48 FARM ACCOUNTING 



processes of addition and subtraction. One not acquainted 

 with bookkeeping methods might think it necessary to per- 

 form this brief calculation on a separate piece of paper, 

 but bookkeeping principles and abbreviations provide for 

 a more systematic and permanent method. 



The expense for rent is removed from the debit side 

 of Rent account and placed on the debit side of Loss and 

 Gain account, where it can be used in connection with other 

 expenses and other incomes transferred to the latter ac- 

 count for the purpose of finding the net result. After 

 the net result of all nominal accounts is found in Lorn 

 and Gain account it is removed from that account and 

 placed in Capital account. 



Transfer or Closing Entries. The method of removing 

 or transferring these balances from one account to another 

 involves bookkeeping abbreviations that require further 

 study and analysis. It involves rinsing entries. Cl> 

 entries are those made to transfer expenses and incomes 

 fnnn tin ir several accounts into tin <iij>it<iJ (ian,>t of the 

 proprietor. Consider first the transfer of the slnn rent 

 from the debit side of Rent account, to the debit side of 

 Loss and Gain account, as in Illustration 10. Before the 

 transfer, the Loss and Gain account did not contain any 

 entries, while the Rent account appeared as follows : 



Rent 



1917 



Feb. 21 Cash $400 



In order to transfer this amount from Rent account to 

 the Loss and Gain account, one might choose the way most 

 natural to the person not accustomed to bookkeeping meth- 

 ods. This natural but wrong method would consist in 

 drawing a line through the entry under Rent account and 



