14 BULLETIN 236, U. S. DEPARTMENT OF AGRICULTURE. 
ink and deducted in the addition of the items in the column, The 
several columns of the expense account may be headed "Salaries;" 
"Telephone, telegraph, and electric light;" "Taxes;" "Gasoline;" 
"Repairs;" and "Miscellaneous," or similar headings suitable to the 
nature of the expenses incurred. 
An account should be provided showing the capital stock outstand- 
ing or the portion of the net capital which is used or is available for 
the working of the business. 
Separate accounts should be opened for each kind of grain handled, 
showing the amount and value of grain purchased on the debit, and 
the amount and value of grain sold on the credit. At the end of the 
year, by crediting these accounts with the inventory of the kind of 
grain specified, the net profit on each kind of grain may be deter- 
mined. In the case of local sales of grain, it is advisable to open 
separate accounts so that a clear record may be kept of the amount 
of grain sold locally, as well as in car lots. These local sales accounts 
should be closed into the general gram accounts at the end of the year. 
During the course of a shipping season a considerable number of 
claims will arise against railroads for losses of grain in transit. Two 
accounts should be opened to accommodate this condition: A debit 
account — claims against railroads for leakage in transit, and a credit 
account — loss and recovery on grain leakage in transit. These 
accounts operate after the following manner : When a car is reported 
short a certain number of bushels under that recorded by the elevator's 
automatic scale, a charge is put through against the railroad respon- 
sible in the first-named account, and a corresponding credit is carried 
to the latter account. When recovery is received by remittance 
from the railroad company, the company is credited with the amount 
of the check. If the check does not cover the full amount of the 
claim, and no further action is to be taken looking toward its collec- 
tion, then a journal entry for the remainder should be passed, credit- 
ing the account of the railroad in the claims account and debiting 
loss and recovery on grain leakage in transit. This latter account 
constitutes an income account and may be written off direct to profit 
and loss; or if the composition of the account is known, the specific 
items applying to certain kinds of grain may be credited to the grain 
accounts. 
The following entries in the cash, journal, purchase, and sales 
record will serve to illustrate the method of accounting for loss and 
recovery on grain leakage in transit. When the grain is reported lost, 
the first entry to be made is as follows : 
Debit Claims (B. & M. Railroad) 25.00 
Credit Loss and recovery on grain leakage in transit 25. 00 
After negotiations with the railroad, assume that settlement by 
an allowance of $15.00 is received by check. Entry would then be 
