SPECIAL ACCOUNTS AND ENTRIES 137 



Mar. 1, 1916. The debit of $400 indicates either a credit 

 to Capital account at time of opening the books ; or a credit 

 to Swine account on the last day of the preceding year, if 

 the account books were kept at that time. 



Nov. 5, 1916. This credit of $200 indicates that swine 

 were sold for $200 cash, the latter account being debited. 



Jan. 30, 1917. This credit of $300 resulted in a debit 

 to Cash for the sale of swine. 



Feb. 28, 1917. The $300 credit for the inventory was 

 made after taking the trial balance at the close of the 

 year, but before preparing the Loss and Gain Statement 

 or Statement of Resources and Liabilities. It was made 

 as part of the process of closing the ledger. The debit 

 to offset the credit is found below the double lines of the 

 same account. It is dated Mar. 1, 1917. It is considered 

 as being made the first instant of the new year and the 

 credit as being made the last instant of the old year. The 

 date does not have any material effect except that it is 

 better to have the entries above the double lines bear a 

 date within the limits of the old year; and those below 

 the double lines bear a date within the limits of the new 

 year. When books of original entry are used this is one 

 of that class of entries that do not have to appear in a book 

 of original entry first. The reason is that it is a debit and 

 a credit to the same account. 



The $400 debit in Illustration 25, under Feb. 28, 1917, 

 is made in order to transfer the net gain to the Loss and 

 Gain account. This is the last entry made before ruling 

 off the account and bringing down the inventory. The loss 

 or gain is found by the same arithmetical process that is 

 used when the inventory is not brought into consideration. 

 In this case (Illustration 25) the sum of the two sales plus 

 the inventory at the close of the period is $800. By sub- 

 tracting the $400 debit entry of Mar. 1 , 1916, it is found 

 that the result of dealing in swine is $400. This gain is. 



