A SYSTEM OF ACCOUNTING FOR COTTON GINNERIES. 33 



Operating Supplies (N5). 



Debit: 



1. With the cost of all supplies used in 

 the current operation of the gin. 



Credit: 

 1. With the debit balance at the close 

 . of the fiscal period. (Debit Loss 

 and gain.) 



Operating supplies include such items as lubricating oils and greases, waste, etc., 

 but do not include any item of repairs, or office supplies. 



Insurance (N6). 



Debit: 



Credit: 



1. At the close of the fiscal period with 



1. With the debit balance at the close 



the insurance premiums expired 



of the fiscal period. (Debit Loss 



during the period. (Credit Pre- 



and gain.) 



paid insurance.) 





O. ADMINISTRATIVE EXPENSE. 

 Office Supplies (01). 



Debit: 

 1. With all purchases of stationery, 

 printing and supplies used in the 

 office. 



Credit: 

 1. With the debit balance at the end 

 of the fiscal period. (Debit Loss 

 and gain.) 



Should there be any considerable quantity of these supplies on hand at the end of 

 the fiscal year, the value should be conservatively estimated and an entry made, 

 charging an asset account captioned "Office supplies, inventory," and crediting this 

 account. The asset should be shown on the balance sheet under accounts paid in 

 advance. 



Telegraph, Telephone, and Postage (02). 



Debit: 

 1. With all payments for these items. 



Credit: 

 1. With the debit balance at the end 

 of the fiscal period. (Debit Loss 

 and gain.) 



Rent (03). 



Debit 



With the actual payments made on 



account of rent. 

 With accrued rent at the close of the 



fiscal period. (Credit Accrued 



rent and taxes.) 



Credit: 



At the beginning of the fiscal period 

 with the accrued rent at the close 

 of the previous fiscal period. 

 (Debit Accrued rent and taxes.) 



With the debit balance at the end 

 of the fiscal period. (Debit Loss 

 and gain.) 



No economic or theoretical rent should in any case be entered into this account. 



