16 BULLETIN 558, U. S. DEPARTMENT OF AGRICULTURE. 
er 
tories of manufactured gocds, should be derived from the monthly 
balances of accounts, as loss in the ledger. By means of this 
arrangement the frat balance will afford a complete check upon the 
monthiy operating statement which could not be attained if the 
ledger were ruied off each month. At the end of the year when the 
ledger is closed, the net balance of transactions for the complete year 
Sheela agree with the undistributed balance for the last month of 
operation, as shown by that month’s operating statement. 
CASH AND PETTY CASH. 
Tn order that a compiete trial balance may be taken from the ledger 
it is advisable to carry a ‘“‘Cash”’ account, representing the net atenes 
of available cash in the bank at the end of each oaue But one 
entry a month is necessary to this account, this bemg the difference 
between the totals of the ‘‘Bank deposits” column and the ‘‘Bank 
withdrawals’’ column as shown in the cash journal. If the total of 
the ‘‘Bank withdrawals” column should exceed that of the ‘‘Bank 
deposits’ column, this account will show a credit balance. Because 
of the fact that the entries to this account represent balances, it is 
not necessary to accumulate the items in the ledger from month to 
month. 
For convenience in paying out small sums of money in the form of 
cash for daily expenses and for making change, a petty cash fund 
should be established in a sufficient amount to fake care of these items. 
In order to establish this fund, a check shouid be drawn, crediting 
cash and debiting petty cash. The fund can then be used as needed. 
Vouchers for payments of petty cash should be kept on file until the 
end of the month, when an entry can be made in the cash journal 
debiting the proper expense accounts for which the payments were 
made and crediting petty cash. In some creameries it is the custom 
to use shipping tickets for the transportation of certain products, and 
in such cases it will be found convenient to purchase a supply of these 
tickets with the petty cash fund and to treat the tickets as petty cash 
on hand. ‘This will save a considerable amount of posting of small 
entries to the ‘‘Shipping ticket’’ account, as a summary of theexpendi- 
tures of this nature can be made at the end of the month and posted 
as one item.? 
INVENTORY AND EXPENSE ACCOUNTS. 
Accounts covering all inventoriable sup plies, such as coal, salt, and 
tubs, should be carried in the general ledger, together with their cor- 
responding expense accounts. As such goods are purchased the 
“Tnventory’’ account should be charged. The usage, as shown ke 
the physical inventory, should be credited to the “Inventory’’ ac- 
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1 ¥or further discussion of petty cash see U. S. Department of Agriculture Bulletin 178, Cooperative 
Organization Business Methods. 
ra ERNE a 
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