44 FARM ACCOUNTING 



are assembled in one place. From this place the net result 

 of all increases and decreases in capital is determined, and 

 such result is shown in a single amount in the Proprietor's 

 Capital account. 



Loss and Gain Account. These several accounts, taking 

 the place of the one Proprietor's Capital account, enable us 

 to find more easily the expenses and incomes of various 

 sorts, but they do not as yet enable us to determine what 

 the net increase or decrease in capital is, or what the capi- 

 tal is at the present time. In order to find these, it is nec- 

 essary to perform another step in the correlation of the 

 accounts just presented. It is necessary to bring the re- 

 sults of the accounts of expense and in-oiiie into the Capi- 

 tal account. This is accomplished through the medium of 

 a Loss and Gain account. After this prooMB is performed 

 the accounts should appear ns in Illustration 10. 



ILLUSTRATION 10 



NOMINAL ACCOUNTS CLOSED INTO CAPITAL THROUGH Loss AND 

 GAIN ACCOUNT 



Mr. Arnold's Capital 



1917 



Feb.) 28 Balance down. . $5,000 



$5,000 



1916 



Mar. 1 Capital invested $4,000 



1917 



Feb. 28 From loss and 



gain 1,000 



$5,000 



1917 



Mar. 1 Balance, net 



capital $5,000 



