56 FARM ACCOUNTING 



firms or corporations. They may be considered as resources 

 or liabilities, depending an the nature of the balance of 

 the account. 



A real account is one that records transactions relu 

 to resources and liabilities other than personal accounts. 



The other classes of accounts have been discussed in 

 connection with the financial statements. The ledger ac- 

 counts have been presented in accordance with Classifica- 

 tion 2, above. 



ILLUSTRATIVE PROBLEMS 



1. Using ordinary ledger paper, create the necessary nominal 

 and other accounts and express therein the debits and rmlits 

 necessary to interpret the following transactions in the ledger 

 of Mr. Woods. (Safin -lent space is to be allowed for each ac- 

 count to permit of its use in problem 3, below.) 



Mar. 1, 1916, Geo. Woods starts keeping his accounts in a sys- 

 tematic way, and accordingly values his possessions as follows: 

 Cash $600, owing by Thos. Carey $100, cattle $800, poult ry 

 swine $900, horses $1200, equipment $600, land $8000, buildings 

 $5500. He owes $8000 on a mortgage note. 



Apr. 1, Paid cash for labor $25. 



May 1, Paid $240 for six months' interest on mortgage note. 



May 6, Received $100 from Thos. Carey in settlement of his 

 account. 



May 7, Sold eggs for $5 cash. 



May 8, Paid cash for labor $25. 



June 1, Paid cash for labor $25. 



June 8, Paid for miscellaneous items $15. 



June 10, Sold some fruit for cash $10. 



July 1, Sold some hay for $180 cash. 



July 3, Paid cash for labor $45. 



July 6, Paid $85 for some new equipment. 



July 21, Paid for miscellaneous items $25. 



Aug. 4, Paid cash for labor $60. 



Aug. 28, Received $500 cash for oats. 



Sept. 1, Paid cash for labor $50. 



