Dr. To Cash, 30th. lohn Thompson Dr. Wm. Wilson, " To Cash, J230 24 16 May 5th. Cash Dr. To Cows, 29th, John Thompson Dr, Wm. Wilson To Cash, Carried forward. 18 10 i| 10 00 00 00 CO 00 $6230 00 15 10 10 00 00 50 00 00 00 00 00 $6390 70 25 25 70 49 00 20 00 00 50 50 25 25 50 50 00 00 00 >5 20 $6390 50 70 I IM; 11 1» : J 166 DAY BOOK. Township of 7 hurlmv, y»»e, 1890 JOURNAL. June 1st. t Amts. forward, June 1st. ^6390 70 86390 70 I'aid cash for Groceries « 7 50 : 5 House Expenses Dr. ^4 SO •♦ '* "Dry Goods 17 00 !J 24 50 2 To Cash, 24 50 3oih. 301 h. Have clipped and sold 5 Cash Dr. 43 00 for Cash, 2 To Sheep, 43 00 60 lbs. Wool at 30c., 18 00 Sold for Cash 10 lambs <• at $2,50. 25 00 43 00 • c 2 Farm Produce Dr. 200 00 Have harvested from 3 To Field No. 6, 200 00 Field No. 6, 20 tons Hay assumed to be tt worth $10 per ton, 200 00 Paid for harvesting 7 00 3 Field No. 6 Dr 7 00 Hay, 2 To Cash 7 00 July 31st. July 31st. Have harvested and 2 Farm Produce Dr. 420 00 threshed from Fields \3 To Fields Nos. i & 2 420 CD Nos. I and 2, 560 bush. Barley (average 35 to acre) for which I have been offered, and haveaccepted for October delivery, 7SC. per bush. 420 00 August 5th. August 5th. Have harvested thresh- • ed and sold 240 bush. Wheat for Cash from Field No.3,at$i.2o. 288 00 Put into Barn for use 2 Cash Dr. 288 00 from same Field, 20 2 Farm Produce 24 00 bush.Wheat,at$l.20 24 00 312 00 3 To Field No. 3, 312 00 Credit Jno. Thompson h, Cash To Cows, Dr Dr. Sept. 15th. Farm Produce Dr. To Field No. 5, fohn Thompson, Dr. Wni. Wilson To Cash, it Field No 5 Dr. To Cash, House Expenses, Dr. To Cash, 30th. Cash Dr. To Garden and Or- chard, Garden & Orchard Dr To Cash, Oct. 29lh. Cash Dr. To Farm Produce, Nov. 30th. Cash Dr. To Cows, House Expenses Dr. To Cash, Dec. 15th. Cash Dr. To Farm Produce, 1891. Jan. 20th. Cash Dr. To Farm Produce, " Field No. 5, Carried forward, 62 80 80 80 144 «9 47 58s 50 420 47 15 «9 *7S34 00 50 50 CO 50 00 00 00 10 20 20 10 $8978 00 40 62 80 80 80 144 14 »9 47 00 00 00 50 585 50 420 47 00 00 00 10 15 20 19 20 00 00 98978 40 168 . ♦ . S DAY BOOK. Township of Thiirloiv, Jiinnary, 1891, JOURNAL. 20th. Paid subscription to Church for one year. March 31st. Paid Conger Brothers their account for Groceries to date, Paid subscription t< " VVeelcription ti " Farmer's Advo- cate," Paid Taxes for 1890. '• F. B, Graham f.>r I suit Clothes for sell and 2 for the boys, Paid Geo. Wallbridirf for Groceries in full to date, Paid John McKeown fur Bouts and Shoes. Credit Farm Produo account with Horse Keep, Oats, Hay, etc., used. «• Credit Cows with Milk used in House, i( Charge Cows as under. For Pasture— Field No 7, For Garden Feed — Garden and Orchard For Hay, Straw, &c., — Farm Produce, Charge Sheep as under For Pasture — Field No. 7, For Hay, &c., — Farm Produce, Give Farm Produce account Credit for Stuff used for House, Write off from the value of Plant 10 per cent, for wear & tear $14 2 27 00 53 00 42 50 IS 60 25 10 60 5 10 90 00 tX) 00 00 CO CO 00 $20 iS 138 210 95 »S 65 89 00 90 10 00 00 00 00 00 00 20th Forward, House Expenses Dr. To Cash, March 31st. House Expenses Or. To Cash, 3 "St. House Expenses Dr, To Cash, Horse Keep Dr To Farm Produce, House Expenses Dr. To Cows, Cows Dr. To Field No. 7, " Garden&Orchard " Farm Produce, Sheep I>. To Field No. 7, " Farm Produce, House Expenses Dr. To Farm Produce Loss and Gain To Plant, Dr. «8978 20 18 138 210 30 95 65 89 40 00 90 10 00 00 $9659 00 00 00 00 40 1*8978 140 20 ,00 90 13S iio 210 00 2; ool 10 ool 60 ool Dr. 1891 1 Apt. I To 1890 I Apr To( Apl. I ToC lApl, I To Ca I To CaJ llay lune n 5 ool 10 ool S 30 S 30 'Pt| 30 29 30 •S 65 ool 20 I |To Cat "Gov " Shed *• Fiell " Cowl '* Garci " Farr •• Cowl " Farr •• Sunc 89659 Dr. 1891 Apl. 1890 Apl To Balance, To Capital, 169 CAPITAL. Cr. 7185 7«8s 50 so 1890 Apl. FURNITURE. REAL ESTATE. By Sundries, " Loss ami Cain 6230 9SS 7185 00 50 50 I 3750 00 IS9, Apl. I By Balance, 3750 00 ^ ^1 Apl. 00 00 00 00 00 10 ool 6500I 40 11$9659 I890 Jpl, llay lune To Capital, To Capital, I 5 30 S 30 30 29 30 >S 20 520 00 Apl, By Balance, LIVE STOCK. I 215 00 I89I Apl. I By Balance, CASH. To Capital, •' Cows, '• Sheep, •• Field No. 3. " Cows '* Garden & Orchard " Farm Produce, •• Cows, " Farm Produce, " Sundries, 1890 1 525 00 Apl. 3 2 'S 70 I( 28 3 43 00 S 20 18 '38 i5'>3 00 2015 80 GO GO CO 00 50 50 00 60 80 00 00 50 CO 20 00 90 10 70 ' llMi lln' •b.- J9A h M Dr. 170 FARM PRODUCE. ♦ . Cr, 1890 Apl (une July Aug Sept I 30 31 S >s >5 1 1890 To Capital, •' Field No. 6. 1 ! 320 00 Oct. 29 3 200 CX3 Dec IS '• Fields Nos. 1 ^; 2, 420 00 1891 " Field No. 3, 24 00 |an. 20 " Field No. 4. 80 00 Mai 31 '• Field No. 5, 1 >44 1 00 3« 31 3« 00 Apl. I 118S By Cash, '* Cash, " Cash, " Horse Keep, •' Cows, " Sheep, " House Expenses Halance, 4 420 0.) 4 19 20 4 5 5 5 5 6 S 00 210 cu 60 CO lu 00 65 CO 395 I li-J 1188 Dr. 1890I Apr 3 " 19 Aug 30 1891 I Apr I " To I uo 1890 Apl. I June 30 1891 Apl. I To Capital, " Cash, '* Loss and Gain, FIELD No. 6. ( Grass. ) I 3 10 7 00 00 1890 June 30 6 i «83 200 00 00 By Farm Produce, 200 00 200 00 Apr. It t!)9i 3 ToC 2i " S 'S " c Apl. 3 *t II Aug 5 t< «S 1891 Apl. I FIELDS Nos. 1 & 2. {Barky.) To Cash, " Sundries, •' Sundries, " Cash, *' Loss and Gain, 2 24 GO jjuly 30 2 18 00 1 3 7 00 3 28 00 6 343 00 1 1 420 00 By Farm Produce, 420 00 420 1 1890) Apr 30 |To Ca ■ May 29 fiepi '5 To CaJ Apl. 3 •< 16 Aug 5 >( 1.5 1891 Apl. 1 FIELD No. 3. {Wheat.) To Cash, " Sundries, *' Sundries, " Cash, " Loss and Gain, 2 16 00 Aug 5 2 9 00 3 7 00 3 >.S 60 6 264 40 312 00 By Sundries, 312 30 29 To CasI m IS To CasB 312 Cr. 42U 0) 10 20 K ou 210 (U (m CO lo 00 65 395 1 CO 1188 i uo 200 00 200 00 420 I 00 Dr. 171 FIELD No. 4. (Oa/s.) Cr. To Cash, " .Sundries, •• Cash, " Loss ami Cain, iS'^o Apr 3 ** 19 Auk 30 1891 Apr I 3 9 4 00 Aug «5 3 4 4 9 50 80 6 ' 61 70 80 00 By Farm Produce, 98o 880 GO 00 FIELD No. 5. {Corn and Potatoes.) Apr. 3 (i 23 Sept •5 1891 Apr. I To Cash, " Sundries, " Cash, " /.os» ami Gain, 2 5 00 1 Sept 15 2 9 00 1891 4 19 00 |an. 20 6 >I3 00 00 146 By Farm Produce, Cash, 4 144 4 2 146 00 00 00 JOHN THOMPSON (Hired Man.) 420 I col 1890 1890 j Apr 30 To Cash, 2 10 00 Apr. II By Fields 1 and 2, 2 1 9 CO May 29 il t 4 2 10 2,S li 16 •• Field No. 3, 2 I 4 SO i( 19 " Field No. 4, 2 1 2 2S II 23 " Field No. 5, 2 ' 4 50 To Cash, 20 25 By Fields i and 2, 20 25 Sept «S 4 7 SO Aug S .3 4 CO 50 II i II " Field No. 3, 3 3 so 1 1 7 7 SO 3 3'2 !"l 3I2JJ WM WILSON {Hired Man.) ipr lay ept 30 29 >5 To Cash, II II To Cash, 2 2 10 10 00 2S 25 Apr. II II II II 16 19 23 By Fields i and 2, " Field No. 3, " Field No. 4, " Field No. 5, By Fields i and 2, " Field No. 3, 2 2 2 2 9 4 2 4 00 SO 25 SO 20 1 20 25 4 6 SO so Aug II S S \ 3 3 00 50 6 6 SO •In 172 . », Dr. Mar Apr. Mar Apr. GARDEN AND ORCHARD O. 1890 Apr. 2.". T. J *»b, *i !• • k «< Sept 30 .1 Apr. 1 - ^jj i 1 1890 8 6 00 Sepi 30 » 9 00 IMar 3> 4 SO 00 1 6 530 00 1 ! 1 595 CO By Ca«h, " Cowi, 58s 00 10 0() .595 00 COWS. 3 ITo Sundries. I I " Loss and dun, 1 95 00 May 5 By Caih, a «5 70 60 60 AUR 30 »> II 4 63 «o Nov 30 II II 4 47 10 1891 155 60 Mar 3« '• House Expenses, 5 30 00 "SS 60 HOUSE EXPENSES. June I .Sept >5 Nov 30 1891 Ian. 20 Mar 31 Los Cr 58s 00 10 (XJ 595 00 i\$ \ 60 359 JO Dr. 1891 Mar 1 h 1 47 '1 30 .1 IS9I Apl. To Plant, ' House Kxpenseii, ' llorhe Keep, ' Capita/, 173 LOSS AND GAIN. Cr. HALANCE. To Real Estate, " Furniture, " Plant, " Live Stoci<, " Cash, " Farm Produce, 1891 5 89 00 Apl. 5 359 20 5 210 00 1 1 1 955 50 i 1 1 1 1613 70 1 1 Hy I " Fields 1 and 3, ,1 343 00 Field No. 3. 3 1 264 40 Field Nu. 4, 3 i 61 70 Field No. s. 3 1 ««3 00 Field No. 6. \ • 81 00 Field No. 7, 6 ! 30 00 Gard. i\: Orchnr'3 183 30 530 60 28 00 40 70 00 00 00 60 00 If the audited by saved. Ma books of a c methods, or entries for r perplexity ai people intei institutions 1 it will be to entry methot We will say a church, I finds iht ace I at all. He c I the double ei F^ shot] upon to bring [-ascertain t' statement of whether the ii II16 '13 70 ASSET AND LIABILITY STATEMENT. Adn7 is/, 1891 Folio I Real Estate, Assets. Liabilities. 50 acres, including Buildings, .... .... 1 $3750 00 I Furniture, Contained in hjuse, .... .... .... j 520 00 I Plant, as per list of a year ago, less 10 per cent, written off for wear and tear, ... .... .... 801 00 I Live .Stock, as per list of a year ago, 215 00 2 Cash, in B.ink $1490, in hand $13.70, 1503 70 2 Farm Produce, Various crops unsold and unused now in Barn 395 80 I /o^n Robliti's Capital one year aco 6230.00 Gain as per statement, .... .... 955. 50 Worth 1 St April, 1 89 1 7185 , 30 $7185 5° I718S So| I in which to k« j General Ledg hhe same as t Pew rents wot Jfollowing whi Individual woi Jihe General L lofeach pew |TOuld receive In the Ca [debit side for |he Gericral L pew holders' a ipecial columr p special col ™5ost frequentl 178 Gains. *343 264 61 H3 I : 183 i 30 530 60 28 00 40 70 00 00 00 60 00 t) I«i6i3 70 Liabilities. I BOOK-KEEPING FOR CHURCHES OR OTHER PUBLIC INSTITUTIONS. If the accounts of public institutions were kept by an efificient method and audited by competent men, a vast amount of trouble and scindal would often be saved. Many a good man has undertaken to be honorary treasurer and to keep the books of a church without any knowledge whatever of even the simplest book-keeping methods, or without knowing on what side of the Cash account he should place the entries for receipts of money ; the result being a " muddle " of the church's affairs, perplexity and trouble for the man, and a cry of dishonesty on the part of the other people interested. We shall suggest a system by which the accounts of such institutions may be kept, that will require on the part of the individual whose business it will be to keep the books, a knowledge of only the first principles of the double entry method. We will suppose that an individual is appointed treasurer for a public institution, say a church, as being an institution universal in this country. He takes office, and finds the accounts in an unsatisfactory state, kept by a bad method, or by no method at all. He concludes that it is best to open a new set of accounts and keep them on the double entry system. F^ should do first what the skilled accountant will always do where he is called upon to bring order out of confusion, or change single entry books to double entry 1 - ascertain the resources and liabilities wherever they can be found, make out a i statement of tii^m, and by subtracting the one from the other he will determine I whether the institution possesses capital or is insolvent. BOOKS TO BE USED. The books will be the Cash Book, Journal, Pew Rent Receipt Book with stubs, land Ledger, and if there be a large number of pew holders it will probably be [desirable to keep a SUBSIDIARY LEDGER, I in which to keep the individual pew holder's accounts, and keep one account in the General Ledger called " Pew Holders," the debit balance of which would always be (the same as the debit balances of the individual accounts in the Subsidiary Ledger. Pew rents would be journalized say every six months as follows : — )0 x> 70 80 50 Pew Holders, To Pew Rents, 7185 «7i8s 1 9\ Ifollowing which the names, numbers of pews, and amount of rent due by each [individual would be given ; the sum total being posted to the debit of the account in Ithe General Ledger called " Pew Holders," and the respective amounts to the debit lofeach pew holder's account in the Subsidiary Ledger, and " Pew Rent " account Iwould receive credit. In the Cash Book special columns should be ruled on each side, that on the debit side for " Pew Holders." When posting, credit " Pew Holders " account in khe General Ledger with the monthly total, and post to the credit of the respective pew holders' accounts in the Subsidiary Ledger the amounts paid by them. Another [pecial column on the debit side might be kept for collections. On the credit side [he special column.s would be devoted to those accounts for which disbursements are nost frequently made. "* 10 176 SHORT ILLUSTRATION OF THE METHOD, JOURNAL. To open the books, journalize the resources and liabilities from the statement, The account to represent capital or insolvency, (similar to stock in a merchant's ledger) will be Church account. m t Folio Pew Folio — ■ Holders rjeneral Resources. Ledger Ledger. I .Sundries to Church .iccount, $19708 S" I Real Estate, $15000 00 I Organ, 3000 00 I Cash, .... 120 00 2 Furniture, . . . . . - 1500 00 2* Pew Holders, due at this date as below, John Robinson, Pew No. g, 6 mos., S. Johnson, " 28, i yr., J. T. Reaves, " 115, 6 mos., R. H. G.-irralt, " 89, i yr., N. ^'eolnans, " 58, 6 mos., $ 6.00 IJ.OO 8.00 10.00 7.00 88 50 1 1 z R. Fli..t, " 7g, I yr.. 15.00 z S. Donnelly, '' 61, 6 mos.. ? 50 2 J. H. Ritchie, " 71, 18 mos. , 20. Ou $88 so Liabilities. I 2 2 ;t 3 3 C!liurcli account to Sundries, Mortg.-ige P.-iyable, J. Neil & Co., t;eo. W.-illace, Jas. Lobb, Rev. H. Lord, None -.—When the above rexource and liability entries have been posted to the Ledger, the difference belireen th". two sides of the Church Account will show the capital, and to the debit of their respective accounts yon will have placed the .esources, and to the cre^'it of their respoctive accounts the liabilities. There will be very few entries required in the Journal, as cash is almost the only element in the transactions. The crediting of salar- ies and the debiting of pew rents every six months will be about the only ones, except at the end of the financial year. We will there- fore, to illustrate, suppose that six months have elapsed since the opening Journal entries were made. 3447 10 3000 159 58 78 150 5" 70 00 Folio Pew Holders Ledger. Folio (ieneral Ledger. Pew Holders Dr. To Pew Rents, For 6 mos. rent as below : John Robinson, pew No. 0, $6.00 S. Johnson, " 28, 7.50 J. T. Reaves, " 115, 8.00 R. H. Garratt, " 89, 5.00 N. Yeomans, " 58, 7.00 R. Flint, " 79, 7.50 Donnelly, " 61, 7.50 J. H. Ritchie, " 71, 6.50 Jno. Gillis, " g, 7.50 W. Puntin, " 15, 8.00 $70. 50 NoTK.— Pott to debit of Peio Holders' account in Gene- ral Ledger the sum, total, and to the debit of the individual pew holders in subsidiary Ledger their respective amounts, and to the credit of Petv Rents' Account the sum toial. Salaries acct. Dr. to Sundries, For 6 mos. salarj-. Rev. H. Lord Miss liowman, .... .... .... .... John Harris, .... .... .... NoTK. — Make Salary Account debtor for the total of the salaries for the G mos., and give each individual credit for hif rtnrf her oivn amount. At this point also m.ake entries for any debts coutracted since the last closing of the books that have not already been placed to the credit of the parties. 70 S7S 5° 70 400 75 100 I i.u- e ft. 2a-, d t r2 C .. S :r;s J:fi%^ '5^ =■11? :: s c'5i M »M a.p-r- i.S" , » ^ , ^ ^ ^ ^ ^ , ^ J 1 S"H " •* »« •* • - " * •> »* H 00 1 * •• n g n" n C/3 •—1 g- a n n' H ?3 50 5* 5« a n re* n n re" "—I n re* n c* E. p" a n n Ou : 1 s 3 c 3 '/I ft (A s VI > a 2. <' re 2 1^ 9 p a V) a re. a 'A 3 a '/I E a cu p (/} 5' "ftT a 3" rr §2.H. 1 1 a' w ft n Si & tn n t 1 a a. ft) 5* •— ( c a B a ft> a' ■> n Si It n a a' C/2 c a 0. ft) 3' > 5' 3' : 3' C/3 c 3 5' c p -3 re 3" 'A p a 1 r* §. 0" ' e cr ^ 1? r3 2, ;/) ~~4»' Ov Xj\ ^ uj ti - , n 1 rm ^« b M ^ vj 00 ^ Ui o\ (^ rt -^ vO Pi* •«j ^ o^ 00 0^ 8 I 8 8 8 °.T3 2 « CA) a* 00 ■ _ ■Date - u> ■1^ -p> Ui -p. f^ ■pk u» *» ?*3 ;5^r ,3ii ?3 2 W t^ "^ W >!: '^ 3 ji ffi S 5? CfQ orq W 2, T3 n- s O M ., „ X re a •a Q o re 2. 'a a n o p p 3 S o C/3 rt 3 3* P 3 C a 1' 3 p rr "a ■ ■ a. 3 - ' 3 P 8 re n 2. ■5' P <• •• U) re 2 •5 p :; n 0^ 1 2 c P4 1 i t^y. s l-iul- •s ""^ ~~^~ — — _ --'— : r ^ N OS U> N OJ ^ m 01 >A NM M B 0. MM -k M CO no OJ V/i ^ ■^ Ln ** M V^ oc M Ul OS 1 "-o' U1 S 8 8 8 8 8 n 7) n C/3 inrr , ■atv^j >♦ ;♦ Dr. 178 GENERAL LEDGER. CHURCH ACCOUNT. {Capital) Date To Sundries, " Balance, J. F. 3447 16572 20019 Date 10 i 25 i 35 i' My Sundries, " Woritingacct. J. F. 19708 310 I2001Q Cr. 50 35 REAL ESTATE. By Balance, 16572 25 To Church acct. 15000 00 ORGAN. To Church acct.. 3000 CASH. jTo Church acct., I " Sundries, I 120 I '242 00 30 1362 ; 30 ; I I By Sundries, " Balance, 948 95 413 • 3) 1362 30 To Balance 413 35 FURNITURE. To Church acct. . 1500 PEW HOLDERS. To Church acct. " Pew Rents. * To Balance, 1 i ] i 88 70 50 5° i ! 1 \ 159 CO I By Cash, i " Balance, ! 118 00 1 1 ^ 41 CO i i 159 , * 41 00 MORIGAGE PAYABLE. I By Church acct., 3000 00 J. NEILL & CO. By Church acci., «S9 50 To * This balance is the total indebtedness of Pew Holders at the yearly closing of the hooks, and agrees with ihc toii.| debit balances in the Subsidiary' Ledger. Cr. j7o8 310 50 85 0019 16572 35^ 25 948 95 413 ' 3) 1362 30 Dr. Dale To Sundries, To Cash, " Balance, 179 SALARIES. Cr. J. F. 575 00 Date By Working acct., J. F. 575 00 To Working acct.. GEO. WALLACE. ;By Church aoct., 58 70 JAS. LOBB. By Church acct. , 78 90 REV. H. LORD. 1 150 1 00 350 00 50 00 550 00 1 COLLECTIONS By Church acct., ' Salaries, By Balance, 150 400 00 00 550 I 00 1 124 30 iBv Cash, 50 I CO 1124 30 im- J In, •ifc... i# 118 00 41 CO 159 _cv.- 3000 00 159 50 zrees witli ihc toul To Cask, EXPENSE. >2 75 By Working acct.. PEW RENTS. '! I LIGHTINC;. By Working acct.. »2 I 75 1 ! To WorkiiJC acct.. 70 50 1 By Pew Holders, 70 50 FUEL. To Cash, 40 00 ; 1 j By Working acct.. 40 00 76 20 180 i t Dr. Date Dr. Date MISS BOWMAN, {Organist.) Cr. To Cash, " Balance, J. F. SO 25 oo oo Date 75 By Salaries acct., J. K. 75 75 00 00 By Balancr, JOHN HARRIS, {Sexton.) 25 00 To Cash, i( II " Balance, lO OO 8o oo lO OO ICO oo By Salaries acct. loo 00 lOO I CO By Balance, lO CO INTEREST, To Cash, i8o OO By Working acct. i8o 00 WORKING ACCOUNT. To Salaries, " Expense, " Fuel, •' Lighting, •' Interest, " •Church acct. 1 575 1 00 i 1 1 1 ' 1 1 12 75 i 40 00 76 20 180 00 3«o 85 1 194 80 By Collections, " Pew Rent.-, 1124 70 1 194 30 SO 80 SUBSIDIARY LEDGER. For Pew Holders' personal accounts. JOHN ROBINSON {Few No. 9.) O To six mos' Rent, J. I'-. 6 6 i 00 00 I Date 1 12 00 1 By Cash, 12 12 CO CO S. JOHNSON, {Pew No. 28.) To I yr's Rent, " 6 mos,' Rent, •5 00 7 50 1 22 SO By Cash, J. T. REAVES, {Pew No. 115.) 21 5c 22 fO . To 6 mos.' Rent. " 6 " 8 oo i 8 00 16 ■^"1 By Cash, 16 00 16 i 00 To Tc * This balance, which goes to Credit of Church account, is the difference between the income and expenditure of tht I year, or, if we may sd speak in connection with a church, the year's gain. The working account is the same as Loss and | Gain account in a business. 181 75 0" Ts 00 ICO 00 lOO I CO ~IO CO i8o 00 1124 3° 70 ': 50 1194 I ^ Cf 12 CO 12 I C0_ " I 22 1 5C t 22 I JO Dr. R. H. GARRATT (Arf; No. 89.) Kate 16 00 To I year's Kent, "6 mo?.' " To Palancf, J. F.I iDate! 10 00 1 1 1 5 00 1 : ! ; 1 IS GO Hy Balance, IS I 00 N. YEOMANS, {Pejv No. 58.) I To 6 mos.' Kent. I4tt it «t 7 00 1 7 00 >4 00 By Cash, R. FLINT, {Pav No. 79.) To I year's Rent, " 6 mos.' " To Balance, '5 00 7 50 ! i 1 22 SO By Cash, " Balance, 10 I 50 S. DONNELLY, {Pew No. Gv.) To 6 mos.' Rent, 1 7 50 7 50 I"? 00 ■ By Cash, J. H. RITCHIE {Pew No. 17.) To 18 mos.' Rent, i 1 20 00 6 SO 26 50 By Cash, J. McGILLIS, {Pew No. 9.) To 6 mos.' Rent, SO W. BUNTIN, {Pew No. 15. Lxpenditure of Af I r«^measLossan« To 6 mos.' Rent, 00 Cr. C.B.K 1 1 '5 •5 00 00 14 14 00 00 12 10 00 SO 22 50 •5 >5 00 00 26 26 so 50 iMk "^ 5r' 182 TRIAL BALANCE. .» . I. K. 2 3 4 4 4 I.. K. A CCC 1 Church, 1 Real Estate, 1 I Organ, Cash, 2 Furniture, 2 Pew Holders, 2 2 Mortgage Payable, J. NeiU & Co., 2 Salaries, ? Geo. Wallace, 1 las. Lobb, 3 Rev. H. Lord, .3 Collections, 3 3 Expense, Pew Rents, 4 Fuel, . . . 4 4 Lighting, Miss Bowman, 4 4 John Harris, Interest, 1 CCOUNTS. 1 Dr. Balances. Cr. Balances. •** fl,fl« ..«. •••• 1 626 1 40 15000 00 • • • • • t • 3000 00 413 35 1500 00 |i 41 ... ... ij 00 3000 •59 00 SO 1 575 00 1 i 58 70 7» 90 12 75 50 1124 00 30 . . . 70 50 . . . 40 00 . ) * • • • 76 20 .... 25 10 00 03 — { 180 i 00 \ 1 1 .^20838 30 $20838 30 WORKING ACCOUNT STATEMENT. {Similar to Loss and Gain Statement of a business.) Dr. L. F. Cr. To Salaries, 575 00 3 By Colled ions, 1124 ,10 " Expense, 12 75 3 " Pew Rents, 70 SO " Fuel, 40 00 " Lighting, 76 20 " Interest, 180 00 Balance, showing a gain as the result of the ^ year's operations, 310 «5 $1194 80 «ii94 So STATEMENT OF ASSETS AND LIABILITIES. L. F. Assets. L. V. Liabilities. I Real Estate, 15000 00 2 Mortgage Payable, 3000 00 I Organ, 3000 00 2 J. Neil! & Co., >S9 50 1 Cash, : 413 35 2 Geo. Wallace, 5« 70 2 Furniture, ! 1500 00 3 J as. Lobb, 78 90 2 Pew Holders, " 41 00 3 Rev. H. Lord. 50 00 1 4 Miss Bowman, 25 fO 4 John Harris, Net capital at date, being the worth when the books were opened, as shown in 10 16572 00 25 - i Church account, 16261.40 and the gain as !>hown in working 35 acct. and statement, 310.85 $16572.25 35 $19954 $19954 Th( record o The any good bailee th( given by warehousi merchanc actually ii such pers( Received '350 bu Em Warehouse I 183 ■*■ * Balances. >26i I 40 3000 i 00 >59 ! 50 58 i 70 78 90 ^o 00 1 124 30 70 : 50 25 , 00 10 oo $20838 1 30 H24 30 70 50 '$1194 1 ^° 3000 00 159 5" 5S 70 78 90 50 00 25 fO 10 00 16572 I 25 WAREHOUSING. The following Set of Warehouse Books illustrates the method of keeping a record of, and dealing with, Grain or Goods stored in a Public Warehouse. WAREHOUSE RECEIPT. The expression " warehouse receipt " means any receipt given by any person for any goods, wares or merchandise, in his actual, visible and continued possession, as bailee thereof, in good faith, and not as of his own property, and includes receipts given by any person who is the owner or keeper of a harbor, cove, pond, wharf, yard, warehouse, shed, storehouse or other place for the storage of goods, wares or merchandise, for goods, wares and merchandise delivered to him as bailee, and actually in the place, or in one or more of the places owned or kept by him, whether such person is engaged in other business or not. Stub. No. 127. Belleville, Sept, 29, 1894, Received from Silas Allan, 1350 bush. No. 2 Barley, Entered Warehouse Ledger, Folio I, " 2, The above is A FORM OF WAREHOUSE RECEIPT. No. 127. BdlcviUe, Sept. 29, 1894. Receivkd into store from Silas Allan, in good order and Icondition, thirteen hundred and fifty bushels No. 2 Barley, subject to his order. ^ R. W. CAMERON, %^ Warehouseman. form of receipt granted for grain, flour, or other commodity stored in a warehouse. It is called a Warehouse Receipt, and serves a very useful purpose in business transactions. It is made subject to the order of the individual, and is thereby negotiable by endorsement. The thing it represents may be sold and transferred without the buyer personally seeing the stuff. The bargain being concluded the holder simply endorses the Receipt and hands it to the purchaser, who now becomes the owner of what is stored, Loans are made by Banks upon Warehouse Receipts as collateral security, and in other ways it is a valuable and convenient business paper. Any one who wilfully makes a false statement in a Warehouse Receipt, or who, having control or possession of goods covered by any Warehouse Receipt, alienates them, or withholds them after demand by the legal owner, is liable to imprisonment for a term not exceeding two years. The blank forms should be printed and bound in books containing about 250 and should be consecutively numbered. Stub No. 250. Belleville, Oct. 18, 1894. Delivered 1350 bush. No. 2 Barley on Warehouse Receipt, No. 127. Stored originally by Silas Allan, Entered Warehouse Ledger, Folio I, •• 2. DELIVERY ORDER. No. 2Sa Belleville, Oct. 18, 1894. Warehouse Receipt No. 127, having been properly endorsed and delivered up, you are authorized to deliver to the bearer thirteen hundred and fifty bushels No. 2 Barley, stored originally by Silas Allan. R. W. CAMERON. «i9954iil per J. R. The above is a Delivery Order that should be written in the Warehouseman's office, and sent with the teamster to the Warehouse when delivery of the stuff is required, and when the Warehouse Receipt is given up, after being rroperly endorsed. The Blank forms should be printed and bound in books containing about 250 and should be consecutively numbered. IBfelU m N la 1# Ukl ■*,HI»* 184 WAREHOUSE LEDGER. The Ledger is kept with quantities only. It is to show the quantity of the various kinds of grain or other stuff stored and the owners of it. It is kept on the double entry principle, and is exceedingly simple and correct. // is posted from ilu s/ufis of the Warehouse Receipt and Delivery Order Books. EXAMPLES. Suppose you have received into store, for which you have granted Warehouse Receipts n shown in 6 different stubs, as on the form preceding : 1350 bush. No. 2 Barley from Silas Allan, R. McNaughton, Jas. Norris, A. M. Gunn, T. H Smallman, John Wa'ker, 2000 " No. I " 500 bbls. Flour 137s bush. Peas, 780 •' " 1875 " and have made the following deliveries for which orders were given, and which arc shown in 7 different stubs in your Order Delivery Book, as per the form precedim 1000 bush. No. 2 Barley, Silas Allan, 500 " Peas, John Walker, 500 bbls. Flour, Jas. Norris, 370 bush. Peas, John Walker, I so " No. 2 Barley, Silas Allan, 257 " Peas, A. M. Gunn, 1000 " No. I Barley, R. McNaughton, you would post to the respective accounts as follows : For stuff received, debit the account representing the stuff received, and credit the individual from whom received' For stuff delivered debit the individul from whom originally received and to whom Warehouse Receipt was granted, and credit the account representing the stuff delivered. You will keep this book posted each day, and thereby show at all timu the commodities and the respective quantities stored and the owners of them. A trial balance of balances taken from time to time will prove its correctness or otherwise. From this Ledger you will also be able to make out accounts for storage. No. 2 BARLEY. ■ ■ W.R. il D. 0. 1894 No. Bushels 1894 No. Bushels Sept 29 To Silas Allan, 127 1350 Oct. 18 29 By Silas Allan, 250 254 1000 150 No. I BARLEY. Sept To R. McNaughton, W.R. No. 128 Bushels j 2CXX) Nov 5 iBy R. McNanghton, D. O. No. 256 Bushels I 1000 • FLOUR. W.R U. U. No. Bbls. No. Bbls. Sept 30 To Jas Noriis, 129 500 Oct. 20 By Jas. Norris, 252 500 1894 Stfpt 30 Oct. 1 1 " 1 3 T Oct. iS 29 To To Oct. I 20 To F I iTo I' lOct. '9 I'o P« 29 I " The Deb I'ty of each in Jwners. A tr: Peing correctly (wners of it, rr y of the )t on the from the 185 PICAS. 1894 W.R. No. Rui^hels 1894 ID.O. 1 No. Bu'hels Sept 30 To A. M. Gunn, 130 1375 Oct. 19 My fnhn Walker, .•1 500 Oct, 1 " T. H. .Sinallmnn, "31 780 II 29 "John Wnlker, ' "j^ 370 " 3 " John Walker, 13a 1875 Nov 1 " A. M. Gunn, i^5. 257 arehouse SILAS ALLAN. UO. No. Bushels 1 Oct. iS To No. 2 Barley, 250 1000 Sepl " 29 «« l» 254 1 150 1 W.K No. Busheli 29 By No. 2 Barley, 127 1350 which are recedin: g rage. Nov Oct. d, debit the m received' nd to whom the stuff ■ ^'ov at all tinm hem. rrectness or To No. I Barley, 20 To Flour, R. McNAUGHTON. D.O. iSushels No. 1000 Sept 30 256 i\y No. 1 Barley, To Peas, JAS. NORRIS. 1 ( I) 0. 1 No. Bbls. 252 500 'Sepl 30 By Flour, A. M. GUNN. D.O, No. 255 I Bushels 257 Sept 30 liy Peas, T. H. SMALLMAN. Oct. : I By Peas, W.K. M No. Bushels 12b 2000 W.R. No. 129 Bbls. 500 I W.R. • No. I 130 Bushels •375 W.R. No. •3« Bushels 780 '9 29 To Peas, JOHN WALKER. 1). o.ji No. j I Bushels 251 I 500 253 >' 370 Oct. i 3 I5y Peas, W. R. No. '32 Bushels 1875 D.O. No. 256 I Bushels I 1000 Bbls. 500 t ruTo: I No. I 252 REMARKS ON THE LEDGER. The Debit Balance of the Barley, Flour and Peas accounts will show the quan- ity of each in store, and the Crcdif balance of the individual accounts will shew the wners. A trial balance should be taken from time to time to prove if the Ledger is eing correctly posted, and an abstract statement, showing what is in store and the wners of it, may be taken at any time, in a few minutes. IMAGE EVALUATION TEST TARGET (MT-3) ^./ fi o -^ 1.0 I.I iai2j "■ us. Hi 12.0 6" OOBnCBS Q^poratKHi ^ ^. -.*♦ V as WKT INAIN STIMT WniTK,N.V. 14fM ( 71* ) •71-4909 4f^ 186 JOINT STOCK COMPANIES. «i Joint Stock Company. — A Joint Stock Company is an association of individuals who have united and have become incorporated for the purpose of carrying out an undertaking; which would require a greater amount of capital than any single person would be able or willing to risk. Each member subscribes and pays for shares in the capital stock. The object may be to mine or manufacture, to trade, to print, to carry on a banking, loan or insurance business, or, in general, to do what an individual may do. The extent to which the resources of Canada have been developed is largely owing to the efforts of joint stock companies, acting under letters patent from the Crown, or under the authority of special Acts of Parliament, upon the limited liability principle. Limited Liability. — The term " limited liability " expresses the position of shareholders in joint stock companies, other than banks. It means that the responsi- bility of shareholders for the liabilities of a company does not extend beyond the amount of stock subscribed for. If that has been fully paid up, no further calls can be made ; but if it has not, then, in the event of its being required, shareholders must pay in full the sum of the shares taken. Individuals will contribute of their means, and become partners in a concern formed to develop a local or general industry, that will benefit the community, when doing so will involve no risk beyond a definite sum ; while they would refuse to join an ordinary partnership, with its attendant risks and unlimited liability, formed to effect the same purpose. While the law thus limits the liability of shareholders in joint stock companies, it requires, under a penalty of twenty dollars per day for neglect, that the public shall be informed that they are dealing with a partnership possessing exceptional privileges as to the liability of the members, and it is incumbent upon every company to afSx the word " Limited " after its name on its sign over its place of business, on its seal, on its advertisements, on its business papers, and, in short, whenever its name is used. Double Liability. — The term *' Double Liability " expresses the position of shareholders in banks. In order to afford security to billholders and depositors, the law makes the liability of stockholders double the amount of the subscribed capital. For instance, the owner of ten paid up shares of one hundred dollars each would be liable, in the event of the bank's failure, to be called upon to pay in one thousand dollars, as well as lose the money already invested. Unlimited Liability. — Unlimited liability in connection with joint stock companies is almost unknown in Canada, but is quite common in Great Britain. The failure, about ten years ago, of the City of Glasgow Bank was an illustration of the utter ruin that may come to the holders of shares in an unlimited liability com pany. Incorporation. — The incorporation of joint stock companies may, underj Dominion legislation, be effected in two ways, either by obtaining a special Act ol Parliament, or by letters patent under the General Joint Slock Companies' Aci| Banking, Insurance, and Railway Companies must be incorporated by special Act their requirements are such, and the powers which they seek are so extensive, thi special 1( ordinary general I chap. IK Und of the le Act," to I Pro; company forth the that of an amount ol which it i{ carried on Stoc] shares writ dence. T shall seven one half of cent. there( bank (unU estate,) app State of Cai than five. in the Cam posed nam number of < names of th letters pater and thereup their succes The fees c $200,000 $40,000 anc obtained su Increasi whole capiti law for inert Capital slock than two-thi lulled for CO Direct phich may plected anni I'heir own rij respect of ar_ share held b any such pn 18^ individuals ^ing out an ngle person or shares in to print, to n individual ed is largely ;nt from the ited liability ; position of the responsi- beyond the her calls can iholders must their means, industry, that definite sum ; iant risks and ;k companies, le public shall onal privileges npany to affix ss, on its seal, er its name is he position ol depositors, the| icribed caiiital. ;ach would be one thousand th joint stockj Great Britain. illustration oil d liability coni- es may, undfl! special Act ol oinpanies' Aci| r special Act extensive, thi special legislation determining their limit and scope is absolutely necessary. For all ordinary undertakings, incorporation under the general Act is amply sufficient. The general Dominion Act now in force is " The Companies' Act, 1886," to be found at chap. 119. Statutes of Canada, 49 Victoria, 1886. Under Ontario legislation incorporation may be effected, either by a special Act of the legislature or under •' The Ontario Joint Stock Companies' Letters Patent .\ct," to be found at chap. 157, page 1443, of the Revised Statutes of Ontario, 1887. Prospectus. — A number of individuals, having agreed to form a joint stock company under the Dominion Jomt Stock Companies' Act, issue a prospectus, setting forth the proposed name of the Company (which must not be the same or similar to that of any other incorporated or unincorporated company), the number of shares, the amount of each, and the capital, the names of the provisional directors, the bank at which it is proposed to keep their account, and generally stating the business to be carried on and the probable profits to be derived from it. Stock Book. — A stock book is prepared, in which each of the subscribers for shares writes the number he is willing to take, and affixes his signature, seal and resi- dence. Tliis is a binding and solemn contract to pay the calls upon the stock as they shall severally become due. Having obtained subscriptions to the amount of at least one half of the total amount of the stock of the company, and not less than ten per cent, thereof having been paid in and deposited to such credit in some chartered bank (unless the object of the company is one requiring that it should own real estate,) application may be made to the Governor-General through the Secretary of State of Canada, for the issue of letters patent, the applicants being in number not less than five. Prior to the application, at least one month's notice must have been given in the Canada Gazette of the intention to apply for the same, stating therein the pro- posed name of the company, its purposes, place of business, amount of capital, number of shares, the name, address and calling of each of the applicants, and the names of those who are to be the provisional directors. Notice of the granting of letters patent will be given forthwith by the Secretary of State in the Canada Gazette, and thereupon, from the date of the letters patent, the persons therein named, and their successors, shall be a body corporate and politic by the name mentioned therein. The fees charged are : when the capital is $500,000 or upwards, $200 ; between $200,000 and $500,000, $150; between $100,000 and $200,000, $100; between $40,000 and $ico,ooo, $50; less than $40,000, $30. A change of name maybe obtained subsequently, if it is not sought for an improper purpose. Increase of Stock. — The directors of a company may at any time, after the whole capital stock has been taken up, and fifty per cent, paid thereon, make a by- law for increasing the capital stock, and they may also in the same way decrease the [Capital stock ; but their action in this regard must be sanctioned by a vote of not less than two-thirds in value of all the shareholders of the company, at a >■•. ineral meeting jcalled for considering the same, and confirmed by supplementary letters patent. Directors. — The affairs of the company are managed by a board of directors, [which may consist of not less than three nor more than fifteen. They are usually elected annually at the annual general meeting, and they must be shareholders in their own right to the amount required by the company's by-law, and not in arrears in I'espect of any call upon stock. Each shareholder is entitled to give one vote for each share held by him ; such votes may be given in person or by proxy — the holder of any such proxy being himself a shareholder. II* 188 r Mil • t Officers. — The president and permanent officers of the company are elected by the directors ; but the auditors should be appointed at the annual meeting of the shareholders, for the reason that the officers of the company are largely controlled by the directors, and the audit being, as far as this connection goes, an examination of the faithfulness to the shareholders of both the officers and directors, it is necessary that the stockholders themselves should appoint the auditors. Secretary, — The secretary, who is frequently the responsible bookkeeper, also should be a skilled accountant. In our own experience we have been called upon to audit the books of companies that had at their inception appointed as secretary and accountant a " friend of the president," or a lawyer, or some " young gentleman " whose father was a large stockholder, and the books— or, to be more accurate, the memoranda — kept by such men have always been mixed and muddled. You can no more expect a man to perform the work of an accountant who has never thoroughly and patiently learned his business than you can look for reliable building plans from a man who has never studied architecture. It is hardly necessary to point out how much the success of the business of an individual, or firm, or a company, depends upon sound and accurate bookkeeping ; and yet the lessons taught by the failures confessedly brought about by the absence of it are often neglected. No man or number of men should attempt to conduct a business without the knowledge of book- keeping themselves, or the employment of those who are possessed of it ; and what is essential in this respect with individuals or firms, is indispensable in connection with joint stock companies, the affairs of which are usually of magnitude, and affect a wide circle. Calls on Stock. — For the first and each subsequent call upon stock an instal I ment list will be made out, and the payments will be acknowledged by issuing to each shareho'der instalment scrip. When the last call has been paid the instalment scrip will be called in, and in place of it stock certificates will be issued. Bookkeeping. — There are certain books that are required by law to be keptbv all companies, and which shall be kept open for the inspection of shareholders and I creditors of the company, and from which they make extracts. One of these is I called the Reference Book, which shall contain : — 1. A copy of the Letters Patent incorporating the Company and the by-laws I thereof. 2. The names, alphabetically arranged, of all the persons who are or have been| shareholders, with their address and calling. 3. The number of shares held by each shareholder. 4. The amount paid in and remaining unpaid, respectively, on the stock of each] shareholder. 5. The names, addresses and calling of all persons, who are or who have been! directors of the Company, with the several dates at which each became or ceased to| be such director. A book, called the .Register of Transfers, shall be provided, and in such booli| shall be entered the particulars of every transfer of shares. The penalty for neglecting to keep such books is the forfeiture of the Company's corporate rights. For the bookkeeping proper, all companies will at least have a Caslj Book, Journal, General Ledger and Stock Ledger ; such auxiliary books will be use(| »s the nature of the business may demand. Capital Sto< debit balam second figui I'edger will a Anothe |nients are pj same time, fhis is the [lability to tl hdividuals. 189 elected by ting of the introUed by nination of is necessary keeper, also lied upon to ecretary and gentleman" iccurate, the You can no ;r thoroughly ig plans from loint out how lany, depends y the failures No man or edge of book- it J and what in connection e, and affect a tock an instal- issuing to each I istalment scrip r to be kept by I areholdersandl me of these is| id the by-laws Ire or have beenl Stock Ledger. —The use of a stock ledger will be apparent, if you consider how troublesome and inconvenient it would be to keep an account in the general ledger with the numerous individual stockholder: of a company (who hold stock to-day and may part with it to-morrow), as is done with the individual partners of an ordinary partnership, whose interest is permanent. This book contains an account with each shareholder, in \.'iich are recorded his name and address, the number of shares of the capital stock of the Company held by each, and the instalments that have been paid upon them. A moment's reflection will make it apparent how easily transfers of stock are posted in this book, without affecting the general ledger. For instance, there stands at the credit of A lo paid up shares, which he sells to-day to B. They go to the office of the company, where A signs a transfer on the company's transfer book, and delivers up his certificate, which is cancelled. A new one is issued to B, and from the stub of the transfer book A is made debtor to B in the stock ledger. Such transfers may be made through the medium of stock brokers, acting for both buyer and seller. No restrictions can be placed upon the transfer of fully paid up stock, but the directors of a company must sanction the transfer of stock that is not fully paid up, in order to prevent holders from getting rid of the liability to pay, by transferring it to people who are not worth anything. Opfning. — In opening the books of a company, there are two ways of dealing with the stock subscribed for : you may debit the original subscribers for stock in the general ledger with the amount of their subscriptions, and place at the credit of the Capital Stock account the total of these, which is the nominal capital of the Company, until the stock has been fully paid up, when it becomes the real capital. It is a permanent credit on the ledger, only affected when the capital stock is either increased or diminished or watered. As calls upon stock are paid, credit the shareholders' accounts in the general ledger from the cash book, and at the same time credit their accounts in the stock ledger, which will be opened when the first call is paid. When stock has been fully paid up the shareholders' accounts in the general ledger will be closed, after which the stock ledger only will show their accounts. In the event of the general ledger being closed before stock is fully paid up, close the accounts of shareholders " By Balance," as you would any other personal accounts, showing a debt to the Company. In the balance sheet put the matter thus : Capital Stock subscribed (say) $50,000 " " unpaid, 60% 30,000 « stock of eaclij who have beenl ne or ceased to| id in such booi] the Company'! ;ast have a CaslJ iks will be used paid up $20,000 [Capital Stock account in the general ledger will agree with the first figures ; the total Idebit balances against the shareholders in the general ledger will agree with the [second figures, and the total of the amounts credited to shareholders in the stock [ledger will agree with the last. Another way of dealing with the Capital Stock is to credit the account as instal- lments are paid, crediting the payments to the shareholders in the stock ledger at the ame time, without opening accounts for the shareholders in the general ledger at all. This is the simpler way ; the argument for the first is that as the unpaid stock is a liability to the company, it should be shown in the general ledger at the debit of the ndividuals. 'fk ii! <•?! 190 t Prices or Shares. — Whether a company's shares are being sold at par, that is, the face value, at a premium or a discount, they are always at par in the company's books. The first issue of shares at the inception of a company will usually be at par. Subsequent issues may be offered at a premium, if the old stock is above par in the market. After the stock authorized by the charter has been taken by subscribers, a company's shares are no longer within its own control. It has none to sell, and their real value will be the investing public's estimation of them, based upon the efficiency of the company's management, the past earnings and an estimate of its powers in that direction in the future. If you desire to buy stock in a company, whose shares have all been taken up, you must find some holder willing to sell, either by your own seeking or the employment of a stock broker. What you pay for the shares is a private bargain between yourself and the holder, with which the company cannot interfere. If the company whose shares you buy is a large and important concern, like a loan company or a bank, the stock will be quoted on the stock exchange, and you will be guided in your purchase by the latest quotations. Dividends and Rests. — It seldom occurs that any properly managed company declares a dividend (division of profits) amounting to the full sum of its earnings. The proper course is to reserve a certain sum annually, to provide against possible future contingencies. Our chartered banks have a Rest Account to the credit of which a certain sum is carried annually from the Profit and Loss account, until it reaches a certain proportion of the Capital Stock ; and it is customary also with them to leave a certain amount at the credit of Profit and Loss. The prosperity of the Bank of Montreal, selecting it as the most prominent example, is, in a large measure, due to following this wise course. Its *' rest " now amounts to over six millions of dollars ; that is, out of its earnings, it has set aside from year to year sums that now amount to this figure. The bank would have to lose in ibad debts the sum of over six millions before its capital would be impaired. Besides the provision which the possession of a " rest " makes against unforeseen contingencies and bad debts, it serves the exceedingly useful purpose of enabling the company to pay as nearly as possible a uniform dividend from year to year. In any one year the profits of a company will not be precisely the same as those of a previous year, but the possession of a rest will enable the directors to equalize the dividend, and preserve the stock ofl the company from the fluctuations in price, to which the constantly changing rate of | dividend would subject it. Dividend Stock. — Dividend Stock will be most easily explained by giving an I example : We will suppose that a certain gas company has been in existence a score I of years in a prosperous community, enjoying the monopoly of supplying it with light. [ The price charged is high, and in consequence the company is making large profits;! so large, indeed, that the directors fear that if the facts should become known, theyl will be confronted either with a demand for a reduction in the price, or the formation | of a rival company. In order, therefore, to make it appear to the consumers that the! profits are not excessive, they declare a reasonable dividend in cash, and place al certain amount to the credit of the " rest " account, of which the public are informeA| and they also distribute a dividend in stock, of which the public are not informed. When this has been done for a number of years, the capital stock will havel greatly increased — we will say, for the purpose of illustration, to double the originall an 191 money paid in. Now, while the annual profit upon the original capital, if it were ar, that is, ■ )jnown to the public, would appear excessive, the prolit upon both the original stock company's ■ ^^d dividend stock combined is reasonable, and the directors say : — " Why, we are iT be at par. ■ ^^ly making eight per cent, of profit on our capital, and cannot afford to sell gas for ; par in ihe ■ jggs than we are now charging." bscribers, a ■ j^^ entries in the books of so fortunate a company, for distributing the profits, 11, and their ■ ^^ indicated above, would be as follows :— le efficiency ■ Dowers in I ^^ ^^® credit of profit and loss account there stands, say, the sum of $16,000 as hose shares I ^^^ "^* profit for the year upon a capital of $100,000, this is 16 per cent. A jv your own I dividend of 7 per cent, in cash is to be paid, 2 per cent, is to be placed to the credit of shares is a I f^*^ account, and the balance is to be paid in stock. 3any cannot I Profit and Loss, Dr. $16,000. int concern, I To Dividend l7,ooo V „„j I " Rest 2,000 change, and I •• Capital Stock 7!ooo When the dividend has been paid, and the entries have been made for it, red company ■ Dividend account v.iU close. In the stock ledger, credit each shareholder with his its earnings, I proportion of the $7,000, and issue certificates. In doing this, of course, there will ainst possible I be fractions of shares to be credited in some cases. the credit of I The above mode of creating stock is simply equivalent to the existing ount, until it ■ shareholders subscribing for new stock and paying for it out of the earnings of the old Iso with them ■ stock. The only objection that can be urged against it is that it deceives the public sperity of the ■ regarding the company's profits, and by the manipulation the company maintains arge measure, H excessive prices for its wares. In the case of a company in which the public has no lix millions of fl interest there can be no objection at all to the payment of stock dividends. iums tan ■ Watered Stock. — There is another method of creating stock, called watering, ^"™ ° u B ^° which serions objection may be urged. It is the writing up of the value of assets on wnic ■ ijgyQjjd their cost or worth, or the creation of fictitious assets, say " Good will," for baa ae , ■ jxj^jjpig^ jj^g crediting of capital stock with the amount, and the issuing of shares to r as near y ■ ji^^ extent of the inflation. We can only suppose a very few instances where such a le pron s ■ course would be honest or justifiable. One would be the case of a mine, for which the possess Bsjy $100,000 had been paid, but which proved, by the operation of years, to be - * ^ °^ ■ worth a much larger sum. langing rate 01 ■ ^ * ■ Conversion of Private Partnerships into Joint Stock Companies. — In Great Britain within the last twenty-five years, and latterly to some extent in Canada, by giving anBj^d largely in the United States, the conversion of private partnerships into joint stock istence a scoieBjQmpj^^ies has become very general. In all branches of commerce you will observe mg it with light. Bsuch gjgj^g ^^ u Rj^e. Lewis & Son, (Limited)," and on making inquiry regarding the g large profits .■chj^gg^ j^ ^jU generally be found that it was effected at the death of some of the e known, tbeyBo,igi„^j partners, whose interest in the concern has been inherited by a number of ir the formation ■ijgjj.g ^^^ desire to retain the interest in the business, but take no part in its manage- umers that t^B^g^j^ ^^j. jncur any responsibility for its liabilities. An old established firm that n, and place iiBnight otherwise cease to exist, for death dissolves a partnership, is thus preserved, c are informed*|,g managemnet remains undisturbed, the shares are in the hands of the families of it informed. Mg original partners, who, without risk or anxiety, enjoy the fruits of the labors of tock will havcBhose whose heirs they are. When any of these desire to sell their shares, they have ble the originalpimply to find a purchaser at will. It has latterly become quite common for manu- n^ f <• * i* *• , .«•• ' 192 5i facturers in the Dominion to convert their concerns into joint stock companies ; the object being to extend their trade by the introduction of new capital, which could not be obtained on the ordinary partnership or special partnership principle, but only on that of limited liability. The former owner will take the price of the property in paid- up stock. In opening the books under such circumstances, make the plant and other property accounts debtor for their respective values to capital stock; credit the mnn in the stock ledger, and give him a stock certificate for the number of shares. The new stock and stockholders will be dealt with as before described. Services Paid in Stock. — Services are sometimes paid for by the issue oi stock. A company which had not issued all the stock authorized by its charter, being desirous to reward a president for his services, might do so by giving him say ten shares of paid-up stock. The Journal entry would be : Expense Dr. To Capital Stock, and in the stock ledger the president would be credited with ten shares, and he would receive a certificate for that number. Subscribed but Unpaid Stock a Resource. — It is not unusual for companies, other than banks, which desire to secure public confidence, without which they could not exist, to obtain subscriptions for stock to a much larger amount than the capital necessary to carry on their affairs. To illustrate — a life insurance company must command public confidence to be successful. The capital required to carry on its operations beyond the amount deposited with the Dominion Government, in the interest and for the security of policy holders, is small in comparison with that of a bank or an important manufacturing concern ; but the permanence of the company and the ability to pay its liabilities to the widows and orphans, who will be its chief creditors, is of vital importance. By obtaining subscriptions for stock to an amount much larger than the capital required, and calling up say only a fourth of the amoun*, it has a reserve which, in the event of its being required, can be called for at any time. This reserve in the case of life insurance companies is as tangible an asset as the double liability resource of a bank. Bonds or Debentures. — When joint stock companies borrow money for a long period, they do so by the issuing and disposing of bonds or debentures, which are negotiable instruments, payable to the bearer, and attached to which are interest coupons, usually two for each year of the time for which the bonds are to run. The bonds of a railway or mining company are usually sec-ed by a mortgage upon its property held by trustees for the bondholders, and they are called first mortgage bonds, if the mortgage is the first lien upon the property. Loan companies borrowj money upon their bonds, not, a" in the case of the railway or mining company! because they are hard up, but to obtain money at a cheap rate to lend at a high rate,! If the company be an old and sound one it could probably borrow at par in England! upon its bonds at four per cent. The proceeds would be brought to Canada and! loaned at say seven or eight per cent, the result being a handsome profit upon fundsl not contributed by its shareholders, just as the banks make a profit by loaning thej funds left with them on deposit. The difference between a stockholder and a bondholder of a company will, ol course, be apparent — the stockholder is a partner, the bondholder is a creditoiJ Govern I of the G of the te Spe hitherto large am to delive ticular ja A contra( ticular st( amount, I ket, the s; pocket a 1 must keep turn takir all he has a bet that to be, the (this is an tions), sucl name " bul certain sha " corner " i becomes kr stock, adva; can get hoh holders hav greatly advj when the ta whereby, fo take or deli price. LiQvir for a debt a into liquidal order, after grant the or books. Aft Istockcanbe deems it bes 'ions of the to wind up. enforced aga h suit, but Jmust not de lofiicial capac p the Court H left for t paid over to " S. 0. i88 poiNT Stock 'Ontario Bus 193 nies ; the could not t only on y in paid- and other it the man ires. The le issue oi its charter, ng him say id he would r companies, h they could .n the capital (mpany must > carry on its ment, in the vith that of a the company I be its chief to an amount | ,f the amoun*, led for at any I e an asset as] money for a jntures, whicli :h are interest to run. The hgage upon its first mortgage [panics borrow ling company. 1 at a high rate. jar in England' |o Canada andl )fit upon fundi| |by loaning M jmpany will, oi is a creditoiJ Governments and municipalties also borrow upon debentures or bonds. The bonds of the Government of Great Britain are called " Consols," which is an abbreviation of the term " consolidated bonds." Speculation in Stocks.— The purchase and transfers of stock, to which I have hitherto alluded, have been genuine sales, and can be easily understood. There is a large amount of speculation in stocks, however, in which there is no intention actually to deliver and receive them This is called "buying on margin," which, with the par- ticular jargon used in connection with it, is not easily understood by the uninitiated. A contract is made through a broker to buy a certain number of shares of some par- ticular stock at a fixed price, within so many days— a margin, say five per cent, of the amount, being placed in the hands of the broker. Should the stock rise in the mar- ket, the speculator may order his broker to sell, and after paying him his commission pocket a handsome profit ; on the other hand, should the stock decline, the speculator must keep up his margin by making further payments, and it may be that, no favorable turn taking place immediately, he is unable to continue to carry the stock, and loses all he has invested. It will be seen that this kind of speculation simply amounts to a bet that a particular stock will be above a certain figure in the future. If it prove to be, the speculator wins ; if not he loses. Some curious phrases are used on 'change (this is an abbreviation of Stock Exchange, where the brokers carry on their opera lions), such as " bulls and bears," *' corner," " short," '• long," " put " or " call " The name " bulls " is given to those dealers who are endeavoring to force up the price of certain shares, and those are called '* bears " whose object is to lower them. A "corner " is the result of certain operations between these opposing forces. When it becomes known that there is a large number of " short contracts " out in a certain stock, advantage is taken of the fact by the buyers, who purchase all the shares they can get hold of, so that when the time arrives for the fulfilment of their contracts, the holders have the " shorts " at their mercy. The latter are compelled to purchase at greatly advanced prices, and are " cornered " unless they can break down the corner, when the tables may be turned upon the " longs." A '• put " or " call " is a contract whereby, for the payment of a small sum of money, one dealer may require another to take or deliver within a limited time, say one day, a certain amount of stock at a stated price. Liquidation. — A Joint Stock Company, upon which ^ demand has been made for a debt amounting to $200, and which remains unpaid a"' c" 60 days, may be forced into liquidation by its creditors. Application is made to the Court for a winding up order, after four days' notice to the Company. The Court may, in its discretion, grant the order forthwith, or adjourn to make inquiry. The Company must show its books. After the order has been made, and a liquidator appointed, no transfer of stock can be effected, and the business of the Company must cease unless the liquidator deems it best that it should go on. With the appointment of the liquidator, the func- tions of the directors cease, for in him is vested full power to do all things necessary to wind up. He may appoint a solicitor to assist him. An execution cannot be enforced against a company in liquidation, and remedy against it cannot be obtained by suit, but by an order of the Court. The liquidator is subject to the Court. He must not deposit the company's money in the bank in his own name only, but in his official capacity, and he must produce the bank pass book at meetings. He is paid las the Court directs. After the final order is made the money in hand is deposited land left for three years, subject to any legitimate call, and at the end of that time it is 'paid over to the Receiver-General. The Statute of Liquidation in force in Ontario is IR. S. O. 1887, Cap. 183. The Dominion Winding-up Act is R. S C. Cap. 129. For Joint Stock Company Book-Keeping, see J. W. Johnsons work : " Johnson's oiNT Stock Company Book-Keeping," (now in the seventh edition)^ published by Mario Business Coilege, Belleville. 194 AUDITING. «i« »« l>- To audit is to thoroughly examine and report upon the work of an accountant, The value of an audit rests solely upon the competence, honesty, and independence of the individuals who make it. If they are not thorough accountants it is unreasonable to expect that they will be able to detect accidentally or wilfully false entries, or form an intelligent opinion of the work they have undertaken ; hence a report under such circumstances is the very opposite of the security desired, and which an audit by competent men would afford to a company or corporation. That auditors should be men of established character for probity it is unnecessary to point out, and that the reliance to be placed upon the work they perform is largely reckoned by their independence, and their being uninfluenced by interested parties, is equally plain. We argue, therefore, that Companies or Corporations are equally bound to employ competent accountants who possess the moral qualities indicated, as auditors, as they are to employ only such to keep their books. Auditors for Joint Stock Companies are appointed by the Shareholders at the annual general meeting. The reason why the Shareholders, and not the Directors, should make the appointments is very plain. The Officers of the Company are largely controlled by the Directors, and the audit being, so far as this connection goes, an examination of the faithfulness to the Shareholders of both the Officers and Directors^ it is necessary that the Shareholders themselves should appoint the Auditors. The duty of Auditors is laid down in the Company's By-laws, which would be somewhat as follows : — '• One or more Auditors shall be appointed annually by the " Shareholders at the annual general meeting, whose duty it shall be to examine and "audit the books and accounts of the Company, and any and all documents having " reference to the business of the Company, and prepare from the Company's books " a balance sheet and abstract of the Company's affairs, to be submitted to the " Directors on the last Monday in January, accompanied by any recommendations or "suggestions they may deem proper." The Auditors upon being duly appointed should at once begin their duties, as a long delayed audit is far less effective than a prompt one, particularly if only one audit takes place in the year. The proper manner of conducting an audit is to begin at the books of original entry, at the same time using the auxiliary books and examining vouchers. The Cash Book might be gone through for the first month and compared witlil the vouchers ; then the Day Book and Journal entries for the same time should be compared, those of the Day Book being verified (as well as those in the Cash Book)| from vouchers, documents, auxiliary books, drafts, notes, etc., etc., and proceed this way from month m UK *<*«m* 106 BANKING. •u ^;: 4 )' Banks exist primarily for the purpose of loaning money, which they do principally upon the security of promissory notes and bills of exchange. They not only loan the capit.il belonging to the stockholders, but also the money deposited by the public. The loans made by the banks are called discounts. Wholesale trade is largely done on credit, the customers giving their notes or acceptances at three or four months for the goods they buy. This paper, after being endorsed, is discounted— that is, money is borrowed upon it at the banks, the amount paid for the loans being the interest (usually about 7 per cent, per annum) on the face of the paper from the date of discounting to the date of maturity, which always includes the three days of grace. The net proceeds are usually placed to the firm's credit, as a deposit would be, and are available thereafter. It will be observed that in discounting a note, payment is made for the use of the money, not at the end of the period for which it was borrowed, but at the beginning, and in this will be seen the difference between bank discount and true discount. Besides discounting commercial paper, the banks make collections, advance money on warehouse receipts and bills of lading, covering grain and other agricultural produce, on lumber and other merchandise, and buy and sell foreign exchange, created by the exports and imports of the country. They are also empowered in Canada to issue paper currency, limited only by the amount of their paid-up capital There are heavy fines if this is exceeded, graded according to the extent of the over issue. These penalties, however, do not form a charge upon the assets until the other liabilities are paid. The notes issued must be for not less than $5 00 or multiples of $5.00. The Government reserves the power to issue all bills of lower denominations. In getting payment from any bank a person can demand and compel $60.00 of that payment to be in small notes of Dominion issue. The banks are bound to keep 40 per cent, of their reserves in Dominion notes. The system of banking pursued in Canada approaches nearer to the British than the American plan, but it is sufficiently distinct from either to be Canadian. The British system has been followed in establishing institutions with large capital, having a head office in an important centre, with branches in various cities and towns. The Bank of Montreal, for instance, has a paid up capital of twelve millions of dollars, and a rest saved out of earnings of over six millions, and has over forty agencies, in each of which deposits are received, discounts granted, and the same general banking | business carried on as at the head office. By the term " The Banks " is always meant the Chartered Banks, which are I Joint Stock Companies, organized under Dominion Legislation, and acting not only under their own separate charters, but subject to the General Bank Act (to which reference is made hereafter). * The shareholders of any Joint Stock Company in Canada other than a bank have no liability beyond the amount of the shares they have subscribed for, but 'the shareholders in a bank are liable in the event of the! bank's suspension to be called upon to pay double the amount of the stock they havel subscribed for, should the existing assets not be sufficient to meet its liabilities. [ This requirement of the law is primarily in the interest of bill holders, because theyl are involuntary creditors, the bills of the banks being largely the money current in| Canada. * There are a few exceptions to this, but only in the case of companies established many years ago. 197 they do They not 306ited by le trade is it three or counted— oans being ;r from the ee days of }Osit would ng a note, "or which it ce between ns, advance agricultural \ exchange, [jpowered in d-up capital, of the over ets until the lan $5 00 or bills of lower demand and The banks British than ladian. The Private individuals may do a banking businesss — that is, they can receive deposits, discount paper, make collections, etc., but they cannot, of course, issue paper currency. Private bankers are required by law, under severe penalties (a fine of $1000.00 or imprisonment for not more than five years), to carefully avoid the use of any name in connection with the office or place of business that would lead ignorant people to mistake them for, or confound them with, the chartered banks. THE NATIONAL BANKINO SYSTEM OK THE UNITED SIWIES. IJefore discussing the history and present ( onstitution of Canadian Banking, namely the Bank Act of 1890 (53 Victoria, chap. 31), which came into operation on the ist of July, 1891, it will be well to deal briefly with the chief characteristics of American Banking. The National Banking system of the United States was the creation of a great statesman (Secretary Chase, Secretary of the Treasury in Lincoln's administration) at a critical time in the Nation's history. It originated during the war, and was created incidentally to aid in carrying it on, but primarily to remedy the evils of the State Banking System, under which hundreds of small banks with State charters only, issued currency without security beyond that of the weak institutions that issued it. Such currency was only accepted in the immediate neighborhood of the local banks ; a few miles away the notes were not taken at par, and at a distance they would not pass at all. Under the National Banking Act, a national currency was created, having as security for its redemption the deposit with the National Government of United States bonds. Absolute security is thus assured to the bill holder of any National Bank. For example, you may hold bills, say of a bank in Maine, of which you know nothing,— indeed, it may have become insolvent ; but owing to the fact that for every 1 dollar of its currency it was obliged to place with the Government U. S. bonds to [secure its redemption, you give yourself no concern about the bank's financial Iposition. In brief, the bill holder's security is the credit of the National 1 Government. The creation of the National Banking System, however, did not deprive the apital, having Iseveral States of the right to grant bank charters, with note-issuing powers ; but the towns. The Hexistence of a federal tax of 10 per cent, per annum renders the power inoperative. af dollars, and ■ j^^ absolute security afforded by American currency makes it one of the best ncies, m eac » ^j^^ ^orld, so far as the bill holder is concerned, but as a currency adequate to the leral banking ■requirements of the country's commerce, as much cannot be said. It lacks the power f expansion and contraction essential to changing circumstances. American banks :erive no profit from their circulation, and there is no incentive to keep it out. I'hen an increased demand comes— say in the fall, when the crops are being moved — hey cannot, as Canadian banks do, issue their own promises, and thereby create loney to meet the temporary demand. The currency of the National banks of the United States being secured as - event of ^"^Bescribed, it may be termed, and is indeed, a National currency, accepted at par from tock they)^ave»g^jj^^^j^ ^^ ^j^^ Pacific; but while the currency is worthy of the name, the banks its liabuities.«gj^j^gj^^g ^^^ rnerely local institutions, doing business in one locality. , because _ ■ American banks have no branches, They simply supply local wants, and are not ney curren 1^^^^^.^^^^ ^^^^^ ^j^^ requirements of communities beyond their own, and consequently 10 bank can attain to national importance. The name National, then, does not ks, which are ting not only Act (to which Company in ■le shares they I '* •.-Ml"'* 198 I -J' V« come from the importance of the individual institutions, but from the fact that they are organized under the National Government, and not merely by State authority. A separate Act of Congress is not required to form a National bank. It is created under a general incorporation act, by the promoters complying with the forms prescribed. HOW A UNITED STATES NATIONAL BANK IS CREATED.* The proceedings connected with the creation of a National Bank are, in brief, as follows : Seven or more promoters of the new bank have met and decided that it is desirable to establish the new institution, and they propose that its name shall be " The Merchants National Bank of Sawyerville," and the capital stock is fixed at $100,000. AI'PLICATION TO THE COMPTROLLER. The first step that the promoters take is to make a written application to the Comptroller of the Currency at Washington (who is the officer in charge of this department), giving the desired title of the bank, the location and proposed capital, and pledging themselves to become stockholders of the organization. This applica- tion must have the endorsement of the Congressman from the district in which the | bank is to be located. The Comptroller makes inquiries about the needs of Sawyer- ville and the character of the men, and if everything is satisfactory, sends some blanks! for the signatures of the prospective stockholders. Next, articles of association are entered into, which specify in general terms the object for which the association is | formed, and contain certain provisions (not inconsistent with law) which the associa- tion has seen fit to adopt for the regulation of its business and the conduct of its affairs. A copy of these articles, signed by each of the gentlemen, is forwarded to| the Comptroller of the Currency, to be filed and preserved in his office. This done, an " Organization Certificate " is executed, which specifies the name,! location and amount of capital stock of the proposed bank, together with the naraesj and places of residence of the shareholders and the number of shares held by each ( them. Every director, according to law, must, during his continuance in office, bel the bona fide owner of at least ten shares of stock of the par value of $100 each, whichj shares must not be hypothecated or in any way pledged as security for any loan orl debt. This certificate of organization, bearing the signature of every shareholder, andl acknowledged before a judge of a court of record or a notary public, is transmitted] to the Comptroller of the Currency. THE CAPITAL PAID IN. Meanwhile the promoters, mindful of the law which says that at least 50 pej cent, of the capital stock of an association must be paid in before the association will be permitted to begin business, have collected the necessary $50,000. They statJ this fact in a certificate which they send to the (Comptroller of the Currency, at th^ same time declaring that all the provisions of the law with reference to organizing 1 bank have been observed. The Comptroller, if he is satisfied that the law has beei properly complied with, gives to the association a certificate authorizing it t| commence the business of banking. The balance due on the stock must be paid i in monthly instalments of 10 per cent, each, the first instalment to be paid on tbj • " From Business," New York. Every Ihe same pri pes for the ptheCurre rWch may 199 rED.* are, in brief, ;cided that it ime shall be :k is fixed at cation to the :harge of this posed capital, This applica- in which the | eds of Sawyer- is some blanks I association are association is| ich the associa- conduct of its I is forwarded to I :ifies the name, with the namesi held by each ofl ce in office, bel loo each, whichi "or any loan otl ihareholder,and| :, is transmitted! at least 50 pei association viil' DO. They stall Currency, atthi to organizing ,he law has bi uthorizing it '( must be paid « be paid on tl thirtieth day from the date of the Comptroller's certificate of authority to commence business. They must, without delay, deposit with him United States bonds equal to one-fourth their capital stock, and this whether or not they conclude to take out circulating notes. But they may deposit with him a larger amount of bonds (so it is not in excess of their capital stock actually paid in); and will thereupon be entitled to receive from him circulating notes e(iual in amount to 90 per cent, of the par value of such bonds. ISSUING CIRCULATING NOTES. We will suppose that the directors have concluded to issue circulating notes. Before they can do this they must deposit their bonds. The capital stock of $ioo,coo is all paid in, and United States 4's are quoted at 1 24. So the directors see that they can buy in round numbers only $80,000 of bonds with their $100,000, allowing for brokerage, express charges and a little balance of ready cash. An order is sent to a banking house in New York to buy the bonds — regi.stered bonds, /. e., bonds which have the name of the payee inscribed upon their face, and which are payable to such piyees or their assigns only. The order is duly executed, and in a few days the bonds arrive. They are assigned by the directors to the Treasurer of the United States, in trust for the National Commercial Bank of Sawyerviile, and are sent forth- with to that officer, to be held by him as security for such an amount of circulating notes as, under the law, he is authorized to issue to the new bank. The bonds are then done into a neat package, lettered and labeled, and assigned a place in one of the numerous pigeon holes of the big vault of the Treasurer of the United States. Once a year the bank sends an agent to examine the bonds and see if the record of them is correct, and if such is found to be the case, a certificate to the Treasurer to that effect is executed. The Treasurer next sends a document to the Comptroller of the Currency stating that he holds the bonds, and the Comptroller issues an order for printing $72,000 of notes in the name of the Merchant's National Bank of Sawyerviile. This is 90 per cent, of the par value of the bonds, the Government requiring a margin of ten per cent, to protect itself against a possible depreciation of I the bonds. The preparations for beginning the business of bankimr are now complete. This [business is now restricted by law, and consists of the discounting and negotiating of promissory notes and other evidences of debt, of the receiving of deposits, of the buying and selling of exchange, coin and bullion, and of the loaning of money on personal security. Loans on real estate are not permitted, as this is a security which lis not readily convertible, and a National bank, save the building wherein it transacts its business, can hold real estate only : i. By way of security for or in satisfaction of [debts previously contracted in good faith. 2. By way of purchase under sales ordered )y courts in order to secure debts due the bank. And such real estate cannot be leld for a longer period than five years. Nor may a bank loan money on the security )f its own capital stock or make accommodation loans to any person, company, corporation or firm, to an amount exceeding one-tenth of its capital. Every association under this law, whether in Maine or in Texas, is governed by [he same principles, is subject to the same inspections, and is under the same pcnal- [ies for the violation of any duty. Every association must make to the Comptroller )f the Currency not less than five reports during each year, according to the form 'hich may be prescribed by him, verified by the oath of the president or cashier. 200 UK S These reports must exhibit in detail the resources and liabilities of the association at the close of business on any past day (sfc) specified by the Comptroller, and must be transmitted to him within five days after the receipt of a requisition from him. The advantage to the people of this system is the existence of a power above the bank, to which they can appeal if injustice is done them. CANADIAN BANKING. Each bank in Canada has its own separate charter from Parliament, but all are subject to the General Bank Act. It is not within the power of a Provincial Parlia- ment to create a banking corporation. Capital authorized means the limit to which stock can be issued under a bank's charter ; Capital subscribed means the amount of stock that has been taken or sub- scribed for ; Capital paid up means the amount of cash actually paid in upon the stock subscribed. The General Bank Act now in force in Canada, under which every Chartered Bank in the Dominion carries on its operations, v/hich regulates the currency, and to the requirements of which every new bank that may seek incorporation must submit, is that passed in the session of 1890, and which became law on the ist of July, 1891. The banking legislation that existed prior to the present act was faulty in two important points ; .t made the creation of new banks too easy, by permitting them to come into existence with a capital paid in of only $100,000; and it did not provide for the adequate securing of the currency issued by the banks, nor insure its passing] at par. The amendment made in regam to the capital of a new bank is that it cannot bel opened unless at least a quarter of a million of dollars has been paid in and actuallv| placed on deposit with the Government. The defects in the bank note currency prior to the passing of the present act weiel two : (i) The currency of the banks did not pass in the various provinces at par,- indeed much of it would not be accepted at all a few hundred miles from the place of issue. For example, the bills of a Nova Scotia or New Brunswick bank would not be accepted in Ontario. The public, knowing nothing of the solvency of the bank that issued the notes, would not receive them. (2) When a bank suspended payment, the holders of its bills who could not afford to hold them until the liquidators had realized sufficient of the bank's assets to redeem them, were obliged to part with theiii| at a discount, involving in many cases very serious loss. Security did exist for holders to some extent, as the bills were a first lien upon the assets, which include(l| the double liability of the shareholders. The new legislation most completely remedies these two defects, (i) It provide and insures that all notes shall pass at par throughout the Dominion by the followinj regulation : — Each bank sliall make such arrangements as may be necessary to ensure th^ payment at par in any and every part of the Dominion of all notes issued by it, anil for this purpose it shall establish agencies for the redemption and payment of notes at Halifax, St. John, Charlottetown, Montreal, Toronto, Winnipeg and Victorii B.C., and at such other places as may be designated by the Treasury Board. In a recent case it was decided that Government claims upon an insolvent b: It was pass to the ' The returns I'urnal, The Hon M penalty for i ssociation at ind must be him. The the bank, to It, but all are 'incial Parlia- nder a bank's | taken or sub- , in upon the I ery Chartered •rency, and to must submit, of July, 1891, s faulty in two litting them to I lid not provide I sure its passing lat it cannot bel in and actuallyl resent act were ?inces at par,- jm the place ofl k would not be f the bank that :d payment, thel iquidators hadl part with them d exist for which included! (i) It provide jy the following to ensure the 5ued by it, an( payment of ii eg and VictoiiJ Board. insolvent bi 201 took precedence of the claims of note holders. The new bill corrects this anomaly. It declares that the note issue shall be a first charge upon the assets, that the amounts due to the Government of Canada shall be the second charge, and that amounts due the Governments of any of the provinces shall be the third. (2) The new Act provides and insures that no loss shall accrue to the holders of the bills of a suspended bank by the following regulations : Each bank shall keep on deposit with the Government a sum equal to five per cent, of the average circulation, and this is to be determined annually from the average, as shown by the monthly returns which the banks are required by law to make to the Finance Minister,* The amounts so deposited shall form "The Bank Circulation Redemption Fund," which fund shall be held for the foUowinj; purpose, viz.:— In the event of the suspension by the bank of payment in specie or Dominion notes of any of its liabilities as they accrue, for the payment of all notes then issued or reissued by such bank, and intended for circulation, and then in circulation, and interest thereon. The fund shall bear interest at three per cent. In the event ot suspension the notes then in circulation shall bear interest at the rate of six per cent, per annum, from the day of suspension to such day as shall be named by the directors or the liquidator for the payment thereof, of which day notice shall be given by advertisement in a newspaper published in the place in which the head office of the bank is situate ; but in case any notes presented for payment after the day named for payment thereof should not be paid, all notes then unpaid shall continue to bear interest to such another day as shall be named for payment, of which day notice shall be given in the manner above provided. In case of failure on the part of the bank to make arrangements within two months from the day of suspension for the payment of all of the notes and interest thereon, the Minister of Finance may make arrangements for the payment of the notes remaining unpaid and all interest thereon out of the redemption fund, and shall give such notice of such payment as he thinks expedient, and on the day named by him for such payment all interest on the notes shall cease. All payments made from the fund shall be without regard to the amount con- tributed by the suspended bank. In case the payments from the fund shall exceed the amount contributed by such suspended banks, the other banks shall on demand make good to the fund the amount of such excess, pro rata to the amount which each bank has at that time contributed to the fund, and all amounts thereafter recovered and received by the Minister of Finance from the bank on whose account such i payments were made shall be distributed among the banks contributing to make good I such excess, pro rata to the amount contrib .ted by each. In the event of the winding up of a bank, the Finance Minister may, on being Satisfied that proper arrangements have been made for payment of these notes, pay |over the amount remaining in the fund to the credit of the bank. UNCLAIMED MONEYS. It was originally intended that all unclaimed dividends and balances should Ipass to the Government. But it is provided instead, that a list of such of these * The returns alluded to above are printed in the Canada Gazette monthly, and are reproduced by that excellent iournal, The Monetary Times, published in Toronto. The study of these returns will prove interesting and instructive. ^he penalty for malcing false returns under the new act is imprisonment for a period not exceeding five years. 202 dividends and balances as are of five years' standing shall be furnished to the Govern- ment for publication every year. In case of insolvency the unclaimed money is to go to the Government for safe keeping. MINOR POINTS OF THE BANK ACT. The old law stipulated that all directors should be British subjects by birth or naturalization. But this requirement has been modified. A majority only of the directors need be British. Under the old law, too, each director had to hold a certain proportion of stock, for example, $3,000 worth, if the entire capital stock aggregated a million, and $4,000 worth, if over a million and less than three millions. It was not necessary, however, that the director should have paid one cent upon this stock. The new law makes the payment of $3,000 in cash compulsory, where the entire stock is a million, and $4,000, where the stock exceeds a million. Every director must thus have a cash interest in the institution he directs. A protective clause prohibits the pledging, assignment, or hypothecation by a bank of its own notes. A bank under the former law, as a last resort, might endeavor to raise money on notes it could not issue in the ordinary way. Seeing that notes are a first lien upon the assets, the practice would establish preferential claims. The punishment for this offence is a fine and imprisonment. Further regulations of a protective character to shareholders require that no bank shall declare an annual dividend exceeding eight per cent., unless it has a reserve equal to thirty per cent, of its capital, and that all banks shall in their annual reports indicate their losses as well as their profits. SALES OF STOCK ON MARGIN PROHIBITED. One of the striking points in the law is a provision rendering the sale of stock on margin illegal, and indeed penal. The thirty-seventh section provides that all sales and transfers of shares, and all agreements in respect thereof, shall be null and void unless the person making such sales is at the time thereof the registered owner of the shares in the books of the bank. It also sets forth that in all sales the registered numbers of the shares shall be mentioned. Any person selling a share by a false number, or selling a share of which he is not the registered owner, or selling a share | without the consent of such owner, shall be guilty of an offence against the Act. This clause is to prevent jobbing in stocks or selling on margin. There canbel no sales but />onn fide sales ; no transfers but bona fide transfers. Neither should I there be under it any assault extraordinary upon the stock of a bank. The require- ment that all transactions shall be in actual stock, duly registered, removes the tempta- tion to elevate or depress quotations by reports, false or otherwise. It is an importantj change in the law, destructive of the opportunities to speculate. This principle, wel believe, is to be found in the English Banking Act, into which it was imported \vitha| view to the suppression of over-speculation and the avoidance of its results. The liability of shareholders who have sold and transferred their stock does notj cease until sixty days after suspension, in place of thirty days, as before. Proxies must be renewed every two years instead of three, and they must be| produced and recorded thirty days prior to a meeting, in order to qualify directors. 203 the Govern- ney is to go by birth or only of the ion of stock, I, and $4,000 iry, however, V law makes million, and have a cash lecation by a ight endeavor ng that notes claims. The e that no bank has a reserve annual reports | iale of stock on that all sales ; null and void owner of the I the registered! lare by a false I selling a share] t the Act. There can be I Neither should The require- »ves the tempta-l is an importantj s principle, wel imported with a| isults. stock does not| re. i they must be| lify directors. WHAT BANKS CANNOT DO. Banks are prohibited from buying or selling goods, wares and merchandise or from engaging in any trade or business whatever. A bank is not allowed to make advances upon thi security of its own shares or the shares of any other bank, and it cannot lend money or make advances ; pon the security of mortgages on land or chattels, or upon the security of any kind of merchandise except as below. WHAT BANKS MAY DO BEYOND ORDINARY DISCOUNTING. Banks can take mortgages, hold and dispose of them by way of additional or collateral security for debts contracted in the course of business ; and they may acquire and hold any warehouse receipt or bill of lading as collateral security for the payment of any debt incurred in their favor in the course of banking business. Banks may lend money to a wholesale manufacturer upon the security of the goods manufactured by him, or procured for manufacture ; and they may lend to a wholesale purchaser or shipper of products of agriculture, the forest and mine, sea, lakes and rivers, or the wholesale purchaser or shipper of live stock or dead stock and the products thereof, upon the security of such products. A form of security for loans thus secured is given in the Act in Schedule C. REVIEW OF THE ADVANTAGES AFFORDED. We have now in Canada a most excellent Banking System, well suited to the re(iuirements of a country extending across a continent, and we have a currency as sound and well secured as any in the world. The Shareholders of Canadian banks possess profitable investments j not only is the capital paid in employed in earninc; an income for them,, but the reserve fund, created out of the profits of former years, as well as the money deposited with the bank by the public, are continually employed, and this accounts for the high dividends they receive. Take the Bank of Commerce as an example. In its statement to the Government ending August 31, 1891, it shows over eighteen millions and a half of dollars under loan. The cipital paid in by the shareholders is six millions, its reserve fund is a little less than a million ; so that while its own funds are under seven millions, yet at this date there were eighteen millions and a half of dollars employed by the bank. A large portion of the money deposited does not bear interest, and the balances only 3 or 3^^%, while from 6 to 8% is received by the bank for it The Depositors are afforded a safe place for funds which may be temporarily unemployed, or for funds which they prefer to keep in the banks at a comparatively low rate of interest, rather than run the risk incident to speculative investments on their own account. The Borrowers from the Atlantic to the Pacific have the amplest facilities to obtain loans from strong and reputable institutions, that can have neither the necessity nor the disposition to " squeeze " them. By our system of branches, the money on deposit in a community in excess of local demand, is moved to other localities where enterprise is keener, and thus the flow of capital is constant in the various directions in which it is needed. The great Bank of Montreal, for example, is not merely concerned about the trade of the metropolitan city in which its head 'm fell •204 4« c: '«» office is situated, but it is equally concerned about the trade and well-being of each city, town and village in which it has a branch, and to the number of over forty its branches are scattered throughout every province of Canada. The Bill Holders, who are involuntary creditors of the banks, are now secured beyond any possibility of loss, as before described. Inflation of the currency is rendered impracticable by the continuous daily redemption of the currency between the banks themselves, while healthy expansion and contraction are regulated by the simple law of supply and demand. It is truly a National Banking System, when, as we have shown, the banks are interested in the trade of every locality, and every individual is personally inter- ested in the banks, as shareholder, depositor, borrower or bill holder. At a meeting of the American Bankers' Association, held in New Orleans, La., on Nov. 13, 1 89 1, Mr. Wm. C. Cornwell, cashier of the Bank of Buflalo, N. Y., read a paper on Canadian Banking. In it he gave it as his opinion that, with the excep- tion of Scotland, Canada had the best Banking System in the world. THE PRINCIPAL BOOKS USED IN A CANADIAN BANK. Notes of Deposits Deposits i Balances ( Balances ( Balances d Unclaimed Dividend I Capita! pai< Rest Balance of Balance Book, Bills Discounted. Letter Book. " •' Deposit Ledger. Minutes of Inspection. " " Liability Ledger. Parcels (Money) Rec'd and Sent Book. « " Savings Bank. Pass Books. | Specie - Balance Sheet Book, (t " Savings Bank. Dominion N Cash Book, ordinary. Register of Bills Discounted. | " '• Alternate days. (( Trade Bills Remitted. Notes of and " Head Office. « Cash Items. Balances due Balances due British and ( " " Supplementary. « Collateral Notes. Character Book. (( Collection. Call and Sh( Collection Receipt Book. ft Deposit Receipt. Copying Book, Letter with Index. (t Description of Farm Properties. T' T " •' Liability Statement. It Draft. lime Loans 1 '* " Tri-weekly Return. u Draft Paid. wilier currcn Bills Discoun Daily Financial Statement Book. II Errors and Corrections, Deposit Overdue Deb Diary Collection. Ledger. . Real Estate ( " Discount. " Trade Bills Discounted. u II Letters Despatched. Letters Received. •Mortgages Bank Premise Other Assets " Trade Bills Remitted. tl Overdue Debts and Procedure. Discount Blotter. l< Past Due Bills. Exchange Tables. u Produce. Interest on Account Current. H Securities Held and Powers of Journal. Attorney. Ledger Deposit. : ♦ :^ li Trade Bills Discounted. Ledger General. Signature Book. | Ledger Liability. Teller's Cash Book. I LedG;er Savings Bank. Teller^s Cash Statement Book. 1 We append the financial statement of two representative banks — one Canadian and the other American — which the reader can analyse with interest and profit. g of each it forty its iw secured utrency is :y between ited by the , the banks nally inter- rleans, La., N. Y., read the excep- \NK. ent Book. d. m Properties, tions, Deposit \d Procedure. id Powers of Lnted. 205 THE CANADIAN BANK OF COMMERCE. GENERAL STATEMENT, 30TH MAY. 1891. Liabilities. Notes of the Bank in circulation ,«; 2,525,065 00 Deposits not bearinR interest .52,851,451 16 Deposits bearing interest, including interest accrued to date - 12,319.977 96 15,171,429 12 Balances due to other Banks in Canada 4,177 70 Balances due to Foreign Correspondents 12,582 09 Balances due to Agents in Great Britain 514.685 22 Unclaimed Dividends 331 94 Dividend No. 48, payable 1st June 210,000 00 !iiii8,438,27i 07 Capital paid up ^6,000,000 00 Rest 900,000 00 Balance of Profit and Loss Account carried forward • • . 22,406 54 6,922,406 54 .$25,360,677 61 Assets. ■— i^^-^^— Specie $413,305 38 Dominion Notes 718,305 65 $1,131,611 03 Notes of and Chequeii on other Banks 703,768 53 Balances due by other Banks in Canada 128,742 91 Balances due by Agents of the Bank in the United States . . . . • 834,478 54 British and Canadian Government Securities, Municipal and other Stocks and Bonds 1,371,157 04 I Call and Short Loans on Stocks and Bonds 1,294,96248 $ 5,464.720 53 I Time Loans on Stocks and Bonds >. 336,487 30 Other current Loans and Discounts 17,508,511 77 [Bills Discounted Overdue, not specially secured (loss fully provided for) - - 59,395 69 lOverdue Debts, secured - - - - ^ ------ - 54.851 00 iReal Estate (other than Bank premises) 12.561 12 [Mortgages 221,961 63 iBank Premises and Furniture 641,843 25 lOther .Assets 60,345 32 $25,360,677 61 11 *" ■ ■ tmt -one Canadian id profit. 20« REPORT OF THE CONDITION OV THE MERCHANTS NATIONAL BANK. •In g«*! At St. Paul, in the State of Minnesota, at the close of business, September 25, 1891. Resources. Loans and discounts 93t423,6s5 17 Overdrafts, secured and unsecured 2,414 ^^ U. S. bonds to secure circulation 100,000 «) Stocks, securities, claims, etc. 235, 132 j8 Due from approved reserved agents 19502,940 13 Due from other national banks ....... 245,202 34 Due from state banks and bankers 67,693 36 8815,835 8j Banking house, furniture and fixtures $217,68092 Checks and other cash items $ 31,891 89 Exchanges for clearing house S3>854 89 Bills of other banks 12,74400 Fractional Paper currency, nickels and cents >|075 05 Specie 538,053 50 Legal-tender notes 24,497 00 $662,116 33 Redemption fund with U. S. Treasurer (5 per cent, of circulation) .... 4,50000 Due from U. S. Treasurer, other than 5 per cent, redemption fund • • . 1,750 00 Total $5,463,084 q6 Liabilities. Capital stock paid in .$1,000,00000 .Surplus fund - 500,000 00 Undivided profits . - - . 192,171 72 National bank notes outstanding 90,000 00 Individual deposits subject to check $1,278,12874 Demand certificates of deposit 560 00 Time certificates of deposit 825,55391 Certified checks 11,696 59 Cashier's checks outstanding 12,44640 Due to other national banks ' - 976,209 27 Due to state banks and bankers 576,31833 $3,680,913 24 ' Total $5,463,084 gf) 207 ,423.655 '7 2,4«4 33 100,000 CX) 2j5,>32 38 $815,835 83 $217,680 92 $662,116 33 4,500 00 1,750 00 $5,463,084 96 11,000,000 00 500,000 00 I92,'7i 72 90,000 00 $3,680,913 24 $5,463,084 gf" * Questions for Review. What is the chief business of a bank ? On what security are loans princi- pally made? Do they confine loans to their own capital? What are the loans callod ? What is the difference between bank discount and true discount ? Besides discounting commercial paper, what other business do banks do ? To what extent can banks issue paper currency ? Can banks issue notes less than the denomination of five dollars ? What power does the Government reserve respecting notes ? In getting payment from a bank what can you demand ? What per cent, of their reserves must the banks keep in Dominion notes ? Wherein do Canadian banks follow the British system ? What is meant by the term " The Banks " ? What is the liability of the shareholders in banks ? In whose interest does the double liability exist ? Can private individuals do a banking business ? Can private bankers issue paper currency ? What must private bankers avoid doinc; ? AMERICAN BANKING. When was the National Banking system of the United States created ? What was the principal object intended ? What security is there for the redemption of the currency of United States banks ? Can the individual States grant bank charters with I note-issuing powers ? Why is the power in disuse ? What feature of American Bank currency is regarded as a defect ? Do American banks have branches ? From I what does the term nacional come ? Is a separate Act of Congress necessary to establish an American bank? State how a National Bank is created. What per cent, in currency of the par value of the U. S. bonds deposited is issued to the banks? To what is the business of a National Bank confined ? How many reports I must the Bank make in the year to the Comptroller? CANADIAN BANKING. What does each bank in Canada possess, and from what source ? What are all Ithe chartered banks subject to ? What does capital authorized mean ? What does [capital subscribed mean ? What does capital paid up mean ? When did the existing JBank Act come into force ? Can Provincial Parliaments grant bank charters ? IWhat were the two chief faults in the previous Bank Act ? How much capital must pow be actually paid in before a new bank can commence business? What pangement exists by which the bills of all the banks now pass at par throughout the Dominion? What is the first charge upon the assets of a bank? What is the kecond ? What is the third ? What arrangements exist by which bill holders are Insured against loss in the case of a bank suspending ? What are the banks required lo do respecting unclaimed moneys ? Must all the directors of a bank be British lubjects ? What is the qualification of a director if the capital of a bank is a million Bollars ? What is it if the capital exceeds a million ? What is the penalty if a bank [ssigns or hypothecates its notes ? What reserve must a bank have before it can leclare a dividend exceeding eight per cent, per annum ? What provision is made I prevent gambling in stocks ? When does the liability of shareholders who have bid stock cease ? How often must proxies be renewed, and when recorded ? What |e the banks prohibited from doing? What may banks do beyond ordinary jiscounting ? Canadian banking is characterized as an excellent system ; state some [the reasons, from the point of view of (i) the shareholder, (2) the depositor, (3) (e borrower, (4) the bill holder. Analyse the financial statements of (i) The >0 • ■ J.A 208 i Canadian Bank of Commerce, (2) The Merchants National Bank of St. Pnil, Minnesota. DEALINGS WITH BANKS. An account may be opened with a bank by calling upon the Manager. Evidence as to integrity or reliability of character on the part of a stranger is required. If that is satisfactory, he will be requested to write his name in the signature-book in the style in which his checks will be signed. If the account is opened in the name of a firm, the signature of the firm is written by each member, and his own name opposite. This is for the purpose of comparison, should a check with a doubtful signature bo presented. The necessary blanks and bonks for keeping a bank account are furnished by the bank. The Deposit Slips are filled up by the depositsr, who, in addition to writing his name and the date, specifies the particular kind of funds deposited, according to the printed divisions of the Slip, and also writes the total amount deposited. The Slip should be handed in to the Teller along with the money deposited. These Slips enable the Teller not only to see at once if the money, as counted by him, agrees with the depositor's statement, but also to recall the transactions of the day, if necessary, in case of an error. BANK PASS BOOK. The entries made in the Bank Pass Book by the Ledger Keeper are the depositor's vouchers for all sums left with the bank, and therefore nothing should be written in this book by the depositor himself. When a note is left for collection a pass book may be handed with the note to the Bill Clerk, who will give a receipt for it, but the proceeds of the note will not be placed to the credit of the Depositor or entered in the Bank Pass Book until the note is collected. Notes that have been discounted and ordered to be placed to the credit of the depositor are entered in the Bank Pass Book, less the discount, to his credit, the same as a note that has been coUected. CHECKS OR CHEQUES. A Cheque is a bill of exchange drawn on a bank, payable on demand. The Check Book contains blank Checks, with a margin or stub for a description of the Checks as they are filled. (See page 214.) The account with the bank is sometimes kept in this book, on the back of the margins from which Checks have been taken, as shown in the form of Bank Account given in a subsequent part of the work, the difference between the total amount deposited and that withdrawn showing the balance in bank. At certain intervals, usually at the end of each month, the Bank Pass Book should be left at the bank that it may be balanced. The amount of the Checks that have been drawn are entered at these times ; and when the Banic Pass Book is returned, it should agree with the bank account kept by the dealer, if all Checks issued have been presented. No account need necessarily be kept in the Ledger, the balance being counted as so much Cash in hand, as it is subject to order at any time, and such account can contain nothing which may not be shown in tbe | Check Book. There are two methods for keeping the account with the bank in the Check Book I adopted by business houses ; that on page 213, in which the sums are added as soon I as deposited, and the amounts of the Checks are subtracted as they are drawn, which! 209 is best when the business is limited. According to the other system, the deposits are entered as they are made, but are only added when the account is balanced, which is done by adding the amounts of Checks drawn since the last balancing and taking the sum from the total deposited. This method is adopted in large houses, whose deposits and Checks are numerous. SuociESTiONS TO Drpositgrs.— A check drawn payable to a person, ''or bearer," is transferable without indorsement ; and unless there is good reason for withholding the money, the Check is payable to any one who may present it. A Check drawn payable to a person, " or order," must be indorsed by the person (called the payee) in whose favor it is drawn, before the bank will pay it. Don't indorse it until you present it for payment. Checks drawn in this form are safer for holding and for making remittances, as they cannot be used until indorsed by the proper person. When so indorsed, and held by the bank or drawer, they are evidences of the payment, and are therefore often used as receipts. When sent to a distance by the payee, indorse in full. Should the payee's name be mis-spelt, he will indorse as spelt, but underneath add his name properly spelt. The payment of a Check may be countermanded by the drawer of it any time before it is paid by the bank. A Check given by the drawer is not absolute payment ; and if there are no funds in the bank at the time it is given with which to meet it, it can be returned, and the Cash demanded. If a check is held beyond a reasonable time, and the bank or drawer should fail before it is presented, the holder must bear the loss. It must be presented in a reasonable time after it was received, or the holder retains it at his own risk. Every holder is liable to every subsequent holder only for a reasonable time. The inexperienced should pay particular attention to the following suggestions : Make your deposit as early in the day as convenient. Use the Deposit Slips furnished by the bank, and do not make deposits without your Bank Pass Book. All checks deposited (tl'.at are not certified) must be indorsed by the depositor, whether drawn payable to " bearer " or " order." To prevent their being used by other parties, stamp or write on all Checks sent or deposit the words " For Deposit " over your indorsement. Suggestions for Drawing Checks. — Avoid as much as possible giving Checks strangers, and make it an invariable rule to give Checks only out of your own 'heck Book ; and when not in use, keep it under lock and key. When giving a kck, write the particulars (always) on the stub first. Number your Checks onsecutively, and always date them. If you desire a Check to be a definite receipt, ly the dealer, it Braw it to the person or order, and state under the written amount what it is in be kept in the Biayment of; as the Check, when drawn thus, cannot be cashed without the person's ibject to order fcorsation, his signature will be an acknowledgment that he received the money, shown in theBnd of what it was received for. Blank Checks have usually the word "bearer" Irinted ; run your pen through the word, and write " order " over it. Write your le Check BookBgnature with your usual freedom, and always in the same style Never alter a added as soon ■heck received from any one ; alteration would make it void. drawn, which | St. V.uil, Evidence I. If that Dok in the name (it a e opposite, gnature bo e furnished iddition to deposited, (tal amount y deposited, counted by tions of the eper are the ig should be collection a I a receipt for Depositor or credit of the edit, the same nd. a description I the bank is Checks have ent part of the irawn showing h month, the he amount of hen the Bank i' I* ft? --l 210 At lenst once a month, and as frefiuently as occasion may re(]uire, send your Bank Pass Book to the Leduer keeper, that it may be balanced ; and ao soon as returned, check it with your own account. Deface the signatures of cancelled Chec ks, arrange them nccordin^; to their numbers, and place them in safe keeping, where tiny can be easily referred to. Before receiving back your Checks you will require to give a receipt for them, and acknowledge the correctness of the balance as shown in the Pass Book. Care should be taken in filling a Check to do it in such a manner that alterations cannot easily be made. Payment by the Bank of a forged Check if the forgery (an be proven, will be the loss of the bank ; but if the Check is filled so negligently as to invite or facilitate forgery, any loss that occurs will fall on the drawer. The amount of a Check should always be written out in words, and should also be placed in figures in one corner of the Check (care being taken to begin on the extreme left, and fill any space unused on the ri|jht by ruling), as a precaution against alterations, and that the sum may be readily seen when counting. Should the mistake occur of writing the sum in figures different from that expressed in words, the latter is taken as the sum of the Check. A Check that is intended to be paid in the future should be dated the day it is given, and should state in the body of the Check the day when it is to be paid. If dated in the future, circumstances may arise before the time of its date that will render it void. If the Check is not dated, the holder may insert a date. A Check is certified or marked '• good " by an officer of the bank, and the bank thereby becomes responsible for its payment, thus making it more reliable for third parties. Certified Checks are chiefly used to avoid the risk and incovenience of counting and carrying large sums of money that are to be immediately paid to others, When any blanks are needed to supply duplicate Checks, mention in the margin the purpose for which they are used, and take them from the back of the Check Book. Avoid drawing numerous small Checks. When you have several sums to pay draw one Check for the whole, and ask the Teller for auch denominations as will enable you to distribute the amount among those for whom the money is intended. Checks are a convenient method by which to remit money to a distance. In order that your Check may realize the amount you desire the party to receive, you must add the commission, which is generally }{ per cent. Example, when remitting | $ioo you must make the Check for $100.25. For some customers banks will mark Checks for remittance payable " at jjar," at the point the money is to be paid. Crossed Checks are those not intended to be negotiated. Two parallel transverse I lines are drawn across the face containing the word " bank" either with or without | the words " not negotiable." Certificates of Deposit are given by banks to those who deposit a special amount I for temporary safe-keeping and to bear interest. They may be drawn to the order of I the depositor, or to any other person whom he may designate. When a portion of| the deposit is withdrawn, the deposit receipt must be brought to the Bank. Drafts and Bills of Exchange for making remittances can be obtained from tbe| bank. !n quire to yive ihown in the at alterations B forgery (an ligently as to d should also begin on the lution against id the naistalie rds, the latter d the day it is o be paid. I( date that will , and the bank iable for third icoveniencc of paid to others. I in the margin Check Book, al sums to pay inations as will is intended. distance. In to receive, you when remitting )anks will mark je paid, rallel transverse with or without special amount to the order of len a portion of )ank. tained from the Notes and Bills for collection should be sent lo the bank a few days before they liccoine due, in order to give the bill-clerk ample time to make the proper record and send notices to the makers or acceptors. A Check that is drawn on a different bank from that in which the note is left for collection, unless certified, will not be received miKivmcnt for a Note in Hank. Notes taken to a bank to be discounted are presentad to the Manager, who Jocidts whether they shall be iliscounted 'ii not. In general. Notes that are not within three months of inaniritv are not discounted ; and there must be at least one name on the Note besides the ^nker, eitlier as rlrawer or indorscr. As a rule, banks discount only for depositors, and iIuto must be satisfactory security that the Notes discounted will be paid when due. either by their having sali§fnctory indorsers, or being accompanied by collaterals. m order to get a Note discounted at a bank it must be properly indorsed, and the residence of the drawer and endorser should be written on the Note in pencil. It is well to offer Notes at an early day that other sources may be applied to in case the Notes are refused by the bank. The chances for discount will usually depend upon the average amount kept on deposit, the reliability and standing of the names jun the Notes that are offered and the state of the money market Do not attempt to overdraw your account, and do not offer for discount Notes [that are not likely to be punctually paid at maturity ; and should any that have been iscounted be protested and returned to you, for your own credit pay them mmediately. In case a Draft or customer's Note is handed in to the bank for collection, and |ou entertain doubts of its being paid at maturity, and do not wish the extra cost of rotest charges incurred, pin a slip of paper to it with the memorandum, " Not to be ROTESTED. Tak.e THIS OKF HEFORK PRESENTING." The bank will follow your instructions, and, should the Note or Draft not be paid, you can get it from the bank It any time without paying charges. A Note indorsed requires to be presented at the proper time for payment, and, dishonored, it should be protested, and the indorser promptly notified, in order that e may be held for the amount. Sometimes, however, an arrangement is made etween the parlies, and the indorser writes on the back of the Note, " Notice of on-payment received without Protest," or, " Protest waived," or, " Presentation and rntest waived," and signs his name, after which he is held the same as though the ote had been protested. The form used by the Bank of INlontreal is, " Presentment, rotest, and Notice waived " See Index for Protests. The holder of a note is not bound to notify the maker of the date of maturity, id request him to make provision for payment ; but it is customary for firms to send ich a printed notice ten days or so before notes mature, so that careless customers 11 not have the excuse, " Oh, I forgot about it." The banks when necessary, for instance, when any doubt about the genuineness a signature exists, now notify makers and endorsers of notes which they have icounted, that they hold such paper. CLEARING HOUSE. Each day there accumulates in the banks, the currency and the notes and drafts other banks, and daily settlements must be made, in the absence of a Clearing use Association, these settlements would involve the labor and time of many clerks sing from bank to bank to make a separate settlement with each one. Where a aring House exists, the business of each day's settlements is conducted as follows : manager is appointed by each of the banks in turn (or he may be a permanent 212 •lb. c officer, appointed and paid by the associated banks), and every morning a clerk and a messenger from each bank attends at the Clearing House at lo o'clock, to deliver to and receive from each other the checks, drafts and notes which are payable by each to the other, these being made up in packages. At the same time a statement will be handed from each bank to the manager, showing the amount due by or to each bank, to or from each other bank. About noon the representatives of the different banks will pay to or receive from the Clearing House the amount in gold or legal tender so appearing due. The sum of the amounts owing to (say) the Clearing House will just equal the sum of the amounts owing by (say) the Clearing House, so that there is a perfect balancing of each day's business, hence the term ** clearing." Some idea of the convenience of the Clearing House can be formed from the f^tatement made by fevons regarding the London Clearing House. He says : " The average daily transactions in the London Bankers' Clearing House amount to about twenty millions of pounds sterling, wh'ch if paid in gold coin would weigh about 157 tons, and would require nearly eighty horses for conveyance." In Chicago on a day in August, 1893, the writer saw the clearings of the Banks, amounting to ten millions of dollars, effected in less than an hour. HOW THE NEW YORK CLEARING HOUSE ASSOCIATION AVERTED NATIONAL DISASTER. During the extraordinary financial depression that existed in the United States in the summer of 1893, the New York Clearing House Association rendered a service to that City, and indeed to the whole country, by which, it is safe to say, universal panic and disaster were averted. It was such a service as neither President nor| Congress nor any other body or association could have rendered. In the spring a j want of confidence was apparent throughout the United States, which was attributed by some to the compulsory purchase silver law, and the consequent over circulation of a silver dollar intrinsically worth about sixty cents ; by others it was attributed to I the uncertainty as to the future, consequent upon the recent change of administration, and the placing in power of the party pledged to cutting down the customs tariff and opposed to the policy of protection. As the year advanced there \vere numerous failures among merchants and manufacturers in all the States, and many banks were obliged to suspend. The financial storm had reached New York, currency had become scarce, and the banks were refusing drafts and checks of depositors. They were likewise finding difficulty in meeting their daily balances at the Clearing House, [ and while perfectly solvent must soon, had relief not come, have closed their doors. They had ample assets but could not realize upon them. To meet the emergency and save the banks of the metropolis from closing, and I the whole country from financial panic, the Clearing House Association conceived the plan of appointing a Loan Committee to which the authority was given to grant loan certificates, which were used among the banks belonging to the Clearing House I Association in lieu of money for the settlement of balances. The banks obtaining I these certificates deposited as security, bills receivable, stocks and bonds. Loan! certificates were issued to the amount of $40,000,000, and by the first of November,! when confidence had been to a large extent restored by the repeal of the silverl purchase law in a special session of Congress, the whole amount had been retired and| the Loan Committee wa^ discharged. The practical effect of the issue of the Clearing House Certificates was to createj a currency confined to the banks, which released for circulation during the crisisl among the people the ordinary currency to the extent of $40,000,000. It was a cool,f courageous, skilful and bus325 ;$486o 00 25 STUB. No. I. yan IS, 1894. Favor of Kobe It North, For Tweed. No. 2. Feb. 12, 1S94, Favor of Conger Bros., For Sugar. S175 50 5«5 so March 4, 1894. Favor of George Brown, Insurance. No. 4. A/894' or licnrer, lais, nith &= (-'■ ). 12, lS94. k, or IScuer, Smi(/i '^ Co. arch 4< '894- nU, or l^earer. C<'. EXPERT ACCOUNTING AND PRACTICAL MATTERS PERTAINING TO IT. One of the features of " The Canadian Accountant " which has given it popularity among practical business men, bankers and accountants, and which distinguishes it from the ordinary school or college text book on book-keeping, is the vast amount of practical office work and the every day information on business matters which it contains. In the present edition this element has received large and valuable additions, not only in the matter that follows here, but, as well, in many other portions of the book. WHAT TO DO WHEN TAKING CHARGE OF A SET OF BOOKS. When you take charge of a set of books, first test the cash and see that the cash on hand agrees with the cash balance in the cash book ; then ascertain whether the bills receivable on hand agree with the balance shown in that account in the ledger, and with the uncancelled bills in the bill book. If the books are kept on the double entry system, test by trial balance whether the ledger is in balance. S mil It April I, i«94- ink, or Hearer, mc^ Smitli >i~ ^''■ 1, April 10, iSn4 anu, OPENING LEDGERS UNDER VARIOUS CIRCUMSTANCES. JOURNALIZING RESOURCES AND LIABILITIES FOR SINGLE PROPRIETOR. When a single proprietor commences business, possessed of certain resources, [the journal entry necessary to open the Ledger is Sundries (the accounts representing each resource) Dr. To Stock (or the proprietor's name). If he has debts or liabilities, as well as resources they must be shown in the [Ledger also, consequently a journal entry would require to be made for them as Ifollows : — Stock (or the proprietor's name) Dr. To Sundries (the accounts representing each liability). When the foregoing entries have been posted to the Ledger, you will show on Ithe Dr. side each resource under its own title, and on the Cr. side each liability, and In the stock account the net capital. llOURNALIZINC; resources AND LIAISILITIES AT THE FORMATION OF A PARTNERSHIP TO OPEN THE ACCOUNTS. When two or more partners come together for the first time, each bringing in [esources and liabilities, you will make the resources which each brings in Dr. to his papital acct., and make each one's Capital acct, Dr. to his liabilities. For example : — Orckt, ! rs. itttcs Smith >> t'r. teamt.inwlucU. 1 ..jrer is prnUfil. ri")| Cash Dr. 1 150000 Bills Receivable " 750.00 Real Estate " 1000.00 To J. W. Neal Cap. acct. $3250.00 Eftects invested. J. \V. Neal Cap. acct. Dr. 900.00 To J. Runciman 150.00 •* Bills Payable 750.00 His liabilities assumed by the partnership. 216 !| Ca.sh Dr. $2000.00 Merchandise " lono.oo M. MacCormick " 89.00 To John L. Kerr Cap. acct. !j3o89.oo Effects invested. John L. Kerr Cap. acct. 7'>r. 425.00 To Bills Payable 250.00 " Andrew Shaw 175.00 His liabilities assumed by the paitnership. Note. — If no day book entry lias l)ecn made, full e.vplnnations should accompay each entry in the journal. The resources and liabilities of each, now become the resources and liabilities of the partnership ; the individual partner's accounts showing each one's capital or insolvency. A partnership cannot have an account with itself. JOURNALIZING TO OPEN NEW ACCOUNTS FOR A PREVIOUSLY EXISTING PARTNERSHIP. An accountant is frecjuently called upon to open a new set of accounts for a previously existing partnership. The data from which it is to be done will be a balance sheet or statement, showing the firm's resources and liabilities, and the] amount of the capital or insolvency of each partner. The student will observe that it would not be possible to journalize in this case, | as is done when partners come together for the first time, because you cannot say I that any particular resource or liability is that of any one partner. We suggest either | of the following methods : Sundries JDr. to Sundries. {Resources.) Cash • • • , . . . • $ 570 20 Merchandise .... • > > • . . • • 4220.00 Bills Receivable • • • . . . ■ • 1500.00 John Macoun 78.20 J. VV. London • • • • • • • • 57.50 R. A. Van Allan {Liabilities.^ 125.90 ) 6551.80 To Bills Payable '• J. H. Watlington " F. Macaulay " loseph ElUiott " (Partner) las. Johnson, Capital " (Partner) VV. H. Fuller, " $1570.00 340.00 170.00 58.50 2138.50 2IOO.OO 2313-30 Note. — When posting, debit each Resource To Sundries, and credit each Liability By Sundries. The sum of the Assets equals the sum of the Liabilities and Capital, or the Liabilities to the public and the proprieiorj ANOTHER METHOD. Sundries Dr. to Capital $6551.80. {Resources.) Cash . $ 570.20 Merchandise 4220.00 Bills Receivable .... 150000 John. Macoun ... 78.20 J.W.London 57«So R. A. Van Allan 125.90 expenses, and J. W. and the lal ••Account w for amoun If the I of the year he should TRA When Call the oI( Ij"! the credl [lie account] Ledger B, 'boldhan( ['lose that c| N on the |fom LedgeJ l«t time to] r'" then onj "d open ne lansferring 217 nal. i liabilities of e's capital or ISTING accounts for a lone will be a ilities, and the I ize in this case, ycu cannot say I e suggest either Capital Dr. to Sundries 6551.80 {Liabilities.) Bills Payable J. H. Watlington F. Macaulay . . . Joseph Elliott, $1570.00 340.03 170.00 58.50 «2i38.so 2100.00 (Partner) Jas. Johnson, Capital. . . . (Partner) W. H. Fuller, " .... 2313.30 XiviE.— If preferred, Capital might be made Dr. to the partners in a separate entry. When either of the above entries has been posted to the Ledger you will show on the Dr. side each resource under its own title, on the Cr. side each liability, and on the Cr. side of each partner's account the amount of his capital. You will observe that the " Capital Account " is simply used as a medium through which the other accounts are opened. Suppose that some time after the books were opened you found an additional asset that had not been taken in. It is a note that was overlooked, make Biiiii Receivable, To Jas. Johnson's Capital Account. '• W. H. Fuller's " Suppose that a liability had been overlooked ; it is a debt owing to James Ross & Co., make Jas. Johnson's Capital Account, W. H. Fuller's " To James Ross & Co. PROPRIETOR'S OR PARTNER'S CAPITAL ACCOUNT, AND PARTNER'S CURRENT (OR PRIVATE) ACCOUNT. It is often desirable to keep the Capital Account of a proprietor or partners distinct from the account showing their withdrawals for family and other personal expenses, or against salary. In that case open, say, ]. W. Johnson's Capital Account and J. W. Johnson's Current (or Private) Account. The former will show the capital and the latter the withdrawals. At the end of the business year close the Current .\ccount with this journal entry : 0'. W. Johnson's Capital Account Dr. To J. W. Johnson's Current Account. For amount withdrawn during the year transferred. If the proprietors are allowed a certain salary, then credit this account at the end lofthe year, by Salary or Expense; and if the individual has overdrawn his account, Ihe should pay back the overdraft in cash, which would be passed to his credit. ublicandtheproprieiol TRANSFERRING ACCOUNTS FROM AN OLD LEDGER TO A NEW ONE. When transferring accounts from an old Ledger to a new one, proceed as follows ; Call the old Ledger, Ledger A, and in the accounts which show a debit balance write Ion the credit side. By Balance to Ledger B, Folio, — , and rule and foot it ; and in [he accounts which show a credit balance, write on the debtor side. To Balance to Ledger B, Folio — , and rule and foot it. Call the new Ledger, Ledger B ; write in I bold hand the names of the accounts as you transfer them ; on the debtor side of |hose that closed in Ledger A, By Balance, write To Balance from Ledger A, Folio — ; nd on the credit side of those that closed in Ledger A, To Balance, write By Balance lorn Ledger A, Folio — . Immediately after transferring an account index it. The %X time to make such a transfer is when the annual closi .g time comes round ; you lill then only require to transfer the Resources and Liabilities and Partners' accounts, Jnd open new representative accounts as required. There is very little more labor in psferring balances to a new Ledger than bringing them down in the old one. Kit « ^ki c :«S4, 218 MARKING COST AND RETAIL PRICE ON GOODS. In such a business as Dry Goods and Hardware the Cast price, as well as the retail price, should be marked on each piece of goods, The principal object in view in marking the cost price is, that when an Inventory of Stock is being taken you may know what each piece of goods cost. Somie merchants mark the retail price in r^lain figures and the cost in letters ; others mark the former in letters and the latter in characters. The following will illustrate the method of marking goods : 1 2 3 COST MARK. 8 9 10 11 12 cipher, repeater, adds ten. uox'-v^vcn cnz/JzH^ e — RETAIL MARK. 1234. 5 678 9 10 cipher, repeater, dontgiveup x z EXAMPLE. Suppose goods cost $6 a dozen, and you intend to retail them at an advance of 50 per cent., mark the cost by the character representing 6 (which is V), and follow it with the character representing the cipher, and follow this with the repeater ; then mark the retail price for the single article directly under the cost, in this case the price would be 75c., which would be written .vg. Then the goods would be marked thus: v.xe •V To sell at an advance of 50% over the cost price does not mean a profit of 50':^ but a profit of 33^^%. In the above example the goods cost $6.00, you sell at $9.00 which is 50% advance, but of the $9.00 that you receive only $3.00 is profit, or Yi. TRADE AND CASH DISCOUNTS. A Trade discount is a discount off a nominal list price, as, for instance, hardware manufacturers quote the prices of some goods at, say, $9.00 a dozen and 21; I per cent, off; the real price being $6.75. When they desire to raise the price ofl particular lines of goods they don't alter the list or nominal price, but lower thej discount ; and if they desire to lower the price they raise liu ••iscount. See form oil invoice, page 57. Sometimes discounts such as 10 and 10 and 5 are allowed. This| it will be seen, is less than 25 per cent, off the face of the invoice. A CASH DISCOUNT is an allowance made for the prompt payment of goods,! (called spot cash), instead of a term of credit being taken. It will be well to bearinj mind that when paying duty on importations, the Customs authorities will not alloff| any deduction of duty from the face of an invoice for Cash discounts. 219 veil as the ect in view n you may t in letters ; lowing will DETECTING ERRORS IN TRIAL BALANCES. By care in posting, and by a/ways adding both up and down, when making additions, a book-keeper will avoid errors. The most careful person, however, will occasionally find his ledger out of balance. If every addition had been verified by adding both up and down, one may safely conclude that the error or errors cannot be in the additions, and this knowledge gives confidence that the mistakes will soon be found by checking the postings. By experience we have found the following method of adding the best : ;r. adds ten. Iter. an advance of y and follow ii ;peater ; then this case the uld be marked profit of 50;;, 00, you sell at ] $.•^.00 is profit, 594327 830560 734251 953872 642501 724956 302416 38 V 22 J 28^/ 47 v^ 23 ^/ The result of the addition of each line is set down, so 28 J that if the adder is disturbed, or if he finds a mistake when checking down, say in the fifth row of figures, he only requires to add that one line again, instead of all the lines from the first. The J mark shows the verification, /. e., that each line has been added twice. The result of the addition in the example is 4782883. Faint blue lines ruled in the Ledger between the red lines of the dollar column will prevent units being placed under tens, tens under hundreds, and so on, and much trouble be thereby avoided. The same precaution in ruling shonld be taken with the trial balance. In the majority of offices a trial balance of the Ledger is taken monthly, or at least every three months. To the novice in book-keeping the work involved in taking a trial balance of a Ledger containing from five hundred to a thousand accounts, twelve times in the year, would be appalling. It would be a laborious task, even for the man of long experience and habitual accuracy, if there were no labor-saving methods. Trial Balance Books, ruled and arranged so that the names of the accounts have only to be written once in the year, and having twelve separate columns, one for each month, can be obtained from any first class stationer. Refer to page 116 for an example of a Monthly Trial Balance Book, which shows balances for three separate months. The opposite page would contain three months more, and if each alternate sheet in the book be left untouched as you proceed, and a piece cut down on the right the width of the space that the names of the accounts occupy, you have simply to continue the balances for the last six months on these. Books containing this simple device are patented in Canada and the United States. Taking a trial balance each month in this way, if a ledger is found out of balance, a month's checking is a comparatively trifling labor. Think for a moment of the difference between it and the work involved in checking eleven or twelve months' posting. Many suggestions are made in regard to locating mistakes or detecting errors ; b of them amount to anything. Perfect accuracy in addition by the method we ave mentioned, leaves the book-keeper, in the event of the ledger being out of alance, just one thing to do, namely, to check back the postings. This must be of eoods,B'°"^ systematically. Take each book in turn from which the postings to the Ledger ^^ U to bear inW^'e made, and check each entry, placing a J mark against each separate entry in •^ 'll ot allowfr book posted from and the one posted to. Do this with a hard black lead pencil, ^^^ ^ot in the column with the figures, but just on the red line between the figure column iS for instance, a dozen and 25 aise the price of but lower the Bit. See form of allowed. This, 220 <«ki tind the folio column. The marks made by a hard lead pencil can be easily erased, if this is desirable. If they are allowed to remain, being out of the figure column, they will cause no confusion or slovenliness You should soon discover the errors by this process. Should they not be found, cast your eyes carefully down the columns of each ledger account, and if you find an entry without a check mark, then you have discovered an entry that has been by mistake posted twice. Omitting the clieck marks this would not have been so easily found. ON THE CORRECTION OF ERRORS. In correcting errors in the regular books, it is not sufficient to make matters come out right by writing " To error," or " By error," as you are directed to do in the old school treatises. You must make the correction explain itself by a distinct refer- ence to where the error exists, and at the place where the error is made note the date and place of correction. Thus, if you have journalized any entry wrongly, and liave discovered it before posting, write on the margin of the entry, " Void, corrected Page — ," and preface your new entry with, " To rectify error, page — ." For obvious reasons there are very strong objections to erasing either figures or writing on any book of original entry ; but if a post be made to a wrong account or to the wrong side of an account in the Ledger, if the account is not footed, there can be no great objection to erasing the figures in the money column and replacing them with ciphers, allowing the date and other words of the entry to remain. Let the amount then be correctly posted. No person of taste ever thinks of scoring out entries in his Ledger j for the purpose of rectifying them or for any other purpose. R with ar in com against Bo( of Justic For witnesses The law knoivn, a: saved hac Abo and of vvc redness, made the i absence or To en facts must Tst. ; 2nd. roper cust( 4th. ho have d( If the mid be re( ENTE CRO.SS ENTRIES. Cross entries are made for the purpose of rectifying mistakes. Where there is a " snarl " or complication in an account, caused by several mistakes, it is usually necessary to make several cross entries to " straighten " it. We give below examples^'^'^^^^d pro of simple cross entries. If Wm. Green purchased goods on credit, and by mistake in Journalizing or posting you charged them to Jas. Brown, the cross entry in the journal to rectify the error would be : JVm. Green, Dr. To fas. Brown, For Goods charged the latter in error, Sept. 29th. Again, suppose that when journalizing the entries of the IV Set you had made| the following errors and posted them to the ledger : On the 8th credited Bills Receiv- able with both the amount of Jones' note and interest, $296.65 ; on the i6th chargei Bills Payable with both the amount of Jakes & Hayes' note and interest, $1914.94 to rectify them you would make the following cross entries : For that on the 8th Bills Receivable Dr. 1.65 To Interest, 1.65 For error in crediting B. R. with an item of interest, April 8th. For that on the i6th, Interest Dr. 14-94 To Bills Payable, 14 94 For error in charging B. P. $14.94 Interest on April i6th. Vour joui , Kills Payabll Interest, For B. P Mc Accepted thJ isily CTased, ure column, he errors by the columns ,en you have P the check nake matters i to do in the distinct refer- note ibe date rly, and liave 0, CORRECTED ' For obvious writing on any to the wrong an be no great m with ciphers, .mount then be ;s in his Ledger 221 Remember that Bills Payable account is never charged with more in connection with any bill than it was credited with, and Bills Receivable account is never credited in connection with any bill with more than it was charged with. Interest for or against must be put through Interest Account. here there is a I js, it is usually! below examples I Journalizing oil ial to rectify the! let you bad tnadel \ted Bills Receivj the 1 6th charged terest, $i9'4-')4l It on the 8th 65 il 8th. BOOKS AS EVIDENCE IN COURT. Books of Original Entries are the only ones admitted as evidence in Courts of Justice. For proving many transactions there is no written signature nor testimony of witnesses, and the entries in the books are the only vouchers for millions of dollars. The law has laid down certain rules in regard to them, which should be universally knoivn, as debts are frequently lost from some defect of entry, which might have been saved had they been recorded in a proper manner. A book of Original Entries is evidence of the Sale and Delivery of goods land of work done. The book, however, may be set aside on sufficient proof of incor- rectness. It must be proved by the affidavit or oral evidence of the person who made the entries, or if such person be dead or cannot be reached, proof of death or |absence or of the hand-writing is sufficient. To entitle a person's books to be received as evidence in Court, the following liacts must be proved, viz.: rst. By whom the entries were made. 2nd. That the books produced are his account books, and come from the proper custody. 3rd. That some of the articles charged have been delivered. 4th. That he keeps fair and honest accounts, and this he must show by those nho have dealt and settled with him. If the entries in a book were made by a clerk, and he be dead, on showing that Jact and proving his hand-writing, and that he was a clerk of the party, such entries Ifould be received as evidence. ENTRIES FOR RENEWALS OF NOTES AND ACCEPTANCES. Suppose M. MacCormick & Co., of Belleville, have a note for $200, m favor of JlcLachlan Bros. & Co., of Montreal, coming due at the Merchants' Bank in Mont- lal four days hence, which they cannot meet, they request the house to retire it, and jnew, say, for three months ; the request is granted, and the first or second day after je maturity of the note they receive the following statement : 1894 (Tlie Usual Heading.) Jan. 25 — To Cash 10 retire your note. $200.00 " Interest on renewal for three months and Bank Com. 5.09 Cr. By Draft at three months, McLachlan Bros. & Co. §205.09 $205.09 94 1 6th. Your journal entries for above will be : Bills Payable, Dr. $200.00 I Interest, " 5-09 To McLachlan Bros. & Co., $205.09 1 For B.P. No. 58, retired by them, and renewed for three months, as per statement. McLachlan Bros. & Co. Dr. $205,09 To Bills Payable. $205.09 I Accepted their Draft at 3 months from Jan. 25, in renewal of B. P., No. 58. • 222 mmf Or, if you don't desire to put the transaction through the personal account, the following Journal entry will have the same effect, and be much shorter : Bills Payable, Dr. (200.00 Interest, " 5.09 To Bill Payable, $205.09 The entries of the firm that renewed the note would be, if the note were under discount and retired by Check : In til Dr. •205.09 i$200.00 5,09 M. MacCormick <\: Co., * To Bank, " Interest, For their Note due this day (B. R., No. 120) retired by Check, No. 170, renewed for three months. Bills Receivable, Dr. 9205.09 To M. MacCormick & Co. 9205 09 For Draft at three months in renewal of B. K., No. 120. Or, if you don't desire to put the transaction through the personal account (after charging back the note to Bills K,ec. and crediting Bank), the following Journal entry will have the same effect, and be much shorter : Bills Receivable, Dr. $205.09 To Bills Receivable, $200.00 " Interest, 5.09 o PARTIAL RENEWALS. Brown renews for you half the amount of a note for $500, due to-day. You pay $250 cash, and give a new note for half the amt. of the old one and interest on renewal, $3 50. Brown renews for you half the amount of a note for $600 due to-day. You pay $303, being half the amount, plus the interest on renewal, and you give a new note for half the amount of the old one. 1. Your Entky. Bills Payable Dr. $500.00 Interest, 3.50 To Cash, 25o,c " Bills Payable, ^53,501 2. iTis Entry, Bills Receivable Dr. $253.50 Cash *• 250.00 To Bills Receivable, 5oo,c " Interest, j.j| 3. Your Entry, Bills Payable Dt. $600.00 Interest " 3.00 To Cash, 30J.0 " Bills Payable, 300,0 4. His Entry. i Bills Receivable Dr. $300.00 Cash " 303. CO To Bills Receivable, 6oo,(| " Interest, i\ - •• * If the note were not discounted^ as in the example in Set V., McLachlan Bros. & Co.'s first entry A-ouldbtl MacCormick & Co. Dr. To Bills Receivable and Interest. Suppose that instead of the note being due in MonlrtJ were due in Belleville, M. MacCormick & Co. would request permission from McLachlan Bros. & Co., s.iy fourq before it matured, to draw upon them, at sight, for the amount required ; and having obtained written permission, v present it with the Draft to one of the Banks (most probably the Bank at which it is payable), and obtain the anioni^ the Draft, for which they would debit cash and credit McLachlan Bros. & Co. (the fifty cents paid for collection woulil credited to cash and charged to Interest), and when the statement is received they will credit McL. Bros, & Co. uillil interest, &c., on renewal. At the maturity of the Note they would pay it, and, of course, credit Cash by Bills Payil Vo that thei in the re Johi day, amc acceptant $64 00, tl John Bil fnl ffe The Bill The el I be as follof John BiliJ Inte and! Heri The Joht and Bills! Charle.«| |':wunt$i, ""j. which I count, ihe vvere v\ndet 223 When a Cash Book is kept, of course the cash would ive to ''ht put through it. In that case the entries for No. i would be as follows :— Cash Cr. By Dills Payable, For part payment on No. 9a |a^ ""oo renewed as per Journal and Bill Book. Bills Payable Dr. 9250.00 Interest " 3.50 To Bills Payable, $253.50 On the same principle work the other examples for yourself. account (after Journal entry $500.00 3-5° «253-5o 250.00 $600.00 3.00 250,0 500,0 $300.00 303.00 h< 303,0 300,0 600,1 400.00 7.00 64 00 471.00 471.00 400.00 7.00 64.00 *••='! Co, avf""' RENEWALS, INCLUDING OTHER ITEMS. You will often find when a customer asks for a renewal of his note or acceptance, that there are items charged to his personal account which it will be well to embrace in the renewal. Following are some examples. John Jones' note (or acceptance) in favor of the Herald Printing Co., is due to- day, amount $400.00. The renewal is to be for three months and the new note (or acceptance) is to include the sum of the old one, interest on renewal $7.00, and $64 00, the amount at the debit of the personal account. John Jones' entry would be ; Bills Payable . . • - Dr. Interest ......>« ^iscoum| tnc same. 996 o.oo o.oo DO.CX) ;ouNr. ale, it may bi; . The l):ir.'r. $796.60 2.00 $186.00 264.00 180.00 1 68. 60 Or in the Cash Book : Dr. CASH. Cr. To John Simpson & Co., Draft Coll. '• R. J. Wood, " •• '• T. Brown, " " " B. G. Ross, " " $186.00 By Bank Proceeds of Collections, $796.60 264.00 " Discount Exchange on above, 2 00 180.00 168.60 • TO SHOW SETTLEMENTS IN LEDGER ACCOUNTS. WITHOUT RULING. It is a great assistance to a bookkeeper to pursue a method of showing clearly the various settlements in the course of a year, and the settled items of a large, or even a small, account in the ledger ; but it is not desirable to ru/e an account oftener than the ledger is balanced. We therefore recommend the plan shown in the example below. Dr. R. B. BEATTY. Cr. 1894 1894 Tan. 2 To Mdse., 49 A 197 50 Feb. I By Bills Rec, 70 A 436 70 I") t( (i 64 A 239 20 April I (( t( lOI B 749 90 Feb. 17 *' Cash, 120 100 00 May 10 i< li 170 c 57 SO Mar. 7 21 " Mdse., 84 91 B 597 B ii;2 20 70 April 3 4( 11 102 c 57 50 May 10 29 (1 l( 120 '25 143 49 .;o >5 The letters of the alphabet are used consecutively, and should always be in lead pencil — a hard black that will not blur is the best. Vou will note that the debits in January are settled by note in February, and the settlement is indicated by the letter A opposite each debit and the credit. The March and April debits are also settled, and the letters B and C on each side show the respective settlements. Suppose that on the I St of June, when making out statements, you come to this account, you see at a glance the unsettled items. We have found in long, complicated accounts that this system of showing settlements is exceedingly valuable. In practice we have also used it in the Bills Receivable and Bills Payable accounts, to show notes retired, each bill, of course, being posted singly. WORKING ACCOUNT. This account is practically the same as a Loss and Gain account, and would be used to close the representative accounts in a ledger, say, of a public institution. Take a church, for instance. It is desirable to show income and expenditure under such Ledger titles as the following : Collections, Pew Rent, Missionary Fund, etc , for income ; and Lighting, Sexton, Organ Expenses, etc., for expenditure. At the 229 have been 56.0O )4.oo Jo.oo 38.60 c'ose of the year, instead of closing these accounts into Loss and Gain, as would be done where trade is being carried on, you would close them into Working Account, and it would show either excess of income or expenditure, and be closed into the "Church " account, which i , the one that keeps the Ledger in balance, or represents the net worth or insolvency, as does the Stock account of an individual. For a more extended explanation and illustration of Working Accounts, see " Johnson's Joint Stock Company Bookkeeping." IS, §79i).6o 2,00 s. owing clearly )f a large, or count oftener n the example Cr. ays be in lead the debits in d by the letter re also settled, Suppose that :ount, you see accounts that ; we have also ;s retired, each PRIVATE LEDGER. All judicious merchants are aware of the importance of avoiding needless exposure of their affairs. This in some establishments is unavoidable, where the partner's accounts and the results of the business are all exhibited on the same ledger. In order to avoid exposure, a Ledger, with clasp and lock, may be kept for accounts that are to be kept private. The keeping of these accounts in a separate book entails no additional trouble, as they are dealt with as though they were in the General Ledger. Some merchants, who adopt the plan of keeping a Private Ledger, also make the opening entry ot the business upon a Private Journal. We have not deemed it necessary to give an illustration of this Ledger, as the mode of keeping it will be apparent to any person who understands the science of accounts. We may mention, however, that the accounts usually kept in it are Merchandise, Loss and Gain, and the proprietors. A 436 7° 1 B 749 90 ■ c 57 CONTINGENT ACCOUNT OR SUSPENSE ACCOUNT. It frequently occurs at the close of a year that losses or charges are imminent, the exact amount of which cannot be ascertained. It is desirable under such circum- stances to carry such a sum from the Loss and Gain Account of the year to the credit of Contingent Account as will be equivalent to these possible losses or charges, and into which they can be written off in the future, By this plan, the year properly chargeable shows the loss, and provision is made to meet it by retaining a sum that would otherwise likely be withdrawn as profit. Suppose this to have been done, and there stands at the credit of Contingent Account the sum of $500. The loss may be from depreciation in plant, and is now ascertained, make Contingent Account Dr. To Plant Account. It may be from bad debts, make Contingent Account Dt. 'lo the several Personal Accounts., or perhaps to Bills Receivable. It may be the costs of a law suit, make Contingent Account Dr. To Cash. 'A M and would be lie institution. enditure under ry Fund, etc., ■iture. At the COMPROMISE WITH DEBTORS. The accountant has frequently to deal with compromises made between debtors land their creditors. Wholesale houses have to make settlements of this kind more Irequently than is pleasant, and require almost constantly a " Compromise " account In their ledger. It is kept to show the losses from this source, just as " Bad Debts " •230 account is employed to show the losses from debts totally bad. For illustration, John Blank & Co. have suspended or gone into bankruptcy ; a meeting of their creditors has been held, and their offer of sixty cents on the dollar has been accepted. Their debt to us amounts to $3000 made up of bills receivable $2500 and personal account $500. We deliver up the old notes In settlement of the compromise we reciive new notes drawn at 6, 9 and 12 months for $1800. Make the following entries ; Compromise account Dr $3000.00 To Bills Receivable ... John Blank & Co $2500.00 500.00 AND Bills Receivable Dr $1800.00 To Compromise Account $1800.00 At the end of the year, Compromise account will close By Loss and Gain for the amount of your loss $1200. The entries to be made by John Blank & Co., for the same transactions are : Bills Payable Dr $2500.00 Student Dr 500.00 To Compromise Account $3000.00 AND Compromise Account Dr $1800.00 To Bills Payable $i8on.oo .•\t the end of the year, Compromise account will close To Loss and Gain for tlie gain made on the compromise It will be seen that the effect of the above entries when posted is, first, to cancel the old notes and the personal account in the ledger ; and second, to show the amount | of compromised debts at the credit of Bills Payable account, note? being given cover- ing the compromise. Compromise account will close to Loss and Gain at the end of| the year. The firm that effected the compromise would require to make similar entries for| each creditor, but one journal entry would do for all, for example : A man fails owing $2o,coo — $19,000 in notes and acceptances, and $rooo on personal accounts, andl compromises at 60 cents on the dollar, and gives in settlement notes at 6, 9 and u\ months ; following are the entries : — Bills Payable, Dr $19,000.00 Give in detail the notes : — C. Jones & Co 200.00 R. Brown & Sons 620.00 Thos. Dunn & Co 100.00 Times Printing Co 80.00 To Compromise Account $20,000.00 "AND Compromise Account Dr 20,000.00 To Bills Payable $12,000.00 " Loss & Gain 8,ooo.co 231 ration, John eir creditors )ted. Their jnal account ; we recxive entries : oo.oo jOO.OO Boo.oo i Gain for the ctions are 3000.00 1800.00 nd Gain for tlie first, to cancel i how the amount j ing given cover- ] ,in at the end o( milar entries for man fails owing il accounts, and s at 6, 9 and 1; $20,000.00 $12,000.00 8,ooo.co DUTIES ON GOODS. The expenses of running the Government are largely met by the revenue derived from duties imposed upon goods imported from other countries. These-duties are collected by the Customs Department, through the various Custom Houses scattered throughout the Dominion. The customs tariff is created by Parliament, and is changed from session to session. The existing tariff of any year may be bought from or ordered through any stationer. There are two methods of imposing duties, namely, ad valorem and specific ; the first is according to the value of the article as shown in the invoice, or as appraised by the customs officers ; the other is upon the quantity, /. e., so much upon the measurement or weight, irrespective of the value. Some goods are taxed both an ad valorem and specific duly. When ordering goods from a foreign country, ask tor the invoice in duplicate, and that it be certified correct by the exporter ; the law requires this. The original invoice must be left at the Custom House when passing the entry for the goods. You speak of goods as being in bond until the entry has been passed at the Custom House, tie duty paid and the goods examined. The forms used in passing entries give the name of the importer, the transportation route, the place of purchase, the description of the goods, quantity and value, the marks and numbers on the packages, the rate and amount of duty. On the back an affidavit is made that the invoices produced are not fradulent, and that nothing has been done or concealed by which the Government could be defrauded. The forms are made in duplicate, one being forwaded to Ottawa. From the forms the department makes up yearly the quantities of goods imported into the Dominion. The importer may either pass his own entries, or employ a broker, who will act for him under power of attorney. Any one may act as a Customs broker ; the position is not an appointment of the Govern- ment, it is self-constituted. Many importers have bonded warehouses on their own premises, in which i;oods are stored, and remain in the custody of the Custom House officers until such time as I the owner may desire to take them out of bond and pay the duty. For this privilege 1 a license must be obtained from the Government and an annual fee paid. Over such I warehouses the sign V. R., Bonded Warehouse, No. is placed. An examining warehouse is an adjunct of the Custom House, where goods are sent on arrival for I examination. In Canada, Consuls' certificates are not required at the Custom House when I passing entries ; but in the United States they are. When exporting goods to the United States the exporter must obtain from the United States (>onsul of the district a certificate, which must be produced at the American Custom House when entering the goods. The certificate costs $2.50, or, if the Consul makes it out, $300. From I the fees the Consul's salary is paid. The peculiarity of this arrangement is that the I United States Government maintains its Canadian consular service at the expense of [Canadian exporters. The amounts paid for duties are charged to Merchandise Account, because the Iduty is part of the cost. On the same principle the sums paid for freight and cartage Imay be charged to Merchandise Account. It is usual, however, to keep a Freight [Account and close it at the end of the year either into Merchandise, or Loss and IGain. 232 There is an Excise Duty on some articles manufactured within the Dominion, collected by the Inland Revenue Department of the Government, through the Inlund Revenue Ofifices scattered throughout the country. The articles manufactured in bond, and which pay an excise duty are, all kinds of spirits and tobacco, petroleum oil, and vinegar. Up to a few years ago stamp duties were imposed upon promissory notes and bills of exchange. Those have been entirely abolished. BOOKKEEPING FOR BRANCH STORES AND AGENTS. BRANCH STORES, The best way to beep accounts with branches is to treat them just as you would personal accounts. For example, you have a branch of your business in Kingston, Ont. You send goods to it from the main establishment in Belleville, and you also buy for it direct. For the goods sent from the Belleville stock, you will make Kingston Branch Dr. To Mdse. for the actual cost, including freight or other charges, as shown on the invoice you will send. For the goods bought for the branch (either by it or you) and shipped to it | direct by the firm from which they were purchased, you will make Kingston Branch Di. To the firm from whom purchased. It is understood, of course, that the Belleville house is to settle with the firm I from which the goods were bought, and it will receive the invoice, a copy of which | will be sent to the branch. As we charge the Branch with any value we send to it, or cause to be sent, so we) credit it with any value received from it. We will receive remittances by bank draft | from it at stated periods ; for these we make Cash Dr. To Kingston Branch, Or if notes, Bills Rec. Dr. To Kingston Branch. We will receive goods from it occasionally ; for these make Mdse. Dr. To Kingston Branch, The Branch will keep its own regular set of double entry books, and submit its! balance sheet yearly to the main house. For the net gain shown at the end of eachj year you will make Kingston Branch Dr. To Loss and Gain, Or, if it should unfortunately show a loss, make Loss and Gain Dr. To Kingston Branch. When this has been done, the amount brought down on the debit side of yourl ledger account with the branch, will be your net investment in the branch, and wii agree with the amount brought down on the credit side of your account in thef Branch's ledger, showing the amount of your capital therein invested. In the I'ry, there settlemc in conse( Any inte fstrations, When cc following How mu l«t is the sent liabilii 233 » Dominion, h the Inl;ind lufactureil in o, petroleum n promissory TS. as you would in Kingston, , and you also 1 make he invoice you I shipped to it I DEALINO WITH AGENTS. If the dealings with agents be confined to cash transactions, make the Agent at Dr. To Cash for money entrusted to him direct by you. Require him to keep a cash book, showing cash received from all sources, and the amounts paid out ; and send in a debit and credit statement of cash in detail, or i under summarized headings at regular intervals. For cash accompanying the statement received from him make Cash Dr. To Agent at I and journalize the balance of the items on the statement as follows : Agent ot Dr. land then make To the accounts representing the various sources form which he rereived cash. The various accounts for which he made disbursements Dr. To Agent at with the firm [copy of which :o be sent, so we I IS by bank draft I'he amount at his debit in your ledger will correspond with his balance of cash on liand. If Merchandise as well as Cash enters into yoi.r dealing with an agent, make him Dr. to Mdse. or Cash as you entrust him with them. Make Mdse. or Cash Dr. lo him as you receive these from him. If he sells goods on account, with your Janction, make the parties (or Bills Receivable if he takes notes and turns them over I you) debtor to him. For the expenses you allow him, or the salary, or the com- mission, make the account debtor to him. In order that your dealings with him, and lis dealings with others for you, shall be intelligently recorded in your books, require lim to furnish statements at regular intervals. « '1. M 30 and submit its! the end of eacV HOW TO ARRIVE AT A JUST SETTLEMENT OF PARTNER'S ACCOUNTS WHERE BOOKS HAVE NOT BEEN KEPT BY DOUBLE ENTRY. In the dissolution of partnerships, the books of which have been kept by single |try, there is often difficulty experienced by the parties concerned in arriving at a it settlement. They have little or no knowledge of the principles of accounting, in consequence proceed on the wrong lines in finding a solution. Any intelligent person will be able to understand the following explanations and istrations, and apply the principles involved in effecting such settlements. When consulting an accountant on a matter of this kind, he will or should ask following questions : How much did each partner invest ? How much did each partner withdraw ? branch, and wiUBat is the total sum of the present resources ? What is the total sum of the account in thejent liabilities ? d. ebit side of youi 234 ■ki'K C These questions present to your mind the absolute necessity of keeping accounts in the ledger to show each partner's investment and each partner's withdrawals (whether money or goods), as well as personal accounts with those who become indebted to you and those to whom you become indebted. With such record in the ledger the matter of adjusting the settlement is simple. Begin by making a statement of resources and liabilities. If the sum of the resources exceeds the sum of the liabilities, the difference is the present worth or capital. Example : Merchandise, as per inventory, .... .... Bills Ueceivable, Note? on hand, .... ... Office and Store Furniture, as per inventory, . . .... Cash, .... .... . . ... Personal accounts owing us. ... .... (taken from the ledger.) Show each on a line hy itself. Bills Payable, as per bill book, . . .... Personal accounts owing by us, ... ... ... (taken from the ledger.) Show each on a line hy itself. RRSOURCES. LIAIIILITIES, 1 10500 00 1 700 CO 1 300 00 1 260 00 1 1500 00 1 1600 00 1 720 °°l 12260 00 2.320 J The resources amount to $12260 00 The liabilities amount to 2320 00 The firm's present capital or worth is 9940 00 Now go to the ledger and see the record of investments and withdrawals of each] partner. Dr. JOHN JONES, CAPITAL ACCOUNT. O This side shows his withdrawals (of money, goods or value of any kind.) This side shows his 703. investment (of money, goods or value of any kind.) $40oo.c Dr. ROBERT BROWN CAPITAL ACCOUNT. Cr. This side shows his This side shows his withdrawals (of 600 investment (of money. .?40oo.o money, goods or value of any kind.) goods or value of any kind.) Deducting Jones' withdrawals from his investment, shows that his net investment is .§3300 c Deducting Brown's withdrawals from his investment, shows that his net investment is 34000 Total net investment is $6700 You see now that $6700 was the actual investment by the partners, and ast present worth or capital, as shown above, is $9940, it follows that the increase mui have come by the gain made in the business. So to find the gain, we subtract t| actual investment from the present worth : Present worth $9940.00 Actual investment 6700.00 Net gain $3240.00 If the gain is to be shared equally, then divide $3240 by 2, and that will shl a profit of $1620 for each one; when you credit Jones* account with the $i62([ will sho" his present capital 10 be $4920 ; and when you credit Brown's accounH the $1620 it will show his present capital to be $5020. one's will noi above Dr. The will be from sinl 235 ing accoiinis withdrawals who bernme record in the g a statement I sum of the LIAHILIIIES, 1600 00 720 00 DO 2320 00 hdrawals of each] Cr $40000 Cr. §4000.0 The complete statement you can now make out as follows : STATEMENT OF RESOURCES AND LIABILITIES OF JONES & BROWN. (Date.) Merchandise on hand, as per inventory Hills Receivable, Notes against others Office and .Store Furniture, as per inventory ("ash, amount of money on hand I'ersonal Accounts owing us (Show each one on a. line by itself here, or make out a separate list of them.) Hills Payable, our notes unpaid , Personal Accounts owing by us , (Show e.ich one on a line by itself here, or m.ikc out a separate list of them.) John Jones invested 4000 00 *' *' withdrew 700 00 net investment 3300 00 gain 1620 00 present capital or worth Robert Brown invested 4000 00 " " withdrew 60000 net investment . . . . T 3400 00 gain 1620 00 present capital or worth . RESOURCES, 10500 700 300 260 1500 Si 2260 00 00 00 00 00 00 LIABILITIES. 1600 720 4920 5020 !5l226o 00 00 00 00 00 Go now to the ledger and credit each partner with his gain, then balance each one's account, and bring down the balance on the credit side. The partner's accounts will now be as follows, and will agree with the exhibit of their accounts made in the above statement : Dr. JOHN JONES, CAPITAL ACCOUNT. Cr. tmentis §3300' estmenl is 3400" ,lis 56700 ( ,artners, andastl t the increase mu An, we subtract tl » To Withdrawals, •« Balance, 700 4920 00 00 00 By Investment, "Gain, 4000 1620 00 00 5620 5620 00 ROBERT BROWN, ( By Balance (present worth,) :APITAL ACCOUNT. 4920 1 00 To Withdrawals, " Balance, 600 5020 00 00 00 By Investment, " Gain, 4000 1620 00 00 5620 5620 00 By Balance (present worth.) 5020 | 00 . *^" ^ ^. - ■ The Study of the work given above to illustrate the settlement of the partnership, It with the $ "■ ^jji j^^ of great service to the student in mastering the principles involved in changing brown's accou ■ ^^^^ single to double entry. They are in all respects the same. M 4* 236 You can see that every step necessary to change from single to double entry has been taken, except to open accounts in the ledger with Merchandise, Bills Receivable, Office and Store Furniture, Cash and Bills Payable, and charge or credit their respe< tive amou'.ts. COMPARISON BETWEEN THE DOUBLE ENTRY AND THE SINGLI ENTRY SYSTEMS, ^tiir If the student has never done so before, he will find it an advantage to compare the double entry and single entry systems of finding gain or loss in a statement simi- lar to the following. A double entry ledger shows at the close of the year the loss and gain account as follows : Dt. LOSS AND GAIN ACCOUNT. Cr Expense accounts under various heads Mdse. gain, and gains from other transferred here, ^3317-47 sources transferred here, 3930301 Net Gain, 5985.54 9303-01 930301 The advantage in the above is, that the sources of profit and loss are shown, and in order that a large business may be conducted intelligently, it is absolutely essential that these should be recorded throughout the year in the representative accounts, and finally exhibited in the Loss and Gain account. But suppose, for example, that the books of the business had been kept by single entry ; in order to ascertain the gain you would proceed as follows : The worth brought down on the Cr. side of the proprietor's account last year was $2235. 19 The worth now (or difference between the Resources and Liabilities) is But he withdrew from the business, as shown on the debit side of the proprietor's account, ......... So the gain for year is ....... or, do it this way : The worth a year ago was ....... Add withdrawals ........ Subtract present worth Gain for year 1265.55 969.64 5015.90 5985-54 $2235.19 5015-90 7251.09 1265.55 59S5-S4 Now go to the statement you took off at the end of the 8th set, which was done by single entry, and compare it with the statement you took off at the end of the first month of the loth set, wHich has the same transactions exactly as the 8th set, but is done by double entry, and you will be able to grasp fully the difference as well as the relation between the single and double entry systems. ilry has eivablc, ■ res\)e« slNGl-V, ) compare ment simi- ,r the loss Cr. 89303 01 237 CONTINUOUS BALANCE I EDGER. We illustrate a continuous Dalance Ledger in the three accounts followini;. The Tirst represents an accornt in n wholesale merchant's led(;er with a customer ; the second lepresents an account in a customer's ledger with a wholesale merchant. The third account represents an account in a banker's ledger with a customer, As will be at once apparent, the object of this form of account is, that the condition of the account, or in other words the balance, whether debit or credit, may be always shown nt a glance. In the first I wo examples the balance is carried out at the end of each month ; of course it could be carried out as ( ach transaction i.s recorded if this wns desirable. In the third example the balance is changed as unch transaction is recorded, because the ledger keeper in a bank must know at a glance the state of tach customer's account in order to accept checks expeditiously and with safety. FORM OF CONTINUANCE BALANCE LEDGER, MERCHANT'S MONTHLY BALANCE SHOWN. W. B. ROBINSON. 9303.01 ; shown, and tely essential iccounts, and cept by single $2235-19 1265.55 969.64 - 50«5-9o 5985-54 $2235- «9 5015^90 7251.09 . 1265.55 59?5-54 ivhich was done lend of the first 8th set, but is [e as well as the Date. Folio 1894 lune 29 129 4( 30 130 July 5 68 Ant;. >S •33 20 130 Sept. 5 139 i( 9 72 (( 1 1 7« ti 28 146 It 30 >5o Dr. 187 300 20 00 158 50 60 00 38 62 20 10 1 Cr. ' 1 PARTICULARS. 1 To Mdse,, 400 1 00 By Cash, To Mdse., ,411 1 87 1 202 6 ) 20 35 25 By Bills Receivable, 1 •' Cash, ' *' Discount, 1 To Mdse., 1 7 186 July 3 193 942 «S t 1 lb 200 (( . 17 201 50 60 4 t 20 205 3«5 97 l( 11 205 16 63 Sept. 25 301 30 305 Cr 560 ^20 "60 80 60 75 383 20 105 232 90 04 PARTICULARS. Dr. Bal. By Mdse. , II II II II To Bills Payable, By Mdse., To Mdse. ret'd., " Bank, " Discount, By Mdse , 000 00 oco 00 Cr. Bal 942 332 337 60 94 FORM OF CONTINUOUS BALANCE LEDGER, BANKERS' DAILY BALANCE SHOWN. GEO. RITCHIE & CO. Date. Folio. Dr. Cr. 1894 June 3 585 1600 00 3 S86 200 00 4 381 460 70 12 393 860 00 15 393 99 75 «5 596 920 00 16 602 300 00 23 610 820 00 PARTICULARS. Deposit, Check, Proceeds of Discount, Note due to-day, Collection (T. Jones), Acceptance due to-day, Check, Deposit, Dr. Bal. Cr. Bal. 1 1600 00 1400 ib6o 00 70 1000 70 IIOO 180 45 45 119 1 55 700 45 238 BOOKS OF LOAN AND SAVINGS COYS. The following forms of books, taken from those in use by the Freedhold Loan iV Savings Company, Toronto, one of the oldest, largest and soundest in Canada, an presented on account of their simplicity and thoroughness. Dr. CASH 18 NAMK Repay- ments on Mort'ge Deposits ceived. 'Siiiidrius Re- ceived. With.l'n from llnnk of Com. |Witlulii 1 from Imp. Ilk. Willulii ! from Stan. Ilk. Withd'n: from Ontario andUn'ii Hanks. 1 1 1 i 1 1 1 1 1 1 1 1 1 IIAI-ANCK, INTEREST JOURNAL No. tS NAMKS. IIORKOWKNS UEHOSITOKS. P. & I-. Dr. Cr. Dr. Cr. 1 1 1 1 1 COLLATKKAI ■ Dr. I Cr. MORTGAGE LEDGER. No. M Security Loan Privileges Report of Inspector Date. Folio. ITEMS. Dr. Cr. Unmatured. Arrerirs. 239 CONTRA 18 C^. NAMK. I on I'liid Murt'ge SuruIricM Paid fll>ep«wi'il7 I*|...M<|' I»f|)Msi',| I)..,,„Hi.l! i„(jMl,.r 11. Itankj u. Irm., inSlaii-i, i„ and "ftimi, Itank. dard llk.|| ir„ioti HALANCK ^=^-::=^ : I TERMS; C()U.ATEHAI.s. Dale o DEPOSIT LEDGER. %• Subject to 30 days. Dr. HAI.ANti:. intF':rkst. Dr. STOCK LEDGER. Cr. I!ai., ■•I llale. No. of Transfer. 1 AniuiiMt .Subscribed, Dr. Cr. Halancc. 240 CONDENSED SYSTEM OF BOOK-KEEPING FOR RETAIL BUSINESS. •tlattf. ifeti. The principles of Double Entry Book-keeping being fully understood, the Accountant can choose the particular style he may think best adapted to the business in which he is engaged. The prime object should, of course, be efficiency, and if a short condensed plan will give this result it should be adopted. The Six Column Journal method (see Set X) is adopted by many retail houses, and is admirably adapted for many lines of business, so is the plan of keeping a special column for credit sales of merchandise in the Journal, and posting them monthly in one sum to the credit of Merchandise account. (See first month of Set XI.) There are also the various methods of posting from Auxiliary Books direct, which large manufacturing and other establishments pursue. We desire here to point out a system for a Retail Business other than tliose | referred to, which we know by experience is thoroughly efficient and easily undesiood ; its main features being, keeping a Day Book Index, and Journalizing Monthly. The Books used are : Day Book and Index, Blotter Cash Book, Monthly Cash Book, Journal, Ledger, Bill Book, Invoice Book. The Day Book should contain the plain history of all transactions, except thosel affecting Cash, as they occur during the day. It does not matter so much about thel form of words used if the transaction is stated clearly and fully. You will at the closel of each day's business index the transactions. For instance, if John Adams, J. Brownl and R. Cummings have bought goods on credit during the Jay, under the letteisT respectively A, B, C, you will place the names (if they are not already there by reasoij of former transactions) and Day Book folio. If James Macfarlane gives you his nota in settlement of account, you will in the Index under the letters B. R. (BillJ Receivable) place his name and Day Book folio. If you give your note in favor ol John Macdonald & Co., and accept a draft of Galbraith, Christie & Co., you will under the head of the letters B. P. (Bills Payable) place these names and the Da| Book folio. IXAMPLE OF day BOOK INDEX. Adams, John Folio 57, 63, 71, .. A. Brown, J Folio 6 r, B. Cummings, R Folio 60, 63, 70, . . C. Mackarlane, Jas Folio 64, B. R. Galbraith, Christie & Co. Folio 69, B. P. Macdonald John, & Co. Folio 70, M. When the Day Book entries are Journalized, the fact will be shown in the Indej by running the pen through the figures, thus :V9 241 TAIL derstood, the the business iency, and if a y retail houses, 1 of keeping a posting them t month of Set y Books direct, ] ther than those I xsily undeslood ; Monthly. Dns, except those! much about thel u will at the closel Adams, J. Brownl under the letteisT y there by reasoiJ ives you his nota ters B. R. (Billj ir note in favor ol 5 & Co., you will imes and the Dal A. B. C. B. B. M. The above is sufficient to indicate the method of Day Book indexing ; circum- stances may require you to vary it more or less. The Blotter Cash Book will be the ordinary form without special columns, and should be balanced every night, and cash checked. The Monthly Cash Rook will be written up from the other at the end of the month, and will have special columns on each side representing the accounts for which money is most frequently received and paid out. See Cash Book for Set XI. In connection with the method we here recommend, some Accountants keep the Blotter Cash Book only sind /ournalize its transactions, as is done in the Municipal Set in this book. Either is right ; adopt which you deem most convenient. The Journal will be written up monthly, and here you have the explanation why you index the Day Book. As there is an interim of a month from one Journalizing to another, it is neces- sary that there should be an easy way of finding any particular transaction that has taken place in the meantime. For instance, Brown comes in to settle his account on the 2oth of July, you first take the entries posted in the Ledger up to the ist of the month ; having written these on the bill, you take the Day Book Index, and find whether any debts or credits (other than cash) are indexed to him for the current month ; if there are, it will direct you to the folios of the Day Book on which they are recorded. When Journalizing, first deal with the transactions other than those of Merchan- dise. You might begin with Bills Payable, then Bills Receivable, and so on till all the transactions recorded in the Day Book, except those of Merchandise, are Journalized, and then Journalize the credit purchases of Merchandise, and finally the credit sales. If you put Checks through the Cash Book you should not Journalize them ; but if you do not, you may either enter the Checks from the stubs of the Check Book to tlie Day Book at the close of each day, or Journalize them from the stubs direct ; in the example we pursue the latter course. The Invoices may either be entered in the Day Book to the credit of the parties from whom you purchase, as the goods arrive, or they may be kept on file till the end of the month and Journalized direct ; the latter is the plan pursued in the exam- '.J. Put the folio of the Journal upon the invoices in large figures near the date, in red ink, and either paste them into the Invoice Book or file them away ; in either case, in consecutive Journal Folio order. lown m 242 EXAMPLE OF MONTHLY JOURNAL JOURNAL. Belleville, December, i8gj. •luit m\ Ledger Folio. 192 .Sundries Dr. To Hills Fayablr. 260 John McDonald i\: Co., D B. folic .S9. f 420 96 249 .Sampson. Kennedy & Gemmel, " "60 209 50 232 Thos. Wall & Sons. '• "64. 320 90 241 Thos. May^:Co., " " 72. 470 00 I42I j6 ^"^^ jO '59 Bills Receivable Dr. To Sundries, 421 A. Forin, D B. folio 58. 79 20 438 R. W. H Duncan, " " 62. >59 60 491 W. R. Lett, " •' 69. 340 00 578 80 •5° Sundries Dr. To Bank. 23 Merchandise, For Check iSo, 75 00 141 Expense, " " 181. 24 «o 192 Bills Payable, '• ' 182. 490 00 250 John Wilson .V Co. , " " 183. •59 20 192 Bills Payable, '« " 184. 223 20 972 20 23 Merchandise Dr To Sundries. 263 T. J, Claxton & Co., as per Invoice of Dec. i, 1893. 459 60 263 Ditto •• " " 2, 272 50 263 Ditto " " " 20, •' 74 00 270 Young McNaughton iS: Co., " '•3. 160 GO 281 Ogilvy&Co.. " "7. .342 40 1308 50 23 Sundries Dr. To Merchandise. .^42.20 $10.90 $4 CO $9.60 45° A. Robertson, D.B. folios 59, 61, 68, 72. 66 70 583 J. Tennent, '• 60. $39.20 §?.6o $41.50. 27 40 476 E. Gillen, " 61, 64, 70. $10.90 $21.20 86 30 458 M. C. Wild, " " 64, 70, 32 10 471 H. Smith, " '• 63. 29 20 241 70 The Ledger statements and method of closing the accounts of this Set do not differ from those already given, and therefore require no explanation. The Bill Book will be kept as in the example given in connection with Set IV We would here simply emphasize the necessity of entering bills in the Bill Book, as well as in the Day Book, as they are given and received. If this be done, and you look at your Bill Book daily, in order to be aware of and advise your customers of paper coming due, and have knowledge of, and provide for your own bills maturing, there will be no danger of paper being dishonored and protested without your] knowledge. For an Invoice Book we recommend a book about 12x21 inches of strong I manilla paper, well bound, containing about i.^o pages. Into this the invoices should be pasted as they are Journalized. As all that is necessary to see when looking; for an invoice in the book are the name and Journal folio, you should fold the invoice | so as to occupy as little space as possible. 'ler, 1893. 96 90 CX) 20 60 00 00 80 00 20 20 1421 36 60 50 00 00 40 70 40 30 10 20 578 i So 972 20 1308 I 50 243 MOTHER CONDENSED SYSTEM OF BOOK-KEEPING FOR RETAIL BUSINESS BY THE USE OF A SALES LEDGER. 241 i 70 his Set do not on with Set IV, e Bill Book, as done, and you ar customers of ; bills maturing, I without your iches of strong invoices should hen looking for [old the invoice In large retail houses, that do a credit business, the plan of keeping a Sales edger is found to be a convenient, quick and direct method of dealing with ustoniers' accounts. Instead of charging sales in a day book or blotter, they are entered directly on he debit side of the customer's account in the sales ledger in detail. The advantage of this plan is in the facility it affords for making out accounts, s every item is before the book-keeper without the necessity of referring to any other 00k. The Sales Ledger is solely for Personal Accounts with Customers HO BUY ON Credit. The general ledger is kept besides, and one account in it, illed "Sales Ledger Accounts" represents all the accounts in the sales ledger. he debits to this account in the general ledger are the monthly summaries of sales s shown in the several accounts in the sales ledger, The credits to this account are be monthly summaries of credits as shown in the several accounts in the sales ledger he debit balance of this account, when the summaries have been debited and edited as explained, should correspond with the total debit balances of all the ccounts in the Sales Ledger. ^t the end of each month, or of a longer period, if desired, sum up the merchan- e 1 ' ncd to the various accounts in the Sales Ledger, and make a journal entry '" ■ .5 Sales Ledger Accounts, Dr., To Mdse. For the sales of Mdse. on acct. as shown in the Sales Ledger for Jan. 1894, post ithe debit of the former account and to the credit of the latter account in the leneral Ledger. Now deal with the credits at the personal accounts, P'irst ascertain the sum of le Mdse. returned or allowed and credited in the Sales Ledger and make a journal ntry as follows : Mdse. Dr., To Sales Ledger Accounts. or goods returned in Jan., 1894, as shown in the Sales Ledger. The other credits will be those of cash payments and settlements by notes and :ceptances. For the cash payments, keep a special column on the debtor side of le Cash Book, (see an illustration of this in the C. B. at page 177,) the total of hich at the end of the month you will carry in one sum to the credit of " Sales dger Accounts" in the General Ledger, but each individual payment will be edited to its proper account in the Sales Ledger each day. The settlements by note acceptance were duly recorded in the Bill Book, and at the same time credited to le customer in his acct. in the Sales Ledger, so you have simply to ascertain the ital sum of notes and acceptances received during the month and make the following urnal entry : Bills Receivable, Dr., To Sales Ledger Accounts. or amount received on personal accounts for Jan. 1894 as shown in Bill Book and iles Ledger. m 244 •*»*«■ r The methods indicated above are illustrated in the following transactions wiJ persons, as shown in the ledger entries for Jan., 1894, and the journal entries whiij follow : W. J. OSBORNE. Dr. Column for Monthly Totals of ^ , Debits. Ct. I 1894 fan. 2 it 8 $125.30. Mal^t an additional fee is required for this. The annual subscription to an agency is 5; $10 extra is charged subscribers who take the Daily Bulletin , which is a record business changes, and of the Bills of Sale and Chattel Mortgages given, and Writs !ued and Judgments given. Should a mercantile agency do any one an injustice by publishing incorrect lorts, it is liable for an action for libel and the payment of heavy damages, as the celebrated case of Carsley vs. Bradstreet, a report of which we append : Court of Appeals, Province of Quebec. BRADSTREET VS. CARSLEY. The Court of Appeals, Chief Justice Sir A. A. Dorion presiding, gave judgment lay in the important case of Bradstreet vs. Carsley, in which a point of great test to commercial houses was raised. In June, 1884, Bradstreet's commercial ncy issued a circular to about 600 of their subscribers, in which opposite the name 00 $4.76. Make tlj 1 a special colui will now foot from the cash boi 246 *^m imt ^tm'm. of Carsley & Company appeared the words "Call at office." This, Mr. CarsIeJ claimed, was intended to convey the inference that the agency was aware of soma thing detrimental to the business standing of the firm, and so lead people not to deaj with them until they called at the office for such information, and that when some them did call they were told that Carsley had asked his creditors for an extension time for the payment of ;^'6o,ooo sterling. Mr. Carsley claimed that such reportl were totally false and without foundation, and that by the issuing of such circular hi had suffered damage to the amount of $50,000, which sum he sued to recover. \\ the Superior Court, when the case was first heard, judgment was given for CarslcJ who was awarded $i2,oc»o damages in each of two separate actions. Bradsireeil appealed to the higher court, which to day declared that the words complained ol " call at office," were an indication that there was something wrong with the firm, fj if the information to be given had been good there would have been no reason (i secrecy. The information given to those who called, a large number of whom \ve| not subscribers 'o the agency, was not true, caused considerable damage to the firij and might have <:aused the ruin of a less well-established business. The informatiJ given could not be held to be a privileged communication, and it was not asking td much from mercantile agencies to demand that they ascertain the correctness of the| reports. Furthermore, the agency should not have conveyed any information 1 others than their subscribers, and had rendered themselves guilty of libel and slandJ in the premises. For all these reasons the judgment of the court below was co| firmed, with costs in both cases. TRUSTS COMPANIES. Trusts Companies are of recent origin, and have been called into existenl because of the necessity that exists for something more secure than the chance leisoj of private individuals for carrying out an important trust, a will for example. Prior to the establishment of Trusts Corporations a man, when making his will, no alternative but to appoint an individual or individuals as his executor or executor! or if a man died intestate, the courts were obliged to appoint individuals as admii strators. Persons so appointed might be dishonest or incompetent or careless ;i supposing them to be fitted in all respects for the trust, they might not have time] spare from their own business to do it justice ; while over and above all these sibilities, there was no gurantee of continuity, as the individuals appointed mightij Trusts Companies will undertake a trust of almost any kind ; and as they esl solely for the object of attending to matters entrusted to their care, and their exi ence does not depend upon the life of any individual or individuals, the risk involj in the appointment of private persons, as indicated above, is, when such corporatiij are appointed, entirely avoided. They will act as Executor, Administrator, Receij or Guardian, and as agent in any capacity. These various positions and duties 1 assumed by the company either under Deeds of Trust, Marriage or other settlemd executed during the life time of the parties, or under wills, or by appointment oil court. They also undertake the investment of money in real estate niortgj securities, collecting and remitting the interest for a moderate charge. They either invest the money as agent in the usual way ; or, should the investor prefer, will for an extra charge guraantee the principal and the prompt payment ot| interest on fixed days, yearly or half yearly. P sum tha Th ye one you can his, Mr. C'arslej 5 aware of somd )eople not to (led lat when some r an extension that such reponj f such circular h| i to recover, given for (^arsleJ ions. Bradsireeij ds complained ol , with the firm, fj een no reason fJ )er of whom weil amage to the fid The informatia was not asking tJ correctness of the] any information i of libel and slandl urt below was col ailed into existeni m the chance leisuj r example, making his \vi lecutor or executoi lividuals as admi tent or careless; ht not have time ibove all these ;i appointed mights i ; and as they es| ;are, and their ex| .als, the risk involi en such corporatit rainistrator, Receii tions and duties e or other settletnt y appointment oil real estate niortpj e charge. They e investor prefer, tl| impt payment of 247 Trust companies are found useful by ninnicipal corporations who are creating and maintaining sinking funds, and by companies appointing trustees on behalf of creditors. The first company of this kind established in Ontario is the Toronto Genekal Trusts Company, which has been in existence ten years, and which has been not only successful from the shareholder's point of view, but has proved to be both trust- worthy and invaluable in the multitudinous duties it has been called to perform. GUARANTEE COMPANIES Guarantee Companies (called also Fidelity or Surety Companies) exist for the purpose of granting Bonds of Suretyship for the faithful discharge of the duties of employees in positions of trust. They obviate the necessity which formerly existed for these dangerous responsibilities being assumed or continued by Private Individuals, and afford the Employee an opportunity to be his own indepenf]( "^ surety if he be a reputable person, and so to establish his reputation in the most satisfactory manner to his employers and himself. The Bonds of such companies are accepted and preferred by Governments, Banks, Railways, Insurance Companies, Municipal Councils, and Commercial Institutions generally, in place of Private Bonds. The oldest, largest, and best known Guarantee Company in America is the Guarantee Company of North America, head ofifice, Montreal. Its bonds are accepted thronghout the American continent. To secure its bond, you will make application through a iocal agent, or direct to the head ofifice ; in which give the fullest particulars of yourself and the position in which you are to be bonded, and give the names of several people (not relatives) who know you thoroughly, to whom the company can apply for information regarding your antecedents, character and habits- When the application has been received, the company will send a printed form to the persons you have named, in which a comprehensive list of questions is asked, and from the answers to which the directors will determine whether you are worthy of the company's confidence and guarantee. The rate charged by the company is about one per cent, upon the sum of the bond. Just as a life insurance company would insure your life, or a fire insurance company would insure your property, so a Guarantee Company will insure your character. Practically, then, the business of such a company is insurance — of character. INSURANCE. Insurance is a Contract of Indemnity. That is to say, only FIRB. the actual loss sustained will be made good, and not the amount insured. It is folly, therefore, to pay a premium upon a larger 1 sum than the actual value of the goods. The principle of insurance is exemplified in that scripture injunction, " Bear I ye one another's burdens." Select say loo people who are possessed of property, and you can safely predict, in accordance with previous experience, that within a given Hi I4«ft 248 time some of them (but not all) will suffer loss by fire. If each one belongs to an insurance association, the members who have not suffered will contribute to make good the loss of those who have ; or, in other words, help them to bear their burdin. It would be inconvenient and not always safe if the carrying out of this help were left to the contributions of each member when a loss occurred ; so the majority of people insure with regular companies who receive a premium at stated periods, for which they undertake that when a loss occurs they will indemnify the sufferer. The law of average, implied in the principle above alluded to, forms the basis of the calculation of ..je rate to be charged. Insurance has been a great help to commerce, as people with capital would refuse to risk it if there were no possibility of obtaining indemnity in case of loss by fire or other disaster. It was after the great fire in London in 1666 that insurance was applied to fire risks. There are three principal conditions in a contract of insurance, namely : (?) There must be an actual risk. (2) There must be similar risk among a large number. (3) Losses must relatively be few. The latter element would be absent in insurance of bad debts, as recently proposed, for all men engaged in business must inevitably make bad debts. There are Mutual Fire Insurance Companies, which usually confine their opera- tions to a county, and insure farm property. The members give their notes for a certain sum, which are held as security that they will contribute their share of any loss sustained by fire by any member. This principle would be unsuitable for mer- cantile risks. One feature of security to the insured and stability on the part of the company (the insurer) is, that it does business over a wide area, and does not take its risks in one or few localities, where one great disaster might cripple or ruin it. The person desiring to insure makes application to an agent of the company, describing the property accurately and concealing nothing that should be known. Should there be concealment or misrepresentation the contract will be vitiated. If there is already insurance in existence with one or more companies, each must be notified of the new insurance, and the company with which the new insurance is being effected must be notified of the prior insurance. All material changes or altera- tions in a building, a change of tenants, or of the use to which a building is put, the removal of goods that are insured from one building to another, must be reported, and the facts noted on the policy. The agent has not the power to issue a policy ; he can only give an interim receipt, good for the days mentioned upon it. He submits the application and sends the premium (the amount paid for the insurance) to the head office and the directors determine whether they will take the risk ; if they are willing, the policy (the evi- dence of the contract) will be issued ; if not, the money paid by way of premium will be refunded, less the amount for the time for which the property was insured under the interim receipt. Goods insured cannot be replaced unless the policy is upon a general stock of merchandise, or on household effects that are mentioned in general terms. It is well to read over the conditions of a policy, which are printed on the back. In case of fire, the insured is bound to do all he can to save property. He can- not walk away, saying, "Oh, it's insured, let it go." A notice of the fire must be sent to the company within 15 days, and should be accomp.'\nied with a statement of 5longs to an te to make leir burden, is help were majority of periods, for fferer. Tlie basis of the commerce, of obtaining pplied to lire lamely : (t) large number. t in insurance ast inevitably e their opera- r notes for a share of any table for mer- tie part of the les not take its ruin it. the company, Id be known, e vitiated. If each must be N insurance is inges or altera- ing is put, the It be reported, ive an interim [ion and sends d the directors policy (the evi- premium will insured under Ucy is upon a »ned in general printed on the )erty. He can- re must be sent statement oi 348 claim. The company will send an adjuster, who will settle on a fair basis when he has seen the evidence of the actual loss, beyond which, of course, not a cent will be paid, no matter what the amount of the insurance was. If there should be difficulty in settling, an appraiser will be called in. The evidence of the amount of loss on the part of a merchant would be his last inventory of stock and the amount of invoices of purchases since it was taken, less the sales since then. Well kept books and systematically arranged papers, cared for in a good safe, are a great comfort and satisfaction in the event of fire. A Specific Policy is one insuring only definite goods ; a Blanket Policy is one covering all goods. S.-xlvage is the term applied to goods rescued from fire or shipwreck. Life Insurance is not a contract of indemnity, like fire insurance, LIFE. and there is therefore nothing to hinder a person from insuring his life in as many ofifices as will accept him ; and his heirs will recover ihe total amount insured from all the companies. The person who insures a life must himself be the life, or he must have a pecuniary interest in it. For example, a creditor can insure the life of a debtor, and although the debt be discharged subsecjuently, he will be entitled to recover the insurance if he keeps it in force by laying the premiums. Scrupulous good faith is just as necessary in effecting life insurance as in taking out a fire policy. Fraudulent concealment or misrepresentation would, if discovered, make the policy void. The features which are most important in choosing a company in which to effect life insurance are, first, absolute security, and second, profit. The test of the first will be a comparison of the assets with the liabilities ; of the other, prudent and economical management, and safe and profitable investment of funds. The amount charged for life insurance, is based upon recognized and well established mathematical principles, applied to these three elements— the rate of interest which will accrue from the investment of the premiums ; the rate of mortality, with which the experience of the insured is expected to agree ; and the proportion to be added to the net rates to meet expenses of management, and afford a profit to the insurer. We have in Can- ada Life Insurance Companies that conform to the soundest principles, and are I among the best in the world. In additi(m to the regular Life Insurance Companies, to which alone we have Ihitheito alluded, there are assessment societies which undertake that on the death of a member it will collect from each of the remaining members the sum of one dollar (or lother sum) and pay the amount collected to the heirs of the deceased member. This Icannot be considered as insurance:, for the payments are at the will of the individual Imembers. It is simply an implied agreement on joining the society that each member Iwill present a dollar to the family of a deceased member when death occurs. This lagreenient may be carried out, or it may not. There can be no guarantee that it will. ISocieties of this kind in the past have flourished for a time, until driven to the wall Iby competition of kindred ones, or the unwillingness of members to pay the death |calls when they, (as they must inevitably) become numerous. Only those members ffho die young, profit by connection with these societies. These remarks would not apply to such a society as the Oddfellows, but only to [hose societies that exist purely for assessment purposes. n »0 MARINB. It was to marine risks that insurance was first applied. It was termed underwriting, and those who undertook the risks were called underwriters. (These terms are now c l«« •jno generally applied in all classes of insurance.) Marine insurance in Canada and the United States is carried on by companies. In England, while much of the insurance is done by companies, it is a remarkable fact that the largest portion is effected by private individuals, who are members of " Lloyd's," so called from the society having originally met in a coffee house in London, kept by a person of that name. Lloyd's has a world-wide reputation. " Classed A i at Lloyd's," is an expression which refers to the rating of a vessel in the society's books. Marine insurance differs materially from fire insurance in respect to the adjust- ment of loss. The owner (or underwriter), in case of partial loss, pays only such a proportion of the sum insured as the damage sustained bears to its whole value at the time of insurance ; that is to say, if a portion of the cargo has been damaged or thrown overboard, the owner (or the underwriter) of the particular goods will suffer no greater loss in proportion to their respective interests than the other owners of goods on board and the owners of the ship and freight. This contribution is called General Average, Jettison is the throwing overboard of a ship's cargo, or a portion of it, in order to lignten the vessel in a storm. The goods that are cast overboard and sink are called Jetsam, and those that continue to float, or have floated to land, are termed Flotsam Particular Average, as distinguished from General Average, refers to, say, the loss of an anchor, the starting of a plank, where the common safety was not in (jii'^s- tion, and where there is, consequently, no contribution. ANNUITIES. An Annuity is a yearly payment of money to be received for life, or for a term of years, in consideration of value surrendered, or money advanced to those who pay. The person who receives an annuity is called an Annuitant. With individuals who are to pay, the annuity may be a charge upon personal estate or real estate. Persons who have a limited capital, and are not capable of investing it profitably under their own control, or who have not the opportunity of using it along with their 1 own labor, may purchase from an Insurance Company or a Government an annuity that will give the largest possible life income. For example, here is a person with a capital ot ten thousand dollars, who has no one to whom he cares to leave his capital at his death. He simply desires to secure for himself the largest possible income from that sum for life (unaccompanied by his labor.) Investment in mortgages or debentures, or good security of any kind, would not yield him over six hundred dollars a year ; but if he surrenders his whole capital by buying an annuity, he can for| life, and without risk or trouble, secure a very much larger income. CO PRECIS (pronounced pra-se). A Precis is a concise or abridged statement, or, in other words, a summary orl abstract. For instance, to convey in one's own language a concise statement of al page or pages from some author, or of the evidence given before a court, would be ah jpTin\ precis. One may listen to or read a speech, and without attempting to report it wordB' -^-Ki or word, may make a precis of it that will convey the gist of what was said. I ji/ii If you wish to practice precis writing, read a chapter, say, from Macaulay'^ English History, and then write out a summary of what you have read. Or, attends political meeting or listen to a sermon, taking notes as it proceeds, and from the note! write out a summary of what was said. Facility in this matter is acquired by suclf practice as we have indicated. It embraces a mental process that is exceedingljj beneficial. THE to the adjusi- ; only such a le value at the damaged or Dds will suffer her owners of ition is called 3, or a portion :ast overboard loated to land, rs to, say, the as not in qi'.es- CANADIAN ACCOUNTANT. Hi CONTAINING A COMPREHENSIVE SUMMARY OF ONTARIO LAW FORMS OF BUSINESS PAPERS, COMMERCIAL CORRESPONDENCE AND COMMERCIAL CALCULATIONS. COMPREHENDING iBBREVMTED METHODS OF PRACTICAL COMPV- TATIOJ\f, SETTLEMENT OF ACCOm'TS, S'c, J\VT FOUJVD IJV COMMOJV ARITHMETICS, il 2n2 C mil iii;< SUMMARY OF ONTARIO LAW. Prepared by William N. Ponton, M. A., Barrister and Solicitor, Belleville, lectiU' r on Commercial Law at Ontario Business College. Actions. — An entire clianK*-- in lliu procedure and practice of llic Courts was alTcctcd hy the Ont;iii i Judicature Act lS8i. I.avv and Hrpiity arc adniini.stercd concurrently. All the .Superior Comti were cousolid.ited to^eiher to form the .Supreme Couit of Judicature for Ontario, which con^i is of two pcimnnent divisions, "The Court of Appeal for Ontario" and "The High Court n( Justice (or Ontario." All actions in the Supreme Court are commenced by a writ indorsed with a statement of tin; claim made or of the relief or remedy sou(;ht. The writ re(|uires the defendant, if served in Ontario, to enter an appearance within ten days after service. The defendant may set off or set up by way of counter-claim any claim which ho has against the plaintilV. II the defendant claims indemnity or contribution or other remedy over a|;ainst any third person, provision is made lor service of notice on such third person. Speedy jud^jment can be applied for after a writ u( summons has been issued, when it is made to appear to the Court that it will be conducive to the ends of Justice. Inferior jurisdiction is exercised by County and Division Courts. County Courts have no jurisdiction in actions where the title to land is in question, or where the validity of any devise is disputed, nor in actions of libel or slander. County Courts have jurisdiction in personal actions where claim docs not exceed $200. In all actions of debt and contract, where amount is liquidated or ascertained, they have jurisdiction up to $400. Division Courts are held fre(iuently, and are presided over by the County Court judges. There are twelve Division Courts in the County of Hastings and ten in the County of York. The scale of costs is very low, and the Court has been called the poor man's Court, which it is in more senses than one. The action should be brought where the Defendant resides or where the cause of action arose. The Ctnirt has jurisdiction in all personal actions to sJGo, in all claims of debt or breach of contract to J? 100, and where the amount is ascertained by the signature of the Defendant to !?200. The Judge may commit a Judgment Debtor to gaol for the several causes set out in Sec. 240 of the Division Courts Act, R. S. O., cap. 51 and amendments thereto. Administration.— See page 120. Affidavit.— See Registration. AiM'EAU — There is (except in matters of discretion) an appeal allowed from a single judge of the High Court to the full Court, and thence to the Court of Appeal for Ontario, thence in some cases to the Supreme Court of Canada, which sits at Ottawa ; and in very important cases to the Judicial Committee of the I'rivy Council in England. An appeal is also allowed from the judges of the County Court to the Court of Appeal, and in those Division Court actions where the aniounl involved exceeds §100. Ari'RorRiATiON OF 1'ayments. — The buyer or debtor has the right to appropriate the payments made by him to whatever items he chooses. If he does not so appropriate, the person receiving the money may apply the payment even to reduce a debt barred by the Statute of Limitations, (.See Limitations below.) Aliens may hold real and personal property as freely as natural born subjects, but labor under disability as to the franchise. Aliens may become naturalized by taking the oath of allegiance to the .Sovereign, and obtaining the sanction of a judge in open Court or Sessions. Arbitrations are more frequently adopted lor the settlement of disputes than formerly ; while they are sometimes more expeditious, they are not always more inexpensive than ordinary law suits, Arbitrations may grow out of law suits, the judge having power to refer the matters in question before him to one or more referees, especially where there are involved accounts. Nearly all Insurance Companies require claims to be arbitrated when they are disputed. The price of land; expropriated by Railway Companies or by Municipalities for rights of way is generally ascertained by arbitration. An award should generally be under seal, and signed by all the arbitrators in presence of each other. Some references provide that the award signed by two out of the three arbitrators shall be binding. The award may be made a rule of Court, and afterwards enforced by judicial process. Care should be taken that the arbitrators do not exceed their powers under the reference, and provision should be made for disposing of the costs of the arbitration and 253 ille, lectiif r )y ihe Ontaiio upcrior Cmuu which consi-is High Court of alement of llic U, if servcil in ay set olV oi -lI efendant cluims iion is inaile f"t after a wnt "f :omlucive to ihc County Courts 3 valiiHty of any :tion in personal where amouni is I judges. There fork. The scale lich it is in more c where the cause claims of debt or of the Defenilanl I causes set out in |udge of the Iligli in some cases to ses to the Judicial the judges of the where the amount iate the payments le person receiving ute of Limitations, but labor under ;ign, and obtaining merly ; while they ordinary law suits. matters in question lounts. Neatly all The price of lands enerally ascertained 11 the arbitrators in wo out of the three er wards enforced by ir powers under the the arbitration and award. The Statutes provitle for arbitration in the cases of disputes between masters and work- men, injuries to employees, etc., etc. I'rofcssional arbitrators are entitled to from i?to to !#jq per (lay. Non-professional arbitrators are allowed from $5 Id $10 per day, or as may be a^jrecil. Formerly war was the only arbiter of nations ; now International Arbitration rather than blood- shed is the basis of Treaties. Aw REST for debt has been abolidred, except in cnnes o( frauilulent disposal or concealment of pro[)erty liable for debt, and refusal to cive projicr answers on examinatiim as a Jmlnmenl Debtor. In these cases, however, it is rather for contempt of Court and refusal to obey its orders than for debt, that imprisonment is decree 1, Debtors may also be arrested on capias and lu-ld to bail, i| it be proved to the satisfaction of the judjje, on behalf of a bona tide creditor, that the debtor is about to leave the jurisdiction with the design of defrauding creditors. Assic.NMENTS made on the eve of insolvency, with intent to prefer a creditor or benefit a relative or friend, to the prejudice of creditors generally, are null and void, and will be set aside by the Court. Assignments in trust should be made to the Sheriff, or with the consent of the m.ajorily of creditors, to some other responsible person. While the Statute forbids any preferential security being given for a debt where assets are deticient, it does not invaliilale or make void any deed of assignment made by any debtor, for the purpose of paying and satisfying rateably and proportion- ably, and without preference or priority, all the creditors of such debtor, their just debts ; or any bona fi any other person, departs from Ontario with intent to defraud his creditors, and at Ihe time of his so departing ! possessed of any property, he shall be deemed an absconding debtor, and his property n .y be sel/.ed for his debts by a writ of attachment. Upon affidavit made by any plaintilf, that ,i ■ such person so departing is indebted to such plaintilTin a sum exceeding $iod.oo and stal ug the cause of action, and that deponent has good reason to believe, and does verily be'" "e. that such persi has de- parted from Ontario, and has gone with intent to defraud the ,)l.u,rirf of his just liues, or to avoid being arrested or served, and was at the time possessed o real or personal property, not exempt by law from seizure, in this Province, and upon the further affidavit of two other credibK^ persons, that they are well acciuainted with the debtor, and have good reason to believe and do believe that such debtor has departed from Ontario with intent to de''raud the said plaintiff, (jr to .avoid being arrested or served, either the High Court or the Judge of any County Court may direct a writ of attachment to issue, and may appoint the tiiiir for the defendant's putting in special bail. Hills ok Exchanc.k, and Promissory Notes.— See page 259. Bills ok Sale and Chattel Mortcac.es. — Every mortg.age or sale of goods and chattels, not .accompanied by an immediate delivery and followed by an actual and continued thittgc of pos- session, must be in writing, and be .accompanied '-y an affidavit of execution, and also by an affidavit by the mortgagee or bargainee, or his n^ 1' '.Isuch agent is aware of the circumstances connected therewith, and is properly authorized in 'A'riling to take such mortgage), as to the /w/ayfi/t'.f of such mortgage or bill of sale, and must be tiled in the office of the Clerk of the County Court of the county where the goods n re situ.ated, within live days from its execution otherwise such mortgage or sale will be vo^l as against creditors of the mortgagor or bargainor, and as against subsequent purchasers or mortgagees in good faith for valuable consideration. A chattel mortgage will cease to be valid after the expiration of one ye.ar from the filing, as against creditors or subsequent mor'gagees, unless within thirty days jireceding the expiration of the year, and so on from ye.ar to year, a statement is fded in the office of the Clerk of the County Court of the county where su?h goods and articles are then situate, stating the interest of the mortgagee, and showing the payments made on account and the amount still due, accompanied by an affidavit by the mortgagee or his agent (authorized in writing) swearing to the truth of the statements, and that the mortgage is not kept on foot for any fraudulent purpose. Where goods are actually delivered and handed over to the purchaser, a Bill of sale is not necessary, but is always advisable as evidence of the transaction. The goods should be described distinctly so as to be readily identified, and great care should be exercised in observing all the formalties recjuired by the Act I* 254 •»«'•«' ^^. R. S, O., cap. 125, and amendments thereto. Chattel mortgages are often taken as collateral (additional and contemporaneous) security to Bills and Notes, and, if so, the fact should always be so expressed in such security. Bonds are obligations under seal wherein the obligors and sureties are bound in certain penal sums tn the performance of certain conditions. If sureties are obliged to pay, they must contribute pro- portionately. Bonds of indemnity are required by Banks when deposit receipts are lost, and liy the Courts when a lost note is sued on. Contracts may be made by letters, telegrams, and detached papers, as well as by a formal instru- ment. Contracts made on Sunday are void, but may be ratified on a week day. Contracts are construed by the law of the place where made, and the ivAo/e contract including recitals is considered ; the custom of ma chants plays an important part in the decision of commercial cases. Specialty contracts are contracts under seal, which do not require any consideration to be ex- pressed. Simple contracts are those not under seal, whether verbal or written. A minor or infant may contract for necessaries consistent with the minor's station in life. An infant may, after attaining 21, ratify in ivriting a contract made during minority. A will is not a con- tract, being always revocable by the testator. A contract, to be valid, requires the mutual as- sent of competent contracting parties ; a good and valid consideration something to be done or omitted, and a legal object. Contracts in absolute restraint of trade are held void for reasons of public policy. The Statute of P'rauds requires all contracts regarding lands (except leases for 3 years), all contracts not to be performed within one year, all guarantees for the debt of anoiher, and all contracts for sale of goods over the value of $40 (unless partly executed and perfurnied), to be in writing. The contract is not the writing. The writing is the evidence of what the contract is. Common Carriers, Travellers, etc. The liability of Railway Companies, both as to freight and passengers and baggage, is very stringent, and they cannot avoid their responsibility by any conditions endorsed on tickets or shipping I receipts, which would tend to render nugatory the whole contract, or would excuse the negligence of their employees or agents. All conditions must be reasonable. If baggage is left at the station of destination an unusual time, the liability of the company is only I that of warehousemen, not of common carriers, so that if a fire should accidentally destroy the | baggage room and goods, the company would not be liable An insurance policy against ac- cidents, while travelling in a public conveyance, is always construed in favor of the insured, and I covers accidents which occur when alighting, or changing cars. A ticket is a contract, and a I time-table is a representation. Railway Companies are not liable for mere loss of time occasioneJ by delay of trains, but are liable for actual pecuniary special damage, which can be proved tol have directly been incurred from such delay. A traveller who refuses to pay his fare to an ofiiciail authorized to receive it (and wearing on his cap the badge of such authority) may be put off tlij train, but only near some dwelling house or at a usual stopping place. The company is responsible for the act of a servant acting within the scope of his employmeni, even when disobeying orders. A railway track per se is a warning of danger. The liability oil employers for damages to their employees is now governed by the provisions of the "Ontario[ Workman's Compensation for Injuries Act, 1892," which requires notice within twelve weeks, and action within six months. Common carriers are bound to use the highest degree of care that a reasonable man would use foij himself, and to secure safety consistently with the mode of transportation. Shipowners are bound to furnish a vessel sea-worthy and well equipped with adequate crew ani competent master. Owners of stages are responsible that all equipments of conveyance, drivetsj horses and harness, are (it and suitable. Carriers are not liable, where by the exercise of reasonable care on the part of the injured, i!i| accident might have been avoided, t. e., where there was " legal " contributory negligence. Conveyances of Lands are made by Deeds which are instruments under seal, executed by vendor (grantor ) to the purchaser (grantee). It is most important that the lands intended to 1 conveyed should be clearly defined, otherwise the deed cannot be registered. Courts.— Sec A(tio»s. 255 en as collateral t should always in penal sums ui , contribute pro- are lost, an 256 Femme Coverte. — A married woman may now hold her separate property as though she wen a femme sole (spinster). In deeds of lands it is always better, however, to get the husband to join, so as to get rid of his possible claim to a tenancy by the courtesy (Life Estate). Insurance. — A fire insurance policy is a contract of indemnity. Nothing should be concealed from the Company which is material to the risk, whether as to ownership, incumbrances, value. location, occupation, or prior or other insurance. A personal debt of the agent cannot be set olT as against a premium on a policy. If insurance is assigned, the Head Oftice of tlie Company should ratify the assignment Life insurance may be effected in favor of wife and children, ami creditors cannot touch proceeds. It is always advisable to get an admission of age when effeclini; insurance. Concealment even without fraud has been held to vitiate a policy. Insolvency. — The Insolvent Acts have been repealed, and a bankrupt cannot now obtain an absolute discharge without the consent of creditors. The Creditors' Relief Act (the validity of whicli has however been impeached in the Courts) abolishes priority among creditors, and provides for the rateable distribution of assets in the sheriff's hands among those who have obtained judgmcm within a limited time. The act does not interfere, however, with those creditors who hold valid special securities. — See Assignment. Interest. — Where no rate is stipulated for by agreement, only six per cent, per annum can \k recovered, calculated from the time the debt was due and demanded. There are no usury laws in force in Ontario, but loan companies and money lenders are not allowed to charge a higher rale j on default of payment than they would have charged had payment been regularly made. If a mortgage is in default, the mortgagee is entitled to six months' interest as bonus, belore the mortgagor can redeem, unless the mortgage has run for five years, and was made after the Statute I in that behalf, in which case the mortgagee is obliged to take his money in full on being paid three months' interest in advance by way of bonus. Interest does not run on an open overdue accouni unless demanded. The Courts regard interest as damages for detention of money. Instrumwi!! drawing interest at a higher rate than 6 per cent, should be expressed to bear interest at that rale | as well alter as before maturity. Joint Stock Companies.— See after /"ar/M^nVn)*. Landlord and Tenant. — Set Mortgages, Taxes and Extmptiom. A yearly tenant requires a full six months' (183 days) notice to quit, expiring at the end uf i| year. A monthly tenant requires a full month s notice to quit. Tenants desiring to leave shoiili give the same notice. Goods distrained for rent can be sold after five days from seizure anJJ demand. Leases for seven years should be registered. Leases for three years and shorter periods are valid even though not in writing. Limitation. — Actions on simple contracts, notes, instruments not under seal, and money dem must be brought within six years from the time the cause of action accrues, When plaintilTiJ under disability by reason of infancy or lunacy, the statute runs from the removal of the disability.l Actions to recover lands must be brought within ten years after the right of action accrued,— thai) is to say, if A enters on B's cultivated lands, and stays there in open, peccable continuraiJ possession for upwards of ten years, not as a tenant or caretaker, he acquires a title by possessioni to the land so trespassed on, and can successfully resist an action of ejectment. A niortjjaj^e \\ outlawed in n years after maturity from the last payment of interest or acknowledgment, sofaiT as the land security is concerned. Convenants are good for 20 years. See however Cap, i;| Ontario Statutes, 1893. Mechanics' and other Liens, — Every mechanic, machinist, builder, laborer, contractor, siilil contractor or other person doing work upon or furnishing materials to be used in any buildini,', ol machinery in connection with any building, has a lien for the price of the work, etc., on siic| building, mines or ereclion, and the land occupied thereby and enjoyed therewith. The lien will lost if a claim be not filed in the Registry OITice within 30 days from completion of work i supplying of materials, and legal proceedings to enforce the lien must be taken within 90 days. A solicitor has a lien on his client's papers for costs incurred. A workman has a lien onj chattel for cost of -cpairs and improvements done by him. An inn-keeper has a lien on tlie fiuoill of his guest for urpaid board and lodging. A pawnee has a lien on goods for money advancel by him. A lien is a right to possession ; possession being given up, the lien is gone. 257 hough she wer( a e husband to join, be concealed from umbrances, value. it cannot be set off :e of tlie Company ; and children, and age when effeclini; V obtain an absolute didiiy of which has ,nd provides for the obtained judf^meni tors who hold vahtl per annum can bt are no usury laws in charge a higher rale gularly made. If a IS bonus, beloie the lade after the Statute | 11 on being paid three )pen overdue account noney. Instruments] ,r interest at that rale piring at the endof ij isiring to leave shoulil lays from seizure aiiJJ •iting. and money demandsi les. When plaintilTiil noval of the disahili!)! action accrued,— ihall peccable continun»^l es a title by possessioni ment. A niort^afie il cknowledgment, so fail See however Cap. i;,! lorer, contractor, siill sed in any buildini;, cl he work, etc., on suclj with. The lien will 1 :ompletion of work il ken within 90 days jrkman has a lien on j has a lien on the good! Is for money aclvan«| en is gone. Mortgage of Lands.— A mortgage must be made under seal, and to be valid against subsequent purchasers or mortgagees for value without notice, should be registered in the registry office for the county in which the lands are situate. A short statutory form for mortgages is provided by the Revised Statutes of Ontario, cap. 107. The usual remedies of the mortgagee in default of payment are by sale under power of sale in the mortgage, or obtaining foreclosure by an action at law, in conjunction with which and in the same action an order for possession of the land and a judgment and execution on the personal convenant against the mortgagor generally may be obtained. The mortgagee has also the right to distrain on the goods of the mortgagor (not of any third person) fo/ arj lars of interest. When mortgages are paid, a formal discharge, which when registered recon^'.ys the land to the mortgagor, should be obtained. A receipt is not sufficient- See Interest. i'ARTNEUSHirs. — A partnership may be legally defined as a voluntary unincorporated association of individuals as principals for the carrying out of a joint operation or undertaking for the purpose of joint profit. A part owner is not necessarily a partner; nor is a servant a partner of his master, even where for his trouble and labor he gels part of the profits, or wages in proportion to the profits, he not being liable for losses. A dormant or sleeping partner is, when discovered, equally liable with those held out to the world ai partners. The liability of partners to third parties may be illustrated by the case of two horse dealers, who agreed in their articles of partnership, each with the other, that they would not warrant any horse that they might sell ; one did warrant a horse sound, and the horse being unsound, both partners were held liable to the victim, despite their agreement, because such warranty was within the scope of and incidental to their business. The most stringent good faith, iibcirima fides, is required of partners. Each partner has a right to an account at any time. A partnership may be dissolved by the death of one of the partners, by mutual consent, or by eflluxion of time. Dissolution will be decreed by the Court on the insanity of one partner, or where there has been wilful fraud, or where the particular object of the partnership becomes impracticable. A partnership become* dissolved by act of law on bank- ruptcy. Each partner's individual property is liable to the fullest extent for partnership debts, if the assets of the firm are insufficient to pay them. The importance of articles of partnership properly drawn up, providing for duration, division and dissolution, cannot be too strongly urged. Declarations of co-partnership should be registered within six months in the County Registry Office. — See R. S. 0., cap. 130 ; and see Joint Stock Companies below. Special or Limited Partnerships may be formed under Revised Statutes Ontario, Chapter 129, where there are one or more general partners whoie names are public, and who are liable to the full extent of their means, and whose death involves dissolution (unlike Joint Stock Companies) ; but also one or more special contributors to capital who must not interfere in the active manage- ment, and who must be registered as special, and whose iinV."ty in such case is limited to the amounts agreed by them to be contributed to the capital. Joint Stock Companies (Limited). — A Joint Stock Company (Limited) is a body corporate, created by letters patent, having a common seal, with a capital stock usually divided into shares, which are subscribed for by those desiring to become stockholders, and who are liable to creditors of the company only to the extent of the respective amounts remaining unpaid on the stock subscribed by them. Thus, if A, H, C and 1) agree to enter into an ordinary partnership with a capital of $10,000, and the business fails, each is liable personally to the full extent of the defici- ency of assets ; but if these same men form a limited company under A'. .S". O., cap. 157, or under the Dominion .Statute, for the same purpose, and with the same capital, and the business fail, and all of them but A have paid up their subscribed shares of the capital in full, and A has paid all l)ut$ioc, then A alone is personally liable to creditors of the company, and that only to the extent of $100. A comp.iny has an existence apart from the members comprising it, and is a sort of anonymous statutory partnership. Companies usually speak and act through their directors and authorized officers with their seal ; but contracts, bills, notes, cheques, etc., made by an agent or officer of the company, on behalf of the company, in general accordance with his powers, under the by-laws or charter of the company, are binding whhout the seal. Contracts with Municipal Corporations should always be under seal. For general and comprehensive informa- tion on this subject, see J. W. Johnson's "Joint Stock Company Bookkeeping," and page 186 in this book. See also Partnerships above. Powers oi" Attorney, see form further on. 1*1 n c its 258 Registrai'ION. — All instruments, deeds, mortgages, etc., affecting lands should be registered promptly in the Registry Office of the County where the lands lie ; otherwise they will not retain priority as against subsequent purchasers or mortgagees for value in good faith without notice. Unregistered instruments are good and effectual as belween the actual parlies Ko those instruments, but not as against innocent third parties who may obtain priority by prior registration, even though the grantor or mortgagor may be guilty of fraud. Leases, unless for seven years and upwards, need not be registered. Wills and grants from the Crown are registered in the manner set out in the Registry Act j8qj, Ontario Statutes, All otheri nstruments (including Powers cf Attorney) are registered by the production of the original (generally in duplicate), with an affidavit of execution made by a subscribing witness attached to each duplicate, care being taken that the witness gives \\\s full name, residence, atui occupation, and takes the oath before a competent officer, who is usually, in Ontario, a Commissioner, or Notary Public, or the Registrar ; in other Provinces, a Notary Public (with seal), or a Commissioner for Ontario ; and in Foreign countries a Mayor, Notary Public or British Consul, in all these latter cases the official seal being attached to the jurat of the affidavit. The following is a FORM OF AN AFFIDAVIT OF FXECUTION. County of Hastincs,^ I, William Nesiut Ponton, o/t/ie City of Belleville, in the Count)' To wit : I of Hastings, Barrister-at-lv'iV, make oa.h and say : — 1. That I was personally present, and did see the within Instrument and Duplicate duly sio;iiul, sealed and executed by John Wesley Johnson and William Byron Robinson, tivo of the ^artii: thereto. 2. '] HAT the said Instrument and Duplicate were executed at the City of Belleville. 3. That I personally know the said parties. 4. That / am a subscribing Witness to the said Instrument and Duplicate. {Sworn before me at the City\ of Belleville in the County of \ Hastings, this day of May, | in the Year of Our Lord 1894. / (.Signed), Wm. Hamilton Ponton, Ee^istrar Co. Hastings, (or) A Commissioner for taking affidavits, H. C. J. (or) Notary Public, (or)/. P. Rf'PLEViN. — When goods have been wrongfully distrained or taken, they may be replevied upon giving to the sheriff security in treble the value of the property to be replevied. This is tiie remedy sought where the object is speedily to recover the specific goods and not merely damajjesj for their loss. Security for Costs. — Where the plaintiff is resident out of the jurisdiction, and has not sufficient property in the jurisdiction, the defendant can require him to give security for the costs of the action, in the sum of $400.00. So also where the plaintiff is suing for a penalty, and where "man of straw " or nominal plaintiff acts for another without having any real interest in thecajse of action, Stoppage in transitu. — When it is ascertained by a consignor that a consignee, to whom he has sol( and shipped goods, has become insolvent, he may at any time, during transport and before delivery to the consignee or his assignee or agent, stop the delivery of such goods, and so avoid being obliged to rank on the insolvent estate with the general creditors at so much on the dollar Subrogation. — The right to stand in the place of another to or for whom money has been iegall) paid — generally in respect of insurance and other collateral securities Taxes are a charge on Real Estate, and the collector has the power to levy the amount by distraininj on goods on the premises, or on the goods of the person assessed within the municipality. Grea care should be taken in drawing a lease to provide clearly whether the landlord or tenant is to paj taxes, and what taxes. In purchasing land, arrears of taxes should be paid, and the Treasurer' certificate obtained before accepting title. Lands may be sold for taxes wh" are in arrear fu the third year, provided there is no sufficient distress on the premises. The right of the t£ collector to distrain has been limited by recent statutes. (Signed.) W. N. PONTON, A another, is made )uld be registered ihey will not retain ilh without notice. » those instrunant?, registration, even or seven years and tered in the manner ncluding Powers o( te), with an affidavit 3eing taken that the before a competent Registrar ; in (ither in Foreign countries 1 seal being attached levillc, in the Couiilj )uplicatc duly si»\iui, N, t'iVO of the />artiii '.ville. . N. PONTON. H. C.J. P. \y be replevied upon plevied. This is tlie not merely damap; and has not sufficient! for the costs of thel Denalty, and where al al interest in the cauieT , to whom he has soi ort and before deliverij and so avoid being h on the dollar, oney has been legall)! amount by di^traininfl I municipality. Gteaj lord or tenant is to i d, and the Treasurer j h' ' are in arrear foi The right of the uj 259 Tender.— The dehnite and actual offer of a specific sum of money in payment of a debt, made directly to the creditor in proper form. Tr ri.E.— In investigating titles, searches should be made at the Registry Office, the Sheriff's Office, the Treasurer's Office, and the Collector's Office, and, in the opinion of the writer, m one but a trained solicitor is competent to search a Title. Travellers. — See Common Carriers. Wills. --Wills may be made by any person, married or single, male or female, of the full age of twenty-one years. No will is valid unless it is in writing, signed by the testator at the foot or end thereof, or by some other person in his presence, and by his direction, and such signature must be made or acknowledged by the testator in the presence of two or more witnesses present at the same tinie, and such witnesses shall subscribe such will in the presence of the testator. No form of attestation is necessary. Creditors and executors are competent witnesses, but if any person attests the execution of any will, to whom or to whose wife or husband any bequest or devise is given, such bequest or devise shall be void, though such person shall be a competent person to prove the will. A will may be registered by production of the original will, and a true copy thereof, with an affidavit of a subscribing witness to the will as to its due execution, as to the death of the testator or testatrix, and as to the annexed copy being a true copy of the original, or by the production of the probate of the will with a verified copy, A will speaks only from the death of the testator. If no executor is named in the will, the court will appoint an administrator with the will annexed. If a person die without a will he is called an Intestate, and an adminis- trator will be appointed by the Surrogate Court to wind up the estate. A will is revoked by marriage, by cancellation and destruction, and by a subsequent will. A codicil or supplementary will requires to be executed with the same formalities, and all alterations and interlineations should be executed and witnessed in the same way as the will itself. See form of Will further on. This summary is not intended to be exhaustive, nor to take the place of large treatises or legal counsel, but rather to suggest points of practical importance to the student, and to form a basis for examination on subjects which are more elaborately treated in the lectures of the College. In all cases of doubt, consult a lawyer, whose business it should be to prevent rather than to create lawsuits, and tell him as much about your opponent's contention and position as you do about your own side of the question. "Nothing extenuate nor set down aught in malice," and you will get better advice and sounder sleep and have a more satisfactory balance sheet A litigious merchant commits mercantile suicide. You are invited to make application at any time to the lecturer for information on any point in law, either in the college or at his office. FORMS OF BUSINESS PAPERS AND EXPLANATIONS THEREON. The student will find it to his advantage to learn thoroughly the general laws , which govern Bills of Exchange, Notes, Drafts, etc., and to note closely the wording and form of all Business and Commercial Papers, as they represent, to a certain degree, the language of trade. An Act passed by the Canadian Parliament, and known as the "Bills of Exchange Act, 1890," constitutes the law relating to Bills I of Exchange, Cheques and Promissory Notes in Canada. BILLS OF EXCHANGE. A Bill of Exchange is an unconditional written order from one person to another, directing him to pay a third, a sum of money therein named, and usually the bill I » made payable not to the payee alone, but also to his order, or to the bearer. -i# 5«** 260 The person who makes the bill is called the drawer, the person to whom it is addressed the drawee, and the person to whom it is ordered to be paid the payee. When the drawee undertakes to pay the amount he is then called the acceptor. If the bill is made payable to the payee, or uearer, it may be transferred to a fourth party by merely delivering it into his hands, and the fourth parly will stand in the same situation as the original payee did. If the bill is payable to the payee, or ORDER, he cannot transfer it except by a written order usually on the back of the bill, called an endorsement, after which the payee is called the iNDORfiER, and the person to whom it is transferred the indorsee. Holder is a general word, applied to any one of the parties in possession of the bill, and entitled at law to receive its contents from another. A bill is either foreign or inland It is called foreign, when drawn by a person in one country upon a person in another country ; and inland, when both drawer and drawee reside in the same country. The latter is usually termed a draft, See page 62. Foreign bills are usually drawn in sets, — that is, copies of the bills are made separately, each part containing a condition that it shall continue payable only so j long as the others remain unpaid. Whenever any one of a set is paid, the others are void, for the whole set constitutes but one bill. The object in drawing them in sets is, that they may be sent at different dates, or by separate conveyances, that time mav be saved should one or more be lost. letters of credit. A Circular Letter of Credit is a Bill of Exchange carried by travellers on whicii they can obtain money in different countiies. A Letter of Credit is the written I authority from a banker to another banker, authorizing advances to be made to the| person named in the letter. FORM OF SET OF BILL OF EXCHANGE. I St hill of exchange, Bdkvilk, Ont, Canada, 12th May, 18^4. Exchange for ^85. Three days after sight of this my first of exchange (second and third of same datcl and tenor unpaid), pay to S. G. Beatty, or order. Eighty-five Pounds Sterling, value] received, and charge the same to account of W. B. ROBINSON. To George H. Simpson, Banker, London. 2ND hill of exchange. Exchange for ^85. Belleville, Out, Canada, 12th May, 18^4. Three days after sight of this my second of exchange (first and third of samei date and tenor unpaid), pay to S. G. Beatty, or order, Eighty-five Pounds Sterling] value received, and charge the same to account of W. B. ROBINSON. To George H. Simpson, Banker, London. 261 to whom it is id the PAYEE. ACCEPTOR. ansferred to a y will stand in ihe payee, or lack of the bill, and the person applied to any ve its contents ;n drawn by a nd, when both termed a draft, bills are made payable only so d, the others are ^rr them in sets I ;s, that time may /ellers on whicii it is the written be made to the Exrhange for ;^85. 3RD HILL OF EXCHANGE. Belleville, Out. , Canada, 12th May, 18^4. Three days after sight of this my third of exchange (first and second of same date and tenor unpaid), pay to S. G. Dcatty, or order, Eighty-five Founds Sterling, 1 value received, and charge the same to the acconnt of VV. B. ROHINSON. To George H. Simpson, Banker, London. The par value of Sterling l^Achange is $4,862/^, or 9'^ percent, over the old I par, which was $4 44,',. The rate of exchange is the price at which it is being bought land sold daily. PAR OF STERLING EXCHANGE EXPLAINED. Previous to gold coinage by the United States, the Spanish or Mexican dollar Iwas the standard unit of value upon the American continent, as the English pound Isterling was the unit of value in Great Britain. The equivalent of the pound sterling lin Mexican dollars was $4,4444, which was the then par of exchange, and is now Ireferred to as the " old par " of exchange, because it is not now used. When the lUnited States issued its coinage and made the gold dollar the standard unit of value, lit made the intrinr/ic value of the coin just 9^ per cent, less than the old Mexican Idollar. It became necessary, therefore, to arrive at its just value, to add 9>^ per (cent, to it, to make it the equivalent of the old Mexican dollar, and we thus have the [anomaly of 9 J^ per cent, advance, being the par of sterling exchange. Thus, $4.4444 nultiplied by .093^ gives 42.22 cents, which, added to $4. 4444, makes $4.8666, the [present equivalent in Canadian or United States currency. May, 1894- third of same datel Is Sterling, value| iBINSON. May, 1894. nd third of sanii Pounds Sterling, )BINSON. THE RATE OF STERLING EXCHANGE. The rate of sterling exchange is the price at which it is being bought and sold [rom day to day. The fall of the year is the period at which sterling exchange is nost plentiful, and therefore lowest and most favorable to the merchant or banker |(ho has to remit, as it is at that period that the largest shipments are made to Europe pm this continent. Against the shipments, b: .3 of exchange are drawn, which are [sually sold to the banks, who transmit them for payment to the drawees ; and the anks in turn sell their own bills drawn on their agents or correspondents, to those fho have to make remittances. The exports and imports of a country, it will be een, create exchange. Exchange is quoted either in dollars and cents (as $4.81!'^). or at a certain dvance on the old par (as io}A>,). The former is a low rate, being below par (4.86^) ; |ie latter is above par (gj^), general remarks. Any date may be inserted by the maker of a bill or negotiable instrument jhether past, present or future ; and the instrument is not invalidated by his ppacity at the time of the nominal date. <. 262 If a bill or note is dated forward of a day not arrived, and any of the parties die before that day, such death will be no bar to the remedy of a bona fide holder. It is no objection to a bill or note that it is dated on Sunday, for it does not follow that it was made on that day. A bill drawn on Sunday, founded upon a con- tract made on that day in the ordinary calling of a person making it, is void in tlie hands of a person who, with knowledge of the circumstance, took it from the person to whom it was given ; but it holds good in the hands of an innocent indorsee for value. Every bill or note must be signed by the person making it, or some one authorized by him for that purpose. It is not essential to the validity of a bill that it be negotiable, or that it contain the words " value received," although in many (indeed in most) cases it is highly important that these words be inserted. A bill or note may be issued with a blank for the payee's name, and any bona FIDE holder may insert his own name as payee, ^ut until the blank is filled up it is not a bill or note. PROMISSORY NOTES. A Promissory Note is a written promise to pay unconditionally and at all I events a specified sum of money. The person who makes the note is called the MAKER, and the person to whom it is payable the payee. A note, while in the hands of the payee, as this resemblance to a bill, that it is for the payment of money absolutely an ' all events, and when indorsed and transferred it is exactly similar to a bill of ex( . .;. The identity is complete as soon as the indorsement is made;! for then it is an order of the indorser upon the maker to pay the indorsee, which is I the very definition of a bill of exchange ; the indorser on a note is the same as thel drawer of a draft, the maker of a note the same as the acceptor of a draft, and thel indorsee the person to whom it is made payable. See forms of notes, page 65. Thel parties to a note are : the maker, the one who draws it ; the payee, the one in whosel favor it is drawn ; the endorser, the one who endorses it ; the endorsee, the one tol whom it is endorsed by name ; a third party is any one who holds it in due course ;| that is, obtained it before maturity, in good faith, and for value. REQUISITES OF A BILL OR NOTE. No particular words are necessary to make a bill or note ; but it must be written order or promise, which, from the time of making it, cannot be complied with or performed without the payment of money. Though a bill or note, or aij indorsement thereon, must be in writing, such writing need not be in ink. A writing in pencil is sufficient ; ink, however, is obviously more desirable. The exact sum for which a bill or note is given must be inserted, and it must bj for the payment of money, and money only, and the sum to be paid must be payablJ absolutely, and n? 1st .not depend upon any circumstances which may or may noj happen. A bill or note drawn for a given sum, " and all other sums that may be due t| the payee," is not, even between the original parties, a bill or note. Nor is it gooi for the sum it specifies, except as evidence of a debt. * (niissioner ^hich the bnally liJ pnd courJ A nc H to its| [eparatel]! wlcenor 263 the parties die IE holder, or it does not d upon a con- , is void in the :om the person nt indorsee for A variance between the sum superscribed in figures and that mentioned in the body of the bill in words at length will not render it uncertain, but the latter will prevail. The place where a bill is drawn should appear upon it ; and it should also be 1 dated. PARTIES TO A BILL OR NOTE. A bill or note cannot properly be made or indorsed by, nor can a bill be properly addressed to, any person incapable of making himself responsible for the payment, nor should it generally be made payable or indorsed to any person incapable of suing. Therefore, a bill or note cannot properly be made or indorsed by, nor can a bill be properly addressed to, an infant (a person under age), except, perhaps, where it is drawn, indorsed or accepted for necessaries. As an infant is capable of suing, he may be payee or indorsee. But it may be iiuestionable, in some cases, whether payment should not be made to his guardian. Bills or notes cannot properly be made, indorsed or accepted by a married woman, unless under peculiar circumstances, where she holds separate property of her own, or acts by authority from her husband ; or where she resides here, and he is jnally and at all | under a civil incapacity of being in this country. Dte is called the ;, or some one r that it contain xses it is highly :, and any bona is filled up it is hile in the hands ] lyment of money exactly similar to I rsement is made; ndorsee, which is i the same as the f a draft, and the s, page 65. The the one in whose orsee, the one tol it in due course ;| but it must be annot be complied bill or note, or an in ink. A writing ted, and it must bJ id must be payabl] may or may hat may beduet| )te. Nor is it goo Where a bill or note is given to a single woman, and she marries, the property technically vests in her husband, unless clearly her separate estate ; and husband and wife must usually join in the action upon it. If a note be made to a woman after siARRiAGF., the interest vests in the husband. If a single woman, being a party liable on a note, marries, her husband becomes lesponsible to the extent of the property which has come from her into his hands, and they may be sued jointly. If (the debt being still unsatisfied) he dies, she is liable, and not his executors ; if she dies, her representatives are liable if there be assets, but not her husband. In Ontario, under the Act of 1884, married women can deal with their separate estate as though they were single. The contracts of a lunatic, an idiot, or other person non compos mentis from age or personal infirmity, are utterly void. A note obtained by fraud, or duress, or from a person in state of total drunk- jness cannot be collected by a party who knew the circumstances when he took it. If persons who fill official situations, as church wardens, overseers, surveyors, com- |niissioners, managers of joint stock companies, and the like, give bills or notes on hich they describe themselves in their official capacity, they are nevertheless per- sonally liable, unless exempted from liability by statute, or by the charter, By-Laws nd course of dealing of the Company. JOINT NOTES. A note by two or more makers may be either joint, or joint and several, accord- ing to its form. The makers of a joint note should be sued jointly ; for if sued Separately the action may be defeated or delayed, owing to the non-joinder of the other Baker 1 or makers. If one of the parties to a joint note be insolvent, or out of 264 •»i!«r ■»«««,' the country when the note falls due, it may be collected from the other. The maki s of a joint and several note may be sued upon it, either jointly or separately ; and i| sued separately a recovery of judgment (without satisfaction) against one will not be a bar to recovery against another maker. A note signed by more than one person, and beginning, " We promise," etc., is a joint note only. A joint and several note usually expresses that the makers jointly and severally promise. 15ut a note signed by more than one person, and beginnini;, " I promise," etc., is several as well as joint. So a note beginning in the singular, "I promise," etc., and signed by one partner for his co-partners, is the joint note of all, and has been held to be also the several note of the signing party. A joint and several note, though on one piece ot paper, comprises in reality, ami in legal effect, several notes. 'Jhus, if A, B and C join in making a joint and several note, there are, in effect, four notes. There is the joint note of the three makers and also the several notes of each. OF THE ALTERATION OF BILT.S OR NOTES. Correcting the date or the mode of its negotiability, to make it what it was intended v-'\\\ not affect a bill or note, if done by the maker. An alteration of a bill or note in a material p.irt invalidates the bill or note, except as between the parties consenting to such alteration. ■T ierting a mere memorandum to say where the bill or note is to be payable, if I it give a right direction in that respect, or correcting the address or style of the [ drawee, so as to make it accord with the acceptance, will not affect a bill. But altering an acceptance so as to give an unwarranted place for p.ayment invalidates the | acceptance. Altering a place where a bill or note is payable, if for a fraudulent purpose, may | be punishable as a forgery. Cutting off from a joint and several note the name of one of the parties who has! executed it will invalidate the note. If a bill or note appear upon the face of it to have been altered, it is for tlie| holder to prove that it was altered under circumstances which make it still available. The payment of interest upon it by the party chargeable will suffice for this] purpose. When paying a note or acceptance you should, if it has not been done already, obtain the indorsation of the payee upon it, as proof that you both gave the note and | paid it. OF THE OBLIGATIONS OF PARTIES. The drawer's undertaking in a bill of exchange is that the drawee, upon due presentment to him, shall accept such bill, and pay the same when due ; and that ifj the drawee do not accept it, or pay it when due, he will pay the amount of the bilU together with certain damages allowed by law ; provided he is duly notified of such] non-payment. It is the payee's duty, if the bill remain in his possession, to present it to the! drawee for acceptance and for payment at the proper time and place ; and in easel No llHNT is Its effect |ndorser i Whei pe drawe pve been |ny one oi Qfif) The makes itely ; and it will not be a lise," etc., is nakers jointly nd beginniiv^, the singular, joint note of in reality, and )int and several ree makers ;ind it whai it was e bill or nolo, be payable, if | 1 or style of the i :ct a bill. But' It invalidates the | :nt purpose, may parties who has | red, it is for the I it still available. suffice for this] the drawee refuse to accept, or pay, to give notice without delay, to the drawer, of such refusal. The acceptor undertakes and is bound to pay the bill, acxording to the tenor of the acceptance, when it becomes due, and upon due presentment thereof. In short, all those who have sigiii d, accepted, or indorsed a bill of exchange are jointly and severally liable upon it to the holder. The acceptor is considered, in all cases, as the party primarily liable on the bill. He is to be treated as the princijjil debtor to the holder, and the other parties as sureties liable on his default. The acceptor of a bill stands, for most purposes, in the same situation cs the maker of a note, and the drawer of a bill in the situation of the indorser of a note. The acceptor's liability can only be discharged by pa)mcnt, or other satisfaction, by release, or by waiver. INDORSEMKNT. A person who writes his name upon a bill or note otherwise than as a maker or acceptor, and delivers it with his name thereon to another person, is called an indorser, and his act is called an indorsement. The proceedings to be taken to hold an in- dorser liable on a note, or the drawer liable on a bill, if not paid at maturity, are explained under the head of Protests. Indorsements are of two sorts : hlank and kuli, or si'Kci.m. indorsements, and are always written ujipn the back Special indorsements are modified in different ways, as shown in the following: KOKMS 01' INPORSEMENT. 1.— Indorsement in lilaiik. /o/in A. Fiiiscr. |:.-Imlorsement in full. Pay to John A. Fi\tscr, or order S. G. Bah'K -Qualified Indorsement. IVil/ioiif recourse to me. S. G. Baker. -Restrictive Indorsement. Pay to John Smith only. S. G. Baker. Or tfie following may l)e used : Pay to John Smith or order for my use. Pay to Jolin Smith Jor my account. Pay to IV. y. Osliorne for account of A. C. Baker. 5. — Guarantee on a note. For value received I hereby guarantee the pavment of the within note. S. G. Baker. G. — Indorsing partial payments on a note. Date. A'eceived on the loithin note the. sum oj Twenty -Jive Dollars. en done already, ■ When sending cheques to the bank for deposit by a clerk, write " For Deposit ave the note andBo«/y" above the signature when indorsing. This will prevent a possible attempt to [draw the money. No particular form of words is essential to any indorsement. A ul.'Vnk indorse- IKNT is made by the mere signature of the indorSer on the back of the bill, as above ; Its efiTect is to make the instnmient thereafter payable to bearer, and it places the indorser in the position of surety for the maker. When several persons separately indorse a bill, in blank, and it is dishonored by ""i-'fied of suchBlie drawer, the payee or holder has a right of action against all the indorsers, if they lave been duly notified of dishonor, and he may sue and recover the amount from . -^ f^ tlieB^y o"e of them, present it to tne j ace ; and in caser rawee, upon duel due ; and that if| lount of the bi! 96« lr|» c ff«»v The maker of a note is the principal debtor, and all the indorsers are sureties for him, liable on his default. JUit though all the indorsers are, in respect ok thk MAKER, sureties, they are not, as between themselves, merely c ireties, but eai h prior i)arty is a principal in respect of each subsequent \wVy. Kor example, suppose a note to be indorsed by the payee and two subsequent Imo •-sers • as between the holder and maker, the maker is the principal debtor, at the indorsers are his sureties, lint as between the indorsers, ihe first indorser is the [)rincii.al debtor, and the subsequent indorsers are his sureties. A discharge, therefore, to the prior parties is a discharge to the subsequent parties, bu'. a discharge to the subsequent parties is not a discharge to the prior parties. In case of an indorsement where parties become co-sureties, an indorser who pays a bill has a right to reimbursement from his co-sureties, in proportion to tlieir number. Thus, if A, B and C be co-sureties. A, having paid the debt, would be entitled to recover at law a third from each of the others. An indorsement in kull makes the instrument payable to the indorsee or his order ; and he cannot transfer it otherwise than by indorsement. A qualified indorsement is given to make a bill negotiable, without incurring personal responsibility on the part of the indorser. A resvrictive indorsement is a restrictive direction appended to the indorsee's name, so that, into whose hands soever the bill may fall, it will carry a trust on the face of it. If a person, at the time a note is made, write on the back of it, " I guarantee the payment of the within note," he will be treated as a joint and several promissor with the maker thereof, and not as a mere guarantor. But if the indorsement be made at a subsequent time, or be a guarantee of collection instead of payment, the indorserl would be considered as a guarantor ; a consideration, however, in these last cases should be expressed. If a note be endorsed thus, " For value received I guarantee the collection of the within note," the guarantor would not be liable upon it unless] the holder showed a diligent attempt to collect it. A bill or note cannot be indorsed for part of the sum remaining due upon it. the bill has been partly paid, it may be specially indorsed for the part remaining du( upon it. An indorsee has a right to convert a blank indorsement into a special one b] writing over the signature the necessary words. OF THE TRANSFER OF BILLS AND NOTES. Ace Ihe bill, necessarj sufficient An i Jcertain si ance by 1 Abi ince or p The My accor lion. If le may trj [0 procure Ipon the Bills and notes are divided into two classes — Negotiable and Non-negotiable. Negotiable paper is that, the ownership of which may be freely transferred froi one to another, giving the holder the right of action, without being subject to ai offsets or legal defences existing between the original parties, if transferred befoi maturity for a valuable consideration, and received l>ona fide without any defei therein. Negotiable paper is made payable to the order of the payee, to the payee ■ ' ^ ^^' order, to the payee or bearer, or to the bearer, or some other term of similar impo^ ^' ^ b showing that the maker intends to give the payee the right of transfer. The ount uj ty of thJ *, the bil ke a d| omes dl ; sureties for ECT OK TlIK ics, but eat h iple, -suppose between ihe irsers are his il debtor, and e prior parlies uent parties is I indorser whd ortion to llieir lebt, would be indorsee or his rithout ir\currinR to the indorsee's i ^ a trust on the 207 Non-negotiable paper is that which is made payable to the person therein named, without authority to transfer it to a third party. It may be transferred from one to another by assignment, but it remains subject to all oflsets and legal defences existing between the original parties. The title to negotiable paper passes from one to another by delivery, if made |)ayable to the payee or bearer, or to the bearer ; and by indorsement and delivery, if made payable to order of payee, or to payee or order. A transfer by mere delivery, without indorsement, of a bill or note made payable to the bearer, does not render the transferer liable. A transfer by delivery, however, warrants that the bill or note is not forged or fictitious. PRESENTMENT OF A BILL FOR ACCKl'TANCE. Presentment for acceptance is necessary, if the bill be drawn payable at sight or at a certain period after sight or after date. Till such presentment, there is no right of action against any party ; and generally, unless it be made within a reasonable time, the holder loses his remedy against the antecedent parties. Presentment should be made during the usual hours of business. ACCEPTANCE. " I guarantee theB Accei-tanck, in its ordinary signification, is an engagement by the drawee to pay al promissor withBihe bill, when due, in money. It must be in writint^, though no precise form is ement be made atBnecessary ; any written words clearly denoting an intention to accept the bill are lENT the indorsetB sufficient. See page 63. these last casesB An instrument drawn by A upon B, recjuiring him to pay to the order of C a eived I guaranteeBcertain sum at a certain time, is a hill of exchange or urait, but after its accept- e upon it unlessBance by B it is usually called an acceptance. A bill is said to be honored when it is duly accepted or paid ; and when acccpt- ince or payment is refused, it is said to be dishonored. The holder is entitled to recjuire from the drawee an absolute engagement to lay according to the tenor of the bill, unincumbered with any condition or ciualifica- lion. If the drawee refuse to give the holder a general and unciualified acceptance, le may treat the bill as dishonored. Notice must be given of a failure in the attempt |o procure an acceptance; otherwise, the person cuilty of neglect may lose his remedy pon the bill. g due upon it. art remaining M a special one bj PRESENTMENT FOR PAYMENT. ES. Non-negotiable. sly transferred uoi« r^^^ contract of the acceptor of a bill, or the maker of a note, being to pay the ;ing subject to ^m,Qyj^^ ^p^^^ ^j^^ presentment at maturity, in order to charge the indorsers, it is the transferred "^°Mity of the holder to demand payment of the maker on the very day on which, by without any ^^^», the bill becomes due; and unless the demand be so made, the holder loses his imedy against the endorsers, although the maker would still be liable, ee, to the pay ■ j^ ^ ^.jj ^^ ^^^^ ^^ ^^^^ payable at a particular place, the holder is bound to |m of simi ar imp ■ ,^^ ^ demand of payment at that place. In determining when a bill or note sfer. womes due, 3 days of grace, as they are called, must be allowed. For example, a m •'t§ tor S«kv.. 268 note drawn or a bill accepted payable two months from February 5 would not be legally due till April 8. When a bill is drawn " on demand," or if no time of payment be specified upon its face, it must be paid on presentation, no grace being allowed. Bills or notes made payable at a bank are generally left with that bank for collection. If a bill or note is payable generally, without any specification of place, the holder may present it for payment to the acceptor or maker, wherever he may be found. PROCEEDINGS ON NON-PAYMENT. * No protest is required to be made upon the dishonor of a bill or note, if it is still held by the original payee in case of a note, or the original payee of a bill if he be also the drawer, although it is common to protest them for non-payment, especially in commercial towns. But in every case of the dishonor of a bill or note, it h the duty of the holder to give due notice thereof to all the prior parties on the note to whom he means to look for payment ; for the holder cr.nnot recover against an endorser to whom he has failed to give due notice of the dishonor. PAYMENT. If the maker i)ays a bill or note to a bona fide holder, it will amount to a complete discharge of all other parties thereon. But when payment is made by an indorser, such indorser, as a general rule, will retain his right to recover over against all the antecedent parties to the instrument until he has received a full indemnity; S!:ch payment, generally, discharges all the indorsers subsequent to himself. The party paying a bill or note has a right to insist on its being delivered up to him. A party paying any debt has a right to demand a receipt for the same, and the p3lft„st» Lease of House. This Indenture, made the day of A.D. 18 Setween Witnesseth, that in consideration of the rents, covenants and agreements hereinafter reserved and contained on the part of the said part of the second part, executors, administrators and assigns, to be paid, observed and performed the said part of the first part ha demised and leased, and by these presents do demise and lease unto the said part of the second part, executors, administrators and assigns, all that messuage or tenement situate, lying and being , together with all houses, outhouses, yards and other appurtenances thereto belonging or usually known as part or parcel thereof, or as belonging thereto : To have and to hold the said premises unto the said part of the second part executors, administrators and assigns, for and during the term of to be computed from the day of ,18 , and from thenceforth next ensuing, and fully to be complete and ended ; yielding and paying therefor yearly and every year during the said term hereby granted, unto the said part of the first part, heirs, executors, administrators or assigns, the sum of to be payable on the following days and times, that is to say : The first of such payments to become due and be made on the day of next, and the last of such payments to be made in advance on the day of preceding the expiration of the said term Provided always, and these presents are upon this express condition, that if the said yearly rent hereby reserved or any part thereoflf, shall at any time remain unpaid for the space of twenty- one days, after any of the days on which the same shall become due and payable, or if a breach or default shall be made in any of the covenants hereinafter contained by the said part of the second part, executors, administrators or assigns, then and in every such case it shall be lawful for the said part of the first part, heirs, executors, adminstrators or assigns, 271 under senl. )ans. See entures and isive ; lerein, and a if any ay be varied, PTS, pages 6 1 nd agreements of the paid, observed sed and leased, of the It messuage or ises, outhouses, part or parcel of the during the term , i8 , and ; yielding and anted, unto the ministrators or into and upon the said premises or any part thereof in the name of the whole, to re-enter, and the same to have again, repossess and enjoy, as if these presents had never been executed ; and the said part of the second part, for heirs, executors, administrators or assigns, do hereby covenant, promise and agree to and with the said part of the first part, heirs, executors, administrators and assigns ; that the said part of the second part, executors, administrators and assigns, shall and will well and truly pay or cause to be paid to the said part of the first part, heirs, executors, administrators or assigns, the said yearly rent hereby reserved, at the times and in the manner hereinbefore appointed for the payment thereof ; And also, shall and will, from time to time, and at all times during the said term, keep in good and sufficient repair the said premises hereby demised, reasonable wear and tear and accidents by fire and tempest excepted; And the same, so kept in repair, shall and will at the end, expiration or other sooner termination of the said term, peaceably and quietly yield and deliver up to the said part of the first part, heirs, executors, administrators or assigns ; And also shall and will well and truly pay or cause to be paid all taxes, rates, levies, duties, charges, assessmf^nts and impositions whatsoever, whether parliamentary, local or otherwise, which now are or which during the continuance of this demise shall at any time be rated, taxed or imposed on or in respect of the said demised premises, or any part thereof; And also, that it shall be lawful for the said part of the first part, heirs executors, administrators and assigns, and their agents respectively, either alone or with workmen or others, from time to time, at all reasonable limes in the daytime during the said term, to enter upon the said demised premises, and every part thereof, to view and examine the state and condition thereof, and in case any want of reparation or amendment be found on any such examination, the said part of the second part, executors, administrators or assigns, shall and will from time to time cause the same to be well and sufficienMy repaired, amended and made good within one month next after notice in writing shall have been given to or left at or upon the said hereby demised premises for that purpose ; And if the said part of the second part, executors, adminis- trators or assigns, shall fail in making the necessary repairs in manner hereinbefore described, that it shall be lawful for the said part of the second part, heirs, executors, administrators and assigns, and agents, to enter into and upon the said hereby demised premises, and have the same repaired in a proper manner, and to render the account for such repairs to the said part of the second part, executors, administrators and assigns, and demand payment for the same, and if owing days a ■ ^^^^^-^^ jg made, to sue for the same in any court of law, having jurisdiction over the same ; day idvaace on the And the said part of the second part, executors, administrators or assigns, shall not, nor will at any lime or times during the continuance of this demise, m Bsell, assign, let or otherwise part with this present lease, or the said premises hereby ondition, that if ■ demised, or any part thereof, to any person or persons whomsoever, for the whole or any time remain! any part of the said term, nor alter, change or remove any part of the said premises, yards or offices, externally or internally, without the license or consent in writing of the said part of the first part, heirs, executors, administrators or assigns, from time to time first had and obtained : And the said part of the first part, for heirs, executors, administrators and assigns ; covenant with the said pan of the second part, executors, which the same] e in any of the part, 3# lall be lawful for | Irators or assigns, , 272 administrators and assigns, that the said part of the second part, executors, administrators and assigns, well and truly paying the rent hereinbefore reserved, and observing, performing and keeping all the covenants hereinbefore c(n- tained, shall and may from time to time, and at all times during the said term, peace- ably and quietly enjoy the said premises hereby demised without molestation or hindrance : And if the term hereby demised shall at any time be seized or taken in execution, or in attachment by any creditor of the pa.ty of the second part, or if the said party of the second part shall make any assignment for the benefit of creditors, or being bankrupt or insolvent shall take the benefit of any act in force for bankrupt or insolvent debtors, the then current rent shall immediately become due and payable, and said term shall immediately become forfeited and void, but the next current rent shall nevertheless be at once due and payable. In witness whereof, etc. Signed, sealed, etc. Shout House I-ease. This Indent are f made the day of A. 1). iS , in pursuance of the Act respecting Short Forms of Leases, lietween , hereinafter called the lessor of the first part, and hereinafter called the lessee of the second i)art, Witnessethf that in consideration of the rents, cor^'aants and agreements hereinafter reserved and contained on the part of the said lessee, executors, administrators and assigns, to be paid, observed and performed, he the said lessor ha demised and leased, and by these presents do demise and lease unto the said lessee, executors, administrators, and assigns, all th certain together with all the rights, members and appurtenances whatsoever to the said premises belonging or appertaining. To have and to hold the said demised premises, with their appurtenances, unto the said lessee, executors, administrators and assigns, for and during the term of to be computed from the day of > i8 , and from thenceforth nex. ensuing, and fully to be completed and ended, yielding and paying therefor yearly and every year, during the said term hereby granted unto the said lessor, heirs, executors, administrates or assigns, the sum of dollars of lawful money of Canada, to be payable on the following days and times, that is to say : on the days of and in each year during the| said term, the first of such payments to become due and be made on the day of next, and the last of such payments to be made in advance on the| day of payment of rent, next preceding the expiration of the said term. And the said lessee covenant with the said lessor to pay rent : and to payl taxes : and to repair (reasonable wear and tear, and accidents by fire or tempestj excepted) : and to keep up fences, and not to cut down timber : and that the said] lessor may enter and view the stale of repair, and that the said lessee will repair according to notice, and will not assign or sub-let without leave : and will not carr\j on any business that shall be deemed a nuisance on said premises : and that he wi leave the premises in good»repair : And also that if the term hereby granted shall be at any time seized, or taken it execu shall insolv insolv full ar that il occupi said le shall ( propor Pi of cove The sa Ih Si| Knon Th Ontario, penal su said Ro which p adminisi first day ninety-t Th( bounder [ truly paj I administ payment I obligatio Sijr; ir The is given, A lending, Office, t\ * iJebenl 273 i part, ; hereinbefore einbefore ccn- id term, peace- nolestation or ;n in execution, :he said party itors, or being r bankrupt or come due and but liie next , in pursuance rt, and and agreements executors, the said lessor d lease unto the lU th certain ! inces whatsoever ir appurtenances, and during tlie 1 8 , and from ading and paying ted unto the said dollars of d times, that is to year during lhe| e on the n advance on tlie| rm. rent : and to pay! )y fire or tempestl and that the saidl lessee will repairT and will not carr\| : and that he will seized, or taken iij execution, or in attachment by any creditor of the said lessee, or if the said lessee shall make any assignment for the benefit of creditors, or becoming bankrupt or insolvent, shall take the benefit of any Act that may be in force for bankrupt or insolvent debtors, the said term shall immediately become forfeited and void, and the full amount of the current rent shall be at once due and payable : and also, that if the said premises be destroyed, or so much injured as to become unfit for occupation by fire or other casualty not caused by the wilful default or neglect of the said lessee, executors, administrators or assigns, the said term hereby demised shall cease, and the current rent shall he duly apportioned and the due proportionate part thereof shall be .^ once due and payable. Proviso for re-entry by the said lessor on non-payment of rent or nonperformance of covenants, or seizure or forfeiture of the said term for any of the causes aforesaid. The said lessor covenant with the said lessee for quiet enjoyment. Ill witness whereof, etc. Signed, sealed, etc. FORM OF A BOND.* Know all inert by these Presents : Th: i. I, John Smith, of the town of , in the county of- and Province of Ontario, am held and firmly bound unto Robert Jones, of the town of, etc., in the penal sum of twelve hundred dollars of lawful money of Canada, to be paid to the said Robert Jones or his certain attorney, executors, administrators or assigns, for which payment well and truly to be made I bind myself, my heirs, executors and administrators forever firmly by these Presents. Sealed with my seal and dated this first day of December, in the year of Our Lord one thousand eight hundred and ninety-two. The condition of the above written bond or obligation is such that, if the above I bounden John Smith, his heirs, executors and administrators do and shall well and truly pay or cause to be paid, unto the above named Robert Jones, his executors, administrators or assigns, the just and full sum of six hundred dollars, in three annual payments from the date hereof, with annual interest at nine per cent, then the above I obligation to be void ; otherwise to remain in full force and virtue. Signed, sealed and delivered in the presence of JOHN SMITH. Geo. Sherry. Seal. BOOK-KEEPING ENTRIES FOR MORTGAGES. The man who gives a mortgage is called the mortgagor, and the one to whom it |is given, the mortg?gee. A borrows from B $iooo, and gives as security a mortgage on land. Before [lending, B or his solicitor ascerfiined three things : first, by a search in the Registry lOffice, that A is the ov/ner, and that there are no prior mortgages ; second, by a visit * Debentures also get the name of Uonds. 274 to the Treasurer's ofifice, that the taxes have been paid ; third, by going to the Sheriff's office, that there are no judgments against the land. The mortgagor's entry for the transaction is : Cash Dr. $icoo.oo To Mortgage Payable $1000.00 The Mortgagee's entry is : Mortgage Receivable Dr. $1000.00 To Cash $1000.00 The mortgage is bearing interest at 6 per cent, and is to be paid in five annual instalments, $200 of principal each year, and interest on the unpaid principal. At the end of the first year, therefore, $260 is paid ; that is $200 of principal, and $60 for interest. The mortgagor's entry is : Mortgage Payable Dr. $200.00 Interest " 60.00 To Cash $260.00 The Mortgagee's entry is : Cash Dr. $260.00 To Mortgage Rec. 200.00 " Interest 60.00 A bought a piece of land from B for $4000, and paid down $2000, and gave a mortgage for $2000. A's entry is : Real Estate Dr. 4000.00 To Cash 2000.00 " Mortgage Payable 2000.00 -B's entry is : Cash Dr. 2000.00 Mortgage Rec. Dr. 2000.00 To Real Estate 4000,00 MORTGAGE, COMMON FORM. ThH Indenture f made (in duplicate) the day of A. D,| 18 , in pursuance of the Act respecting Short Forms of Mortgages, Jietween hereinafter called the mortgagor of the first part : his wife of the second part ; and hereinafter called the mortgagee, of tlie| third part : Witnesseihf that in consideration of of lawful money of Canada,! now paid by the said mortgagee to the said mortgagor (the receipt whereof is hereby acknowledged,) the said mortgagor do grant and mortgage unto the said mortgagee heirs and assigns for ever : All and singular the certain parcel or tract of land and premises situate! lying and being tlie said parly of the second part hereby bars her dower in \hi said lands. Provided this mortgage to be void on payment of lawful money ol Canada, with interest at per cent, per annum, as follows : — and taxes atK] performance of statute labour. the Sheriff's DOO.OO ooo.oo in five annual principal. At cipal, and $60 $260.00 200.00 60.00 000, and gave a 2000.00 2000.00 4000,00 of A. I). rst part : mortgagee, of thel money of Canada,! receipt whereof ij gage unto the saiil premises situate! s her dower in m lawful money oj and taxes ani 275 The said mortgagor covenant with the said mortgagee that the mortgagor will pay the mortgage money and interest, and observe the above proviso. That the mortgagor ha a good title in lee simple to the said lands ; and that he ha the right to convey the said lands to the said mortgagee ; and that on default the said mortgagee shall have quiet possession of the said lands, free from all encumbrances. And that the said mortgagor will execute such further assurances of the said lands, as may be requisite. And that the said mortgagor ha done no act to encumber the said lands. And that the said mortgagor will insure the buildings on the said lands to the amount of not less than dollars currency. And the said mortgagor do release to the said mortgages all claims upon the said lands, subject to the said proviso : Provided that the said mortgagee in default of payment for months, may, upon giving notice in writing, enter upon and lease or sell the said lands ; provided that the mortgagee may distrain for arrears of interest ; provided that in default of the payment of the interest hereby secured the principal hereby secured shall become payable ; provided that until default of payment the mortgagor shall have quiet possession of the said lands. In witness whereof, etc. Signed, sealed, etc. ASSIGNMENT OF MORTGAGE. This Indenture^ made (in duplicate) the day of A. D. 18 , between hereinafter called the '• Assignor " of the first part and hereinafter called the " Assignee " of the second part Whereas f by a mortgage dated on the day of 18, did grant and mortgage the land and premises therein and hereinafter described to heirs and assigns, for securing the payment of and there is now owing upon the said mortgage Now this indenture witnesseth, that, in consideration of of lawful money of Canada now paid by the said Assignee , to the said Asssignor (the receipt whereof is hereby acknowledged) the said Assignor do hereby assign and set over unto the said Assignee , executors, administrators and assigns all that the said before in part recited mortgage, and also the said sum of now owing as aforesaid together with all moneys that may hereafter become due or owing in respect of said mortgage and the full benefit of all powers and of all covenants and provisoes contained in said mortgage. And also full power and authority to use the name or names of the said Assignor heirs, executors, administrators or assigns for enforcing the performance of the covenants and other matters and things contained in the said mortgage. And the said Assignor do hereby grant and convey unto the said Assignee heirs and assigns, all and singular to have and to hold the Said mortgage and all moneys arising in respect of the same and to accrue thereon, and also the said land and premises thereby granted and mortgaged to the use of the said Assignee hei. -, executors, administrators and assigns absolutely forever ; but subject to the terms contained in such mortgage. m ;.^, . 270 And the said Assignor for heirs, executors, administrators and assigns do hereby covenant with the said Assignee heirs, executors, administrators and assigns, that the said mortgage hereby assigned is a good and valid security and that the sum of is now owing and unpaid, and that ha not done or per- mitted any act, matter or thing whereby the said mortgage has been released or discharged, either partly or in entirety ; and that will upon request do perform and execute every act necessary to enforce the full performance of the covenants and other matters contained therein. In witness, etc. 'rtj Dominion of Canada, STATUTORY DISCHARGE OF MORTGAGE. PROviNCii OF Ontario, | To WIT : ) To the lieffistrar of the do certify that ha satisfied all money due on or to grow due on a certain mortgage made by which mortgage bears date the day of A. D. 1 8 , and was registered in the registry office for the on the day of A. D. i8 , at minutes past o'clock noon, in Liber for as No. and that such mortgage has been assigned [Here state whether mortgage assigned or not.] And that I am the person entitled by law to receive the money ; and that such mortgage is therefore discharged. Witness my hand this Witness : Ontario : County of To WIT dav of A. D. i8 I, of the of in the county of make oath and say : 1. That I was personally present and did see the within certificate of discharge of mortgage duly signed and executed by the part thereto. 2. That the said certificate of discharge of mortgage was executed at 3. That I know the said 4. That I am a subscribing witness to the said certificate of discharge of mortgage. Sworn before me at ^ in the county of this day ot A. D. iS . A Comm., etc. I BILL OF SALE. (Chattels.) This Indenture, made the day of A, D. 18 , Between , of the of , in the county of (hereinafter called 1 the bargainor) of the first part, and , of the of , in the| county of (hereinafter called the bargainee) of the second part. WheveaSf the said bargainor is possessed of the goods, chattels and personal I effects, hereinafter set forth, described, and enumerated, and hath contracted and agreed with the said bargainee for ihe absolute sale to him of the same, for the sum 277 ind assigns trators and ly and that one or per released or request do ince of the satisfied all which ;istered in the ' ,at as No. ither mortgage ve the money ; ite of discharge ed at of discharge of 18 , Between hereinafter called , in the lart. ttels and personal contracted and same, for the sum h of dollars, and these presents are intended to carry out such contract and agreement, now this indenture witnesseth, that in pursuance of the said agree- ment, and in consideration of the sum of dollars of lawful money of Canada paid by the said bargainee to the said bargainor, at or before the scaling and delivery of these presents, (the receipt whereof is hereby acknowledged) he, the said bargainor hath bargained, sold, assigned, transferred and set over, and by these presents doth bargain, sell, assign, transfer and set over unto the said bargainee, his executors, administrators and assigns, all those the said goods, chattels and personal effects, hereinafter described, that is to say ; {description of goods) all which said goods, chattels and effects are now in the possession of the bargainor, and are situate, lying and being on, upon and about {description of premises where the goods are) ; and all the right, title, interest, property, claim and demand whatsoever, both at law and in equity, or otherwise howsoever, of him the said bargainor of, in, to, and out of the same, and every part thereof : to have and to hold the said herein- before assigned goods, chattels and effects and every of them and every part thereof, with the appurtenances, and all the right, title and interest of the bargainor thereto and therein, as aforesaid, unto and to the use of the said bargainee, his executors, administrators and assigns, to and for his and their sole and only use for ever : AND the said bargainor doth hereby, for himself, his heirs, executors and administrators, COVENANT, PROMISE and agree with the said bargainee, his executors and adminis- trators in manner following,, that is to say ; that he the said bargainor is now rightfully and absolutely possessed of and entitled to the said hereby assigned goods, chattels and effects, and every of them, and every part thereof; and that the said bargainor now has in himself good right to assign the same unto the said bargainee, his executors, administrators and assigns, in manner aforesaid, and according to the true intent and meaning of these presents ; and that the said bargainee, his executors, administrators and assigns, shall and may from time to time, and at all times hereafter, peaceably and quietly have, hold, possess, and enjoy the said hereby assigned goods and chattels and every of them, and every part thereof, to and for his and their own use and benefit, without any manner of hindrance, interruption, molestation, claim or demand whatsoever of, from or by the said bargainor, or any person or persons whomsoever : and that free and clear, and freely and absolutely released and discharged, or otherwise, at the costs of the said bargainor, effectually indemnified from and against all former and other bargains, sales, gifts, grants, titles, charges, and encumbrances whatsoever : and moreover that he the said bargainor and all persons rightfully claiming or to claim any estate, right, title, or interest of, in or to the said hereby assigned goods, chattels and effects, and every of them, and every part thereof, shall and will from time to time, and at all times hereafter upon every reasonable request of the said bargainee, his executors, administrators or assigns, but at the cost and charges of the said bargainee make, do and execute, or cause or procure to be made, done and executed, all such further acts, deeds and assurances for the more effectually assigning and assuring the said hereby assigned goods, and chattels unto the said bargainee, his executors, administrators and assigns, in manner aforesaid, and according to the true intent and meaning of these presents, as by the said bargainee, his executors, administrators or assigns, or his or their counsel shall be reasonably advised or required. In witness, etc. Signed, sealed, etc. 278 CHATTEL MORTGAGE. This Indenture, made (in duplicate) the day of one thousand eight hundred and , Between hereinafter called the mortgagor of the first part, and hereinafter called the mortgagee of the second part WITNESSETH, that the mortgagor for and in consideration of dollars of lawful money of Canada to in hand well and truly paid by the mortgagee at or before the sealing and delivery of these presents (the receipt whereof is hereby acknowledged) hath granted, bargained, lold and assigned, and by these presents doth grant, bargain, sell and assign unto the m j«:tgagee executors, adnvnistrators and assigns, all and singular the goods, chattels, personal property and effects hereinafter particularly mentioned and described all of which said goods and chattels, personal property and effects are now in the possession of the mortgagor, and are now situate, lying and being on, upon and about To HAVE AND TO HOLD all and singular the said goods and chattels, personal property and effects unto the mortgagee executors, administrators and assigns to the only proper use and behoof of the mortgagee executors, administrators and assigns forever : Provided always and these presents are upon this express condition that if the mortgagor executors or administrators do and shall well and truly pay or cause to be paid unto the mortgagee executors, administrators or assigns, the full sum of dollars, with interest for the same at the rate of per centum per annum in manner following, that is to say : — Then these presents and every matter and thing herein contained shall cease, determine and be utterly void to all intents and purposes, anything herein con tained to the contr.)ry thereof in any wise notwithstanding : And the mortgagor for self, executors and administrators shall and will warrant and forever defend by these presents all and singular the said goods and chattels and property unto the mortgagee executors, administrators and assigns against the mortgagor executors and administrators, and against all and every other person or persons whomsoever And the mortgagor doth hereby for self, executors and administrators covenant, promise and agree to and with the mortgagee executors, administra- tors and assigns that the mortgagor executors or administrators, or some or one of them shall and will, well and truly pay, or cause to be paid unto the mort- gagee executors, administrators or assigns the said sum of money in the above proviso mentioned with interest for the same as aforesaid on the day and time and in the manner above limited for the payment thereof : And also in case default shall be made in the payment of the said sum of money in the said proviso mentioned, or of the interest thereon or any part thereof, or in case the mortgagor shall attempt to sell or dispose of, or in any way part with the possession of the said goods and chattels or any of them, or to remove the same or any part thereof out of the county of or suffer or permit the same to be seized or taken in execution without the consent of the mortgagee, executors, administrators or 979 one :aUed the gee lid by the the receiiu ed, and by Is, personal are , upon now in and ;els, personal J and assigns dministrators ion that if the and shall well executors, for the same jing, that is ti) jntained shall ng herein con shall and will aid goods and |)rs and assigns assigns to such sale, removal or disposal thereof first had and obtained in writing, or in case the mortgagor shall suffer, allow or permit a judgment to be obtained against him for a debt in any court of law or e(iuity, or shall suffer, allow or permit any taxes, rates, duties, or assessments whatsoever, for which he now is or hereafter during the currency of these presents, may be assessed to remain unpaid and unsatisfied for a period of seven days after demand lawfully made therefor, by the proper officer in that behalf, or in case the mortgagor shall fail to pay the rent arising out of the land and premises upon which are situate and lying the said goods and chattels at any time during the currency of these presents, six days at least before the same shall be- come due, or in case default shall be made in the performance of any of the coven- ants by the mortgagor in these presents contained, then and in such case it shall and may be lawful for the mortgagee, executors, administrators or assigns with or their servant or servants, and with such other assistant or assistants as may require at any time during the day to enter into and upon any lands and tenements, houses and premises wheresoever and wliatsoever where the said goods and chattels or any part thereof may be, and for such persons to break and force open any doors, locks, bars, bolts, fastenings, hinges, gates, fences, houses, buildings, enclosures and places for the purpose of tni ""; possession of, and removing the said goods and chattels : And upon and fron a after, the taking possession of such goods and chattels as aforesaid it shall and may be lawful, and the mortgagee, executors, administrators or assigns, and each and any of them is and are hereby authorized and empowered to sell the said goods and chattels, or any of them, or any part thereof, at public auction or private sale as to them or any of them may seem meet : And from and out of the proceeds of such sale in the first place to pay and reimburse or themselves all such sums and sum of money as may then be due by virtue of these presents and all costs and expenses as may have been incurred by the mortgagee, executors, administrators or assigns in consequence of the default, neglect or failure of the mortgagor, executors, administrators or assijjns in payment of the said sum of money, with interest thereon as above mentioned, or in consequence of such sale or removal as above mentioned, and in the next place to pay unto the mortgagor, executors, administrators and assigns lall such surplus as may remain after such sale and after payment of all such sum or Isums of money and interest thereon as may be due by virtue of these presents at the against a a j^.^^ ^^ ^^^^ seizure and after payment of the costs, charges and expenses incurred by such seizure and sale as aforesaid : Provided that the mortgagee, executors, administrators or assigns may, n default of payment of any of lae payments of interest or instalments hereinbefore Imentioned or any part thereof, destrain for the whole principal sum then unpaid Provided always nevertheless that it shall not be incumbent on the mortgagee, executors, administrators or assigns to sell and dispose of the said goods and hattels, but that in case of default of payment of the said sum of money with interest Ihereon as aforesaid it shall and may be lawful for the mortgagee, executors, dministrators or assigns peaceably and quietly to have, hold, use, occupy, possess nd enjoy the said goods and chattels without the let, molestation, eviction, hindrance ir interruption of the mortgagor, executors, administrators or assigns, [ any of them, or any other person or persons whomsoever ; and the mortgagor doth lereby further covenant, promise and agree to and with the mortgagee, administrators ors, administra- Drs, or some or unto the mort- in the above and time nd also in case ,he said proviso ; the mortgagor e possession of any part thereof eized or taken in dministrators or IMAGE EVALUATION TEST TARGET (MT-3) .1^5% 4^ A^> ^ 1.0 1.1 ltt|21 12.5 -► ^. \% Photographic uCIBnGBS Corporation ^ ^^ \\ 23 WMT MAM STI«T vimim,N.v. 14SI0 (7U)in-4SM ,^0 280 •Nij c executors, administrators and assigns that in case the sum of money realized under any such sale as above mentioned shall not be sufficient to pay the whole amount due at the time of such sale that the mortgagor, executors or idminibtrators shall and will forthwith pay or cause to be paid unto the mortgagee executors, administrators and assigns all such sum or sums of money with interest thereon as may then be remaining; due, as well also as all costs and expenses as may have been incurred by the mortgagee in and about such seizure and sale. And the mortgagor doth put the mortgagee in the full possession of said goods and chattels by delivering to these presents in the name of all the said goods and chattels at the sealing and delivery hereof: And the mortgagor further covenant with the mortgagee that he will during the continuance of this mortgage and any and every renewal thereof insure the goods and chattels hereinbefore mentioned against loss or damage by fire in some insurance office (authorized to transact business in Canada) in the sum of not less than dollars, and will pay all premiums and moneys necessary for that purpose three days at least before the same become due and will on demand assign and deliver over to the said mortgagee executors, and administrators, the policy or policies of insurance and receipts thereto appertaining : Provided that if on default of payment of said premium or sums of money by the mortgagor in manner and at the time aforesaid, the mortgagor executors or administrators may pay the same and such sums of money shall be added to the debt hereby secured (and shall bear interest at the same rate from the day of such payment) and shall be repayable withj the principal sum hereby secured. In witness whereof, etc. Signed, sealed, etc. Affidavit of Bona Fides to Accompany above Mortgage. Ontario County of ), I, C. D., of the in the County of To Wit : ) the mortgagee in the foregoing Bill of Sale bjj way of mortgage named make oath and say : That A. B. the mortgagor in tha foregoing bill of sale by way of mortgage named is justly and truly indebted to mi this deponent C. D., the mortgagee therein named in the sum of dollar! mentioned therein : That the said bill of sale by way of mortgage was executed in good faith and foj the express purpose of securing the payment of the money so justly due or accruinJ due as aforesaid and not for the purpose of protecting the goods and chattel mentioned in the said bill of sale by way of mortgage against the creditors of thi said A. B. the mortgagor therein named or of the creditors of such mortgagor froif obtaining payment of any claim against him the said A. B. Sworn before me at in the County of day of year of our Lord, i8 this in the C. D., notary! Provir ofexch of pers speakiJ thereoi A Commissioner, etc., etc. I jjjgg 281 realized under le amount due nibtrators shall ;y with interest cpenses as may lie. ssession of said lame of all ibe ,t he will during nsure the goods some insurance ess than rpose three days I deliver over to cy or policies of I fault of payment and at the time say the same and I (and shall bear be repayable with PROTESTS. The holder of a Promissory Note, which has not been paid at maturity, and on which there is an Indorser's name, should have it immediately protested by a Notary Public (if the services of a Notary cannot be obtained at the place where the bill is dishonored, any Justice of the Peace resident in the place may present and protest such note and give all necessary notices), who will notify such indorser by depositing to his address in the Post Office of the place where the note or bill was due and payable ^ a notice of the protest. Should the holder neglect to notify the indorser not later than the next business day (or, if more than one indorser, all the indorsers), he will lose recourse against him or them. Drafts and Bills are also protested for non-acceptance, or non-payment, unless instructions to the contrary have been given (see page an). The drawer, as well as the indorser on a bill, must be notified of dishonor if the holder intends to hold them liable. WAIVING PROTEST. By waiving protest an indorser renders it unnecessary for the holder to have an instrument protested. This is usually done, if before maturity, by the indorser writing the words on the back : '* Presentation and Protest waived," John Jones. If at maturity : " I hereby accept notice of non-payment and waive protest." John Jones. Protest may be waived by letter or telegram, should the endorser be absent from the place of payment at the date of maturity. There is no necessity to protest a dishonored note upon which there is no in- dorser ; the maker can be held for six years after maturity. RTGAGE. of , .J ng Bill of SaleM 5 mortgagor inthj ily indebted to mi of dollarj I good faith and fol itly due or accruini goods and chattel he creditors of thi ,ch mortgagor frol CD., missioner, etc., etc. FORMS OF PROTEST. PROTEST FOR NON-ACCEPTANCE OR FOR NON-PAYMENT OF A BILL PAYABLE GENERALLY (tHAT IS AT NO STATED PLACE). {Copy of Bill and Indorsements.) On this day of , in the year i8 , I, A. B., notary Public for the Province of , dwelling at , in the Province of at the request of , did exhibit the original bill of exchange, whereof a true copy is above written, unto E. F., the < acceotor I *^^''^" of personally {or at his residence, office or usual place of busine >) in , and, speaking to himself ( answered : *• •" Wherefore I, the said notary, at the request aforesaid, have protested, and by these presents do protest against the promissor and indorsers of the said note, and all other parties thereto or therein concerned, for all costs, damages and interest, present and to come, for want of payment of the said note. All of which I attest by my signature. (Protested in duplicate.) -: ■ '"' '■■''■ "• A. B., ; t ;i^*'i^ V . i -, ; , • Notary Public, To Sir, Ml ite to j OTARIAL •YMENT And e form bill note / , on the sai In te loresaid. 283 erned, for all I to come, for otary Public. \. PAYAHLE 18 , I, A. B., in the Province I original bill of *®® I thereof, iptor ) , there, speaking said bill ; unto otested, and by {or drawer and mcerned, for all ome, for want of PROTEST FOR NON-PAYMENT OF A NOTE PAYABLE AT A STATED PLACE. (Copy of Note and Indorsements^ On this day of , in the year 18 , I, A. B., Inolary public for the Province of , dwelling at , in the Province , at the request of , did exhibit the original promissory liote, whereof a true copy is above written, unto the promissor, at , being the stated place where the said note is payable, and there, speaking io did demand payment of the said note, unto which demand he linswered: •' ." Wherefore I, the said notary, at the request aforesaid, have protested, and by ihese presents do protest against the promissor and indorsers of the said note, and all loiher parties thereto or therein concerned, for all costs, damages and interest, present jind to come, for want of payment of the said note. All of which I attest by my signature. (Protested in duplicate.) A. B., Notary Public. To NOTARIAL NOTICE OF PROTEST FOR NON-PAYMENT OF A NOTE. (Place and date of Protest.) Sir, at Mr. P. Q.'s promissory note for $ , the , dated at I days I payable X months > after I on ) Notary Public. (that is at ar 18 ,1, A. B, , in the ichibit the original , the ; of business) in his servant, &c.), irotested, and by said note, and all id interest, present pte to I ]^li I or or Jer, and indorsed by you, was this day, at the request of , duly protested by me for non-payment, A. B., Notary Public. lorARIAL SERVICE OF NOTICE OF A PROTEST FOR NON-ACCEPTANCE OR NON- |»VMENT OF A BILL, OR OF NON-PAYMENT OF A NOTE (to be subjoined to the Protest), And afterwards, I the aforesaid protesting notary public, did serve due notice, in le form prescribed by law, of the foregoing protest for -j noJJ'paymen" } °^ *^® I thereby protested upon {q^!;}^^^ { fndorYers } P^sonally, on the day of {or at his residence, office, or usual place of business) in ^ on the day of ; {or, by depositing such notice, directed the said | E* 8' i at , in Her Majesty's post office in , on day of, , and prepaying the postage thereon). In testimony whereof, I have, on the last mentioned day and year, at iresaid, signed these presents. bill I note J A. B, Notary Public, Notary Public. II « ^. 284 '« C" PROTEST BY A JUSTICE OF THE PEACE (WHERE THERE IS NO NOTARY) FOR NON-ACCKPT.| ANCE OF A BILL, OR NON-PAYMENT OF \ BILL OR NOTE. (Co/y of Bill or Note and Indorsements) On this day of , in the year i8 ,1, N.O , one oil Hg: Majesty's justices of the peace for the district (or county, &c.), of , in thel Province of , dwelling at {or near) the village of , in the saidj district, there being no practising notary public at or near the said village {or an\ other legal cause), did, at the request of , and in the presence of , a householder in the said district, well known unto me, exhibit the original] I note } ^^^""^^^ ^ *'"^ ^°Py '' *^°^^ ^""^" ""*^ P- Q ' ^^^ \ acceptor i thereofJ and promissor ) personally {or at his residence, office or usual place of business) in speaking to himself (his wife,his clerk orhxs servant, &c.),did demand < ^ ment^^ thereof, unto which demand J . ^ { answered : " ," Wherefore I, the said justice of the peace, at the request aforesaid, have proj I drawer and indorsers tested, and by these presents do protest, against the< promissor and indorsers \ acceptor, drawer and indorsers )\ of the said | * land all other parties thereto and therein concerned, for all exi change, re-exchange, and all costs, damages and interest, present and to come, fuj All which is by these presents attested by the signature of the said {the wUnes\ and by my hand and seal. (Protested in duplicate.) {Signature of the witness.) { Signature and seal of the J. P. ) loF Lad lis the sa roods c( CHIPPED t< S V( ■arks and J. T. & M. NOTING. ■ Bein When a bill or note is required to be protested within a specified time, it is sulW*^ °''"' cient that it has been noted for protest before the expiration of the specified tiraM'^' °' ^ and the formal protest may be extended at any time thereafter as of the date of tW'"® ^^^ noting. There is a form for noting and giving notice of it. It is form A in the fitM^'' ^^W schedule of the Bills of Exchange Act, i8go. I In wi| "ills of : stand vl Date/ BILLS OF LADING. The expression •* Bill of Lading " includes all receipts for goods, wares merchandise, accompanied by an undertaking to transport the same from the |)la| where they were received to some other place, whether by land or water, or par| by land and partly by water, and by any mode of carriage whatever. Banks are empowered to acquire Bills of Lading, as collateral security fori payment of any debt incurred in their favor in the course of their business ; and tii may exchange Warehouse Receipts (see Warehouse Receipts, page 183) for Bid ThreJ Exchanl le sent tj The buyerI Itil the OR NON-ACCKPT- I, N.O , one oil jf , in the! , in the saidi I village {or any sence of ihibit the original| I 285 loF Lading on shipment of goods previously covered by Warehouse Receipts. There lis the same penalty for making a false statement in a Bill of Lading, or alienating boods covered by one, as in the case of Warehouse Receipts. (See page 183.) iwer :eptor / Qmissor ) thereof! and ( acceptance \ payment » )resaid, have pro| lorsers , indorsers vet and indorsers lerned, for all exl and to come, foj e said (M« iviines^ he witness.) sealoftheJ.P.) ified time, it is sufI the specified timd of the date of tH form A in the fin A FORM OF BILL OF LADING. [hipped in apparent good order by S. G. Beatty, Hamilton, Ontario, and consigned to the order of Messrs. J. Taylor & Co., Montreal, in and upon the SteamerPassport, whereof Thomas Smith is master or agent for the present voyage, and now lying in the port of Hamilton, viz. : llaiks and Numbers. ]. T. & Co. M. 139 Articles. Thirty-five Boxes Tea, Forty-six Bales Paper Bags WRIGHT. 2100 for goods, wares ame from the i)la| or water, or par| er. .teral security for t • business ; and tli page 183) for Bifl Being marked and numbered as per margin ; and are to be delivered in like od order and condition, at the Port of Montreal, in the Province of Quebec (the \x of God, the Queen's enemies. Fire, and all and every the dangers and accidents (the Seas, Rivers and Navigation, of whatever nature and kind excepted), he or fey paying freight for the said goods at the rate of twenty-five cents per cwt. In witness whereof, the Master or Purser of said vessel hath affirmed to three Jills of Lading, all of this tenor and date ; one of which being accomplished, the rest island void. Dated at Hamilton, this 21st day of June, 1894. C. Porter, Purser. Three Bills of Lading are frequently given, all constituting (just like foreign Bills (Exchange) one bill. This is done in order that one may be given to the vessel, p sent to the consignee and one retained by the consignor. The expression a " Free Bill of Lading " means where goods are consigned to BUYER direct, instead of to the order of a bank, which would not give up conirol Itil the goods were paid for, or a draft for the amount accepted. h 1 1. 286 MJ »«• Ml DEEDS. A Deed is a writing sealed and delivered, to testify fhe agreement of the partiesi to the thing contained in the deed. All instruments under seal are in law, deeds ;l but in common acceptation a deed is a conveyance of lands. The consideration of al de€d may either be good or valuable. A good consideration is founded on nafurall love and affection between near relations by blood ; a valuable consideration is| founded on something deemed valuable, as money, goods, service or marria&e. Every deed or contract is void when made for any fraudulent purpose, or ml violation of law, such as a deed given in preference of one creditor unjustly oven others. FORM OF DEED OF LAND. This Indenture made (in duplicate) the day of in the year of our Lord one thousand eight hundred and in pursuance of the Act respecting Short Forms of Conveyances : Settveen Witnesseth, that in consideration of of lawful money of Canada now paid by the said part of the part to the sail part of the first part (the receipt whereof is hereby by acknowledged), the said part of the first part do grant unto the said part of the part in fee simple All and singular th certain parcel or tract of land and premises situati lying and being To have and to hold unto the said part of the pan heirs and assigns to and for their sole and only use forever ; subject, neverthi less, to the reservations, limitations, provisoes and conditions expressed in the origin: grant thereof from the Crown. The said part of the first part covenant with the said part of the part that ha the right to convey the said lands to the said part of the part notwithstanding any act of the said part of the first part. And that the said part of the part shall have quiet possession of tli said lands free from all incumbrances. And the said part of the first part covenant with the said part of tl part, that will execute such further assurances of the sa lands as may be requisite. And the said part part, that of the first part covenant with the said part of ha done no act to incumber the said lands. And the said part of the first part release to the said part of the part all Claims upon the said lands. And the said wife of the said party of the first part hereby bars her dower in the said lands. In Witness whereof the said parties hereto have hereunto set thi hands and seals. Signed, sealed and delivered ) in the presence of I Note. —The Affidavit of Execution (see page 258) is on the back of a deed, Ti Bi the nar subject Nc covenar Mlows nt of the parties! » in law, deeds; onsideration of al unded on natural! consideration is| • marriaee. It purpose, or inl itor unjustly oveJ ^ of of lawful part to the said knowledged), of the nd premises situate { the pafl ; subject, neverthf essed in the origin! rt of the to the said part the first part. ,et possession of thj said part of tl| isurances of the s:^ said part "fill : the said lands. 287 QUIT CLAIM DKED. Thin Indenture, made (in duplicate) the first day of September, in the year of Our Lord one thousand eight hundred and ninety-four. Between, George West, of the town of, etc., and Mary West, the wife of the said George West, of the first part, and James East, of the, &c., of the second part. WitneSftethf that the said parties of the first part, for and in consideration of (here insert the amount) of lawful money of Canada, to them in hand paid by the said party of the second part at or before the sealing and delivery of these pre- sents (the receipt whereof is hereby acknowledged), have granted, releaseed and quitted claim, and by these presents do grant, release and quit claim unto the said party of the second part, his heirs and assigns for ever, all the estate, right, title, in- terest, claim and demand, whatsoever, both at law and in equity, or otherwise howso- ever, and whether, possession or expectancy of, in, and to, all and singular that certain parcel or tract of land and premises situate, lying and being, etc. (here descride the propretv). Together with the appurtenances thereto belonging or appertaining ; to have and to hold the aforesaid land and premises, with all and s ngular the ap. purtenances thereto belonging or appertaining, unto and to the use of the said party of the second part, his heirs and assigns for ever ; subject, nevertheless, to the reserva- tions, limitations, provisoes and conditions expressed in the original grant thereof from the Crown. In witness whereof, the said parties to these presents have hereunto set their iiands and seals the day and year first above written. Signed, sealed and delivered | in the presence of / GEORGE WEST. : seal. : E. B. Sample. ) : MARY WEST. ': ^^^^ : art of the INDENTURE, OR ARTICLES OF CO-PARTNERSHIP. this day of le said lands, /e hereunto set M e back of a deed. This Indenture, made in one thousand eight hundred and Between of the of in the county of of the first part. Whereas the said parties hereto have agreed to become Co-partners in the of at the of in the county of under Ithe name, style and Firm of |subject to the covenants and agreements hereinafter expressed. Now this Indenture Witnesseth, that each of the said parties hereto Icovenant and agree with the other of them, his executors and administrators, as follows : — Note. — No two articles of co-partnership will be alike. This is given to indicate the form that would be followed, |ind tlie probable facts to be stated. The arrangement that should be m.ide for an equitable distribution of gains antl osses wiiere there is an unequal investment of capital, but equal skill and time, is stated at p.ige 80. Also at the same age will be found the manner of adjusting inequality in time and skill. A declaration of partnership in Ontario must be (led at the Registry Office within six months from its formation. M» m 288 I. That the said parties shall be co-partners together in the of MJ c style and firm of for ti\^ term of of under the nam. day of at the year to be computed from tlie in the County 2. That the said co-partners shall each contribute towards the Capita! Stock of the co-partnership as follows : — 3. That the said Partners shall be entitled to the profits of the said co-partner- ship in the proportion following : the said 4. That all losses and expenses of the said co-partnership shall be borne and paid. 5. That each of the said partners shall be at liberty to draw out the profits ot the said co-partnership weekly, a sum not exceeding 6. That the management and control of the said business shall be conducted by and that no servant or workman shall be engaged or discharged without the consent of 7. That all profier and correct Books of account shall be kept of the said co-partnership, and shall at all reasonable times be open for the inspection of the said co-partners. And a complete balance sheet shall be prepared once in every months. I 8. That a general statement of the stock-in-trade, book debts, accounts and| debts owing by the said co-partnership shall be made on the day of each year of the said term. 9. That at any time during the said term either of the said co-partners shall be| at liberty to determine the said co-partnership by giving to other of them month's notice of his intention to determine the same, or in case of the death ofl either of the said partners this co-partnership shall thereupon cease in the same man | ner as though the same had determined by effluxion of time. 10. That in case of any disputes or differences between the said co-partners the same shall be referred to Arbitrators to be chosen and appointed, one Arbitrator foij each co-partner, and the Umpire to be chosen by such Arbitrators, and the award oj a majority of them to be final, and in case of either partner neglecting or refusing m one month to appoint an Arbitrator, the other partner to be at liberty to appoinj one on his behalf. Such Arbitrators to have all powers and authority necessary ta settle the matters in question, and such Arbitration not to be considered a dissolutioij of the said co-partnership. I Z I 11. That neither of the said partners shall make, draw, endorse or accept anflHastingJ Bill of Exchange or Promissory Note, outside the ordinary business of the firm, olconsider become bail or surety for any person, or commit any act or thing whereby the partneildeclare ship moneys or effects may be endangered of attachment or execution. I ^• Thai each of the said partners shall be just and true to each other in all matteifland disc of the said business, and will devote their whole time diligently and faithfully to thIconnectJ 289 ler the nanu, uted from Uie in the County apital Stock of said co-partncr- II be borne and ut the profits ot be conducted by and that no consent j cept of the said concerns of the same, and will not at any time during their co-partnership engage in any other business what ver. 13. That at the expiration of this co-partnership the parties herclo shall appoint some fit and proper person to get in all outstanding accounts and to settle and adjust the partnership concerns. In Witness Whereof, the said parties hereto have hereunto set their Hands and Seals. Signed, sealed and delivered \ in the presence of i NoTB.— For aflldavit of Execution see page 258. AGREEMENT FOR BUILDING A HOUSE. This Indenture made (in duplicate) this day of , in the year of our Lord one thousand eight hundred and ninety-two, between A. B., of, etc., and C. D., of, etc. WITNESSETH, that the said C. D., for the consideration hereinafter mentioned doth for himself, his heirs, executors and administrators, covenant with the said A. B., his executors, administrators and assigns, that he shall and will within the space of (here insert the time) next after the date hereof, in a good and workmanlike manner, and at his own proper charge and expense, at (here insert the place), well and substantially erect, build and finish one house, according to the draught, scheme and specifications hereunto annexed, with such stone, brick, timber and other action of the said I materials, as the said A. B. or his assigns shall find or provide for the same. every months. »ts, accounts and day of In Consideration whereof the said A. B. doth, for himself, his executors and administrators, covenant with the said C. D., his executors and assigns, well and truly to pay unto the said C D., his executors and assigns, the sum of of lawful money of Canada, in manner following, viz.: part thereof at the beginning of said work, more, another part thereof, when the said work shall be half done, and the remaining in full for the said work when the same shall be completely finished : And also that he, the said A. B., his executors, administrators or assigns, shall and will, from time to time, as the same shall be required, at his and their own expense, provide stone, brick, timber and other materials necessary for making, building and finishing the said house. And for the performance of all and every .the articles and agreements above mentioned, the said A. B. and C. D. do hereby bind themselves, one Arbitrator '0'ljj,gjj. executors, administrators and assigns, each to the other, in the penal sum of and the a^ard oB|.^^j^^ ^^ ^^^^^ presents. partners shall bej hem 5 of the death ofl in the same man- lid co-partners thd ing or refusing m liberty to appoinj ority necessary ti dered a dissolutioii In Witness Whereof, &c. FORM OF WILL.— SEE WILLS, page 259. I, William Henry Brown, of the City of Belleville, in the County of ■)rse or accept anlHastings and Province of Ontario, Canada, being of sound mind and memory, and ess of the firm, olconsidering the uncertainty of this frail and transitory life, do therefore make, and Thereby the partneldeclare this to be. my last Will and Testament, that is to say : iQn^ I First — After all my lawful debts and funeral and testamentary expenses are paid ther in all matteiiand discharged, I bequeath to my wife, Laura Brown, the dwelling house and land d faithfully to thiconnected therewith, which we now occupy as a homestead ; and all the furniture and 10 990 »M C household goods, including pictures, books, linen, china, plate, provisions, chattels, and efTects (other than money or securities for money), which shall at my deaih be in or about my dwelling-house, or the outbuildings or grounds thereof. I aUo bequeath to my said wife the sum of six thousand dollars cash, to be paid to her withig one calendar month after my death, without interest. Second. — I give to my daughter Jane, four thousand dollars cash, and thiny shares in the Bank of Montreal, for her sole use and for the use of her heirs at her discretion. Third.— I give to my son William, all my real estate in the Township ol Thurlow, County of Hastings, Province of Ontario, and all the live stock and implements used for farming purposes in connection with the same. Fourth.— 'V)ciQ residue of my property, real and personal, I give and bequeath to my son Thomas. Fi/th.—l hereby appoint my son William to be executor and my wife Lauka executrix of this, my last will and testament, hereby revokmg all former wills by me , made. And I appoint my said wife and Robert Henry Smith, of the City of| Belleville aforesaid, guardians of my infant children. In Witness Whereof, I, the testator, have hereunto set my hand and seal,! this first day of December, in the year of our Lord one thousand eight hundred andj ninety-two. Signed, sealed and delivered by the testator,^ in the presence of us, who (in his presence), at his request, and in the presence of each other, have hereunto subscribed our names as witnesses. Thomas Strong, of Cobourg, Ontario. Peter Farnor, of Belleville, Ontario. > WILLIAM H. BROWN. seal; / POWER OF ATTORNEY. Know all men by these Presents, that I (insert name here), of in the County of and Province of Ontario, for divers gooj causes and considerations me thereunto moving, have nominated, constituted anj appointed, and by these presents do nominate, constitute and appoint (insert naml here) my true and lawful Attorney, for me and in my name and on my behalf, anf for my sole and exclusive use and benefit, to demand, recover and receive from and every or any person or persons whomsoever all and every sum and sums money, goods, chattels, effects and things whatsoever which now are or is, or whid shall or may hereafter appear to be due, owino:, payable or belonging to me, whethj for rent or arrears of* rent, or otherwise in respect of my real estate, or for tl[ principal money and interest now or hereafter to become payable to me upon or respect of any mortgage or other security, or for the interest or dividends to accrij or become payable to me for in respect of any shares, stock or interests which I mi now or hereafter hold in any Joint Stock or Incorporated Company or companies, [ possel and agent! remoi discre and al shares 901 :)n8, chattels, It my deaih reof. 1 aK) paid to lior h, and thiny of her heirs at Township ol ive stock and nd bequeatli lo my wife Laura mer wills by me of the City of hand and seal, ght hundred and for any moneys or securities for money which are now or hereafter may be due or owing or belonging to me upon any Bond, Note, Hill or Hills of Kxchange, balance of Account Current, consignment, contract, decree, judgment, order or execution, or upon any other account. And to examine, state, settle, liquidate and adjust all or any account or ac- counts depending between me and any person or persons whomsoever. And to sign, draw, make, or indorse my name to any Cheriue or Cheques or Orders for the pay- ment of money. Hill, or Hills of Exchange, or Note or Notes of Hand, in which I shall be interested or concerned, which shall be requisite. .And also in my name to draw upon any Hank or Hanks, Individual or Individuals, for any sum or sums of money that is or are or may be to my credit, or which I am or may be entitled to re- ceive, and the same to deposit in any Bank or other place, and again at pleasure to draw for from time to time as I myself could do. And upon the recovery or receipt of all, and every or any sum or sums of money, goods, chattels, effects or things due, owing, payable or belongmg to me, for me and in my name and as my act and deed to sign, execute and deliver such good and sufficient receipts, releases and accpiit- tances, certificates, reconveyances, surrenders, assignments, memorials or other good and effectual discharges as may be requisite. AlHOf in case of neglect, refusal, or delay on the part of any person or persons to make and render just, true and full account, payment, delivery and satisfaction in the premises, him, them or any of them thereunto to compel, and for that purpose for me in my name to make such claims and demands, arrests, seizures, levies, attachments, distraints, seciuestrations, or to commence, institute, sue and prosecute to judgment and execution such actions, ejectments and suits at law or in equity as my said attorney or attorneys shall thmk fit ; also to appear before all or any Judges, Magistrates or other Officers of the Courts of law or e(iuity, and then and there to sue, plead, answer, defend and reply in all matters and causes concerning the premises ; And also to exercise and execute all Powers of Sale or Foreclosure, and all other powers and authorities vested in me by any mortgage or mortgages belonging to me as mortgagee. And also, in case of any difference or dispute with any person or persons concerning any of the matters aforesaid, to submit any such differences and disputes to arbitration or umpiracre, in such manner as my said attorney or attorneys shall see fit ;And to compound, compromise and to accept part in satisfaction for the payment of the whole of any debt or sum of money payable to me, or to grant an extension of time for the payment of the same, either with or without taking security, or otherwise to act in respect of the same as to my said attorney or attorneys shall appear most expedient. And also, for me and in my name, or otherwise on my behalf, to take possession of and to let, set, manage and improve any real estate, lands, messuages and hereditaments whatsoever and wheresoever, and from time to time to appoint any agents or servants, to assist him or them in managing the same, and to displace or remove such agents or servants, and appoint others, using therein the same power and discretion as 1 might do. And also, as and when my said attorney or attorneys shall think fit to sell v.- h 1 ma ^"** absolutely dispose of my said real estate, land and hereditaments, and also such erests whic ■ shares, stocks, bonds, mortgages, and other securities for money as hereinbefore ,y or companies, ■»»'«» lOWN. '.seal: lame here), of for divers gooi Id, constituted am [point (insert nami Ion my behalf, an| id receive from sum and sums lare or is, or whi<^ ling to me, wheth< estate, or for tl to me upon or iividends to accn 202 ^ki>i4M>> mentioned, either together or in parcels, for such price or prices, and by public auction or private contract as to my said attorney or attorneys shall seem reasonable or exped- ient ; And to convey, assign, transfer, and make over the same respectively to the purchaser or purchasers thereof, with power to give credit for the whole or any part of thej)urchase money thereof ; And to permit the same to remain unpaid for what- ever time and upon whatever security, real or personal, either comprehending the the purchased property or not, as my said attorney or attorneys shall thmk safe and proper. And Further f for me and in my name and as my act and deed, to execute and do all such assurances, deeds, covenants and things as shall be required, and my said attorney or attorneys shall see fit, for all or any of the purposes aforesaid : and to sign ard give receipts and discharges for all or any of the sum or sums of money which shall come to his or their hands by virtue of the powers herein contained, and which receipts, whether given in my name or that of my said attorney or attorneys, shall exempt the person or persons paying such sum or sums of money from all responsibility of seeing to the application thereof. Atid alsOf for me and in my name, or otherwise, and on my behalf, to enter into any agreement or arrangement with every or any person to whom I am or shall be indebted touching the payment or satisfaction of his demand, or any part thereof; And generally to act in relation to my estate and effects, real and personal, as fully and eflfectually, in all respects, as I myself could do if personally present. And I hereby f/rant full power to my said attorney to substitute and appoint one or more attorney or attornevs under him, with the same or more limited powers, and such substitute and substitutes at pleasure to remove, and others to appoint, I, the said (here insert name), hereby agreeing and covenanting for . /self, my heirs, executors and administrators, to allow, ratify, and confirm whatsoever my said attorney or his substitute or substitutes shall do or cause to be done in the premises by virtue of these Presents ; including in such confirmation whatsoever shall be done between the time of my decease or of the revocation of these presents, and the time of such decease or revocation becoming known to my said attorney or attorneys or such substitute or substitutes. As ivitness my hand and seal this day of in the year of our Lord one thousand eight hundred and ninety- Signed, sealed and delivered | in the presence of > The authority conferred by Power of Attorney is called " Procuration." When signing by procuration (say an accountant signing a check, drawing a draft, endorsing, etc.), sign thus : ROBINSON & JOHNSON, per pro. WM. PRINGLE. (or pp) It is done a little more formally in such an instrument as a deed or mortgage or lease, as JOHN JONES, by his Attorney, W. N. PONTON. Note. — The above is a General Power of Attorney. A Special Power of Attorney would confer limited power, for instance, to perform one act or a limited number of acts only. public auction able or exped- ictively to the )le or any part paid for what- rehending the hink safe and eed, to execute ^juired, and my aforesaid; and sums of money contained, and ey or attorneys, money from all behalf, to enter m I am or shall ,ny part thereof; ersonal, as fully sent. ley to substitute le same or more lOve, and others ^nting for . /self, 1 whatsoever my be done in the whatsoever shall se presents, and said attorney or in the uration." When a draft, endorsing, RINGLE. ed or mortgage or y N. PONTON. I confer limited power, for 293 QUESTIONS FOR REVIEW.— BUSINESS PAPERS. What is a Bill of Exchange ? How many persons are interested therein ? When the drawee of a bill undertakes to pay it, what is he then called ? Describe what is necessary in order to transfer bills of different kinds. Bills of Exchange are of how many kinds ? How are foreign Bills usually drawn ? What is the object of drawing them in sets ? Give the form of a set of Exchange. W hat is a Promissory Note ? What resemblance is there between a Note and a Bill of Exchange ? Must a Bill or Note, or an indorsement thereon, necessarily be in ink ? If there should be a variance between the sum superscribed in figures and that mentioned in the body of the note, which will prevail ? Does the omission of the place where the note is made, the date, or the words " value received," invalidate it ? Under what circumstances does the dating of a note on Sunday render it void ? Can a note made by an infant be collected under any circumstances ? Has a married woman power to issue a note or bill ? Relate some points ot law that govern notes issued by women. What persons are, by law, considered incom- petent to make a contract ? Can a note be collected if obtained by fraud, duress, or from a person in a state of drunkenness ? What is a joint note ? How should the makers of a joint note be sued ? What is a joint and several note ? What is the distinction between a joint note and a joint and several note ? What effect has an alteration on a bill or note, after it has been issued ? What is the drawer's undertaking in a Bill of Exchange ? What is the duty of the payee if the bill remain in his possession ? What is the acceptor's undertaking ? How is the acceptor's liability discharged ? What is an indorsement ? Name five different forms of indorsement, and give an example of each. If a note indorsed by several parties be dishonored, against whom has the holder a right of action ? If a note be paid by the first indorser, to whom must he look for the recovery of the amount i Has the first indorser, under any circumstance, a right of action against the subsequent indorsers ? What is the object of the several forms of indorsement ? What is the distinction between negotiable and non-negotiable paper ? How is negotiable paper transferred in order to give the holder the right of action ? Is it necessary to present a bill for acceptance ? What is understood by a bill bemg honored and dishonored ? Why is it necessary to give notice of a bill being dishonored ? What is necessary in order to hold the indorser of a bill or note ? When is a note drawn on demand or without a specified time, payable ? If a note is dishonored how should notice be given ? Has the party paying a bill or any other debt a right to demand a receipt ? Under what circumstances may interest be collected on a note ? How many years has a note or other debt to run before it becomes outlawed ? Can the amount of a lost bill or note be recovered, under any circumstances? Name some of the different papers used in business, aside from bills or notes. Define some of these papers. If a receipt be given in mistake, does it necessarily bind the giver ? Name the different forms of time drafts. What is necessary before a draft becomes the obligation of the person on whom it is drawn ? In what cases are drafts used ? What form is adopted in accepting a draft ? When is the date of acceptance required ? What are cheques, and wherein do they differ from bills of Exchange ? What is necessary to make a legal seal? Define the following terms used in connection with a will : Testator, Donee, Legatee, Devisee and Executor. How many subscribing witnesses does a will require ? Where should the signature of the testator be placed? What effect has the marriage of the testator upon a will ? What is said of a will made by a person under twenty-one years of age ? 294 CBII J o ►S 0) .2 aaa "^ K o >~ S " §.'5 §H-^a^ ^ I— ,9 *■ u « h — fi a, ^ u S "15 •- G ^ M ^. -^ S V G N ^ ^^ it o o< U ^ d § „ o >. p -5 .a >< rt r B !i »• £ 5 o "^ O O o > S fe O " ^ S 3 - •s K^ I. = 5 -^ o 3 ^S •», w 5 1„ ,9 u u «<■'■ -ja U= i^s: i^ " S 2 j: j; >« jj ' -i « e-SaJsnJcA >, fc- rt o i uaSf ) uT/S; r~oo ** »"r- rt _ . - ,„J= OS S O >, o rt rt ^ i» S. e-^rtH „0-o « u D "13 - J3 o (4 n >^ u rt -•c = p 0|2 > is C u 0.0 o n n >^ u rt n s rt s«c3 -•S ° O -Ji ° S4S ■;: aaa ail §2- I. I. c c e rt _ . . . cil^ 1 1:= S . c SQ XiJc/3 >. u rt Vi i; rt ■sasS rt_ pi U = 0, "^ I) " • fll U -1 Si ^A 2: i. c c « O S O iT 41 " V t; u 0.0 £.S § & o rt rt >% ^ rt ■- ■ rt O '^■■5 ° 0.2a;S rt _ . . o o -J! S>-dg 4i rt ,.S o rt rt >. u rt as * UI-. 0.2 8:2 u •a aaa O « >^ ' U 4) ! ii fc« jC ^ u. C C " S u 0.0 £.5 o ^ 0) >' ^ 8 c c 3't: rt ■ . O rt rt « O -^u a ^ ^ t— « ^ 4>'« e f- Pi >-) I rt S S o . 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(I * C Ate;.**" It should not be forgotten that a valid and binding contract can be made by the interchange of letters, if a direct offer be unconditionally accepted. Preserve letters received. When answered, fold them to one uniform size, and on the back, at the top, place the writer's name and address and the date of the letter. Put them away in m'onthly packages. All important letters written to others should be copied in the letter copying book by the copying press process. In all composition, three things require attention : the thoughts, their arrange- ment and the language employed. Of all kinds of composition, letters are the most universal and important ; yet among the millions written annually, how few could bear criticism : Errors in spelling, grammar, penmanship and arrangement are generally attributed to haste, which is considered as ample apology for every fault ; when, in reality, the writer is not qualified to write a letter correctly under the most favorable circumstances. In no way can a person so commend himself to the favorable regard of others, or impart to them so just an idea of his mental qualities, as by writing. ♦COMPOSITION. DEFINITIONS — SYNTHESIS OF SENTENCES. 1. Literary Composition is putting words together in order to convey our thoughts to others. Good composition conveys our thoughts correctly, clearly, and pleasantly, so as to make them readily understood and easily remembered. To express ourselves well we must first have something to say. If we have not been able to come to any definite conclusion about a subject, we should be silent. We must next choose the right names for the things or actions of which we are going to speak. This is not always easy, for we are apt to talk loosely of quantities and qualities ; to say there are " thousands " when there are only hundreds, to call an event "marvellous" when it is only unusual, or to refer to "ages" when there are only years. Lastly, we must arrange our words in the right way, so that they shall fit one another and combine to make good sense : just as we must put bricks or stones together properly to make a building stand. All language is a construction ; it is the building or binding of words. 2. The term Sentence is applied to every arrangement of words expressing a complete sense, that is, a thought, judgment, or decision. Every sentence involves a mental realization of two things and an assertion of some connection between them. When I say " I am here " I have an idea of myself, of a present place, and of my being in it. When I say " Cain struck Abel " I have the idea of Cain, of his brother, and of a blow passing from one to the other. The verb in the latter case is transitive, in the former intransitive ; in each we make no more than one plain assertion, and the result is a Simple Sentence. But when I say <' James and I met John " I make, in short space, three statements : — I met John, James met John. I and James were together. The result is a Compound Sentence. •Prof, Nisbol, LL.D. 297 i made by tho reserve letters le back, at the Put them away ! copied in the , their arrange - important ; yet im : Errors in buted to hasto, ity, the writer is instances, egard of others, 3. Frequently we have to make statements modified by some qualification. This qualification may be expressed by a single word, as " I ran home quickly " ; by a Phrase, or set of words without a subject and predicate, as " I met him ofi my way home " ; or by a Clause, or set of words containing a subject and predicate, as " I met him wAt'/e he was on his way homp" Clauses may often be expressed by phrases, and phrases may be shortened into words — e.g., " when he was acting as an enemy," or '* acting as an enemy," or " hostilely." Co-ordinate Clauses are parts of sentences otherwise independent but connected by conjunctions, as " They gave up the attempt and retreated to their fortresses." A Subordinate Clause is a clause the construction and meaning of which is dependent on the principal or leading assertion, as " He ran quickly that he might get home first." Sentences containing subordinate or secondary clauses are sometimes called Complex Sentences. A sentence may be both compound and complex ; it may convey an indefinite number of statements, and each may be qualified by an indefinite number of clauses. There should, however, in every instance be a leading statement, obviously more important than the others, and giving a unity to the whole. Otherwise the facts or thoughts should be expressed in several sentences. 4. Clauses have been called adjective, relative, adverbial, or conjunctive, according to the parts of speech which introduce them ; but it is of more consequence to observe that they are expansions in form, in matter, various modifications, either in the way of extension or restriction, of the main subject and predicate. Half the art of composition consists in keeping the subordinate parts of the sentences in proper relation to the principal parts. Making the main assertion clear is to a writer what making his house stand firm is to a builder. Details of ornament are minor matters. 5. To this end the practice of Grammatical Analysis — or splitting compound and complex sentences into their elements — is an aid. By a converse process, Gramma- sely of quantities ■ ^^^^^ Synthesis, these elements, the expression of the separate judgments a sentence indreds, to call an | contains, are bound together. Take the following :— Sir Philip Sidney was wounded. He was at a battle. It took place near Zutphen. The wound was inflicted by a musket ball. It broke the bone of his thigh. This led to his death. These assertions are easily gathered up into a single compound and complex sentence : — " Sir Philip Sydney, at the battle near Zutphen, was wounded by a musket ball which broke the bone of his thigh and led to his death." Or take a different kind of construction : — He sacrificed his country. He sacrificed his home. He sacrificed his personal honor. He sacrificed them to a cause, He was now deserting it. • to convey our iCily, clearly, and aered. If we have not }u1d be silent, of which we are " when there are they shall fit one bricks or stones! truction j it is ihe | rords expressing a| ind an assertion of an idea of myself, ruck Abel " I have to the other. The each we make no But when I say mts :— I met John, impound Sentence. 298 c: .«.!• at All these fiicts failed to influence his decision. Condense thus : — " That he had sacrificed country, friends, home, and personal honor to the cause he was now deserting did not influence his decision " [Synthesis of a greater number of assertions into variously qualified unities may be made to form the subjects of more difficult but highly useful exercises.'] 6. Modifying phrases and subordinate clauses often occupy much more space than the principal clause, but the latter is the pivot of the sentence. The qualifications may either — (a) Follow the main assertion ; {b) Precede it ; or, {c) Be inserted between its members. Take the following as examples of the three modes of their introduction : — {a) •' The castle consists of a square keep or tower, several storeys high, encom- passed by a square embattled wall, which has circular towers at each angle." {b) " While the multitudes below saw only the flat sterile desert in which they had so long wandered, bounded on every side by a near horizon, or diversified only by some deceitful mirage, he was gazing, from a far higher stand, on a far lovelier country." (c) •' The two opposite parties who professed in specious terms, the one a prefer- ence for moderate aristocracy, the other a desire of admitting the people at lari^e to an equality of civil privileges, made the .state which they professed to serve in reality the prize of their contention." The first of these is called a Loose sentence ; because it might end with " tower" and yet convey a distinct and apparently complete sense ; the adjective clauses are thrown upon what precedes, as if they were afterthoughts. The second and third, where the assertion does not appear till the close, are called Periods. In some instances the former, in others the latter mode of construction is preferable. 8. A succession of sentences relating to the same view of the same subject is called a Paragraph, the close of which is generally indicated by the next sentence beginning with a new line. The separate sentences explain or illustrate one another, and have the same kind of relation to the paragraph that the clauses have to the sentence. A series of paragraphs make up a Theme, Speech, or Essay, or Chapter of a Book. PUNCTUATION. The relation of the parts of a sentence to one another should be made as plain as possible by proper arrangement ; but it is sometimes made more clear in spoken language by proper pauses, and in written or printed language by Punctuation. The following are the Points common in English, and the main rules for their use : — The Full Stop ( . ), or Period, marks the close of a sentence, whether simple or complex, loose or periodic. It indicates that the construction is complete, and that an assertion has been fully made ; though other sentences in the same paragraph may follow to modify the thought. The Period is also employed to mark abbreviations, as in Christian names or titles — T. B. Potter; Lord Beaconsfield, K.G. i:y : :ease. IS cone {c) ) To connect two or more nouns, adjectives, or particles, so as to form them into a single compound, as — " l)ry-as-dust history " ; " That nevertobe-foigotten day " ; " That man-monkey." Such compounds should be used sparingly. 9. The marks ( •' " ) should be employed wherever a quotation is made, or a speech directly reported. In dramatic dialogue, however, they are omitted, it being taken for granted that the words are in the mouths of imaginary speakers. 10. Contractions. The following signs are universally recognized : — i.e., for id est, that is to say, to expand or explain. eg., for exempli gratia, for example's sake, "o illustrate. viz., for videlicet, to wit, to give an instance or enumerate the parts before referred to generally. etc., for etcetera, and the rest, when all the parts necessary to illustrate the propo- sition have been named, and it would be waste of time to complete the catalogue. /i^, for insert. Cobbett calls this sign " the blunder mark." ' The apostrophe before the s of the possessive, and to mark contractions or t by the writer 01 :ome back?'" ll e asked me whei| or expressions ite out of place iij nly a Covenanter.] still more abrup lat these signs arl y are, however, aa )n with the rest end." " Nought's got, all's spent When our desire is had without content." This latter use should be mainly confined to poetry. 11. Capitals are properly employed to mark ; — The first word of a sentence, or a line of verse. The first word of a direct quotation. The first personal pronoun, I, and the interjection, O. Proper nrmes, high titles, and names of the Deity. Very emphatic words, and names of personified objects. 12. Italics are admissible to emphasize. They are of frequent and hardly ivoidable occurrence in short treatise like the present, to mark a portion of a sentence paragraph to which special attention has to be called. But, in ordinary writing, e fewer italics we use the better. LETTER WRITING. The essential requisites of any letter are accuracy and clearness, accompanied first, correct Spelling; second, legible Writing; third, good Grammar; and [iiirth, proper Arrangement. 1. Correct Spelling is a very rare accomplishment among the majority of people 302 Perhaps there is no part of our education the neglect of which receives so littl charity as this. Yet, when we look for that system of classification and application o general rules and principles in this, which is found in every branch of study, we fine that EXCEPTION soon becomes the rule, and the pupil is obliged to rely upon memory or^he eye and unremitting practice for the orthography of almost every word. We Spell only when we write. — Therefore, spellinf{ is best acquired b constant practice in copying from good authors, writing from dictation, or compositi; and correcting original essays. These exercises are, at the same time, an efficient training in penmanship and grammar. Copying from a printed page should form a daily exercise, until entire pages ca be correctly transcribed from dictation. Such an exercise gives practise in reading translation, spelling, punctuation and the use of capitals. It also cultivates a habii o accuracy in transcribinc;, which is a most desirable acquisition. It is safe to predict that not one in fifty, who has never attempted it, can cop an entire page without a mistake. Let those who doubt, try it. 2. Penmanship. — Penmanship is to a letter what dress is to the appearance an individual ; and no one can deny the deciding influence of dress. Nor does thi attire of a gentleman become him less, because knaves and fools sometimes assume th| same. Never apologize for bad penmanship, especially where it is habitual. It is f: from refreshing to the recipient, to read such uninteresting commonplaces. Eith write respectably, or submit to such reflection as your bad writing must inevitabl suggest, whether excused or not. Indolence or carelessness, are, in nineteen cases o of twenty, the only obstacles in the way of a good, fair, legible handwriting. A little earnestness, industry, carefulness and perseverance, will overcome difficulties. Elegant penmanship is not the subject here proposed, but a gooi readable business handwriting. ^ In accomplishing this, three essential particulars must be observed, \\i Legibility, Uniformity and Spaces. 3. Grammar. — Remember, letter-writing is talking on paper ; but we must ta| on paper more carefully than many of us are accustomed to talk with the voice common conversation, redundancies, bad grammar and inelegant expressions, if thi do not pass unobserved and uncriticized, may at least be excused and soon forgottei but in a letter they remain permanent witnesses against us. Make it a rule never commit to paper, expressions you would be ashamed to acknowledge should thi confront you afterwards. If spoken vulgarisms are bad, what shall we say of sui expressions put upon paper and sent to one's friend ? Think of the letter you writing, as a record which may be preserved by your friends long after you have cea: to be among them ; and commit nothing to the permanence of ink and paper tl can possibly throw a shade upon your memory. 4. Arrangement. — In all letters, whatever be their class or subject, attenti must be paid to certain conventional forms for arranging the several parts of whi they are composed. - Every letter is regarded as consisting of six essential parts : i. The locati and date. 2. The name and address of the person to whom it is written. 3. T complimentary address. 4. The body of the letter. 5. Complimentary closi 6. The signature of the writer. receives so liitlcj and application o| of study, we find rely upon memor)i ivery word, best acquired hi ;ion, or composing time, an efficienij til entire pages caij tractise in reading :ultivates a habil ol mpted it, can copj I the appearance ess. Nor does thi tmetimes assume thl J habitual. It isfJ imonplaces. Eithd ting must inevitabj n nineteen cases ou mdwriting. ;, will overcome iposed, but a fiooj be observed, viJ er ; but we must ta| k with the voice. it expressions, if thj 1 and soon forgotteJ ake it a rule never f lowledge should thj shall we say of suj of the letter you i after you have ceaa of ink and paper tlj s or subject, attentil several parts of whil .30.*^ The location and the date should both be written on the same line, near the RIGHT upper corner of the sheet. The name and title of the person to whom it is addressed follow on the next line or two below, near the left side of the sheet, and the address, on the line underneath that, a little to the right. The complimentary address follows on the line below the address, beginning a little to the left of it. The bady of the letter should be commenced very nearly under the last letter of the complimentary address. The complimentary closing should begin very nearly under the last letter of the body; and the signature very nearly under the last letter of the complimentary closing, as illustrated in the following : FORM OF A LETTER. (l.(K-.-ition .111(1 Date.) BeUtville^ Nov. is/, 1894. or (11/1/94.) (Nnme and title of the person addressed.) John Smith, Esq., (Address.) PlC/Oft, Ont. (Complimentary Address.) Dear Sir,— (or : — ) (Mudy of the Letter.) We respectfully call your attention to our statement of account, rendered October ist, a settlement of which at your earliest convenience will greatly oblige, (Complimentary Closing.) Yours respectfully, (Signature.) W. A. ROBLIN. If the title Mr., Messrs. or Mrs. be used, the period must be affixed, to show that it is an abbreviation of the word for which it stands. Mess, should never be used for Messrs. It is in bad taste. It is but an abbreviation of an abbreviation. If you cannot afford to write Gentlemen or Sir in full, omit it altogether. Never write Gent, nor Gents,^ nor Sr. for Sir. Although Gent, is used occasionally, and even justified by good authority, it is abrupt and often offends. Never write Dr. for Dear, before Sir. Your correspondent will hardly believe himself very dear to you if you cannot afford to write so short a word in full. folding letters. It is important to fold letters correctly and neatly ; carelessness in this matter indicates either want of training and experience, or, slovenly habits, and creates a poor impression of the writer in the mind of his correspondent. The manner of folding a letter is the following :— First fold the sheet up from you to about y^ an inch of the top, taking care to get the edges exactly even ; next fold from the right inwards about ^, and then from the left inwards a little less than J4- The letter will now have three folds, and is ready to slip into the envelope without any turning. Ml m lirts: I. Thelocatii filing letters. it is written. 3- 1| There are many ingenious styles of files and cabinets now provided for, and omplimentary closiil largely used in offices for filing letters and papers, but a large number of business men still follow the- old method of filing in monthly packages. ^04 c Letters should be preserved in some form, and in such a way as to be available in the future without delay. After a letter has been replied to (if important, the reply should be copied in the copying press letter book), it should then be backed up and filed as follows : — Matten the sheet out ; fold }i of it up, and the balance over once. The letter will now have two folds (each the full lenp;th of the sheet) and present ^ of the original size. On one end write the name of the writer and his location, and the date of the letter. Keep the letters thus backed up, in pigeon holes or a box, till the end of a month, then arrange them on a table according to dates, and collect them in a package, the dates running in consecutive order from the first of the month till the last. On a sheet of paper exactly the size of the package, write the month and year about the centre, and place it on top of the package, and either tie tape round ca( h end or use rubber bands. Place this package on top of the last one, in the desk, pigeon hole or cabinet. (See also p. 73.) u it o • < On X C^ 00 > ^ « u ■9, GENERAL REMARKS ON LETTER WRITING. Margin. — On the left of your page there should be given a liberal margin of, say, three-quarters of an inch, or a little more, with which the writing is not to interfere. Location and Date. — The location and date of a letter is one of the most im- portant parts. The whole legal bearing of any letter may be destroyed by the omis- sion of this essential part ; you cannot be too careful in stating it correctly and fully. In writing from any place, care should be taken to mention the Province, and some- ■ times the county, as there may be more than one post office of the same name in Canada. The order in which the words of the location and date are written, varies some what. For instance, English letter writers generally place the day before the month, as: ist Jan., instead of Jan. ist. The former is the more natural arrangement, but custom in this country generally favors the latter. Another way of dating is to express the month by number, and in this the English system and the system on this continent differ. 2-11-94 would mean in an English letter, second day of the eleventh month of 1894 ; in an American letter it would mean the second month and the eleventh day. bers sense in this name, Brown siohal applic other. SOS ) be available in rtant, the reply backed up and ice. The letter esent /a of the >cation, and the )r a box, till the 1 collect them in e month till the month and year tape round ea< h hole or cabinet. liberal margin of, writing is not to| le of the most im- )yed by the omis- orrectly and fully. ovince, and some- he same name in| itten, varies some- before the month,! s country generally ., and in this the would mean in an| American letter it Namb and Title— I. Names. The first name ot a person as: William, Kobert, Jane, Mary, etc., is called the Christian name ; while the last, as : Brown, Smith, Wilson, etc , is called the Surname. In addressing letters to persons, it is always best to use the same form as that adopted in their own signature, with the addition of the proper title. When (ather and son have both the same name, Robert Jones, for insoince, the lather is addressed as Robert Jones, Sr., or Senior, meaning older, and the son as Robert Jones, Jr., or Junior, meaning younger. There has grown up, in this country, an array of titles and addresses which, though perhaps not so numerous or cumbersome as those of Europe, are nevertheless guarded as strictly from violation by laws of etiquette. Many of these titles, or expressions of respect, are clearly traceable to their foreign origin. For example, Mr. from Master ; Mrs. from Mistress ; Miss from the French Demoiselle ; Esq. from Esquire, This is a very common title of respect in this country and in the United States ; it is perverted from its original signification, however, and applied almost indiscriminately to all classes of males. Originally a title of respect, it now signifies nothing at all. Yet its omission might, in some cases, cause offence, though the person addressed could lay no claim to it. In England, several hundred years ago, there were five classes of dignitaries to whom this title belonged, viz.:— 1. The eldest sons of knights, and their eldest sons, in perpetual succession. 2. Such as were created Esquires by the King's letters patent, and their eldest sons. 3. The eldest son of younger sons of peers, and their eldest sons in perpetual succession. 4. Such as were Esquires by virtue of their offices as Justices of the Peace, and others who bore any office under the Crown. 5. Later than the origin of these classes, and, it is said, by usurpation, the mem- bers of the legal profession were universally recognized by this title. But they have enjoyed it so long that it has become, both in England and in this country, an established distinction. The word gentleman originally indicated wealth and education, and signified that the bearer of the title was able to live in idleness, or, at least, without personal exertion to support himself. The historic significance of the term was long since lost through its indiscriminate application to all men. When a word becomes applicable to all men, it necessarily ceases to be in any sense complimentary. This is precisely the condition of the two words Esquire and Gentlemen, as used in this country in business or other correspondence. Titles may be divided into two classes, viz. : Titles of respect as : Mrs., Miss, Mr , Esq., etc., and professional titles, as Dr., Rev., L L.D., etc As a general rule, two titles of the same class should not be applied to the same name, " Mr. Wm. Brown, Esq." should be either " Mr. William Brown " or " Wm. Brown, Esq." If the profession of the person is known to the writer, the profes- siohal title alone should be uesd. Where there are two or more professional titles applicable to the same individual, the highest should be used in preference to the other. , ' 306 «U< ,„ C>A .'I I Custom places mere titles of respect (except Esq.) before the name, which is not uniform in the application of professional titles, some preceding and others following it. For instance, Dr., Rev., Hon., and military titles should precede the name, while M.IX, A.M., LL.D., F.C.A., etc., should follow it. It is considered more respe^ful to write titles of high rank in full than to abbreviate them. Address. — The address of the person to whom you are writing should always be upon the sheet containing the body of the letter, so that, in case the letter be- come separated from the envelope, it may not be lost for want of direction. Custom has of late favored placing both the name and address at the head of the letter instead of at the close, as formerly. This arrangement appears more sensible, as in case it is received by the wrong person through mistake, it can be discovered before reading the letter through. This plan also facilitates addressing the envelope when several letters are written at the same time. Complimentary Addresses. — In writing to a gentleman, with whom you have little or no acquaintance, the address should be simply " Sir ; " if you are on familiar terms " Dear Sir " may be used. •' My Dear Sir " implies still greater intimacy. In addressing a lady not a relative, "Madam " or " Ddar Madam " may be used, according to the degree of intimacy. Unmarried ladies are sometimes addressed as " Miss," " Dear Miss," " Dear Mary," and so forth, according to the degree of intimacy. In addressing a firm or association of individuals, comprising a Committee, Board of Trustees, or other body," Gentlemen," or " Ladies," should be used, accord- ing to the sex of those comprising it. ' You may address a man who has a right to the title as. Captain John Smith, Major Robert Brown, Prof. John Mowat, etc , but it would display excessively bad taste and ignorance for a man to sign his name with the title in front. The proper way is, John Smith, Captain ; Robert Brown, Major ; John Mowat, Prof, of Mathe- matics University of Toronto. A woman should never sign, for example, Mrs. John Brown, but Mary Brown, her own name. Body of the Letter. — The body of the letter should be made up of paragraphs. Every change of subject should be indicated by commencing a new paragraph to the left of the middle of the sheet, and about an inch farther to the right than the other lines. The opening paragraph should always be short, and unfold, if possible, the object of the letter. If it is a reply, it should announce the receipt and date of the letter to which it is an answer, and should give a brief statement of its subject matter, that all cause of misapprehension may be explained or removed, thus : — "Your favor of the ist inst., relating to the sale of your books in this city, is received, &c." If the letter is one of business or inquiry, dispose of the first ; and unless on familiar terms, never introduce other matters. If the letter is to be short, it should be commenced so as to leave an equal space above and below. No error is more frequent among beginners than the use of the small / instead of the capital / in writing of themselves. This pronoun occurs frequently in letter- writing, and such a display of ignorance should be carefully guarded against. Ii fritten return( prompi T l)oth p W ■niddlc 307 ine, which is g and others PRECEDE the is considered m. hould always the letter be- Lon. Custom I letter instead by the wrong hrough. ;ers are written dom you have are on familiar intimacy. '• may be used, s addressed as the degree of a Committee, )e used, accord- in John Smith, excessively bad t. The proper Prof, of Mathe- example, Mrs. ip of paragraphs. laragraph to the than the other if possible, the and date of the 5 subject matter, i in this city, is t; and unless on e short, it should e small i instead jquently in letter- against. Proximo (or prox.) means the next month; Ultimo (or ult.) means the past month ; Instant (or inst.) the present month. The first letter of every sentence, title, proper name or adjective derived from i; ; every name applied to the Deity ; every quotation of the words of another ; every line in poetry ; the words I, O and Oh, the days of the week, months of the year, and the principal words in rules and headings, should be capitals. The names of the seasons should not be commenced with a capital letter. The tendency among beginners is to use too many capitals, especially if the writer prides himself on his dexterity in making them. Except in one of the cases above enumerated, or when in doubt, use a small letter. Do not begin a sentence till its wording is clearly 6xed in the mind. Never add clause after clause, loosely linked on with " ands " and " buts," till you are led to say what you do not mean, instead of having expressed the thought intended. Complimentary Closing. — The complimentary closing, like the complimentary address, usually consists of a phrase more or less formal in its character, regulated by the degree of familiarity between the parties. It generally consists of some such expression as : " Yours truly," "Yours respectfully," *' Your sincere friend," "Yours faithfully," &c. The closing sentence of the body of the letter should be framed so as to connect smoothly with the complimentary closing, as : " Hoping to hear from you soon, " I am, " Yours respectfully, "JOHN SHORY." Signatures. — The importance of an appropriate signature is much greater than I is sometimes supposed. Different tastes will suggest different styles, such as the bold, coarse hand, the I condensed hand, back hand, fine hand, etc. : but it matters little what style is chosen I for one's signature, if it be suited to the sex of the individual and length of the name. The liability of being counterfeited should be carefully guarded against. To this end, the signature once adopted should not vary, so that continued practice may give lit a character which would be difficult for an unpracticed hand to counterfeit Some peculiarity of combination or arrangements of the part may be observed. When the [temptation to counterfeit is great, as is the case with the signatures of persons in [important offices, some private mark, likely to pass unobserved by the common eye, [is frequently resorted to as a security against forgery. ETIQUETTE OF LETTER WRITING. In general, every letter requires a reply. It is as necessary to answer when Imtten to as when spoken to. Letters considered disrespectful or insulting should be leturned at once, without a reply. Letters of business or courtesy should receive prompt attention. Two persons should not write in the same letter, unless in family letters, or when |both persons are very intimate with the correspondent. When ceremony is required, letters should be commenced a little above the Diddle of the first page, and, if there is not sufficient room to finish it on the first 308 c: page without bringing the signature too near the bottom, it may be finished on the inside sheet, on the right hand page. In such cases there should be at least two or three lines of the body of the letter upon the next page. It is considered impolite to write other than business letters on a half sheet of paper ; therefore, unless from necessity, always use a whole sheet. In business letters, when you require to use the second sheet (or any number more than one), write the initials of the person or firm you are writing to on top and follow this with the number, as R. & J. p. 2, on the second sheet of a letter written to Robinson & Johnson. In letter writing, be particular and use a sheet appropriate in style and size to the purpose for which it is employed. For example, it would be considered bad taste to write a business letter upon colored note paper. The judicious selection and use of paper should be carefully attended to. Envelopes should be either buff, white or some other plain color, and quite thick. Avoid all fancy patterns and colors. Postscripts are sentences inserted after the body of the letter is finished. They indicate either haste or thoughtlessness, and should, in general, be avoided. Writing around the margin of a letter should likewise be avoided. Letters of recommendation or, introduction should not be sealed when intended to be delivered by the person to whom they relate, as he ought to know the contents. Superscriptions. —The superscription of a letter means the address of the person to whom it is sent, written upon the envelope enclosing it. The form of arrangement should correspond with the same address at the head of the letter. Care should be taken that it is distinctly written. From neglect of this precau- tion, hundreds of letters are sent every month to the dead letter office. Commence the superscription about the middle, and to the left of the centre of the envelope, so as not to crowd upon the right edge or bottom. Before writing the superscription ascertain if the envelope is right edge up. It is in this position when the part on which the gum is usually placed folds under from the top of the envelope. Never scratch or draw faint lines upon which to write the superscription. Stamping. — The customary spot for placing the requisite postage stamp is on the right hand upper corner of the envelope. For business letters use No. 5J^ or 6 envelope, and observe the following FORM OF SUPERSCRIPTION. STAMP. P. O. Box 547. Henry A. Mundell, Esq., Hamilton, Ont. 309 >hed on the least two or lalf sheet of any number o on top and ;ter written to 2 and size to )nsidered bad selection and her buff, white ind colors, nished. They ided. Writing when intended w the contents, address of the The form of the letter, t of this precau- pe. Commence the envelope, so t edge up. It is olds under from ich to write the PARTICULAR LETTERS. Letters are generally classed under two heads, viz. : Letters of Business and Letters of Friendship. It is not our intention to treat of the latter, although the foregoing remarks apply to both classes. Letters of Business. — The characteristics of a business letter are Brevity and Clearness. Business letters are expected to be as brief as the subject will possibly allow. Unnecessary words are a waste of time to him who writes and to him who is obliged to read them. Few who have not had the actual experience can understand the labor of opening and reading fifty or a hundred letters ; and when we consider that some large firms receive several hundreds daily, whose contents must be read and considered, frequently through the most shockinij penmanship and grammar, we can imagine why letters filling a whole sheet with business which should be despatched in a dozen lines are never read at all. In reading his correspondence, the man of business habits grasps not merely the meaning of words, but whole sentences at a glance, and extracts the important points of the letter and object of the writer almost instantaneously. Before commencing a business letter the writer should ask himself: i. How many different points do I wish this letter to contain ? 2. Can I embody all I wish to say upon each point in a single sentence ? 3. If I cannot, how few sentences WILL suffice? After the letter is completed, the following questions should be answered : i. Have 1 included all the points or subjects I intended to write about ? 2. Are they expressed in a brief and clear manner ? 3. Can the language be misconstrued ? The arrangement or form of a letter should be such as will answer cjearly the three questions which always arise on unsealing any letter :— i. Where is this letter from ? 2. Who wrote it ? 3. What does the writer want ? tage stamp is on following LETTERS OF INTRODUCTION. A few words here may not be out of place in regard to loiters of introduction. It may be feared that they are sometimes given without due reflection and discrim- ination, if not for the purpose of getting rid of disagreeable importunity and of shirking an intolerable nuisance. There are certain well-known rules, founded on good sense, that ought always to guide, not only in regard to letters of introduction, but also in reference to giving verbal introductions : — 1. You should never give such a letter to be used by one in whom you have not entire confidence. 2. Having this confidence in your friend, to whom you desire to extend a favor, do not impose upon him by giving a letter directed to one who is unworthy of his confidence. He may become a sufferer in consequence of it. 3. Never accept such a letter, and be the bearer of it, from a person in whom you have not full confidence. Your own character may be suspected on account of it. 310 C Ott*.. 1 1.1 't 4. Be sure that your own relations to the party to whom your friend seeks an introduction are such as to warrant you in giving the letter. Otherwise that friend may 6nd himself in an awkward predicament. 5. If the letter is of a business nature, through which pecuniary credit is sought, be very careful what you write. Bear in mind that you may be held responsible before a court and jury for the contents of your letter. 6. Remember you have no right to thrust one of your acquaintances upon the attention of another, unless you are confident that it will prove mutually agreeable or advantageous. ' The following letters are not intended to be perfectly adapted to the wants of any business man ; but, taken in connection with the foregoing instructions, a few such letters may serve as general guides in the structure and literature of business epistles. The general tone, air, dress, modes of expression, complimentary terms, how to begin, how to close a letter, etc , etc., may be gleaned from them. LETTER OF INTRODUCTION NOT INCURRING LIABILITY. Hamilton, Oct. 29, 1894. Messrs. David Torrance & Co , • Montreal, Gentlemen :— This will introduce to you, the bearer, Mr. H. T. Willis, a merchant of good standing in this I city, who wishes to confer with you on business, the nature of which he will himself explain. Yours respectfully, THOMAS SMITH. -LETTER OF INTRODUCTION INCURRING LIABILITY. London, Oct, 26, 1894. Messrs. Geo. Winks & Co., Montreal, Gentlemen :— Allow us to introduce to you Mr. J. B. Ashley, a merchant of this city. You may consider usl responsible for goods that he may purchase from you, to any amount not exceeding four thousand| dollars, on condition that you notify us immediately should default be made in payment thereof. Yours truly,' , JONES & BROWN. INTRODUCING A FRIEND. Belhvilh, Out,, Sept. 4, 1894. Henry Brown, Esq., Halifax, N. S. Dear Brown :-- This will introduce to you the bearer, Mr. W. E. Embury, who visits your city for the purposJ of making arrangements to engage in the Grocery business. I have much pleasure in assuring you that he is a young man of strict integrity, superior abilityl and in every way worthy of^your entire confidence. Any assistance you may find it in your power to render him, I will regard as a personal favor iJ myself, which I shall be happy to reciprocate whenever an opportunity shall offer. Yours very ti\ily, SAMSON SMITH. *The Statute of Frauds passed in the reign of Charles II, and still in force in Canada as in England, requires tliaiij tijnd one party for tl)e 4et>( pf another he must have bound himself in writing. DeaI remiJ TrusI 311 riend seeks an me that friend redit is sought, eld responsible ances upon the lly agreeable or to the wants of tructions, a few iture of business limentary terms, lem. ABILITY. , Oct. 29. >894- good standing in this | self explain. IAS SMITH. ABILITY. «, Oct. 26, 1894. You may consider usi Kceeding four thousand| jayment thereof. S & BROWN. Ont., Sept. 4. >894- ur city for the purposJ tegrity, superior abiliiyl d as a personal favot H tffer. M SON SMITH. in England, requires iliiitij The superscription on the envelopes (which are left open) enclosing letters of introduction should be thus : — Henry Brown, Esq., Halifax, MS. Introducing Mr. W. E. Embury, ENCLOSING STATEMENT OF ACCOUNT AND REQUESTING A REMITTANCE. Mr. Wm. Smith, Cobourg, Ont. Toronto, Aug. 25, 1894, Dear Sir:— Your attention is called to the enclosed statement of account showing balance in our favor of one hundred dollars. As it is long past due, an early remittance will oblige. Yours truly. JAMES MANN & CO. ANOTHER IN CASE SUCH AS THE ABOVE PROVES INEFFECTIVE. Toronto, Oct. 5, 1894. Mr. Wm. Smith, Cobourg, Ont. Dear Sir :— We again call your attention to the balance of your account, $(oo, still remaining unpaid. Your promises to remit have not been fulfilled. We trust your immediate attention to the matter will obviate the necessity of our referring to it again. Yours truly, JAMES MANN & CO. ANOTHER— A LAST EFFORT. Toronto, Nov. 8, 1894. Mr. Wm. Smith, Cobourg, Ont. Dear Sir :— ' ^ Your attention is once more called to the balance of a'lount, $100, still unsettled. We expect a remittance of the same at once, otherwise we shall be compelled to use means to enforce collection. Trusting your prompt attention to the matter will render such a step unnecessary. We are, yours respectfully, JAMES MANN & CO. 312 C .iH*" ^ ANSWERS TO THE THREE FOREGOING LETTERS. ♦ Cobourgy Aug. 29, 1894. Messrs. Jambs Mann & Co., . Toronto, Ont. Gbnti!emen :— I am in receipt of yours of the 2Slh inst., containing statement of account, and have to apologi; e for my neglect to remit the amount due you— $icx3. Unavoidable circumstances have prevented my doing so. You may expect an early remittance of the same. Yours faithfully, WM. SMITH. Cobourg, Oct, 9, 1894. Messrs. James Mann & Co., Toronto, Ont. Gentlemen :— I exceedingly regret that you have once more to remind me of my account remaining unpaid, and that unexpected disappointments have caused the delay. I shall certainly remit the amount before the 15th inst. Yours faithfully, WM. SMITH. Cobourg, Nov. 10, 1894. Messrs. James Mann & Co., Toronto, Ont. Gentlemen : — I cannot wonder at the tone of your last communication, as my conduct has been such as to justify the same. With this I remit the amount due you— $too, and much regret the long delay. Please acknowledge receipt by return of mail, and oblige, You*'s faithfully, Enclosure. WM. SMITH. NOTICE OF DRAFT SENT TO DRAWEE Belleville, Sept, 14, 1894. Mr. Wm. Brown, Kingston, Ont. Dear Sir :— We have this day drawn on you through the Bank of Montreal, at ten days' sight, for the amount of your account, as per statement herewith enclosed. Please honor, and oblige. Yours respectfully, S G. BEATTY & CO. , per J. REMITTANCE TO ENGLAND. ... Belleville, Ont., Can., /any. 5, 1894. Messrs. Leaf, Sons & Co., London, Eng. ' • Gentlemen :— Herewith enclosed you will please find the first bill in a set of exchange No. 578, issued by th( Bank of Commerce here, for the sum of £397. 12. 6, payable at three days' sight, at the Nationa Bank of Scotland, London, with which please retire my acceptance in your favor due on January 20. Please cancel and return the acceptance in course of mail, and oblige Yours faithfully. Enclosure. J. W. JOHNSON. Note. — The letter previous to the last is written by a clerk named Jones, who places the last initial uf I name under the n htm. your space any ti SRS. iug. 29, 1894. i have to apologi. e lave prevented my SMITH. ', Oct. 9, 1894- maining unpaid, and . the amount before SMITH. Nov. 10, J 894. jeen such as to justify mg delay. VM. SMITH. e, Sept, 14, 1894. i' sight, for the amount BEATTY & CO. per J. ty. 5. »894- No. 578, issued by the i' sight, at the Nationa vor due on January 20, 3HNS0N. places the last initial xfhil 313 APPLICATION FOR A LINE OF DISCOUNT. .' - Toronto, Janiiafy 10, 1894. ' B. E. Walker, Esq., General Manager Bank of Commerce, TotoHlo. Dear Sir :— I desire to secure a line of discount at the Bank of Commerce, not to exceed ten thousand dollars, and respectfully ask your consideration of the matter. The paper I shall offer will be the notes and acceptances of my customers, none of it extending beyond ninety days. I enclose a copy of my last balance sheet, showing my profits for last year and my present capital, and I shall be pleased to give you any further information you may desire. Yours respectfully. W. B. ROBINSON. REQUESTING PERMISSION TO DRAW A DRAFT. Belleville, May 5, 1894. Messrs. James Grant & Co., Montreal. Gentlemen :— ' My note in your favor for $500 will be due at the Bank of Montreal here on the 9th inst. , and I shall not be able to raise more than $300 towards paying it. Will you kindly permit me to draw upon you at sight for $200, and for this amount, with interest and cost of collection added, please draw upon me at ten days' sight. , Yours respectfully, WILLIAM BROWN. REPLY. Montreal, May (>\\t, \%9^. Mr. WillIam Brown, Belleville. Dear Sir :— Your letter of the Sth is received, and we hereby authorize you to draw upon us at sight for ^200, to assist you to pay your note in our favor due on the 9th inst. We shall honor the draft, and, as requested, draw back upon you for the $200, adding interest and the cost of collection. Yours faithfully, JAMES GRANT & CO. REQUESTING RATES FOR ADVERTISING. ^ Belleville, August 9, 1894. Messrs. The Mail Printing Co. (Limited), Toronto. Gentlemen :— Please quote your lowest rates for advertising in the daily and weekly Mail. We purpose, if your rates are satisfactory, to occupy 40 lines in the daily, e. o. d., for four months, and the same space in the weekly for six months. You might also please give us your quotation for one thousand lines to be used at our option at any time within a year. Yours faithfully, ROBINSON & JOHNSON. ■ m Mm „«i*^ 814 NOTICE TO DIRECTORS TO ATTEND A MEETING. Toronto, September 19, 1894. R. J. Patterson. Esq., City, Dear Sir :— Men are hereby notified to attend a special meeting of the directors of the Ontario Transportaiion Company (Limited), to be held at the office of the Company, 91 King street, on Friday, the 2 ud instant, at 3 o'clock p. m., for the purpose of considering the question of issuing new stock to the extent of one hundred thousand dollars. I am, Your obedient servant, H. W. EDDIS, Secretary. REMITTANCE TO NEW YORK. Belleville^ Out., August 3, 1894. Messrs. T. Morton & Co., 91 Broadway, Nezv York^ Gentlemen :— Enclosed herewith we beg to hand you New York Exchange, in settlement of your invoice of the 1st. inntant, less cash discount. Please acknowledge receipt by return mail. Amount of invoice $230.00 Cash dis. 5 per cent. 11.50 Draft herewith for 218.50 The goods have been received, and are very satisfactory in both quality and price. You may expect another order soon. Yours faithfully, JOHN DUNCAN & CO. When letters are opened containing remittances, it will be found very convenient to have a rubber stamp with the following upon it to stamp upon the letter or bill accompanying the remittance : — This communication was received When opened it contained Cash $ Stamps Signature^ C. B. Folio I Appropriated to, (Name the account or accounts and the respective sums.)* Signature. A YOUNG MAN GOING WEST. Cobourg, Ont., March 31, 1894. John Henderson, Esq., » Vancouver, B. C. Dear Mr. Henderson : — You were kind enough to say in a letter received from you recently, that if I thought of goini; ou West at any time you would be glad to assist me by your advice and influence to secure a position and I desire now to avail myself of your kindness. I have a thorough knowledge of book-keepin and accounts, having completed the course at Ontario Business College, Belleville, under practica and experienced accountants, and I should like employment in that line. In the course of a few weeks I shall have the pleasure of calling upon you and presenting m testimonials, I am, , . ( . ■ \ ' - Yours sincerely, W. P. KILGORE. W. riNG. ember 19, 1894. itario Transportation or> Friday, the 2 ud ig new stock to ilie J. EDDIS, Secretary. August 3, 1894. of your invoice of the and price. You may UNCAN & CO. nd very convenient 1 the letter or bil e. e. , March 31, 1894- F I thought of going ou ;e to secure a position vledge of book-keepin Ueville, under practica you and presenting N. P. KILGORE. 315 NOTIFYING THE MAKER OF THE MATURITY OF HIS NOTE. Onvego, N, Y,, June 5, 1894. Mr. a. W. Fell, ^ ^^ Ox Bmv, N. Y. Dear Sir :— We beg to remind you that your note in our favor for $Soo, drawn at four months from February 15th, 1894, will be due on June 18th at the First National Bank, Oswego, and we respectfully request that you will make provision for paying it. We are, yours truly, JOHN BOGART & SON. ADVERTISING STOCK OF GOODS FOR SALE. Tenders are hereby invited for the purchase of the stock in trade, the shop furniture and the book debts, of John Doe, of the City of Belleville, insolvent : The stock is composed of the following, (as given in detail in the inventory) : — Dry Goods $7890.00 Carpets and House Furnishings 2310.00 Millinery 1500.00 Shop Furniture ... , 860.00 Book Debts ,.. 1729.00 Tenders are to be addressed to the undersigned and will be received up to noon of the 1 8th day of March 1894. The highest or any tender not necessarily accepted. Parties desirous to purchase can obtain access to the store and to the inventory, and can also see the schedule of book debts. W. N. PONTON, Dated at Belleville Assignee. the 25th day of February, 1894. A TENDER FOR ABOVE. Belleville, March 10, 1894. W. N. Ponton, Esq., Belleville. Dear Sir : — I hereby make the following offer for the assets of the estate of John Doe as advertised by you in the Belleville papers : I will give fifty cents on the dollar for the dry goods, carpets and house furnishings ; twenty-five cents on the dollar for the millinery and shop furniture ; and forty cents on the dollar for the book debts. I will pay down one-half in cash on obtaining possession, and give my notes at three and six months, without indorsement, for the balance. Yours faithfully, THOMAS ROE. PROPOSAL TO FORM A JOINT STOCK COMPANY. Belleville, October, 25, 1894. John S. Porter, Esq., Toronto. Dear Sir : — We purpose converting our business into a Joint Stock Company, under Dominion Letters Patent. The capital stock will be $50,000, divided into shares of $100 each. Our plant and manufactured goods amount to $25,000, and we propose to turn these over to the company and accept payment in paid up shares. The balance of the stock is for sale at par, and we would be glad to have your subscription for, say, ten shares. Yours f&ithfully, G. & R. PRINCE. ill; c "» /* 316 A contract is made in the four letters which follow : ' loronld, On/., Canada, Ocl. 35, 1894. Messrs. J. C. Wells & Co., New York, GBN')i(.BMEN :— I have been holdini; 20,000 bushels of No. 1 Barley hoping fur a rUe in price, but I h ue concluded, in view of .the present condition of the market, to sell for any reasonable offer. Are you disposed to buy that quantity ? II you are, I shall be glad to have an offer. Yours faithfully, G. W. lOHN.SON. Ne%v York, October 38, 1894. G. W. Johnson, Esij., Toronto, Out. Dear .Sir:— Your favor of the 25th is received. In reply we beg to say that we have a customer for 20,000 bushels No. i Canadian Barley at a price. We shall wire him to-day, and on receipt of his answer will probably be in a position to make an offer. At any rate, we shall write you again in a day ur two. Yours truly, [ G. WELLS & CO. New York, October list, ii<)^. G. W. Johnson, Esq., Toronto, On\ Dear Sir :— ' Referring to your letter of the 25th inst., and our reply of the 28th, we hereby mike you an o^Ter of eighty-two and ^ cents (.82j^c.) a bushel for 20,000 bushels No. i Canadian Barley, delivered f. o. b. New York Central cars in New York. If the offer should be accepted, shipment may be made at once, and you may draw at sight for the amount, attaching the b/1 to the draft. Yours truly, J. G. WELLS & CO. Toronto, Ont., November yd, 1894. Messrs. J. G. Wells & Co., New York. Gentlemen :— Your favor of the 31st ult. is received, and your offer of eighty-two and % cents (.82^'c.) a bushel for 20,000 bushels No. i Canadian Barley, delivered f. o. b. N. Y. C. cars in New York is hereby accepted. In accordance with the offer and acceptance, I have shipped that quantity to the order ul the agent of the Canadian Bank of Commerce to-day, and have drawn upon you at sight, as requested, for the amount, and have attached the bill oi lading to the draft. ^ ■ Yours faithfully, G. W. JOHNSON. REQUEST FOR THE RENEWAL OF A NOTE. Sherbrooke, Que., Sept. 18, 1894. Messrs. Robert Lynch & Co, Montreal. <• Gentlemen :— ' * I regret that I am obliged to request you to renew for one month my note in your favor for -Sf^oo, due at the Banque du Peupie, Montreal, on the 24th inst. If you will kindly consent, and send new note for the amount of the old one and interest on the renewal, I shall sign and return it be; fun the 24th. ' • Yours faithfully, L. R. HARRIS. , Oct. 25, 1894. I price, but I h ive ible offer. Are ynu JOHNSON. 7ctolier a8, 1894. I customer for 20,(100 receipt of his answer ou again in a day ur LLS & CO. aoiier 3 If/, 1894. !by mike you an olTer dian Barley, delivered ted, shipment may be le draft. ^ELLS & CO. vernier yd, 1894. ents {.S2)ic.) a bushel 1 New York is hereby [uantity to the order ol I at sight, as requested, 317 ♦REQUEST FOR THE EXTENSION 01^ A NOT^fe Mrssrs. Robert Duncan & Co., ' ^ ' ^ Toronto, Gl'.NTLEMEN :— > Will you kindly retire my note for #360, drawn in your favor and payable at the i.mk of Commerce, Toronto on the I3lh instant ? 1 have had an unexpected call for funds, and shall |i« short on that date. If you will kindly hold the note for ten days, I shall remit the amount ; or, if you prefer, you may draw upon me at ten days dale on the 13th, and I shall duly honor the draft. Yours respectfully, A. C. HAKER. f QUOTIN(; PRICE FOR ADVERTISING. , ^ Toronto, Oct. 29, 1894. Mr. John S. Gill, . v. y-» Oshaiva. Dkar Sir :— In reply to your favor of the 28th we bjg to say that you can have one thousand lines in the daily TRIBUNE to be used at your option at any time within a year, at the rate of seven cents a line. We shall make a draft at sight for the space used at the end of each month. Yours faithfully, THE TRIBUNE PRINTING CO., (Limited.) Per John Brown, Manager. TENDERS FOR DEBENTURES. Tenders are hereby invited for the purchase of Debentures of the City of Belleville, Ontario, to tho amount of Seventy-five Thousand Dollars. These Debentures are issued under the authority of By-Law No, 169 of the said City of Belleville, and are to run for the period of twenty years from the first day of May, 1894, with interest coupons attached, payable half-yearly at the rate of four per centum per annum. Due provision will be made for the redemption of the said Debentures by the levy and investment of a Sinking Fund yearly. The said Debentures are issued in sums of five hundred dollars each. - Tenders will be received up to noon of the 5th day of June, 1894, and are to be addressed to the undersigned city clerk. The highest or any tender not necessarily accepted. J. E. WALMSLEY, Mayor, D. B. ROBERTSON. Dated at Belleville, Ont., March 20, 1894. City Clerk. V. JOHNSON. >TE. \e., Sept. 18, 1894. in your favor for §600, ly consent, and send [n and return it bt^for IRRIS. ORDER FOR GOODS— No. i. Cobourg, Sept. loM, 1894. Messrs. Geo. Ritchie & Co., Belleville, Ont. ' Gentlemen :— Please forward by G. T. R., at your earliest convenience, the undermentioned articles, for which I shall remit on receipt of bill : — 6 doz. Men's Linen Collars, "Magdala," size 15) ins. 2 " White Silk Neckties, i & i^ ins. 12 " pairs White Kid Gloves ''Alexandres," sizes— 6 & 6}. 12 " " " " " •• assorted 7J to 8J. 2 only B. S. Silk Umbrellas. Yours truly, J. WILSON. * There would be no risk in holding the above note, as there is no indorser upon it. IT there was an indorser lipon it, then the holder could only be safe by giving him notice of dishonor. 318 ORDER FOR GOOUS— No a. Port Hope, Oct, lo, 1 894. Mrssrs. Ai.rx. Urquiiart & Co., Montreal, Que, GbntlAibn :— I'lease forward to our addreis per G. T. K. Freight ExprcRS : — Five (5) Half-cheiitH Young llyson, " Benefactor," No. 43. Three (3) •' Unc. Japan, " I'. B. 132," or «imilar. 1'wo (2) Uags S. S. Almonds. One (1) Case Eleme Figs (new). You may draw upon us nt sight for the amount of the invoice, le.^s the UHual cash discoun* of j per cent. Yours faithfully, PETER COOPER & CO. c li .1 10 REPLY TO ABOVE. Montrcai, 9/ 1 4, 1894. Messrs. Petkr Coopbr & Co., Port Hop*, Ont. Grntlemkn :— Enclosed find invoice and bill of lading of goods shipped you this day as per ynur valued order of the loth. We have drawn upon you at sight, as requested, for the amount of the invoice, less 3 per cent, cash discount. Trusting the goods will reach you in due season and prove satisfactory, and awaiting your further orders, we are, Yours, &c., Enclosure. ALEX. URQUHART & CO. RESPECTING GOODS NOT BEING SO GOOD A QUALITY AS ORDERED. Belleville, Oct. 24, 1894. MESSRS. Jos. McKay & Bro., Montreal. Gentlemen :— We are in receipt of the goods ordered by us through your Mr. Williams. Upon examination of the Five pes. Broadcloth (No. 4732), we find the quality much inferior tu sample, and, in our estimation, worth 25 cents less per yard than invoice price. Shall we retain them at our figures or return ? Yours faithfully, J. A. MOORE & CO. ESSKS. REPLY TO ABOVE— NO. i. Montreal, Oct. 28, 1894. Messrs. J. A. Moorb & Co., Belleville, Ont. Gbntlbmbn : — Your f^vor of the 24th is received. It surprises us to learn that the five pieces of Broadcloth (No. 4732) did not prove satisfactory in regard to quality, as we supposed them to be fully equal to sample. We are willing to accept your estimation ot their value, however, and have passed the difference to your credit, and herewith enclose credit note.* Yours, &c., JO.S. McKAY & BRO. * See form of Credit Note, page 59. Note: — When any valuable document like a cheque, draft, bill of lading or bank bill is enclosed with a letter, wrire the word enclosure as in example above. (I. 10, 1894. ash discoun* of }, ER & CO. ,/, 9/14, 1894. r>ur valued order of I invoice, less 3 per vaiting your further ^RT & CO. JALITY Oct. 24, 1894. 319 ANOTHER. AfoHtrtal, Oil. 31, 1894. IMkssri, J. A. Moore & Co., HtUevilU, Out. IGknti.kmrn :— Your favor of the a4th is before iih. We regret to learn that the 5 pcit. Broadcloth No, 4732, |ite not uliifactory, as we believed them to be fully e(|ua! to the lample. The present value of the ;()r>ds in this market will not allow us to make the reduction you speak of. .Should you not wish to |t(lnin them at ivivoice price, please hold thf m subject to our order, and oblige. Vuurs respectfully, JOS. McKAY \ BKO. RESPECTING DIFFERENCE OK WEIGHT IN TEAS. ^iKssRs. Smith, Bkown & Co., Whitby. July 21, 1894. Montreal. riENTLRMEN :— In checking over the Teas purchased from you on the 16th inst., i)y our Mr. Brown, we find the ;Hli. Cheats Y. Hyson, " Benefactor 42," deficient in weight 11 lbs., as per statement below. We ^aim allowance for the same, and have passed the amount (#8.25) to your debit. Ple.isc send us a ftedit note in acknowledgment. Yours respectfully, JONES \ BROWN. ADVICE OF SHIPMENT. Belltvilk, Nov. 18, 1894. PR. H. M. Alexander, n Montrtal. ^ tlEAR Sir :— We have this day shipped to your address, 100 Kegs Butter, as per invoice enclosed, to be sold I our account. The quality is choice, and we have no doubt it can be disposed of at good figures. Yours truly, ASHLEY & CO. ty much inferior to hall we retain them DUE & CO. , Oct. 28, 1894 ANOTHER—ON JOINT ACCOUNT. Brockville, Nov. iS, 1894. jlEssKS. Fletcher & Co., Montreal. (ENTLEMEN :— Your favor of the loth inst, came duly to hand. We accept with pleasure your offer to join in kpment of Flour, and enclose invoice and shipping bill of 100 bbls. Corby's Extra Superfine, for- larc'ed to your address this day per Str. " St. Helen." We have drawn on you at 10 days' sight for pe-half invoice, $250, as requested. Trusting that the adventure will prove of mutual advantage, we are, Yours very truly, W. C. NUNN & CO. ENCLOSING ACCOUNT SALES. )ieces of Broadcloth ■ Montreal, Nov. 25, 1894. to be fully equal to Jbssrs. Ashley & Co., Belleville, Ont., • lasseJ the difference JWilemen :— Enclosed please find account sales of your shipment of the i8th inst., also sight draft on Messrs. tty & Wallbridge, of your city, for net proceeds. Twelve Hundred Dollars. S: BRO . I Trusting that the result will prove satisfactory, and soliciting further shipments, which at all es shall receive best attention, I am, bo... .,*..«»,..... 1 Vo.,»..nrU«ly. H M. ALEXANDER. 330 ANOTHER. Montreal, * 1 1 /28/ 1 894. Messrs. W. C. Nunn & Co., Brockvilk, Out. Gentlemen : — Ei^losed we hand you account sales of your shipment of the iSth inst , on joint account. The net proceeds, $385, have been passed to your credit as averaging due Nov. 15th. We feel satisfied the result will prove satisfactory, and shall be pleased to join you in any other shipments of a similar kind. Awaiting your further esteemed favors, we are, Yours very truly, A. FLETCHER & CO. • 'n,f CM /* .Jl*" LETTER OF RECOMMENDATION. Belleville, May 2, 1894. The bearer, Mr. K. Markell, has been in our employ for the past three years as salesman and bookkeeper, and we have always found him diligent and faithful in the discharge of his duties, and willing at all times to make his employer's interest his own. He is correct and reliable in his accounts, and is well qualified for the position of bookkeeper or correspondent. We cheerfully recommend him to any who may require the services of a trustworthy and compet- ent person in the counting-house. Very respectfully, JAS. COOPER & CO. < ' - ' ANSWER TO ADVERTISEMENT. 129 Notre Dame St., Montreal, April 6, 1894. Messrs. Wright & Co , London, Ont. Gentlemen :— In answer to your advertisement in the Daily Globe of to-day, for an assistant in your office, I respectfully offer my services. I have just graduated from Ontario Business College, Belleville, where I have been thoroughly trained by practical accountants of wide experience. If you give me a trial, I shall devote my sole attention to your interests, and endeavor to acquit myself to your entire satis- faction. For reference as to my character and ability, I would offer the names of Mr. George Brown, 146 Jarvis Street, Toronto. Messrs. J. E. Dwight & Co., of your city. Should a personal interview be desired, please address as above. Very respectfully, ANSON McKIM. APPLICATION FOR A SITUATION AS BOOK-KEEPER. Messrs. T. C. Kerr & Co., Ottawa, March i, 1894. Hamilton, Ont. Gentlemen:— Having learned from Mr. S. R. Hanson that there is a vacancy for a book-keeper in your house, I respectfully offer my services. I have been engaged for two years in the wholesale house of Messrs. A. R. McMaster & Bro., Toronto, as assistant book-keeper, and have a good knowledge of accounts. My business acquaintance is extensive in the western part of the Province, and I could therefore influence considerable trade. I enclose a copy of testimonial from my late employers, and would also respectfully refer you, as to my character and ability, to Messrs. Smith & Kealey, Wholesale Grocers, Toronto. > < Messrs. Gordon, McKay & Co., Dry Goods, " . ,, F. L. fiiggar, Esq., City Solicitor, " Any communication which you may be pleased to address as above will receive prompt attention Very respectfully yours, J. II. BROWN. *ii/28 means eleventh month (November), 28th day. Note. — When making an application always send copies of the testimonials. At the head of each, write copy, :inil before the name at the bottom write in brackets (signed), then there is no forgery. /, •11/28/1894. oint accounl. The jin you in any othtr CHER & CO. e. May 2, 1894. ears as salesman and e of his duties, and and reliable in his tworthy and compet- DOPER & CO. r, April 6, 1894. tant in your office, I ege, Belleville, where you give nie a trial, to your entire satis- )f NSON McKIM. CEEPER. , March I, 1894. ceeper in your house, I esale house of Messrs. knowledge of accounts, and I could therefore ispectfully refer you, as ceive prompt attention. . II. BROWN. lad of each, write copy, and I 321 • ♦RECOMMENDATION ENCLOSED IN THE ABOVE. (Copy.) Toronto, Jan. 25, 1894. The bearer, Mr. J. H. Brown, has been in our employ as assistant book-keeper for over two years, and we have always found him honest, steady and correct in his deportment, and well qualified for any position of trust in a counting house. We cheerfully recommend him as a competent book-keeper, and one who will, we believe, earnestly apply himself to promote the interests of his employers. (Signed), A R. McMASTER & BRO. ORDER FOR A BOOK. Hamilton, Jan. 4, 1894. Messrs. Robinson & Johnson, Belleville, Ont. Gentlemen : — Enclosed find Two Dollars, for which please send me one copy of the " Canadian Accountant," (jtenth edition), and oblige. What trade discount will you allow on an order of, say, fifty copies? Yours truly, HENRY M. CURTIS. ENCLOSING ADVERTISEMENT. Pic ton, Nov. 5, 1894. Intelligencer Printing Co., Belleville, Ont. Gentlemen :— Please insert the enclosed advertisement, to occupy forty lines, for three months in weekly edition, commencing in next issue. We will remit the amount on receipt of bill, which you will please render in accordance with the contract we have with you. Yours, etc., JONES & BROWN. ASKING REFERENCES. Montreal, Oct. 20, 1894. Messrs. Geo. Ritchie & Co., Belleville, Ont. Gentlemen : — Mr. Henry Smith is an applicant for a vacancy in our office, and refers to you (as late employers) respecting his character and ability. Will you please favor us with any information that you can give about him, and greatly oblige. Yours respectfully, BROWN, WHITE & CO. CIRCULAR LETTER— ENCLOSING PRICE LIST. Dear Sir :— By this post we forward you our Illustrated Price List of portmanteaus, carpet bags, etc., and shall feel obliged if you will give it your attention. On comparison, you will find the prices very much lower than those previously sent. Any orders entrusted to our care shall meet with our best attention, both as to quality and despatch. Trusting to have a continuance of your favors, we are. Your obedieril servants, J. LYONS & SON. *When enclosing testimonials, send copies only ; retain the originals to be presented if called for. 322 LETTER OF AUTHORITY TO SIGN BUSINESS PAPER. Belleville, futie I, lig^. Sir:— I have this day authorized, by Power of Attorney, my accountant, Mr. James B. West, to sign my name to Promissory Notes, Checks and Drafts ; also, in like manner, to use my signature in accepting^rders, Drafts and Bills of Exchange ; also, to endorse Promissory Notes, Checks, Drafts, and Bills of Exchant^e. Very truly yours, JOHN A. MILLER. To THE Manager of the Bank of Montreal, Belleville, Ont. Note. — The above authority must be strictly observed in form and extent, otherwise the validity of the act may be endangered. i4 ACKNOWLEDGING RECEIPT OF SHIPMENT. Si. John, N. B., Nov. I, 1894. Messrs. John Jones & Co., Napanee, Ont. Gentlemen : — We have this day received per G. T. R. freight, 500 bbls. Flour, in good order, consigned to us, to be sold for your acc't. and risk, as per your Invoice of the 1 3th ult. As prices are rising, we think it advisable not to push it upon the market at present, but we shall endeavor to seize the most favorable opportunity for effecting sales to advantage. Very respectfully, THOMAS HARVEY & CO. Toronto, Nov. 3, 1894. Messrs. Jones & Brown, Montreal, Que. Gentlemen :— Your reply to our proposition to unite in a company speculation of Mdse., to be sold at Kingston, came to hand on the ist inst., and, in accordance therewith, we have this day shipped 2000 sacks Coffee, as per invoice enclosed, and consigned them to you to be sold for your and our acc't. jointly. One-half of the invoice we have charged to your acc't. in accordance with the terms of our agreement- Amount, $4483.11. A portion of the sugars consigned to us for joint acc't. of yourselves. Smith & Co., and ourselves, has been advantageously sold, and there is prospect of another sale soon. Hoping this new adventure may prove to be for our mutual benefit, We remain, gentlemen, Very respectfully yours, DIAMOND & DAME. t»ER. ne I, 1894. 3. West, to sign any signature in Checks, Drafts, [ILLER. ty of the act may be Vov. I, 1894- •, consigned to'us, ;sent, but we shall EY cS: CO. Nov. 3, 1894- J sold at Kingston, hipped 2000 sacks i our acc't. jointly, of our agreement- Co., and ourselves, ID & DAME. 323 PRACTICAL COMPUTATIONS. It is not our purpose in the small space we have to devote to the subject of Arith- metic, to present anything more than a few rules, on different subjects, that will be found practical by every business man. By the tables as given in most of our school arithmetics, numeration is carried only to six places, or quadrillions, running up by terms derived from the Latin numerals. A series of units of that extent would be beyond the power of man to compre- hend, or even imagine. Even millions convey a very indefinite idea, and when it rises to billions, the mind can no longer grasp the number ; and though we may READ the expression, it is very much as we read sentences in an unknown language. We may perhaps assist the mind of the student by some little calculation. We often see MILLION spoken of in national expenditures ; but the majority of the people do not even imagine the extent of the number. If a man were to count fifteen hundred dollars an hour, and work faithfully eight hours a day, it would take him nearly three months to count a million dollars, and if the dollars were bank bills they would reach over one hundred and ten miles. Dr. Thompson, Professor of Mathematics at Belfast, Ireland, very justly remarks: " Such is the facility with which large numbers are expressed, both by figures and language, that we generally have a very limited and inadequate conception of their real magnitude." The following consideration may perhaps assist in enlarging the ideas of the student on this subject : — "To count a million, at one per second, would require between twenty-three and twenty-four days, of twelve hours each. " The seconds in six thousand years are less than one-fifth of a trillion. A QUADRILLION of Icaves of piper, each the two hundredth part of an inch in thickness, would form a pile the height of which would bs three hundred and twenty times the distance of the moon from the earth. Let it also be remembered that a million is equal to a thousand repeated a thousand times, and a billion equal to a million repeated a thousand times." ADDITION.* Skill in Addition is the foundation of readiness and accuracy in arithmetical computations j and this skill is to be acq ired only by practice and careful attention to the principles and combinations of numbers. A clear head, quick perception, and proper cultivation are the essential qualifications to insure success. With these any one may place himself in the rank of experts, Those who have already learned the rudiments of arithmetic will need, under this head, nothing more than a few practical hints. First, it is important to observe that every operation should be simplified as much as possible. The mind should be disencumbered of the clogs imposed by the school-boy rules, and trained to arrive at I results in the most direct and rapid manner. Even thfe thought of words ought to I be banished. * See page 219 also. 324 To aid in acquiring facility and accuracy in adding short columns of figures the following is considered the best process : — C"! 346 hi' 436 358 633 2863 Commence at the ri^ht hand column, and add thus : i 0-23,33 ; carry the three tens to the next column and add : 11,19,26; carry the two hundreds to the next and add : 10,20,28. In this way you name the sum of two or three figures at once with quite as much ease as you would add one figure at a time. Never permit yourself to add up a column in this manner : 2 and 8 are 10, and 6 are 16, and 7 are 23, and 4 are 27, and 6 are 33. It is just as easy, after a little practice, to name the result of two or three figures at once, and the addition can be performed at least in one-c^uarter of the time. MULTIPLICATION. The process of multiplication may be greatly facilitated in many instances by n little observation and study ; for instance, where there are two numbers to be multi- plied together, each of which consists of two figures, we have the following : — Rule. — Set one of the numbers under the other in the form of multiplication. Multiply the unit figure of the multiplicand by the unit figure of the multiplier. Set down the units of the result and reserve the tens to be added to the next product ; next multiply the tens figure of the multiplicand by the units figure of the multiplier^ and add to the product the figure reserved from the preceding multiplication; then multiply the units figure of the multiplicand by the tens figure of the multiplier ; add these ttvo results together.^ set down the units figure of their sum, reserving the remaining figure or figures to be added to the next product ; now multiply the tens figures of the multi- plicand by the tens figure of the multiplier, and to the product add the number held in reserve, place the result to the left of that part of the product previously found, and t/ic multiplication will be completed. EXPLANATION. Multiply the units of the multiplicand by the units of the multiplier, thus : 56 6 X 3= 18 ; set down the eight as in example. Multiply the tens figure of the 43 multiplicand by the units figure of the multiplier, thus : 5 x 3 = 15, to this add I, the figure held in reserve from the first multiplication, which gives 16 ; next 240(S multiply the units figure of the multiplicand by the tens figure of the multiplier, thus : 6 X 4 = 24, to this add 16 and you have 40, place down the and reserve the 4 ; next multiply the tens figures in each together, thus : 5x4 = 20, and to this product add the 4 held in reserve,_which gives 24 ; set down the whole number, and the pro- duct is complete. USEFUL CONTRACTIONS. To multiply any number of two figures by II. Rule. — Write the sum of the figures between them. 'S3» the n< dozen, instani marke some living of figures the md add thus : umn and add : kext and add : 5 with quite as ■self to add up , and 4 are 27, esult of two or \ one-ciuarter of 325 1. Multiply 36 by 11. ^ns. 396. Here 3 and 6 are 9, which write between 3 and 6. N.B.— When the sum of the two figures is over 9, increase the left-hand figure by the one to carry. Multiply 68 by n. Ans. 748. To square any number of 9's instantaneously, without multiplying. Rule. — lyri/e doivn as many g's less one as there are p'j in the given number, an 8, as many o's as p's, and a i. What is the square of 9999 ? Ans. 99980001. Explanation. — We have four 9's in the given number, so we write down three 9's, then an 8, three o's, and a i. To square any number endmg in 5. Rule.— (9;;/// the 5 and multiply the number as it- will then stand by the next higher number, and annex 2'y to the product. What is the square of 85 ? Ans. 7225. Explanation. — We simply say, 8 times 9 are 72, to which we annex 25. instances by a ers to be multi- awing : — f multiplication, multiplier. Set xt product ; next ', multiplier, and ; then multiply ; add these two remaining figure tres of the multi- i number held in ly found, and the tiplier, thus : 56 jgure of the 43 to this add !S 16 ; next 2408 e multiplier, thus ; id reserve the 4 ; id to this product ber, and the pro- GENERAL RULE. To multiply any two numbers to the nearest unit. 1st. Multiply the whole number in the multiplicand by the fraction in the multiplier to the nearest unit. 2nd. Multiply the 7vhole number in the multiplier by the fraction in the multiplicand to the nearest unit. 3rd. Multiply the whole numbers together, and add the three products in your mind as you proceed. Note. — This rules is so simple .intl so true, according to all business usage, that every accountant should make him- self perfectly familiar with its application. There being no sucli thing as a fraction to add in, there is scarcely any liability to error or mistake. Uy no other arith.aetical process can the result be obtained by so few figures. EXAMPLE FOR MENTAL OPERATION. Multiply 11^ by 8^ by business method. Here ^ of 1 1 to the nearest unit is 3, and ^ of 8 to the nearest unit I IS 3, making 6, so we simply say, 8 times 1 1 are 88 and 6 are 94. Answer, - 94 Reason. — ]^ of 1 1 is nearer 3 than 2, and J^ of 8 is nearer 3 than 2. Make I the nearest whole number the quotient. |A valuable hint to MERCHANTS AND ALL RETAIL DEALERS IN FOREIGN AND DOMESTIC DRY GOODS. Retail merchants, in buying goods by wholesale, buy a great many articles by the Idozen, such as boots and shoes, hats, caps, etc. Now, the merchant in buying, for Instance, a dozen hats, knows exactly what one of those hats will retail for in the Imarket where he deals ; and, unless he is quick at calculation, it will often take him Isoine time to determine whether he can afford to purchase a dozen hats, and make a living profit in selling them by the single hat ; and in buying his ^oods by auctipn^ . 326 ^ as the merchant often does, he has not time to make the calculation before the goods are cried off. He therefore loses the chance of making good bargains by being afraid to bid at random, or, if he bids, and the goods are cried off, he may have made a poor bargain by bidding thus at a venture. It then becomes a useful and practical problem to determine instantly what per cent, he would gain if he retailed the hats at a certain price. % « dH^ RAPID PROCESS OF MARKING GOODS. To tell what an article should retail for to make a profit of 20 per cent, is done by removing the decimal point one place to the left. For instance, if hats cost $19.40 per dozen, remove the decimal point one place to the left, making $1.94, what they should be sold for apiece to gain 20 per cent, on the cost. If they cost $21 per dozen they should be sold for $2.10 each, etc. We take 20 per cent, for the following reasons, viz., because we can determine instantly, by simply removing the decimal point, without changing a figure ; and, if the goods would not bring at least 20 per cent, profit in the home market, the merchant could not afford to purchase, and would look for goods at lower figures. Now as removing the decimal point one place to the left, on the cost of a dozen articles, gives the selling price of a single one, with 20 per cent, added to the cost, and as the cost of any article is 100 per cent., it is obvious that the selling price would be 20 per cent, more, or 120 per cent; hence, to find 50 per cent, profit, which would make the selling price 150 per cent., we would first find 20 per cent., then add 30 per cent., by increasing it one-fourth itself; to make 40 per cent, add 20 per cent, by increasingit one-sixth itself; for 35 per cent, increase it one-eighth itself, etc. Hence to mark an article at any per cent, profit, we have the following : — GENERAL RULE. First find 20 per cent profit by removing the decimal point one place to the left on the price the articles cost a dozen ; then, as 20 per cent, profit is 120 per cent,, add to or subtract from this amount the fractional part that the required per cent, added to 100 is more or less than 120. TABLE FOR MARKING ARTICLES BOUGHT BY THE DOZEN. N. B. — Most of these are used in business. ' To make 20 per cent, remove the point one place to the left. 80 60 50 44 40 35 and add one-half itself. " " one-third " " " one-fourth '* " •• one-fifth " " " one-sixth " " " one-eighth " SIMPLE INTEREST. To find the Simple Interest on any sum of money for one year, multiply the sum by the rate per cent., and divide the product by loo. To find tb^ interest for an exact number of years, or years and months, first find ore the goods )y being afraid have made a and practical ailed the hats r cent, is done ooint one place !o per cent, on etc. We take le instantly, by 1, if the goods merchant could cost of a dozen ded to the cost, he selling price per cent, profit, nd 20 per cent., o per cent, add ,se it one-eisjhth the following :— one place to the Profit is 120 per the required per iE DOZEN. idf. , multiply the sum months, first find ' 327 it for one year as above, and multiply the result by the number of years, or number of years and fraction of a year. Examples. — Find the interest on $850 for i year at 7 per cent., also the interest on $850 for 5 years at 7 per cent., and for five years and 7 months at 7 per cent. Solution No. i $850 7 Solution No, 2. $850 7 «59.S0 5 Solution No. 3. »Sso 7 $59.50 «S9.5o S 7-I2 §297.50 Ans. I297 50 34 71 ?332.2i Ans. To find the Simple Interest on any sum of money for a number of days, arrange the example in the form of a fraction, by placing the principal over the number i, the rate per cent, over 100, and the numbers of days over 365 ; then multiply the three fractions together thus : — Example. — Find the interest on $940 for 56 days at 8 per cent. Solution.— a'*o x xSo * bW = $ii-S4. Ans. Note.— Before multiplying the fraction, it may be cancelled by striking common factors out of numerators and denominators. SIMPLE INTEREST BY CANCELLATION. Rule. — Arrange the example in the form of a fraction by placing the principal over the figure i. Multiply the fraction thus formed by the rate per cent, over 100, then again by the number of months over 12, if the time is even months ; or if the time consists of days, or months and days, find the exact number of days, which place over 365. Cancel all factors common to a numerator and denominator of the fraction thus formed, simplify the fraction, and the result will be the required interest. EXAMPLES. I. — Find the interest on $850 for 6 months at 7 per cent Arrangement 1 7 HB HfiO 1 '^ too '^ 1' 10 = $29.75 Ans. 2. — Find the interest on $940 for 48 days at 6 per cent. Arrangement I) 4 T :> II TOO 1 5 XTnnX3Vy = $7-42 Ans. 3. — Find the simple interest on : — $860 for I year at 7 per cent. Ans. $60.20. 4.— 91468.50 for 6 years at 8 per cent. Ans. $704.88. 5. — $1272 for 4 years and 5 mos. at 6 per cent. Ans. $337.08. 6.— $840.75 for 3 years and 11 mos. at 5 per cent. Ans. $164.66. 7. — $680 for 10 mos. at 7 per cent. Ans. $39.67. 8.-^920 for 9 mos. and 23 days at 6 per cent. Ans. $44.88. 9.— 31034 for 68 days at 7 per cent. Ans. $13.48. 10. — $364.40 tor 170 days at 8 per cent. Ans. $9.85. II.— $480 from Jany. 12th to Sept. i6th at 6 per cent. Ans. $19.49. 12.— $760 from Aug, 9th to Dec. 31st at 7 per cent. Ans. $20.99. c^ :' n the expiration of 18 months as it will take $1800 to gain the interest then due, iiamely, $42 + $21 =$63. The interest of $1800, for one month, at 6 per cent., is $9 ; and 63-r9= 7. Therefore, it will take $1800 7 months to gain $63 interest, and the equated time is 7 months prior to July 1, 1894, or 11 (18—7) months from Jan. i, 1894, which is Dec. i, 1894. Product Method. 700 X 6= 4200 300 X 4= 1200 800 X 18=14400 PRACTICAL solution. Interest Method. 6 % Int. of $700 for 6 mos. ={21.00 «• " 300 " 4 •' = 6.00 " " 800 " 18 •• = 72.00 1800 ) 19800(1 1 1800 1800 1800 1800 99-r9=ll mos. J. 00 = 900 ch IS, 1894. y Wni. Smith, or S JONES. '. BROWN. r I, 1S94, $100 ; 102.87. t, in one amount, » either debtor or Iquated Time. the principle, that equivalent to the »F TIME AFTER IT ; a point of time the sums not due, discount. and $100 due in eighteen months 00 for six months c months before it 3 is payable in six 1 can the whole be itil the maturity of ■00 for 12 months, iths, which is $21. Clearly, it should $1800 to gain the )o, for one month, 5 7 months to gain S94, or II (18 — 7) S mos. 4 •• 8 " =$21. op = 6.00 = 72.00 I •' $99.00 = 900 331 EXPLANATIONS. The UHP. of $700 Tor 6 months = the uie of $i for 4300 months. " " $300 for 4 months = the use of $1 for 1200 months. " " $800 for 18 months- the use of i^i for 14400 months. " " $1800 for II months = the use of |i for 19800 months. The use of $1 for 19800 months is equal to the use of $1800 for as many months as 1800 is contained times in 19800= 11. By the Interest Method, the total interest of the different sums for their respective terms of credit is $99, and the interest of $1800 for one month is $9. Therefore it will take $1800 as many months to gain $99 as 9 is contained times in 99 » II. Hence, the equated time is 11 months from Jan, i, 1894, or Dec, i 1894. example. I. — Sold Robert Jones the following goods : — June I, 1894, $350 on 2 months credit. July 15, " $400 •* 3 " ♦• Aug. 10, " $450 " 4 •' '« Sept. 12, " $600 '• 6 " " What is the equated time of payment ? SOLUTION. • June I, 1894, $350 on 2 mos. falls due Aug. July IS. (1 U400 " 3 Aug. 10, it $450 " 4 Sept. 12, 1894. $350 X - 00000 Oct. 15. II $400 X 75 = 30000 Dec. 10, II $450 X 131 = 58950 Mar. «2, 189s. $600 X 223 = 133800 1800 Ans. 124 days from Aug. 1, Dec. 3. Rule. — Find the dates when tke several items become due. 222750(124 mos. II. — Take the earliest one of the dates thus found as the standard or focal date from which to compute the time to each of the other dates. III. — Multiply each item by the number of days betiveen its date and the focal date, add together the several products and divide their sum by the amount of the account ^ the quotient thus found is the number of days to count forward from the focal date. EXAMPLES FOR PRACTICE. 2. — Sold goods to A. as follows : — 1894, June 10, a bill at 60 days % 2500 00 475 32 500 00 21975 15025 Aug. 18, " " 30 Sept. 20, " " 90 Oct. I, " " 60 Nov. I, " •' 30 When will the above bill become due by average ? % 3845 32 Ans. Sept. nth. 332 3.— Bought of G. C. Holton & Co., mdse. as follows ; — 1894. Jan. I, miUc, nt 30 dayx Feb. 13. " "60 " Mnr. 15, " '• 90 •' Apr. II, " '• 30 " When will this account average due ? Ans. May 13. 9 193 ^o •37 50 74a as 350 00 « 1422 05 4.- Sold Smith & Co. :— , 1894. July 25, mdse. at 3 mo» $ 135° 0° Aug. 20, " " 2 " 463 75 Sept. 30, *• " 3 " '89 25 Oct. 26, " '• 2 " 300 00 9 2303 00 The purchasers propose to settle the account October 30, 1894, by giving a pro missory note for the entire amount ; what time should be expressed in the note to make it fall due at the average maturity of the account ? Ans. 7 days. 5. — A merchant sold to one of his customers several bills of goods, as follows : — May 9, 1894, a bill of $940 on 4 months' credit, Juie 6, " •• 500 on 3 " July 8, '• '• 945 on 5 Aug. 30, " " 830 on 5 " " Sept. 30, •* " 1000 on 6 " " What is the equated time of payment, and how m'uch would balance the account, Jan. I, 1894, allowing interest at 6 per cent. ? DOUBLE EQUATION OR AVERAGING OF ACCOUNTS. There are a number of different rules for working double equation. We select the following, on account of its simplicity : — Rule I. — Find the date when each item is due or paid on both sides. II. — Take the earliest due date on either side thus found, or the first day of the month in which the earliest due date comes, for the focal or standard date, and multiply each item on both sides of the account by the number of days between the focal date and the date of the item. III. — Add the products on each side and subtract the sum of those on one side from the sum of those* on the other, and divide the difference by the balance of the account. The quotient is the number of days to count forward from the focal date, when the balance of the products and the balance of the account come on the same side, and backward from the focal date when they come on opposite sides. 10 50 »5 35 oo 75 25 00 00 )y giving a pro in the note to s follows ;— nee the account, JNTS. ' ion. We select sides. first day of the idard date, and ays between the 3f those on one f the balance of » from the focal nt come on the )posite sides. • :n3 Example no. i. Find the equated time for the payment of the balance of the following account :— t)R. VV. B. Robinson. Cr. 1894. Ian. It. Feb. 1. Mar. «S. May 3. Due dates fan. II. May 1. Sept. >5. ti 3. To Mdse. for cash f 750 " " on 3 mos 600 6 " 1500 " " "4 " 900 1894. Mar. 3, DyCash. Apr. 14, " " . >5. .$700 • 5C0 . 300 SOLUTION. days 750 X 10= 7500 600 X 120= 72000 I SCO X 257 = 385500 900 X 245-220500 I'nid or due. Mar. 3. Apr. 14, *' ic days. 700 X 61—42700 500 X 103 = 51500 300 X 104 = 31200 3750 1500 Ual. of account 2250 685500 125400 1500 125400 560100 Bal. of products. 4500 lioio 248I';: or 249 (lays. 9000 20100 18000 2100 42 2250 45 Balance $2250 averages due 249 days from Jany. i, 1894, or Sept. 7. Note.— In the above example Jany. i is taken .is tlic foc.-il date instead of Jany. ii. The same residt would have lieen obtained by takmg Jany. ii. Example 2.— Find the ecjuated time for the payment of the balance of the following account : — Montreal, Nov. 5, 1894. Mr. John Smith, In account with S. S. Edsall. Dr. Cr, 1894 • 1894 ■ ■- Aug. 18 To Mdse , 90 days, .$2500 00 Sept. 20 By Cash, $1000 00 Sept. 20 " " 60 " 500 00 Oct. 10 ti «. 500 00 Oct. I •' " 30 " 475 00 Nov. 5 11 (t 275 00 Nov. 5 «« •< JO " 335 00 00 Balance, 2035 #3810 00 $3810 00 Dr. 3. When is the balance of the following accounts due per average ? A. B. PERRY. 1894 1894 Sept. 12 To Mdse., at 30 days, «927 30 Oct. 10 By Cash, fSoo 00 Oct. >5 II .}Q It 342 7S Nov. 20 11 II 300 00 Nov. 18 y DiiOilciiiiHxIs, ft. ill. 57 '-3 28 " 6 28 1603 7 ' o 100)1631 " 7 •' 6 16.31 s(|uarcs, The mode of measuring roofing is given in the next exercise. TILING OR SLATING. Tiling and slating are measured by the square of ico feet, as flooring, partition- ing and roofing are in carpenters' work ; so th;it there is not much difference between the roofing and tiling ; yet the tiling will be the most, for double measure is some- times allowed for hips and valleys. In this work the contents of the roof are found by multiplying the length of the ridge by the girt from eave to eave. When gutters are allowed double measure, llie way is to measure the length along the ridge-tile, and add it to the contents of the roof; this makes an allowance of one foot in breadth, the whole length of the hips or valleys. It is usual also to allow double measure at the eaves, so much as the projection is over the plate, which is commonly about 18 or 20 inches. Skylights and chimney shafts are generally deducted, if they be large, otherwise they are not. Example i. — There is a roof covered vvith tiles, whose depth on both sides (with the usual allowance at the eaves) is 37 feet 3 inches, and the length 45 feet; how many squares of tiling are contained therein ? By Decimals. 37-25 45 1S625 14900 1676.25 1676 3 Example 2. — The length of a slated roof is 45 feet 9 inches, and its girt 34 feet 3 inches ; what are its contents ? Ans. 1566.9375 sq. ft. 3. What will the tiling of a barn cost at $3.40 per square of 100 feet, the length being 43 feet 10 inches, and breadth 27 feet 5 inches on the flat, the eave board projecting 16 inches on each side, and the roof being of the true pitch. Ans. $65.26, By Duodedinah ft. in. 37 3 4S i8s 148 u 3 344 c: PLASTERERS' WORK. Pla; terers' work is of two kinds, viz. : ceiling, which is plastering on laths ; and rendering, which is plastering on walls. These are measured separately. The contents arc estimated either by the square foot, the square yard, or the square «f loo feet. Enriched mouldings, etc., are rated by the running or linear measure. In estim.nting plastering, deductions are made for chimneys, doors, windows, etc. Example i. — How many square yards are contained in a ceiling 43 feet 3 inches long, and 25 feet 6 inches broad? Ans. 122 Vi' nearly. 2. — What is the cost of ceiling a room 21 feet 8 inches by 14 feet 10 inches, at 18 cents per square yard ? Ans. $6.42 +. 3. The length of a room is 14 feet 5 inches, breadth 13 feet 2 inches, and height to the under side of the cornice 9 feet 3 inches. The cornice girts 8^4 inches, and projects 5 inches from the wall on the upper part next the ceiling, deducting only for one door 7 feet by 4 ; what will be the amount of the plastering:* ( ^3 yls. S ft. 3' 6" of rendering. Ans.-J 18 yds. 5 ft. 6' 4" of ceiling. 1.37 ft. 10' 9" of cornice. The mean length of the cornice, both in length and breadth of the house, is found by taking the middle line of the cornice. Now, since the cornice projects 5 inches at the ceiling, it will project 2 ^^ inches at the middle line ; and, therefore, the length of the middle line along the length of the room will be 14 feet, and across the room 12 feet 9 inches. Then multiply the double of each of these numbers by the girth, which is S}4 inches, and the sum of the products will be the area of the cornice, PAINTERS' WORK. Painters' work is computed in square yards. Every part is measured where the color lies, and the measuring line is carried into all the mouldings and cornices. Windows are generally done at so much apiece. It is usual to allow double measure for carved mouldings, etc. Example i. — How many yards of painting in a room which is 65 feet 6 inches in perimeter and 12 feet 4 inches in height? Ans. SgtJ sq. yds. 2. The length of a room is 20 feet, its breadth 14 feet 6 inches, and height 10 feet 4 inches ; how many yards of painting are in it— deducting a fire-place of 4 feet by 4 feet 4 inches, and two windows, each 6 feet by 3 feet 2 inches ? Ans. 73o> sq. yds. MASONS' WORK. The measure made use of in all sorts of stone work is either superficial or solid. Walls, columns, blocks of stone or marble are measured by the cubic foot, and pavements, slabs, chimney pieces, etc., are measured by the square or superficial foot. Cubic or solid measure is always used for the material, and square measure is some- times used for the workmanship. Example i. — Required the solid contents of a wall 53 feet 6 inches long, 12 feet 3 inches high and 2 feet thick. Ans. 1310^ ft. 2. What are the solid contents of a wall, the length of which is 24 feet 3 inches, height 10 feet 9 inches, and thickness 2 feet. Ans. 521.375 ft. ; on laths ; and re yard, or the sure. rs, windows, etc. 43 feet 3 inches 2 1/3 nearly. ;et 10 inches, at ;s. $6.42+. ches, and height 8^ inches, and ducting only for of the house, is )rnice projects 5 id, therefore, the t, and across the numbers by the ea of the cornice. :asured where the nd cornices. . to allow double s 65 feet 6 inches 89*1 sq. yds. es, and height 10 ire-place of 4 feet ? s. nA sq. yds. uperficial or solid. e cubic foot, and or superficial foot. measure is some- nches long, 1 2 feet js. 1310^ ft. s 24 feet 3 inches, s. 521.375 ft. 345 3. In a chimney-piece we find the following dimensions : — I.enKth of the tnnntcl and sl.-il), 4 fict 2 inches Ureadlh of both together, 3 "2 " Length of e.ich jam, 4 "4 " Hreadth of both, 1 " 9 " Required, the superficial contents. Ans. 31 ft. 10 in. Stone walls are measured by the solid foot, the superfici.il foot, and by the perch.* Artificers' work in general is computed by three different measures, viz : 1. The linear measure, or, as it h called by mechanics, running measure. 2. Superficial or square measure, in which the computation is made by the square foot, square yard, or by the square containing 100 square feet or yards. 3. By the cubic or solid measure, when it is estimated by the cubic foot or cubic yard. The work, however, is often estimated in square measure, and the materials fur construction in cubic measure. Masons generally contract for foundations of buildings and other walls of that description at so much per perch (lOyi feet), and in estimating their work adopt the following : Rule. — Multiply the lengthy height and width of the wall together, and divide the product by 16^. Example. — How much will it cost to build a stone wall 60 ft. long, 8 feet high and 3 feet thick, at 70 cents per perch ? OPERATION. 60 X 8 X 3 ---' 87 3-1 1 perches x 70c — .S61.09. Ans. l6i BRICKLAYERS' WORK. The dimensions of a brick generally bear the following proportions to each other, viz. : Length = twice the width, and Width = twice the thickness ; and hence the length is equal to four times the thickness. The common length of a brick is 8 inches, in which case the width is 4 inches and thickness 2 inches. A brick of this size contains 8 x 4 x 2 = 64 cubic inches : and since a cubic foot contains 1728 cubic inches, we have i728-r64=27, the number of bricks in a cubic foot. If the brick is 9 inches long, then the width is 4^^ inches, and the thickness 2ji(, and each brick will contain 9 x 4f-^ x 2']^ =91^ cubic inches ; and 1728 ^91^-6 = 19 nearly, the number of bricks in a cubic foot In the examples which follow we shall suppose the brick to be 8 inches long, unless otherwise mentioned. To find the number of bricks required to build a wall of given dimensions : — 1, Find the contents of a ivall in cubic feet. 2. Multiply the number of cubic feet by the nnmber of bricks in a cubic foot, and the result will be the number required. * Since different ways of measuring stone >valls are adopted by different mechanics, it is necessary, wlien called upon to measure such work, to first ascertain which system is intended to be adopted. 1 > 4 c: r 840 ExAMi'LK. — How many bricks of 8 inches in length will be required to build a wall 30 feet long, a brick and a half thick, and 15 feet in height ? Ans. 12150. 2. How many bricks of the usual size will be reciuired to build a wall 50 feet long, 2 bricks thick, and 36 feet in height ? Ans. 64800. The thickness of mortar between the courses is nearly a quarter of an inch, so that four courses will give nearly one inch in height. The mortar, therefore, adds nearly one-eighth to the height. One-eighth is rather too large an allowance ; but the mortar that goes to increase the length of the wall and to fill other spaces makes it about one-sixth. Mechanics in making estimates consider 5-6 of a wall solid brick. 3 How many bricks would be re(iuired in the first and second e.\amples, if we make the proper allowance for mortar ? Bricklayers generally estimate their work at so much per thousand. 4. What is the cost of a wall 60 feet long, 20 feet high and 2'/^ bricks thick at $7.50 per thousand — which price we suppose includes the cost of the mortar ? If we suppose the mortar to occupy a space e(|ual to one-sixth the height of the wall, we must find the quantity of bricks under supposition that the wall is to be I'i^i feet in height. In estimating bricks for a house, allowance must be made for the windows and doors. To ascertain the number of bricks required to build i foot of a wall of any given thickness. Rule. — Multiply the thickness oj the ivall in inches by 144, and from the product deduct ^^ itself^ and divide the remainder by the solid contents of a brick. Example. — How many bricks will it require to build i foot of a wall i brick or 8 inches thick ? SOLUTION. 8x 144 =--- 1152- 192 -= 960. 8 X 4 X 2 = 64 solid contents of i brick. 960464 == 15. Ans. Note. — The mode of working examples where the proper .illo«.-\nces for mortar, nr , are taken into consideration will l>e given in the following exercises. Example. — How many bricks will it require to build i foot of a wall 12 inches thick ? SOLUTION. 12 X 144—1728-288— 1440. 8 X 4 X 2 = 64 solid contents of one brick. 1440 -f 64 = 22J. Ans. To ascertain the number of bricks required to build a wall. RdLE. — Multiply the length and height of the 7uall in feet together ; this product multiplied by the number of bricks required to build 1 foot of such tvall luill be the required result : Example i. — Find the number of bricks required for the erection of a building the walls of which are 9 inches thick, the length 40 feet, width 32, and the height 18. Allowance to be made for 12 windows, 7 feet by 3;^, and 3 doors, 8>4 by 4 feet. (Bricks 9 inches long.) ed to build a 1 2 150. a wall 50 feet of an inch, so herefore, adds ivance ; hut the paces makes it all solid brick. ixamplcs, if we Dricks thick at mortar ? e height of the e wall is to be e windows and a wall of any III deduct % itself, a wall I l)rick en into consideration wall 12 inches t multiplied by the )n of a building and the height oors, 8>^ by 4 317 SOLUnON. 404-40 + 304 + joj*- 141, the lcnj;th in a slrni^lit wall. 141 x 18. llie licit;iil = 2S3S. ihenumlicr af «|uare feet. 7 x 3J x 12 - 294 feci, tlie s|).icc occupied i>y the wimlows j 8J x 4 x 3 = loj fret, the space occupied liy the doors— hence 294 + 102-390, the number to be de4 feet. Example 3. — Find the number of bricks rc(|uired to buiUl a house of the lollowing dimensions ; the main building to bo 30 feet long, 24 wide, 15 high, and walls 8 inches thick ; 2 doors, one Hj^j by 6 ft , the other 7 by ^^i ft. ; 8 windows 63^ by 4 ft. The kitchen to be 13 ft. long, 1 1 feet wide, and side walls 10 ft. high having a gable t 4,'^ ft. in altitude, 4 windows 4^^ by 3 ft., and 2 doors 7)^ by y^. 2. How many bricks will be rcciuired to erect a wall 140 feet long, 14 ft. high» 1 ft. thick ; allowing for 2 doors 4x7 feet, and 12 windows 3 :^ 5 ft. 3. IIow many bricks will be reiiuired t-. erci t a house 2' x 36 ft , walls 21 feet high and i ft. thick; allowing for 3 djors, one ;K' x 7 ft) two 3x6 ft., and J2 windows, two 5x7 ft., three 4x6 ft., and seven 3x5 ft. 4. How many perches of stone-work are there in the foundation of the above building if the walls be 2 ft. thick and 4 ft. hif?h, there bcinj; a ..;ilar in one corner, 18 X 20 ft , the walls of which are 7 feet high ? NoiK. — It is im|iossil)li, on .iccouiit of tlic necessary waste .nnti oilier inotlifyin;; ijirciimsl.nnre>. "o ^ive llie ex.ict number of l)ricks rc(|uired to build a wall, but the above system ofcilciilat! ., I\ boeu found by pr, ' ■■:■ .li nii:elianii:s to be nearly riglit. GLAZIERS' WORK. Glaziers take their dimensions in feet, inches and eighths or tenths, or else in feet and hundredth parts of a foot, and estimate their work by the square foot. Windows are sometimes measured by taking the dimensions of one pane and multiplying its superficies by the number of panes. But more generally they measure the length and breadth of the window over all the panes and their frames for the length and breadth of the glazing. Circular or oval windows, as fan lifjits, etc., are measured as if they were scjuare, taking for the dimensions their greate*'* it ;igth and breadth, as a compensation for the waste of glass and labor in cutting it 10 the necessary forms. Example. — If a pane of glass be 4 feet 83^ inches long, and i foot 4^ inches broad, how many feet of glass in ihat pane? By Decimals. 4.729 1-354 By Duodecimals. FT. IN. P. 4 « 9 I 4 3 4 8 9 I 6 II I 2 2 3 6 4 10 3 18916 23645 14187 4729 6.403066 Ans. 6 feet, 4 inches. * It will be observed that ij feet are deducted from eacli end to allow for the thickness of the wall, t To find the contents of a gable, multiply the width of the building by the height of the gable, and divide the product by two. .",•18 c: I i TO FIND DIVISORS FOR CIRCULAR FIGURES. It has been found by experiment that the area of a circle, whose diameter is unity, will be .785398, + ; but which, for the sake of convenience, is usually con- sidered as .7854 parts of a unit ; wherefore, by dividing the solid capacity of any figure By .7854, the quotient will be the proper divisors to the square diameters of circular figures. To reduce the area, at one inch deep, into gallons, or if the contents of any vessel be first found in inches, by multiplying the area into the depth, &c., and then applying such divisors, the contents will be found in terms of the factor employed : hence Example. •7854 I 144 1728 282 231 ( 1-273 ( 183.34 ( 2200.16 { 395-05 ( 294.12 which are the divisors for circular figures, of which the dividends are the solid capacities in inches ; and to each of which .7854 (as on the left thereof) is a divisor from whence such quotients result. 2150.42 ( 2738 268.8 (■ 342.25 277 ( 289 217.6 ( 277 326.4 ( 415.8 N. B. — Any divisor for a circular figure bein^ multiplied by 1.5 gives the divisor for spheres. To find multipliers answering the purpose of the foregoing divisors for circular figures. Rule. — Divide .7854 by the solid capacity of any figure, in inches, and the quotient is the corresponding multiplier to such divisors respectively. To find the solid contents of a cylindrical vessel. Rule. — Multiply area of bottom by height of vessel. Example. — The inside diameter of a cylindrical vessel being 40 inches, and height of side 5 feet, find its cubical contents. Area of bottom = 403 x .7854 = 1256.64. 1256.64 area of bottom. 60 in height. Ans. 75398.40 cubic inches. To find the cubical contents of a vessel with rectangular base and vertical sides. Rule. — Multiply lenght of bottom by breadth, and the product by height of vessel. Example. — How many cubic feet will a tank, measuring 8 feet long, 4 feet wide, and 4j^ feet deep contain ? Ans. 8x4x4^ or 144 cu. ft. It frequently occurs that cisterns are to be so constructed as to hold given quan- tities of water, and it then becomes a useful and practical problem to calculate liieir exact dimensions. If the height of a cistern be given, to find the diameter, so that the cistern shall contain a given number of hogsheads : — I St. Reduce the height of the cistern to inches, and the contents to cubic inches. 2nd. — Multiply the height by .7854. 3rd. — Divide the contents by the last result, and extract the square root of the quotient, which will be the diameter of the cistern in inches. To find the solid contents of a vessel with circular top and bottom of unequal dimensions, and having straight sides ; or to find the cubical contents of the frustrum of a cone. Note. — The area of a circle is found by multiplying the square of the diameter by .7854. ose diameter is is usually con- capacity of any re diameters of lUons, or if the I into the depth, ms of the factor ihich the dividends of which .7854 (as ice such quotients sor for spheres, sors for circular aud the quotient ; 40 inches, and 349 Rule. — To the product of top and bottom, diameters add the sum of their squares, multiply this sum by the perpendicular height and by constant ,2618, Example. — The top diameter of a circular vessel is 20 inches, the bottom dia- meter II inches, and the perpendicular height iS inches ; find its solid contents. To product of diameters, add sum of their squares, 20X II =220 400+121=521 741 nd vertical sides. ' height of vessel. long, 4 feet wide, •r 144 cu. ft. hold given quan- to calculate iheir the cistern shall s to cubic inches. [uare root of the Dttom of unequal ts of the frustrum 741 X 18 =■ 13330 X .2618 = 3491. 8SS;4 cubic inches. To find the capacity in gallons of a tank, cistern or vessel of any kind. Rule. — Divide the contents in cubic feet by 6.2 J2i and the result mill be Imperial gallons ; or multiply the contents in cubic inches by .ooj6 for a like result. GAUGINC; CASK.S. Rule. — Take the distance in inches from the centre of the bung inside, diagonally, to the chine ; cube it, and divide by j/O, and the quotient 7vi/l express the gallons. Should then be a remainder, multiply by 4, and continue the division for quarts ; by 2, for pints, etc. This standard number, 37c, is derived from actual experiment. The measure- ment of a regular-shaped cask cubed as above, divided by the actual capacity of the English gallon pot, gave the standard 370. EXAMPLES. 1. How many gallons will a hogshead hold measuring 37 inches from the centre of the bung inside to the chine ? Ans. 136 gals., 3 qts., i pt. OPERATION. 37 X 37 X 37 = 506534-370 = 136 gallons. 1st remainder 333 x 4 = 1332 -f 370 = 3 quarts. 2nd remainder 222 x 2 = 444 -r 370 = i pint. 2. A cask measures 16 inches from the centre of the bung, diagonally, to the chine ; what is its capacity ? Ans. 1 1 gals., 2 gills. 3. A cask measures 18 inches, diagonally, to the chine inside, one way, and 19 inches the other ; what will it hold ? Ans. 17 gals., and 3 gills. 4. I have a small cask measuring 13 inches to the chine inside ; what does it hold ? Ans. 5 gals., 3 qts., i pt., 2 gills. TO MEASURE CORN IN THE CRIB. Corn is generally put up in cribs made of rails, but the following rule will apply to a crib of any size or kind. Two cubic feet of good, sound, dry corn in the ear will make a bushel of shelled corn. To get, then, the quantity of shelled corn in a crib of corn in the ear, measure the length, breadth and height of the crib, inside of the rail ; multiply the length by the breadth, and the product by the height, then divide the result by two, and you have the number of bushels of shelled corn in the crib. In measuring the height, of course the height of the corn is intended. And there will be found to be a difference in measuring corn in this mode, between fall and spring, because it shrinks very much in the winter and spring, and settles down. Note. — If the bung is not in the centre, measure both ways to chine ; add the two results together, and take half the sum ; then proceed as above. .'550 MEASUREMENT OF (JRAIN. The standard unit of Dry Measure is the Imperial bushel, which is an upright cylinder, whose internal diameter is 18.789 inches, and depth 8 inches. It contains 2218.192 cubic inches or 80 lbs. Avoifdupois of pure distilled water. Grain is bought and sold by weight, allowing for a bushel as follows : Wheat 60 lbs. ; Indian corn, 56 • rye, 56 ; peas, 60 ; barley, 48 ; oats, 34 ; beans, 60 , clover seed, 60 ; timothy seed, 48 ; buckwheat, 48 ; flax seed, 50 ; hemp seed, 44 ; blue grass seed, 14; castor beans, 40: potatoes, turnips, carrots, parsnips, beets and onions, 60 lbs. ; salt, 56 ; dried appies, 22 ; dried peaches, 33 ; and malt, 36 pounds. C 1 K 4 TO MEASURE GRAIN ON THE FLOOR. Rule. — Make the pile in the form of a pyramid or cone, and multiply the area of the l/ase by one-third the height for the cubical contents. Example. — A conical pile of grain is 8 feet in diameter, and 4 feet high, how many bushels does it contain? SOLUTION. The square of 8 is 64 ; and 64 x .7854 x 1 ^ x J ! fa-xy o the number of bushels = 52.201. TO ASCERTAIN THE WEIGHT OF CATTLE BY MEASUREMENT. Multiply the girth in feet by the distance from the bone of the tail immediately over the hinder part of the buttock, to the fore part of the shoulder-blade ; and this product by 31 when the animal measures tnore than 7 and less than ^ feet in girth ; by 23 when less than 7 and more than 5 ; by 16, when less than 5 and more than 3 ; and by 1 1 when less than 3. Example. — What is the weight of an ox whose measurements are as follows: girth, 7 feet 5 inches ; length, 5 feet 6 inches? SOLUTION. 5I ^ 7i"a = 40u 4 j 4°^! >< 3 1 = 1 264 + . Ans. A deduction of one pound in 20 must be made for half-fatted cattle, and also for cows that have had calves. It is understood, of course, that such standard will at best give only the approximate weight. MEASURING LAND. To find the number of acres of land in a rectangular field, multiply the length by the breadth, and divide the product by 160, if the measurement is made in rods, or by 43560 if made in feat. Example. — How many acres in a field which is 100 rods in length by 75 rods in width. «-: SOLUTION. 100 X 75 = 7i^oo-m6o = 46J. Ans. To find the contents of a triangular piece of land, having a right-angled corner, multiply the two shorter sides together, and take one-half the product. 20 li is an upright s. It contains ollows : Wheat 4 ; beans, 60 , lemp seed, 44 ; lips, beets and lalt, 36 pounds. \ultiply the area \ feet high, how )er of bushels = UREMENT. tail immediately blade ; and this 9 feet in girth ; nd more than 3 ; s are as follows : ttle, and also for standard will at 3ly the length by made in rods, or ength by 75 rods ;ht-angled corner, ;t. n.jl DISCOUNTING BILLS AND INVOICES. Pkici: liiSTS are made out by manufacturers and dealers, as prices to be charged subject to the deductions of certain rates per cent., which fluctuate according to the cost of manufacturing, demand for goods, etc. By changing the rate of discount the prices are changed without altering the price lists. In disccuntiiig Bills and Invoices, losses sometimes occur when they are not suspected. If an article is sold at a profit of 40 per cent., and 10 per cent, be deducted from the selling price, the gain is not 30 per cent, but 26 per cent., because the discount is calculated on the first cost and also on the profit, whereas the profit is calculated on the first cost only. So, also, if 40 per cent, be added, and then 30 per cent, deducted, the apparent profit is 10 per cent., but the re.\l loss is 2 per cent. Cost, S200 40 per cent., 80 Advanced price, Less 10 per cent. 2S0 28 Cash Price, 252 26 per cent, profit. lo per cent, of $200 (cost) = 20 10 per cent, of ^80 (profit) = 8 14 per cent, of cost. ^28 Cost 40 per cent., $1.00 40 Advanced price, 1.40 Less 30 per cent., .. 42 Cash price. 2 per cent. loss. 3opercent, of$i.oo(cost) = 30 per cent, of .40 (profit)— . . or 42 per cent, of co'-.t. 98 30 12 .1.42 3. What is the difference between discounting a bill of $1200 at 40 per cent., and then takmg a discount off the remainder of 5 per cent, for cash payment, and discounting the whole bill at 45 per cent. ? Ans. $24. 4. If a merchant buys a book at a discount of 20 per cent, on the retail price, and sells it at the retail price, what per cent, on the purchase price does he gain ? What per cent does he gain if he buys at 33^ per cent, discount, and sells it at the retail price ? Ans. to first 25 per cent, ; to second, 50 per cent. To find the selling price from which a certain per cent, may be deducted and the goods sold at cost, or a given per cent, above o. helovv cost. Rule. — To sell at cost Multiply the cost hy too, and divide the product by 100, diminished by the rate per cent, to be deducted. To sell at a given rate per cent., above or below cost. Multiply 100 increased by the per cent, to be gained or diminished by the per cent, to be lost by the cost ; and divide the product by 100, diminished by the rate to be deducted from the selling price. KXAMPLES. 1. Bought goods for $100; for how much must I sell them that I may deduct 20 per cent, and yet obtain what they cost ? 100 X 100= lOOOO. 10000 -r 80=125. Ans. 125. 2. For what must I sell goods worth $100 so that I may deduct 45 per cent, and yet gain 30 per cent. ? 100+30=130. 100x130=13000. i3ooo-r55 = 236.36. Ans. $236.36, Note. — 336.36 = 136.36 per cent, adv.ince on loo. When .1 long list is to he in.idc out at a unirurm rate of prolit, labor may be saved by adding the total advance at once. 352 •Hi 1 'i 4 c: 3. If I buy cloth for $1.90 per yard, at what price must I mark it that I may deduct 5 per cent, for my cash customers from the marked price, and yet gain 20 per cent. ? Ans. $2.40. 4. A merchant marked a piece of goods 25 per cent more than it cost him, but being anxious to effect a sale, and supposing he should siill gain 5 per cent., sold it at a discount of 20 per cent, from his marked price. Did he j;ain or lose ? Ans. Neither. 5. My retail price for cloth is $3.75 per yard, by which I make a profit of 33 ^^ per cent. I sell to a wholesale customer at 20 per cent, discount from the retail price. How much per cent, do I gain or lose and what do I receive per yard ? Ans. $3. gain 6^4 per cent. 6. My retail price for broadcloth is $4 75 per yard, by which I make a profit of 33/^ per cent. I sell a wholesale customer 100 yards at a discount of 30 per cent, from the retail price. What per cent, do I gain or lose, and what do I receive per yard? Ans. Lose 6^ per cent. Reed. $3,325 per yard. 7. I bought a quantity of tea at $1 per lb. Allowing that the tea will fall short 10 per cent, in weighing it out, and that 15 per cent, of the sales will be in bad bebts, for how much per lb. must I sell it to make a clear gain of 20 per cent, on cost ? Ans. $1,568. 8. Sold lumber on commission at 5 per cent. Invested net proceeds in dry goods at 2 per cent, commission. My whole commission was $70. What was the value of the lumber and dry goods ? Ans. Lumber, $1020; Dry Goods, $950. Suggestion. — Net proceeds of lumber equal jVo of 95 P^r cent. Commission on dry goods equals yg^j^ of 95 per cent. = ii} per cent, iJi+S=6J{. Then, if 6JJ percent, equals $70, 5 per cent, equals $51. 9. Sold flour on commission of 4 per cent., and invested the net proceeds less my commission at 3 per cent, in salt. My whole commission was $250. What was the value of the flour and the salt? Ans. $3678.57 flour ; $3428.57 salt. 10. I invested in wheat the proceeds of a consignment of flour., less my com- mission on both, at 3 per cent., which was $60. What did I sell the flour for? And what did I pay for the wheat? Ans. Flour, $1030 ; wheat, $970. BelUvilU, fan. 2, 1894. Mr. J. H. Brown, Boug/a of S. G. Beatty & Co. 240 qross College Pens at .f 1.20, Less 5 per cent, for cash. Express charges and duties, Rec'd. payment, S. G. BEATTY & CO. At what must I sell the pens per gross to gain 20 per cent,, and allow a discount of 10 per cent, from selling price ? SOLUTION. 5 per cent of $r.2o = 6c., 1.20— 6 = $r.i4, net cash price per gross in Belleville. Charges, 21.89 = 8 per cent, of total cost in Belleville. 8 per cent, of 1.14 = 9c. + i.i4 + 9 = $i.23, advanced cost per gross. that I may gain ao per $2.40. ost him, but tit., sold it at Neither. ofit of 33^^ m the retail yard ? )er cent. e a profit of 30 per cent, receive per irill fall short in bad bebts, on cost ? $1,568. iceeds in dry ^hat was the Is, $950. Commission *♦. Then, if proceeds less . What was It. less my com- )ur for? And 2, 1894. Co. low a discount s in Belleville. f 1. 14 = 9c. + 363 PROOF. 240 gross at $1.23 = $295. 20, which, allowing for fractions, is the cost of the invoice. 20 per cent, of $1.23 = 25c. nearly ; adding this to the cost, we have $1.48 as amount to be received. Then, to obtain the selling price, i.oo-.io= 90 1.48 ■;■ .90=1.64 + . Ans. $1,64 per gross. .. PROOF. ID per cent, of $1.64= 16 + $1.64- t6 = $1.48. 13. A merchant bought an invoice of grain, which, including i^ per cent, commission, cost $5050.62, and paid $15.25 for freight. He sold the grain at a profit of 15 per cent, on its first cost, and invested the proceeds in sugar, which he sold at 5 per cent, profit, receiving a note due in 48 days, including grace. This note he has discounted at 6 per cent, at bank. What was the cost of the lirain, and how much were his profits? Ans. Cost of grain, $4994.43 ; total profits, $916.66. PARTNERSHIP. It is unnecessary to enter into an explanation of the terms Partnership, Firm, Capital, Net Insolvency, &c., as the student has already become familiar with them in working out the foregoing sets. Simple Partnership applies, when the several shares of capital have been invested for the same length of time, and the gains or losses are to be divided proportionately to the investments. Compound Partnership applies when the shares of capital have been invested for different periods of time, and the gains and losses are to be divided according to the average investments : that is, in proportion to the several amounts and times for wl ich they have been employed. .— — .^ ' SIMPLE PARTNERSHIP. To divide gains and losses between co-partners in proportion to their investments when employed for the same period of time. Rule. — As the whole capital is to each man's capital, so is the whole gain or loss to each man^s share of the gain or loss. Example 1. — H. W. Barton and William Woods engaged in business as partners, and agreed to share the gains and losses in proportion to their investments. Barton invested $9000 ; Woods, $7000. They gained $2245.62 ; what was each one's share ? SOLUTION. $9000 ' 7000 $16000 whole capital, nrooo = tV» ^'s fractional part of the capital. TFO 7C TTT nrooo = tV» ^'s fractional part of the capital. T^'^of $2245.62 = $1263. 16- B's share of gain. ' 1^ of $2245.62 = $982.46 - W's share of gain. Ox, by proportion'. $16000 : $9000 : : $2245.62 : $1263.16, B's share. 16000 : $7000 : : 2245.62 : $982.46, W's share. Analysis. — The whole capital being $16000, B's share is iVooo = tV '> a"d W's 354 IS 7000 liTOOO ^V ^^^ since the gain is to be divided in proportion to the c: share investments, B is entitled to 1"^ and W to yV o^ $2245.62, the whole gain. By proportion, $16000 : $9000 expresses the ratio of the whole capital to B's investment; and $16000 : $7000 the ratio of the whole to VV's share; and making the whole gain $2245.62, the third term of a proportion in each case, and, finding the fourth term, we have the same result as before. 2. Two merchants enter into partnership with a stock of $4300, of which A contributes $3000. They gain $1117 ; how should this be divided between them ? Ans. A's share = $779,302 B's share = $337,697 3. Three persons, A, B and C, agree to form a company, for the manufacture of woollen cloths. A puts in $6470, B $3780, and C $9860. By the end of the year they find they have gained $7890. What portion of this profit belongs to each ? Ans. A's share = $2538.453. B's share = $1483.053. C's share = $3868.493. 4. A, B and C entered into partnership with a capital of $7500, of which A put in $2500, B put in $3000 and C put in the remainder ; at the end of the year their gain was $3000 ; what is each one's share in it ? Ans. A's share = $1000. B's share = $1200. C's share = $ 800. 5. A and B have a joint stock of $4200, of which A owns $3600 and B $600 they gain, in one year, $2000 ; what is each one's share of the profit ? Ans. A's share — $1714.29. B's share = $ 285,71. COMPOUND PARTNERSHIP. To divide gains and losses between co-partners, in proportion to their investments, when their shares of capital have been employed for different periods of time. When the partners employ their capital for unequal times, the profits of each will depend on two circumstances : — \st. On the amount of capital he puts in ; and 2ndly. On the length of time it is contintied in business. Therefore, the profit of each will depend on the product of these two elements. The whole profit will be proportional to the sum of these products. Hence, the following Rule. — Multiply each man's capital by the time he continued it in the firm ; then say as the sunt of the products is to each product, so is the whole gain or loss to each man's share. Example i. — A put in trade $500 for 4 months, and B $600 for 5 months. They gained $240 ; what was the share of each ? A's capital, 500 x 4 = 2000 B's capital, 600 x 5 = 3000 OPERATION. Sum of products 5000 : 2000 : : 240 5000 : 3000 : : 240 96, A's. 144, B's. ortion to the in. capital to B's ; and making , and, finding of which A ^een them ? re = $779,302 re = $337,697 manufacture of d of the year to each ? = $2538.453- = $1483.053. = $3868.493- if which A put the year their are = $1000. are = $1200. are = $ 800. >o and B $600^ ; = $1714.29. • = $ 285.71. leir investments, iffie. )fits of each will e two elements, ts. Hence, the ! tke firm ;. then I or loss to each for 5 months. 355 . Example 2, — W. Parker, Samuel Warren and Milton Davis commenced business July I, X894, under an agreement to share the accruing gains and losses in proportion to their investments. Parker invested, July i, $20,000 ; July 19, $5,000 ; and July 25 he withdrew $230. Warren invested, July i, .$10,000. Davis invested, July i, $io,oco. Their net gain, August 31, is found to be $1441.94. What is each part- ner's share reckoning the exact time by days ? SOLUTION. The time from July ist to August 31 is 61 days. Parker's investment, July i, $20,000, for 61 days " " *' 20, 5,000, " 42 " M, 220,000 for I day. 210,000 " Amount withdrawn July 25, Total .^230, for 37 days -- His average investment Warren's investment, July i, $10 000, for 61 days " " " 10,000, " " 1,430,000 8.510 1,421,490 610,000 610,000 And by proportion, $2641490 : $1421490 : : $1441.94 2641490 : 610000 : : 1441.94 2641490 : 610000 : : I44i.;)4 Total average investment 2,641,490 I775.96, Parker's share. 332.99, Warren's " 332.99, Davis' " Example 3. — A commenced business with a capital of $10,000. Four months afterwards B entered into partnership with him, and put in 1500 barrels of flour. At the close of the year their profits were $5100, of which B was entitled to $2100; what was the value of the flour per barrel ? Ans. $7. Example 4. — On the ist of January, 1894, A commenced business with a capital of $23,000 ; two months afterwards he drew out $1800 ; on the ist of April B entered into partnership with him, and put in $13,500; four months afterwards he drew out $10,000 ; at the end of the year the profits were $8400 ; how much should each receive? , Ans. A, $6577.24; B, $1822.76. Example 5. — A and B enter into partnership, agreeing to share gains and losses according to capital invested. A invests $6500, B $5400. At the end of five months A withdrew $700, and B invested $400. At the end of the year they have gained $4200. How should it be divided ? Ans. A, $2182.09 '■> B> $2017.91. PARTNERSHIP SETTLEMENTS. When a partnership is dissolved, either by mutual consent or by limitation of contract, the adjustment of the proceeds between the members is called a partnership settlement. If, in making a settlement, the Resources are found to exceed the Liabilities, the difference is termed Net Capital; if the Liabilities exceed the Resources, the difference is Net Insolvency. The net capital at commencing is the investment of partners. If the net capital at closing exceeds the net capital at com- mencine;, the difference is the Net Gain ; if the opposite, the Net Loss. After having ascertained the net gain or net loss, the next step is to divide this gain or loss among the partners, in accordiace with the original agreement between them. This division is frequently not made in exact proportion to the amount invested ; sometimes the skill of one partner is considered equal to the capital of another ; sometimes a stated salary is allowed each partner, according to his ability or reputation ; and sometimes, where unequal amounts are invested, interest is allowed each partner on his invest- ment ; but, whether a salary or interest is allowed, such allowance must be classed as a liability of the concern, and go to reduce the gain. Note. — See page 80 for remarks on distribution of gains and losses in partnership. See also pa^es 233 to 236. c: In order to easily acquire an understanding of this subject, it will be treated under several cases, and a variety of problems will be given in each case, with examples illustrating the best mode of solving them. We have seen, in the different sets worked out, that the complete double entry ledger is reducible to three distinct parts —Resource and Liability, Ownership or Capital, and Loss and Gain ; and that these, as a whole, are in a state of balance as to debit and credit, when the result of business is ascertained, as shown in second Trial Balance, page 44. The terms Resource and Liability, as here employed, do not mclude the partners' accounts. They mean the outside property and debts of the partnership. They have no reference to the owing and being oWed as between partners, which may be treated as a resource and liability, as between themselves. It is a grave mistake to confound resource and liability springing from relations between partners, and those that arise from relations between the partnership and outside persons and things. If a creditor wishes to know the financial standing oi a Arm, he little cares how much one partner may owe another. He wants to know what and ho'v much are the resources and liabilities of the partnership, since it is the difference between these alone that gives the true status. For if the amounts with which partners are charged are to be in- cluded among the resources, the firm may make a large show of net capital, while, in fact, it is insolvent. So the partners' accounts, either as to the debit or credit, can never be included among the resources and liabilities, when the real solvency or in- solvency of a firm is sought. Therefore, in solving partnership problems, resourcf. and liability will be treated exclusive of the ownership accounts. The ownership accounts seem to be the measure of successive services of the owners for given periods of time. They represent, in fact, their past labors, whether before or after they entered into the partnership. The terms Loss and Gain represent the results of the firm's service or business during a definite period of time. Having shown that Resources and Liabilities properly belong to one class of ac- counts, and Ownership and Loss and Gain to another class, it will be readily seen in the light of the double-entry principle, how, when any two parts of the ledger are given, the third, as to its net, can be found. For we have only to contrast the ex- cesses of the TWO PARTS given, and supply the third to be found, with an amount which will produce an equilibrium between the two classes. NOTICE OF DISSOLUTION OF PARTNERSHIP FOR PUBLICATION. The partnership heretofore existing between Samuel F. Jones and John S. White, wholesale grocers in the city of Belleville, under the firm name and style of Jones & White, is this day dissolved by mutual consent. Samuel F. Jones has re- tired from the business. The assets and liabilities of the firm have been assumed by John S. White, to whom all debts must be paid. Dated at Belleville, Ontario, the tenth day of February, 1894. John S. Hall, witness. (Signed,) SAMUEL F. JONES. JOHN S. WHITE. Referring to the above I beg to announce that I have formed a partnership with James Caldwell, and we shall continue the business under the firm, name and style of White & Caldwell. * JOHN S. WHITE. By such a notice as the above being published and sent to each creditor, the outgoing partner would be relieved from any responsibility for debts contracted by the new firm. He cannot, however, be relieved of the debts contracted by the old firm until they are discharged. be treated case, with louble entry wnership or balance as n in second • the partners' They have y be treated to confound se that arise If a creditor one partner esources and le that gives ire to be in- apital, while, )r credit, can Ivency or in- LiTV will be jrvices of the bors, whether e or business le class of ac- eadily seen in he ledger are ntrast the ex- ith an amount BLICATION. and John S. ; and style of Jones has re- n assumed by JONES. ilTE. irtnership with ne and style of WHITE. h creditor, the Qtracted by the ^ the old firm 957 PROBLEMS. We will now give examples and exercises illustrating the principle of Douhle- Entrv Book-keeping in the solution of partnership problems. We will present them under three cases : Case i.— Resource and Liauilitv and Investment or Ownership iieixg GIVEN, TO FIND NeT (IaIN OR NeT LoSS, AND THE STANDING OF EACH 1'aRTNER AT CLOSING. Example.— A and B are partners. Having conducted business for a time, they close with the following property and debts. They have Cash, $3240 ; Merchandise, $2575 ; Bills Receivable, $860 ; Jno. Brown owes an account, $375. They owe on Bills Payable, $1250; and James Jones on account, $370. A invested at commencing $2500, and drew out, during business, $560. B invested $2500, and drew out, during business, $280. They agree to share equally in giuns and losses. What is the net gain durins; business ? What is the net capital of each at closing ? OPERATION. Resources and Liabilittes, Dr. $3240 25-5 8(io 3''S 70^0 l62C> 543c 4160 Cr. M250 370 1620 Resources at closing. Liabilities " Present worth of firm. Credit excess of ownership. 1270 Net gain during business. 635 A's \ net gain during business. 635 B's '• Ownership. Dr. $1560 A withdrew 280 B 840 Cr. .^2500 2500 Total investment 5000 " withdrawn 840 Firm's net investment 4160 PROOF. A's investment " withdrawal *' net investment " J net gain " net capital at closing $2500 560 1940 635 2S7S B's investment .... " withdrawal " net investment " \ net gain I " net capital at closing Add A's net capital Present worth of firm $2500 280 2220 .... ^ .... 285s ■ • 2575 .... S430 In Double Entry Book-keeping, the net worth as shown between the resources and liabilities, or the difference between the sides of the " Balance Account" must correspond exactly with the balance of the Stock account, or the combined balances of the Partners' accounts after the loss or gain has been entered in them. In the above solution the difference between the resources and liabilities is $5430, while the difference m the capital or ownership account is but $4160, hence the ownership accouni; must be credited with the difference $1270 to complete it and make its balance equal to the resource and liability balance. This amount is the net gain. If the balance of the ownership account were larger than the resource and liability balance, the difference would be entered on the debit side ^nd wou'4 be the net loss. 368 1 m 4 2, — A and B having conducted business one year as partners close with the following resources and liabilities. They have Cash in bank, $3456 ; Mdse., per inventory, $2120 ; Bills Receivable, $1874. E. A. Corby owes $630. They owe on Bills Payable $3250 ; W. G. Smith, on account, $346. A invested, at commencing, $1500, and drew out $175. B invested $1500, and drew out $315. What is the net gain and the net capital of each at closing? Ans. Net gain, $1974. A's net capital, $2312. B'a, $2172. , 3. — A and B are partners, equal in investments and in losses and gains, and close with the following resources and liabilities : They have cash in bank, $3675 Mdse., per inventory, $1824; Bills Receivable, $1256; Real Estate, $2000 ; Bank Stock, $1884. They owe on Bills Payable, $2570 ; on Mortgages Payable, $1278 ; Accounts Payable, $3275. A invested $5000, and drew out $5486. B invested $5000, and drew out $6250. What is the net gain, and also net capital of each at closing ? Resources and Liabilities. Dr. $3675 1824 1256 2000 1884 10639 7123 3516 1736 Resources at closing. Liabilities " Present worth of firm. Debit excess of ownership. 5252 Net gain, at closing. 2626 2626 A's \ net gain. B's " " OPERATION. Cr. $2570 1278 327s 7>23 Ownership. Dr. $5486 6250 1 1736 amount withdrawn. 10000 " invested. 1736 Cr. $5000 5000 lOOOO PROOF. A's investment " withdrawal ' ' overdraw " \ net gain •" net capital at closing 4. — A and B close business as follows Fixtures, $383 ; Mortgages Receivable, $3485 ; Bills Receivable, $826. They owe on Bills Payable, $2450 ; on Accounts, $1240. A invested $6000, and a debt of his to the amount of $1000 was assumed by the firm at commencing, and paid during business. He also drew out, at different times, $685 ; and is allowed interest on capital invested, $420. B invested $4000, and drew out, during business, $1860, and is allowed interest on capital, $280. A is to share 3-5 and B 2-5 of gains and losses. What is the net loss ? What is the net capital of each ? $;ooo S846 B's investment " withdrawal .... $5000 6250 486 2626 " overdraw " i net gain 1250 2626 2140 " net capital at closing Add A's net capital . . . . 1376 2140 Present W01 th of firm . ... 3S«6 follows : They have Cash, $1424 ; Mdse., $i«;62; se with the Mdse., per bey owe on ommencing, V^hat is the 4. A's net gains, and ink, $3675 zooo ; Bank ble, $1278; B invested il of each at Cr, $5000 5000 lOOOO $5000 6250 1250 2626 ^ 1376 2140 35«6 ,$i<;62; S. They owe I a debt of his id paid during ;d interest on ss, $1860, and ins and losses. ^dse 359 OPERATION. KcxoiiiiiS ami Liabilitits, Dr. 91424 1562 383 3485 826 7680 Kesuurces at closing 3690 Liabilities 3990 ^ PrcsenI worth of firm. Cr. #2450 1240 #3690 Oxvucrship. Dr. 9iooo 685 i860 3545 Investment Withdrawal .... Net investment .... Debit excess ol K. iV L. Net loss during business A's 3-5 of net loss B's 2-5 " " " TROOF. A's investment " withdrawal ... " net inve.stment "3-5 net loss *• present interest .%420 1685 4735 1899 2836 B's investment .... " withdrawal .... " Net investment " 2-5 net loss ... " present interest Add A's interest Presi'h' worth of firm Cr. 420 4000 280 10700 3545 715s 3990 3'65 1899 1266 84280 i860 2420 1266 1154 2836 3990 5.— Jones and Brown close business with the following results: They have Cash on deposit, $3421 ; Mdse., $5789; G. T. R. Stock, $4321 ; Bonds and Mort- gages, $6452; Montreal Bank Stock, $3689; Real Estate, $1724; Notes and Acceptances, $432; Accounts Receivable, $321. T!iey owe on Notes and Accept- ances, $8924; on Accounts Payable, $3479. Jones invested $12000. The firm assumed a debt for him of $1500. He drew out, during business, $6co, and is allowed interest, at closing, $1000. Brown invested $6000. The firm assumed a debt for him of $750. He drew out during business $300, and is allowed interest, $500. Jones is to share Yi and Brown Yi of the gams and losses. What is the net loss? What is the net capital of each at closing? Ans. Net loss $2604 ; Jones' net capital is $9164; Brown's, $4582. 6. — A and B close business, and wish to know the financial standing of each. They have Cash on hand, $2263; and Real Estate worth $5000. They owe on Mortgages Payable, $3846 ; on Notes, $4462 ; and on Personal Account, $675. A invested $6000, and withdrew during business, $2860. B invested $4000, drew out, during business, $5560, and is allowed for extra service, $250. A shares 3-5 and B 2-5 of gains and losses. What is the net loss ? What is *he financial standing of each at closing ? OPERATION. Dr. $2263 5000 7263 Liabilities at closing Resources '" . . . Insolvency of firm . . . Resources and Liabilities. 1720 Cr. Dr. $3846 $2860 4462 5560 675 8420 8983 Investment 7263 Withdrawal O^vnership. Cr. $6000 4000 250 10250 8420 Net investment .... Credit excess of R. & L Net loss during business A's 3-5 of net loss .... B's2-S " " 1830 1720 3550 2130 1420, 360 PROOF. c: A'r inveitment '* withdrawal " net invettment •• 3-s net loss " net capital $6cxx) 2860 3140 2130 lOIO B'b invettment . . . " withdrawal " overdraw " 2-5 net less . . " net insolvency Deduct A's net capital Insolvency affirm . . . I42SO 5560 1310 I4iO 3730 1010 1720 7. — A and B dissolved partnership, and wish to know the financial standing of each. They have Cash, $2653.26 ; Bills Receivable, $1258.16 ; and amounts due on Personal account, $2831. They owe on Notes outstandinc;, $4428.50 ; John West, on account, $1234.60 ; Wm. East, on account, $1380.40 ; George South, on account, $1290.77. A invested $3000, and drew out $550. B invested $2000, drew out $3525, and is allowed for extra services, $175. A shares 3-5 and B 2-5 of the losses and gains. What is the net loss ? What is the financial standing of each at closing ? Ans. Net loss, $2691.85 ; A's net capital, $834.89 ; B's net insolvency, $2426.74. Case 2. — Resource and Liability, Loss and Gain, and amounts added OR WITHDRAWN BY PARTNERS GIVEN, TO FIND NeT CAPITAL OR NeT INSOLVENT AT Commencing. Example i. A and B close business and wish to ascertain results. A invested Yi and B yi of the capital, and they agree to share losses and gains in the same pro- portion. They have at closing the following resources : Cash, $5474.50 ; Mdse., $2584.23 J Notes, $946.30 ; Fixtures worth $314.80. They owe on Notes, $875 75 ; and on account, $364.12. They have lost $2345.62, and gained $4526.23. What was the net capital at commencing ? What is the net capital of each at closing ? OPERATION, Resources ami Liabilitiea, Dr. «5474-So 2584.23 946.30 314-80 9319.83 Resources at closing. 1239.87 Liability " Cr. $875.75 364.' 2 1239.87 8079.96 Present worth of firm. 2180 61 Credit excess of ownership. 5899.35 N. C. at commencing. 3932 90 A's Yi 1966.45 B's Yi A's Y investment " Y net gain " present interest Ownership. Dr. $2345.62 Net gain in business A's Yi "ct gain B's>^ " .... Cr. 14526.23 2345-62 2180.61 145374 726.87 PROOF. $3932.90 1453-74 5386.64 B's B's Y net gain " present interest Add A's interest Present worth of firm $1966.45 726.87 2693.32 5386.64 8079 96 Note. — The excess of debit of resource and liability values is $8079.96. The excess of credit of the ownership values is $2180.61. The difference of these excesses is a final debit of $5899.35. Therefore, this is the amount of net capital at commencing, because it will make the excesses in the two classes equal. This is proved by the adjustment of the partners' accounts, since the capital of the two equa's the present worth, as shown by the difference between the resources and liabilities, . . . 14250 .... 5560 . .. i3«o 14^0 .... 2730 .... loio 1720 standing of )unts due on John West, on account, t)o, drew out of the losses :h at closing ? $2426.74. UNTS ADDED r Insolvent A invested the same pro- 4.50 ; Mdse., tes, .1875 75 ) 6.23. What closing ? Cr. 14526.23 2345.62 2180.61 145374 726.87 $1966.45 726.87 2693.32 5386.64 8079 96 lit of the ownership the amount of net r the adjustment of ference between the 361 a. — A and B have conducted business one year, and wish to know the present interest of each. The former invested yi and the latter y\ of the capital, and they agreed to share gains and losses in same proportion. 'Ihey have, at closing, the following resources : Cash, 113724.15; Real Flstate, #2356.14; Notes and Drafts, $1762.18; Fixtures and unexpired rent, .^942. 12. They owe on Notes, .f 14^6.22, and on Book Accounts, !i^5i9 33. Their losses have been )Bi345.7i| and gains, #4625.55. What was the net capital invested by the firm ? What is the net capital of each at closing? Ans. Net capital invested, #3559.20. A's net capital, at closing, is #4559.36 ; and B's #2279.68. 3. — A and B, wishing to know their present interests, give the foUot^'ing data : They invested equally, and share in the same proportion the losses and gains They have money on deposit, #1875.35 > Lumber, #1532.50 ; Notes and Personal Accounts, intheii favor, #684.41. They owe on Notes outstanding, #784.24: and on Personal Accounts, #365.40. Their losses have been #3464.12 ; and c;ains, #1639.46. A drew out, during business, #2232.50 ; and B lent the firm, #1764.50. What is the net capital or insolvency of each ? OPERATION. Dr. »i87S.35 1532.50 684.41 4092 26 1149.64 2942.62 2292.66 Resources and Liabililies, Resources at closing. Liabilities " Present ivorth oj firm. Debit excess of ownership. Cr. $784. 24 365-40 1149.64 5235.28 Net investment of firm. 2617.64 A's \ net investment. 2617.64 B's " •• A's \ investment at commencing " withdrawal *' net investment .... " \ net loss " insolvency at closing Ownership. Dr. 1J346412 2232.50 5696.62 3403.96 2292.66 Losses during business Gains Net loss of firm A's \ net loss B's i PROOF. $2617.64 2232.50 385.14 912.33 527.19 B's i investment at commencing " loan to the firm " net investment " i net loss ... " capital al closing .... Deduct A's insolvency .... Cr. $1639.46 1764.50 .3403-96 3464.12 1639.46 1824 66 912.33 91233 $2617.64 1764.50 4832.14 9«2.33 3469.81 527. >9 Present ivorth of firm .... 2942.62 Note. — Here the difference of resource and liability values is a deHt of $2942.62 ; and the difference of the ownership is a debit of $2292.66 ; consequently, they are added, giving us $5335. :>8, ns the net amount invested by the firm. Such an amount must have been invested for the reason that it, with the other ownership values, is required tn make the excess of credit among the ownership class equal to the excess of debit among the resource and liability class. This is abundantly proved in making up the partners' accounts, A turns out insolvent, $527. 19, and B has a net capital of $3469.81, the difference of which just equals their present worth, as shown by the resource and liability values. In final settlement, therefore, it will take the net amount of property owned by the firm and A's indebtedness to pay off B. 4. — A and B close business, giving the following data for the adjustment of their accounts ; They invested equally, to share in like proportion. They have Cash, $2425.12; Furniture and Fixtures, #1832.14 ; Notes and Acceptances, #1756.17; and Verbal Promises, #354.50. They owe on Notes and Acceptances, #2865.50, and on Verbal Promises, #842.75. Their losses have been #3426.39, and gains, #1864 69. A drew out #2564.24, and B lent the firm $375.20. What was the net capital of the firm at commencing ? What is the present financial standing of each at closing ? Ans. Net capital at beginning, $64io.43 ; A's net insolvency, at closing, $139.88 ; B's net capital is $2799.56. 362 ii •« c 1 5. — A, B and C, wishing to know the financial standing of each partner, give the following data : They have Cash, I3464..S0; Bills Receivable, .11325.80 ; Accounts Receivable, ^275. 36; and Interest Receivable, $126.38. They owe on Notes, $2538.60 ; on Accounts Payable, $734 40 ; and on Interest Payable, $135.26. Their losses have been $1375.37, and gains, $6364.90. A drew out $850 ; B drew $620 ; and C lent the firm $1250. What was the net insolvency of the firm at commencing ? What is the financial standing of each at closing?— it being understood that they were equal in their insolvency at beginning, and that they agreed to share equally the losses and gains. OPERATION. Resources and Liabilities. Dr. $3464.50 1325-80 27536 126.38 5192.04 Resouices at closing;. 3408.26 Liabilities " Cr. 12538.60 734-40 135.26 3408.26 1 783. 78 Present worth of firm. (hunership and Gains ami Losses. Dr. ««375-37 850.00 620. GO 2845-37 Debit excess of R. and L. Net insolvency at commencing A's y^ N. I. " B's Yi " C'sj^ ' Gains during business Losses " " Net Gain A's y net gain .... B's>^ " *' C'sJ^ •• " Cr. $6364.90 125.00 $7614.90 2^45-37 4769.53 1783.78 PROOF. A's net insolvency at commencing . " withdrawal " insolvency without the gains . *• 1^ net gain " ;'asolvency at closing B's net insolvency at commencing . . " withdrawal " insolvency without the gains . . •' Yi net gain $995-25 850.00 1845.25 1663.17 182.08 995-25 620.00 1615.25 1663.18 C's net insolvency at commencing. " loan to the firm " net investment " Yi "^' g^i" " net capita! at closing Add B's capital C and B's capital Deduct A's insolvency Present luoith of firm 2985.75 995.25 99525 995-25 6364.90 1375.37 498953 1663 17 1663.18 1663.18 % 995-25 1250.00 254.75 1663.18 1917.93 47.93 1965.86 182.08 1783.78 " net capital at closing 47-93 6. — A, B and C, at the end of one year's business, wish to know the financial standing of each partner. They have, at closing, Cash, $2375.15 ; Bills Receivable, $1246.82 ; Accounts Receivable, $385.46 ; and Interest Receivable, $138.50. They owe on Bills Payable, $1872.50 ; on Accounts Payable, .$634.80 ; and on Interest Payable, $125.70. Their losses have been $1482.27, and gains, $6836.80. A drew out $1650, B drew $450, and C loaned the firm $1475. What was the firm's net insolvency at commencing, and what is the financial standing of each at closing ?— the partners being equal in their insolvency at starting, and sharing equally in losses and gains at closing. Ans. Net insolvency at commencing, $3216.60 ; A's insolvency at closing, $937.36 ; B's net. capital, $262.64; C's net capital, $2187.65. rtner, give the 80 ; Accounts ve on Notes, 35.26. Their B drew $620 ; commencing ? tood that they share equally (ti Losses. Cr. $6364.90 125.00 $7614.90 2^45-37 ug. 4769.53 1783.78 2985-75 995-25 99525 995.25 6364.90 1375.37 4989.53 1663 17 1663.18 1663.18 i 995-25 1250.00 254.75 1663.18 1917.93 47.93 1965.86 182.08 1783.78 )w the financial ills Receivable, I138.S0. They ind on Interest 36.80. A drew s the firm's net h at closing ? — squally in losses ; A's insolvency 65- 363 7. — A and B give the following data for adjustment : They were equally insol- vent at starting, and agreed to share equally in the losses and gains. At cl sing they have only the following property : Cash, $1365.50 ; and Notes and Personal Accounts amounting to $2326. They owe on Notes, $3570.75 ; A. W. Parker, on account, $835.25; and E. A. Kyle, on account, $545.25. Their losses have been $2264.25, and gains, $3628.50. A drew out $1150.75, and B lent the firm $550.75. What was the firm's insolvency at commencing ? What is the financial standing of each partner at closing ? « In this case the resource and liability values have an excess of credit, $1259.75, and the ownership values an excess of credit, $764.25. Both excesses being credi/s they have to be added to effect a correspv^nding debit, and thus throw the two classes of values into opposite and equal excesses. The sum, therefore, of the two, which is $2024, is the amount of insolvency with which the firm began, since all the other values, except those which show the state of the ownership at commencing, are given in the problem. That the $2024 was the insolvency of the firm at commencing is proved by making up their accounts on this basis. OPERATION. /Resources and Liabilities. Dr. $1365.50 2326.00 3691.50 Liabilities at closing .... Resources " .... Insolvency of firm at dosing Ownership. Cr. Dr. $3570.75 835-25 545-25 4951.25 3691.50 $2264.25 1150-75 3415.00 1259.75 Credit excess of R. & L. Insolvency at commencing A's i of insolvency B's i Gains during business . . Losses " Net Gain , A's i net gain B'si •• PROOF. A's i N. L at commencing " withdrawal .... " insolvency, without the gains. . " 4 net gain .... N. L at closing .... $1012 00 1150-75 2162.75 682.12 1480.63 B's i N. I. at commencing ** loan to the firm " insolv., without the gains " i net gain .... " net capital at closing A's net insolvency " Insolvency of firm at closing Cr. $3628.50 550-75 4179.25 3415.00 764.25 1259.75 2024.00 1012.00 1012.00 3628.50 2264.25 1364.25 682.12 682.13 fIOI2.0O 550.75 461.25 682.13 22088 1420 63 125975 8. — A and B wishing to adjust their affairs give the following data : They have Cash on hand $6023.50. They owe on Notes and Acceptances, $4680.50, and on various Personal Accounts, $3490.75. Their losses in business have been $3375.75, their gains $5874.75. A drew out, during business, $2260.25, *"cl B lent the firm $660.50. They set out equally insolvent, and agreed to share equally in losses and gains. What was the net insolvency at commencing ? What the finanv-ial status of 364 ti c: each at closing ? Ans. Insolvency of firm at commencing, $3047 ; A's net insolvency at closing is $2534.25 ; B's net capital is .I386.50. Case 3. — Ownership and loss and gain being given, to find net resource or net liability. It will hardly be necessary to give examples and exercises under this case, for the reason that, when Ownership and Loss and Gain are given, we know, on the principle of equality of excesses between the two classes of values, that the difference of the values of Ownership and Loss and Gain always corresponds with the difference of the resource and liability values. And if all the Ownership and Loss and Gain values have an excess of credit, it presupposes an excess of debit among the resource and liability values, and that such excess of debit is a net resource ; while if there be an excess of debit among the Ownership values, there will be a corresponding excess of credit among the other values, and that excess will be a net liability. It will be seen, therefore, that to find the financial status of a firm, whether con- stituted of one or more parties, it is only necessary to consult the capital and loss and gain accounts, which, as compared with the resource and liability accounts in most kinds of business, are very few in number. The proprietoi's or proprietors' accounts show investments and withdrawals of properly ; while the loss and gain accounts represent the increase and decrease of property by means of services during given periods of time. There is another point coming appropriately under this head. It sometimes occurs that the only accounts given are the partners' — all the real accounts being cancelled. Suppose, then, two or more partners have got their business all wound up, save the adjustment of their own account. They have divided up the property and been charged with it. They have either paid off all their debts, or each is assumed io pay certain amounts, and thus cancelled the partnership debts. This being done, how shall the partners settle as between themselves ? They have only to find the difference of all the values constituting the ownership ; and if that difference be a debit it shows the net gain of the firm ; if a credit, a nei loss. This net gain or net loss is the amount wanting to restore the balance of co- equal exchange of values. Then if this net gain or loss be divided between the partners according to agreement, the difference of each partner's account will be each one's financial status. Then if the partner's accounts are not all equal as to debit and credit, the owing partner or partners must pay over to the partner or partners owed, when all will be adjusted. ANOTHER FORM OF WORKING PARTNERSHIP SETTLEMENTS. We will now give a few examples worked out by another method, which may also be solved by the form already illustrated. Example i. — A and B, having been in business i year, dissolve partnership. B retires, leaving A to continue the business and liquidate the debts of the firm. A invested $12,000, B $10,000. Each is to receive interest on his investment, and share the gains and losses equally. How much did each gain ? What is A's capital at closing, and how much should be paid B on retiring, the resources and liabilities being as follows : net insolvency resource or net r this case, for know, on the t the difference 1 the difference Loss and Gain ng the resource lile if there be ponding excess 1, whether con- tal and loss and counts in most ietors' accounts I gain accounts :s during given It sometimes accounts being iness all wound ip the property ibts, or each is ip debts. This ; the ownership ; if a credit, a nei i balance of co- 2d between the unt will be each jqual as to debit •tner or partners rLEMENTS. hod, which may partnership. B of the firm. A investment, and hat is A's capital ces and liabilities 365 Resources. Ca.sh on hand, Personal debts due firm per Ledger, $12,000 Less 25 per cent, for bad debts, 3,000 Mdse. as per inventory. Bills Receivable, Mortgage Rec, Accrued interest on above, Real Estate (store and lot), Store Fixtures, Total Resources, Total resources, " liabilities, $5,000 9,000 16,530 3.500 4,000 120 6,500 350 45.000 OPERATION. Liabilities, Personal debts firm owe per Ledger, Bills payable. Interest on notes and drafts, Total Liabilities, $S,l7o 4,200 130 12,500 Firm's net capital at closing, Interest on A's investment 1 12,000 for i year. B's " 10,000 Firm's net capital at closing, A's investment, $12,000 Interest for i year 720 . $12,720 B s investment $10,000 Interest for i year 600 $10,600 $45,000 12,500 .$32,500 I 720 600 32,500 Firm's net gain in business, A's investment $12,000 Interest for i year 720 His J net gain 4. 590 A's net capital $17,310 A's net capital, B's Firm's net capital, as before, B's investment Interest for i year His i net gain B's net caoital $17,310 15.190 .?32,5oo $23,320 $ 9.180 10,000 600 4.590 $15,190 D and E are partners : each invested .$3000, and agreed to share the gains and losses equally. During the year, D drew out |6oo, and E -fsoo. What were their gains at the end of the year, their resources and liabilities being as follows : Resources. Cash on hand. $3,500 Mdse., as per inventory. 3,600 Bills Receivable, 1,200 Debts due firm, as per Ledger, 2.500 Total Resources, $10, 800 Liabilities. Debts firm owr, as per Ledger, $1,500 Bills Payable, 800 Total Liabilities, 2,300 Firm's net capital at closing, D invested, $3,000 Less amount withdrawn, 600 $8,500 D's credit balance, E invested, Less amount withdrawn, E's credit balance. Balance of investments, 3,000 ■">co $2,400 $2,500 Firm's net gain, 4,900 53,600 PROOF. ;4 9*»n> D invested Withdrew i net gain, D's net capital at closing, 53.000 600 4,200 1,800 E invested Withdrew i net gain. $4,200 D's net capital, E's net capital, Firm's net capital as above. E's net capital at closing. J3.000 500 2,500 1,800 $4,300 $4,200 4.300 $8,500 3. — A, B and C form a partnership; A invests $15,000, B $[2,000, and C, nothing. They share the g^ins and losses as follows, viz. : A ^, B ^, C J^. A draws out during the year $800, B $900 and C $400. What is each partner's capital, and what are the gains at the end of the year, when their resources amount to $40,000 and their liabilities to $44,000 ? OPERATION. Liabilities, Less resources. $44,000 40,000 $4,000 A's investment, $15,000 Less amt. withdrawn, 800 $14,200 Firm's net insolvency, B's investment, $12,000 Less amt. withdrawn, 900 11,100 A's J loss, B's y, *• C's ye " $14,450-00 9.633-33 4,816.67 Less amt. withdrawn by C, Firm's net investment. Add Firm's insolvency, 25-300 400 24,900 4,000 Total losses, A's investment, Less amount withdrawn. $28,900.00 15,000.00 800.00 Film's net loss, A's i loss, Net Investment, A's net insolvency, C's ye loss. Add amount withdrawn, 28,900 '4,450 14,200 B's investment, Less amount withdr .wn. $14,200.00 12,000.00 900.00 250 $4,816.67 400.00 Less his >^ loss, 1 1. 100.00 9,63333 C's net insolvency. 5,216.67 B's net capital A's C's $1,466.67 insolvency. $ 250.00 5,21667 Deduct B's net capital, 5,466.67 1,46667 Firm's net insolvency, $4,000.00 In which a salary is allowed each partner. No interest account kept. 4. — A, B and C entered into partnership, January ist, 1893. A and B each invested $7000, C invested $14000. A's share of the gains or losses was )^, B's ^, and C's y^.. A was to receive a salary of $1000 per year, \\ $1500 and C $500 for services. A drew out $650, B $450 and C $900. What was each partner's interest in the firm, January ist, 1894, when thefr resources were $54,500, and their liabilities Bilb Mds G. $3,ooo 500 2,500 1,800 $4,300 :oo 100 ;oo 2;00o, and C, J /3, C J^. A irtner's capital, sunt to $40,000 ,000 800 $14,200 ,000 900 11,100 25.300 400 24,900 4,000 28,900 14.450 14,200 250 M.816.67 400.00 5,216.67 .00 J67 5 67 0.00 It kept. A and B each s was %, B's %, and C $500 for partner's interest nd their liabilitieb Resources, Liabilities, A's investment, Add salary. Less amount withdrawn, A's credit balance, B's investment, Add salary, Less amount withdrawn, B's credit balance, C's investment. Add salary Less amount withdrawn, C's credit balance, 3fi7 OI'ERATION. Firm's net capital, .$7,000 1,000 8,000 650 5 $7,000 1,500 8,500 450 $54,500 13,500 $41,000 7.350 8,050 14,000 500 14,500 900 13,600 Firm's net gain. A's credit balance " % gain. Net capital. $7,350 3,000 $10,350 Proof. — A's net capital B's C's B's credit balance, " % gain. Net capital. 29,000 $12,000 ^8,050 C's credit balance, $13,600 3,000 " ^ gain 6,000 ? 11,050 Net capital, $10,350 11,050 19,600 $19,600 Firm's net capital, as above, $41,000 In which amounts withdrawn arf. averaged, and interest is charged and allowed. 5. — A and B entered into partnership January ist, 1894. A invested $12,000, an;i iJ $14,500, the gains and kisses to be shared equally ; each partner to be allowed 6 per cent, on his investment, and to be charged at the same rate on sums drawn out. A drew as follows : March ist, $300 ; July 9th, $250 ; September loth, $joo ; December i6i.h, $150. B drew April 7th, $100 ; August 4th, $400 ; November 23rd, $250. What was each partner's interest January ist, 1895, their resources and liabilities being as iVilows : Kesources. Liabilities. Cash, $ 3,600 Personal debts firm owe. $11,500 Personal debts due firm. l6,G0O Bills Payable, 500 Bills Receivable, 1,400 Mdse., as per inventory. 26,000 Total liabilities. $12,000 G. T. R. K. Stock, 6,000 Firm's uet capital, 41,000 Total resources, $53,000 $53,000 Average date of amount • ithdrawn by A, july 6th. •• " " " B, Aug. 26th. 368 A's investment, 1 ll2,ooo B's investment, $14,500.00 Less amt. withdrawn, 900 $11,100.00 Less amt. withdrawn, Interest on investment, 750.00 $13,750.00 Interest nn investment, $12000 for I year. 720.00 $14,500, for I year, 870.00 Less interest on $900 Less interest on $750 withdrawn, from withdrawn, from average date, July average date, Aug. / 6th to Fan. ist (178 26 to Jan. I (127 days). 26.70 693-30 days). 15-87 854.13 A's credit bal., $11,793-30 B's credit balance, $14,604.13 Firm' s net capital $41,000.00 A's credit balance, $11,793-30 B's s net gain. 14,604.13 26,397.43 Firm $14,602.57 A's investment, less amount B's investment, less amount withdrawn, $11,100.00 withdrawn, $13,750.00 Credit balance of interest. 693.30 Credit balance of interest, 854.13 His ^ ^ain. 7,301.29 $19,094.59 His i gain, B's net capital, • 7,301.28 A's net capital, $21,905.41 Firm's net capital, as above. l?'4l,ooo. 6. — A and B commenced business as partners. A invested .^20,000, and B 1 1 0,000, A sharing fi and B ys of the gains and losses. No interest account was kept. A drew out $1700 and B .$2150. Their assets at the close of the year con- sisted of — Cash, $4200 ; Bills Receivable, .|88oo ; Mdse., $26,000 ; and Personal Debts, $16,000. 10 per cent, in the personal debts are considered bad. Their liabilities are — Bills Payable, ^3250; Personal Accounts, $11,250. If B should retire from the firm, how much ought he to receive ? ylsscis. Cash, Bills Receivable, Mdse., Personal accts., less 10 per cent.. Add amount drawn out. Dr. A's ar.r.t. Drawn out, Balance, B's acct. Drawn out, Balance, $4,200 8,800 26,000 14,400 53.400 3,850 $57,250 1,700 26,800 28,500 2,150 I?. 100 1:14,250 Liabilities, Bills Payable. Personal accounts. $3,250 11,250 Capital invested, 14,500 30,000 Firt/i's net gaiti, 44,500 12,750 Cr. Capital, % net gain, Capital, Yi net gain. $57,250 20,000 8.500 28.500 10,000 4.250 $14,250 - .oo .00 013,750.00 ).00 t i.87 854-13 $14,604.13 $13,750.00 854-13 7,301.28 $21,905.41 20,ooo, and B St account was " the year con- ; and Personal d bad. Their If B should $3,250 11,250 14,500 30,000 44,500 12,750 $57.25 20,000 8,500 28.500 10,000 4.250 $14,250 369 TO REDUCE DOLLARS AND CENTS TO STERLING MONEY. KvhV..— Divide the given sum by the value of £\ sterling (4.8666), the quotient will be pounds sterling and decimals of a pound. Reduce the decimal part to shillings and pence. Example. — Reduce $749.83 to sterling money. OPERATION. 749.83 ^ 4.866 = ;^i 54.0641 =^154 IS. 3i^d. Ans. EXERCISES. 1. Reduce $1006.90 to Sterling money. Ans. ;^2o6 17s. 7^d. 2. Reduce $916.87 to sterling money. Ans. ;!^i88 7s. 8^d. 3. Reduce $2114.81 to sterling money. Ans. ;^434 los. 4^d. TO REDUCE STERLING MONEY TO DOLLARS AND CENTS. Rule. — Express the given sum decimally, and multiply by the par value of ;£i sterling {$4.8()66). Example. — Reduce ;;^78 iis. 4 ^d. to dollars and cents. OPERATION. ^^78 IIS. 45<^d. = ^78.5697916 and ;^78.56979i 6x4.8666 = $382. 399. Ans. EXERCISES. 1. Reduce ;^2043 iis 3d. sterling to dollars and cents. Ans. $9946.01868. 2. Reduce ;^777 7s. yd. sterling to dollars and cents. Ans. $3783.50437. 3. Reduce ;^'5S7 19s. 5>^d. sterling to dollars and cents. Ans. $2715.65418. Note.— The present par value of the £ sterling is $4 8666+, which is gl^X advance upon the old par $4.44 4-9. Hence, if Sterling Exchange is quoted at 1.08K, or anything other than i.ogj^, it is not at par, in which case the 8 or 8J4 per cent., or whatever it may be, is added to the old par, thus *y^ + Tu ^^ '^f' ~ Ar "^ lio ~ $4.80, JUST PUBLISHED. THE SEVENTH EDITION OF JOHivrsoiNr's Joint Stock Company Book-keeping. a BTT J. -W. JOHlSrSOIT, i'. C. .&.. %%\^^W%'V^%>.NX'^'V%N%VN%%XV%,'^-. c: The first portion of the work is devoted to the laws affecting Joint Stock Com- panies, and to the methods of forming them. The second portion of the work illustrates in a comprehensive manner, the system of properly recording the transactions throughout a year, and arriving at the accurate results, auditing and presenting statements of the business of a Joint Stock Company, by methods which the author has matured from long practical knowledge and experi- ence as an accountant and auditor in large business centres, and later as a teacher of accounts. In addition to this, much valuable information is given, and explanations are made regarding technical matters specially appertaining to Joint Stock Companies. Since the first edition was published the author has had the most gratifying evidence from all parts of Canada and the United States, that the work has proved to be what it was intended for — an efficient aid and instructor in conducting the office work of a Joint Stock ("ompany. The sale of the book now extends from the Atlantic to the Pacific throughout both countries. The best evidence of its merit is the fact that seven pdi>'o.is have been issued to meet the demand for it. In the present edition, as in previous ones, new and practical subjects have been added, and others enlarged upon. The work contains 135 octavo pages. Price $1.25, post paid. Address, ROBINSON & JOHNSON, Ontario Business College, Belleville, Ont. EPING. Stock Com- r, the system the accurate ;k Company, ; and experi- a teacher of explanations : Companies. )st gratifying : has proved nducting the ids from the )f its merit is :ts have been " Piomissoni Holes, Dralts i GHepes," By J. W. JOHNSON. P. O. A. The Fifth Edition of this Work Has Just been Published. It conveys in a clear, concise and easily understood way the knowledge which every intelligent business man should have regarding Promissory Notes, Drafts and Cheques ; and also deals with the Book-keeping in connection with them. The Student of Accounts will find it invaluable in preparing for the examin- ations prescribed by the Department of Education for Commercial Specialists in High Schools, and for the examinations for the Certificate or Diploma of the Institute of Chartered Accountants. 51 OCTAVO PAGES. PRICE 50 CENTS. Address, ROBINSON & JOHNSON, Ontario Business College, Belleville, Ont. I lie, Ont. ONTftRIO BUSINeSS coLLese. .050^^ BELLEVILLE, Ont., CANADA. 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