10 



FARM ACCOUNTING 



LIABILITIES 



53. Mortgage note favor Monarch Insurance Co., due Jan. 1, 



1913, with interest at 5% payable July 1 and Jan. 1 

 until paid. Part purchase price of land. Next inter- 

 est payment July 1 $ 7000.00 



54. Note due bank Jan. 15 200.00 



55. James Goodwin, balance due on acct 49.69 



56. A. A. Wells & Co* balance due on acct 178.29 



57. W. Cushman, balance due on acct 5.04 



Total . . , $ 7433.02 



As shown in the model, number the items in the inventory 1 to 57 for convenient refer- 

 ence later on. 



Ledger. The general accounts of the ledger will include Proprietor's Investment, Cash, 

 Merchandise, Real Estate, Chattels, Dairy, Teams, Hogs, Poultry, Orchard, and Labor. 



Other departments as needed will be opened. Give each account one page of ledger 

 space. The general accounts will occupy pages 1 to 20. The order of their entry is given 

 under "Opening the Ledger" on the following page. 



The personal accounts are to be entered in the personal division of the ledger. Be care- 

 ful to make full use of the explanatory space. For example, a long time note should have 

 explanation showing to whom given, the terms of payment, etc., thus making a convenient 

 reference. When personal accounts are opened, any conditions or explanations of the ac- 

 count should be recorded at the beginning of the account. Thus, an account opened with an 

 employee should give a brief memorandum of the terms of his employment, at the top of the 

 ledger account. 



FIRST JOURNAL ENTRY 



The inventory which has been spread on the journal in memorandum form should now 

 be reduced to debit and credit entries. Before considering the titles to be used in detail, 

 observe that the journal -lias two special debit and credit columns, which are footed monthly 

 and posted from the general columns as single items. 



In making the opening journal entry, total the items Nos. 1 to 7 of the inventory and 

 charge Real Estate with their sum. Total items Nos. 8 to 51 and charge Chattels. Charge 

 Cash (in general column) with No. 52. 



Credit Nos. 53 an 54 to Notes Payable. Credit Nos. 55 to 57 to the respective persons 

 owed. Credit E. A. Atkinson, Proprietor, with the difference between the total debits and 

 credits entered. 



Rule and total the opening entry as shown in the model form. 



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