CHAPTER V 

 BOOKS OF ORIGINAL ENTRY 



The Ledger as an Only Book of Entry. The ledger has 

 been used in the preceding chapters as the basis of all ac- 

 counting information. The essentials of all business trans- 

 actions were recorded in it, and all subsequent information 

 concerning the transactions and their aggregate effect on 

 the progress and condition of the business was derived from 

 it. The trial balance, Statement of Resources and Liabili- 

 ties and Loss arid Gain Statement were prepared from the 

 ledger. In fact, as previously suggested, the ledger is the 

 book into which all essential financial information of a 

 business is placed, and out of which data are collected, 

 sorted and correlated as a basis for conclusions and con- 

 structive criticisms of the business. This principle is fol- 

 lowed out in all good commercial accounting, and applies 

 with equal significance to farm accounting. 



The ledger can be used as the only book of record for 

 a business. In commercial bookkeeping it is not the prac- 

 tice to use it as the only book of record. In farm account- 

 ing precedent does not influence its use in that way, but 

 other factors render it more desirable to use other books 

 in connection with it. 



Five Reasons for Using Books of Original Entry. In 

 commercial bookkeeping there are five reasons for using 

 other books, known as books of original entry, in which 

 debits and credits are expressed before transferring them 

 to the ledger accounts. It should be remembered, however, 

 that these books of original entry do not alter the main 



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