198 FARM ACCOUNTING 



the close of the year. The Loss and Gain account in the 

 ledger must contain as a debit item any net expenses trans 

 ferred from Household account in order to keep the ledger 

 in balance, and to show the expense* of all kinds on tin- 

 premises. In the case at hand he made $^500 as a farmer, 

 but his personal and household net expenses amounted to 

 $800 during the year, leaving him only $700 better off as an 

 individual at the close than at the brginimig of the year. 



It sometimes happens that the household account shows 

 a credit balance after considering inventory, due to the 

 fact that the Household is credited for the value of labor 

 of the proprietor and other members of the family, which 

 credit exceeds the charges to the Mousrhold for farm 

 products, groceries and other living expenses. In such a 

 case, the Farm and Individual Income Statement appears 

 in the form shown in Illustration 39. 



II LUSTRATION 39 



FARM AND INDIVIDUAL INCOME STATEMENT 

 (HOUSEHOLD ACCOUNT SHOWING A GAIN) YEAR ENDED FEB. 28, 1917 



Wm. E. Thompson 



Net Gain as an individual, as per Loss and Gain account $500 . 00 

 Less Household credit balance 200 00 



Net Gain as a farmer $300.00 



The statement of Illustration 39 indicates that Mr. 

 Thompson 's Loss and Gain account showed a gain of $500. 

 On the credit side of the Loss and Gain account there was 

 apparently an item of $200 transferred from Household 

 account. The $500 balance, therefore, was not the true 

 gain of the farm. The household had "donated" $200 

 worth of services, board and other values over the cost of 



