A SYSTEM OF ACCOUNTING FOE COTTON GINNERIES. 



L. TRADING INCOME. 

 Cottonseed Sales (LI). 



31 



Debit: 



Credit: 



1. With the sale value of any cotton- 



1. 



With the sale value of all cottonseed 



seed which has been recorded as 





sold . ( Debit Accounts receivable 



sold, but which has been subse- 





or Cash accounts.) 



quently returned. 







2. With the credit balance at the end 







of the fiscal period. (Credit Loss 







and gain.) 







The sale of all cottonseed must be credited to this account. 



Cotton Sales (L2). 



Debit: 



1. With the sale value of any cotton 



which has been recorded as sold 

 but which has been subsequently 

 returned. 



2. With the credit balance at the end of 



the fiscal period. (Credit Loss 

 and gain.) 



Credit: 

 1. With the sale value of all cotton sold. 

 (Debit Accounts receivable oi 

 Cash account.) 



The sale of all ginned cotton must be credited to this account in order that the true 

 relation existing between the trading and ginning operation may be determined. 



Bagging and Ties Sales (L3). 



Debit: 



1. With the sale value of any goods 



which have been recorded as sold, 

 but which have been subsequently 

 returned. 



2. With the credit balance at the end of 



the fiscal period. (Credit Loss 

 and gain.) 



Credit: 



1. With the value of bagging and ties 



used in ginning operations and 

 charged to customers as a part of 

 the charge made for ginning. 



2. With the sale value of bagging and 



ties used in ginning purchased 

 seed cotton. 



3. With the sale value of any bagging 



and ties sold direct and not con- 

 sumed in the ginning process. 



All bagging and ties used in any of the ginning operations, or sold to outsiders must 

 be accounted for by a credit to this account. In no other way can a proper relation 

 between the ginning and trading operations be maintained. It is absolutely neces- 

 sary to establish such a relation, if the unit cost of ginning is to be ascertained, and 

 the adequacy of the charge made for ginning to be determined. 



M. MISCELLANEOUS INCOME. 

 Cash Discount (Ml). 



Debit: 

 With the credit balance at the close of 

 the fiscal year. (Credit Loss and 

 and gain.) 



Credit: 

 With any income arising from cash dis- 

 counts deducted from invoices paid. 



