170 FARM ACCOUNTING 



household furnishings are valued at $700. All tile purchased on 

 Feb. 27 are still on hand ; also the lumber bought on Mar. 20. 



(a) Make all the entries for the transactions given above. 



(b) Post all entries to the proper ledger accounts, ruling off 

 cash journal. 



Take a trial balance immediately after posting the last 

 transaction, before considering inventories. 



(d) Considering inventories, prepare a Loss and Gain account 

 in the ledger, and rule off the necessary accounts, bringing down 

 balances or inventories whenever the nature of the account re- 

 quires it. 



(e) Take a trial balance after closing which may be used also 

 as a list of the Resources and Liabilities as of March 31, 1917. 



RKVIEW QUESTIONS 



1. Describe the method of recording the value of services of 



a hired man employed regularly, but drawing cash as 

 wanted at irregular intervals. 



2. What is the general principle governing debits and credits 



to Notes Receivable account? 



3. What three methods of parting with a note receivable cause 



credit entries in the account? 



4. Why must Notes Receivable account always have a debit bal- 



ance, if any? 



5. Is interest on notes included in the note account? 



6. State two ways in which it can be determined whether a 



promissory note parted with is credited to Notes Re- 

 ceivable or Notes Payable account. 



7. Why must Notes Payable account always have a credit bal- 



ance if any? 



8. What negotiable instruments are considered as cash rather 



than notes receivable or payable? How are mortgages 

 treated in accounts? 



9. What principles govern the debits to Land account when 



opening a set of books? When purchasing land? When 

 inheriting land? 



