LIBRARY
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FARM ACCOUNTING
-FOR-
The PRACTICAL FARMER
— BY-
LLOYD E. GOODYEAR
1911
Goodybar-Marshall Publishing Co.
Cedar Rapids, Iowa
tUHQ
Copyright, 1911.
Goodyear-Marshall Publishing Company.
Farm Accounting.
The farm is a factory in which thought, money, and labor are applied to soil and natural
forces in order to combine them into produce for consumption. So long has mankind been
engaged in farming that many of its processes can be followed by persons with very little
conscious learning, and with no account keeping, just as in former times, it was easy to
secure game with a simple bow and arrow. The fact that a certain amount of farming suc-
cess can be attained without bookkeeping, has made the farm the one kind of factory where
bookkeeping has not in the past been universally deemed necessary. Other factories, un-
less quite small, can no longer run successfully without careful attention to accounts. The
larger the establishement the greater the need of bookkeeping, until we reach the great iron
works, wood works, machinery works, clothing works, etc., 'where, if the books were not
kept for a single day, confusion would reign, and where if books were not kept for a single
month, dissolution would set in.
At the present time, we are beginning to witness the coming of men skilled in account-
ing, who have applied their skill to the farm with the result that large farm chains are be-
ing organized, replacing the many small farms which are not safeguarded by a scientific
system of accounting. Those who think clearly cannot fail to see that a proper accounting
system reduces the labor and mental strain of the prosperous farmer, while the farmer who
is still struggling with large payments and small income, must depend on account keeping
until his books have guided him to at least a comfortable degree of success. One must get
the account keeping attitude now-a-days, if he would master his business.
The stories of the successes of our fore'fathers in subduing the wilderness with their
vast physical energy, like the stories of knighthood in the middle ages, should contribute
the qualities of heroism and chivalry to the sons. But the sons cannot make any eminent
success in business today unless they add to their forefathers' vigor, the incisive judgment
and adaptability to surroundings demanded by present commercial development. The mod-
ern guide to success is the intelligently kept ledger; the modern consultation room is the
bookkeeper's desk. The proper study of accounts will do much to restore to the farmer the
primary standing which has been usurped by other masters of business where bookkeeping
is more highly specialized.
This set may be classed as belonging to advanced accounting in the sense that it is a
complete scientific scheme of accounting equal in grade with that used by the banker or mer-
chant. In operation it is simple and should not, on an ordinary farm, require more than five or
ten minutes per day for its successful use. The principles given are to be thoroughly mas-
tered but when once mastered they should be adequate to future needs.
We hope to see in time to come the evidences of well kept books in the material pros-
perity of the thousands of farms that adorn the thorofares East, West, North, and South.
217131
FARM ACCOUNTING
PREPARATION
It is assumed at the outset that the student is famihar with ordinary business papers and
legal forms. Among these are included the note, check, draft, receipt, bill or invoice, bank
book, deposit ticket, statement ot account, duplicate order and other carbon duplications, let-
ter, envelope, R. R. bill of lading, R. R. expense bill, stock certificate, telegram, C. O. D.
form, lease, common agreement, bill of sale, deed, mortgage, release of mortgage, insurance
policy, proof of loss, etc. There are few, if any, general business forms that will require par-
ticular attention in a study of this kind.
In bookkeeping the student is expected to know the double entry principle and to use
it in the common books of original entry, together with posting, trial balance and financial
statement. It is desirable that he be able to introduce special columns where needed. Some
review in the methods of transferring department statistics to general accounts would also
be in order. These matters can be gathered from the general treatment in this set but its
practical value would be enhanced if the attention is not diverted from the problem actually
in hand,
OBJECT
The objects to be emphasized in this set are (1) an exhibit of the cost of producing each
of the farm products, (2) the returns derived from their sale or use, (3) the general value
and progress of the business. These facts should be placed in such form as to render
convenient comparison from year to year.
THE LEDGER
This book is divided into two parts — the first, for general accounts, including an account
with each department of farm industry considered ; the second, including accounts with notes
and persons. It should be a book large enough and well enough bound to last on an
ordinary farm for a period of ten years. The standard double entry ledger ruling is used,
as the explanation column in it allows room for the memoranda that should accompany prac-
tically all entries.
TRIAL BALANCE BOOK
A continuous trial balance (one with titles to the left and several sets of debit and credit
columns for successive trial balances to the right) is used, in which are recorded the trial
balances taken on opening the books and thereafter on the last date of each month.
JOURNAL
A six-column journal is used for all current entries. This book has special debit and
credit columns for cash receipts and payments, also merchandise cost and returns. (It will
be noted that the Merchandise account represents all finished product in marketable condi-
tion.) The journal also holds the distribution of labor, team use, and product. These items
are summarized monthly and charged or credited through the journal to the departments
affected.
SUMMARY BOOKS
The essential summary books are three in number : One having columns each for every
department requiring manual labor, called the Labor Summary; one having columns for the
departments requiring the use of teams, called Team Use Summary; and one having col-
umns for each division of production having regular output, called Product Summary. Each
of these books has a miscellaneous column for entries of unusual labor service, team service,
or source of product.
The distribution of above essentials is made daily in the summary books. The daily
items are footed monthly and carried to the led^^er accounts afifected as above explained.
The sales summary may be used for original entries like the other summary books, if sales are active
as they would probably be when parde:") truck is sold. Jp such case, sales on account can be posted from the
sales summary without entry in the jourrial, except iii totals at the close of the month.
FARM ACCOUNTING
AUXILIARY BOOKS
In addition to the above summary books, a number of books for reference not necessary
to the accounting scheme may be kept. These are called auxiliary (helping) books, and may
be taken up or discontinued as serves the purpose. Among these may be mentioned registers
of stock pedigree, records of detailed cost and production in any experimental test, sum-
mary of sales for the month showing quantity of each commodity, with prices, etc. Such
books, while valuable for the purposes intended, are independent of the accounting scheme.
DAILY REPORT CARDS
Success in keeping farm books depends on convenience in making the original records.
This is brought about by the use of individual report cards properly ruled and printed to ac-
commodate the required data. Each person working about the place receives a card in the
morning in which he fills during the day the time spent in departments, the team use, the
product passing through his hands, and on the reverse side of the card the business dealings
which he carries out. This card he returns at night together with any cash or other matter
that should accompany it. Entries are made from these cards at the convenience of the book-
keeper who then files them as vouchers.
PRELIMINARY EXERCISE
DETAILED RECORD FOR EXPERIMENTAL PURPOSES
The Poultry Record for experimental purposes is here given. A similar record can
be kept if desired for any specific line of production. A detailed orchard record, a
garden record, a real estate record, etc., would be of value in correcting the uncertainties of
"guessing."
The experimental poultry record here given exhibits in detail five items of cost: (1)
labor, (2) feed,, (3) housing, ground and tools, (4) stock, (5) miscellaneous. It grves three
items of production : (1) eggs, (2) stock, (3) miscellaneous. The columns are lettered A
to H in order to allow a special memorandum to refer to an amount in any column without
requiring the use of more than one line per day. Other facts are recorded as shown by the
column headings. Notice particularly that the total value of the investment is entered at
top and is changed with each day's entries, and at the end of the month, the interest on the
investment can be easily computed and charged in.
OPENING THE RECORD
The inventories at starting should be placed at the head of the columns (red ink) so
that the current entries following (black ink) can be footed separately. The red ink amounts
at top plus the footings for the current month will be added and carried to the top of the next
open folio representing the following month. These in turn will be carried forward month by
month to Dec. 31, the close of the year, when a new register is to be opened for the ensuing
year.
MEMORANDA
The following entries are 'made on the assumption that the labor is worth 25c per hour,
and that money is worth 6 per cent interest annually. Make all daily calculations correct to
the nearest cent.
Dec. 1. Began poultry record today with the following property invested : 120 chick-
ens, 360 lb. @ 10c per lb., entered in column D; Chicken house valued @ $84.50, fencing,
crates, etc., $16.80, bone grinder, $7.50, sprayer, $3.00, in column C; 40 lb. chick feed worth
80 cts., 12 bu. corn @ 50 cts., 7 bu. wheat @ $1.10, in column B; one Poultry Guide Book,
$1.20, unexpired subscription to the Poultry Journal, 40c, in column E.
Enter number of poultry on hand in column provided for. that purpose. Enter the values here shown in
the respective debit columns (red ink). Enter the total in the investment balance column (black ink). In this
exercise, entries are to be made directly into the record from memoranda as given.
FARM ACCOUNTING
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Dec. 17. 1 hr. labor; paid poultry association dues $1; 24 eggs @ 28c.
" 18. >4 hr. labor; 17 eggs @ 28c.
" 19. Ihr. labor; 29 eggs @ 27c. ' ' "
" 20. ^ hr. labor ; bought 100 lb. poultry mash for $1.75 ; 29 eggs @ 27c ; 24
chickens sold, 96 lb. @ 10c.
Dec. 21. y2 hr. labor ; 21 eggs @ 28c.
14 hr. labor ; 21 eggs @ 28c ; sold 25 lb. granulated bone for 75c.
1 hr. labor; bought 100 lb. charcoal for $1.50; 26 eggs @ 28c; sold 10 chick-
10>^ cts.
Bought 1 dry food hopper $1.50 ; 1 hr. labor ; 27 eggs @ 28c.
>4 hr. labor ; 29 eggs @ 28c.
Paid for advertisement in poultry journal $3 ; 1 hr. labor ; 23 eggs (@ 28c.
\y2 hr. labor; bought 100 lb. beef scraps for $3.50; 28 eggs @ 27c.
1 hr. labor; 27 eggs @ 28c.
2 hr. labor; 21 eggs @ 29c.
1 hr. labor ; bought 45 bu. corn @ 48c ; 24 eggs @ 29c.
Before making entries for the last day of the month, foot the Investment Bal-
ances column including the balance carried forward. The total of the daily balances equals
in value the entire amount invested for one day. Find the interest on this at 6 per cent'
(point off 3 places and divide by 6), and charge the interest in the debit miscellaneous col-
umn. Complete the record of this day with entry of 1 hour labor; 29 eggs gathered* @ 30c.
Proof of Work. Foot all columns in red ink. Be careful not to include red ink totals
at top of colunms. The balance at beginning of month plus the sum of debit footings less the
sum of credit footings equals balance at close of month if work is correct.
Loss or Gain. The loss or gain for any period may be found by comparing the last
balance with the value of property on hand. For example, if on taking "an inventory we find
that we have on hand charged in column B $25.85; C $106.22; D $59.56; and E $3, the
" 22.
" 23.
ens, 45 lb. @
Dec. 24.
' 25.
' 26.
' 27.
' 28.
■' 29.
' 30.
' 31.
FARM ACCOUNTING
sum of these, $194.63, will show a net gain for the month if greater than the last balance
or a net loss if less than the last balance.
Continuing Next MontH. Carry the inventory amounts forward (red ink), also num-
ber of fowls and investment balance (black ink) as before.
QUESTIONS
1. How many hours were given to poultry raising during the month ?
2. How would you find the average egg proclution per fowl?
3. How much is now invested in the poultry industry ?
4. What is the value of the entire investment for the month ?
5. What is the total of returns for the month?
6. How would you find the total feed cost for the month? (Ans. By subtracting the
inventory total of feed on hand from the entire total of feed column,)
7. How can the total profit for the month be found? (Ans. By subtracting the last
investment balance from the total present value of all property that has been charged in the
several debit columns.)
8. How should a following month's record be opened?
9. Why is interest included as a charge on the last day of the month ?
10. How can the actual investment in this business on a given date be found?
Farm Set
Jan. 1, 1911. E. A. Atkinson, farmer, decides to keep a full set of books so arranged as
to show the following facts of his farming business :
1. The amount actually invested at any one time in any department.
2. The profit or loss on any department.
3. The outlay necessary for the profitable maintenance of any department.
4. The waste, if any^ that may be eliminated.
5. The amount and kind of his resources and liabilities.
6. The net profit of farming.
OPENING THE BOOKS
Inventory. The first step in preparing to open the books is to take an inventory of all
property and debts. On a farm this inventory should be listed on journal paper with great
care to include everything of value about the place and to give to it a fair valuation. After
the first inventory, subsequent inventories will be found less dif^cult, as the first one will be on
record for comparison. When the inventory is completed, copy it neatly in the journal. The
following are the items :
FARM ACCOUNTING
Inventory of Real Estate and Personal Property of E. A. Atkinson's Farm — S. E. }i. Sec. 7,
Tivp. 83 N., R'7 W., 5 P. M.
RESOURCES
1. 160 Acres Land less Buildings $16000.00
2. Farm House and Improvements, Family use 2700.00
3. Buildings for use of Teams 420.00
4. Buildings for use of Dairy 950.00
5. Buildings for use of Hogs 300.00
6. Buildings for use of Poultry 116.50
7. Buildings for storage, including corn cribs, wheat bin, etc. 250.00
8. Cow, June '. 55.00
9. " Lily 65.00
10. " Cremo 40.00
n. " Crumple 45.00
12. " Blackhawk 35.00
13. " Star 80.00
14. " Dunn 38.00
15. " Watercress 45.00
16. " Spotty 50.00
17. 4 yearlings 80.00
18. 3 two-year-olds 90.00
19. 1 Cream Separator 42.00
20. I Churn and attachments 58.00
21. Horse, Dan 160.00
22. " Caesar 200.00
23. " Kit 125.00
24. " Joe 90.00
25. " Nancy 75.00
26. 1 two-year-old 80.00
27. 1 Gang Plow 45.00
28. 1 Walking Plow . . 14.00
29. 1 Disc Harrow 18.00
30. 2 Corn Cultivators 72.00
31. 1 Farm Wagon 56.00
32. 1 low Wagon 40.00
33. 1 Corn Planter 28.00
34. 1 Manure Spreader 22.50
35 Harness 37 50
36. 30 head Hogs," 4500 lb.," per "cwt .'.'.'.'.' ." '. .*@*$7."o"o'."."^ ! *. '. 315*00
37. 77 Chickens, 272 lb @ .10...... 27.20
38. Chicken Feed carried over 5.10
39. 1896 bu. Corn @ .50 948.00
40. 600' bu. Oats @ .35 210.00
41. 190 bu. Wheat @ .90 171.00
42. 42 tons Timothy @ 8.00 336.00
43. 10 tons Prairie Hay @ 4.00 40.00
44. 16 tons Clover @ 7.50 120.00
45. 300 head Cabbage @ .04 12.00
46. 420 bu. Potatoes @ .45 189.00
47. 200 bu. Turnips @ .25 50.00
48. 480 lb. dressed Pork @ .08 38.40
49. 300 lb. dressed Beef @ .06 18.00
50. 20 Cords Wood @ 5.00 r 100.00
51. 459 Posts @ .18 82.62
. 52. Cash in Bank 129.88
Total $25314.70
10
FARM ACCOUNTING
LIABILITIES
53. Mortgage note favor Monarch Insurance Co., due Jan. 1,
1913, with interest at 5% payable July 1 and Jan. 1
until paid. Part purchase price of land. Next inter-
est payment July 1 $ 7000.00
54. Note due bank Jan. 15 200.00
55. James Goodwin, balance due on acct 49.69
56. A. A. Wells & Co* balance due on acct 178.29
57. W. Cushman, balalice due on acct 5.04
Total ., $ 7433.02
As shown in the model, number the items in the inventory 1 to 57 for convenient refer-
ence later on.
Ledger. The general accounts of the ledger will include Proprietor's Investment, Cash,
Merchandise, Real Estate, Chattels, Dairy, Teams, Hogs, Poultry, Orchard, and Labor.
Other departments as needed will be opened. Give each account one page of ledger
space. The general accounts will occupy pages 1 to 20. The order of their entry is given
under "Opening the Ledger" on the following page.
The personal accounts are to be entered in the personal division of the ledger. Be care-
ful to make full use of the explanatory space. For example, a long time note should have
explanation showing to whom given, the terms of payment, etc., thus making a convenient
reference. When personal accounts are opened, any conditions or explanations of the ac-
count should be recorded at the beginning of the account. Thus, an account opened with an
employee should give a brief memorandum of the terms of his employment, at the top of the
ledger account.
FIRST JOURNAL ENTRY
The inventory which has been spread on the journal in memorandum form should now
be reduced to debit and credit entries. Before considering the titles to be used in detail,
observe that the journal has two special debit and credit columns, which are footed monthly
and posted from the general columns as single items.
In making the opening journal entry, total the items Nos. 1 to 7 of the inventory and
charge Real Estate with their sum. Total items Nos. 8 to 51 and charge Chattels. Charge
Cash (in general column) with No. 52.
Credit Nos. 53 an 54 to Notes Payable. Credit Nos. 55 to 57 to the respective persons
owed. Credit E. A. Atkinson, Proprietor, with the difference between the total debits and
credits entered.
Rule and total the opening entry as shown in the model form.
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SUMMARY
(Other distribution to be written in blank headings as needed)
Ouan F. Pricp
Ouan. F.Price
Ouan. !•• Pri
Ouan. V. Price
Uuan. P Price
Ouan F Pric
.)uan F. Price
U«an. F Price
SUMMARY
(Other distribution to be written in blank headings as needed)
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20 FARM ACCOUNTING
E. P. Johnson's report:
Labor — 3 hr. repairing fence, 2 hr. self and team delivering merchandise, 4 hr. in dairy,
1 hr. self and team in care of orchard.
Product — 27 gal. milk.
Dealings — Sold for cash 1 cord wood for $5.25.
Jonas Overburg's report:
Labor — 6^ hr. self and team delivering merchandise, 1^ hr. in care of poultry, 2 hr.
in care of teams.
Product — 27 eggs gathered.
Dealings — Sold Eagle Hotel, on acct., 12 gal. milk @ 22 cts. Sold milk tickets (12
gal.) for cash $3. Sold W. Cushman, on acct., 1 cord wood for $5.50.
JANUARY 10
E. A. Atkinson's report:
Labor — 6 hr. self and team delivering merchandise, 1 hr. in care of hogs, 2 hr. in care
of teams.
Dealings — Sold for cash 180 bu. corn @ 57 cts. Took for personal use from mer-
chandise included in first inventory 480 lb. dressed pork @ 9 cts, 300 lb. dressed beef @ 6^/^
cts. (Charge E. A. Atkinson, Personal.)
E. P. Johnson's report:
Labor — 8 hr. self and team delivering merchandise, 5 hr. in dairy.
Product — 25 gal, milk.
Dealings — Sold W. Cushman, on acct., 4 cords wood @ $5.50. .
Jonas Overburg's report:
Labor — 5 hr. self and team delivering merchandise, 3 hr. in care of poultry, 2 hr. in
care of teams.
Product — 46 eggs gathered.
Deahngs — Sold A. A. Wells & Co., on acct., 80 bu. turnips @ 30 cts., 16 doz. eggs @
28 cts.
JANUARY 11
E. A. Atkinson's report:
Labor — 7 hr. self and team working in timber, 2 hr. in care of hogs, 3 hr. in care of
teams.
Dealings — Sold W. Cushman, on acct., 3 cords wood @ $5.50, on ground.
E. P. Johnson's report:
Labor — 10 hr. self and team working for A. A. Wells & Co., 1 hr. in care of teams.
(Enter the time on labor card, filling in the memo space, "work for A. A. Wells & Co.")
Dealings — Bought of A. A. Wells & Co., on acct, bill of goods for E. A. Atkinson's
personal use, $29.61. Debit A. A. Wells & Co., 1 day for man and team (man $1.80, team
$3) $4.80.
The journal entry will be "A. A. Wells & Co., Dr. $4.80; Labor Cr. $1.80; Teams Cr. $3." Place check
marks ( V ) in the folio column next to Labor and Teams, to indicate that these credits will not be posted
separately but will appear in the total credits of these titles for the month as posted from the summary books.
Jonas Overburg's report:
Labor — 4 hr. self and team delivering merchandise, 6 hr. in dairy, 3/2 hr. in care of
poultry.
Product — 22 gal. milk, 23 eggs gathered.
Dealings — Sold Eagle Hotel Co., on acct., 12 gal. milk @ 22 cts. Sold milk tickets (20
gal.) for cash $5.
JANUARY 12
E. A. Atkinson's report:
Labor — 4 hr. self and team delivering merchandise, 5 hr. in dairy, yi hr. in care of hogs.
Product — 24 gal. milk.
Dealings — Sold W. Cushman, on acct., 2 cords wood @ $5.50. Sold Goldleaf Cream-
ery Co., on acct., 11 lb. butter fat @ 26 cts. Paid E. P. Johnson Cash on account $20.
E. P. Johnson's report:
Labor — 10 hr. self and team working for A. A. Wells & Co., 1 hr. in care of teams.
Dealings — Debit A. A. Wells & Co. for 1 day for man and team $4.80.
FARM ACCOUNTING 21
Jonas Overburg's report:
Labor — 6 hr. self and team delivering merchandise, 1 hr. in care of poultry, 2 hr. in
care of teams.
Product — 33 eggs collected.
Dealings — Sold 1 cord wood for cash $6. Sold milk tickets (8 gal.) for cash $2.
JANUARY 13
E. A. Atkinson's report:
Labor — 2 hr. in timber, 9 hr. self and 7 hr. team delivering merchandise, ^2 hr. in care
of hogs.
Dealings — Sold W. Cushman, on acct.^ 4 cords wood @ $5.50.
E. P. Johnson's report:
Labor — 6 hr. self and team delivering merchandise, 4 hr. in dairy.
Product — 26 gal. milk.
Dealings — Sold W. Cushman, on acct., 3 cords wood @ $5.50.
Jonas Overburg's report:
Labor — 7 5^ hr. self and team delivering merchandise, ^ hr. in care of poultry, 2 hr.
in care of teams.
Product — 26 eggs gathered.
Dealings — Sold for cash 2 cords wood for $12.25.
JANUARY 14
E. A. Atkinson's report:
Labor — 9 hr. self and team at auction sale, which he distributes as follows : Dairy 3 hr.,
hogs 3 hr., teams 3 hr.
Dealings — Bought for cash 1 cow for $39.50 (Dairy), 1 set harness for $14.25
(Teams), 6 shoats for $31.50 (Hogs), sundry household articles for $3.90 (Atkinson Per-
sonal).
E. P. Johnson's report:
Labor — 4 hr. working in timber, 3 hr. self and team delivering merchandise, 4 hr. ni
dairy.
Product — 27 gal. milk, 5 hogs (farm weight 1605 lb.)
Dealings — Sold for cash 5 hogs weighing 1568 lb. @ $8.40 per cwt. (Credit Mdse.)
Jonas Overburg's report:
Labor — 5^ hr. self and team delivering merchandise, 2^ hr. in care of poultry, 2 hr.
in care of teams.
Product — 34 eggs gathered.
Dealings — Sold for cash 50 bu. corn @ 56 cts. Sold milk tickets (16 gal.) for $4.
Count the week's tickets to see that all are in — 21 in number. Review your journal
entries, to see that all dealings have been recorded. Foot the journal column to see that the
journal is in balance. What is your cash balance?
Post the general accounts from the journal, but do not post the special column accounts
until the close of the month.
Referring to the report cards, extend the amount of each labor item, and make the re-
quired entries in the summary books as you were instructed to do on Jan. 7.
On Jan. 9, place Johnson's labor 1 hr. in orchard in miscellaneous column.
On Jan. 11 and 12 place E. P. Johnson's time for working for Wells & Co. in the miscel-
laneous column followed by the initial "]," indicating that the charge against Well^ & Co. has
already been made through the journal. The two day's use of team is entered in like man-
ner in the team use summary.
Observe that the summary books have one miscellaneous column each for unusual items,
with a memorandum space before the item to show what it is for. The two day's labor, man
and team, for Wells & Co. would be itemized in this column. Remember that the totals of
all labor columns will at the end of the month be posted to the credit of Labor account, and
of all special columns to the debit of the department named at the head of the column with
the exception of the miscellaneous column, the debits of which, if they concern a personal ac-
count, are posted from the journal, as it is frequently desirable to have such items posted on
22 FARM ACCOUNTING
the date of the transaction. If a department is affected, the posting will be done at the end
of the month.
Observe further that the summary books have a number of columns without printed
heads. These columns are to be headed by the bookkeeper at certain seasons of the year
when other departments become active. Thus, wheat crop, oats crop, corn crop, would re-
quire much time during certain months and would not be regarded during other months.
Likewise, the columns Wood and Posts in the product summary will at a later date be dis-
continued. The departments requiring constant entries have printed heads in the summary
books.
You may now foot in pencil the summarv columns, adding in the pencil footings of the
7th.
As an experiment, add the footings of the labor summary and see if the labor actually
reported agrees with one-half of your monthly pay roll of $140. If it runs behind, investi-
gate.
What value have you received from teams to date? Is the output of milk what should
be expected? Is the yield of eggs satisfactory ? Note that Overburg is spending less time
attending to poultry than formerly. Foot in pencil A. A. Wells & Co.'s account, to see how
it stands. Has W. Cushman still a credit balance? How much has E. P. Johnson received?
The Eagle Hotel Co. ordered milk only twice. Why do they not order regularly? Ask
Overburg. Does the Goldleaf Creamery Co. owe us $15.09 or $16.09? They settle by check
monthly. Do we owe any notes due soon ? How much cash is on hand ? A person keep-
ing books should form the habit of looking to his books for information about his business.
JANUARY 15
E. A. Atkinson's report:
Labor — ^ hr. in care of hogs, i^ hr, in care of poultry, Ij/^ hr. in care of teams.
Product — 31 eggs gathered. ■
E. P. Johnson's report:
Labor — 4 hr. in dairy.
Product — 28 gal. milk,
Jonas Overburg' s report:
Labor — 3 hr. self and team delivering merchandise.
JANUARY 16
E. A. Atkinson's report:
Labor — 3 hr. self and team getting wood from timber, 3 hr. self and team delivering
merchandise, 4 hr. in care of hogs.
Product — 2 cords wood. 26 posts.
Dealings — Sold W. Cushman, on acct., 100 posts @ 21 cts. Paid cash in full of the
bank note due yesterday. (No interest.)
E. P. Johnson's report:
Labor — 6 hr. self and team delivering merchandise, 4 hr. in dairy.
Product — 28 gal. milk.
Dealings — Sold for cash 2 tons timothy hay @ $9.
Jonas Overbnrg's report:
Labor — 4 hr. self and team delivering merchandise, ^ hr. in dairy, 2 hr. in care of
teams, 1^ hr. in care of poultry.
Product — 30 eggs gathered.
Dealings — Sold milk tickets (20 gal.) for cash $5.
JANUARY 17
E. A. Atkinson is sick. (Make pencil memo in his ledger account.)
E. P. Johnson's report: '
Labor — 6 hr. self and team 2 hr. and 3 horse team 4 hr. getting wood out from timber.
4 hr. in dairy, 3^ hr. in care of hogs.
Product — 27 gal. milk, 3 cords wood, 28 posts.
Jonas Overbnrg's report:
Labor — 8 hr. self and team delivering merchandise, ^ hr. in care of poultry, 1 hr. in
care of teams.
FARM ACCOUNTING 23
Product — 37 eggs gathered.
Dealings — Sold W. Cushnian, on acct., 100 posts @ 21 cts. Sold milk tickets (8 gal.)
for cash $2.
JANUARY 18
E. P. Johnson's report:
Labor — 4 hr. self and team getting out wood from timber, 2 hr. self and team delivering
merchandise, 4 hr. in dairy, >^ hr. in care of hogs.
Product — 26 gal. milk, ^ cord wood.
Dealings — Sold for cash 2 tons timothy hay for $17.75. Sold to the Goldleaf Creamery
Co., on acct., 16 lb. butter fat @ 25 cts.
Jonas Overburg's report:
Labor — 5 hr. self and team delivering merchandise, 1^/2 hr. in care of poultry, 2 hr. in
care of teams.
Product — 26 eggs gathered.
Dealings — Sold 1 cord wood for cash $5.50. Sold to A. A.. Wells, on acct., 20 doz.
eggs @ 29 cts., milk tickets (12 gal.) for cash $3.
JANUARY 19
E. p. Jolinson's report:
Labor — 6 hr. self and team delivering merchandise, 4 hr. in dairy, ;^ hr. in care of hogs.
Product — 27 gal. milk.
Dealings — Sold 2 tons timothy hay for cash $17.25.
Jonas Overburg's report:
Labor — 6 hr. self and 2 teams delivering merchandise, 3^ hr. in care of poultry, 2 hr.
in care of teams.
Product — 26 eggs gathered.
Dealings — Sold 1^4 tons timothy hay for cash $10. Sold milk tickets (12 gal.) for
cash $3.
JANUARY 20
E. P. Johnson's report:
Labor — 6 hr. repairing fences, 4 hr. in dairy, ^ hr. in care of hogs.
Product — 26 gal. milk.
Dealings— Sold to A. A. Wells & Co., on acct., 2^ tons timothy hay @ $8.50 on the
ground.
Jonas Overburg's report:
Labor — 8j^ hr. self and team delivering merchandise, ^/^ hr. in care of poultry, 2 hr.
in care of teams.
Product — 27 eggs gathered.
Dealings — Sold to James Goodwin, on acct., 100 bu. corn @ 59c. Sold milk tickets (8
gal.) for cash $2.
JANUARY 21
E. P. Johnson's report:
Labor — 4 hr. self and team delivering merchandise, 4 hr. in dairy, J/4 hr. in care of hogs.
Product — 24 gal. milk.
Dealings — Sold 3 tons timothy hay for cash $26. Sold the Goldleaf Creamery Co., on
acct., 26 lb, butter fat @ 26 cts.
Jonas Overburg's report:
Labor — 4 hr. self and team delivering merchandise, 4 hr. in care of poultry, 2 hr. in
care of teams.
Product — 29 eggs gathered.
Dealings — Sold Mrs. Jane Cramer, on acct., milk tickets (4 gal.) $1. Sold milk tickets
(28 gal) for cash $7.
Enter the week's reports as before.
JANUARY 22
E. P. Johnson's report:
Labor — 4^ hr. in dairy.
Product — 25 gal. milk.
24 FARM ACCOUNTING
Jonas Overhurg's report:
Labor — 5 hr. self and team delivering merchandise, 1 hr. in care of hogs, 1^ hr, in
care of poultry, 2 hr. in care of teams.
Product — 27 eggs gathered.
Dealings — Bought of A. Gregory, on acct., 10 gal. milk @ 16 cts. Sold milk tickets
(28 gal.) for cash $7.
JANUARY 23
E. P. Johnson's report:
Labor — 8 hr. self and team delivering merchandise, 4^^ hr. in dairy. .
Product — 25 gal. milk.
Dealings — Sold for cash 2 cords wood for $12.40.
Jonas Overburg's report:
Labor — 5 hr. self and team delivering merchandise, 1 hr. in care of hogs, ^ hr. in care
of poultry, 3 hr. in care of teams, 4 hr. for Mr. Atkinson personally (charge to Atkinson's
personal account through labor summary at close of month.)
Product — 28 eggs gathered.
Dealings — Sold A. A. Wells & Co., on acct., 8 doz. eggs @ 30 cts. Sold milk tickets
(32 gal.) for cash $8. Bought of A. Gregory, on acct. 8 gal. milk @ 16 cts.
JANUARY 24
E. P. Johnson's report:
Labor — 7 hr. self and team delivering merchandise, 5 hr. in dairy.
Product — 26 gal. milk.
Dealings — Sold A. A. Wells & Co., on acct., 62 bu. oats @ 36 cts., 45 bu. potatoes @
49 cts.
Jonas Overhurg's report:
Labor — 3 hr. self and team getting out wood from timber, 5 hr. self and team deliver-
ing merchandise, 1 hr. in care of hogs, ^ hr. in care of poultry, 1^^ hr. in care of teams.
Product — 31 posts, 27 eggs gathered.
Dealings — Bought of A. Gregory, on acct., 12 gal. milk @ 16 cts. Sold Mrs. Jane
Cramer, on acct., milk tickets (4 gal.) $1. Sold Eagle Hotel Co., on acct., 10 gal. milk @
22 cts. Sold milk tickets (20 gal.) for cash $5.
JANUARY 25
E. P. Johnson's report:
Labor-^7 hr. self and team delivering merchandise, 4^^ hr. in dairy.
Product — 25 gal. milk.
Dealings — Sold 1^ tons prairie hay for cash @ $5.25. Sold to A. A. Wells & Co., on
acct., 61 bu. turnips @ 30 cts.
Jonas Overhurg's report:
Labor — 2^ hr. chopping wood in timber, 5 hr. self and team delivering merchandise,
y2 hr, in care of hogs, 1 hr. in care of poultry, 1^ hr. in care of teams.
Product — 23 eggs gathered.
Dealings — Bought of A. Gregory, on acct., 8 gal. milk @ 16 cts. Sold milk tickets
(32 gal) for cash $8.
JANUARY 26
E. P. Johnson's report:
Labor — 6^ hr. self and team delivering merchandise, 5 hr. in dairy.
Product — 26 gal. milk.
Dealings — Sold W. Cushman, on acct., 100 posts @ 21 cts.
Jonas Overhurg's report:
Labor — 4^ hr. self and team delivering merchandise, >^ hr. in care of hogs, 2 hr. in
care of poultry, 1^ hr. in care of teams, 2 hr. work for Mr. Atkinson.
Product — 26 eggs gathered.
Dealings — Bought of A. Gregory, on acct., 10 gal. milk @ 16 cts. Sold Eagle Hotel
Co., on acct., 10 gal. milk @ 22 cts. Sold milk tickets (16 gal.) for cash $4.
JANUARY 27
E. P. Johnson's report:
Labor — 7 hr. self and team delivering merchandise. 4^ hr. in dairy.
FARM ACCOUNTING 25
Product — 26 gal. milk.
Dealings — Sold for cash 87 bu. wheat @ 96 cts. Paid cash for repairs on wagon $3.50.
Jonas Overburg's report:
Labor — 5 hr. self and team delivering merchandise, 1 hr. in care of hogs, 1 hr. in care of
poultry, 1 hr, in care of teams, 2 hr. work for Mr. Atkinson.
Product — 29 eggs gathered.
Dealings — Sold Goldleaf Creamery Co., on acct., 15 lb. butter fat @ 26 cts.
JANUARY 28
E. P. Johnson's report:
Labor — 7 hr. self and team delivering merchandise, 4^ hr. in dairy.
Product — 25 gal. milk.
Dealings — Sold for cash 98 bu. corn @ 57 cts. Paid Dr. Burrows cash $25 for Mr.
Atkinson's account.
Jonas Overhurg's report:
Labor — 6 hr. self and team delivering merchandise, ^ hr. in care of hogs, ly^ hr. in
care of poultry, 1^ hr. in care of teams, 1 hr. work for Mr. Atkinson.
Product — 24 eggs gathered.
Dealings — Sold milk tickets (16 gal.) for cash $4.
Enter the week's report as before. Note that the charges for labor for E. A. Atkin-
son, personal, may be made through the summary book, as there is no haste in posting this
account. Write his name at top of the next unused column in summary book and carry
charges as in other columns.
The work for the three remaining days of the month will now be taken up, after which
the month's summaries will be journalized and posted, and a trial balance will be taken.
Note that Johnson and Overburg carry out some unusual transactions which the student
should take time to enter correctly.
JANUARY 29
E. P. Johnson's report:
Labor — 5 hr. in dairy.
Product — 26 gal. milk.
Jonas Overburg' s report:
Labor — 5 hr. self and team delivering merchandise, 1 hr. in care of hogs, 1^^ hr. in
care of poultry, 2 hr. in care of teams.
Product — 19 eggs gathered.
JANUARY 30
E. P. Johnson's report:
Labor — 7 hr. self and team delivering merchandise, 4^ hr. in dairy, 1 hr. work for Mr.
Atkinson.
Product — 24 gallons milk.
Dealings — Sold for cash 2 cords wood for $12.75, kept out cash $5 on account, paid
from cash collected for wood $2 to drug store for items for Mr. Atkinson.
Jonas Overburg' s report:
Labor — 6 hr. self and team and 2 hr. use of one extra horse in delivering merchandise,
1 hr. in care of hogs, 1 hr. in care of poultry, 2 hr. in care of teams.
Product — 18 eggs gathered.
Dealings — Sold milk tickets (16 gal.) for cash $4. Sold Eagle Hotel Co., on acct., 12
gal. Milk @ 22 cts. Sold E. A. Atkinson, on acct., milk tickets (16 gal.) @ 16 cts per gal.
In reporting cash with his ticket, Overburg could produce only $2.95; charge him with the
shortage.
JANUARY 31
E. P. Johnson's report:
Labor — 5 hr. self and team delivering merchandise, 4^ hr. in dairy.
Product — 23 gal. milk.
Dealings — Took 20 bu. wheat to mill (estimated at market price, 96 cts. per bu.) and
brought back 227 lb. bran and shorts (charge to Merchandise at $1.20 per cwt.) and 455 lb.
flour (charge to E. A. Atkinson, personal, for the diflference between the market value of the
26
FARM ACCOUNTING
wheat and the value of the feed taken out. ) Bought of A. A. Wehs & Co. on Atkinson's
account 1 pair of gloves at 80 cts., for Johnson's personal use.
Jonas Overhiirg's report:
Labor — 5 hr. self and team delivering merchandise, ^^ hr. in care of hogs, 1 hr. in care
of poultry, 2 hr. in care of teams, 1^ hr. work for Mr. Atkinson.
Product — 22 eggs gathered.
Dealings — Sold Mrs. Jane Cramer, on acct., milk tickets (4 gal.) $1. Sold milk tickets
(32 gal. @ 25 cts.) for cash and reports cash $6.75. Sold Goldleaf Creamery Co., on acct.,
18 lb. butter fat @ 27 cts.
Enter last three days, which close the month, on the same plan as the preceding weekly
reports.
CLOSING THE MONTH
Cash: Mr. Atkinson, who is assumed to have charge of the cash, finds that the stub of
his bank check book shows that his cash balance in the bank is $495.67 and he has cash in
pocket $61.19, making total cash $ The cash carried over from last month (see
trial balance book), plus the debit cash footing of the current month, less the credit cash
footing equals $ showing the actual cash on hand short $ Charge the
shortage to E. A. Atkinson's personal account and credit cash.
Products: From the products summary compute the totals of the different columns at
farm prices : Milk at 16 cts. per gal. Eggs at 26 cts. per doz.. Wood at $5 per cord. Posts
at 18 cts. each. Hogs at $7.55 per cwt. Charge their total to Mdse. (general column) and
credit the respective accounts affected; i. e.. Real Estate, Dairy, Hogs, and Poultry. (In
charging and crediting departments from the summaries, enter the titles in the order of the
ledger accounts for convenience in posting. See model.)
Feed: E. P. Johnson turns in feed ticket for the month which reads as follows :
Business Dealings
/a O^- '^^y^^
^^A^t^ 'S-i?--L^y
^^^-^^-^£_^
K^_% ^^Z^-^gu/^-^^-z^^-^-^"^^?^^^^?^.
-l^^i.^..(U^ J'J
A
IjL
Estimate the feed used at inventory prices.
Overburg turns in a feed ticket as follows :
Feed for horses for month: Timothy hay 3100 lbs., Prairie hay ^ ton, corn 25 bu.,
oats 35 bu. Sundries from mdse. $3.
Feed of Poultry charged with inventory No. 38 in full.
Mr. Atkinson makes out the following ticket :
Feed of Chattels for month: Prairie hay V/\ tons. Clover Yz ton. Corn 20 bu., Oats
10 bu. Feed of hogs for month : Corn 65 bu., Oats 30 bu., skim milk 330 gal. at 5 cts.
Journalize as in model.
Labor Charge: Atkinson also makes a ticket crediting E. A. Atkinson 5^ month
wages, Johnson full month and Jonas Overburg full month at the prices agreed upon which
are (or should be) noted in their ledger accounts. On the same ticket he enters a memo,
"Labor acct. Dr. to E. A. Atkinson, Personal, board Johnson and Overburg 1 month $30."
Labor Distribution: Foot the labor summary and charge each department according
to headings crediting Labor with entire amount as in model.
FARM ACCOUNTING
27
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J'c
^ /J
2
I
Z
/
i
Z
2
Z
X^4^-^€^^^^>^>z<>->^-<:e^^<:^:.^
^^^a-J-t^^ty
f^jb^^^^J-t^^^H-n/i
fh^-C^.--i-^nUt^y, ., (^^6«.,C^^Qltn^'/l' /^
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Note the IVIiscellaneous column which has a charge to Orchard 18 cts., two items
amounting to $3.60 which charge to '']o\xx\\2X'' (because previously credited in journal with-
out posting). Credit the total to Labor.
Team Use Distribution: Foot the team use summary and charge each department ac-
cording to headings crediting Teams with the total as in summary. Items in the miscellane-
ous column should be journalized. See model.
Closing the Journal: Carry the special columns (Merchandise and Cash) into the gen-
eral columns and foot the general columns to show in balance.
Post the ledger. Pencil-foot the ledger, and take a trial balance, recording it in the pair
of columns following the one recorded Jan. 1.
SALES SUMMARY (AUXILIARY)
For purposes of comparison, turn to the sales summary and write in the headings, if
they are not already printed, the names of the following products which constitute the prin-
cipal sales of the month : Corn, Oats, Wheat, Timothy, Milk, Butter, Wood, Posts, Eggs,
Potatoes, and Miscellaneous.' From the cards enter the quantity and selling amount of each
item, and foot in pencil or red ink. This will give an exhibit of the direction of sales during
the month and will afford a valuable reference for next January. Also the products on hand
28 FARM ACCOUNTING
can be found by adding to inventory Jan. 1, the amount produced and subtracting the
amount sold thus : Inventory Jan. 1, 20 cords wood plus January product IT^^ cords, less
January sales 29 cords, equals 8^4 cords that should be on hand.
With your ledger before you, answer the following questions :
1. Cash account — How much cash was received during the month? How much paid?
2. Merchandise account— What was the cost of delivering the products sold during
the month ? What was the farm value of the month's production ? How much of the farm
production was used again for feed? How much was sold?
3. Real Estate account — What was the value of labor and team use put into real
estate during the month ? What was the salable product ? Is this account likely to be as
active as here shown during the remainder of the year. What is the 6% rental value of the
real property devoted to department uses? Is all real property now used in departments?
What part is not?
4. Chattels account — How much money is now invested in unclassified animals or
other personal property ?
5. Dairy account — Is there a, profit or loss shown in dairy during the month ? How
many cows are there? \\'hat was the value of the labor on dairy for January? Of feed?
Is the product computed at farm price or market price ? Why ?
6. Teams account — What was the cost of care and feed during the month? What did
their use amount to at 20 cents per hour?
7. Orchard account — Was any investment made in orchard during the month ? How
much ?
8. Hogs account — How much labor and feed were expended on hogs during month?
9. Poultry account — Does the ledger show a profit in the poultry department?
10. Labor account — Was the time actually reported in labor greater than expected ?
How much ? If expectations were exactly met, this account would balance out without gain
or loss.
11. Among the financial accounts, how do we stand with Wells & Co. ? How much has
Mr. Atkinson been charged with during the month ? Some accounts should be collected and
some accounts should be paid. Name them.
FEBRUARY
Remark. — The card system of records has been demonstrated in the January business. To avoid tire-
some repetition, the cards and summary books need not be written in the following work, which has been
expanded to cover one year's time in order to illustrate the farm turnover. The value of the cards in checking
up time and keeping every one busy, as well as providing vouchers for all charges and entries, has been well
demonstrated in factories in general and should not be neglected on the farm. The following memoranda which
include monthly summaries is to be cn'.ered in the journal direct. It is assumed that the report cards have
been used, although they are not to be prepared by the student.
Feb. 1. E. A. Atkinson returns to work. (Ledger memo.) Egg product of January
in excess of sales should be charged to E. A. Atkinson, personal, @ 24 cts. per dozen. (Make
journal entry.)
Received from Goldleaf Creamery Cp. check to balance account. (Journal entry.)
Collected cash of the Eagle Hotel Co. in full of account.
Paid A. Gregory our check to balance account.
Paid E. P. Johnson our check on account $15.
Paid Jonas Overburg our check to balance January wage credit.
Daily reports are assumed to have been rendered by Atkinson, Johnson, and Overburg,
giving the labor and product matter in addition to above transactions. Consider these tick-
ets entered in Labor, Team Use, and Product Summaries.
Post and rule up accounts that are in balance.
Feb. 2. Bought of W. Cushman, on acct., a bill of lumber, brick, etc., for general
repairs on buddings and fences $49.16. (Charge Real Estate.) Sold milk tickets (12 gal.)
for cash $3.
Feb. 3. Sold W. Cushman,- on acct., 50 posts @ 21 cts. Sold for cash 2 cords wood
@ $5.75.
Feb. 4. Sold Goldleaf Creamery Co., on acct., 16 lb. butter fat @ 26 cts. Sold milk
tickets (16 gal.) for cash $4.
FARM ACCOUNTING 29
Feb. 6. Jonas Overbitrg takes a vacation withont pay awaiting the opening of spring
work. Gave him check for j/^ month's wages i:i full. Sold A. A. Wells & Co., on acct., 5
doz. eggs @ 26 cts. Sold milk tickets (8 gal.) for cash $2.
Feb. 7. Bought for cash 17 hd. shoats for $102.
Feb. 8. Sold Eagle Hotel Co., on acct., 17 chickens, 81 lb. @ 11^ cts. Sold for
cash 4 cd. wood @ $5.50.
Feb. 9. Sold A. A. Well§ & Co., on acct., 80 bu. potatoes @ 55 cts. Bought of A. A.
Wells & Co. sundry items of stock food per bill $9.60. (Charge Mdse.) Sold milk tickets
(16 gal.) for cash $1.
Feb. 10. Paid cash $27 for $3000 insurance on buildings, running five years. (Charge
Real Estate.) Sold milk tickets (20 gal.) for cash $5.
Feb. 11. Sokl Goldleaf Creamery Co., on acct., 40 lb. butter fat @ 26 cts. Sold for cash
2 cd. wood @ $5.25. Bought bill of furniture for E. A. Atkinson, personal, paying for
same by check, $16.27.
Paid Dr. C. W^illiams by check, for veterinary surgical attendance on work horse $9.50.
Sold milk .tickets (20 gal.) for cash $5. Bought for cash 2000 lb. mill feed for $20.
Feb. 13. Bought a work horse, "Jim" for $120, trading in exchange the horse "Joe"
and paying check for the difiference $40. Soil milk tickets (60 gal.) for cash $15.
Feb. 14. Bought of A. A. Wells & Co., on acct., a bill of goods for E. A. Atkinson's
personal use $40.69. Sold A. A. Wells & Co., on acct., 15 doz. eggs @ 25 cts. Sold Gold-
leaf Creamery Co., on acct., 40 lb. butter fat @ 24 cts.
Feb. 15. Bought for E. P. Johnson's personal use, sundry items $3.96, paid by check.
Feb. 16. Sold Eagle Hotel Co., 12 gal. milk @ 22 cts., on acct.
Feb. 17. Sold for cash 3 hogs, 800 lb., @ $7.50. Bought of A. Gregory, on acct., 15
gal. milk @ 16 cts.
Feb. 20. Boarded Herbert Jones, a nursery agent, 4 weeks for $15, on acct. Jones is
to make payment in fruit trees later on. Sold milk tickets (68 gal.) for cash $17.
Feb. 25. Sold Goldleaf Creamery Co., on acct., 35 lb. butter fat @ 24 cts. Sold A. A.
Wells & Co.. on account, 12 doz. eggs @ 25 cts.
Feb. 27. Sold milk tickets (208 gal.) for cash $52. Received of Mrs. Jane Cramer
cash on acct. $2.
Feb. 28. Sold for cash 4 tons timothy hay @ $8.50. Sold Goldleaf Creamery Co., on
acct., 20 lb. butter fat @ 24 cts. Charge E. A. Atkinson, Personal, with 18 doz. eggs @
25 cts.
SUMMARIES FEBRUARY 28
The summary tickets and books (assumed to have been kept as in January) give the fol-
lowing totals :
Products: Milk 764 gal. @ 16 cts.. Eggs 629 @ 25 cts. per doz., Wood 22 cords @
$1.50, Posts 160 @ 18 cts.. Hogs 800 lb. @ $7.30, Chickens 81 lb. @ 11 cts. (Charge Mdse.
and credit departments. )
Chattels Feed: 1 ton prairie hay @ $4, ^ ton clover @ $7.50, 15 bu. corn @ 50 cts.,
10 bu. oats @ 35 cts.
Dairy Feed: 2100 lb. mill feed @ $1.05 per cwt., 24 bu. oats @ 35 cts., 20 bu. corn
@ 50 cts.", 3 ton clover @ $7.50, sundry feed $2.30.
Team Feed: Timothy 2500 lb. @ $8 per ton, 1 ton prairie hay @ $4, 22 bu. corn (ql
50 cts., 20 bu. oats @ 35 cts., sundries $2.50.
Hog Feed: 60 bu. corn @ 50 cts., 30 bu.oats @ 35 cts., 20 bu. potatoes @ 30 cts.,
319 gal. skim milk @ 5 cts.
Poultry Feed: 3 bu. corn @ 50 cts., 3 bu. oats @ 35 cts., 12 hd. cabbage @ 5 cts., 1
bu. potatoes @ 30 cts.
Labor Charge: Wages Atkinson 1 mo. $60; Johnson 1 mo. $30; Overburg y^ mo.
$3.33. Board Johnson $15, Overburg $3.
Labor Diitribution: Mdse. $24.50, Real Estate $20.70, Dairy $33.80, Teams $15.68,
Hogs $8.94, Poultry $5.22.
Team Use Distribution: Mdse. $42.30, Real Estate $12.60.
Journalize, post, and take a trial balance.
30 • FARM ACCOUNTING
MARCH
Mar. 1. The division of farm land for the year follows : Charge the titles given with
the rental at 6% on valuation of $100 per acre and any other debits noted below :
Small Fruit, rental on 1 acre $6 and shrubbery worth $30 ; Garden, 2 acres ; Potato Crop
5 acres ; 2nd year Timothy Crop, 10 acres, 1st year Clover, 11 acres; Corn Crop, 40 acres;
Oats Crop, 40 acres ; Wheat Crop, 15 acres.
Note that 1 acre home ground and 1 acre orchard have already been charged. The 34
acres remaining consist of woodland and pasture and will not be taken out of the Real Estate
account.
Enter the above eight appropriations in the journal crediting Real Estate with tlie total
and post to the ledger in the order namail, pages 11 to 18.
Note. — Small sales of butter, eggs, poviltry and the like, which will occur at intervals in the future, will
be entered in the sales summary sheets first and totaled from the summary to the journal monthly. See
note on Sales Summary, page 5.
Mar. 2. Sold to the Sindlinger Dairy Company the six cows numbered in the inven-
tory 9, 11, 12, 13, 14, and 15, for $290, together with the good will of the milk route which is
estimated to be worth the unused milk tickets in customers' hands.
Received checks from Goldleaf Creamery Co. and Eagle Hotel Co. to balance their ac-
counts. Paid A. Gregory check to balance account.
Mar. 3. Sold Jonas Overburg, on account, 160 posts @ 20 cts. (farm price). Sold to
W. Cushman, on account, 10 cords wood @ $5.
Mar. 11. Sold for cash 6 hogs, 1300 lb. @ $7.
Mar. 18, There is on hand on this date among other items, the following merchandise :
1153 bu. corn, 346 bu. oats, 9 tons clover, 14 tons timothy, 9 cords wood, 88 posts, 255 bu.-
potatoes, 59 bu. turnips.
From estimates, it appears that there will be needed to carry through the season 600
bu. corn, all oats on hand, 5 tons clover hay, all timothy, 50 bu. potatoes.
Sold all clover hay in excess of requirements for cash at $7.90 per ton.
Mar. 20. Sold W. Cushman, on acct., all wood at $5.50 per cord and all posts on hand
at 21 cts. each.
Mar. 22. Sold all potatoes in excess of requirements to A. A. Wells & Co. on account
@ 57 cts. per bu.
Sold all corn in excess of requirements for cash .@ 53 cts. per bu.
Mar. 29. Sold all turnips on hand to A. A. W^ells & Co., on acct., @ 40 cts.
Mar. 30. Paid cash for invoice of seed $67.90. (Charge Mdse.)
Mar. 31. Sold for cash, during the month, per sales summary, dairy products $44.60,
and poultry products $7.
There was used for seed 20 bu. wheat @ $1.50, 120 bu. oats @ 40 cts., and 2^ bu.
clover @ $8. (Charge departments and credit Mdse. in general column.)
During the month 62 posts were used at farm price, 18 cts. each, for repairs of fences.
•( Charge Real Estate. ) *
Paid taxes on Real Estate $109.27 ; and on personal property $25.08, divided as follows :
Merchandise $13.11, Chattels, $1.22, Dairy $2.80, Teams $6.27, Hogs $1.68.
The appreciable manure distribution for the winter season is as follows : Barn yard
manure 63 tons @ $2 (credit Dairy) ; stable manure 42 tons @ $2.20 (credit Teams) ; hog
manure 58 tons @ $2.25 (credit Hogs) ; Poultry manure 3 tons @ $4.50 (credit Poultry).
Charge all farm manure to Real Estate.
Remark. — The student is now in position to note_ the three distinct interests of which the farmer must
keep account if he properly analyzes his farm organization.
(1) The land interest, or the investment in the real estate, necessary to carry on the farm processes.
Investment in land is reasonably free from ordinary business risk. If it produces the equivalent of prevailing
interest rates on safe investments, the results are satisfactory. This return consists of the credits from the
rental charged to crops (or to tenants if rented to others), and from the miscellaneous returns from unclassified
portions of the real estate illustrated by wood and pasturage. These credits are diminished by the cost of
maintenance including repairs, insurance, taxes, common fertilizer, etc.
(2) The manufacturing interest, which involves the outlays including rental of the land and the returns
from producing farm merchandise.
(3) The trading interest, involving the disposition of the merchandise either by selling it or turning it
again into production. The attendant expenses of storage, preparation for sale, and delivery are placed against
the profit of market prices when sold over farm prices when produced.
A scheme of accounting to be a reliable guide must separate these three interests, and consider the cost
and profits of each as apart from the others.
FARM ACCOUNTING 31
SUMMARIES MARCH 31
Products: 340 gal. milk @ 16 cts.^ 507 eggs @ 20 cts. per doz., 6 hogs, 1320 lb. @
$6.90.
Chattels Feed: 1 ton prairie hay @ $4, yi ton clover @ $7.50, 15 bii. corn @ 50 cts.,
10 bu. oats @ 35 cts.
Dairy Feed: 800 lb. mill feed @ $1.05, 10 bu. oats @ 35 cts., 12 bu. corn @ 50 cts.,
1^ ton clover @ $7.50, sundry feed @ $1.50.
Team Feed: 1 ton timothy @ $8, ^ ton prairie @ $4, 24 bu. corn @ 50 cts., 30 bu.
oats @ 35 cts., sundry feed $1.50.
Hog Feed: 30 bu. corn @ 50 cts., 20 bu. oats @ 35 cts., 310 gal. skim milk @ 5 cts.,
10 bu. potatoes @ 30 cts.
Poultry Feed: 3 bu. corn @ 50 cts., 3 bu. oats @ 35 cts., 12 hd. cabbage @ 5 cts., 2
bu. potatoes @ 30 cts.
Labor Charge: E. A. Atkinson, personal, wages $60, board of help $15; E. P. Johnson
wages $30.
Labor Distribution: Mdse. $16.60, Real Estate $22.20, Dairy $12.10, Teams $16.80,
Hogs $7.81, Poultry $5.69, Clover Crop $4, Oats Crop $29.50, Wheat Crop $6.50.
Team Use Distribution: Mdse. $17.80, Real Estate $33.49, 1st year Clover Crop $7,
Oats Crop $42.80, Wheat Crop $8.40.
Journalize, post and take trial balance.
QUESTIONS
1. How much is the cash balance?
2. What is the value of feed used in March ?•
, 3. Name five items other than labor or team use that have been charged to Real Estate
account.
4. Is the tendency of Real Estate account toward an exhibit of 5% profit at the end of
the year ?
5. How does the product of dairy for March compare with that for February?
6. Why are field crops charged with ground rent ?
7. What three distinct interests are involved in owning and operating a farm?
8. Why are the gains from the use of Real Estate placed at a moderate figure ?
9. What accounts are used to represent the operations in farm production ?
10. How is the Merchandise account used?
APRIL
Apr. 1. Jonas Overburg returns to work. He is to receive $25 per month and board
from this date. (Ledger memo.)
Bought for cash a bill of special fertilizer for garden $31.70. (Special fertilizer should
be charged to the department to which it is applied.)
SUMMARIES APRIL 30
Merchandise Sales: Dairy and poultry products have been sold to E. A. Atkinson, per-
sonal, on acct., $8.70; for cash $22.40. (Credit Mdse.)
Remark. — The student will note that through the spring and summer season the sales will be numerous
but small, as it is planned to deliver dairy and poultry products, garden truck and small fruit. Hence it is more
convenient to enter the detailed description of sales in the sales summary book, rather than the journal. A
report of totals is journalized at the end of the month when cash receipts are entered as one item.
Products: Dairy $32.40, Poultry $9.89.
Seed: Used for Garden amounting to $7.30, for Potato Crop 85 bu. potatoes @ 80
cts, for Corn Crop QV2 bu. corn @ $1. (Credit Mdse.)
Feed: Chattels $15.80, Dairy $24.50, Teams $39.18, Hogs $56.80, Poultry $3.90.
(Credit Mdse.)
Labor Charge: E. A. Atkinson wages $60 and board of hands $30, E. P. Johnson
wages $30, Jonas Overburg wages $25.
Labor Distribution: Mdse. $4.80, Real Estate $8.32, Chattels $1.30, Dairv $13.50,
Teams $15.60, Hogs $8.10, Poultry $2.30, Orchard $3. Small Fruit $6.20, Garden $19,
Potato Crop $8, Corn Crop $33.40.
32 FARM ACCOUNTING
Team Use: Mdse. $6.20, Orchard $1, Small Fruit $2, Garden $3.50, Potato Crop
$5.50, Corn Crop $61.20.
Journalize, post and take trial balance.
Questions from Trial Balance. What is indicated by the fact that Poultry balance has
passed from the debit to the credit side? What is indicated by the Labor balance? How
much has been invested in each of the general crops ? Why is the Merchandise balance re-
duced to so small an amount ?
MAY
Reminder. — The headings in the summary books should be filled in by the bookkeeper to suit the titles
to which distribution is made in a given month. For example, during May, sales will be made of dairy,
poultry, and garden stuff. These should be represented by suitable columns in the sales summary. It is
impossible to print headings in these books to suit all accounts on all farms or on the same farm at dififerent
seasons of the year. As these matters were fully explained in the January work, the student will not be re-
quired to repeat the process here.
May 1. Herbert Jones delivered for credit on his account small fruit stock amounting to
$9.80 and special fertilizer for small fruit $10, orchard $5.20. (Charge departments.)
May 2. Paid cash for telephone service $12, for record books and stationery $2.50, for
subscription to farm paper $2, for repair outfit $9.20, for lubricator $3. (Charge General Ex-
pense. Open an account with General Expense and Interest on page 20. )
General Expense and Interest are usually given separate ledger titles in a mercantile business where
these accounts are likely to be active. In the present business the transactions involving these titles will seldom
occur, and for convenience in ledger and trial balance the titles will be combined.
SUMMARIES MAY 31
Merchandise Sales: For cash $42.60, E. A. Atkinson's acct., $13.75.
Products: Dairy $29.40, Poultry $8.39, Garden Truck $16.20.
Seed Used: Garden $2.35, Corn Crop $2.10.
Feed: Chattels $15.80, Dairy $24.50, Teams $39.18, Hogs $56.80, Poultry $3.90. (Of
this amount $18 is for pasturage to be credited to Real Estate. The remainder credits to
Merchandise.)
Labor Charge: E. A. Atkinson wages $60 and board of help $30, E. P. Johnson wages
$30, Jonas Overburg wages $25.
Labor Distribution: Mdse. $1.35, Real Estate $12.89, Chattels $2.50, Dairy $10.50,
Teams $16.30, Hogs $9.95, Poultry $2.15, Orchard $2.50, Small Fruit $7.58, Garden $9.55,
Potato Crop $8.30, Corn Crop $22.50.
Team Use Distribution: Mdse. $2.10, Real Estate $4.40, Orchard $2, Small Fruit $4,
Garden Truck $4.50, Potato Crop $5.50, Corn Crop $32.80.
Journalize, post and take trial balance.
JUNE
June 1. Jonas Overburg discontinued work yesterday evening. He will call to settle
his account later.
June 5. Bought of A. A. Wells & Co., on account, for E. A. Atkinson, personal, mer-
chandise per bill $69.89.
SUMMARIES JUNE 30
Merchandise Sales: Hogs, dairy, poultry, small fruit and garden produce, as per sales
summary, $379.32 for cash with exception of $28.90 to E. A. Atkinson, on personal acct.
Products: Dairy $24.90, 20 Hogs 4725 lb. $283.50, Poultry $10.60, Small Fruit
$8.38, Garden $46.93.
Feed: Chattels $6.95, Dairy $20.19, Teams $36.20, Hogs $49.15, Poultry $2.29.
(Credit all to Mdse. except pasture of 22 animals at $1 each to be credited to Real Estate.)
Labor Charge: E. A. Atkinson wages $60 and board of help $15, E. P. Johnson wages
$30, cash paid for work in garden $30.
Labor Distribution: Mdse. $10.30, Real Estate $4.60, Chattels $2.54, Dairy $9.57,
Teams $18.68, Hogs $6.40, Poultry $2, Orchard $2, Small Fruit $4.40, Garden $38.71,
Potato Crop $7.50, Corn Crop $21.60.
Team Use Distribution: Mdse. $15.26, Orchard $4, Small Fruit $1.40, Garden $6.50,
Potato Crop $3, Corn Crop $28.76.
Journalize, post and take trial balance.
FARM ACCaUNTING 33
JULY
July 1. Paid the semi-annual interest $175 on farm loan. (Charge Interest and post
same to the account with General Expense and Interest.)
Gave Jonas Overburg a check to balance account.
Received cash from Mrs. Jane Cramer in full of account.
Received cash from W. Cushman in full of account.
SUMMARIES JULY 31
Merchandise Sales: Milk, butter, eggs, fruit and garden truck have been sold for
$239.80, from which cash was received for all except $21.70 on E. A. Atkinson's account.
• Products: Dairy $20.16, Poultry $4.20, Orchard $1.40, Small. Fruit $19.82, Garden
$174.38, Timothy 18 tons @ 6, Clover 11 tons @ $6.
Feed: Chattels $17.83, Dairy $16.56, Teams $31.50, Hogs $26.50, Poultry $2.15.
(Credit Mdse. with all except $22 pasturage.)
Labor Charge: E. A. Atkinson wages $50, board help $15, E. P. Johnson wages $30,
sundry cash payments $28.50.
Labor Distribution: Mdse. $16.80, Real Estate $1.25, Chattels $3.20, Dairv $10.24,
Teams $15.20, Hogs $7.25. Poultry $3.20, Orchard $3.60, Small Fruit $6.30^ Garden
$34.20, Potato Crop $8, Timothy Crop $10.70, Clover Crop $9.44, Corn Crop $6.20.
Team Use Distribution: Mdse. $24.60, Garden $4, Potato Crop $6, Timothy Crop
$8.90, Clover Crop $6.66, Corn Crop $9.45.
Journalize, post and take trial balance.
AUGUST
Aug. 10. Bought of A. A. Wells & Co., on acct., 260 lb. binding twine @ 10 cts. per
lb., (200 lb. for oats crop and 60 lb. for wheat crop. Make entry charging the two accounts
named.)
SUMMARIES AUGUST 31
Merchandise Sales: For cash $179.97, acct. E. A. Atkinson $30.69.
Products: Dairy $27.60, Poultry $3.70, Orchard $6.75, Small Fruit $49.60, Garden
Truck, $105.29, 2400 bu. oats @ 30 cts. and 40 tons oat straw at $1 per ton, to be left
on the ground for roughage and manure, 300 bu. wdieat @ 90 cts. and 15 tons wheat straw
at 75 cts. per ton, left on the ground as above. (Charge straw to Real Estate.)
Feed: Chattels $21.28, Dairy $15.80, Teams $26.59, Hogs $27.31, Poultry $2.10.
(Pasture $26, remainder Mdse.)
Labor Charge: E. A. Atkinson wages $60, board Johnson, threshing crew and other
help $34.50, E. P. Johnson wages $30. Paid sundry help cash $8.50 and threshing bill
$41.40.
Labor Distribution: .Mdse. $14.29, Chattels $3.88. Dairy $11.50, Hogs $6.84, Poultry
$1.48, Teams $17.39, Orchard $1.25, Small Fruit $12.80, Garden $21.48, Oats Crop (har-
vesting, threshing and storing) $66, Wheat Crop (harvesting, threshing and storing) $17.45.
Team Use Distribution: Mdse. $19.38, Garden $3.50. Oats Crop (harvesting, thresh-
ing and storing) $31, Wheat Crop (harvesting, threshing and storing) $10.70.
Journalize, post and take trial balance.
SUMMARIES SEPTEMBER 30
Merchandise Sales: This includes 6 hogs, 200 bu. potatoes, garden truck, dairy and
poultry products $378.60 for cash with exception of $26.40 to E. A. Atkinson on account.
Products: Dairv $34.60, 6 Hogs 1100 lb. $71.50. Poultry $5.90, Orchard $1.90, Gar-
den Truck $209.10. 1500 bu. Potatoes @ 35 cts.
Feed: Chattels $21.28, Dairy $15.80, Teams $26.59, Hogs $27.31. Poultry $2.10.
(Mdse. except $26 pasturage and roughage.)
Labor Charge: E. A. Atkinson wages $50. and board of help $23.40; E. P. Johnson
wages $30 ; cash for sundry help $18.60.
Labor Distribution: Chattels $4.69, Mdse. $14.30. Dairy $9.50, Teams $18.50, Hogs
$7.32, Poultry $1.48, Orchard $4.20, Garden $10.70, Potato Crop $61.80.
34 FARM ACCOUNTING
Team Use Distribution: Mdse. $21.60, Garden $1.50, Potato Crop $31.
Journalize, post and take trial balance.
SUMMARIES OCTOBER 31
Merchandise Sales: $228.90 (cash $168.50, E. A. Atkinson's acct., the remainder.)
Products: Dairy $35.30, Poultry $10.49, Garden Truck $16.20, 600 bu. corn @ 40
cts.
Feed: Chattels $20.66, Dairy $19.44, Teams $32.58, Hogs $23.51, Poultry $4.20,
(Mdse. except $21 pasturage and roughage.)
Labor Charge: E. A. Atkinson wages ^^ month $40 and bogird help $15, E. P. John-
son wages $30. •
Labor Distribution: Mdse. $12.50, Real Estate $14.30, Chattels $5^20, Dairy $10.20.
Teams $12.50, Hogs $8.31, Poultry $3.25, Orchard $36 cts., Coyn Crop'$18.
Team Use Distribution: Mdse. $16.60, Corn Crop $20. '
Journalize, post and take trial balance. ' ,
SUMMARIES NOVEMBER 30
Merchandise Sales: $181.60 (cash $157.90, E. A. Atkinson's acct. charged with re-
mainder.)
Products: Dairy $36.70, Poultry $13.70, 1600 bu. corn @ 40 cts., and 40 acres stalks
@ 75 cts. left on ground.
Feed: Chattels $20.81, Dairy $20.19, Teams $37.27, Hogs $25.60, Poultry $4.20.
(All Mdse. except $16 roughage.)
Labor Charge: E. A. Atkinson wages $60, board help $15; E. P. Johnson wages $30.
Labor Distribution: Mdse. $8, Chattels, $6.25, Dairy $12.30, Teams $12.80, Hogs
$9.15, Poultry $6.21, Corn Crop $48.
Team Use Distribution: Mdse. $10.20, Corn Crop $53.30.
Journalize, post and take trial balance.
DECEMBER
Dec. 30. Paid the semi-annual interest on loan due Jan. 1.
SUMMARIES DECEMBER 31
Merchandise Sales: $78.10 (cash $52.20, E. A. Atkinson remainder.,)
Products: Dairy $38.30, Poultry $18.40.
Feed: Chattels $21.60, Dairy $21.14, Teams $30.62, Hogs $26.40, Poultry $4.70.
(Of this $12 is roughage.)
Labor Charge: E. A. Atkinson bill for board of Johnson $15, E. P. Johnson wages
$30
Labor Distribution: Mdse. $3, Chattels $6.25, Dairy $12.30, Teams $12.50, Hogs
$8.40, Poultry $6.21.
Team Use Distribution: Mdse. $4.
Journalize, post and take trial balance.
STATEMENT OF THE BUSINESS
It is now desirable to make a general statement of the business, so arranged as to show
-resources and liabilities, and losses and gains of the year. The first step is to take an Inven-
tory of property on hand like the one recorded Jan. 1, of this year. The student can make
the required statement from the data given below.
Merchandise — There is on hand the following: 15 tons timothy hay @ $6, 10 tons
clover hay @ $6, 2000 bu. corn @'40 cts., 2300 bu. oats @ 30 cts., 370 bu. wheat @ 90
cts., making a total value of $1973.
Real Estate — The various outlays for the maintainance of the real estate have kept the
soil and buildings unimpaired in value. Hence, items Nos. 1 to 7 of the first inventory will
be re-entered at the valuation $20736.50.
Chattels — The unclassified animals have increased in number and value being now worth
$600.
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