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A SYSTEM OF ACCOUNTING FOR COTTON GINNERIES. ma A 
‘ 
H. RESERVES. 
RESERVE FOR DEPRECIATION, BUILDINGS (H1). 
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Debit: | Credit: 
1. With the cost or book value of entire 1. With the amount reserved as ac- 
buildings or parts of buildings dis- cumulated depreciation on build- 
earded or destroyed. (Credit ings as shown by the balance sheet 
Buildings. ) at the time of opening the books. 
2. At the end of the fiscal period with 
the estimated amount of depreci- 
ation. (Debit Depreciation of 
plant.) 
| 
Where an entire roof, floor, or other part of a building is renewed, the original cost 
of the renewed part should be charged to this account, and the cost of the renewal 
to the Buildings account. Fireproof buildings of modern construction should be 
depreciated from 1 to 2 per cent annually and frame structure from 3 to 5 per cent. 
RESERVE FOR DEPRECIATION, MACHINERY AND EQUIPMENT (H2). 
Debit: | Credit: 
1. With the cost or book value of ma- 1. With the amount reserved as ac- 
chinery or equipment destroyed or cumulated depreciation on ma- 
discarded. (Credit Machinery and |) chinery and equipment as shown 
equipment. ) by the balance sheet at the time of 
2. With the difference between the cost opening the books. 
value and amount realized from 2. With the estimated amount of de- 
items sold. (Credit Machinery preciation at the end of the fiscal 
and equipment. ) period. (Debit Depreciation on 
plant.) 
3. With any amounts realized on sales 
of machinery and equipment 
which have previously been 
charged to this account. 
Owing to the conditions existing in some types of plants, because of the peculiar 
nature of the work involved, the wear and tear of machinery and equipment is exces- 
sive. Special consideration should be given to these plant conditions in order that 
adequate reserves for depreciation may be provided. Further discussion will be 
; found under ‘‘Machinery and equipment.”’ 
RESERVE FOR DEPRECIATION, OrricE FURNITURE, AND EQUIPMENT (H3). 
Debit: Credit: 
1. With the cost or book value of items 1. With the amount reserved as ac- 
destroyed or discarded. (Credit Of- cumulated depreciation on Furni- 
fice furniture and equipment.) ture and equipment as shown by 
2. With the difference between cost and the balance sheet at the time of 
amount realized from items sold. opening the books. 
(Credit Office furniture and equip- 2. With the estimated amount of de- 
ment. ) preciation at the close of the fiscal 
period. (Debit Depreciation on 
plant.) 
3. With any amounts realized on sales 
of items which have previously 
been charged to this account. 
