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The Columbia University Libraries reserve the right to refuse to accept a copying order if, in Its judgement, fulfillment of the order would involve violation of the copyright law. Author: Marsh, Christopher Columbus Title: The science of double-entry... Place: New York Date: 1854 MASTER NEGATIVE • COLUMBIA UNIVERSITY LIBRARIES PRESERVATION DIVISION BIBLIOGRAPHIC MICROFORM TARGET ORIGINAL MATERIAL AS FILMED - EXISTING BIBLIOGRAPHIC RECORD 1/^3517 RESTRICTIONS ON USE: Marsh, Christopher Columbus, h, 1806. The science of double-entry book-keeping, simplified by Uie application of an infallible rule for journalizing ... By C. C. Marsh ... Rewritten, enl., and improved, from the 20th ed., with an original d iagrttm. New York, J. C. Riker, 1 86 7. 1B54 218 p. foldi fr o n t, lllus. 231«". Ik Bookkeeping. i. Title. O Library of CoDgreM 3S-28792 HF0633.M37 1867 6ST TECHNICAL MICROFORM DATA FILM SIZE: .^nnm REDUCTION RATIO: ^^: ' IMAGE PLACEMENT: lA (^k) IB IIB DATE FILMED: 5^-^/ INITIALS: CU^ TRACKING « : MsH oanm HLMED BY PRESERVATION RESOURCES. BETHLEHEM. PA. '^. * ^ ** ^^^ (JO en 3 3 O > Is o ^ I^ to 2 C X OPQ ^ ::d N C/) ^-< OOM 3 3 > CD o m (DO d? hO«=: ^ o O CO X < N X ''c^: 3 3 €8 IS IP >< ai a>x ^-< 00 »M l>0 o 3 3 < o ^^ 00 IM 8 -r . ' -> ^^^ '.V -y-. ^^ Sohool of Business Libnzy Columbia University fJHii kO 46 Uonigomery Llbrar/ * of Accountancy - mtlifCilpofl^migark LIBRARY Retool of ?Bufi(tne0s( W^t montgomerp Hitirarp of ISccountam? 'i I' 4 y '"■^ " y wgjjffl^j i iau ipi w wii i' w IP %i(iaA^ , %/l/\ „ ^. \ .-^O ■^ ^ THE SCIENCE OF DOUBLE ENTRY BOOKKEEPING, SIMPLIFIED BY THE APPLICATION OP AN \ ■ .s N #1 \ . INFALLIBLE RULE FOR JOURNALIZING; CALCULATED TO INSURE A COMPLETE KNOWLEDGE OF THE THEORY AND PRACTICE OF ACCOUNTS : BEING A SERIES OF WELI.SELECTED MERCANTILE TRANSACTIONS, SO ARRANGED AS TO FORM A COMPLETE COURSE OF PRACTICE AND INSTRUCTION, AND DESIGNED FOR THE USE OF SCHOOLS AND COUNTING-HOUSES IN THE UNITED STATES: INCLUDING NUMEROUS EXAMPLES OF MERCANTILE CALCULATIONS. By C. C. marsh, Accountant, AUTHOR OF "SINGLE-ENTRY BOOK-KEEPING IMPROVED/' fcc "6 , '-Ho"-' - , ■' 1 • ••• ■'•»«9 e REWRITTEN. Ej:L.iRGED, ANp.^Ji^dVED. FROM THE TWENTIETH EDITION • « • * • 4 * « • • tt • • » • ■» • » NEW YORK: PUBLISHED BY JOHN C 129 FVhTOy STREKT. 1854. RIKER •m t . • 7. «i> JPfZZ Af35'/7 Montjpomery Library of AccounUw^y 46 - f //^r Entered according to Act of Congress, in the year 1850. Bt C. C. MARSH, Id the Clerk's OflSce of the District Court of the United States, in and tor the Southern District of New York. •• •» •,«§ • t • • • t • • • ■ < • * • • « • • a • • • • • * • * • • • ,• • •• 8TERKOTTPED BY C. C. SAVAOE. 13 Cbambera Street, N. Y. I > THIS VOLUME IS RESPECTFULLY DEDICATED TO THE CLERKS, €^t Mm SMrrrlinnts, nf tijt Mlti Itafes, WHOSE mTEORITY. AND ASSIDUITY m THE PERFORMANCE OF THEIR DUTIES HAVE LONG BEEN WITNESSED AND ADMIRED By THE Author. \ PREFACE. The increase of the trade and commerce of the United States, consequent on the increase of population, manufactories, and agriculture, and the universal confidence reposed in our political institutions, have called into requisition re- newed efforts in every department of science and literature. Twenty years ago, when the book which is the basis of this, was first published, works on book-keeping were not as common, nor so much in demand, as they are at present. Then, two were supplicating for public patronage ; now, more than a dozen contend for public favor: then, book-keeping was little thought of as a branch of education ; now, great exertions are made to render a practical as well as a theoretical knowledge of the science attainable by study and instruction. There are, perhaps, no people on the earth who have more necessity for skill and method in arranging accounts, than those of the United States. Here a most wonderful credit-system prevails. It is infused throughout all kinds of business, from the largest commercial establishment to the smallest retail shop — from the emporiums of the cities and towns to the remotest trading-house on the confines of civilization. All classes of society, and people of all occupa- tions, participate in it— the farmer, the mechanic, the rich man and the poor. It animates the adventurer, inspires the enterprising, encourages the industri- ous, and establishes the emigrant in the west. It fortifies the farmer and planter for a year's toil, and transports the products of their labor to a market. Such a System of doing business is as much the offspring of confidence and good will in man toward his fellow-man, as of capital. I truly believe that no people buy as much, consume as much, and pay for as much, as the people of these states. No one here thinks of hoarding money, and few are satisfied to live as they have lived, or to go on as they began ; but as soon as they possess any means above their immediate necessities, everything about them is improved, enlarged, and even beautified. Thus it would seem that credit and capital are on a par, equally active and never at rest. Book-keeping is so extensively required, that it becomes difficult to say who may not stand in need of the knowledge embraced under its name. No one, however, who has even distant expectations of being engaged or interested in mercantile affairs, manufactories, or in joint-stock companies, ought to omit to make that science a study. By this I do not mean that all should or can be- come book-keepers, but that those engaged in any kind of business, that possess capital or that control it, and those who make a profession of the law, should make themselves acquainted with its principles as a science, with the names and purposes of the common account-books, with a systematic method of sta- ting accounts, and with the various calculations belonging to them. Unless they do this, they can not read an account, much less understand one. Doct. Johnson says, in his preface to Bait's Dictionary of Commerce, " Let no man enter into a large business while he is ignorant of regulating accounts ; never let him " PREFACE. imagine that any degree of natural abilities will supply this deficiency or pre- hat book-keepmg was a science that required to be studied before it could be understood, and that the knowledge acquired by such study would be of inesti- mable value to the man engaged in business. sulject-that he thmks belongs to those who are more likely to look on all ;i.h an ,mpar..al eye ; but he may. he presumes, without offence to anyTve U.S vews on some of the different methods of teaching book-keeping. Onf of the more cominon presents the science to the student in such a form that he volume filled w.th account-books and general rules, and appears to take for granted that to see the entries and operations, is to understand them. Another essays to teach the science by an ingenious way of ruling the books and by des,gnat.ng for what purpose are the different columns, ^his pit' supposes that every one knows who are the debtors and creditors, what is to be charged and what credited, and therefore furnishes no instruction in refer- ence thereto. Another proposes to accomplish the object by teaching a theory and practice separately; by this plan, the pupil begins the study at the Lege and g^ backward. In this method, I think it is asserted that you mighfas well bZ accounts m the Leger with the words •■ Red" and " Black." as to head thrm with those of Dr. and Or. ; indicating that these words h^ve no" their usuS sigmfications when applied to book-keepin". But the worst of all is. that these and most other methods teach that 7ZT " '"' '." 'T """' """"»''• ■"«""-? ""a, the acco^« LI !hU T """w. T\°' ^"- ''°*'"^' '■" "y °"»<'' «"" ^ -"o- absurd than this; for. although things may owe us. and we may owe them, thel can notor^e each other. This is an error which relates directly to th^ thi^ 7.\ ZZ f^^ 'y° ,"""" ^"^"^ '" '™''*' "'<' science inaccessible. Such a method of teaching leaves the party most interested entirely out of til tT?' 1 ' L"'*' incomprehensible suppositions for simple reali- ties The truth IS, not the accounts, but the objects which they reprint are the debtors; and not debtors to each other, but debtors to the owner of Ae books. I, IS to this common error that may be attributed the deficiency of practical instruction in this branch. ' I would not say that these methods are so bad that no one can learn bv them but that It IS my humble opinion that the very faults and errors to which I h."; ™ h!r* ^T "'! '°r °''''''°" "'■'*" "P'"^^''' ^'^- "•« book-keeping can not be learned at school. •^^'^i^iujf .n.w"Ti°^ ^^ double-entry is undoubtedly a «:ience, and not merely . coUection of forms and arbitrary rules. Every operation in it being susceptible of rational exposition, there is no doubt that it can be taught with much Lter effect by pursmng a course more in accordance with the modern methods of teachmg most branches. Arithmetic, for example, is much better taught now PREFACE. , than formerly, because it is taught more by reasoning and less by rules. The modern method of teaching. I believe, is by experiment and example, rather than by rule and precept ; m it the practice and theory are united, but the theory fol ows, not precedes, the practice. A question is proposed, the operation is performed and explained, and then follow the principle and rule. This is the natural way; and in this order, if I mistake not. have originated all the scien- ces-firs the lact was discovered, and then a theory was made to account for 1 1. Facts originate theory, and not theory facts. This book does not profess to be a new system of keeping accomits. but an improved and more efficacious way of teaching the theory and practice of the an. leaching book-keeping does not consist so much in explanations of the forms and purposes of the accomit-books. as in expositions of mercantile trans- actions. To know what the Cash-Book is for, and to know how to make an entry in it, are very different things-quile as different as knowing what a vio- lin IS for, and knowing how to play on one. The object should be to teach the 7r K "A°" ""1^ " ^^' °' '""^ "' accomit-Wks, variable at Te wm iftW '*""'' ^"^'"^ ^''^ "" ■"""* "'■ "^^ ^^'"'^ «° ^ '«="e Books ,'/,] 55 Explanations of the closing Entries ..... 55 Opening Books sg BiTsiNKSs OF May — Relating to— Clerks' Salaries— Deliver- ing Note for Debt due— Investing Money in Stocks — Receiving Account-Sales — Receiving Account-Current with balance of Interest— Receiving Draft for balance of Account— Delivering Note on Open Policy— Shipments in Joint-Account— Montlily Entry of Purchases— Monthly Entry of Salen— Monthly Entry of Cash received— Monthly Entry of Cash paid — Correcting Errors 57 Elucidations of the Journal Entries .57-59 Explanations of the Monthly Entries 58 Correcting Errors 47 200 duEsTioNs AN D ANSWERS, relating u>— Opening Books 60,61 Conducting B ^oks 62-68 Closing Books 68-70 Day-Book — containing 150 Business Transactions 7^ Journal — CMitaiiiing 120 Entries 93 Leger — containing 40 Accounts 109 Cash-Book — containing 80 Entries 155 Invoice-Book— containing 4 Entries 165 Sales Book— H^ontaining 4 Entries 169 Commission Sales-Book — containing 25 Entries 173 Bill-Book — containing 40 Entries 179 Mkrcantile Forms — Receipts— Orders — Promissory Notes — Drafts— B ills of Exchange 186, 187 Accounts of Sales 188, 189 Accounts-Current without Interest 190 Accounts-Current with Interest 192-196 Accounts-Current averaged 198 Letters — Circular 201 On Ordering Goods 202 On Consigning Goods ' 203 On rendering Account-Sales 204 On drawing Drafts 205 On rendering Accounts-Current 205 Mercantile Calculations — Discount and Interest 206 Common Divisor of 6000 — how found-. 208 Commission and Insurance 208, 209 Exchanges — English, French, &c 209-211 Equation of Payments — Averaging Bills 214 Averaging Account-Sales 215 Averaging Accounts 216 Averaging Balances 2H 217 Profits and Losses 219 *^* This work is published in the SrAirisH Lahooaok in the same style. DIRECTIONS TO TEACHERS. It is evident, since book-keeping is the disposition of business transactions in account-books, that there is no more effectual way of teaching that science than that of furnishing the pupil with a course of well-selected mercantile transactions, of teaching him to make the entries of the same in the different account-books, and dispensing the necessary instruction as the transactions arise and the occasion may require. In this manner the pupil becomes famil- iar with the forms and objects of all the account-books in common use in mer- cantile or commercial houses, gains no insignificant idea of business affairs, and eventually arrives at a just conception of the science — its theory and prac- tice. Such a method of teaching book-keeping is undoubtedly the most natu- ral, interesting, and practical ; and I know, from many years' experience, that yery beneficial results accrue to the pupil when it is pursued under the gui- dance of any intelligent teacher. In order that the pupil may enter upon the course of instruction laid down in this work for him to pass through, let him have a set of five blank books — Day-Book, Journal, Leger, Cash-Book, and Bill-Book.* The first three may each contain eight sheets of cap paper, ruled to correspond with those books ; the other two may contain about three sheets each, ruled, &c. Next, let the pupil transcribe into his Day-Book the transactions of January, from the Day- Book of this volume, inserting his own name in place of Thomas Blanchard. The entries of the notes in the Bill-Book should be made at the time of copying the Day-Book entries, as the notes arise in the transactions. The same in re- spect to the Cash-Book ; let the pupil enter in it all the sums of money received and paid, as he receives and pays them, composing his entries from the Day- Book on a separate sheet, and, when correct, copying them into his Cash-Book. Next, let the pupil begin to journalize : he will make his Journal entries first on a separate sheet, and, when found correct, copy them into his Journal. Next, he will post, or make entries in his Leger ; and, lastly, make a trial- balance from the Leger. He may balance the Cash-Book one, two, or more times during the month. If one part of the science is to receive more attention than the other, it is the journalizing ; this is fully and constantly explained, and the explanations dated to correspond with the transactions and entries. In general, the order of pro- ceeding with the course of instruction is most carefully delineated in the first sixty-eight pages ; and it is confidently believed that teachers will find the con- tents of this book very conveniently arranged for teaching in classes or otherwise. *Aathe Inyoice and Sales Books include nothing more than deeoriptions of goods bought and sold, it is not thouglit wortli while tu iiitruduce thein into the cuuriie. Blank Books in sets (six to the set), arranged by the Author, may be had of the Publisher. >, THE SCIENCE OF DOUBLE-ENTRT BOOK-KEEPING. SIMPLIFIED. INTRODUCTION. The Bcience of Book-Keeping by double-entry teaches to record, systematically and free from eiTor, the various transactions of business or of the mercantile profession, so that the merchant may know his pecu- niary situation, be able to substantiate his claims and protect his prop- erty, and at dissolution may leave behind him such evidence as will enable his friends to understand his commercial relations and engage- ments, and to wind up his affairs in a manner satisfactory to all parties concerned. ^ To exhibit with clearness and regularity a correct and continued record of the mercantile transactions that occur between ourselves and others, we deem it necessary to introduce the following books : 1 2 3. 4. 5. 6 7. 8. Invoice-Book. SaijEs-Book. Cash-Book. Commission Sales-Book. Bill-Book. Day-Book, ^ Journal, > Principal. Leger, ) Of these books, the Cash-Book, Sales-Book, Day-Book, Journal, and Leger, appear to be indispensable in all houses ; while the others may or may not be required. For instance, if no promissory notes are ^ven or received, there would be no occasion for the Bill-Book ; and if the bills of purchases or invoices were filed away with care, the In- voice-Book might be dispensed with. 12 INTRODUCTION. INVOICE-BOOK. — This book should contain a minute description of all the merchandise with which we are concerned — all that we buy or receive. Entries in this book consist merely of copies of the bills or invoices of goods bought, or received to be sold on commission. The original bills and invoices should be preserved with care. SALES-BOOK. — This book should give a description of all the mer- cliandise we sell or pass out of our possession. At the time the pur- chaser selects his goods, they are described in the Sales-Book— quantity, • {uality, and price; and from this book we make out his bill. In this order we may render a second or third bill exactly like the first. CASH-BOOK. — This book shows all the sums of money which we pay or receive, with a short explanation relating to each sum. The entries in this book are made at the time of paying or receiving the money. In a business where there are many sums received and paid, this book should be balanced daily ; which is done by adding both pages (Dr. and Cr.), and subtracting the total paid from the total received, and the dif- ference will be the ** balance on hand." This balance should agree with the money itself COMMISSION SALES-BOOK.— This book shows the particulars )f merchandise sold by us for others. Entries are made in this book ,rom the common Sales-Book, and from it we make the Accounts of Sales that we may have to remit to those for whom we have sold. BILL-BOOK. — This book shows a description of all the notes or acceptances in oiir favor or against us, with their dates, credits, when due, and amounts. Those in our favor are entered under the head of Receivable, and those against us under Payable. DAY-BOOK. — This book shows a clear, simple, complete, and brief relation of all the transactions of our business. The greater part of the entries in this book are taken or composed from the Invoice-Book, Sales- Book, and C ash-Book. The Day-Book may be considered the most important of all the books, as it gives us a complete history of our business. JOURNAL. — This book shows the names of the debtors and credit- ors of all the transactions recorded in the Day-Book, for the purpose of transferring the same from the Day-Book to the Leger. All the science of Book-Keeping is embraced in the Journal. LEGER. — This book shows the accounts of all our debtors and cred- itors. The entries in this book are drawn from the Journal. The great and only object of this book is to show the result of our business with every person, property, and object. Every sum that any individual or object may owe us or we may owe him, from the beginning of the business to the present time, will be found under its proper head in this hook. JOURNALIZING. All the explanations of business transactions, and the entries they require in the Journal, will be found on the immediately following pages. The reader need not look in the Day-Book, Journal, or Leger, for instruction, because those books give the business that is supposed to occur, and not the instruction. By this arrangement, the student will derive the advantage of knowing which part of the volume is to serve as his teacher, and which part he is to learn or be taught. INFALLIBLE RULE. In order to render that part of the subject commonly considered diffi- cult, more simple, positive, and rational, and to conduct the mind of the reader or student into its true elements, securing, at every degree of advancement, a clear understanding of whatever arises for his consider- ation, I can not recommend a too close observance of the one and only rule needful. This rule originates thus : — Book-Keeping, or the science of accounts, is a systematic exhibition of all that is owed us, and all that we owe. These are our Creditors, and those our Debtors ; consequently, the science may be said to be founded on the two words. Debtor and Creditor. Hence arises the rule — infu' lible in its application, and in its truth self-evident. THE RULE. Whoever or whatever owes us is Debtor Dr. Whoever or whatever we owe is Creditor Or. Or, in other words — Debit whatever owes us ; and Credit whatever tt?e owe. Or, we may resolve the rule into the following simple questions : What person or object owes us ? For that alone is the Dr. What person or object do we owe ? For that alone is the Cr. Note.— There is a discrimination in the sentences of this rule, not at once perceived by all readers. Every mercantile transaction contains many more debtors and creditors than we are directly concerned with. For instance, in the simple transaction of buying merchandise, there are four debtors and cred- itors from which we have to choose in making a Journal entry: 1st. Mtr- womma 14 JOURNALIZING. cliandise is a debtor, because it owes us for its cost ; 2d. We are debtor, be- cause we owe the person of whom we bought ; 3d. Merchandise is creditor, because the person who sold it owes it for the value it produced him ; 4th. The person we bought of is creditor, because we owe him. Here, then, we find two debtors and two creditors arising out of this little transaction : but the rule says that only those that owe m5, and those that we owe^ are to be counted as debtors and creditors in our books, however many more there may be. THE BUSINESS OF JANUARY: Embracing Entries of twenty-six Transactions, relating to— Entering into Partnership — Ad- vancing Capital— Assuming Partners' Debts— Simple Purchases and Sales — Simple Be- ceipts and Payments— Loans— Loans on Notes and Interest — Receiving and Delivering Note»— Paying our Notes. The Day-Book commences with a statement of the situation of the party or parties entering into partnership — what capital they possess, and what it consists of; what they owe, and how they owe it. In making Day-Book entries, or recording a transaction in the Day-Book, we do not say who is debtor or who is creditor, because this belongs to the Journal. The capital being advanced — that is, the money deposited in the banks and entered in the Cash-Book — the notes described in the Bill- Book, the inventory of merchandise copied' into the Invoice-Book, arid the articles of agreement signed and exchanged, we make an entry in the Day-Book similar to that which appears in said book under date of January 5, 1850. The Journal commences with an entry formed from the first one in the Day-Book. The entry consists of a resolution of those that owe utt and those that we owCy for the purpose of conveying the same to the Leger. These Journal entries are made by the application of the rule, thus : Read the Day-Book entry carefully, and endeavor to find — Who or what owes us, and write that as Dr. Who or what we owe, and write that as Cr. Day-Book — January 5. The first entry in the Day-Book gives the following entry in the Journal : — Journal — January 5. Sundries Dr. To Sundries. Cash $38,000 00 Bills Receivable 4»670 00 Merchandise *»125 00 Charies Lawrence 1^0 OQ S45,935 00 To Thomas Blanchard 28,000 00 ToC.C.Marsh 17,935 00 45,935 00 JOURNALIZING. 15 J- Elucidation. — The words " Sundries Dr. To Sundries'* are merely a preface to the debtors and creditors, indicating that there are more than one that owe us, and more than one that we owe. The first four names in the above entry are called debtors. We have now to show why they are so. Cash is debtor, because that kind of property denominated Cash owes us for the amount of value we have in it — viz., $38,000. Bills Receivable are debtor, because the notes which we hold against different persons, owe us for the sums for which they are written or drawn — viz., $4,670. Observe, it is not the persons who have given us these notes that owe us, but the notes themselves ; our claim for the value consists in the possession of these notes. The title of bills receiv- able is applied to all paper claims in our favor, such as notes, drafts, &c. ; but there is no necessity to give anything a title until ice have deter- mined whether it owes us, or we owe it. Merchandise is debtor; because that property owes us for the value in it, which is $3,125. Charles Lawrence is debtor, because he owes us for the amount of a claim that we have against him — $140. The creditors are — Thomas Blanchard, who is creditor because the firm, Blanchard & Marsh, owes him individually for the amount of capital he has advanced —$28,000. C. C. Marsh, for the same reason, for his part of the capital advanced —being $17,935. The sum total of the debtors should be extended into the last column, and should agree with the amount of the creditors also ex- tended. The amount of the sums of the debtors, and that of the creditors, should always be equal in every Journal entry. When an entry in the Day-Book has been Journalized, or entered in the Journal, we place the page of the latter in the margin of the former, opposite the said entry. Note. — We make a distinction in the position of the debtors and creditors in the Journal entries, by placing the debtors close against the line on the left, and the creditors about an inch further to the right. The preposition ** To" is always placed before the names of the creditors, because the meaning is, that we are /)-. to those creditors ; we are Dr. being words understood and not expressed. Day-Book — 2d Entry of January 5. The transaction under this date in the Day-Book gives the following debtors and creditors, or Journal entry : — Sundries Dr. To Bills Payable. .$2,310 00 Thomas Blanchard $1,080 00 C.C. Marsh i'230 00 2,310 00 16 JOURNALIZING. Elucidation. — In this entry, as in the first, the debtors are prefaced by the word Sundries, there being more than one debtor. Thomas Blanchard is debtor, because he individually owes us (the firm) for the amount of his note, which we have assumed. C C. Marsh is our debtor for the same reason. The creditor in this entry is Bills Payable. It is so because we owe the notes; liaving assumed them, they now stand out against us as our owik Bills Payable is a title given to notes and acceptances with our sig- nature in favor of others. Day-Book — January 7. The transaction of this date in the Day-Book gives the following en- try in the Jounial : — Store-Fixtures Dr. To Cash $300 00 Elucidation. — The store-fixtures are a property which has cost us $300, for which it owes us, and therefore is debtor. Cash is creditor, because we owe that properly for paying the sum for us. For example, if John Sims had paid for the store-fixtures for us, we would then owe him instead of Ceish. Observe, that when we write " Store-Fixtures Dr. To Cash," we do not mean to say that the former owes to the latter, but that Store-Fix- tures are debtor to us, and that we are debtor to Cash. If this Journal entry were written in full, it would read thus: — Store-Fixtures are Dr. to us for $300 00 We are Br. To Cash .for 300 00 We ought never to forget that the words in italics, although never expressed, are always to be understood. Omitting these words, leaves the entry as it should be in the Journal. I Day-Book — January 8. The transaction of this date in the Day-Book gives the following en- try in the Journal : — Paul Harris Dr. \to %ls) ( We are Dr.) To Merchandise $325 00 Elucidation. — Paul Harris is debtor, because he owes us for the amount of the goods sold to him. Merchandise is creditor, because we owe that class of property for having produced us, in this case, $325. For the value that Merchandise has produced us. Hams is responsible. We never see the word Cr. (creditor) in Journal entries. It is un- necessary, because the debtor lieing always named Jlrst in the entry, it follows that the second must be the creditor. JOURNALIZING. Day-Book — January 10. 17 The transaction of this date in the Day-Book gives the following en try in the Journal : — « 6 Bills Receivable Dr. {to us) ( We are Dr.) To Merchandise ^500 OO ,?,^^^'?;f ™^— The promissory note of William Blakeley, which we entitle Bills Receivable, is debtor, because it owes us for the value the merchandise has produced us — $500. ^r'^^nn^^^T^i^® '^ creditor, because we owe it for producing us the sum ot 5PO00. It a man had produced or given us $500, we all would be wilimg to owe him, or credit him, for it ; why not, then, acknowledge ourselves indebted to merchandise for what it produces ? Day-Book — January 12. tr '^in^reTo^urir^.— ^^'^ ^^^^ '"^ ^^^ Day-Book gives the following en- Cash Dr To Merchandise... ^i25 00 th^ZlT'^T'T^^^ i' debtor, because it owes us for the value that the merchandise has produced us, for that value is in the cash. Cash is Tt didSre ^^ '''^^' ""' ^^^^ '^°''^ "'"''^ ^^^ transaction occurred than Merchandise is creditor, because we owe it for producing us the $125. Day-Book — January 13. Oliver Otis & Co. Dr To Merchandise ! $2,000 00 not yet paW ^°'"^' ^' *"""" "''^ '^""' ^"^ ^^^ ^^ch they ha^ The Merchandise is creditor, because we owe it for the value it Hm produced us, and for which Otis & Co. are responsible. Day-Book — January 14. try^nXX^al :!*" '"'' " '"" ^^y^""" ^"'^ ""« «>"°-»S - Merchandise j). To Henry Austin .' jig^o ^^ thafsr^r^r^^e Itt dXot"''-^ "^ "'-' "^ *'•'''' '' "^ "^ «" 3 18 JOURNALIZIMG. : 1 Henry Austin is creditor, because we owe him for the goods we have bought of him. DaY-BooK — January 14 (2d traniaclion of thi« date). The second transaction of this date in the Day-Book gives the follow- ing entry in the Journal : — Merchandise Dr. {tout) ( We are Dr.) To Cash ^800 00 Elucidation. — The goods we have bought are debtor, because they owe us for their cost — $800. We are debtor to Cash, because that article has paid Rogers & Bros, for us ; therefore Cash is the creditor, expressed as above. Note.— It is not exactly true to say that we paid Rogers & Bros, for the merchandise in the above transaction. We could not do it of ourselves ; we must employ some agent ; the agent in this case was Cash. Day-Book — January 16. The transaction of this date in the Day-Book gives the following en- try in the Journal : — Merchandise Dr. (to us and we) To Sundries.. $3,200 00 ToCash ...$2,000 00 " Merchandise 1>200 00 3,200 00 Elucidation. — ^First, we always ask ourselves, what owes us ? And we write down what we think owes us as the Dr. The merchandise owes us, because it has cost us $3,200 ; and we owe the Cash for having paid $2,000 for us toward the payment of $3,200 ; and we owe to some other goods, likewise called merchandise, for hav- ing paid for the balance— being $1,200. We find, then, in this transac- tion, one debtor and two creditors. Day-Book — January 17. The transaction of this date in the Day-Book gives the following en- try in the Journal : — James Truman Dr. {to us) ( We are Dr.) To Cash tl,000 00 Elucidation. — Truman owes us for the amount wo have lent him. Cash is the creditor ; or, we owe to Cash for paying the amount to J. Truman for us. Day-Book — January 19. The transaction of this date in the Day-Book gives the followiiig en- try in the Journal : — JOURNALIZING. 19 Sundries Dr. (to us and we) To Oliver Otis & Co. $2,000 00 Bills Receivable ^i^qOO 00 ^^^ 1,000 00 2,000 00 ELUciDATioN.-The word "Sundries," as we have before said, is merely a preface to the debtors, which are placed directly under it «« nl^ yf livable owe us for part of the sum that Otis & Co. have paid lis, and therefore are debtor. ^ Cash owes us, because we have received part of the sum that Otig « Co. owed, m cash. in ^nm;Ti^^^'V* P^''^'' ^^^^ "' "^^^^ ^« o^^^' ^^ cou'se he must pay us in some class of property ; consequently, the property or thin? S whj c h he Enl'p'ii°p'' "' i^' sum which the person owed. In ths manner we s^^ how Bills Receivable and Cash owe us, and become debtors iS place oTot's Otis & Co. are creditors because we owe them for having paid us the sum they owed, and for which we had charged them. Note.— If we should think that we do not owe Otis & Co., because thev have only paid us what they owed, still we must agree in this • that as thev have paid us $2,000, they ought to be credited foTthat sum whicramounts wei^ToU hir"^ "^ ^"^''^"'- ^— one should be credited fo'Xt Day-Book— January 21. Bills Receivable Dr. (to us) (WeareDr.) To Paul Harris $335 ^^ Elucidation.— The sum which Harris owed us is now owed to us bv the note, which we call Bills Receivable ^ yn^TX^^^'""^ "^^"^ T "^^.^'^ *^^^^' ^^« ™ade «« responsible to him for the same sum ; for which we credit him, or for which we owe Day-Book — January 22. , S^^ ■ Dr. (to u,) (WeareDr.) To James Truman ji^qoO 00 ELUciDATioN.-Cash ou,e, u,, because in this class of property we * we re::rft "' '"■" *'" '' ?"'' "»• «-'' " ^'-^y^ - Sr wC ..e'r pai^Zo" aX:r:fc^'""'^ -^ "- '"- «" ^^ «- which 20 JOURNALIZING. . t! Ml Note. — It is very necessary to understand well the exact use and import of the words debtor and creditor^ because the most important part of this science consists in being able to find^with facility "who or what owes us," and "to what or whom we owe," in^l mercantile transactions. A clear understand- ing of the more simple transactions will ajQTord us great aid in disposing of the more complicated. For this reason we are so particular in explaining the simple entries of this month's transactions. Day-BoOK — January 22 (2d transaction of this date). The second transaction of this date in the D ay-Book gives the follow- ing entry in the Journal : — Henry Austin Dr. {fo us) ( We are Dr.) To Bills Payable $1,500 00 Elucidation. — Having paid H. Austin what we owed him, he now owes us for the sum we owed him, which balances his account, or makes us owe each other equally. We owe to our note (which we call Bills Payable), because it has paid Austin for us ; or, because our note stands out against us, holding us responsible for the face of it — $1,500. Note. — It may appear absurd to some, to say, in this transaction, that Aus- tin owes us ; but he does, nevertheless, and it may be proved thus : We owed Austin $1,500, which will always appear on the credit side of his account in our books ; nothing should or can obliterate the transaction that made us owe him. Now, then, the only way we can settle this debt, is, not by getting out of his debt, but by getting him into our debt for the same amount ; therefore, when we pay him what we owe him, he owes us for the sum paid him, which makes us owe each other equally. All the sums on the credit side of an account in our Leger, are sums that we owe, and those on the debit, are sums owed to us. It is only the balance, or difference, which is to be paid. Day-Book — January 24. The transaction of this date in the Day-Book gives the following en- try in the Journal : — Sundries Dr. To Merchandise.. $4 10 00 S. H. Lovell $250 00 Cash 160 00 410 00 ELUCiDATioN.-^The " Sundries" (Lovell and Cash) owe m, h^cause the amount that Merchandise has produced us is in them ; they are therefore debtors. We are debtor to Merchandise, or, which is the same thing, Merchan- dise is our creditor, because we owe it for producing us $410. JOURNALIZING. 2\ Day-Book — ^January 26. Elucidation. — Similar to that of the 24th. Day-Book — January 28. The transaction of this date in the Day-Book gives the following en- try in the Journal : — Bills Receivable Dr. To Sundries. .$2,121 00 To Cash $2,000 00 " Interest 121 00 2,12100 Elucidation. — In this transaction we lend money on interest, and receive a note for the amount that will be due at the end of the year. The note is. responsible to us for the amount; the note owes us, and therefore it is debtor for the amount it is drawn for — $2,121. We say " To Sundries," because we owe more than one — Cash and Interest. Cash is creditor, because it has paid to J. Truman for us the $2,000. Interest is creditor, because we owe it for producing us the $121. Interest is a branch of our business. The name our business receives in our books is Profit and Loss ; therefore, Interest account is a branch of the Profit and Loss account. NoTE.--This science renders susceptible of responsibility things as well as persons; that is, in the same manner that John Sims becomes our debtor or creditor, so may a bag of coffee, or a box of sugar. Our Business, which we entitle ''Profit and Loss,'* may also become our debtor or creditor, like Sims or the coffee. When it is in our favor, and produces us value, we owe it and It becor-.es a creditor ; when it goes against us, and costs us, or makes us lose it owes us, and it becomes a debtor. * Day-Book — January 30. The transaction of this date in the Day-Book gives the followinff en- try in the Journal : — ^ Bills Payable Dr. T<^ ^^^ $1,230 00 Elucidation.— The note, now pai4 and cancelled, was issued by our partner, Mr. Marsh, before this partnership began, and it was assumed by us as our own. Bills Payable (the name we give to the note) is debtor, because it owes us for having paid it what we owed it. Had we paid a person what we owed him, he would be debtor : the note is to be treated as a person. It v^ not T. P. Cope that we owed; it was the note, in whosever hands it might have been. \y'e are debtor to Cash, or Cash is the creditor, because we owe it for paying the note, or the sum of the note, for us. %. -«A^ POSTING. 23 I 'I il POSTING The transactions of January having been Journalized — that is, pre- pared for the Leger — we will now begin to post. Posting is a very simple operation, being little more than copying from the Journal into the Leger. The object of posting is to enable us to find all concerning one thing or person, from the beginning of the business to the present, at one place in one book — the Leger. Example. — Merchandise, we perceive, is concerned in most of our transactions, from the beginning to the end of our business ; therefore, if we do not collect all relating to it at one place, we can not ascertain, without much difficulty, the amount we have bought or sold : and should we desire to know how much any person owes us, or we owe him, we would be obliged to examine the Day-Book from the first page to the last ; but when his account is posted, we have only to turn to a certain page appropriated to him in the Leger, where we shall find the result of all our transactions with him. By the aid of the Journal, we deduce from every transaction in the Day-Book all that owes us, and all that we owe, which is all that passes into the Leger. The Journal, therefore, serves to convey the debtors and creditors from the Day-Book to the Leger. Note. — To the Leger belongs an Index, which is often a part of the book ; but it is more convenient to have it separate. Wfe now proceed to show the operation of posting — transferring the debtors and creditors, with their sums, from the Journal to the Leger, beginning with the first entry in the Journal. TouRNAL — January 5. Sundries Dr. To Sundries. Cash $38,000 00 Bills Receivable 4,670 00 Merchandise 3,125 00 Charles Lawrence 140 00 $45,935 00 To Thomas Blanchard 28,000 00 ToC.C.Marsh 17,935 00 45,935 00 5 4 10 1 1 If To Post the above Entry. — As " Sundries Dr. To Sundries" is only a preface, the first thing that we see in the above entry is " Cash Dr. $38,000." Cash, therefore, is the first account to be opened in the Leger. We appropriate for it page 2, and vmte in the centre of the book (or page) the word " Cash," and on the sides, the abbreviations. "Dr." and " Cr." Note.— The tferm " Dr." is always on the left, and the " Cr." on the right. Cash being a debtor in the above entry, we mus? make the entry on the debtor side of the account, thus : In the 1st and 2d columns, we write the date ; in the 3d column, the preface of the other part of the Journal entry, which is, "To Sundries;" in the 4th column, the page of the Journal from which we take the entry ; and in the 5th, the sum that Cash owes us, being $38,000. (See the Cask account in the Leger, page 2.) This done, place the folio of the Cash account against the word "Cash" in the Journal, to indicate that il is posted. Enter the title "Cash" in the Index. ^ So far, we have only posted the first debtor; the others, which are Bills Receivable, Merchandise, and C. Lawrence, we post in the same manner, in the order they come, but on separate pages. We now piss to the creditors of the foregoing entry, the first of which is •* Thomas Blanchard." For him we open an account on page 1, by writing his name and the abbreviations " Dr." and " Cr." As he is a creditor in the entry, we must make the entry on the creditor side of the account ; and in the 1st and 2d columns we write the date ; in the 3d column, the preface of the other part of the Journal entry, " By Sun- dries ;" in the 4th, the folio of the Journal ; and in the 5th column, the amount — $28,000. In the Journal, opposite his name, place the page of the Leger, to show that it is posted. The other creditor, C. C. Marsh, is posted in the same manner. As the Journal presents only four different forms of entry, it will be necessary to make only four distinct explanations to teach that part of the science called Posting. Having given one explanation, we proceed now to the second. Journal — January 5 (2d Entry of this date}. 6 Sundries Dr. To Bills Payable ..$2,310 00 1 Thomas Blanchard $1,080 00 I C. C. Marsh 1,230 00 2,310 00 To Post the above ENTRY.-^-Blanchard & Maish being our debtors, m this entry for the sums in front of their names, we return to their ac- counts, already opened on page 1, and in the 1st and 2d columns, on the debtor side, we write the date; in the 3d column, the opposite part of the Journal entry, "To Bills Payable;" in the 4th, the folio of the Journal from which we take the sum ; and in the 5th column we write the amounts — $1,080, and $1,230. This done, we allot, for the account of " Bills Payable," folio 6, where we open it by writing, as before, its name and the abbreviations " Dr." and " Cr." Bills Payable standing as creditor in the Journal entry for $2,310, we make entry on the creditor side of the account, by writing in ^^ 24 POSTING. TRIAL BALANCE. 25 11 the first columns the date ; in the 3d, the preface of the opposite part of the Journal entry, " By Sundries ;" in the 4th column, the folio of the Journal from which we take the sum ; and in the 5th, the amount for which Bills Payable ought to be credited — $2,310. 6 Store-Fixtures 2 To Cash Journal — January 7. Dr. .'$300 00 To Post the above Entry. — This entry varies from the others, t>e- cause it consists of only one debtor and one creditor— the others have more. We open an account for the debtor (Store-Fixtures) on folio 6, and write on the debtor side the date and " To Cash," the page of the Journal, "1." and the amount— " $300." Cash, in the above entry, is the creditor; therefore we turn to the Cash account, already opened on folio 2, and write, on the creditor side, the date in the Ist and 2d columns, • " By Store-Fixtures" in the 3d, the page of the Journal in the 4th, and the amount in the 5th— $300. This done, the entry is posted. -it We must never forget to place the folios of the accounts m the Leger against their names in the Journal, when they have passed into the Leger. The following Journal entry, the last the posting of which requires explanation (all others being posted in the same manner as those al- ready explained), we find in the — t Journal — January 16. 4 Merchandise Dr. To Sundries.. $3,200 00 2 ToCash «2,000 00 4 To Merchandise 1>200 00 3,200 00 To Post the above Entry.— Turn to the account of Merchandise, folio 4, and on the debtor side write, as before, in the Ist and 2d col- umns, the date ; in the 3d, the preface of the opposite part of the Jour- nal entry, « To Sundries ;" in the 4th column, the page of the Journal j and in the last columns, the amount for which Merchandise ought to be charged or debited — $3,200. The creditors in the above entry are Cash and Merchandise, which * Note.— The word "By" does not appear in the Journal entries, because the names of the debtors are always placed before the creditors. If their p(> sitioQ was reversed, the % would appear, and not the ^f-. ^1 we make a Journal entry with the debtor first in order, the /orm would be difi-erent, but the meaning would be the same. Thus, in the entry of January 7— ^"' By Store-Fixtures ":" ^300 00 This is the way the entry reads, when we post it into the Cash account in the Leger. "I are carried to the Leger by writing on their creditor sides — ^in the first two columns, the dates ; in the 3d, the opposite part of the Journal en- try, " By Merchandise ;" in the 4th, the page of the Journal the entry comes from ; and in the last columns, the amounts for which they should be credited. In opening accounts in the Leger, we give to^ach a certain space, according to the business that we think we may have with the person or property ; and we generally leave some forty or fifty of the beginning pages of the Leger, for private accounts, such as Cash, Merchandise, Bills Receivable, Bills Payable, Discount and Interest, Commission, Profit and Loss, &c. Having Journalized and Posted the transactions, or entries, of the month of January, we will now proceed to make out a Trial Balance. TRLA.L BALANCE. The Trial Balance is a collection of all the balances that appear in the Leger, exhibited in two columns ; the debtor balances in one col- umn, and the creditor balances in the other. In proceeding to make the Trial Balance, first add and subtract the columns of every account in the Leger. Do this with a pencil, in small figures, setting the balance, or diflerence, on the side that is the larger. Next, we copy off the said balances of the accounts on a sheet of paper, putting the debtor balances, with their names, on the debtor side, and the creditor balances on the creditor side — in the following maimer : — Dr. Balances of January 30, 1850. Cb. 2 4 5 6 10 11 12 13 Cash Merchandise Bills Receivable , Store-Fixtures . . C. Lawrence... . O. Otis & Co.... S. H. Lovell W.Blakeley.... $33,205 5,515 8,61G 300 140 200 250 200 48,426 00 00 00 00 00 00 00 00 00 1 1 6 7 T.Blanchard C.C. Marsh Bills Payable Disco tmt and Int*st. $26,920 16,705 4,680 121 48,426 00 00 00 00 00 26 TRIAL BALANCE. JOURNALIZING. If the entries in the Journal have been posted correctly to the Leger, and the additions and subtractions have been made without eiTors, the amounts of both columns will be equal. On the contrary, if the totals are not equal, it is certain evidence that there are errors, which we must endeavor to find and correct. Whatever may be the nature of the error. It may be found by Referring to the Journal to ascertain if the Sundries] m every entry, are added correctly, or equal the amounts extended into the last column ; because, if the sums of the debtors and creditors do not equal each other in the Journal, they can not be equal in the Leger. See, also, if all the sums have been posted, or carried to the Leger cor- rectly ; and next, complete the examination by re-adding and re-sub- tracting all the accounts or columns, to ascertain if the balances are cor- rect. If the first examination does not produce the result desired, it must be repeated until the debtor and creditor columns of the Trial Balance come out equal. When completed, fold it up, and endorse it, * Trial Balance of January 30, 1850." Note.— It will be well not to leave the Trial Balance in the counting-room, ATith the books, because, in case of fire, and the destruction of the books, it w^ould be almost as valuable to us as the books themselves. The Trial Balance proves the three following important operations! but no other, viz. : — 1st. It proves that the sums are carried from the Journal to the Leger correctly. 2d. That the additions of the accounts in the Leger are correct ; also those in the Journal. 3d. That the balances (or differences) of the accounts in the Leger have been calculated correctly. ^ Of course, a Trial Balance does not prove Journalizing. The prin- ciple of the Trial Balance is this : In every Journal entry, the debtor and creditor sums equal each other ; therefore, if those same sums are transferred correctly to the Leger, it is evident that the debitor and creditor balances taken from the Leger, ought also to be equal, there being no other sums in the latter than those contained in the former, and whatever is debtor in the Journal is debtor in the Leger. BUSINESS OF FEBRUARY: ing Good.-Ao«p^;g^Dr!ftr£?r. To William Blakeley.. $200 00 Cash ^100 00 ProfitandLoss iOO_00 200 00 Elucidation.—" Profit and Loss" is the name which our business re- ceives in our books. Our business, in this transaction, goes against us, and causes our losing $100 ; therefore it owes us, and consequently is debtor. Cash is debtor, because in it W. Blakeley has paid us half the debt he owed. JOURNALIZING. 29 W. Blakeley is creditor, because we owe him, he having paid us what he owed, and we having accepted half of his debt for the whole. The sum that Blakeley owed us befcye, Profit & Loss and Cash owe us now. Day-Book — February 12. The transaction of this date in the Day-Book gives the followino- en- try in the Journal : — ^ Merchandise Dr. To Sundries- .$1,240 00 To Charles Lawrence $ 140 00 " Bills Receivable 1,000 00 " Cash 100 00 1,240 00 Elucidation. — Merchandise has cost us $1,240, for which it owes us; and therefore it is debtor. C. Lawrence is creditor, because we owe him for having drawn on him for $140, which he vrill pay ; if not. the draft will be returned to us, and another entry will be required. We say nothing of the draft, because it is not in our favor, nor is it against us ; we do not owe it, nor does it owe us. The note which we held against O. Otis & Co., and which owed us, has now paid us what it owed, it having paid for us part of Haven & Smith's bill ; therefore we must credit the note under its former name «* Bills Receivable." Cash is creditor, because we owe that species of property for paying the sum of $100 for us toward this purchase. Day-Book — February 12 {2d Entry of thig date). The second transaction of this date in the Day-Book gives the follow- ing entry in the Journal : — William Blakeley «. Dr. To Bills Receivable $.500 00 Elucidation. — Mr. Blakeley is debtor, because he owes us for the aniount of his note which we hold against him, which is due and not paid. The note is creditor, because its time having expired, it has paid us by giving us a new claim on its author— W. Blakeley. NoTE.—When notes become due and remain unpaid, the best way is to charge their amounts to their drawers, or those who ought to pay them ; for It is then that those parties owe us. Before the notes were due, we could de- mand nothing of the persons ; the notes alone were responsible. Day-Book — February 13. The transaction of this date in the Day-Book gives the following en- try in the .Journal : — 30 JOURNALIZING. Merchandise Dr. To Sundries. .$6,633 11 To Walter Howard $4,888 89 " Bills Payable .• 1,222 22 ** Cash 422 00 6,533 11 Elucidation. — Merchandise owes us for the amount it has cost us, which consists of its first cost in London, the amount of duties, and the freight — the last two being paid here. W. Howard is creditor, because we owe him for the amount of the goods he sends to us according to our request. In changing the c£l,100 sterling to dollars, the dCl is calculated at the old par value — $4.44. We agree with many in thinking that a value nearer the true one should be used in transactions involving English money ; but it is difficult to change a custom. The present par value of the pound sterling is $4.84. (See calculations at the end of this book.) Bills Payable are creditor, because we owe our notes which we have issued against us, in payment of the duties : the notes pay the duties for us. Note. — Formerly, the revenue-law allowed credit on duties, and notes or bonds were taken at the customhouses ; but the duty on imports is now paya- ble in cash only. To Cash we owe, because it has paid the freight and charges on the goods for us. Cash, therefore, is a creditor. Day-Book — February 13 (2d Entry of this date). The second transaction of this date in the Day-Book gives the follow- ing entry in the Journal : — Sundries Dr. To Sundries. Bills Receivable $251 37 Profit and Loss 250 00 $501 37 To William Blakeley 500 00 • " Interest 1 37 501 37 Elucidation. — ^First, read the transaction carefully, with a view to find what owes you ; and whatever you think owes you, write it down as Dr. Then read again, to find what you owe ; and write that down as Cr. The draft or order drawn on S. H. Lovell, and accepted (agreed to), owes us for the amount it shows, including the $1.37 for interest. Our claim for the $251.37 consists in the draft, which must owe us until its time expires ; Lovell may then owe us, but he does not now. Our business, under the name of Profit and Loss, owes us, because it has been the cause of the loss we have sustained in this settlement with W. Blakeley. We owe to Interest, or Interest is a creditor, because that branch of our business has prodnred us $1,37, which sum is included in the note. JOURNALIZING. jj Wm. Blakeley is creditor, because we owe him for paying us what he owed-the balance of his account. He has paid us inVll, Although we have received only half, because we have accepted that half for t^ whole; he therefore must be credited for what he owed us. Day-Book — February 16. .ry?nTrut°aI :°I*" '"' '" *^ ^"y"^""'' ^ives the foUomng en- Walter Howard D,.^ To Bills Payable ^44^^ ^^ Elucidation.— In accepting this drafl we become responsible for its amount; therefore W. Howard owes us. To draw on ^s fs to order us to pay a certain sum ; and accepting the draft is agreeincr to do so Bills Payable, the name given to^he draft that we fave accepted are creditor, because we owe the draft which we have issued agaTnsf us'and which we shall pay at its maturity, in whosever possession^' may be ,^?A°'^^'^^^ ^^^^P' ? ^^^^* ^^ ^0 ^"te your name across its face. If the drafr reads so many days after sight, the date should be with the si^aJe, thus '^^ "Accepted, February 16, 1850. "Blanchaed & Marsh." Day-Book — February 17. Bills Payable Dr, To Merchandise *. ^^g^^ ^^ . ELuciDATioN.-The note, in this transaction, was issued by us some unae since, and held us responsible; now we have paid it, it owes us and becomes our debtor. ^ ' ^^' th^T^^^^^ '' the property in which we paid the amount of the note • therefore we owe it for paying our note for us. ' Note.— We have said, that when we pay a person a sum that we owed him he owes us, or becomes our debtor ; so, when we nav our no L fnrTifo ' reason it owes us, or becomes our debtor. ^^ ^'^' ^""^ ^^^ ^™^ Day-Book — February 20. Walter Howard Dr. To Sundries.. «2,974 29 To Merchandise ^2,730 00 ., S^''-.--. 160 15 Commission 84 14 2;974 29 Elucidation.— W. Howard owes us, because the goods were shinn.,^ at hiB request, or according to his order, he thereforl Ts deUor. '^'^ i i 32 JOURNALIZING. To Merchandise we are indebted, because we have sold it, and it has produced us $2,730, for which amount Howard owes us To Cash we are indebted, because it paid the amount of insurance and other expenses for us. , . ,^, .^ i v^nnntuh To Commission, as a branch of our busmess. we are indebted, because it produces us, in this transaction, $84.14. The amount of the creditor sums in the above entry ^quals the debtor sum-that is, the sum that Howard owes us As we have before said. the debtor and creditor sums will and must always be equal. Day-Book — February 21. The transaction of this date in the Day-Book gives us the following entry in the Journal : — Merchandise ^^' ..$1,530 00 To Merchandise E.»c.DAT.ON.-There are, in this transaction, two kinds of merchat. dise ; one we have bought, and f othe^we ha^e s^d That wh,^^^^^^^ IroWrX' r haT ;i:a: "on:"^d ■» aehto. and the Other is creditor. Dav-Book— Febboaby 21 (2d Entry of tM. d.to). The transaction of this date in the Day-Book gives us the following entry in the Journal : — Bills Receivable '^' ^gOO 00 T o Bills P ay able for the sum it is drawn for. S)^Sorse1b"M?. Bernard, and he endorses for us. Day-Book— Febbuabv 23. The transaction of this date in the Day-Book gives us the following entry in d>e Journal :- To Merchandise. .«1.620 00 S^"^^" . „ $500 00 Bills Receivable _ 120 00 Cash 1 000 00 1,620 00 James Truman ' — EL.cn>ATioN.-Here, as there are more than one debtor, we head them with the word " Sundnes." JOURNALIZING. Tr^ill"^^ Tl''•^^^^" '^^ '''^1 ^^^^" '^ '^^ "^^^^ t^at we hold against J. Iruman. This note ow€* «« $500. Cash owes us for the amount paid to us in that kind of property. J. Truman owes us, because the balance of the bill of goods sold to mm remains unpaid. % e **° °^^^ w «3'' ^f *^^^!;^^«e we acknowledge ourselves indebted, because it has produced us the sum of $1,620. Day-Book— February 24. en^JlnTeTo^r::;a°l 'l'" ^"^ '" "' ^'^y^'""' ^^^^ ^ *« «'"°-"g Sundries Dr. To Bills Receivable.. «2,000 00 k; •■• «1,969 00 ^'«=<""" 3100 2.000 00 ;s|e:^-Th^\?„?Scirrn:^^^^^^^ Elucidation.— Cash owes us, because the sum the bank has naW ... Th^'Zl l'^ ''"•j""' '? *^ transaction. $31 , therefore it owes us ,J, nT. t ^ P'"^ "l*S """^ '' '"'^^ ; therefore it is a credkor Al Day-Book— February 25. en5ln?hrjoi:'r:af:l''' ""'' '" *« ""^y^^ g-" - *e following Schooner J^ephine Dr. To Sundries.. $5,000 00 To Walter Howard $2.228 22 .. Exchange ^^ .^g " 2,600 00 5,000 00 cosf u"T5:o"o~~'''' "'""'"''^ °"^'' -^ ^ — e ^he has $2^2 ir T^'^"" *° ^- Howard, because we have drawn on him for Sf pay'ir.^^rrmPru"; '^ " "'•^^^ •^'- "^ --- -^ « -rf"- ted^:^y:h-i:::^ -ru:$'5r.^r^:;^ tstbrf exchange, at a premium, which we consider a ^in Js?ng from the 34 JOURNALIZING. advantageous position of funds. The premium goes to Capt. Davis, in part payment of the schooner. Cash is creditor, because we owe it as a property for pavintr nan of the $5,000. ^ J bf Note 1.— Sometimes the gain or loss, arising from the sale of drafts or bills of exchange, belongs to the one who draws, and sometimes to the party drawn on, or remitted to : this depends on who placed the funds to draw against, and other circumstances. In this series of transactions, we shall suppose the pre- mmm, or discount, to be the gain or loss of the drawer, unless otherwise ex- pressed. Note 2.— It should be understood that, when we see it stated that exchange on England is at 8 or 9 per cent, premium, it is really only about par. The premium, being calculated on the old par value of $4.44 to the £, must include, under the name of premium, the difference between the nominal value ($4.44) and the true value ($4.84)— about 40 cents. Day-Book — February 26. The transaction of this date in the Day-Book gives the following en- try in the Journal : — William Evans Dr. To James Truman $1,000 00 Elucidation. — ^We receive an order at sight on Wm. Evans, who accepts but does not pay it ; and the order being due, it is charged in account by mutual consent. Evans owes us, because the order is due and not paid. To J. Truman we owe for the amount of the order he has given iis on W. Evans. Note.— We see in this transaction, also in the one of the 25th, an impor- tant paper received in one case, and delivered in the other, which makes no part of the Journal entry : the reason is, that these papers do not owe us, nor do we owe them. Do not, therefore, trouble yourself with any such rule as. " What you receive is debtor to what you give." Day-Book — February 27. The transaction of this date in the Day-Book gives the following en- try in the Journal : — Shipment to Port au Prince Dr. To Sundries- .$3,908 00 To Merchandise $1,200 00 " Bills Payable 2,190 00 " Charles Lawrence 288 00 *• Schooner Josephine 230 00 3,908 00 Elucidation. — The shipment or consignment owes us, because it has cost us the amount of the variou? items of which it is composed. To the creditors, being more than one, we give the preface of " Sun- dries." H. B. Walker & Co., to whom the goods are consigned, do not owe us, because the goods aie still ours. TRIAL BALANCE. 35 To Merchandise we are indebted for contributing toward the ship- ment the sum of $1,200— which goods are taken from our store. To Bills Payable we owe for the amount of our note given to Dallet & Co., in payment of our purchase of them. To our schooner we owe for the value of the freight (calculated in ad- vance) on the goods, which she has produced or saved us. Day-Book — February 28. The first transaction of this date in the Day-Book gives the following entry in the Journal : — =» s Shipment to Port au Prince Dr. To Sundries. .$201 56 To Bills Payable $ 81 56 " Cash 120 00 201 56 Elucidation.— The shipment owes us, because it has cost us for the insurance, and for various expenses in shipping the goods. Bills Payable are creditor, because we owe our note, given to the in- surance company in payment for the premium or cost of insurance. Cash 18 creditor, because we owe it for paying for us the expenses. Day-BooK — February 28 (2d Entry of this date). The second transaction of this date in the Day-Book gives the follow- ing entry in the Journal : — Schooner Josephine Dr. '^^Cash ^26 00 ELUcroATiON.— The insurance is an expense on the schooner, and she owes us for it ; therefore she is debtor. Cash is creditor, because it was cash that paid the insurance for us. TRIAL BALANCE. Having Journalized the transactions of February, the pupil will now proceed to post— that is, to enter in the Leger from the Journal, as ex- plained at the end of January. When the posting is finished, he will make a Trial Balance. In adding the accounts in the Leger, the sums of January must be mcluded. The following is the Trial Balance of the Leger at this date : — 30 Dr. TRIAL BALANCE. Balances of February 28, 1850. JOURNALIZING. 37 Cr. 2 4 5 6 7 8 8 11 12 13 16 16 Cash $31,120 2,905 8,987 300 4,951 65 350 200 250 307 1,822 4,109 53 89 37 00 00 00 00 00 00 62 22 56 19 1 1 6 7 9 9 10 14 T.Blanchard C.C. Marsh Bills Payable Discount and Int'st. Commission Exchange C. Lawrence W.Evans $26,920 16,705 10,838 96 84 177 288 260 00 00 22 05 14 78 00 00 • 19 Merchandise Bills Receivable Store-Fixtures Schooner Josephine Store-Expenses . . . Profit and Loss . . . O. Otis & Co S.H.Lovell W.Howard Shipment to New > Orleans \ Shipment to Port } au Prince \ 55,369 55,369 BUSINESS OF MARCH: Embracing Entries of twenty-six Transactions, relating to — Delivering per Order— Receiving Consignments— Paying Charges on Consignments— Selling Consignments — Selling at Auc- tion — Collecting Notes and Acceptances — Receiving Notes with Interest — Allowing for Damages in Sales — Paying Acceptances — Closmg Consignments— Rendering Account-Sales -—Receiving Account-Sales — Buying in Joint-Account — Selling in Joint-Account — Receiv- ing our Note before Due— Paying Money to a Partner— Buying Bills of Exchange — Closing Account of Sales in Joint- Accoont — Rendering Account-Sales of Merchandise in Joint-Ao> coiut THE RULE. Every person and thing that owes us\s Dr. Every person and thing that we owe is Cr. The best method of applying the above rule, is the following : — First, understand welljthe nature of the transaction, make yourself familiar with its details, consider yourself the person that performs it or to whom it occurs, and then ask yourself — Who or what owes me ? And write down the answer as the Dr. Who or what do I owe 1 And write down the answer as the Cr. The sums that belong to these answers are those that the person or thing in reality owes us, and those that we owe. Day-Book— Transaction op March 2. ELUCIDATION.--C. Lawrence owes us in this transaction, because on his order we delivered the goods to W. Blakeley. Merchandise is creditor, or we owe to Merchandise, because it nm duces us value to the amount of $288. because it pro- thn^L? "^^P^y ^ ^^^^ai" «""^ by order of any person, it is evident that promise to pay us its sum at any future time. Day-Book— 2d Transaction op March 2. The transactions relative to which no exnlannM'r»«o «,.« • e dered sufficiently simple not ,o X^CtZ^l^iJ'Z'Z^^ studied with attention those of January and Februiy ^^ * DAy-BooK — Transaction op March 3 Cash IS creditor, because in it we paid the freight a^nd dmies siZ to" ""mimtF." """"^^ '"' ""^ ="<'""' °f "'« g-ds he con- signs lo us (9d,im), because we do not owe him that c,™ ti, j are still his; we have neither bought nor orferS them Tn'^ 3 ^"^^ owe a person for what remains h.l When wrhave ^old .hT ''*""°' ment and rendered to him an account of thTsaCthen we ma^Te" him the net proceeds, but not before. ^ ® Day-Book— Transaction op March 5 the'^etreTashTde-bt:": ""^ ^^ "'^^ ^--^^ '-« ac:5a„ce owed; The acceptance haVing paid us what it owed us, becomes a creditor. Dav-Book— 2d Transaction op March 5. !« f7n"n''"'*J'r-~^''->'Tf °f O. Otis & Co.'s account, in our favor IS 8700, which is considered due in cash • therpfA~ ;,.„•• ' at sixty days, it should be drawn for t^e sumThfr^i, be^dTe'^rxV^C crelt:* W ' Thn *°"" ^^'"''f •"^«^-' coirespondinrtol credit or time. The note owes us for the said balance, and also for th^ anwunt of mterest j for both of which it is drawn or written. Interest is creditor, because we owe it for producing us $7.35. 38 JOURNALIZING. I Note.— When Interest is in our favor, it is a creditor, because we owe it for the value it produces. When it is against us, it is a debtor, because it owes us lor the sum it costs us. To O. Otis & Co. we are indebted for the balance of their account, which they have paid us in their note ; for which balance the note is now our debtor. Day-Book — Transaction op March 7. Elucidation. — In this transaction, we agree to an allowance in favor of C. Lawrence, on a purchase of a former date. The amount of the allowance we do not pay ; therefore we owe him, and he becomes a creditor for the same. Day-Book — Transaction op March 9. Elucidation. — The acceptance now paid received the title of " Bills Payable," when we accepted it (February 16), since which time it has stood out against us as our note. This acceptance now owes us, be- cause we have paid it what we owed it. W. Howard does not owe us in this transaction, because the drafl, now paid, was our acceptance. At the time we put our name on it, he began to owe us, and then became our debtor. Day-Book — Transaction op March 10. Elucidation. — Commission owes us nothing in this transaction, be- cause in reality we sell the goods for only the sum that we receive for them— being the net proceeds, $1,233.27 ; for which sum Cash owes us, and we owe to the consignment. Note.— It is not necessary to give, in the Day-Book, the particulars of the quantity, quality, and prices, of goods sold— these belong more to the Sales- Book than the Day-Book ; but as it is not thought necessary to continue the Sales-Book beyond a few examples, the former book is rendered more complete by its embracing some description of the goods sold, particularly when those goods are not ours. Day-Book — 2d Transaction of March 10. Elucidation. — To receive merchandise to our account, means that we have bought it, or taken it as our own. And now, since the olives are ours, we give them the title of Merchandise ; and as they owe us, we call them debtor. To the consignment we owe, because it has produced us the olives, or their value. Day-Book — Transaction op March 12. Elucidation. — The merchandise, or olives, sold to P. Harris in this entry, does not belong to the consignment of De Nones, having been made ours in a previous entry. JOURNALIZING. 30 Day-Book — Transaction op March 14. Elucidation. — In order to ascertain the amount of the sales of this consignment, and to see if it agrees with the Commission Sales-Book, it is necessary to post all the sums belonging to the consignment, from the Journal to the Leger, and to compare the Leger account with the ac- count in the Sales-Book. The entry under this date in the Day-Book shows that we have made an " Account-Sales" of the goods belonging to J. De Nones, for the purpose of closing the account of those goods, and transferring the bal- ance to accounts where it more properly belongs. In Journalizing this entry, we say that we owe to the following : — To Commission we owe, because it is a branch of our busi- ness, and which has produced us $215 71 To Store-Expenses we owe, because that branch of our business has produced us the amount of our charges for storage, &c • 52 24 To Joseph De Nones we owe for the net proceeds of the goods we have sold for him 3 531 32 Amount that we owe 3 799 27 which makes the balance of the account. . Now, then, the consignment must owe us, and become debtor for the balance that appears on its credit side, because we divide said balance, and carry it to the credit of the different accounts above expressed. This last entry, when posted, will close the consignment. The "Account-Sales," which we render to J. De Nones, will be found among the Forms, at the end of this volume. Day-Book — Transaction op March 16. Elucidation. — Lockhart & Arrott owe us for the amount of the net proceeds of our shipment to them, they having sent us%n account of the sales without remittance of funds. " Shipment to N. Orleans" being the title we gave the goods when we shipped them, we should now, in speaking of that property, use the same name. Shipment to New Orleans is creditor, because we owe it the sum it has produced us, and for which L. & A. are responsible. •■^^^u *t5^'"® ^® ^*^® *^6 ^™e transaction as that of the previous entrv witn the difference only, that in one case we send away an " Account-Sales '» and in the other we receive one. ' Day-Book — Transaction op March 18. Elucidation.— Cash owes us for the sum that P. Harris has advanced to us ; and we owe him, because we have not yet used the money for the object for which he gave it to us. p¥f I 40 JOURNALIZING. Day-Book — Transaction op March 20. Elucidation. — We give the title of " Merchandise Company 1," or ** Company 1 Merchandise," to the flour which we have bought in joint account with Mr. Harris — a name to distinguish it in our books from goods that belong solely to us. The flour does not owe us for its whole cost, but only for the cost of our half of it— $2,000 : it is not responsible to us for Mr. Harris's half, or what it costs him. P. Harris owes us for his part of the purchase, because we paid for his part of the flour. Day-Book — Transaction of March 21. Elucidation. — The flour costs us only half of the amount received, and it can owe us no more than our interest in it — $1,187.50. We have received twice that amount ; but Journalizing is not to show what we receive or deliver, but what are our debtors and creditors. Mr. Harris is creditor, because we owe him for our half of the flour : he furnishes our half for us. Were we to credit Mr. Harris for all this flour, we would be making the same entry as if we had bought it all of him ; which is not the case, because, it being on joint account, half re- mains his. It being in our store makes no difierence in the prpprie- torship. Day-Book — Transaction op March 23. Elucidation. — In the transaction of this date, we receive our uwn note in part payment for the flour ; and as the note is not due, we are allowed discount for the time it wants of being due. Discount is therefore in our favor, and must be credited for what it produces us — $9.10. Bills Payable owes us for the amount it was drawn for — $2,100 — al- though we do not give that sum for it, yet with what we give we pay the whole. The flour, under the name of " Company 1, Merchandise," is cred- itor, because it produces us $3,000. Note. — Accounts of merchandise in company, or in joint account, generally show on the debtor side onlv half of the amount purchased, while on the credit side they show the total sales. This may appear irregular, but it is not so. The propertjr can not be debtor (that is, owe us) for more than our inter- est in it, nor can it be debtor in our books ior what it may have cost the other partner. But when we sell the goods, they produce into our hands the total amount of the sales, and consequently we have a very good reason for credit- ing them for the same. Day-Book — Transaction op March 26. Elucidation. — The bill of exchange, which we have bought for the purpose of making a remittance to London, owes us for its face only, and not for the premium we have paid on it. Exchange, as a branch of our business, owes us for what it has coit JOURNALIZING. 41 us — being, in this case, the difference between the old par value of the c£, and the amount the £ in Liverpool, sells for here. Note.— It should be borne in mind, that the premium here paid is only an apparent premium— a premium on the £1 at $4.44. If bills on England were bought or sold by the rate of $4.84 as the par value, the exchange in the above transaction would be at a discount, instead of a premium. When we buy a bill of exchange, it is for the purpose of placing funds at some distant point, without the necessity of remitting specie or merchandise. It is the method of remitting generally preferred, provi- ded the rate of exchange be not too high. Day-Book — Transaction of March 27. Elucidation.— Wm. Evans owes us for the amount of the order, which bein^ at sight, and accepted, brings him immediately into our debt. It is agreed that it shall be passed to his account, instead of being paid in cash, because by former transactions we are owing him. Day-Book — Transaction op March 30. Elucidation. — Before making the closing entry under this date, all the entries in the Journal, relating to the Company 1 Merchandise, must be posted, and the sums on the credit side of the account examined in the Day-Book, in order to see if they are actual sales, or only transfers. This done, we make the following calculation, which is the origin of the Day-Book entry of March 30th : — Total sales (amount of the credit side of the account) $7,850 00 Storage charged by us, and any other charges against the goods if we had them $ 39 OO Our commission for selling, at 2 J per cent 196 25 Amount of the expenses on the flour 235 25 which we subtract from the total sales, and which gives us the amount of the net proceeds 7 614 75 Half of which belongs to Mr. Harris 3,807 37 And our half is '[[[ 3^807 38 From this we take the cost of our half (found on the debtor side of the account), which is 3 187 50 Showing our net gain in this business to be 619~88 Having explained, as above, the origin of the Day-Book entry, we proceed now to show how it is to be disposed of in the Journal :— ' To Commission we owe for producing us $196 25 To Store-Expenses we owe for producing us 39 00 To P. Harris we owe for his half of the net proceeds of the flour in our hands 3 g^y 37 To Profit and Loss (name of our business) we owe for our half of the net gain gin go Total that we owe 4 662 50 6 ■- 42 TRIAL BALANCE. I J ' i. '* This should be the balance of the account of Company 1 Merchandise, because we can owe no more or less, after making the above calcula- tion, than we did before ; but we may owe different objects. Company 1 Merchandise is debtor, because it owes us for the amount we transfer from its credit to the credit of other accounts, where it more properly belongs. We ought to make this transfer of the balance, because the goods have all been sold, and the preceding calculation shows us that we owe that balance to others. The " Account-Sales" of this flour, made out to be rendered to Mr. Harris, will be found among the Forms at the end of the book. TRIAL BALANCE. The student will now, having posted all the entries in the Journal, proceed to make out the Trial Balance of March 30, in the manner ex- plained at the end of January and February. The following is the Trial Balance, showing the balances of the ac- counts at this date : — Dr. Balances of March 30, 1850. Cr. • 2 4 5 6 7 8 9 10 12 13 14 16 Cash $28,787 4,596 fl,392 300 4,951 18 177 165 395 307 2,020 4,109 33 39 79 00 00 76 78 00 00 62 00 56 23 1 1 6 7 8 9 11 14 16 T.Blanchard C.C. Marsh Bills Payable Discount and Int'st. Profit and Loss Commission P. Harris J. De Nones Shipment to Neii^^ Orleans Tj $26,920 16,405 4,293 112 269 496 4,994 3,531 197 00 00 78 50 88 10 87 32 78 23 Merchandise Bills Receivable . . . Store-Fixtures Schooner Josephine Store-Expenses . . . Exchange C. Lawrence S. H. Lovell W.Howard Lockhart 6c Arrott. Shipment to Port ) au Prince J »5 57,221 57,221 JOURNALIZING. 43 BUSINESS OF APRIL: Embracing Entries of forty Transactions, relating to-Paying Rent-Receivine Retnm*- Wmng Consignments free of Charge^SelliSg on Comlission-Renewrg Note^^ tl^l^ ourselves for Damages-Shipping, on our Account-Closing Consignmlnt-Buvine in Jomt-Account-Exehanging Uncurrent Money-Renewing our Notes-Ssferrine Puf cha^ at Auction-Drawing Prize- Receiving Account-slles with ^etul^^^Takb. a Consignnient to our Account-Receiving Freights of our Vessel-Drafts remitt^as for Col ^io^^?r/'°^ ^r^'" P"' ^'^'' ^^ '"^•- i^«™i"ance-Investing FundsTn Ss-S^v^^ fo^un^^c^c!!?e"e;LVr^s;&^^^ THE RULE. Question yourself, in every transaction, thus : What owes us ? For that alone is Dj. What do we owe? For that alone is ii""!!!!!!'!!cr Day-Book — Transaction op April 2. Elucidation— The cotton that we receive, in this transaction, owes us as much for the freight as for ite first cost in New Orleans. It is there- fore debtor for $2,320. ^ • xt i» inere- To Lockhart & Arrott we are indebted for the amount of the cotton S'fnT vIII^a'^^^"'^-.™" ^"^^^^^ '' ^^^^^^« for a shipment made to Lockhait & Arrott, February 4th ; but we do not owe and credit the shipment m this transaction, because it was credited when we re- ceived the account-sales, March 16. Day-Book — Transaction op April 3. ELUCiDATio%In this transaction, there is neither debtor nor cred- itor ; that is, nothing owes us, and we owe nothing. We can not, there- fore, make any Journal entry. The coffee still belongs to Mr. Fisher We have not bought it of him, nor agreed to pay him a certain sum- therefore we can not owe him for the coffee, nor credit him for it The coffee has not cost us anything, nor is it responsible to us for any ex- penses ; therefore it is not debtor. ^ There is no necessity for this transaction appearing in the Day-Book • but the invoice should be copied into the Invoice-Book, and Mr^FbW Im^lsL]"" "" ""'"'^' '' '^" quantity of coffee recdved of hhJi on Day-Book — Transaction op April 7. ELticiDATioN.-We say nothing of Bills Receivable in the transaction of this date, because the circumstances of the note have not changed. It still owes us the «2,000, for which we made it debtor when it began to owe us — January 5th. ° »( 44 JOURNALIZING. The new note should be entered in the Bill-Book, and against the old one should be remarked, that it was renewed. (See Notes Nos. 1 and 15, in the Bill-Book.) It is customary, in renewing notes, to draw the new note for the same amount as the old one, and to pay the interest on the new note in advance, for the time it may have to run. Day-Book — 2d Transaction op April 7. Elucidation. — Mr. Fisher owes us for the sum we have paid him on ?»ccount of the proceeds of his coffee. We shall owe him the net pro- ceeds when we render the account-sales. To Fisher's consignment we are indebted for producing us the $1,440 paid to Mr. Fisher. If we had made two entries of this transaction in the Day-Book, Cash would appear as both a debtor and a creditor. Day-Book — Transaction op April 10. Elucidation. — Mr. De Nones owes us for the amount of the defects found, and allowed, in goods sold for him. We say nothing of the con- signment in the Journal entry, because that has been closed, and the net proceeds transferred to his account. Merchandise is creditor, because by that name we called the olives when they became ours, and now they have produced us the amount we claim as deduction in the price we took them at. Day-Book — Transaction op April 11. Elucidation. — Mr. Fisher owes us for the amount we have paid him — ^that is, $1,350 : $1,322.33, four months before due, is equal to $1,350, allowing us interest for four months and three days. Bills Receivable, or the note of S. H. Lovell, owes us now for the sum that he owed us before, because in that kind of property he has paid us. Discount is in our favor : it produces us $27.67. We discounted the note for Mr. Fisher. Day-Book — Transaction op April 16. ^ Elucidation. — Before we can make the Day-Book entry of this date, all the sums for which the " consignment" is debtor or creditor in the Journal, must be posted to the account in the Leger. On the credit side we see the amount of the sales — $4,680 ; from which subtracting all the expenses, leaves the net proceeds $4,545. By this calculation, we discover that the balance of the account (which is the total of the credit side in this case) is $4,680, and that we owe this sum to the following, to which we must now transfer it : — We owe to Commission for what it produces us $117 00 We owe to Store-Expenses for what they produce us 18 00 We owe to J. Fisher for the net proceeds of his coffee 4,545 00 Making the total of the Cr. side, or the balance of the acct.. 4,680 00 JOURNALIZING. 45 These now become our creditors instead of the consignment, and this must be charged for the amount that we transfer, which will close the account of the consignment. Day-Book — Transaction op April 20. Elucidation. — The merchandise bought in joint-account with Mr. Austin, in this transaction, owes us for the amount it has cost us — that is, for what our two thirds cost, $3,333.33— and for no more. The mer- chandise can not owe us for what it has cost Mr. Austin. We say nothing of Mr. Austin iri the Journal entry, because we have paid nothing for him, nor he for us. Note.— Never permit the mere circumstance of receiving or delivering merchandise to divert your attention from the true and only practical Rule. By this rule alone can you prove the correctness of a Journal entry. There are various other transactions, besides this, in which the object that is received IS not our debtor^ and that which is delivered is not our creditor. See the transactions of the 4th, 12th, 25th, 26th, and 27th of Februarv, 2d, 3d, 16th, ^^\\^\^i' ^°.^ ^"^'^^ °^ ^''^<^^' ^"<^ 3d of April. In all these 6ases, if the old rule ("The thmg received is Dr. to the thing delivered") should be applied, the Journal entry would be grossly wrong. Also, the old rule never can be ap- plied to mterest, without making a wrong entry. Day-Book — Transaction op April 24. Elucidation.— To renew a note, is to pay it by giving a new note for the old one ; and as the new is generally drawn for the same amount as the old. It 18 customary to pay the interest that may arise on the new note, m advance. Day-Book — Transaction op April 28. Elucidation.— As we receive the account-sales of our shipment to Messrs. Walker & Co. at the same time we receive the returns, we owe the "Shipment to Port au Prince" for the net proceeds, and not Walker, because the shipment now produces us $6,000. If these returns had not been accompanied by the account-sales, then we should owe and credit Messrs. Walker & Co. for the invoice of hides, rihe freight composes a part of the cost of the hides ; therefore thev are debtor for the $200 as well as the $6,000. We owe our schooner for the value she produces us in freight. Day-Book — 2d Transaction op April 28. Elucidation.— The expenses on the mahogany were incurred while It belonged to Messrs. Walker & Co.; therefore we deduct them from the amount at which we buy the mahogany ($3,000), leaving the net proceeds of $2,650, which we owe to the consignors. The mahogany owes us for its cost, which is $3,000. Day-Book — 3d Transaction op April 30. Elucidation.— The bill of exchange that we have bought, in this I 1 46 JOURNALIZING. transaction, does not owe us, because we have bought it by request of. and remitted to, Messrs. Walker & Co. : they owe us We owed Messrs. Walker & Co. $2,650, which we will suppose was due them here (in New York city) ; and we have, by their order, invested that sum (less our commission) in a draft drawn for as much as the funds would buy. Day-Book — 4th Transaction op April 30. ELuciDATiON^In this transaction, we buy a bill of exchange, and remit it to Mr. De Nones, in payment of what we owed him— 1^3 469 32 Let us suppose that this debt was payable to him in Cadiz : we then have only to buy a draft for which he will receive that sum. If we give for the draft less than that sum, the gain by exchange or discount is ours, not his; if, on the contrary, the exchange on Cadiz is at a .iremium, the loss would be ours, not his. (It is necessary to know wh^e the money 1^1, J ^^P^y^f ^®' ^" °^^^^ ^o '^"ow who gains or loses by the exchange.) Ihe draft we have bought has cost only $3,402.98; but Mr. De Nones vvill receive for it $3,454.80, which sum, with the interest for 25 days that It wants of being due, will make the sum that we owed him—- $3,469.32. In Journalizing this transaction — We owe to Exchange, because it is in our favor, and produ- ces us the discount on the draft $51 §2 We owe to Interest, because it brings us .* .. 14 52 We owe to Cash for paying for the draft * . * 3,402 98 Making the sum which Mr. De Nones owes us, and is "" debtor for, in this transaction 3,469 32 Note.— Had this debt been due to Mr. De Nones in this city, instead of Ca- diz, we could charge him only for the cost of the draft, and not for what it was drawn ; and then we should have nothing to say in the Journal, of exchanffe l»ecause it would neither produce us nor cost us anything. Day-Book — 5th Transaction op April 30. ELuciDATioN.—In this transaction we buy, with funds in our hands belonging to Mr. Ruiz, a bill of exchange on Havana ; and we pay for It according to the rate of exchange, which we may suppose to be 11 per cent, discount. In this way. we receive a draft for $5,050.63, for which we give only $4,974.88. which, with our commission, makes up the amount of funds we held for Mr. Ruiz — $4,987.50. Mr. Ruiz owes us, in this case, for the amount we paid for the draft, and for our commission, but for no more. Exchange costs us nothing, nor do we gain by it ; it being in favor of Mr. Ruiz, who will receive a draft for a larger sum than he would have received, had the exchange been at par. Day-Book — 6th Transaction op April 30. Elucidation.— In this transaction, we only exchange one kind of money for another ; and as we pay a premium on that we roceive, we TRIAL BALANCE. • ^ Bay Exchange owes us for what it has cost, and we owe to Cash for pay- ing It for us. " * Dav-Book— 7th Transaction op April 30. Elucidation.— This entry is made for the purpose of creditin? each S«ed inlf^i:,: '"f '=''P'*^1-""^ 'l-^ « Wosition'that it" ^aT o siipmated m the articles of agreement between them. To arrive at th^ mterest that may be due a partner on his capital, we make ow his " ac rfr,r-i ^rj"""'"^ ""^^ ""^ f"^ Mr. Harris, calcJatng inter! due. bee the " Account-Current" made out for Mr. Marsh amon„ try are obtained trom the accounts-current. viduaW^h!' fi °^ '^"a T"^' ""^ '"y '^^' ^^ (^^ fi^) o^« to the indi- viduals ot the firm, and that mterest owes us. Day-Book— 8th and 9th Transactions op April 30. Elucidation.— The sums of these entries are obtained from the acrmmfc current, made out for Mr. Harris and Mr. Lawrence which will l? ^r ^ among the Forms at the end of the book. The emrrrelSfto M^^ Harrisfs journa ized wrong ; but the error is corrected by the last entrl in thl'^olf ^ i under date of May 30. This furnishes an exar^ple for he c^^^^^^^^ by, day-book entries, which should be resorted to only Xn thfaccount Z taming the error has been closed ; in other cases it is^better to change th^^ ores to ciphers, let the words remain, and make a new entry. ^ ^ Dr. TRIAL BALANCE. Balances of April 30, 1850. Cit. 3 4 5 6 7 7 8 10 12 13 16 18 Cash Merchandise Bills Receivable . . . Store-Fixtures Discount and Int'st. Schooner Josephine Store-Expenses . . . C, Lawrence. . . . . . S.H.Lovell W.Howard Shipment to Boston Company 2 Mer- / chandise \ $26,274 11,437 6,998 300 61 n 4,126 662 167 395 307 3,500 3,333 58,114 07 14 35 00 27 00 76 07 00 62 00 33 61 1 1 6 8 9 9 10 16 16 T. Blanchard C.C. Marsh Bills Payable Profit and Loss . . . Commission , Exchange , P. Harris Shipment to New J Orleans ^ Shipment to Port \ au Prince v $26,870 16,702 4,] 37 2,379 794 15-: 4,988 J 97 96 69 11 88 85 70 20 78 1,890 44 58,114 61 48 BALANCE SHEET. BALANCE SHEET. It is customary, in well-regulated mercantile houses, to close all the accounts, or balance the books, once a year. The object of so doing is to obtain a correct view of the true state and result of the business of which the books give the records. Accounts, however, are closed or balanced under other circumstances — upon a cessation of business, dis- solution of partnership, and when the books are full and there is occa- sion for new ones. The first object to which we direct our attention, in closing the books, is the Balance Sheet. This sheet exhibits, under two heads, the entire re- sult of our mercantile operations. Under the heading of " Balances of our Property and Dehts" (or. Assets and Liabilities), are brought to- gether all that owes us, and that we possess, and all that we owe or are liable for; under the heading of '* Balances of our Profits and Losses'* are shown all the balances of gain or loss that may be found in the Leger ; and consequently the balance of one will be the net capital, of the other the net gain. The Balance Sheet is chiefly composed from the Leger and an in- ventory of the merchandise on hand belonging to us, which should be taken at the cost price, or less, if the goods are depreciated in value, but never at more than cost. Take a sheet of paper, and make on it the following headings, similar to the succeeding Balance Sheet : — " Balances of our Property and Debts," and " Balances of our Profits and Losses." (Explanation of the Balance Sheet continued on page 52.) / BALANCE SHEET OF AJfRlL 30, 1850. Blanchabd & Marsh V r Dr. Balances of our Property and Debts. Cr. 3 4 5 6 7 10 10 13 16 18 Cash, Merchandise, Bills Receivable, Store-Fixtures, Schooner Josephine, Charles Lawrence, S. H. Lovell, Walter Howard, Shipment to Boston, Comp'y 2 Merchandise, cost of our two thirds on hand balance on hand balance on hand per Inventory balance on hand valued at first cost balance in our favor balance in our favor balance in our favor no account-sales $26,274 15,000 6,998 270 5.000 167 395 307 3,500 3,333 61,245 07 00 35 00 00 07 00 62 00 33 44 Dr. Balances of our 6 Store-Fixtures, loss 10 ®|o on the cost 7 Discount and Interest, loss 8 Store-Expenses, loss Thomas Blanchard^s C. C. Marshes •. half net gain $4,273 24 half net gain 4,273 24 Net gain 50 6 10 Bills Payable, Paul Harris, Thomoi Blanchard's C. a Marshes balance outstanding balance in his favor . share of capital . .$31,144 20 s?iar€ of capital . . 20,975 93 Net capital Profits and Losses. 4 7 8 9 9 16 16 Merchandise, Schooner Josephine, Profit and Loss, Commission, Exchange, Shipm*t to N. Orleans, gain Shipm't to P. Prince, gain New York. April 30, 1850 Cr. 51 ! II «l- BALANCE SHEET. EXPLANATION OF THE ENTRIES ON THE BALANCE SHEET. This being done, turn to the first account in the Leger, and, by re- flecting on its nature, endeavor to determine on what part of the iheet its balance should be placed. The first two accounts that we find are those of the partners, from which we take nothing at present, because their balances are what r^ mains of the old or original capital. 3 The Cash account (folio 3) shows on its debtor side all the mone.T wo% have received, and on its credit, all we have paid. It is therefore clear, that the balance or difference between the debit and credit, is the money on hand. Cash is a property that owes us $26,274.07, which sum we will enter on the debtor side of the Balance Sheet, under the head of " Property and Debts." The account of Merchandise (folio 4) shows on its debtor side the cost of all the goods we have bought, and on its credit, the product of all the sales. The cost of our merchandise on hand, according to the inventory (which we now suppose), is $15,000. This property, merchandise, owes us that sum, and we enter it on the debtor side, under the head of " Property and Debts." We must now calculate the^ gain or loss on the sales, which is done by adding the amount of the merchandise on hand to the amount of the sales, thus : — Amount of sales, total of the creditor side $24,619 47 Amount of merchandise on hand, per inventory 15,000 00 39,619 47 Cost of all the merchandise, total of the debtor side 36,056 61 By subtracting, we find the gain on the sales 3,562 86 This gain we enter on the creditor side of the part of the sheet headed " Profits and Losses." ^ Note. — There is another way of finding the gain on the saSes, when the ac- count is in a similar s ate, which is, by subtracting the balance of the account from the amount of the inventory, thus : — Inventory $15,000 00 Balance of the account 11,437 14 Gain on the sales 3,562 86 If there had been no merchandise on hand, the balance of the account would then be either gain or loss. The account of Bills Receivable (folio 5) shows that we have in our possession notes to the amount of $6,998.35. This property owes us, then, this sum ; and therefore we enter it on the debtor side, under the head of " Property and Debts." The account of Bills Payable (folio 6) shows that there are notes and acceptances out against us, to the amount of $4,137.11; and as that is a BALANCE SHEET. 53 ■^M Bum we owe, we enter it on the creditor side, under the head of Prop- U » erty and Debts. This balance, as well as the preceding, ought to cor- ^ ^ respond with the notes out, and on hand, in the Bill-Book. V The account of Store-Fixtures (folio 6) shows that this property has ^ ^ cost us $300 ; from which sum we deduct 10 per cent, for the wear, and place the balance ($270) on the debtor side, under the head of " Prop- erty and Debts :" and the $30 loss we enter under the head of " Profits and Losses," on the debtor side. The account of Discount and Interest (folio 7) shows a gain or a loss. If the creditor side exceeds the debtor, it is evident that this branch of our busingp has produced us more than it has cost, and that the balance is gain, liiis" balance is a debt owed to us ; but as we never can real- ize it, it is evidently a loss, and consequently we enter said balance un- der the head of " Profits and Losses," on the debtor side. The account of Schooner Josephine (folio 7) shows both property and profit or loss. Her first cost is $5,000, which we will take as the amount of property, and enter it on the debtor side, under the head of " Prop- erty and Debts." The creditor side of this account shows what the schooner has produced us for freight — $1,055 ; from which we deduct the expenses on the debit ($181), and the result is the gain, which we enter on the credit, under the head of " Profits and Losses." The account of Profit and Loss (folio 8) represents our business : if the debtor side exceeds the credit, tfce balance will be loss ; or, if the credit exceeds the debit, the balance will be gain. The balance, in this case is gain, which we enter under the head of " Profits and Losses," on the credit side. Store-Expenses (folio 8). This account does not show property, but a branch of our business ; and the balance which appears at it is either gain or loss. Store-Expenses owes us, but they will never pay wha* they owe ; therefore the balance of this account should be entered under the head of " Profits and Losses." The account of Exchange (folio 9) shows a sum of gain, because its credit side exceeds the debit — that is, this branch of our business has produced us more than it has cost ; therefore we enter the balance on the credit side, under the head of " Profits and Losses." The account of Commission (folio 9) represents a branch of our busi- ness ; consequently we enter its balance under the head of " Profits and Losses." The account of Charles Lavrrence (folio 10) shows a balance against him, and in our favor, of $167.07 ; and as we consider him solvent, we place it on the debtor side of the sheet, under the head of " Property and Debts." ^ ^ The account of Paul Harris (folio 10) shows a balance in his favor, which, being a sum that we owe, we enter on the credit side, under the head of " Property and Debts." The account of O. Otis & Co. (folio 10) shows no balance, it having been balanced or closed in the course of the business. The account of S. H. Lovell (folio 12) shows a balance in our favor, and as such we enter it under the head of "Property and Debts," as the debit. dfl&fe 54 BALANCE SHEET. favir of'^T fif "^^'u ^°^^'^ (^°^^^ ^^J^ ^""^^^^ ^ balance in our ''Prop^^^^^^^^^^^^ "^ ^^'^^ ^" '^^ ^^^^^ «^^^' -^- the head of it«Tr«^rr''' ^Shipment to Boston (folio 16), not having any sum on te credit, shows that we have not received an account-sails- therefore the amount of its debtor side is property which we have in Boston W^ Debts." ^"'°'"'^ """ ' "''^^'" '^^ ^^"^ ^^ "Property and <]uJus of sTskl'^^rK^T^ 2 Merchandise (folio 18) shows a balance Zl IJ *3.333.33 ; which is the cost of our two thirds of the merchan- dise belonging jointly to Mr. Austin and ourselves. We therefore enter our part on the debit under the head of " Property and DebtT" The account of Shipment to New Orleans (folio 16) does not now tZ.T/ T t P^^Pr^'.i^ having been sold, and the account-sab^ ZV^A .?^*v "^'^^^ ?'l^ ^^ '^^ ^hat the shipment has produced./' us and on the debit, what it has cost. The balance, in this case, is gaiirf which we enter under the head of " Profits and Losses." ^ the recedb""^ ""^ Shipment to Port au Prince is in the same state as Haying now been through the Leger, and taken from every account * ^^Lp/n? T'^ ^^ property and debts, and of profits and bases, and disposed of the sums under their appropriate heads on the Balance feheet, we add, with pencil, its columns, and ascertain the balances. Ihe Balance Sheet exhibits two important results : Under the head SL^iS-r^ ?t''' ^^ '^^? ^" ^^ P^^^ess, and all that we owe; the difterence, or balance, must be our present net capital— $52,120 13 All the sums of gam and those of loss, throughout the Leirer, have been brought on to the Balance Sheet, under the Lad of " PrffiS and Los" r«\}.rr.i f' ^ ""i '^^ ^^^^ r^^^^^^ °^ ^^is part of the sheet must be the net gam of our busines8-$8,546.48. Thifcan not be closed, or finished, until it has been proved. ^-'waea, or PROVING THE BALANCE SHEET. J^^^f^f^'^''' ^^^^' .^^1 ^^fT^^t, it may be proved by adding the net ^ t^the onginal. capital, which should make the net present capital ; J?n '5'^°^^^'/ old capital (balance of his account). . . .$26,870 96 C. C. Marsh's old capital (balance of his account) ...... .16,702 69 Net old capital in the business . 7?77q~F/; Net gain by the Balance Sheet .... .• ;.];;; g'^^g ^ Net present capital " 52420 13 Which, being the same amount produced by subtracting all we owe from all we have (property and debts), is proof that the Bailee Sheet is co^ r^t. The proof, then, consists in finding the present capital by two different methods: one, by subtracting our liabifities from^our aLiu the other, by adding our gain to our former capital. These operations should, of course, result in ihe same sum. operations > ^ CLOSING THE BOOKS. CLOSING THE BALANCE SHEET. 55 The net gain is divided equaljy between the partners, and the last two entries are made on the debtoi»|ide of that part of the sheet headed "Profits and Losses ;" which optation will close or balance that part of the sheet. \ ^ Each partner's share of the neticapital will be found by adding his half of the net gain to his olM capital^alance of his account). The last two entries on the credit d^diat part headed '* Property and Debts," show each partner's share mhe net capital, and close that part of the Iheet. tf.^ ^ Place the totals at the foot of the columns, affix the date, and the Balance Sheet is finished. If for any reason* it is not desired to close the books, all information relative to the state of our business may be derived from ihe Balance Sheet. CLOSING THE BOOKS. To close an account, means to make the debtor and creditor sides equal. Six entries in the Day-Book, composed from the contents of the Bal- ance Sheet, journalized and posted, will always close a set of books. There are two motives for making these closing entries : the first is, to carry the net gain of the business to the partners' accounts ; the other is, that each account in the Leger may begin anew, by its balance being separated from the other sums, and brought down below the totals, or lines. *• Day-Book, April 30 — Last six Entries. The last six entries in the Day-Book, under date of April 30, are composed from the Balance Sheet. The object of the Jlrst is, to transfer the losses from the several ac- counts where they now are, to one account, viz.. Profit and Loss ; there- fore we make this debtor in place of the others, and the others become creditors ; which entry, when posted, will close those several. The object of the second entry is to transfer the gains, in like manner, from the several accounts to one account — ^which is Profit and Loss ' therefore this becomes our creditor, and those our debtors. The object of the tJ^iri^ttry isVta transfer the net gain, which now stands at the Profit; ^ndJUjWaq^iift, to the accounts of the partners : these, therefore. Become tlfe credkore, and that the debtor ; .which entry! when posted, will .'dloBe the Profit and Loss account. . The ol^ct o£ the fourth entry is to transfer all the balances of Prop- erty and Debts, in our favor, 'tb "a new account opened in the Leger, entitled " Balances of April 30, 1850." Consequently, this new account becomes debtor for all the sums that the former owed us, and they be- come creditors ; which entry, when posted, will balance or close those accounts. Post the creditors in red ink. The object of the ffth entry is to transfer the balances of all those that we owe, to the account of " Balances of April 30, 1850 :" this. 56 OPENING NEW BOOKS. then, becomes the creditor, and those the debtors ; which will, when posted, close the accounts of Bills Payable and P. Harris. Post these two in red ink. The sixth entry closes or balances the three only remaining unclosed accounts. The balance of the account entitled " Balances of April 30, 1850," is now the net present capital— $52,120.13 ; and the balances of the accounts of the partners are their respective shares of said capital. To close these three accounts, the partners become debtors, and the " Balances" creditor. Post all these m red ink. The reason of posting the balances in red is, that such sums are hereafter to be brought down m new accounts, ^ All the accounts in the Leger ought now to balance ; therefore rule and foot them, and the books are closed. OPENING NEW BOOKS. If, when the books have been closed according to the directions given, there should be no necessity for opening new books, and the business is to be continued in the old ones, we open the accounts by merely bring- ing down (under the old heading, and below the lines) the balances al- ready vn-itten in the accounts in red ink, by writing " To Balance,'* or " By Balance,'* as the case may be. But if the books are full, and it should be necessary to open new ones, the best method is to make an entry in the new Day-Book, com- posed from the Balance Sheet, showing the state of the affairs at the closing of the old books, in the following manner : — f New York, April 30, 1850. 'Inventory of the Property and Debts of the firm of Blanchard & Marsh, as per Balance Sheet of this date, as follows : — Cash, balance on hand $26,274 Merchandise, per Inventory 15,000 Notes in our favor, as per Bill-Book 6,998 Store-Fixtures, valuation 270 Schooner Josephine, first cost 5,000 I Charles Lawrence, balance in our favor. . . 167 S. H. Lovell, balance in our favor 395 Walter Howard, balance in our favor 307 Shipment to Boston, of April 30, 1850 3,500 Company 2 Merchandise, our f on hand . . . 3,333 Our notes outstanding, aa per Bill-Book . . . 4,137 Paul Harris, balance in his favor 4,988 Net capital Of which Thomas Blanchard's share is $31,144 Of which C. C. Marsh's share is 20,975 JOURNALIZING. 57 The Journal entry of the preceding Day-Book entry would be such as to show several debtors and several creditors. The debtors are all those properties and persons which owe us, and the creditors those that we owe. For the balance between these, which is the net capital, the tirm owes the mdividual partners, and they should bo credited, thus :— ^""^"^« 1>T, To Sundries. ?/^^V" * V. $26,274 07 Merchandise i^^qOO 00 Bills Receivable 6,993 35 Dtore-l< ixtures 270 00 Schooner Josephine *.'.;."/. 5,000 00 Charles Lawrence jgy 07 S. H. Lovell 295 ^^ Walter Howard !!!!!!.".'!!!.'.'.*! 307 62 shipment to Boston 3 500 OO Company 2 Merchandise '.'.'.!'.'/.'.'. 3',333 33 $61,245 44 To Bills Payable 4,137 11 " Paul Harris 4,988 20 " Thomas Blanchard 31,141 20 " C. C. Marsh 20,975 93 61,245 44 When the above entry is posted, the new books will be opened. BUSINESS OF MAY: Transaction of May 16. onlv «4^no 7^°/-'' ""'''' ^''^^^« buy in this transaction, has cost us TT,„ ftl 1? .1 "'^.''''<=°""' °n 'h,e draft is no part of the cost of the stock. The^tock, therefore, owes us «4.000. When we receive any dividends on this stock, we shall credit it for the interest it produces us "'^'"^'"^^ ^change costs us. in this transaction, $20.10, for which it is debtor orZ-Vr,**"''"^ ^'*"'' ^ ^"- ^"^ '•>« ^'"O""' ^« draw on them or order them to pay for us ; they are therefore creditors. Transaction op May 23. In the traiisactiou of this date, we ship an invoice of goods in joint- account with Mr. Austin , we then ship half of the invoice for him''.Zd half for ourselves: therefore, he must owe us for his half of the Lhip ment, and the shipment owes us for what it has cost us for our half We owe whatever contributes to make up the amount of the shipment' MONTHLY ENTRIES. D ay-Book — The four Entries op Mat 31. The entries in the Day-Book of this month are introduced for the purpose of showing a plan of making monthly or weekly entries, which shall include all the simple transactions of the house — that is, the sim- ple purchases and sales of merchandise, simple cash receipts, and simple cash payments : such entries to be made up, at the end of each month or week, from the following books, viz. : Invoice-Book, Sales-Book, and Cash- Book. The first of the four entries in the Day-Book under this date, is sup- posed to have been taken or composed from the Invoice-Book. It in- cludes all the purchases of merchandise, during the month, for notes or on account. The purchases for cash do not come into this entry ^ but are included in the entry taken from the Cash-Book. The second of the four entries in the Day-Book of this month, is sup- posed to be composed from the Sales-Book. It embraces all the sales of merchandise, except the cash sales : these come into the Day-Book from the C ash-Book, with all other cash receipts. The third of the four Day-Book entries of this date, is drawn from the debtor side of the Cash-Book. It includes, in a condensed form, all the sums of money received during the month. The sums received of persons, and for which they should be credited, are shown separately with the dates ; but the other sums are brought in aggregate amounts. The last of the four Day-Book entries of this date we will suppose is composed from the creditor side of the Cash-Book. It comprises all the sums of cash paid out during the month ; those paid for merchandise, expenses, interest, and all other objects (except persons who owe us), in aggregate amounts. This monthly entry plan of writing up the business of a house, is much admired, and possesses many advantages over the method of making separate Day-Book and Journal entries of all transactions. Among its advantages may be enumerated the following : — 1st. It exhibits nearly the whole of the business of the month in only four Day-Book entries ; thereby affording, monthly, a very clear and satisfactory view of the business. 2d. The posting is reduced, not a hundred per cent., but to a hun- dredth part of what it would be on the daily or separate entry plan. 3d. Omissions or errors, in transferring sums to the Day-Book from the Cash-Book, Invoice-Book, and Sales-Book, can not occur^ because the addition of each Day-Book entry must agree with the addition of the book from which it is brought. 4th. The accounts of Merchandise, Cash, Bills Receivable, Bills Pay- able, Expenses and Interest, which generally cover many folios in the Leger, to no purpose, become, as they should, the shortest — not having on them more than twelve or twenty-four sums in a year. It must be understood and remembered, that the monthly entries can embrace no transaction which does not appear in full and complete in either the Cash-Book, Invoice-Book, or Sales-Book ; and that any trans- MONTHLY ENTRIES. 6Ji action that can not be made a purchase or sale of merchandise, or a cash receipt or payment, must have a separate Day-Book entry at the time it occurs, and may be journalized and posted separately. The monthly entry plan is not as simple as the other. To adapt it successfully, one must be well acquainted with the subject, and tnor- oughly understand how to conduct a set of books on the daily or sepa- rate entry method. Day-Book — May 30 (La«t Entry). This entry is made to give a sample of a day-book entry to correct er- rors which may sometimes be discovered after an account has been closed. As Mr. Harris was charged for an amount for which he should have been credited, it is now necessary to credit him for double that sunu tl») QUESTIONS AND ANSWERS. ««»' QUESTIONS AND ANSWERS, RELATING TO OPENING, CONDUCTING, AND CLOSING BOOKS. J OPENING BOO . Quest. What is meant by opening book s'w accounts ? Ans. Commencing the records of a business in a systematic manner, t. Q. With what records or entries does a business generally com- mence 1 . * . . A. With the circumstances of the person commencing business : with a statement of his capital. 3. Q. When a person begins business without capital, what will be the first entry in his books 1 A. The first transaction that occurs — a purchase or aught else. 4. Q. If a person begins business without capital, and owes to John Sims $1,000, what will be his Journal entry ] A. Supposing his name to be Thomas Blanchard, his Journal entry will be — Thomas Blanchard Dr. To John Sims «1,000 00 5. Q. If the first transaction in your books should be the purchase of 50 bales of cotton, of John Sims, on credit, amounting to $2,000, what would be your Journal entry 1 A. Merchandise Dr. To John Sims $2,000 00 6. Q. Why is that your Journal entry 1 A. Because it shows all the debtors and creditors of the transaction. 7. Q Why do you make Merchandise debtor, and John Sims creditor, in that transaction ? A, The Merchandise is debtor, because it owes me for what it has cost me ; and Sims is creditor, because I owe him — ^not having paid him for the cotton. It 8. Q. A. 9. Q. A. 10. Q. A. 11. Q. A. 12. Q. A. 13. Q. A. 14. Q. QUESTIONS AND ANSWERS. 61 What would be your Journal entry, if, at the commencement of your business, you borrow of J. Sims, cash — $3,000 ? Cash Dr. To John Sims $3,000 00 What would be your Journal entry, if you begin business with a capital, in cash, of $10,000 ? Supposing my name to be Thos. Blanchard, my entry would be — Cash Dr. To Thomas Blanchard $10 000 00 How do you explain this entry ? Cash is the species of property which owes me for my capital ; therefore it is debtor. Nothing can be debtor in my books, unless it owes me. I am creditor, because I am possessed of $10,000 capital, for which I owe no one. Why do you not, in opening your books, credit an account called " Stock," for your net capital ? By so doing, I should be calling myself « Stock" (that being the name given to the proprietor in some systems of book-keep- ing), and I do not perceive any good reason for substituting that name for my own. Note.— Where there are many partners in a business, as in a bank- ing or railroad company, there is kept an extra Leger, containing only the accounts of the partners. In such cases, there must be an account in the principal Leger to represent all those in the extra Leger: that account may be called "Stock," "Stockholders," or " Shareholders." When several persons commence a partnership in company, and all do not advance their portions of the capital, how would be your Journal entry ? I should credit such only as advanced capital, and neither debit nor credit the others. Will you imagine for me a Day-Book of the commencement of a single business, supposing the party to owe and be owed, and that your name is Thomas Blanchard ? I, Thomas Blanchard, commence business under the following circumstances : — I have in cash, deposited $1,000 00 I owe to John Sims, on account 100 00 My net capital $900 00 Or thus : — Property and Debts of Thomas Blanchard, per Inventory taken this day : — Cash, balance in bank $1,000 00 Balance due John Sims, on account 100 00 Net capital TTTTrrTT $900 00 In what manner will you Journalize these entries ? 62 QUESTIONS AND ANSWERS. A, I should Journalize them both thus : — Cash Dr. To Sundries. To John Sims $100 00 Thomas Blanchard 900 00 $1,000 00 <( 16. Q. A. 17. Q. A. CONDUCTING OR KEEPING ACCOUNTS. 15. Q. Which is the most important book of a set of account books t A. The Day-Book ; because it gives a complete history of our busi- ness, which we do not expect to find in the others. In some systems, the Day-Book is a mere blotter, and the transactions entered therein are repeated, with explanations, in the Jour- nal ; in that case, the Journal is the most important. How, or in what manner, should Day-Book entries be written t Day-Book entries should be written in clear and simple sen- tences : the different parts of a transaction should be stated in the order in which they occur. I do not think the words debtor and creditor should be used in Day-Book entries, but merely a simple record of the transaction. From what sources do you get the Day-Book entries ? Few transactions appear first in the Day-Book, although it is often called the book of original entry. Entries in the Day- Book are drawn from various sources — generally from the In- voice-Book, Sales-Book, C ash-Book, and Bill-Book. 18. Q. What do you consider to be the ot^ect of the Journal ? A. To exhibit the debtors and creditors^ which arise from mercantile transactions, separated from the sentences of explanation con- tained in the Day-Book, that they may be more easily and correctly transferred to the Leger. 19. Q. By what principle or rule do you distinguish debtors and cred- itors, or make Journal entries 1 A. The rule I use is this : All those persons and things which I think owe me, X call Debtors ; and all those which I owe, I call Creditors. 20. Q. In a transaction where there are many sums, how do you know which sum to affix to the name of a debtor ? A, After reflecting well on the transaction, I affix the sum which I can demand of him or it. 21. Q. Will you explain to me how things or objects can owe us when we have them ? A, Perhaps we had better begin with the definition of the word dollar. 22. Q. Very well ; how do you define the word dollar t A, Dollar is both the name of a coin, and the name of a measure of a quantity of value. As a measure, it conveys the same idea of value as yard does of space, pound of weight. A pound is a measure of weight, and a dollar is a measure of value. We may have ten yards of cloth, ten feet of land, ten pounds of QUESTIONS AND ANSWERS. 63 iron or gold : we may have ten dollars in either of these arti- cles, as well as in cash or money. 23. Q. Well, if I have $1,000, how can there be any debt, when I have the sum ] A. If you have $1,000, you must have that amount of value in some kind of property J because that sum is only a quantity of value (unless you speak of a thousand pieces of coin) ; therefore, finish your question, and tell me what you have the $1,000 in. 24. Q. If I have $1,000 in money, how does anything owe me ? A, Money and cash are only names of property : if you had $1,000 in land or merchandise, could not these owe you for the value invested in them 1 Why, then, does not the money owe you for that sum 1 25. Q. But, is not that imagination ] A. No, sir ; not unless the law is so. The law makes property and things liable for debts. The law that supports your claim on a person for $1,000, supports it belter on a property, because It maintains you in your authority over and possession of the property, until your claim is satisfied. 26. Q. You understand, then, that a thousand dollars means a quantity of value ; and if that value be in merchandise, the merchan- dise must owe for that value ; if it be invested in houses and lands, those, or real estate, must owe f)r that value; and if it be in cash or money, it must owe 1 A. Yes, sir ; if it is not so, the science of book-keeping is vnrong, and we can never fnore use the word debtor as applied to things. 27. Q. The science is right ; and you will do well, whenever you pay out any sum, to ascertain, with care, whaty as well as wTiOf you can charge for it. Why do you, in the first entry of the Journal of this book, carry out into the last column the two amounts % A, Merely to show that the sums of the debtors, and the sums of the creditors, form two equal amounts. 28. Q. Why ought the debtor and creditor sums equal each other ? A. When a person owes us, we must of necessity owe some thing for the sum that he owes us. This is the case in every trans- action ; therefore the debtor and creditor sum or sums are always equal in a correct Journal entry. 29. Q. How do you Journalize this — ^A friend makes you a present of $1,000 in cash ? And how explain it ? A, Supposing my name to be Thos. Blanchard, my entry would be — Cash Dr. To Thomas Blanchard $1,000 00 Cash is debtor, because it owes me the value it contains, or that I have in it ; and I, myself, become creditor, because I owe nobody for this value : it augments my capital. 30. Q. I have seen systems of book-keeping in which " Profit and Loss" is credited, in such a transaction. Is it wrong, and why ? I! 64 A, 31. Q. A, 32. Q. A. 33. Q. A, 34. Q. 1 ^ A. 1 A. 1 A. 1 Q- 1 A. 1 Q- L A. 1 Q. A. QUESTIONS AND ANSWERS. It is wrong, because " Profit and Loss" is the account which represents our business : it should show only the gains and losses that result from the business. In this transaction, we do not owe our business for the $1,000, because our business did not produce the sum. If, therefore, we carry such sums to the Profit and Loss account, the purpose for which it is opened will be completely frustrated. Which do you place first in a Journal entry, the debtors or the creditors ? The names of the debtors. I do not know why they are always placed before the creditors, unless it be that people generally think more of their debtors than they do of their creditors. Very well thought of ! Can you inform me why we never ^ee the word creditor (Cr.) in the Journal ? Because the word debtor (Dr.) distinguishes the debtors ; and there being only two kinds, one being shown, the others must of course be the creditors. To whom do the " Sundries" owe, in the Journal entry of Janu- ary 19 ? ^ They owe the owners of the books — Blanchard & Marsh. That entry reads—*' Sundries Dr. to Oliver Otis & Co." Why do you say, " to Blanchard & Marsh ?" Because there are certain words always understood to follow the word "Dr.," and certain others understood to precede the names of the creditors, in every entry in the Journal. What are those words ? Those which follow the term " Dr." are, ''to us;'* and those that precede the creditors are, " We are debtor'' Why are not those words used in Journal entries ? Those words are superfluous ; because the mere act of writine in our books any person or thing Dr., indicates that that person or thing is debtor to us, or is our debtor. What relation does the Journal bear to the Day-Book and Leger » An intermediate relation— serving to convey the debtors and creditors from the former to the latter. In Journalizing, do you make it a rule to extend the same sum in the Journal that you extend into the outer column in the Day-Book ? By no means : the position that sums occupy in the Day-Book should be no guide for their position in the Journal. Have you heard of a rule for Journalizing, founded on the words ''receive'' and "deliver?" Yes, sir — in these words : — " By Journal laws, what I receive. Is debtor made to what I give." How does this rule apply, and how not ? This rule originates in the coincidence that things are often QUESTIONS AND ANSWERS. 06 debtor and received at the same time. But this is far from being always the case : a striking instance may be found in the transaction of 3d of April in this volume. But if the things received were always debtors, and those delivered, creditors, such a rule would be unworthy of science, because, to admit this rule, one must admit that the word receive means debtor y and that deliver signifies creditor. 41. Q. For what purpose is the Leger ? A. To show the accounts of all those that owe us, and of all those that we owe. 42. Q. What do you understand by posting or legerizing 1 A. Transferring the sums from the Journal to the I eger. Posting , sometimes includes Journalizing. 43. Q. How often should books be posted ? A. t)aily, weekly, or monthly, according to the natui« of the busi- ness. 44. Q. A, 45. Q. A. 46. Q. A. What are the names of th© auxiliary books ? Cash- Book, Invoice-Book, Sales-Book, and Bill-Book. These are the principal, and appear indispensable in every business. What is the use of the Cash-Book ? It shows every sum of cash or money which we receive or pay. It serves as a check on that kind of property ; for the balance between its debtor and creditor sides, should agree with the money on hand. When do you balance the Cash-Book, and how ? Daily — when the business of the day is over. The book is bal- anced thus: Obtain the difference between the debtor and creditor pages, see that the difference agrees with the money we have on hand, and make an entry on the credit side by writing " Balance on hand" vnth the difference ; and when the account is ruled and footed, it will be balanced. When should entries be made in the Invoice-Book ? At the time the goods are received, the invoice, or bill of them, should be copied in the book. When are entries to be made in the Sales-Book ? At the time the goods are selected, or ordered by the purchaser, they should be described— quantity, quality, and price— in the Sales-Book. 49. Q. When, and how, do you take entries from the Invoice and Sales Books to the Day-Book ? A, Single purchases and sales may be carried from the Invoice and Sales-Books to the Day-Book separately, if they are of large amounts ; or, we may with propriety convey the purchases of a month or week, from the Invoice-Book to the Day-Book, in onXyone entry ; and the sales may be taken into the Day-Book in the same manner. 50. Q. What advantage is there in making monthly entries from the Invoice and Sales-Books into the Day-Book, over that of car- SI 47. Q. A. 48. Q. A, 6t QUESTIONS AND ANSWERS. rying the purchases and sales into the Day-Book in separate entries ] A. Considerable time and space are saved ; for, by the monthly method, the sales and purchases go to the merchandise account in totnls. 51. Q. When should entries be made in the Bill-Book ? A. When notes are issued or received, and when they are paid or negotiated. 52. Q. We know many book-keepers who post directly from the Invoice, Sales, and Cash Books, to the Leger. What is there objection- able in that method ? A. When that method is pursued, there will be no book of the set that will show a complete history of the business, or a record of the transactions as they occun*ed ; and if at any period the books should not balance, the trouble of finding the errors would be greatly augmented. Note. — There are some houses in which the transactions, particularly the sales, are so numerous that it is necessary to adopt the most abbreviated system, or the book-keeper would soon be far in the rear of the business. By the method referred to, no book called Journal is used ; but, nevertheless, all the knowledge which that book em- braces, is required, even in a greater ratio, because that system makes the Cash, Invoice, and Sales-Books, serve the double purpose of Journals. 53. Q. A. 54. Q. A. 55. Q. A. 56. Q. A. 57. Q. A. 58. Q. A, 59. Q. A. What is a Trial Balance ? It is a sheet which shows the balances of all the accounts in the Leger, arranged in two columns — one of debtors, and one of creditors. What is the object of the Trial Balance ? To prove the books, and to exhibit the balances. If the posting, additions, and subtractions, are correct, the two columns will add up alike. Should they not equal, how would you proceed to find the errors 1 1st. By examining the Journal entries, to see if the debtors and creditors in each entry equal each other. 2d. By examining the posting from the Journal to the Leger, and by re-adding and re-subtracting the accounts in the Leger. I would repeat these, until I had found the error or errors. How often is it necessary to make a Trial Balance t Monthly, or quarterly. Sometimes it is left until the end of a year, when it rarely balances. If you buy merchandise for cash, in what books do you make entries ? In the Cash, Invoice, and Day Books. If you buy merchandise on credit 1 In the Invoice and Day Books. If you buy merchandise on your note t In the Invoice, Bill, and Day Books. 60. Q, A, 61. Q. A, 62. Q. A. 63. Q. A. 64. Q. A, 65. Q. A. 66. Q. A, 67. Q. A. 68. Q. A. 69. Q. A. 70. Q. A. 71. Q. A, 72. Q. A. 73. Q A, 74. Q. A. 75. A. 76. A. 77. A. QUESTIONS AND ANSWERS. 67 If you merely exchange merchandise 1 In the Invoice and Sales Books. If you sell merchandise on credit 1 In the Sales and Day Books. If you sell merchandise for cash ? In the Sales, Cash, and Day Books. If you sell merchandise to John Sims on his note 1 In the Sales, Bill, and Day Books. If you receive money of John Sims 1 In the Cash and Day Books. If John Sims pays a note you hold against him t In the Cash, Bill, and Day Books. If you pay for postages ? In a petty Cash-Book. If you pay rent of your store ? In the C ash-Book and Day-Book. If there is to-day due J. Sims, for services as clerk in your em- ployment, $500 ? In the Day-Book. Will you make the Day-Book entry ? Amount of salary due John Sims for services as clerk, up to this date $500 00 What is your Journal entry ? Store-Expenses Dr. To JTohn Sims $500 00 Suppose, after posting the above, the balance of J. Sims* account is $200, and that you pay it : what will be your Journal entry ? John Sims Dr. To Cash $200 00 If you pay the rent of your dwelling-house, in what books do you enter ? In the Cash-B6ok and Day-Book. What would be your Journal entry 1 Thos. Blanchard (my name) Dr. ToCash $250 00 If you pay your note, now due, in what books do you make entries 1 In the Cash, Bill, and Day Books. If you deliver your note to P. Harris for balance of account ? In the Bill and Day Books. If P. Harris gives you his note for balance of account t In the Bill and Day Books. What difference is there between those notes ? One is in my favor ; the other against me. I call one " Bills Re- ceivable ;" the other, " Bills Payable." 68 QUESTIONS AND ANSWERS. QUESTIONS AND ANSWERS. 60 78. Q. If P. Harris's note in your favor is due, and remains unpaid, in what books do you make entries 1 In the Bill-Book and Day-Book. What will be your Journal entry f P. Harris Dr. To Bills Receivable $1,000 00 How can you call Mr. Harris a debtor, when you still hold the note ? Does not the note owe you now, as well as it did before ? I think not, sir. The time of the note has expired — it is now dead. Before the note was due, we could demand nothing of Mr. Harris ; when it is due, our claim begins on its author : " the law allows it, and the court awards it." Note. — We are aware that many book-keepers do not charge the par- ties to notes for their amounts when due ; but it is the more regular way to do so. The party to a note over due, undoubtedly owes the amount, and interest from the date it became due ; therefore his ac- count should show it. A. 79. Q. A. 80. Q. A, 81. Q. A, 82. Q. A, 83. Q. A. 84. Q. A. 85. Q. A. 86. Q. A. When we say, " Mr. Harrises note (or acceptance) t* due and paid,** what kind of a note is spoken of] " Harris's note" means a note that Harris wrote or signed — a note against him, and not a note belonging to him. If Mr. James owes you $100, and you accept $98 for it, what will be your Journal entry ? Sundries Dr. To J. James. Cash $98 00 Profit and Loss 2 00 $100 00 If you draw on a person, does he become your debtor or cred- itor, and in what books do you make entries 1 My creditor. I make entries in the Day-Book ; and in the Bill- Book if the draft is in my favor. Why your creditor ? Because I owe him the sum for which I have drawn : drawing on him is drawing from him. Should the draft be returned, in what books will you make entries ? In the Day-Book and Bill-Book. What is accepting a draft ? Writing one's name across the face of it, by which one agrees to pay it when due. CLOSING ACCOUNTa 87. Q. What do you understand by closing accounts, or balancing books ? A, By closing accounts, we mean the act of rendering the debtor and creditor sides of every account equal. This is done by trans- ferring the balances from the many accounts to only two ac- counts, and there showing the result of the business in a form 80 condensed as to be seen at one view. 91. Q. A. 92. Q. A. 93. Q. A. 88. Q. To what do we first direct our attention, in balancing or closing books ? A. To the Trial Balance. 89. Q. After that, what next claims our attention.? A. The Balance Sheet ; by which we show the result of our busi- ness—our assets and liabilities, our gains and losses. 90. Q. Why is it necessary to close the books, when the Balance Sheet exhibits the situation of the affairs % A. The Balance Sheet may suffice for the closing, when the books are not to be changed ; but when the gain or loss is to be divi- ded and carried to the partners* accounts, or when new books are to be brought into use, the closing entries in the Day-Book, Journal, and Leger, become necessary. What follows the Balance Sheet, in closing the books ? We proceed then to make entries in the Day-Book, composed from the contents of the Balance Sheet, which we Journalize and post. Which side of the Cash account can exceed the other ? The debtor side. The creditor side can never exceed the debtor, and be correct. Why is the debtor side of the Cash account generally more in amount than the creditor ? Because that kind of property called cash is of an unvarying value : it comes in and goes out of our possession, or is bought and sold, at the same price ; because we can not pay out more money than we have received. 94. Q. To what account do you transfer the balances of property and debts, at the closing of the books 1 A. To an account called " Balances," opened for that purpose. 95. Q. To what account do you transfer the balances of gains and losses, at the closing ? A, To the " Profit and Loss" account. 96. Q. To where do you transfer the balance of the " Profit and Loss" account ? A. To the accounts of the partners, or to that of the owner of the books. 97. Q. Which side of the account of Bills Receivable can exceed ? A. The debtor. The excess ought to agree with the notes on hand, as appears by the Bill-Book. 98. Q. Which side of the account of Bills Payable can exceed % A. The creditor. The excess should agree with the amount of notes out against us, as appears by the Bill-Book. 99. Q. Is there more than one method of making an Account-Cur- rent 1 A, There are three methods : 1st, without interest ; 2d, with in- terest ; and 3d, by averaging, to find when the balance is due. 70 QUESTIONS AND ANSWERS. 100. Q. Which part of book-keeping embraces most of the science ? A. That part called Journalizing. 101. Q. When a set of books is kept by double-entry, and the book- keeper dispenses with the Journal, does he dispense with Journalizing ] A. No, sir. The Journalizing must be done somewhere : the principle of the Journal must regulate or govern all his entries. J NOTE. This book is designed to contain a complete history of the business. Entries in this book are made up from various sources ; those embracing sales are taken from the sales-book ; those embracing purchases of goods are taken from the invoice-book ; cash sums come from the cash-book ; notes given or received come from the bill-book ; while others, of a different or various nature, appear first in the day-book. The only rule I can give for making or composing entries in the day-book is this ; adhere to the truth, state the transaction with its parts in the order that they occur, use as few words as possible, and let them be to the point or pur- pose. From this book the transactions pass in a journalized form, into the journal. New York, January 5, 1850. 1 T Thomas Blanchard and Christopher C. Marsh having, as per articles of agreement dated Ist instant, entered into partnership, advance the following capital : — Thomas Blanchard advances- Cash, deposited $26,000 00 Note No. 1, as per Bill-Book 2,000 00 C. C. Marsh advances — Cash, deposited $12,000 00 Note No. 2, as per Bill-Book 2,670 00 Merchandise, as per Invoice-Book, fol. 1 3,125 00 Charles Lawrence, balance of account 140 00 ' (( 00 Thomas Blanchard and Christr. C. Marsh are indebted to Notes in favor of sundry persons, as per Bill-Book, which are assumed, viz. : — No. 1, on Thos. Blanchard, for $1,080 00 No. 2, on C. C. Marsh, for 1,230 00 Paid Cash for sundry Store-Fixtures bought of W. Wharton, amounting to 8 Sold Merchandise to Paul Harris, at sixty days, as per Sales-Book, folio 1 10 Sold Merchandise to William Blakeley, on his Note, No. 3, at thirty days, as per Sales-Book, folio 1 , 12 i Sold Merchandise to S. H. Lovell, for Cash, as per Sales*Book, fol. 1, amouniuig to 13 Sold Merchandise to Oliver Otis & Co., to be paid for on 19th inht., as follows ; — Half in Cash, and half in Note at thirty days, as per Sales-Book 14 Bought Merchandise of Henry Austin, at thirty days, as per Invoice-Book, fol. 1 10 73 2,310 300 325 500 125 2,000 1,500 00 00 00 00 oe 00 00 00 00 New York, January 14, 1850. Bought Merchandise of Rogers & Brothers for Cash, as per Invoice-Book, fol. 2 16 . Bought Merchandise of Rogers & Brothers, on our Note, No. 3, at ninety days, as per Invoice-Book , « . . Bought of Christopher Bernard an invoice of Rice, amounting to, per Invoice-Book, $3,200 ; and paid him as follows : — In Cash, amounting to $2,000 00 In Merchandise, as per Sales-Book 1,200 00 . 17 Lent Cash to James Truman, until 22d inst 19 Received of Oliver Otis & Co., for balance of account, as follows : — Their Note, No. 4, at thirty days, for $1,000 00 In Cash, amounting to 1,000 00 » 20 Sold Merchandise for Cash, to sundry persons, as per Sales-Book 21 Received of Paul Harris his Note, No. 5, at sixty days, dated 8th inst., for bill of that date 82 Received Cash of James Truman in full for loan of 17th inst II .- Delivered to Henry Austin our Note, Ntf. 4, at thirty days, for bill of 14th inst 24 Sold Merchandise this day, as follows : — To S. H. Lovell, on account, as per Sales- Book $250 00 For Cash to sundry persons 160 00 74 800 2,100 3,200 1,000 2,000 250 325 1,000 00 1,500 410 00 00 00 00 00 00 00 00 00 m 2 vl* New York, January 26, 1850. Sold Merchandise as follows, as per Sales-Book : — To Oliver Otis & Co., on account $200 00 To William Blakeley, on account 200 00 28 Lent Cash to James Truman, on his Note, No. 6, at twelve months, endorsed by Paul Harris $2,000 00 Interest for one year, at 6 ®|of added 121 00 3Q Paid Cash for our Note, No. 2, in fiivor of T. P. Cope & Sons, now due February 2. Paid Henry Austin for our acceptance. No. 1, for $1,080, as follows :— * In Merchandise, as per Sales-Book $550 00 " Cash, amounting to v • • • " ^^^ ^^ " Discount, 26 days allowed, at6^|o---«.--- 4 68 V ■ ■ — — ^iC " Paid Cash for sundry expenses of Store last month, as per petty Cash-Book 4 Shipped per Brig Franklin, Kay, and consigned to Lockhart & Arrott, New Orleans, to be sold for our account, an Invoice of Hardware $1,722 22 Paid Cash for Insurance and shipping ex- penses 100 00 6 -• Sold to Christopher Bernard, on his Note, No. 7, at six months, the remainder of Hardware, as per Sales-Book 9 William Blakeley has failed ; the balance of his account in our favor is $200, for which we have received, in Cash $100 00 The Balance is lost lOO 00 X 75 $ 400 2,121 1,230 1,080 65 1,822 00 00 00 320 QP 00 22 GO 200 00 % \ ■^\ \ > 4 New York, February 12, 1850. Bought Merchandise of Haven & Smith, as per Invoice- Book, $1,240; delivered to them in payment, as fol- lows : — Our order at sight on Charles Lawren-^e, for. $ 140 00 Oliver Otis & Co/s Note, No. 4, duo 21st inst., for : 1,000 00 And Cash for the balance 100 00 12 William Blakeley's Note, No. 3, is due and not paid 13 : Received per Steamer Washington, Floyd, consigned to us by Walter Howard, London, pursuant to our order and for our account, an Invoice of Dry Goods, amount- ing to oei,100 sterling $4,888 89 Signed Bonds, Nos. 5, 6, and 7, to the Cus- tomhouse for Duties ^'^^ 22 Paid Cash for Freight 4ai00 i< Received of Willian Blakeley, for balance of his ac- count of $500, as follows : His Draft on S. m. Lovell, accepted at thirty days, for $250 00 Interest added for 33 days 1 37 Face of the acceptance. No. 8 251 37 William Blakeley having failed, the balance is lost 250 00 - 16 Accepted Draft at twenty days' sight. No. 8, drawn by Walter Howard, London, in favor of Lewis Clapier, for 17 Delivered Merchandise to Henry Austin, in payment of our Note, No. 4, due 16th inst., as per Sales-Book . . 20 Shipped per Steamer Atlantic, West, consigned to Wal- ter Howard, London, pursuant to his order, dated Jan- uary 2, as follows : — » Forward. 76 $ 1,240 500 6,533 501 4,444 1500 00 00 11 37 44 00 New York, February 20, 1850. 5 Brought. 120 tierces Rice, 420 cwt., at $3.50 $1,470 00 280 barrels Flour, at 4.50 1,260 00 Paid Cash for shipping expenses 75 00 Paid Cash to Phoenix Insurance Co., for 3 °lo premium on $2,805, and for policy $1 85 15 Our Commission for shipping $70 12 Commission for Insuring, at J °|o 14 02 84 14 20 Bought of William Evans, on acccount, 280 barrels Flour, as per Invoice-Book 21 Bartered with Christopher Bernard an Invoice of Dry ^Groods for the same amount in Rice, as per Invoice- '•Book (( Exchanged our Note, No. 9, at sixty days, with Chris- topher Bernard, for his Note, No. 9, for same amount and time 23 Sold Merchandise to James Truman, as per Sales- Book ; received payment as follows : — His Note, No. 10, at sixty days, for $500 00 InCash 120 00 The balance he is to pay on the 26th inst., by an acceptance for 1,000 00 24 Sold Merchandise to Strang, Adriance, & Co., on their Note, No. 11, at ninety days, as per Sales-Book << Discounted, at the Commercial Bank, Strang, Adriance, & Co.'s Note, No. 11, for " $2,000 00 Discount for 93 days, at 6 o|o 31 00 Cash received — — 25 Bought the S-'hooner Josephine, of Captain C. Da- vis, at $5,000 ; delivered to him in payment as fol- lows : — Forward. 77 $2,974 29 1,260 00 r' 1,530 ^(f^ 800 00 1,620 00 2,000 00 1,969 00 6 New York, February 26, 1850. Brought. Our Bill of Exchange, at sixty days* sight, on Walter Howard, for £500 sterling $2,222 22 Exchange allowed us, at 8 ^l© premium .... 177 78 And Cash for the balance 2,600 00 26 Received of James Truman his Draft, at sight, on Wil- liam Evans, which is accepted and passed to account, for M Paid Cash for sundry Bills of Rigging and repairs for our Schooner Josephine 27 Shipped per Schooner Josephine, Whipple, consigned to H. B. Walker & Co., Port au Prince, to be sold for our account, as follows : — An Invoice of Domestic Goods, received of Irvine Fisher, in exchange for same amount in Imported Goods . . , $1,200 00 200 boxes Soap, 4,000 lbs $ 300 00 200 " Sperm Candles 1,890 00 2,190 00 Which we have bought of J. R. Dallett & Co., on our Note, No. 10, at sixty days. 144 boxes Cheese, bought of Charles Law- rence on account 288 00 Amount of Freight on the above, per our Schooner Josephine 230 00 28 Insured, at the Phoenix Insurance office, our Shipment to Port au Prince of 27th inst. ; passed our Note, No. 11, for 2 ®|o prem. on $4,028, and policy $ 81 56 Paid Cash for Shipping expenses 120 00 t* Effected Insurance with the Atlantic Insurance Co., on our Schooner Josephine, for $5,000, at ^ ®|o premium, which we^have paid in Cash (policy $1) 78 $5,000 ; 00 1,000 00 155 3,908 201 26 00 00 56 00 New York, March 2, 1850. Sold Merchandise as per Sales-Book, as follows :— To Oliver Otis & Co., on account $500 00 To William Blakeley, and received of him in payment, Charles Lawrence's order on us for the same amount 288 00 (I Paid Cash for sundry expenses of Store, as per petty Cash-Book Received per Brig Clio, Kirk, consigned to us by Jo- seph De Nones, Cadiz, to be sold for his account, an Invoice of Fruit, amounting to $2,700. Paid Cash for Freight and Duties tt Sold for Cash, as per Sales-Book, as follows : — 152 boxes of De Nones' Consignment Sold of De Nones* Consignment, as per Sales-Book, as follows : — To Charles Lawrence, on account — 25 boxes Oranges, at $3 $75 00 200 jars Olives, at .50 100 00 To Thomas Milton, for Cash- 100 boxes Oranges, at $3. . 175 00 300 00 Received Cash for Oliver Otis & Co.'s acceptance. No. 2, at sixty days, now due it Received of Oliver Otis & Co., their Note, No. 12, at sixty days, for balance of account $700 00 Interest for 63 days added, at 6 "|o 7 35 Paid Cash to sundry persons for damages found in Sales for account of J. De Nones, of 3d and 4th inst. $45 00 Made allowance to Charles Lawrence, on ac- count, on same Sales 10 00 79 $ 788 460 456 475 2,670 707 55 00 45 00 00 00 00 00 35 00 8 New York, March 9, 1850. Sold to S. H. Lovell on account, as per Sales-Bo k, as follows : — 20 tierces Rice, amounting to $245 GO /)0 boxes of De Nones' Fruit, at $3 150 00 9 Paid Cash for our acceptance. No. 8, in favor of Lewis Clapier, being Walter Howard's Draft, for Received Cash of S. H. Lovell, for balance of account of January 24th 10 f- Sold per L. M. Hoffman & Co., for Cash, De Nones* Consignment, as follows : — 150 boxes Lemons, at $5 $750 00 110 " Oranges, at 3.80 418 00 220 jars Olives, at .50 110 00 1,278 00 Auctioneers* Commission, at 3J ®|o 44 73 Net amount received • — — — — — — . II -———————______________ Received to our account the remainder of De Nones*' Invoice of Fruit, being 4,000 jars Olives, at market price — $ .50 12 Received Cash of Paul Harris, as follows : — For his Note, No. 5, now due $325 00 For 1,000 jars Olives, sold him at $ .52^ 525 00 14 ■ ■ . Rendered to Joseph De Nones, Cadiz, account-sales of Invoice of Fruit, received per Brig Clio, from which we obtain the following : — Our Commission on total Sales, $4,314.27, at 5 ®|o, is $215 71 Storage, Advertising, and Labor 52 24 Net proceeds, due May 25 | 50 3,531 32 * 16 Received from Lockhart & Arrott, N. Orleans, account- sales of our Shipment to them of Feb. 4 : Net proceeds 80 $ 395 4,444 250 00 44 00 1,233 2,000 850 27 00 3,799 00 27 2,020 00 ♦ • 8 Npw York, March 16, 1850. Received Cash for S. H. Lovell's acceptance. No. 8, being William Blakel^*s Draft 18 Received Cash of Paul Harris, to be applied for him in buying Merchandise on joint account with us, as per agreement 20 • Bought <# Bunker & Stan* for Cash, in joint account with Paul Harris, 800 barrels Flour, as per Invoice- Book, $4,000. Of which Paul Harris's half is $2,000 00 Our half is 2,000 00 • 21 ZZIZZ Received of Paul Harris, to be sold in joint account, 500 barrels Flour, at $4.75, amounting, per Invoice- Book, to $2,375 ; of which our half is 23 Sold to E. K. Collins 500 barrels Flour in joint account with P. Harris, at $6 Received payment as follows : — ' Our Note, No. 3, in favor of Rogers & Brothers, due April 19th, for $2,100 00 Interest allowed us for 26 days, at 6 °|q 9 10 2,090 90 Received the balance in Cash 909 10 25 ~~~ :- m — I' ■ ■ I II — 11.11. ..I — Mill ■ — ■I - M^— ^^■■^^M— I^M »iW— ■■ II— .^^M^illlliM— ^fc^^l^M^^i^^—— — ^— ^^IM. Paid Cash to C. C. Marsh, on account 26 Bought of Brown Brothers & Co. their Bill of Ex- change on Brown, Shipley, & Co., Liverpool, at twenty days* sight, for <£ 1,000 sterling $4,444 44 Exchange, at 8 °|o prem. on $4,444.44 355 56 Delivered to them in payment — 400 ban-els Flour in joint account with Paul Harris, at $6 $2,400 00 And Cash for the balance 2,400 00 11 81 $ 251 2,000 4,000 1,187 3,000 3,000 300 4,800 4,800 37 00 00 50 00 00 00 00 00 ^0 "S "^^ \ 10 8 8 8 8 New York, March 27, 1850. Sold to Oliver Otis & Co. 200 barrels Flour in j#nt ac- count with P. Harris, at $6, as per Sales-Book Received of them in payment — Their Draft at sight, on Wm. Evans, which is accepted in account, for $260 Their Note, No. 14, at sixty days, for 50 And Cash for the balance 440 — 28 ZI Bartered with Haven & Smith the balance of Flour joint account with Paul Harris — 200 barrels, at $6.25 Received of them in exchange — 227 barrels Mackerel, at $5.50 $1,248 50 And Cash 1 50 \ 30 Rendered to Paul Hanis account-sales of Flour in joint account, showing the following result : — Our Commission on total Sales, $7,850, at 2 J ° 1 $ 196 25 Storage on 1,300 barrels 1 mo., at 3 cts 39 00 Net proceeds, $7,614.75 — Of which P. Harris's half is due May 3 | 50 . . 3,807 37 Our half net proceeds is $3,807 38 * Our half cost is 3,187 50 Our net gain is * 619 88 Paid Cash as follows : — For sundry expenses of Store last month, as per petty Cash-Book $162 00 To George Loder, for three months' rent of "Warehouse 300 00 Received per Steamer Crescent City, from Lockhart & Arrott, New Orleans, pursuant to our order, in full for 8 proceeds of our Shipment to them of 4th Feb., Invoice of 230 bales Cotton, amounting to $2,020 00 Paid Cash for Freight and expenses 300 00 00 1,200 00 1,250 1,250 4,662 462 00 00 50 00 2,320 I 00 I 8 8 8 New York, April 3, 1850. Received of Irvine Fisher, to be sold for his account, Invoice of 300 bags of Laguayra Coffee, amounting to 6 Sold Fisher's Coffee as follows : — To S. H. Lovell, at 4 months, 75 bags^ as per Sales- Book $1,350 00 To Oliver Otis & Co., on account, 50 bags, as per Sales-fiook 810 00 : 7 ZZZZZ Renewed C. Bernard's Note, No. 1, for $2,000, now due. Received his Note, No. 15, for same amount, and Cash for 63 days' interest 8 Sold to H. Burrell & Co., for cash, 100 bags Fisher's Coffee, as per Sales-Book, $1,440 ; which amount we have paid over to Irvine Fisher on account 10 Paid Cash to sundry persons for damages found in Sales of Fruit on account of Joseph De Nones, amounting to $22 00 Allowed to ourselves for defects, &c., in 4,000 jars Olives, taken to our account March 10 . . 40 00 11 ZZZZI Received of S. H. Lovell, for bill of 6th inst., his Note, No. 16, at 4 months, for Discounted the above Note for Irvine Fisher, and paid him in Cash $1,322 33 In Discount, allowed us 27 67 13 ZUZZ Shipped per Brig Pilot, Milton, and consigned to Jo- seph Eaton, Boston, to be sold for our account, as fol- lows : — 115 bales Louisiana Cotton $2,160 00 1000 jars Olives, at .50 500 00 50 bags Coffee of Fisher's Consignment taken to our account ^ 720 00 Paid Cash for Insurance and Shipping ex- penses 120 00 $3,375 S,160 21 1,440 62 1,350 1,350 3,500 11 00 00 00 00 00 00 00 00 83 I 12 9 9 10 10 I New York, April 14, 1860. Received of Oliver Otis & Co., for sale of 6th inst, as follovvrs : — Their order at sight on Irvine Fisher, which is accepted in account, for $310 00 Cash, amounting to 500 00 . 15 IZZZZ Delivered to Thomas Blanchai'd, on account — Cash, amounting to $500 00 3 bags Fisher's Coffee, per Sales-Book 43 20 16 ^ Sold to Paul Harris, for Cash, the balance of Fisher's Coffee — 22 bags, as per Sales-Book _-__-________-^___________— . " - — — — — _ Rendered to Irvine Fisher account-sales of his consign- ment of Coffee, showing the following result : — Total Sales, $4,680 ; on which our Commission, at 2J o|^, is $117 00 Storage, Advertising, and Labor 18 00 Net proceeds 4,545 00 18 ZIZZZZ Sold to Thomas Owen & Son, 150 tierces Rice, as per Sales-Book Received of them in payment as follows : — Irvine Fisher's -Note to them, No 17, for $1,200 00 And Cash, amountinsr to •'. 637 50 ,,^_____ . t( , Delivered to Irvine Fisher, for balance of his account, as follows : — His Note, No. 17, due 20th inst $1,200 00 And Cash, amounting to 245 00 20 - ^- — Bought at auction of Wilmerdings & Mount, in joint account with Henry Austin, 500 doz. Madeira Wine, at $10 Delivered in payment, as follows : — Our Note, No. 12, at 4 months, for $2,033 33 C. Bernard's Note, No. 9, for $800 00 J. Truman's Note, No. 10, for 500 00 1,300 00 Ampunt of our f interest 3,333 33 Henry Austin paid W. & M. for his J, jflhount- ing to 1,666 67 84 $ 810 00 543 20 316 4,680 1,837 1,837 1,445 5,000 5,000 80 00 50 50 00 00 00 New York, April 21, 1850. 10 Paid Cash as follows :— For 12 lottery Tickets $120 00 For Discount on $475 uncurrent money, IJ ^'lo • ^ 31 24 10 10 Sold Brown Brothers & Co.'s Bill of Exchange (No. 13) on Brown, Shipley, & Co., Liverpool, drawn for c£l,000 sterling $4,444 44 Exchange, at 8J ojo premium ... 377 78 $4,822 22 Brokerage, | o|o 12 06 Received in payment as follows : — Our Note, No. 10, in favor of J. R. Dallett & Co., due May 1?% for $2,190 00 Interest for 7 days allowed us 2 55 Allowed for the Note 2,187 45 Cash for the balance 2,622 71 Premium on the Bill, as above 377 78 Paid Brokerage, " 12 06 <( 10 Renewed our Note, No. 9, in favor of C. Bernard, for $800, by our Note No. 13, for same amount and time, and paid Cash for 63 days' interest on new Note 27 Bought at auction of Gerard & Betts, 50 chests Tea, amounting to $4,725 ; and transferred the same to J. Percival for 3 °Jq advance, which is received in Cash. . « ^ Received Cash for proceeds of tickets in Lottery, ' bought on 21st inst 10 11 Received Cash enclosed in an anonymous letter ad- dressed to us 28 Received per Schooner Josephine, Whipple, from H. B. Walker & Co., Port au Prince, an invoice of 37 tons St. Domingo Hides, being net proceeds of our Consign- ment to them of Feb. 28, account-sales now received, amounting to $6,000 00 Value of the Freight per^ur Schooner 200 00 85 $ 128 4,810 4,810 365 8 141 1,700 13 530 6,200 31 16 16 72 40 75 00 00 00 f tjf^- ' 14 11 U 11 11 11 11 New York, April 28, 1850. Received per Schooner Josephine, Whipple, consigned to us by H. B. Walker & Co., Port au Prince, to be sold for their account, an invoice of 20,000 feet Mahogany, amounting to $2,400 ; which v^re have taken to our ac- count at the market price, 15 cts. per ft $3,000 00 Charges : — Freight per our Schooner .$125 00 Expenses paid in Cash 75 00 Our Commission on $3,000, at 5 ^L 150 00 350 00 Net proceeds due H. B. Walker & Co. 29 Received Cash of Capt. Whipple for freight per Schr. Josephine, on her voyage to Port au Prince 30 Paid Cash for sundry expenses of Store this month, as per petty Cash-Book ti Received Cash of Harmony's Nephews & Co., for amount of Draft on them at sight, remitted to us by Joseph Ruiz, P. Principe, for collection $5,000 00 Our Commission, at ^ °|q 12 50 it Bought for Cash of A. Belmont, his Bill of Exchange, No. 18, at sixty days' sight, on Rothschild & Co., Paris, per order of H. B. Walker & Co., Port au Prince, to whom we have remitted the same : Bill for 14,062.73 francs, exchange at fr. 5.32 per dollar, amounting to $2,643 37 Our Commission on $2,650, at J °|o 6 63 tt Bought for Cash of B. Blanco, his Draft, No. 19, at 15 days' sight, on Francia & Co., Cadiz, and remitted the same to Joseph De Nones, Cadiz, for balance of account due him in Cadiz — $3,469.32. Face of the Draft $3,454 80 Exchange, at 1^ °|q discount 51 82 Paid for the Draft Interest for 25 days in our favor on $3,469.32, due J. De Nones May 25 50 86 $ 2.650 500 200 4,987 00 00 00 50 2,650 00 3,402 14 98 52 11 11 12 12 12 12 12 New York, April 30, 1850. 15 Bought for Cash of Moses Taylor & Co., their Bill of Exchange, No. 20, at 30 days* sight, on Drake Brothers & Co., Havana, on account of Joseph Ruiz, Puerto Principe, to whom we have remitted the same : Face of the Bill $5,050 63 Exchange, at IJ °|o discount, favor J. Ruiz, 75 75 Paid for the Bill 4.974 88 Our Commission on $5,050.63, at i ^Iq 12 62 ij $ 4,987 « Bought for Cash of Jacob Little & Co. — 10,500 Spanish Dollars $10,500 00 At Premium of f ojo 78 75 It Balances of Interest in favor of the following, as per accounts-current rendered to this date : — Thomas Blanchard, partner $494 16 C. C. Marsh, " 297 69 II Balance of Interest in our favor, as per account-current rendered to C. Lawrence, to this date (( Balance of Interest in favor of Paul Harris, as per ac- count-current rendered him to this date « CLOSING ENTRIES. Profit and Loss account must be debited for the follow- ing balances, being losses, as per Balance-Sheet : — Store-Fixtures, loss $ 30 00 Store-Expenses, loss 662 70. Discount and Interest, loss 613 27 (i Profit and Loss account must be credited for the follow- ing balances, being gains as per Balance-Sheet : — Merchandise, gain $3,562 86 Schooner Josephine, gain 874 00 Commission, gain 794 85 Exchange, gain 152 70 Shipment to New Orleans, gain 197 78 Shipment to P. au Prince, gain 1,890 44 10,578 791 2' 1,306 7,472 50 75 85 07 67 03 63 \ I A '^* 16 New YpRK, April 30, 1850. 12 The net gain accruing from the business the last four months, as appearT.by the Profit and Loss account. IS $8,546.48— Of which Thomas Blanchard's half is $4,273 24 Of which C. C. Marsh's -half is 4,273 24 II 12 13 13 Balances of Property and Debts in our favor, as per Balance-Sheet, as follows : — ^*sh, balance on hand $26,274 balance on hand 15,000 balance on hand 6,998 valued at 270 ^, , _. first cost 5,000 Charles Lawrence, balance in our favor ... 167 S. H. Lovell, balance in our favor . . . 395 Walter Howard, balance in our favor . . . 307 Shipment to Boston, no account-sales 3,500 Comp. 2 Merchandise, our | on hand 3,333 Merchandise, Bills Receivable, Store-Fixtures, Schr. Josephine, 07 00 35 00 00 07 00 62 00 33 (i Balances in favor of Sundries, as per Balance-Sheet :— Bills Payable, Notes outstanding $4,137 11 Paul Harris, balance in his favor 4,988 20 « The Balance account of April 30, 1850, shows the amount of our net capital--$52,120.13; of which— Thomas Blanchard's share, as appears by his account, n' n 'tI^ " i; • • I $31,144 20 <^. C. Marsh s share, as appears by his ac- ^o^^^'^s 2Q975 9^ $ 8,546 48 61,245 9,125 44 52,120 31 13 14 14 14 14 14 14 New York, May 10, 1850. 17 Amount of Salaries due the following Clerks in our employment : — C. J. Martin, from January 5 to 5th inst $300 00 John Sims, from February 1 to 1st inst 200 00 15 Delivered to Paul Harris our Note, No. 16, at. three months, dated 1st inst., for part of balance of ac- count $1,988 20 Interest added, 93 days 30 81 16 zzzmi 14 Bought of Strang, Adriance, & Co., 50 shares Erie Railroad Stock, at $80 per share $4,000 00 Delivered to them in payment, our Draft on Joseph Eaton & Co., Boston, at three days* sight, for 4,020 10 Exchange allowed, at J °|o discount 20 10 18 Received from Joseph Eaton & Co., Boston, account- sales of our Consignment to them of April 13th : Net proceeds (( li Received from Joseph Eaton & Co., Boston, account- current showing a balance of Interest in their favor of $ 25 00 Also, their Draft, No. 21, at 60 days, on Eagle & Hazard, accepted, for balance due us 554 90 20 ~ Delivered our Note, No. 17, at seven months, to the Atlantic Mutual Insurance Co., for 2 °lo premium on $20,000 in open policy 23 Shipped per Steamer Panama, Bailey, consigned to Simmons, Hutchinson, & Co., San Francisco, to be sold for the joint account of Henry Austin and ourselves, as follows : — 100 boxes refined Sugar $1,150 00 80 M. Havana Segars 1,440 00 10,500 Spanish Dollars $10,500 00 At 1 % premium 105 00 10,605 00 12 Forward ; .... 13,195 00 89 $ 500 00 2,019 01 4,000 00 4,600 00 579 90 401 25 V..A 18 14 15 New York, May 23, 1850. Brought $13,195 00 Paid Cash for Shipping expenses 125 00 Insured at the Atlantic Mutual Insurance Co., $14,654, at 2 ^Iq prem. entered on our Policy 293 04 Of which our half is 6,806 52 Of which Henry Austin's half is 6,806 52 30 Bought Merchandise during this month, as per Invoice- Book, as follows : — On our Notes, viz. : — No. 14 to T. Owen & Son 4th, $300 00 " 15 to " " 6th, 200 00 " 18 to Trujillo & Barreiras . . 25th, 320 00 " 19 to Harmony's Nephews & Co 26th, 630 00 " 20 to Spofford, Tileston, & Co 28th, 270 00 1,720 00 m On Account — Of Henry Austin 5th, $200 00 •* " " 16th, 100 00 $300 00 Of James Truman 10th, 212 00 Of Edward G. Fail & Co 13th, 375 00 Of William Evans 18th, 110 00 " 25th, 175 00 " " " 30th, 135 00 420 00 Of Barclay & Livingston 22d 550 00 $13,613 13,613 90 04 04 3,577 00 15 New York, May 30, 1850. 15 Sold Merchandise during this month, as per Sales-Book, as follows :— For Notes, viz. ; — No. 22, on A. G. Beck 15th, $352 00 " 23, on W. F. Mott, Jr 20th, 415 00 " 24, on A. Aranguran 27th, 611 00 1,378 00 On Account — To S. H. Lovell 12th, $310 00 u i. « 17th, 19000 $500 00 To Paul Harris 18th, $150 00 u u a 28th, 150 00 « 30th, 255 00 $555 00 If To Oliver Otis & Co " Henry Austin ** Barclay & Livingston .20th 562 50 .22d, 337 50 29th, 175 00 « Received Cash during this month, as per Cash-Book, as follows : — For Merchandise, amount of cash sales — this month Sl,266 00 I For Notes due and discounted this month, viz.:— No. 12 for $707 35 u 14 for 50000 1,207 35 For Discount and Interest, amount 10 50 Of Oliver Otis & Co 23d, $200 00 30th, 150 00 350 00 « « «« Of Henry Austin 28th 150 00 Of Charles Lawrence 28th 167 07 Of S.H.Lovell 30th 300 00 19 $ 3,508 Ot) 3,450 ;92 91 # *- ■ ir I m ,f »•' t ; I I 20 15 New York, May 30, 1850. Paid Cash during this month, as per Cash-Book, as lollows : — ForMerchandise, cash purchases this month.. $610 50 For our Notes, due this month, viz.— No. 14 for $300 00 " 15 for 200 00 500 00 For Discount and Interest, amount 12 75 For Store-Expenses, amount 75 95 To Thomas Blanchard 15th, $ 98 23 30th, 100 00 198 23 To Paul Harris, his Draft at sight— 5th, for $2,500 00 10th, 500 00 3,000 00 To C. C. Marsh 15th, 2OO 00 " 30th, 100 00 300 00 To William Evans 12th 20O 00 " C.J.Martin i6th 150 00 • John Sims 16th 100 00 — — — — __ « . ____,^ _____^_ An error occurred in a journal entry of April 30 (page 12), m which Paul Harris was charged for a balance of interest of $6.67 when he should have been credited 92 J $5,147 43 IS 34 \ I NOTE. In this book consists the science of hook-keeping — its entries are composed from those of the day-hook, and emhrace only our debtors and creditors, ar- ranged to facilitate our -posting or transferring them to the leger. This method, having the day-hook and journal entries separate, relieves the book-keeper of a double task ; for when they are united, he has not only to point out the debtors and creditors of a. transaction, but has also, and at the same moment, to state all the circumstances, which must of necessity be done in broken sen- tences. But by this plan or arrangement the book-keeper may give a pure and simple relation of any transaction and leave the debtors and creditors for a separate entry and future consideration. In examining an account in the leger, we need not go through this book to the day-book, but we may refer, for any explanations, from the leger (by the dates), directJv to the day-book entriea New York, January 5, 1850. 2 5 4 10 1 1 6 1 1 6 2 10 4 5 4 2 4 11 4 4 11 4 2 4 6 Sundries Dr. To Sundries. Cash $38,000 00 Bills Receivable 4,670 00 Merchandise 3,125 00 Charles Lawrence 140 00 To Thomas Blanchard 28,000 00 « C.C.Marsh 17,935 00 i< Sundries Dr. To Bills Payable. Thomas Blanchard $1,080 00 C.C.Marsh 1,230 00 Store-Fixtures To Cash, Dr. 8 Paul Harris Dr. To Merchandise 10 Bills Receivable Dr. To Merchandise .... Cash 12 _ Dr. To Merchandise 13 Olivo: Otis & Co. Dr. To Merchandise 14 Merchandise Dr. To Henry Austin ... «« Merchandise To Cash. Dr. 16 Merchandise Dr. To Bills Payable 95 $45,935 00 45,935 2,310 325 500 125 2,000 1,500 800 00 00 300 00 00 00 00 00 00 00 2,100 00 New York, January 16, 1850. 4 2 4 12 2 11 5 2 2 4 5 10 2 12 11 6 4 12 2 4 11 13 5 2 7 Merchandise Dr. To Sundries. To Cash $2,000 00 " Merchandise 1,200 00 17 James Truman To Cash Dr. _ 19 Sundries Dr. To Oliver Otis & Co. Bills Receivable $1,000 00 Cash 1,000 00 20 Cash Dr. To Merchandise 21 Bills Receivable Dr. To Paul Harris 22 Cash Dr. To James Truman . . . It Henry Austin Dr. To Bills Payable 24 Sundries Dr. To Merchandise. S. H. Lovell $250 00 Cash 160 00 26 Sundries Dr. To Merchandise. Oliver Otis & Co $200 00 William Blakeley 200 00 28 Bills Receivable Dr. To Sundries. To Cash $2,000 00 " Interest 12100 $ 3,200 1,000 00 2,000 250 325 1,000 1,500 410 400 2,121 H 96 00 00 00 00 00 00 00 00 00 New York, January 30, 1860. 6 2 Bills Payable To Cash Dr. February 2. 6 4 2 7 8 2 16 4 2 5 4 13 2 8 4 10 5 2 13 5 4 13 6 2 Bills Payable Dr. To Sundries. To Merchandise $550 00 « Cash 525 32 Discount 4 68 it tt $ 1,230 00 Store-Expenses To Cash Dr. Shipment to New Orleans Dr. To Sundries. To Merchandise $1,722 22 «« Cash 100 00 Bilb Receivable Dr. To Merchandise Sundries Dr. To William Blakeley. Cash SlOO 00 Profit and Loss 100 00 12 Merchandise Dr. To Sundiies. To Charles Lawrence S 140 00 " Bills Receivable 1,000 00 - Cash 100 00 tt William Blakeley Dr. To Bills Receivable . 13_ Merchandise Dr. To Sundries. To Walter Howard $4,888 89 " Bills Payable 1,222 22 " Cash 422 00 13 97 1,080 00 65 00 1,822 22 320 00 200 00 1,240 00 500 00 6,533 11 5 8 13 7 13 6 6 4 13 4 2 9 4 14 4 4 5 6 4 5 2 12 6 4 5 2 7 New York, P^ebruary 13, 1850. Sundries Dr. To Sundries. Bills Receivable $251 37 Profit and Loss 250 00 To William Blakeley 500 00 " Interest 1 37 16 Walter Howard Dr. To Bills Payable _. 17 Bills Payable Dr. To Merchandise 20 Walter Howard Dr. To Sundries. To Merchandise $2,730 00 " Cash 160 15 " Commission 84 14 «i Merchandise Dr. To William Evans . . . 21 Merchandise Dr. To Merchandise « Bills Receivable Dr. To Bills Payable 23 _ Sundries Dr. To Merchandise. Bills Receivable $ 500 00 Cash 120 00 James Truman 1,000 00 $ 501 501 24 Bills Receivable Dr To Merchandise « Sundries Dr. To Bills Receivable. Cash $1,969 00 Discount 31 00 98 ■li 4,444 1,500 2,974 1,260 1,530 800 1,620 2,000 2,000 37 37 44 00 29 00 00 00 00 00 00 New York, February 25, 1850. 5 ♦1^ 7 13 9 2 14 12 7 2 16 4 6 10 7 16 6 2 7 2 Schooner Josephine Dr. To Sundries. To Walter Howard $2,222 22 " Exchange 177 78 « Cash 2,600 00 26 William Evans Dr. To James Truman . . « Schooner Josephine To Cash... Dr. $ 5,000 : 00 27 Shipment to Port au Prince Dr. To Sundries. To Merchandise $1,200 00 " Bills Payable 2,190 00 " Charles Lawrence 288 00 " Schooner Josephine 230 00 28 Shipment to Port au Prince Dr. To Sundries. To Bills Payable $ 81 56 » Cash 120 00 <( 1,000 00 155 00 3,908 00 Schooner Josephine To Cash... Dr. 4 11 10 8 2 March 2. Sundries Dr. To Merchandise. Oliver Otis & Co $500 00 Charles Lawrence 288 00 201 56 26 00 ft Store-Expenses To Cash Dr. 788 45 99 00 00 r I f I |i G New York, March 3, 1850. 17 2 2 17 il7 !io ! o De Nones' Consignment Dr. To Cash (I Cash Dr. To De Nones* Consignment . - 4 Sundries Dr. To De Nones* Consign't. Charles Lawrence $175 00 Cash 300 00 $ 460 456 -_5 5 5 11 7 17 2 10 12 4 17 6 2 2 12 2 17 4 17 Cash Dr. To Bills Receivable . . 475 00 00 2,670 « Bills Receivable Dr. To Sundries. To Oliver Otis & Co $700 00 " Interest 7 35 De Nones' Consignment Dr. To Sundries. To Cash S45 00 " Charles Lawrence 10 00 S. H. Lovell Dr. To Sundries. To Merchandise $245 00 " De Nones* Consignment 150 00 (( Bills Payable To Cash Dr. r- To Bills Receivable. . 3,799 27 2,020 00 18 2 I Cash r>r. 10 To Paul Harris 20 - 2 18 10 18 10 To Cash. Sundries 1^**. 251 37 2,000 21 Company 1 Merchandise Dr. To Paul Harris 00 00 -23 6 2 18 7 1 2 Sundries Bills Payable Cash Dr. To Sundries. 82,100 00 909 10 1,187 50 To Company 1 Merchandise 3,000 00 «♦ Interest ^ ^Q 25 3,009 3,009 C. C. Marsh To Cash Dr. 300 10 10 00 101 r^ m i Nfitv York, Ma T0 Aarch V 26, 1850. 5 9 18 2 18 14 5 2 18 4 2 18 9 8 10 8 Sundries Dr. To Sundries. Bills Receivable $4,444 44 Exchange 355 56 To Company 1 Merchandise 2,400 00 «' Cash 2,400 00 27 Sundries Dr. To Comp. 1 Merchandise. William Evans $260 00 Bills Receivable 500 00 Cash 440 00 -28 Sundries Dr. To Comp. 1 Merchandise. Merchandise $1,248 50 Cash 1 50 .30 8 2 4 14 2 17 12 11 Company 1 Merchandise Dr. To Sundries. To Commission $ 196 25 " Store-Expenses 39 00 " Paul Harris 3,807 37 " Profit and Loss 619 88 April 1. Store-Expenses To Cash Di Merchandise Dr. To Sundries. To Lockhart & Arrott $2,020 00 " Cash 300 00 $ 4,800 I 00 Sundries Dr. To Fisher's Consign't. S. H. Lovell $1,350 00 Oliver Otis & Co 810 00 tfm 4,800 00 1,200 00 1,250 00 4,662 462 50 00 2,320 2,160 00 00 New York, April 7, I860. 2 7 15 17 14 2 4 Cash Dr. To Interest 8 I Irvine Fisher Dr. To Fisher's Consignment. $ 21 10. Joseph De Nones Dr. To Sundries ToCash «22 00 « Merchandise 40 00 11 5 15 12 2 7 16 4 17 2 11 15 2 Sundries Dr. To Sundries^ Bills Receivable ^'35000' Irvine Fisher 1'350 00 To S.H. Lovell 1.350 00 " Cash 1'322 33 " Discount 27 67 13 Shipment to Boston Dr. To Sundries ^ to Merchandise ^2,660 00 ** Fisher's Consignment 720 00 « Cash 120 00 14 Sundries l^r. 1 o uiiver v^us o. ^ Irvii^ Fisher ^^10 Cash ' 16 Dr. To Oliver Otis & Co. 00 500 00 1 2 17 2 17 17 9 8 15 Thomas Blanchard Dr. To Sundries. ToCash $500 00 " Fisher's Consignment 43 20 Cash 16 Dr. To Fisher's Consignment. 14 4 5 12 10 11 11 19 3 4 6 7 11 11 10 12 3 4 6 7 8 I 10 1 14 20 20 7 10 New York, May 30, 1860. Sundries Dr. To Merchandise. Bills Receivable 81,378 GO S. H. Lovell 17th, 500 00 Paul Harris 30th, 555 00 Oliver Otis & Co 20th, 562 50 Henry Austin 22d, 337 50 Barclay & Livingston 29th, 175 00 — it Cash Dr. To Sundries. To Merchandise $1,266 00 " Bills Receivable 1,207 35 " Discount and Interest 10 50 " Oliver Otis & Co 30th, 350 00 " Henry Austin 2Sth, 150 00 " Charles Lawrence 28th, 167 07 " S. H. Lovell 30th, 300 00 —————— ————^■^— —— *' — i—— _— ___________^__ Sundries Dr. To Cash. Merchandise $ qiq 50 Bills Payable 500 00 Discount and Interest 12 75 Store-Expenses 75 95 Thomas Blanchard 30th, 198 23 Paul Harris lOth, 3,000 00 C. C. Marsh 30th, 300 00 William Evans 12th, 200 00 C. J. Martin i6th, 150 00 JohnSims i6th, 100 00 «( Interest Dr. To Paul Harris 108 $ 3,508 3,450 5.147 13 V 00 92 4S 34 / NOTE. This is the Book of Accounts ; the book that shows the results of all our mercantile transactions, condensed and brought together under their different heads. On one folio we may see what our merchandise cost and what it sold for ; on another, the amount of our notes issued and redeemed ; on another, the amounts a person owes us and those we owe him. Thus we may turn over its pages and see at one view the amounts that all persons, properties, or objects, and branches of our business, owe to us or have cost us, and all that we owe to them or that they have produced us. The balance sheet (designed to show the state of our affairs), exhibiting our assets and liabilities, our gains and losses, and our net capital, is made out from this book. The trial balance (a paper made to prove the postings, additions, and subtrac- tions in this book), is made out from this book, monthly or quarterly. The entries in this book are brought from the journal, daily, weekly, or monthly, as occasions require. Accounts-current are made from this hook with reference from the accounts (by dates) direct to the day-book for explanations. Index. Austin, Henry H K. Evans, William 14 Exchange ^ Erie Railroad Stock 21 Eaton & Co., Joseph 20 B. Bills Receivable 5 Blanchard, Thomas 1 ; Bills Payable ^\ Blakeley, William 13 Balance of April 30, 1850 19 Barclay & Livingston 19 C. Cash 3,2 Commission 9 Company 1 Merchandise 18 Company 2 Merchandise 18 •» D. Discount and Interest 7 De Nones' Consignment 17 De Nones, Joseph 14 F. Fisher's Consignment 17 Fisher, Irvine 15 Fail & Co., E. G 18 G H. Harris, Paul.... Howard, Walter .10 .13 111 ! k Index. I.J. Interest 7 Insurance 21 N. K. 1 O Otis & Co., Oliver 11 Lawrence, Charles 10 Lovell, S. H 12 Lockhart & Arrott 14 P. Profit and Loss 8 * • M. * • Merchandise 4 Marsh, C.C 1 Martin, C. J 20 i 112 Index. I Ruiz, Joseph 16 V. s. Store-Fixtures 6 Store-Expenses 8 Shipment to New Orleans 16 Schooner Josephine 7 Shipment to Port au Piince 16 Shipment to Boston 16 Sims, John. 20 Shipment to San Francisco 21 T. Truman, James 18 U. W. Walker & Co., H. B. 15 Z. 15 113 1 Dr. 1850. Jan. April IBSO. May 5 15 30 30 To Bills Payable •*' Sundries " Balance To Cash Dr. 1890. Jan. March April 5 26 30 1850. May 30 To Bills Payable " Cash " Balance To Cash !H Thomas 1 9 13 $ 1,080 543 31,144 32,767 15 t 198 00 20 20 40 28 Christopher 1 7 15 8 1,230 I 00 300 I 00 20,975 93 22,505 93 S 300 I OC Blanchard. 18M. Jan. April it 6 I By Sundries. 30 I " Interest. I860. April " Profit and Loss 30 1 By Balance. C. Marsh. 1880. Jan. April 30 «t 30 By Sundries ** Interest ** Profit and Loss r I ■■III mmmin i ■ I i^mmmmm 1850. { April ^ 30 By Balance 115 Cr. 1 12 12 $28,000 494 4,273 32,767 31,144 00 16 24 40 20 Cr. I I If I Dr. Cash. Cr. • ! 1850. Jan. 5 M 12 «• 19 •« 20 M 22 «< Feb. 24 9 « 23 « 24 March 3 •1 4 <• 5 <« 9 «• 10 •1 .12 «< 16 u 18 u 23 l« 27 «« 28 April 7 it 14 M U M 18 To Sundries " Merchandise " Oliver Otis & Co "- . • *• Merchandise " James Truman " Merchandise 40,096 00 " William Blakeley " Merchandise " Bills Receivable 4S,TM 00 " De Nones* Consignment " De Nones* Consignment " Bills Receivable " S. H. Lovell " De Nones* Consignment " Sundries " Bills Receivable " Paul Harris " Sundries " Company 1 Merchandise " Company 1 Merchandise *■ '' M/M5M " Interest ** Oliver Otis & Co " Fisher's Consignment " Merchandise Carried forward. 116 1 1 2 2 2 2 3 4 5 6 6 6 6 6 7 7 7 7 8 8 8 9 9 10 $38,000 125 1,000 250 1,000 160 100 120 1,969 456 300 2,670 250 1,233 850 251 2,000 909 440 1 21 500 316 637 00 00 00 00 00 00 00 00 00 00 00 00 00 27 00 37 00 10 00 50 00 00 80 50 53,560 ISftt. Jan. «« If M «f « Feb. u u M it U M U «l March (( <• II •I 11 April II M II II II 7 14 16 17 28 30 2 2 4 12 '13 20 25 26 28 28 2 3 7 9 20 25 26 2 2 10 11 13 15 18 By Store-Fixtures " Merchandise " Merchandise " James Truman - " Bills Receivable " Bills Payable « Bills Payable ** Store-Expenses '» Shipment to New Orleans . . " Merchandise " Merchandise " Walter Howard " Schooner Josephine " Schooner Josephine " Shipment to Port au Prince. " Schooner Josephine • " Store-Expenses " De Nones* Consignment — " De Nones* Consignment- . . " Bills Payable ** Sundries « C.C. Marsh " Sundries " Store-Expenses " Merchandise - " Joseph De Nones " Sundries " Shipment to Boston " Thomas Blanchard " Irvine Fisher 7,990 00 ii^an«7 t3,S9T91 54 Carried forward . i:7 1 1 2 2 2 3 3 3 3 3 3 4 5 5 5 5 5 6 6 6 7 7 8 8 8 9 9 9 9 10 300 800 2,000 1,000 2,000 1,230 525 65 100 100 422 160 2,600 155 120 26 45 460 45 4,444 4,000 300 2,400 462 300 00 00 00 00 00 00 32 00 00 00 00 15 00 00 00 00 00 00 00 44 00 00 00 00 00 22 I 00 1,322 i 33 120 I 00 500 00 245 00 26,269 24 I I 18S0. April « Paul Lawrence. 18S0. Feb. *i March April 1850. May 12 27 7 30 28 Harris. 1850. Jan. March 6 4,988 67 20 87 20 00 00 7,319 i 1,988 555 3,000 (t •« 18S0. April May 21 18 21 30 Cr. 10 By Merchandise " Shipment to Port au Prince. " De Nones' Consignment •• Balance , By Cash 1 1 3 $ 140 5 288 6 10 12 167 605 14 ll S 167 • I Cr. By Bills Receivable 2 " Cash " Company 1 Merchandise 7 7 «i Company 1 Merchandise 8 30 30 By Balance " Interest. 14 . I3S 00 00 00 07 07 07 11 Dr. Oliver i! To Merchandise " Merchandise " Merchandise 5 •* Fisher's Consignment 8 1 $2,000 2 200 500 810 To Merchandise 00 00 00 00 3,610 00 14 $ 562 50 Otis & Co. 1850. Jan. March April Blay 19 5 14 By Sundries " Bills Receivable " Sundries 30 By Cash Cr. 11 2 6 9 14 $ 2,000 700 810 3,510 00 00 00 00 t 350 00 1S50. Jan. Dr. 22 To Bills Payable. 1860. May I 23 - I 22 To Sundries. " Merchandise 134 Henry 2 13 14 $ 1,500 1 6,806 337 00 52 60 Austin. I860. Jan. ^ 14 I860. May M I 16 28 By Merchandise 135 Or. By Merchandise 13 $ 300 00 " Cash 14 150 i OO 1 ;. >^ Mih 12 1850. Jan. March April I860. April May Dr. James ■^^^^^^ 2 $1,000 " Merchandise 4! j qoo -u_ ■ ■■ - ' ■ ' Dr. -..■■-.,,... ,^ 24 9 6 To Merchandise , " Sundries " Fisher's Consignment. 30 17 To Balance " Merchandise 166 2,000 00 00 00 S. H. 2 6 8 $ 250 00 395 00 1,350 00 14 1»995 00 $ 395 00 500 00 Truman. 1850. Jan. Feb. 1850. May 22 26 By Cash " William Evans. 10 I By Merchandise LOVELL. By Cash ... " Sundries. " Balance . By Cash 137 Cr. 12 2 5 14 1,000 liOOO 2,000 Of 00 00 $ 212 00 Cr. 14 $ 300 00 13 i M i 1850. Aoril Dr. 1BB0> Jan. • 26 Feo. IS To Merchandise . . . ** Bills Receivable Dr. Feb 16 To Bills Payable. 20 ** Sundries. 30 To Balance 138 WiLLIA 2 3 $ 200 00 500 00 700 1 00 Walter 4 $ 4,444 44 4 2,974 29 7,418 71 $ 307 62 Blakelet. 18S9. Feb. I 9 By Sundries . 13 " Sundries *« («' Howard, London. 1850. Feb. April 13 I By Merchandise 25 *' Schooner Josephine *• Balance :39 Cr. 13 3 4 $ 200 00 500 00 700 i 00 Cr. 3 1 4,888 89 5 I 2,222 22 307 7.418 62 %- 71 I 14 Dr. 1850. Feb. 26 March 27 I860. May 12 To James Truman It Company 1 Merchandise To Cash Dr. 1850. March 16 To Shipment to New Orleans Dr. 140 William 5 8 14 $ 1,000 260 1,260 $ 200 00 00 00 00 LoCKHART $ 2,020 00 Joseph 1850 April 10 30 To Sundries ........................ 9 11 $ 62 3,469 00 " Sundries 32 3,531 32 E Ivans. Cr. 14 1850. Feb. 20 30 Bv Merchandise .............••••••■• 4 13 $ 1,260 00 1,260 00 1880. May By Merchandise $ 420 00 & ARROTT. NewOrleanB. 1850. April By Merchandise D E Nones, cadi*. 141 Cr. 8 $ 2,020 00 Cr. 1850. March 14 By De Nones* Consignment 7 $3,531 32 3,531 32 15 1850. April 8 11 14 16 Dr. To Fisher's Consignment. " Sundries " Oliver Otis & Co " Sundries Dr. I< I I -i! lli 17 Dr. 1850. March M M 3 7 14 Dr. 1850. April 16 To Sundries. 146 De Nones' To Cash . . . " Sundries. " Sundries. Dollars Dollars 6 6 7 $ 460 55 3,799 4,314 Fisher's i 9 00 00 27 27 $4,680 ; 00 4,680 ' 00 Consignment. Cr. 17 1850. March fi «« • >-• o u c 1 Sold to Paul Harris, at 60 days — 250 doz. common Curry-Combs at S .68 $170 00 10 gro. Allison's Britannia Teaspoons 2.12J 21 25 30 doz. Duff Razor Strops 2.12J 63 75 1000 qr.-in. Can's Steel Augers 07 70 00 10 Sold to William Blakeley, at 30 days — 1000 qr.-in. Augers at $ .07 $70 00 100 doz. Curry-Combs 87 J 87 50 20 " Pitchforks 5.50 110 00 10 " Manure Forks 9.50 95 00 5 " Long Shovels 7.50 37 50 20 " Wool Cards 4.00 80 09 10 gross Gilt Vest Buttons 78 7 80 487 80 2J per cent, advance 12 20 11 Sold to S. H. Lovell — Cash. 3 Patent Balances at $10.00 $30 00 6 doz. Coffee-Mills 5.00 30 00 2 doz. Collins' Axes 20.00 40 00 3 " Britannia Tablespoons 5.00 15 00 5 " " Teaspoons 2.00 10 00 $ 325 00 500 00 125 OC N.O. B&M E. Invoice of Hardware shipped per Brig Franklin, Kay, consigned to Lockhart & Arrott, New Orleans, to be sold on our account, viz. : — 15 Boxes. 20 doz. Shovels at $7.50 $150 00 20 " Spades 7.50 150 00 50 boxes Scythe-Stones 3.25 162 50 40 doz. Grass Scythes 12.00 480 00 20 " Cora " 6.30 126 00 30 patent Balances 10.00 300 00 20 Mill Saws 4.75 95 00 20 Cross-Cut Saws 3.00 60 00 20 doz. Pitchforks 5.50 110 00 10 " Coffee-Mills 5.00 50 00 55 pr. Waffle-irons .62 J 34 47 1 ream Hardware Paper 4 25 1,722 22 ________^____________ Charges. Cartage and labor $20 33 Packing Boxes 25 63 Insurance on $1,768, at 3 per cent., and policy 54 04 $100 00 New York, February 4, 1850. $1,822 22 17U 171 COMMISSION SALES-BOOK. B. & M. 1850. Note. — This book contains a minute description of the merchandise sold for account of others. The entries in it are drawn from the sales-book. From this book we make the account-sales that we may have to render to those persons for whom we have sold goods. 1 1850. Mar. u tt «l Dr. Sales of Fruit for Account 14 14 14 To Cash, paid Duty and permit paid Freight and primage paid Cartage and labor " C. Lawrence, paid him for damages " Cash, paid sundries for damages *' Store-Expenses, Storage, and Advertising " Commission on $4,314.27, at 5 o|q " Joseph De Nones, for amount of net proceeds due May •25, 1850 • The Account-sales which we render to Mr. De Nones, made out from the above, and the calculation for averaging this account, to ascertain when the net proceeds are due, will be found among the Forms and Calculations at the end of the book. 174 $ 340 108 12 10 45 52 215 00 00 00 00 00 24 71 3,531 32 4,314 27 OF Joseph De Nones, cadix. Cr. 1850. Mar. u <• «< M M 4 9 10 10 By Cash, 100 boxes Lemons at $3 00 52 boxes Oranges 3 00 " C.Lawrence, 25 boxes Oranges, 60 ds. 3 00 200 jars Olives 50 " Cash, 100 boxes Oranges 3 00 " S. H. Lovell, 25 boxes Lemons, 90 ds. 3 00 25 boxes Oranges 3 00 " Cash, at Auction — 150 boxes Lemons at $5.00 $750 00 110 boxes Oranges 3.80 418 00 220 jars Olives 50 110 00 ],278 00 Auctioneer's Commission 3^^\q 44 73 By Merchandise, 4,000 jars Olives, 4 mos. . . at .50 $ 300 156 75 100 300 75 75 OC 00 00 00 00 00 00 1,233 2,000 27 OC 4,314' 27 !75 1850. Mar. M . 25.1 Exch. for dCSOO stg. New York, February £t>, 1850. Sixty days after sight of this our first of exchange (second, third, and fourth, of same tenor and date, unpaid), pay to the order of Capt. Caleb Davis five hundred pounds sterling, value received, and charge the same to our account. _, « ,, Blanchard & Marsh. To Walter Howard, London. Note — The above is one of the set. A bill of exchange consists of four drafts, in order to expedite the forwarding and collecting ; one being paid, the others become null DRAFT. (From transaction of Jan. 5.) $1,080 00. ^^'^ Boston, December 25, 1849. Sixty days after sight, ^iy to the order of Henry Austin, one thou- sand and eighty dollars, ve^iie Received, and charge the same to our account ^ ^1 T. Perkins & Co. To Thos. Blanchard, Ne^ ?ork. DRAFT AT SIGHT. $310 01 (From tranFftction of Apl. 14.) iioo ? New York, April 14, 1850. At sight, without grace, pay to the order of Blanchard & Marsh, three hundred dollars, value ^ceived, and charge the same to our ac- count. 3 Oliver Otis & Co. To Irvine Fisher, Esq., Nwv York. AN ORDER. (From transaction of March 2.) ^288 o|ioo New York, March 2, 1850. Messrs. Blanchard & Marsh will please deliver to the order of W. Blakeley such goods as he may choose, to the amount of two hun- dred and eighty-eight dollars, and charge the same to Charles Lawrence. 188 MERCANTILE FORMa ! AccouKT-SaLES of Invoice of Fruit received per Brig " Clio," sold by order and for account of Joseph De Nones, Cadiz. Mar. «< M <« «l M M 3 3 4 4 4 9 9 100 boxes Lemons, at $3.00, cash 6300 00 52 boxes Oranges, 3.00 " 156 00 5 I " 10 " ! 10 '• ' 10 25 boxes Oranges, 200 jars Olives, 100 boxes Oranges, 25 boxes Lemons, 25 boxes Oranges, 150 boxes Lemons, 110 boxes Oranges, 220 jars Olives, 3.00, 60 days 75 00 .50 60 " 100 00 3.00, cash 3.00, 90 days 75 00 3.00 90 " 75 00 5.00, cash 750 00 3.80 " 418 00 .60 " 110 00 10 Sold at auction 1,278 00 Auctioneer's commission 3J <*|q 44 73 4000 jars Olives at .50, 4 mos. Charges. Duties and permit $340 00 Freight and primage io8 00 Cartage and labor X2 00 Refunded for damages 55 oo Storage and advertising 52 24 Commission on $4,314.27, at 5 o|o .....].. 215 71 Net proceeds, due May 25, '50 E.E. New York, March 14, 1850. Blanchard & Marsh, Per John Sims. Note.— The lalei in thii account being made on different ternu and at different time«, a calculation is neceaaary in order to aacertain when the net proceeds will be due: the account must be averaged. The calculation will be found among those under the head of Eotu^ tion of Paymentit, at the end of the book— example 5. II $ 456 175 300 150 1,233 00 00 00 00 27 2,000 1 00 4,314 782 27 3,531 95 32 MERCANTILE FORMS. 189 Account-Sales of 1,300 barrels Flour, sold by Blanchard & Marsh. in joint account w^ith Paul Harris. 1850. Mar. *( M 23 26 500 barrels Flour, 400 ii " 27 i 200 " 28 200 u « «t M at $6.00, cash 6.00, 60 days 6.00, 60 " ..$500 00 Cash 700 00 3 months . Charges. Of which your half is (due May 3, '50) E.E. New York, March 30, 1850. Blanchard & Marsh, Per John Sims. Note.— The calculation required to average this Account-sales, ID ascertain at what date the net proceeds will fall due, will be found amon^ the •• Calculations," at the end of the book— example 4. $3,000 2,400 00 00 1,200 I 00 1,250 00 7,850 Storage on 1,300 bbls. 1 mo., at 3 cts $ 39 00 Commission on $7,850, at 2J o|o 196 25 235 Net proceeds, due May 3, *50 7,614 00 25 75 3,807 ?n H IM 190 18M. Jan. March 4« 1800. Dr. MERCANTILE FORMS. Charles Lawrence in Account 5 2 .. April \0 To Balance due C. C. Marsh To your draft at sight, in favor of William Blakeley To Merchandise, per bill rendered To Balance t 140 288 175 603 $ 165 00 00 00 OC 00 NoTJt.— The above ib an Accoant-cuirent of the most aimple class, being without interest. It is made oat from the Leger, referring by the dates to the entries in the Day Book, for aoch explanations of the loma aa may be thought neceaaary. MERCANTILE FORMS. Current with Blanchard & Marsh. 191 Cr. 1850. Feb. |q 30 To Balance 115 69 67 INTST. $2 NoTi.— The purchMes and sales of merchtn. dke in the above accoont-current are supposed to be without credit or time ; consequently we count the days from the dates of the pnrchasea and sales up to the day on which we make tfie account (April 30). Great care must be taken not to calculate interest where it is not owed. If a sum is not due on the date of the entiy, the explanation should show when it is due. Error in the above intrest of 24 ctat 68' 83 1 42 6 * % 93 4t:.--SJt- AMOUNTS. $ 140 288 175 605 00 00 00 07 — I 07 $ 167 07 ^ MERCANTILE FORMS. Current with Blanchard & Marsh. 19S Cr. DATES. 1850. (n i INT ST. Feb.! 12 i By our draft at sight, in favor of Ha- i ven & Smith I 77 ■; . . I 27 j By Merchandise, per bill i 62 «i Mar. 7 By allowance on bill of 4th inst. Apl. 30 I By Balance of Interest Apl. 30 By Balance due this date, E.E. Nbw York, Apl. 30, 1850. t ' 54 96 « U. 93 AMOUNTS. 80 $ 97 09 07 140 00 288 1 00 10 00 167 07 605 07 I t L IM De. MERCANTILE FORMS. Christ*- C. Marsh in Account DATES. IBM). Jan. Mar. Apl. 5 To your Note in favor of T. P. Cope & Son, due Jan. 30, 1850 25 I To C ash 30 \ To Balance of Interest 30 To lialauco E. E. New York, Apl. 30, 1850. m 90 36 Note. — An Account-cmrent is a itatement which we often have occasion to render to per- sons with whom we have been doing basinets. It is intended to explain to the person to wlwm it is rendered, liow his accoant stands in oar books, and to show what balance is doe him or as. INT ST. 18 1 297 317 45 80 69 94 AMOUNTS. $1,230 300 16,702 18,232 00 00 69 MERCANTILE FORMS. CUEBENT WITH BlANCHARD & MaRSH. 195 Cr. 69 DATES. 1850. Jan. 5 c< 5 M 5 it 5 Apl. 1850. Apl. 30 30 By Cash By Oliver Otis & Co.'s acceptance, due March 4, 1850 By Merchandise By Charles Lawrence's balance of account By Balance of Interest at 6 ®|o By Balance There are three way« of making oat these ac> coonts, which are used according to circamstan- ces:— 1st A simple statement of the account, icHhoul interest. 2d. A statement of the account, with interest calculated on each sum. 3d. A statement of the account, showing by ar- erage when the balance was or will be doe. The above account belongs to the second class. It is made out for one of the partners, in order to ascertain the amount of interest on his capital, under the supposition that the partners were to be allowed interest on their resi)ective capitals. The balance of interesl in this account (S297.69) is carried to the Day-Book (Apl. 30), journalized, and posted to the accounts in the Leger. The account of the other partner, when made out, will show a balance of interest of S493.66 115 57 115 115 INT ST. 230 59 317 00! 37 89 68 94 AMOUNTS. $12000 2,670 3,125 140 297 18,232 00 00 00 00 69 16,702 69 69 lU Dr. MERCANTILE FORMS. Paul Harris in Account DATES. Jim. 8 To Merchandise, at 60 days, per bill I rendered, due March 12, '50 ... . Mar. 20 To Cash, paid your J bill of Flour in ! joint account Apl. j 30 To Balance of Interest in red " i 30 To Balance of Interest Apl. 30 To Balance due this date E.E. New York, Apl. 30, 1850. m 49 41 NoTK. — Tbe al)ov»' balance of interest ($6.67^ M carried into the D«y-Hook, hut journalized and poited wrong iu order to artord an example of correcting a class of errors thai require Day- Book and Journal entries to correct them. The correction in this case is made by the last entry ■nder date of May. .ilEu'iki:. INT ST. $2 13 1 6 24 65 67 90 67 89 AMOUNTS. S 325 2,000 5,001 00 00 *^ MERCANTILE FORMS. 197 Current with Blanchard & Marsh. Cr. 54 7 326 I 54 Apl. 1S50. Apl. 30 30 30 By your Note, at 60 days from 8th, due March 12, 1850 By Cash By our -J bill of Flour in joint ac- count with you By your ^ net proceeds of sales in joint account, due May 3, *50 — By Balance of Interest, at 6 ®|o By Balance NuTK. — The at)ove account shows a suui ju tbe credit ($3,807.37) which is not due until May 3d, being 3 days after the date on which we make the account — April 30; the interest on which, therefore, must belong to the debtor side. When such is the case, we must calculate the interest from now until the time the sum is dte, and write the days and interest in red ink; and before adding the interest colamns, we must make an entry, on the debtor side, of the red-ink interesfT 1 -24 1 90 i 89 $5,001 54 k 198 MERCANTILE FORMS. Dr. Paul Harris in Account 1850. Jan. March April 8 20 30 To Merchandise, at 60 days, per bill rendered. . To Cash, paid for your } bill in joint account . . T«» Balance due April 22. IS.-iO $ 325 2,000 4.994 E. E. New York, April 30, 1850. 00 00 87 7,319 ^ MERCANTILE FORMS. Current with Blanchard & Marsh. 199 Cr. 1850. Jan. March f( •81 NoTit.— The above ia an Accouni current averaged. The one on the two preceding pavea is the same accoont made ap with interest. 1850. April <« J- h 30 30 By your Note, due March 12, 1850 By Cash By our \ bill in joint account with you By your \ net proceeds of sales in joint account due May 3, 1850 $ 325 00 2,000 00 1,187 1 50 By Balance due April 22, 1850 By Interest from April 22 to date — 8 days Note.— The above account, and the precedbg, are accounts, current made out for the same person, with a view to exemplify two of the common methods of drawing off an account-current, VIZ. : one with interest calculated on each euro, and the other by averaging to find tchen its balance is due. The one averaged shows a balance due April 22 ; now calculate and allow hiterest on this balance from April 22 to the 30th (the date to which the other account is made up), and the balances of the two accounts win agree— both showing a,sum,dtte Mr. Harris, at 30th April, of $5,001.54. The calculation of averaging this account will be found under the head of Equation r>/ Paymenl$~ex&mp\e 6. I J LETTERS. Note. — It is necessary to preserve copies of all our business letters ; for this purpose a letter-book is kept. Subjects of the following letters : — No. 1. — Circular on commencing business. " 2. — On ordering Goods. " 3. — On consigning Goods. " 4. — On rendering Account-Sales. " 5. — On drawing a Draft. " 6. — On rendering Account-Current, and requesting remittance. MERCANTILE FORMS. 201 [CIRCULAR.] No. 1. New York, January 5, 1850. Sir:— We, the subscribers, respectfully announce to you that we have formed a copartnership under the firm of Blanchard & Marsh, for the prosecution of a general commission and wholesale business ; and we take the liberty of assuring you that all business intrusted to our care, shall receive from us, personally, prompt and faithful attention. Having friends and correspondents at numerous commercial points, we possess facilities not often enjoyed by new establishments. We ar^ prepared to make liberal advances on consignments. Very respectfully, Your obfedient servants, , Blanchard & Marsa Thomas Blanchard will sign — Christr. C. Marsh will sign — References:—- Messrs. Moses Taylor & Co New York. Thomas Owen & Son ..." « Trujillo & Barreiras " «« Peiiasco Brothers Havana. Brown, Shipley, & Co.. .Liverpool. Hargos Brothers Vera Cruz. 26 202 MERCANTILE FORMS. Na2. Mr. Walter Howard, London. New York, January 5, 1850. Dear Sir : Please accept our order for forwarding to us per first vessel, the annexed list of dry goods of various patterns and of good quality ; for the amount of which you may draw at thirty or sixty days* sight. We contemplate consigning to you, about the 1st of February, an invoice of rice and pearl ashes, relative to which we solicit advice. Having commenced a general commission business (per our circular), we beg leave to solicit your favors, and pledge our honors as merchants' for the strict observance of your commands, and faithful performance of our duty. Very respectfully, I Your obedient servants. Blanchard & Marsh. MERCANTILE FORMS. 203 No. 3. Messrs. Lockhart & Arrott, New Orleans. New York, February 4, 1850. Gentn. : Enclosed we remit to you bill of lading and invoice of hardware, amounting to $1,822.22, which we consign to you per Brig Franklin, to be sold for our account. You will do us the favor to use all possible despatch in making sales and rendering account. We wish you to make returns for the above in sea-islands Cotton; you will therefore, without further advice, invest the net proceeds as soon as realized in that article, selected with your accustomed intelli- gence, and at the lowest market price. Keep us well informed of the state of your market ; we expect much business in that direction, and from rtie high esteem in which we hold your house, shall olace as much as possible under your care, expecting no less from you Very respectfully. Your obedient servants, Blanchard & Marsh. 204 MERCANTILE FORMS. Na4. Mr. Joseph De Nones, Cadiz. New York, March 14, 1850. Dear Sir : Enclosed you will find accoiint-sales of your Con- signment of Fruit, per Brig Clio : Net proceeds due May 25, 1850, $3,531.32. When your Fruit arrived, prices were very low, as appears by the first sales ; but a sudden demand arose, and we think we studied your interest by disposing of the remainder at auction. We await your further orders, grateful for those received, and remain Very respectfully. Your obedient senrants. Blanchard & Marsh. MERCANTILE FORMS. 205 Na5. New York, February 25, 1850. Mr. Walter Howard, ' London. Dear Sir : We have, under this date, drawn a bill on you, at twenty days* sight, in favor of Capt. Caleb Davis, for five hundred pounds sterling (dC500 stg.), which you will please accept, and oblige Your obedient servants, Blanchard & Marsh. No. 6. New York, April 30, 1850. Mr. Charles Lawrence, Philadelphia. Dear Sir : Annexed we present your account-current, with in- terest calculated to this date, showing a balance in our favor of $167.07; for which amount, if you find correct, please remit us a sight draft. Very respectfully. Your obedient servants, Blanchard & Marsh. 206 MERCANTILE CALCULATIONS. DISCOUNT AND INTEREST. Interest is a certain sum charged for the use of money ; it is alwavs calculated by the 100. Six per cent. (6 o|o) signifies $6 for the use of «100 tor one year (or one month, if so agreed). Seven per cent. (7 ^L) mf^ans $7 for the use of $100 during one year, or 7 cents for the use of 100 cents for a year. Therefore, by multiplying any sum by the rate l»er cent., and dividmg the product by 100, we obtain the interest on that sum tor one year. And, having the interest for one year, we may take Y ^^^ 6 months. 3" ^0^ 4 months. i for 3 months. i for 2 months. A fo'' I month. Example 1. What is the interest on $2,000 for one year and three days (the grace) at 6 °L per annum ? ^ ^ \, ^ , '" ^ (From transaction of Jan. 2a) Note.— To find the interest on any number of dollars for a year is the same simple calculation as to find the amount of any number of things at 6 or 7 cents each : 2,000 books, at C cents each, would amount to $120 ; so the interest on 2,000 dollars for one year, at 6 cents each would amount to $120. Rule (for years). Multiply the sum by the rate per cent, (here it is 6), and divide by 100 ; the quotient will be the interest in dollars, if the original sum be dollars, but if the original sum be dollars and cents, the quotient will be the interest in cents. f $2,000 $120,00 Interest for one year, one hun dred and twenty dollars. Rule (for days). Multiply the sum by the number of days, and divide the product by 6 ; the quotient will be the interest in mills, or in hun- dredths of mills if the sum be dollars and cents. $2,000 3 Divisor 6)6,000 $1>00>Q Interest for 3 days, 1 dollar. Cut off one figure for mills, and two for cents ; the rest will be dollars The interest, then, on $2,000 for 3 days is $1.00, and for one year and 3 days $121.00. ^ i MERCANTILE CALCULATIONS. 207 EXAMPLK 2. What is the interest on $1,080 for 26 days, at 6 "|o per annum ? (From transaction of Feb. 2.) $1,080 26 6480 2160 Divisor 6)28080 4,68,0 Interest for 26 days, $4.68. Example 3. What is the interest on $250 for 33 days, at 6 ^L per annum 1 (From transaction of Feb. 13.) $250 33 750 750 Divisor 6)8250 1,37,5 Interest for 33 days, $1.37 J^. Example 4. What is the interest on $3,469.32 for 25 days, at 6 «|o per annum ? (From 4th transaction of ApL 30.) $3,469.32 25 1734660 693864 Divisor 6)8673300 14,45,5,50 Interest in hundredths of mills— • equal to $14.45. Although the rate of interest may vary from 6 ^1^, this method can still be used. First find the interest at 6 per cent., as in the preceding examples, and then — Add i of itself for 7 per cent. Add ^ " " 8 per cent. Add 1 " « 9 per cent. Add 1- " " 10 per cent. Subtract I •' " 5 per cent. Subtract | " « 4 per cent. Thus— Divide by 6)$14.45 Interest at 6 o|o— (Example 4.) 2.41 " at 1 o|o 16.86 " at 7 «|o Note. — This luelliod, ut' multiplying by the days and dividing by 6, although generally used, is not exactly correct ; it gives -^ part more than the exact interest, because the rule supposes a year to be 360 days. 208 MERCANTILE CALCULATIONS. The error is corrected by deducting ^ (about U cents on each dollar of interest) of the interest so found, from itself Thus, in Example 2— The interest is Which divide by 73 $4.68 I 6 4.62 exact interest. Note 2.— The divisor "6000," or "6," is used in calculating interest for days at 6 per cent., on account of the facility il gives in dividing by so simple a number ; but it does not follow that 7 is the divisor for in- terest at 7 per cent., nor 5 for 5 per cent. The divisor 6000 is found thus : When we compute interest for one year at 6 per cent., vire always multiply by 6 and divide by 100 ; there- fore, dividing by 360 times 100 (36000) will give the interest for one day ; and in order to save multiplying by 6, we divide by J of 36000, which is 6000— multiplying by 6, and dividing by 36000, produces the same result as dividing by 6000. If wo divide any sum by 6000, we obtain the interest on it for one day at the rate of 6 per cent, per annum, and that interest multiplied by any number of days, will be the interest for that number of days ; but to avoid a loss in fractions, we multiply first and divide after. COMMISSION. Commission is a sum charged by a person for doing business for another — for buying or selling goods, collecting or paying money, &c., &c. Commission is always calculated by the 100, and has no reference whatever to time. 5 per cent, signifies $5 for every 100, or 5 cents on every 100 cents, or 5 cents for every dollar. The calculation is the same that is required to find the amount of any number of articles at 2J or 5 cents each. Example 1. What is the commission on $2,805, at 2 J per cent. ? (Or, what will 2,805 books amount to, at 2 J CtS. each ?) (prom tranB.ction of Feb. 20.) Rule. Multiply the sum by the rate per cent., and divide the product by 100 — that is, if the sum be dollars, cut off two right-hand figures; if the sum be dollars and cents, cut off four. $2805 5610 1402J $70.12 ^ Commission on $2,805, at 2J MERCANTILE CALCULATIONS. Example 2. What is the commission on $4,314.27, at 5 per cent. ? $4314.27 5 209 (From transaction of March 14.) 215,73,35 Commission, $215.73. INSURANCE. f J'^T'^r^ '* ^ r "™ "^^^T/ ^'''" ^a^tying the safety of property fron. the dangers of sea or of fire. In case the property insured is lost, the msurers pay the value that it was insured for, to the holder of the A policy of insurance is a certificate or agreement which one receives trom an insurance company, when he gets property insured. Insurance is calculated by the 100, in the same manner as commission. Example 1, 3 ^cent%^^^ insurance on (or the premium for insuring) $2,805, at $2,805 3 (From tftuisaction of Fdb. 90.) ^^•1^ Premium of insurance, $84.15 Charge for the policy, 1.00 85.15 It is customary, in insuring shipments, to insure for 10 per cent, more than the cost of the goods at the place where they are shipped fi. i T ^'^i^'^ ''^^ ^''^''^'^* ^''^ g^^^^ ^y insurance companies to those who have frequently to get shipments insured. An open policy is a policy larger than the common, on which entries of property insured are made from day to day A note is given to the insuraSace company tor a supposed amount of premiums, and when the note becomes due, the amount of premiums is ascertained and deducted from the amount paid tor the note, and the balance returned to the holder of the policy EXCHANGE. Exchange treats of the values of different moneys, and of chanring sums of one kmd of money to another kind without altering their values. m some cases, foreign money should be calculated at its par or in- trinsic value ; m others, at a premium, or at a discount. I he importer of an invoice of goods changes the amount of the in- 210 MERCANTILE CALCULATIONS. voice into his money at the par value, and credits the person from whom he received the goods for the same. But if he buys a draft, or bill of exchange, by which to make a remittance, he may then pay more or less than the par value of the sum for which the bill is drawn : this more or less is the premium or discount, which varies according to the trade between the two places. This premium or discount is called the rate of exchange, TABLE. Nominal ralue. Intrituic Talue. oCl stg. (20 8. or 40 sixpences) equals $4.44,4 $4.84+ 1 shilling « .22,2 24+ 6 pence " .11,1 12 4 8. 6 d. (or 9 sixpences) " 1.00,0 1.09 Example 1. What is the par value, in dollars and cents, of oGl.lOO st^. % (From traiuacUon of Feb. 13.) Rule. Multiply the pounds by 40, to reduce them to sixpences, annex two ciphers, and divide by 9 — the number of sixpences in a dollar; the result will be dollars and cents. ^1100 40 • 9 )44000.00 $4,888.89 — value of .£1,100 stg., at the nominal par value. Note. — The present true or intrinsic value of .£1 stg. is nearly $4.84 ; but the old or former par value ($4.44) is generally used in accounts. The $4.44 was the par value of a pound sterling previous to the adul- teration of the gold coin of the United States (1834), and that nominal value continues in use, the difference being made up under the name of exchange or premium. When exchange on England is said to be at 8 or 9 per cent, premium in New York, it is in reality only about par — the premium being calculated on the $4.44, the former value, instead of the present. Example 2. What is the value of <£20.. 10..6, in dollars and cents, at part Rule. Reduce the sum to sixpences, add two ciphers, and divide by 9. Thus— de20 .. 10 .. 6 40 800 — sixpences in dC20. 20— " in 10 8. 1 — " in 6 a. 9 )821.00 $91.22 211 MERCANTILE CALCULATIONS. Example 3. What is the amount of a bill of exchange drawn for dC500 stg., at %% premium 1 ^^^^ transaction of Feb. 25.) Rule. Calculate the value at par, as in example 1, and then add the premium. .£500 40 9 )20000.00 $2222.22 Value at par. .$2222.22 177.78 Premium. 8 $2400.00 Ans, ni.n.iQ Example 4. I wish to invest exactly $3,650, funds in my hands belonging to a cor- respondent, in a draft on New Orleans ; for what amount should the draft be drawn, supposing the exchange at 3 per cent, discount, to cost that sum 1 Rule. Multiply the sum to be invested by 100, and divide by the number of cents you allow for $1. $3650 100 97) 365000 ($3762.88 Amount of the draft. 112.88 Discount, 3 »|o off. 3,650.00 Cost of the draft. Example 5. The party that sold the above draft on New Orleans for $3,762.88, at 3 per cent, discount, made merely this calculation : — $3762.88 3 per cent, discount. Dis. on the draft $112.88. 112,88,64 discount. Example 6. I wish to invest exactly $5,000 in a bill of exchange on Liverpool ; for what amount will the bill be drawn, to cost that sum — exchange at "lo premium? Rule. Multiply the sum to be invested by 100, and divide by 100 with the premium, annexing two ciphers to obtain cents ; or, divide by the amount which you give for $1. 100 $5000 9 100 109 ) 500000 ($4,587.15 ^jw. in dollars and cents. 212 MERCANTILE ' CALCULATIONS. Now change the $4,587.15 to sterling : Multiply by 9 and divide by 40. $4587.15 9 40 )41284.35 c£ 1032, 11 Pounds and hundredtns. 20 «. 2,20 Shillings and hundredths. 12 d . 2,40 Pence and hundredths. Example 7. Imported invoice of goods from Havre, amounting to 12,750 francs; for what amount shall I credit the shipper in dollars and cents ? Rule. Multiply the francs by the par value of a franc — 18} cents. Fr. 12,750 18f 102000 Fr. 12,750 12750 3 ^1032 ..2. .2. Ant. 2295.00 76.50 $2,371.50 Ans. 5 )38250 76.50 Example 8. Bought a bill of exchange on Havre for the amount of the above in- TOice (12,750 francs), exchange at fr. 5.30 ; what shall I pay for the bill, in dollars and cents t r j * Rule. Divide the amount of the bill by the number of francs and hundredths allowed for $1, annexing ciphers to obtain cents. 5.30 ) 12,750.00,00 ( $2,405.66 Am, Note.— It will be seen, by comparing this with the precedinir ques- tion, that when the exchange on France is at fr. 5.30, it is at a premium • 12,750 francs, at fr. 5.30, make $2,405 66 12,750 " atpar(18f) " 2,371 50 Loss by exchange 34~T6 Example 9. Bought a bill of exchange on Paris, drawn for 14,062.73 francs— ex change at fr. 5.32 per dollar ; what will it cost ? (Pro« tnniMtion of April 3a) Rule Dmde the amount of the bill by the amount of French money allowed for $1, which, in this question, is SJ^J^r fr. 5.32 ) 14,062.73.00 ( $2,643.58 Am. .. MERCANTILE CALCULATIONS. * 213 i Example 10. I wish to invest $4,987.50 in a bill of exchange on Havana— exchanffe at H per cent, discount ; what amount will the bill be drawn for, allow- ing me ^ per cent, commission for buying the bill ? (From transaction of April 30.) INSTRUCTION. Divide the amount to be invested by the number of cents allowed for $1 (98J cts. are allowed for a dollar). If the exchange be 1^ 1^, discount, for every 98^ cents we get a dollar in the bill. ±5ut as we charge i per ct. commission, we add that to the 98^, which makes the divisor 98|. ^ .98.75 ) 4,987.50,00,00 ( $5,050.63 The bill will be drawn for $5,050 63— which, At 1^ per cent, discount 75 75 Wllcost....... 4,974 88 Add our commission, at -J. o|^ 12 62 Making the sum we wished to invest 4,987 50 EQUATION OF PAYMENTS, Equation of payments, or averaging, is a calculation to ascertain at what date several sums, due at different dates, maybe paid in one payment, so that neither payer nor receiver may gain or lose in time or interest An equation of payments is proved by a calculation of interest; for the interest on the sums due before the average date, should equal the interest on the sums due after. » u u equai cne «f L^P^J^'lT'l^ examples, it is believed, embrace all the different cases of averaging— beginning with the simplest. Example 1. Sold merchandise to Mr. Austin as follows ; when is the amount due I xyr /? 1.-11 /. -^^*- May 21. May6,billof $50 00 " » " 75 00 " 15 ' 80 00 " 27 « 120 00 " 30 " 150 00 • .A"^"^^ \ ^a ^""^ ^T^ average date of the preceding hiWa -^ Multiply ea^ sum by the number of days from its date to tU date If the 1st •wn^^nd^ivide the amount of the products by the amount of the sums. $50 X = 75 X 3 = 225 80 X 9 = 720 120 X 21 = 2520 150 X 24 = 3600 475 ^ )7065(15 days after May 6. 214 MERCANTILE CALCULATIONS. If these sales to Mr. Austin were at 6 or 4 months* credit, the 4 months* credit on the total would begin at May 21. Example 2. Sold merchandise to Mr. Harris as follows ; when is the total due f Calculation. May 10, bill of $40 00 x = "15 " 65 38 X 5 = 325 " 27 " 90 50 X 17 =1,530 " 30 " 120 40 X 20 = 2,400 June 6 " 50 20 X 26 = 1,300 " 20 " 110 90 X 40 ==4,400 " 25 " 148 00 X 45 =6,660 $ 625 38 625 ) 16,615 ( 26 ds. after May 10. The total falls due June 6, that being 26 days after May 10. But if there had been a credit of ^ or & months on these hills of goods, then the credit would begin on June 6, and the amount be due 4 or 6 months after that date. Example 3. Sold merchandise to Mr. Sims on the following dates and credits; when will the amount be due ? Calculation. July 1, bill at 3 months, $400 x 94 = 37,600 " 5 " 4 " 500 X 128 = 64,000 " 10 " 4 " 500 X 133 = 66,500 " 20 " 6 " 1500 X 203 =304,500 Aug. 10 " 3 " 200 X 133 = 26,600 " 20 " 60 days, 100 x 113 = 11,300 Sept. 15 " 90 " 250 x 168 = 42,000 3450 -^ 552,500 ( 160 ds. after == == July 1. This case differs materially from Examples 1 and 2, because the sales are on different terms — one being at 4 months, another at 3 months, &c. Rule. Multiply each sum by the number of days that it will be due, counting from July 1 (the date of the first sum), and divide by the amount of the original sums ; the quotient will be the number of days after July 1, that the amount will be due. The multiplier (128) in the above calculation is obtained thus : — From July 1 to the 5th call 5 days. 4 months call 120 " Grace call 3 " 128 days from July 1, Utat the $500 has to run before due. < MERCANTILE CALCULATIONS. 215 Example 4. Calculation of averaging the account-sales rendered to Mr. Harris, March 30, copied from page 189 : — Terms. Calculation. March 23 cash, $3,000 x = " 26 60 days, 2,400 X 66 = 158.400 " 27 60 days, 500 X 67 = 33.500 " 27 cash, 700 X 4 = 2.800 " 28 3 mos., 1,250 X 98 = 122.500 7,850 ~" Less chai-ges 235 Divide by net proceeds . 7,615 -^ ) 317.200 (41 days af- ter March 23 — equal to May 3. Rule. Multiply each sum by the number of days that it wants of be- mg due, countmg from the first date (March 23), and divide by the net proceeds ; the quotient will be the number of days that the proceeds will fall due after the date averaged from— March 23. Example 5. Calculation of averaging the account-sales rendered to Mr. De Nones -copied on page 188 : — Tebms. Calculation. March 3 cash, $ 456 X = " 4 60 days, 175 x 64 = 11.200 " 4 cash, 300 X 1 = .300 " 9 90 days, 150 x 99 = 14.850 " 10 cash, 1,233 X 7 = 8.631 " 10 4 month s, 2,000 xl30 =260.000 4,314 ^ Less charges 783 Divide by net proceeds . 3,531 -^ ) 294.931 ( 84 days af- ter March 3 — equal to May 25. ,i.f^^^' ^"^'^^P^y ^ac^ 8^™ by the number of days from the first date (March 3) to the date when it will be due, and divide by the net oro- ceeds; the quotient will be the number of days after the first date (March 3) that the net proceeds will be due. Note.— Dividing by the net proceeds, as above, extends the time in proportion to the charges which we consider due March 3— the date we average from. But supposing the charges due much before or after that date, we should then multiply them by the number before or after, and add the product to, or deduct it from, the dividend to be divided by the net proceeds. If the charges were due before the date we average from (March 3), the said dividend should be increased ; if after, de- creased. If we divide by the total sales, we must put another item among the Charges, viz. : interest on the amount of the charges from the date they 216 MERCANTILE CALCULATIONS. average due up to the time the total sales average due ; which method is not truly averaging the account, but averaging a part of it and char- ging interest on the rest. Example 6. When is the balance of the following account due t Dr. John Sims. Cr. 1850. June To amount due us this date #700 700 00 00 1850. May By amount due him this date By Balance due Aug. 17 #500 20Q 700 00 00 00 Rule. {Always calculate from the date of the larger side, calling that the debt and the other side the payment on account of it.) Multiply the sum of the smaller side by the number of days that intervene between its date and the date of the larger side, and divide by the bala^nce of the account ; the result will be the number of days before or cfler the date of the larger side, that the balance will be due. 31 days from May 1 to June 1. 500 from credit side. Balance. .200) 15,500(77 days after June 1 ; equal to Aug. 17. For the reason that the $500 was paid 31 days before the debt was due (June 1), the balance (200) does not become due until 77 days after June 1. Or thus : If one pays $500, 31 days before it is due, how long ought that to extend his credit on $200 ? Ans, JJ^ of 31 days, which is 77 days. Example 7. When is the balance of the following account due f Dr. Cr. 1850. Jan. Feb. Mar. Apr. 15 20 30 20 To Merchandise, at 6 mos. To " ate « To " ate " To " ate " Amount due Sept. 2 f500 300 400 300 1500 00 00 00 00 00 1850. Mar. Apr. June 10 30 1 By Cash By Cash By Note due Aug. 1 Amount due June 5 Balance due Feb.VI \ 51 #200 300 500 1000 500 1500 00 00 00 00 00 00 Average each side of the account separately (as shown in example 2), to find when the total of each is due; the account will then be in situ ation of example 6. MERCANTILE CALCULATIONS. 217 Rule. Multiply the amount of the smaller side by the number of days that intervene between the day on which it is due and the day on which the larger side is due, and divide the product by the balance of the ac- count ; the quotient will be the number of days that the balance will be due after or before the date of the larger side. 89 days from June 5 to Sept. 2. 1,000 amount of credit side. Balance . . 500 ) 89,000 ( 178 days after Sept. 2 ; equal to Feb. 27. The amount of the debtor side is due Sept. 2 ; the $1,000 on the credit side was paid on account of the $1,500, 89 days before it was due; therefore the balance of $500 will fall diie 179 days after Sept. 2. Or] if $1,000 is paid 89 days before the debt was due, how long ought that to extend the credit on the $500 still owing ? ^ns. Lo^o (or LO) of 89 days— equal to 178 days. Example 8. When is the balance of the following account due ? Dr. Paul Harris. Cr. 1850. Jan. Mar. 8 20 30 To Mdse. due March 12 . To Cash #325 2000 4994 7319 00 00 87 87 1850. Jan. Mar. « 22 18 21 30 By Note due March 12 . Bv Cash #325 2000 1187 3807 7319 00 00 50 37 87 Apr. Ana. To Balance due Apl 22, 1850 By Merchandise By net proceeds due May 3 Average, separately, both sides of the account, in manner of Exam- ple 5. The debtor side ($2,325) will be due March 19 ; the credit side ($7,319) will be due April 11. Thus, then, we owe Mr. Harris $7,319, due April 11 ; on which we have paid him $2,325, due March 19 — ^leav ing a balance in his favor of $4,994. Now, as we paid him $2,325 23 days before what we owed him was due, it follows that our credit on the balance should be extended in proportion as the amount paid is to the balance owed; that is — ffj| of 23 days after April 11= Apl. 22. PROFITS AND LOSSES. Example 1. Bought an article for $5, and sold it for $6 ; at what rate per cent, was the gain ? Rule. Multiply the gain or loss by 100, and divide the product by the cost. 28 i ^^® MERCANTILE CALCULATIONS. Gain $i 100 • ^°«* o) 100(20 per cent. Am. 10 Example 2. Bought 50 chests tea for $4,725, and sold the same for $4,866 75 • at what rate per cent, was the gain ? ^ «*,ood./o , at Sold for $4,866.75 Cost 4,725.00 ^ain 141.75 100 4,725.00)14175.00(3 per cent. gain. Ant, Example 3. rnff^i%\ ^^ ™^^^]^^°^i«« *e last four months amount to $24,619: the cost $21,056 ; what per cent, is the profit ? ip«»iox», we Sales $24,619 Cost 21,056 C^ain 3,563 100 21,056)3563.00(16.92 Ant, Sixteen and ^^^ per cent. Example 4. Sales of merchandise this year amount to $55,660 : suoDOsincr tha profits average 12 per cent., how much is the gain ? '"PP^«*°^ ^^^ h^^lT ^1!"^^'^ *^^ ^'^''''''^ ""^ ?'^' ^y 100' ^"d ^^^o the product I- 2^"!."^ ^^^.""^^^ per cent, added; the quotient will be the cost Which deducted from the sales will give the gain. $55,660 100 $55,660.00 sales. 112)55,66000 ( 49,696.43 cost. 5,963.57 gain. TBI BND. OFICINA PARA LA PRACTICA DE LA TENEDURIA DE LIBROS, ESCRITURA Y ARITMETICA MERCANTIL, Broadway, New York. PoR D" C. C. MARSH, Contador, Aotor de "La Ciencia de Partida Doble Simplificada," y "El Arte de Fartida Simple Mejorado.'* CURSO DE INSTRUCCION. Se asegura al publico que el sistema que el S" Marsh observa en la ense- fianza de este importante ramo de educacion, es realmente un curso de Uevar libros practicamente, mas beia que discursos sobre la teoria de esta ciencia. Para que se pueda rendir esta ciencia (itil en su practica se requiere una ensenanza mas estricta y un conocimiento mas profundo del que se puede par- »icipar con discursos 6 per el metodo de ensefianza correlativo en las escuelas, I saber, escribir 6 copiar en dos 6 tres libros. El S" Marsh ensena de una manera solida y mui ejercitada todos aquellos puntos que tocan a un juego de libros pertenecientes a una sociedad mercantil ; es decir, Principiarlos, Llevarlos, y CerrarJos 6 Concluirlos, hacer Balances de Prueba, Balances Generales, Cuentas Corrientes, Cuentas de Ventas, y Calcu- los de Intereses, Descuentos, Ganancias, Perdidas, Promedio de Pagos, Cam- 0108, Monedas, &<=. je modo que el discipulo llega a familiaxizarse con' todos los Libros que constituyen un juego completo ; y si es persona de buenas luces naturales, en el curso de un mes podra hacerse un tenedor de libros competente y recibira un certificado al efecto. RMINOS. A ningun discipulo se le ensefiara en clase pues todos recibiran instruccion privada. Ciencia de Partida Doble : un curso completo de practica |P»gadero8 adeiantados $25 00 2 00— $27 00 e instruccion, incluso la ensefianza de calculos mercantiles Por libros, papel, plumas, &«• para el curso Arte de Partida Simple: un curso completo de instruccion Por libros, papel, plumas, &<=• para el curso Arte de Escribir: un curso de lecciones bien calculado para darle al discipulo una letra mercantil y arrogante . Por papel, plumas, &c- para el curso . • $10 00 2 00— $12 00 $10 00 50— $10 50 [tj/* No course of Instruction, it is confidently believed by all who have pur sued it, has ever been devised, so well calculated to give a PRACTICAL KNOWLEDGE OF BOOK-KEEPING, as the one now offered to the public, and which the advertiser has taught for 15 years in the city of New Yorkj with the greatest success and approbation. COUNTING-ROOMS FOR THE PRACTICE OF BOOK-KEEPING, MERCANTILK WRITING AND C{)MMt:RCIAL ARITHMETIC. Broadi^ay, New York. By C. C. marsh, Accountant, Author of " Thk Sciksck of Doublk-Entrt Book-Keepiko Simplified." and " Thk Art OF Single-Entry Book-Keepino Improved," etc. COURSE OF INSTRUCTION. The public is respectfully informed and assured, that the plan pursued by Mr. Marsh, in teaching this important branch, is truly a course of practice W KEEPING BOOKS, rather than a course of lectures on the theory. To be practically useful, a more exact and particular knowledge of Book- Keeping is required than can possibly be imparted by mere lectures, or by the 3ommon method of teaching it in schools — viz. writmg out or copying in two or three books. In this establishment the pupil is faithfully instructed and well-exercised in all the various operations connected with a set of Partnership Books ; in Opening, Conducting, and Closing the same ; in making out Trial-balances, Balance-sheets, Accounts-current, Account-sales ; and in calculating Interest, Discount, Profits, Losses, Equation of Payments, Exchanges, Currencies, &c. He becomes familiar, from actual use, with all the books constituting a set ; and a person of good capacity, will by this course become a competent book- keeper in about one month, and will receive a certificate to that effect. ERMS. No person is taught in a class — every pupil has a desk to himself, and re- ceives private or separate attention and instruction. Double-Entry Book-Keeping, for a complete course of Practice and Instruction, including Mer- cantile Calculations, &c., &c., time not limited. . . Books and Stationeiy for the course Single-Entry Book-Keeping, complete courae of Instruction, time not limited Books and Stationery for the coui-se Mercantile Writing, for a course of lessons well calculated to make a good penman, time not limited Stationery for the course Payable in Advance. $25 00 2 00-1-827 00 $10 00 2 00— $12 00 $10 00 50— $10 50 4 II jt. ^ tl .11 rr. Jtl i 11 ^^ T_ ni n. COLUMBIA UNIVERSITY LIBRARIES This book is due on the date indicated below, or at the expiration of a definite period after the date of borrowing, as provided by the library rules or by special arrangement with the Librarian in charge. 1 DATE BORROWED DATE DUE i DATE BORROWED DATE DUE AUG 4 IS'' '^k t ' ^ i 1 C28(842)M50 y fa Cr . 4i- i^617 Marsh, C. C. B^arsh's course of book kee ping .vC^ 'p4'^^ /fsJ'j'i /115H 0OlU\r NEH MAR 161991 , COLUMBIA UNIVERSITY 0032054874 MAK 5- 1946 • ff Jl> ^ iv: w *t»IIHPr END OF TITLE