192 FARM ACCOUNTING 



treatment under Rent Distribution in Chapter IX, a simple 

 case is presented here to indicate the effect of share rental 

 on the accounts of the tenant. 



Effect of Share Rental on Accounts. Assume for this 

 purpose that the landlord furnishes land and buildings and 

 one-half of all working resources such as livestock and 

 equipment. Assume also that the tenant pays all oper- 

 ating expenses except insurance, taxes and repairs on land 

 and buildings, and that all products and livestock sold 

 from the farm are divided equally between landlord and 

 tenant. With these conditions, tin 1 Capital account, re- 

 sources and liabilities of the tenant only are shown in the 

 tenant's ledger. All expuiM-s are charged to the appro- 

 priately named accounts as in other cases. No property 

 of the landlord is recorded in the books of the tenant. 



Under the conditions cited in the preceding paragraph 

 assume that the tenant A and landlord B together own 

 $300 worth of swine at the beginning of the year, that 

 there are sold from the farm $1000 worth diirinjr tlic year 

 and that the inventory value of the drove at the close of 

 the year is $200. Such conditions would cause A 'a Swine 

 account to appear as in Illustration 36. 



The Swine account of tenant A in this case records 

 only one-half each of the total value of the beginning in- 

 ventory, the sales and the closing inventory. In IlluM ra- 

 tion 36, for example, A's Swine account is d.-bited with 

 $150 as the beginning inventory. It shows the value of 

 swine belonging to A without attempting to show the 

 value of swine on the farm. Similarly the inventory at 

 the close of the year shows only one-half the total value 

 of all swine on the premises. The sales of $500 recorded 

 on the credit side of the Swine account in question repre- 

 sent only A's share of the total income of $1000 from 

 the sale of swine during the year. As a result of these 

 transactions in swine during the year, A's Swine account 



