~~ Tee ae 
eS Se eee eo ee ee 
LIVE-STOCK SHIPPING ASSOCIATIONS. 17 
holders, who have a prior claim. The farm business in this case 
might be thrown into bankruptcy by the creditors. On the other 
hand, if the property was valued at $60,000, the other items remain- 
ing the same, there would be $40,000 left after paying off the note 
holders. In this case, each dollar of the owner’s investment would 
be worth 1334 cents, and the financial condition of the farm would 
be considered very favorable. 
A similar procedure is followed in determining whether or not 
any other kind of business concern is worth 100 cents on the dollar. 
An illustrative statement representing the affairs of an imaginary 
shipping association is presented below. 
STATEMENT OF RESOURCES AND LIASILITIES OF THE BROOKRIDGE COOPERATIVE 
SHIPPING ASSOCIATION, NOVEMBER 1, 1921. 
Resources. 
Rey eee eee 8 nadia beg dete Sew $576. 02 
Wort and once equipment ~ >)" 4° > St esos “o.oo 5b AS: 1, 000. 00 
$1, 576. 02 
liabilities. 
0S ED cha I a tir dO ree $300. 00 
UPGeratipris Gtieni) 152. OFFS IS tt th) OST Uap vit ee 4 55. 00 : 
susurance: Gim@oee 2 3: ogo Fi sbreesl Gis ey: 799. 51 
LES TREE E 8 be OSD FT CO SE yn a eee eee pee ERO RG A ne Ica Be Sau 
1, 158. 02 
Net worth. 
ayrigstte Ss beige tees age 6 eee ds RE = EN Dat 400. 00 
SHERI. Une aged = DRONES jt 5 Ea 18. 00 
—— 418.00 1,576.02 
Tt will be noted that the resources consist of cash and equipment 
amounting to $1,576.02; the habilities amount to $1,158.02, consist- 
ing of outstanding notes, dues owed to a State association, the re- 
serve for insurance and the undivided balance. The resources 
exceed the liabilities by $418, which amount represents the net worth 
of the association. As only $400 was put into the business originally, 
the difference of $18 represents surplus profits left in the business. 
It will also be noted from this statement that the investment in 
the business came from stockholders, rather than from an individual 
owner, as in the case of the farm business. An association which is 
not incorporated is regarded as a partnership, in which case all of 
the members would be joint owners. 
Each of the subdivisions in the statement shown above represents 
a separate account in the cash journal; in fact, it is from the accounts 
in this book that the information for such statements is obtained. 
The accounts which a particular association needs depend upon 
the character of the business, if any, which it combines with live- 
stock shipping. Ordinarily all shipping associations need the follow- 
ing accounts: 
1. Bank. 
2. Live stock. 
3. Manager’s commission. 
4. Insurance find. 
Other accounts which are frequently needed are: 
9. Federation dues (State or district | 11. Indebtedness (or notes payable). 
federation). 12. Merchandise, 
10. Yard and office equipment. 
33703 °—23—_3 
Local car expense. 
. Undivided balance. 
Loss and gain. 
. Net worth. 
CO 1 D> ON 
