32 



THE POPULAR EDUCATOR. 



the Persons on whose account the bills have been accepted, and 

 collect the sums of all those accepted on the same person's 

 account into one amount as before ; and if bills have been 

 accepted on only one person's account, make that person Dr. to 

 Bills Payable. 



The next book to be journalised is the Day-Book. As the 

 form of the entries in the Journal is similar to that of the 

 entries in the Day-Book, there are, in general, no other changes 

 made upon the latter entries in transferring them from the 

 one book to the other, than those which an abridgment or a 

 condensation of entries by means of combination is naturally 

 suggested to the Bookkeeper from their exact similarity. This 

 abridgment or condensation is made in three ways : 1st. 

 When the same account is debited to a number of different 

 accounts at different dates of the same month ; then make that 

 account Dr. to Sundries for the amount of all the sums thus 

 entered, specify the name of each account, and collect all the 

 sums belonging to each account into one amount. 2nd. When 

 a number of different accounts are debited to the same account 

 at various dates of the same month ; then make Sundries Dr. 

 to that Account for the amount of all the sums thus entered, 

 specify the name of each account, and collect all the sums be- 

 longing to each account into one amount, as before. 3rd. When 

 the same two accounts are found in several entries, having the 

 same relation to each other as Dr. and Cr., and at different dates 

 of the same month ; you then make a single entry of the whole, 

 and collect all the sums of the different entries into one amount. 

 In these various cases of abridgment or combination, arrange 

 the dates and the sums which belong to each Specified Account, 

 in the proper columns of the Journal and in the same line with 

 the name of each account, placing the latest date in a line with 

 the first name or word in the combined entry, and the whole 

 amount of all the sums in a line with the name of the general 

 Dr. or general Cr. in the entry. The commencement of each 

 month in the Journal is distinctly shown by writing the name 

 of the month and the year across the page, in a space extending 

 from side to side. The dates are inserted in a vertical column 

 to the left hand of each page ; and parallel to this column is 

 one intended for the folio of the Ledger when the entries of 

 each name and sum are posted into that Book. The numbers 

 denoting the folios should be entered in this column of the 

 Journal when these particulars are entered in the Ledger, but 

 not till then ; the absence of a folio figure in its proper column 

 opposite the name of any account will then indicate that an 

 entry has been omitted ; and the absence of all such figures will 

 indicate that the entries without them have not yet been posted 

 into the Ledger. 



In keeping Books by Double Entry, the various accounts 

 which are opened in the Ledger correspond, of course, exactly to 

 ihe nature of the transactions which occur in the business. In 



general, however, their object is threefold, as formerly stated 

 in our third Lesson, viz. : The Property Accounts, the Personal 

 Accounts, and the Profit and Loss Accounts. In the same 

 Lesson rules were given for finding the Debtor and Creditor, 

 and making the proper entry in every variety of transaction. 

 As a general rule, in opening these accounts in the Ledger, it is 

 both usual and proper first to open those accounts which are 

 called Property Accounts, such as Stock Account, which repre- 

 sents the capital employed in a Merchant's business; and 

 Private Account, which represents the Merchant himself and 

 contains all the moneys abstracted from the business on his 

 own personal account, and which, in the old Italian system a 

 system not remarkable for its simplicity used to be entitled 

 Household Expenses. 



The Property Accounts which follow these are generally Cash 

 Account and Petty Cash Account, the names of which sufficiently 

 indicate their nature, and the transactions which must be 

 ranged under these heads. Then follow the Accounts of Bills 

 Receivable and Bills Payable; and here it maybe useful to 

 observe that, in order to prevent mistakes, these should be put 

 in different folios of the Ledger. Next may follow Goods 

 Accounts of various kinds, sach as Cotton Account, Flannel 

 Account, Cloth Account, or the account of any other article in 

 which the Merchant happens to deal. It is important to remem- 

 ber the order in which these accounts come. 



After the Property Accounts are opened in the Ledger, then 

 follow the Personal Accounts, or the names of those persons 

 with whom a Merchant deals, whether in buying or selling 

 Goods, Lending or Borrowing Money, and acting as Agent or 

 otherwise. Lastly, are opened the Profit and Loss Accounts, or 

 those in which the Loss or Gain by certain transactions are 

 at once rendered manifest from their nature ; such as Interest, 

 (including Discount), Charges, Commission, etc. Besides these, 

 the general Profit and Loss Account itself is also opened, as a 

 receptacle for a proper statement of all the Losses and Gains in 

 business not classified under particular heads, and as a proper 

 account for exhibiting at the end of any given period the actual 

 state of a Merchant's business in respect of his real Gains and 

 Losses on all the other accounts which have been opened in the 

 Ledger. Although this explanation sounds intricate, it will be 

 mastered with a little care. 



In posting the entries from the Journal into the Ledger, it is 

 plain that whatever the Journal says in any entry, the Ledger 

 must say the same thing, sometimes in the same form, some- 

 times in a different form ; but in Double Entry, this same thing 

 must always be said twice, namely, once on the Dr. side of the 

 Debtor's Account, and once on the Cr. side of the Creditor's 

 Account. Let us illustrate this principle by some examples : 

 First, suppose that the following entry occurred in a Merchant's 

 Journal, and in the following form : 



This entry* single in the Journal, must be entered twice in 

 the Ledger, viz., once on the Dr. side of Richard Watson's 

 Account, and once on the Cr. side of Cotton Account ; here, 



the word Dr. clearly points out the Debtor, and the word To 

 points out the Creditor. These entries in the Ledger would be 

 as follows : 



Dr. 



RICHARD WATSON. 



Cr. 



Dr. 



COTTON ACCOUNT. 



Cr. 



