Farm Accounts. 127 



Ledjjer. A very little practice will enable the farmer to prepare 

 the entries correctly for the Ledger — I mean to fill up the 2nd 

 column properly. 



Besides this book we must have the Cash-hook, in which all 

 actual cash receipts or payments find a place either on the Dr. or 

 Cr. side, according to their nature : and here, before proceeding 

 farther, I will endeavour to explain the meaning of the two terms 

 Dr. and Cr. sides of an account, the not understanding which 

 causes, I believe, more confusion and perplexity than any other 

 })art of accounts. 



In every account there are supposed to be two sides : one for 

 all that comes in, the other for all that goes out. It may be 

 au account of money or an account of goods, as " wheat " or 

 " sheep ;" but the account is said to be Dr. " to" all that comes 

 in, Cr. "by" all that goes out, be it money or be it goods. 

 In like manner a separate account may be kept for work done. 

 Thus the labour account is charged as Dr. to all the money paid 

 for wages, which represents the value received or brought in in 

 the form of work ; and if the farmer does work for any purpose 

 unconnected with his farm, as, for instance, haulage of timber on 

 au estate, the labour account should take credit for this as work 

 " gone out " from the farm — that is, the charge against the farm 

 for labour would be diminished by that amount which is pre- 

 sumed to be paid for in some other way. The Dr. side of an 

 account, as you open the book, should always be on the left- 

 liand side, the Cr. on the right ; it saves confusion to have a 

 rule of this sort. 



The account. Cash in the case before us, is indebted to all 

 sums or items that are given to it, and, therefore, whenever a 

 transaction, whatever it may be, involves the immediate receipt 

 of money, it confers a benefit on the account, that is, it increases 

 Cash ; the Cash Account is therefore indebted to some one or 

 something, and consequently the item must appear on its Dr. side. 



When money is paid away the cash is diminished ; the Cash 

 Account, therefore, is Creditor by the transaction, it takes credit 

 for having given up money ; and thus we may at once know to 

 \vhich side an item belongs, according to whether it adds to or 

 takes from the account. 



Let us take a very simple example : I receive 20/. from a 

 butcher for a fat ox, sold to him, say a month ago ; Cash or 

 myself, for Cash represents the farmer, is Debtor to the butcher ; 

 but suppose I pay away 15/. for a week's labour, then the 

 '■'labour" account is indebted, or Debtor, and Cash takes Credit 

 for paying away the 15/., and is Creditor. Let us place these 

 two accounts on the opposite sides of an imaginary Cash Book. 



