SYSTEM OF ACCOUNTING FOR COOPERATIVE ASSOCIATIONS. 23 
The balance of $1,000 is then credited to the Surplus account. All 
closing entries should be made through the journal and not arbi- 
trarily on the face of the ledger. It will be found advisable to list 
all items of profit and loss on the Profit and Loss account instead of 
showing these in total according to the journal entry. This will 
preclude the necessity of turning back to the journal each time it is 
desired to know the details of the items appearing in the Profit and 
Loss account. 
After all closing entries have been made, a post-closing trial balance 
should be taken to test the accuracy of the work. This schedule 
will be found valuable in preparing the balance sheet. A full expla- 
nation of the preparation of the annual statement will be found in 
U. S. Department of Agriculture Bulletin No. 178, " Cooperative 
Organization Business Methods." 
SECOND METHOD. 
It will be seen that the method first given does not provide for any 
growers' accounts except for the sale of supplies. The second method 
contemplates the opening of ledger accounts for all growers. These 
present a complete record of the transactions with each individual 
grower. This method should be used in organizations where the 
supply business has been fully developed, and charges should be 
made at frequent intervals throughout the year to the growers' 
accounts. 
After the remittance covering the shipment has been received and 
credited on the cash book and it is desired to make payment to the 
growers, the distribution of the proceeds is made on the manifest as 
in the previous method shown. The account sales are written up, 
and a journal entry is made as follows: 
Fruit $600. 00 
To growers $536. 75 
commission 28. 25 
broker 10.00 
icing 25.00 
If each car is made up of the combined shipments of but two or 
three growers, the name of each grower should be shown in the above 
entry with the amount of the credit opposite. If, however, the cars 
are made up of the shipments of many growers, the total credited 
to the growers' accounts should be shown in the journal entry, and 
the posting of the individual items should be made from the account 
sales to the ledger accounts. Should it be necessary to look up the 
details of this entry, the car number will give the reference to the 
information desired. Duplicate copies of the account sales are filed 
in folders under the growers' names, as explained under the first 
method. 
