BOOK-KEEPING

making books: Plates of lead and copper, the barks of trees, bricks, stone, and wood, were the first materials employed to engrave such things upon as men were willing to have transmitted to posterity. Josephus speaks of two columns, the one of stone, the other of brick, on which the children of Seth wrote their inventions and astronomical discoveries: Porphyry makes mention of some pillars, preserved in Crete, on which the ceremonies practised by the Corybantes in their sacrifices were recorded. Hesiod's works were originally written upon tables of lead, and deposited in the temple of the Muses, in Bœotia: The ten commandments, delivered to Moses, were written upon stone; and Solon's laws upon wooden planks. Tables of wood, box, and ivory, were common among the ancients: When of wood, they were frequently covered with wax, that people might write on them with more ease, or blot out what they had written. The leaves of the palm-tree were afterwards used instead of wooden planks, and the finest and thinnest part of the bark of such trees, as the lime, the ash, the maple, and the elm; from hence comes the word liber, which signifies the inner bark of the trees: and as these barks were rolled up, in order to be removed with greater ease, these rolls were called volumen, a volume; a name afterwards given to the like rolls of paper or parchment.

Thus we find books were first written on stones, witness the Decalogue given to Moses: Then on the parts of plants, as leaves chiefly of the palm-tree; the rind and barks, especially of the tilia, or phillyrea, and the Egyptian papyrus. By degrees wax, then leather, were introduced, especially the skins of goats and sheep, of which at length parchment was prepared: Then lead came into use; also linen, silk, horn, and lastly paper itself.

The first books were in the form of blocks and tables; but as flexible matter came to be wrote on, they found it more convenient to make their books in the form of rolls: These were composed of several sheets, fastened to each other, and rolled upon a stick, or umbilicus; the whole making a kind of column, or cylinder, which was to be managed by the umbilicus as a handle, it being reputed a crime to take hold of the roll itself: The outside of the volume was called frons; the ends of the umbilicus, cornua, which were usually carved, and adorned with silver, ivory, or even gold and precious stones: The title στυλας, was struck on the outside; the whole volume, when extended, might make a yard and a half wide, and fifty long. The form which obtains among us is the square, composed of separate leaves; which was also known, though little used, by the ancients.

To the form of books belongs also the internal œconomy, as the order and arrangements of points and letters into lines and pages, with margins and other appurtenances: This has undergone many varieties; at first the letters were only divided into lines, then into separate words, which, by degrees, were noted with accents, and distributed, by points and stops, into periods, paragraphs, chapters, and other divisions. In some countries, as among the orientals, the lines began from the right and ran leftward; in others, as the northern and western nations, from left to right; others, as the Greeks, followed both directions, alternately going in the one, and returning in the other, called bouffrophodon: In most countries, the lines run from one side to the other; in some, particularly the Chinese, from top to bottom. See COMPOSITION.

B O O K - K E E P I N G.

BOOK-KEEPING is an art, teaching how to record and dispose the accounts of business, so as the true state of every part, and of the whole, may be easily and distinctly known.

Though the number and kinds of books used in this art be in some measure arbitrary, there are three which can never be dispensed with by those whose trade is complex or extensive, viz. the Waste-book, Journal, and Ledger.

I. Of the WASTE-BOOK.

THE Waste-book is a register, containing an inventory of a merchant's effects and debts, with a record of all his transactions, narrated in a plain, simple style, and in the exact order of time as they succeed one another.

The Waste-book opens with the inventory; which consists of two parts: First, the effects, that is, the money a merchant has by him, the goods he has on hand, his share in ships, houses, farms, &c. with the debts due to him; the second part of the inventory is the debts due by him to others: The difference betwixt which and the effects, is what merchants call neat stock. When a man begins trade, the inventory must be gathered from a survey of the particulars that make up his real estate; but must afterwards be collected from the balance of his old books, and carried to the new. This inventory is the first thing narrated in the Waste-book, as being the source and spring whence all subsequent transactions flow.

After the inventory is fairly narrated in the Waste-book, the transactions of trade come next to be jotted down;

down; which is a daily task, to be performed as they occur; and should be done distinctly, that is, every thing should be clearly and exactly expressed.

If no subsidiary books are kept, the Waste-book should contain a record of all the merchant's transactions and dealings in a way of trade; and that not only of such as are properly and purely mercantile, but of every occurrence that affects his stock, so as to impair or increase it; such as, private expenses, servants fees, house-rents, money gained or lost on wages, legacies, and the like. By such occurrences as these, a merchant as effectually becomes so much poorer or richer, as by the result of any branch of his trade. And the ends proposed in book-keeping can never be gained, if such things pass unrecorded.

II. Of the JOURNAL.

THE Journal is the book wherein the transactions recorded in the Waste-book are prepared to be carried to the Ledger, by having their proper debtors and creditors ascertained and pointed out.

One great design of the Journal is, to prevent errors in the Ledger; a thing of the worst consequence in book-keeping; which yet, without the help of this book, would be almost inevitable. For, suppose a person should attempt to form the Debtors and Creditors from the Waste-book in his mind, and at the same time post them to the Ledger, he shall find his thoughts so much embarrassed and over-charged, by attending at once to so many different things as occur here, that, were he an accountant of very great experience, he could not well miss of falling into frequent blunders. This makes it necessary to divide the task, and do at twice what cannot be performed at once, without such hazard of mistakes; that is, first to write out the Debtors and Creditors in a separate book by themselves, and afterward transfer them to the Ledger. The work by this means being divided into parts, becomes more simple, and consequently more easy, and so may be performed with greater certainty of its being right. Again, after the Ledger is filled up, the Journal facilitates the work required in revising and correcting it; for, first the Waste-book and Journal are compared, and then the Journal and Ledger. Whereas, to revise and correct the Ledger immediately from the Waste-book, would be a matter of no less difficulty than to form it without the help of a Journal. Lastly, The Journal is designed as a fair record of a merchant's business: For neither of the other two books can serve this purpose; not the Ledger, by reason both of the order that obtains in it, and also on account of its brevity, being little more than a large Index. Nor can the Waste-book answer this design; for being written up in the time of business, and commonly too by different hands, it can neither be fair and uniform, nor very accurate.

The Journal is a kind of middle book betwixt the other two; it looks back to the one, and forward to the other. With the Waste-book it agrees in form, being ruled after the same manner. The order also and succession of things is the same in both. The thing then

that distinguisheth the two books is the style; that of the one being natural, and that of the other artificial. In the Journal, persons and things are charged Debtors to other persons or things as Creditors; and in this it agrees with the Ledger, where the same style is used, but differs from it as to form and order: So that it agrees with the Waste-book in those very things wherein it differs from the Ledger; and on the other hand, it agrees with the latter in that very point wherein it differs from the former.

But an example of the Waste-book turned into the Journal form, will give a clearer idea than can be conveyed by words.

WASTE-BOOK.

JOURNAL.

Before proceeding to give rules for writing in the Journal, it will be necessary to take notice, that every case or example of the Waste-book, when entered in the Journal, is called a Journal post or entry: Thus the examples above make up three distinct posts. Again, a post is either simple or complex. A simple post is that which

has but one Debtor and one Creditor, as the first of these above. A complex post is either when one Debtor is balanced by two or more Creditors, as in the second post; or when two or more Debtors are balanced by one Creditor, as in the third post; or when several Debtors are balanced by several Creditors, and then the post is said to be complex in both its terms. This being premised, the rules to be observed are these following.

I. In a simple post, the debtor is to be expressly mentioned, then the creditor, and, lastly, the sum, all in one line: After which follows the narrative, or reason of the entry, in one or more lines, as in the first of these three posts above.

II. In a complex post, the several Debtors or Creditors are expressed in the first line, by Sundries, or Sundry Accounts, and the rest of the line filled up as in the

former rule. After which, the several Debtors or Creditors must be particularly mentioned, each in a line by themselves, with their respective sums subjoined to them; which are to be added up, and their total carried to the money-columns, as in the second and third posts.

The Journal, as described and exemplified above, is the form that was first in use among merchants; and is still the most common: but some make their Journal just a fair copy of the Waste-book, with the Debtors and Creditors written out on the margin, which is ruled large for that purpose. We shall here subjoin the three preceding posts done after this way; which, to one who understands the common method, will be sufficient instruction.

Of the Terms DEBTOR and CREDITOR.

THE nature and use of the terms Debtor and Creditor will be obvious, from the considerations following.

I. Accounts in the Ledger consist of two parts, which in their own nature are directly opposed to, and the reverse of one another; which therefore are set fronting one another, on opposite sides of the same folio. Thus, all the articles of money received go to the left side of the Cash-account, and all the articles or sums laid out are carried to the right. In like manner, the purchase of goods is posted to the left side of the account of the said goods, and the sale, or disposal of them, to the right, &c.

II. Transactions of trade, or cases of the Waste-book, are also made up of two parts, which belong to different accounts, and to opposite sides of the Ledger: e. g. If goods are bought for ready money, the two parts are, the goods received, and the money delivered; the former of which goes to the left side of the account of said goods, and the latter to the right side of the Cash-account.

III. These two different parts, in cases of the Waste-book, are not opposed to one another, as the two sides of the Ledger-accounts are; but, on the contrary, have

a mutual connection and dependence, the one being the ground, condition, or cause of the other. Thus, in the preceding example, when goods are bought for ready money, the receipt of the goods is the cause of parting with the money; and, on the other hand, the delivering of the money is the condition on which the goods are received.

From these three observations, it is plain, that, in order to post a case of the Waste-book to the Ledger, the first thing the accountant must do, is, to divide the case into its parts, and then to think with himself, to which account, and to what side, each of these parts is to be carried; and when the entry is actually made, the connection of the parts with one another must be expressed in each of the accounts to which they are transported. Now, since in speaking and writing things must have names whereby they may be expressed and written, it is necessary that two words or terms be contrived, and appropriated to these two different parts, that have the same relation to one another as the parts themselves have, which may at once characterise and distinguish the parts from one another, point out and ascertain to what side of the Ledger each of them is to be carried, and withal express their relation to, and dependence upon one another.

The Italians at first for this purpose pitched upon the terms

terms Debtor and Creditor, because their common acceptance comes nearer to the thing here meant than any other they could think on. By means of these terms, the two parts, in any case of the Waste-book, when posted to the Journal, are denominated, the one the Debtor, and the other the Creditor, of that post. And when carried from thence to the Ledger, the Debtor, or Debtor part, is entered upon the left side (hence called the Debtor side) of its own account, where it is charged Debtor to the Creditor part. Again, the Creditor, or Creditor part, is posted to the right side, or Creditor side of its account, and made Creditor by the Debtor part. Hence Italian book-keeping is said to be a method of keeping accounts by double entry, because every single case of the Waste-book requires at least two entries in the Ledger, viz. one for the Debtor, and another for the Creditor.

We shall illustrate what has been said by two examples. First, Suppose a merchant buys a pipe of wine for ready money, the two parts in this case are, the wine received, and the money delivered for it, which are characterised by the terms Debtor and Creditor in the Journal post thus: Wine Dr to Cash; where the meaning is, (though to express it so is needless), that as Wine is Dr to Cash, so Cash is Cr by Wine. And accordingly when carried to the Ledger, the Wine-account is charged Dr to Cash, and the Cash-account is made Cr by Wine. Again, 2dly. Admit the merchant sells this pipe of wine for present money, in this case the two parts are the same as before; but when clothed with Debtor and Creditor, will stand inverted thus: Cash Dr to Wine. And accordingly, in the Ledger, the Cash-account is charged Dr to Wine, and the Wine-account gets credit by Cash. From all which it is evident, the terms Debtor and Creditor are nothing else but marks or characteristics stamped upon the different parts of transactions in the Journal, expressing the relation of these parts to one another, and shewing to which side of their respective accounts in the Ledger they are to be carried.

RULES relating to Debtor and Creditor.

I. A thing received upon trust, is Dr to the person of whom it is received.

II. The person to whom a thing is delivered upon trust, is Dr to the thing delivered.

III. A thing received, is Dr to the thing given for it.

IV. In antecedent and subsequent cases, parts that are the reverse of one another in the nature of the thing, are also opposed in respect of terms.

V. In cases where personal and real Drs or Crs are wanting, the defect must be supplied by fictitious ones.

VI. In complex cases, the sundry Drs or Crs are to be made out from the preceding rules jointly taken.

We now proceed to the particular application of Debtor and Creditor in the several branches of trade, viz.

I. Proper trade, which a merchant carries on for himself.

II. Factorage, which he manages for another, called his Employer.

III. Partnership, which is carried on by a trustee, in name of all the partners.

1. IN PROPER TRADE.

Proper trade is either domestic or foreign. Proper domestic trade, is that which a merchant carries on by himself, without the help of a factor. Proper foreign trade, is the business that occurs to a merchant by employing a factor.

1st, Debtor and Creditor applied in proper domestic trade.

Proper domestic trade, comprehends the inventory, buying, selling, bartering, receiving money, and paying money. To each of these we shall assign a distinct problem; and, to prevent burdening the learner's memory, we shall deliver the several cases as compendiously as possible, subjoining to each problem such notes as seem necessary for clearing any thing that requires further illustration.

Note. As we refer from the cases and notes of each problem, to the examples of the Waste-book and Journal, by the dates, so we have made use of letters and numbers, as references from them to the cases and notes of the problems, which the reader will easily observe.

Prob. 1. A. Debtor and Creditor applied to the inventory.

The inventory consists of two parts, and accordingly is journalized at twice, viz. 1. Sundries Drs to Stock. The several Drs are, Cash, for the merchant's ready money; Goods on hand, for their respective values; Persons, for their debts due to him. 2. Stock Dr to Sundries. The several Crs are, the persons to whom the merchant owes. Compare the Waste-book and Journal, Jan. 1.

Note. Stock is a fictitious term used instead of the merchant's name.

Prob. 2. B. Debtor and Creditor applied in buying.

In buying one single commodity there are seven distinct cases, (viz. three simple, and four complex): in all which the goods bought and received are Dr; but the Cr varies according to the terms of purchase.

Case 1. When goods are bought for ready money, the entry is, Goods bought Dr to Cash. Jan. 6.

2. When goods are bought, and paid for by giving the seller a bill or note upon a third person, Goods bought Dr to the Acceptor, viz. the said third person.

3. When goods are bought on time, Goods bought Dr to the Seller. Jan. 10. Oct. 21.

4. When goods are bought for part money, part bill, Goods bought Dr to Sundries, viz.

To Cash, for the sum paid,

To Acceptor, for value of the bill.

5. When goods are bought for part money, part on time, Goods bought Dr to Sundries, viz.

To Cash, paid in part,

To Seller, for the rest. Jan. 15.

6. When goods are bought for part bill, part time, Goods bought Dr to Sundries, viz.

To Acceptor, for value of the bill,

To Seller, for the rest.

7. When goods are bought for part money, part bill, part time,

Goods bought Dr to Sundries, viz.

To Cash, for the sum paid,

To Acceptor, for value of the bill,
To Seller, for the rest. Feb. 2.

Note 1. When two or more kinds of goods are bought from one person at the same time, there will be two or more Drs, viz. the several kinds of goods bought, each for their value. And the same variety of cases will occur here as when one single commodity is bought; so that, if the sundry goods be bought for ready money, or on bill, or on time, the entry will be,

Sundries Drs, { To Cash, if bought for ready money. Feb. 16.
To Acceptor, if on bill,
To Seller, if on time.

But if the sundry goods are bought for part money, part bill, or for part money, part time, or for part bill, part time, &c. It is best to resolve the case into two entries, viz. First charge the Goods Dr to the Seller, for their full value, as if they had been bought on time; and then make the Seller Dr to Cash, or to the Acceptor, or to both, (as the nature of the case is), for the part paid. Thus, suppose the goods are bought for part money, part bill, part time, the two entries will be,

1. Sundries Drs to the Seller, for the respective values of the goods.
2. Seller, Dr to Sundries, viz.
To Cash, for the sum paid,
To Acceptor, for value of the bill.

Note 2. If you buy goods to be received some time afterward; and, in prospect of this, advance some part of the price to the seller: in this case, charge the Seller Dr to Cash, for the sum advanced; and when you receive the goods, make them Dr to the Seller, for their full value. Or if immediately upon receiving them you clear with the seller, then make Goods received Dr to Sundries, viz. to the Seller, for the sum formerly advanced; and to Cash, for the sum now paid. In bargains of this nature, there is commonly a penalty agreed on to be paid by the seller in case of non-performance. Now, if in this case the seller happen to fail, you the buyer, upon receiving payment of the advanced money and penalty, enter Cash Dr to Sundries, viz. to the Seller, for the sum advanced, and now recovered, and to Profit and Loss, for the penalty; or, instead of using the general account, Profit and Loss, you may erect in the Debit an account, under the title of Refusal of bargain, which is to be made Debit for all the penalties of this nature you pay, and Credit for all you receive. May 13. If you buy goods to be received afterwards, without advancing any part of the price; it is sufficient to take a note of them in a pocket-book; and when you receive them, they are booked as goods presently bought.

Prob. 3. C. Debtor and Creditor applied in selling.

Selling is just the reverse of buying, and has the same variety of cases, viz. seven; whereof three are simple, and four complex: in all which, the goods sold and delivered are Cr; but the Dr varies according to the conditions of sale.

Case 1. When goods are sold for ready money, the entry is, Cash Dr to Goods sold. Feb. 25.

2. When goods are sold on bill or note, Acceptor Dr to Goods sold. March 17. See Note 7.

3. When goods are sold on time, Buyer Dr to Goods sold. March 1.

4. When goods are sold for part money, part bill, Sundries Drs to Goods sold, viz.

Cash, for the sum received.
Acceptor, for value of the bill. March 22.

5. When goods are sold for part money, part on time, Sundries Drs to Goods sold, viz.

Cash, received in part,
Buyer, for the rest. March 4.

6. When goods are sold for part bill, part time, Sundries Drs to Goods sold, viz.

Acceptor, for value of the bill,
Buyer, for the rest.

7. When goods are sold for part money, part bill, part time,

Sundries Drs to Goods sold, viz.
Cash, for the sum received,
Acceptor, for value of the bill,
Buyer, for the rest.

Note 1. Thus the entries in buying and selling one single commodity are just the reverse of one another; and this also holds in buying and selling two or more kinds of goods; which we shall therefore pass, referring the learner to the cases of buying in the preceding problem.

Note 2. If you sell goods to be delivered, not presently, but some time afterward, and receive money for advance, charge Cash Dr to the Buyer, for the sum received; and when you deliver the goods, charge the Buyer Dr to Goods, for their full value. But if, upon delivery of the goods, you immediately receive the remaining part of their price, enter Sundries (viz. the Buyer, for the sum received for advance, and Cash, for the sum now received) Drs to the Goods delivered. If you find you cannot perform the bargain, and be obli-

ged to return the money advanced, and pay the penalty, make Sundries (viz. the Buyer, for the sum advanced, and Profit and Loss, or Refusal of bargain, for the penalty) Drs to Cash now paid.

Note 3. If you sell a ship, house, &c. enter Cash, or the Buyer, Dr to ship or house, for the price they are sold at.

Note 4. If you send goods to A. B. and leave it to his choice, whether to keep or return them, erect an account under the title of Suspense-account, and charge it Dr to the Goods sent off. If the goods be returned, reverse the former entry. If he keep them, charge A. B. Dr to Suspense-account, for the value of the goods sent him. If he sends up the price, charge Cash Dr to Suspense-account. May 7. June 16.

Prob. 4. D. Debtor and Creditor applied in bartering.

Barter, or the exchanging of goods for goods, is nothing else but buying and selling blended together; the cases of which, if the goods received and delivered be of equal value, are these four.

Case 1. When one commodity is received for another delivered, enter Wares received Dr to Wares delivered. April 10.

2. When one commodity is received for two or more delivered, enter Wares received Dr to Sundries, viz. to the several wares delivered, for their respective values.

3. When two or more sorts of wares are received for one delivered, enter Sundries (viz. the several wares received, each for their value) Drs to Wares delivered. April 16.

4. When several wares are bartered with A. B. for several, make two entries, and that whether the wares received and delivered be of equal value or not.

1. A. B. Dr to Sundries, viz. to each sort delivered, for their respective values.

2. Sundries (viz. each sort received, for their respective values) Drs to A. B. April 30.

Note 1. Supposing the goods received and delivered are not in themselves of equal value, but that the deficiency is made up by money or bill, or the one merchant gives the other credit for the difference: upon this supposition there will be several other cases; such as, 1. Wares received, for part wares, part money. 2. For part wares, part bill. 3. Part wares, part time. 4. Part wares, part money, part time, &c. In all which cases, the Wares received are Digo Sundries. The particular Crs in each case are as follows.

Case 1. { To Wares delivered, for their value,
To Cash, for the sum paid.

2. { To Wares delivered, for their value,
To Acceptor, for the bill.

3. { To Wares delivered, for their value,
To dealer, for the rest.

4. { To Wares delivered, for their value,
To Cash, for the sum paid,
To Dealer, for the rest.

Note 2. On the other hand, wares in barter may go off, or be delivered, 1. For part wares, part money. 2. For part wares, part bill. 3. Part wares, part time. 4. Part wares, part money, part time, &c. In all which cases, Sundries are Drs to the Wares delivered. The particular Drs in each case are the same with the Crs in the cases immediately preceding, as follows.

Case 1. { Wares received, for their value,
Cash, for the sum received. April 22.

2. { Wares received, for their value,
Acceptor, for the bill.

3. { Wares received, for their value,
Dealer, for the rest.

4. { Wares received, for their value,
Cash, for the sum received,
Dealer, for the rest.

Prob. 5. E. Debtor and Creditor applied in receiving money.

In all cases of this nature, Cash is Dr; but the Cr varies, according to the terms on which the money is received.

Case

Case 1. When you receive money for goods presently sold, the entry, as already mentioned in the first case of selling, is, Cash Dr to Goods sold, for their value. Feb. 25.

2. When you borrow, or take up money at interest, enter Cash Dr to the Lender, for the sum received, mentioning the rate of interest, and time of payment.

3. When you get money, whether as payment of a debt, or taken up at interest, and receive it, not from the debtor or lender, but upon his assignment from a third person, enter Cash Dr to the Assigner, not to him that pays it.

4. When you receive money, as payment of goods formerly sold, or in payment of an accepted bill or note, or any other debt, where neither discount nor interest is allowed, enter Cash Dr to the Payer, for the sum received, mentioning whether in full or in part. Feb. 5. March 23. April 6. July 30. Aug. 3. Nov. 12.

5. When you receive money, as payment of an accepted bill or note, or any other debt, (except for goods formerly sold), per advance, and upon that account allow discount, or abatement on any other consideration, enter Sundries Drs to the Payer, viz.

Cash, for the sum received,

Profit and Loss, for the sum discounted or abated.

Nov. 12.

6. When, in receiving payment for goods formerly sold, you allow discount or abatement; if the account of said goods be closed in the Ledger, enter as in the last case: but if the said account be yet open, enter thus, Sundries Drs to the Buyer, viz.

Cash, for the sum received,

Goods, for the sum discounted or abated. April 1.

7. When you receive money, as interest of a sum formerly lent, the principal being continued, enter Cash Dr to Profit and Loss, or to Interest account, for the sum received. Sept. 10.

8. When you receive both principal and interest, enter Cash Dr to Sundries, viz.

To the Borrower, for the principal,

To Profit and Loss, or to Interest-account, for the interest Nov. 8.

9. When you receive money as the premium for insuring another man's ship or goods at sea, enter Cash Dr to Insurance account, or to Profit and Loss.

10. When you receive money as the price of a ship, house, or estate, presently sold, or as the freight, or the rent of them, supposing the hiring out of the ship, or setting of the house, &c. not to be booked, enter Cash Dr to such a Ship, House, or Estate. Sept. 1.

11. But if the hiring out of the ship, house, or estate, was formerly booked, the entry for money received as freight or rent will be, Cash Dr to the Freight or Tenant.

12. When you receive money, in legacy or compliment, or with an apprentice, or as gained on a wager, or by exchange of money, &c. for which nothing goes out, enter Cash Dr to Profit and Loss, or to Stock.

Note 5. It commonly happens that legacies are not paid presently; and in this case you must charge the executor A. B. Dr to Profit and Loss, till you receive payment; and then discharge him by Cash, or the Thing received. June 3.

Prob. 6. F. Debtor and Creditor applied in paying money.

In all cases of this nature, Cash is Cr; but the Dr va-

ries, according to the terms on which the money is delivered.

Case 1. When you pay money for goods presently bought, the entry (as already stated in the first case of buying) is, Goods bought Dr to Cash, for the sum paid. Jan. 6.

2. When you lend or give out money at interest, enter the Borrower Dr to Cash, for the principal, mentioning the rate of interest, and time of payment. March 10. August 6.

3. When, by order of your creditor, you pay money to any person, enter the Assigner (not the Assignee) Dr to Cash, for the sum paid.

4. When you pay for goods formerly bought, or pay an accepted bill or note, or any other debt, where neither discount nor interest is allowed; enter the Receiver Dr to Cash, for the sum paid, mentioning whether in full or in part. Jan. 15. Jan. 30. March 10. and 23. May 3. June 8. June 22. and 29.

5. When you pay an accepted bill or note, or any other debt, (except for goods formerly bought), per advance, and upon that account have discount allowed you, or abatement on any other consideration; enter

Receiver Dr to Sundries, viz.

To Cash, for the sum paid,

To Profit and Loss, for the sum discounted.

6. When, in paying for goods formerly bought, you have discount or abatement allowed; if the account of said goods in the Ledger be closed, enter as in the last case; but if the said account be yet open, enter thus,

Receiver Dr to Sundries, viz.

To Cash, for the sum paid,

To Goods, for the sum discounted or abated.

7. When you pay the interest of a sum formerly borrowed, the principal being continued in your own hand; enter Profit and Loss, or Interest account, Dr to Cash, for the sum paid.

8. When you pay both principal and interest, enter Sundries Drs to Cash, viz.

Lender, for the principal,

Profit and Loss, or Interest-account, for the interest.

9. When a ship or goods you have formerly insured happens to be lost, and thereupon you pay the value to the owners, enter Insurance-account Dr to Cash, for the sum paid.

10. When you pay for a ship, house, or estate, presently bought; or pay repairs, taxes, or other charges on them: enter Ship, House, or Estate, Dr to Cash, for the sum paid.

11. When you pay charges on goods, as freight, portage, &c. enter Goods Dr to Cash, for the sum paid.

12. When you pay charges that relate to trade in general, such as warehouse rent, shop-rent, shop-keepers wages, postage of letters, &c. enter Charges of merchandise Dr to Cash. July 2. July 5.

13. When you pay your landlord rent for a dwelling-house, servants their wages, or make any disbursements for yourself or family; as all expences of this nature should be collected in a small book by themselves; so, when you bring them to the Journal, enter thus: House-expences Dr to Cash, for the total. Nov. 11. Dec. 30.

14. When you pay upon losing a wager; or when you lose upon exchange, that is, put off a piece of coin for less than it cost you; or when you give away money in charity, or any other way not yet mentioned, for which nothing comes in; enter Profit and Loss Dr to Cash Oct 22.

Note 1. An assignment differs as to its nature and form from a bill or note; but the general entries are the same with respect to all of them. In an assignment there are three persons concerned: 1. He who gives the assignment, called the Assignor. 2. He on whom the assignment is given, or by whom it is payable, called the Assignee. 3. He to whom it is payable, called the Assignee. Here we shall propose two or three cases not yet taken notice of. 1. Suppose you pay a debt to Samuel Neely, by an assignment on Peter Pandell, the entry is, Samuel Neely Dr to Peter Pandell. 2. If A. B. give an assignment or bill on you to M. S., which you do not pay presently; in this case, charge A. B. Dr to M. S.. 3. If A. B. give you an assignment or bill on G. H., which he does not pay presently, charge G. H. Dr to A. B.. 4. If J. H. draw a bill on you to G. L. payable against a certain day, which you pay presently, upon having discount allowed you; in this case, make J. H. Dr to Sundries, viz. to Cash, for the sum paid, and to Profit and Loss, for the sum discounted.

Note 2. If you pay a debt with goods, instead of money, the goods delivered, and not Cash, will be Cr. A. B. 1. If you pay A. B. in goods, for goods formerly bought, or for a bill you have formerly accepted, and that whether in full or in part, enter A. B. Dr to the Goods, for their value. 2. If you pay him on the same account, part goods, part money, charge A. B. Dr to Sundries, viz. to Goods, for their value, and to Cash, for the rest. 3. If you give him goods above the debt, and he presently pays you back the balance in money, enter Sundries, viz. A. B., for the sum of the debt, and Cash, for the balance Dr to Goods, for their full value. 4. If you give him goods above the debt, but do not presently receive the balance, enter simply A. B. Dr to Goods delivered, for their value. 5. If you pay interest of a bond, or sum borrowed, with goods, charge Profit and Loss Dr to the Goods delivered, &c.

Note 3. To prevent filling up your Ledger with accounts for every small dealer, you may erect a general account, under the title of Debt Journal, and charge it Dr for all such petty debts, mentioning in each entry the account to which, the person's name, and sum; and give it credit for all the payments, expressing also the accounts by which, with the persons names, and sums of money. To this credit-side also carry all such small debts you owe, and debit the account as you pay. Or, if you incline to be more distinct, erect two general accounts; one called Debt receivable, and the other Debt payable. Charge the former with all the petty debts due to you, and give it credit as you receive payment. Make the latter Cr for all the small debts due by you to others, and charge it Dr as you pay.

Note 4. In like manner, to save the labour of opening an account in the Ledger for every person you may have a bill upon, or who may have one on you, erect two general accounts; one, by the title of Bills receivable, and the other, Bills payable; and charge the former Dr for all the bills accepted, and payable to you, and give it credit as you receive payment. March 17. and 23. Make the latter Cr for all the bills you accept, and charge it Dr as you pay. Oct. 3. Sept. 10.

Note 5. If the person have an account already opened in your Ledger, or if you have the prospect of dealing with him in other things for the future, you are not to use these general accounts.

Note 6. The entries mentioned in this and the preceding problem, with respect to wagers, suppose, that the wager is gained or lost, and the bets paid, before the wager is hooked; which is indeed the best way, if the wager is very soon to be determined. But if you enter into a wager that cannot be soon decided, and thereupon consign the bets in a third person's hands; in this case, it is proper to erect an account under the title of Wagers account, and charge it Dr to Cash, for the sum consigned. If you gain the wager, and receive the bets, enter Cash Dr to Wagers account, for the sum received; if you lose, make Profit and Loss Dr to Wagers account, for the sum formerly consigned, and now lost. Sometimes the bets are consigned in one of the parties hands. Thus, in April 1734, two gentlemen in London entered into a wager concerning the reduction of Dartmouth by the Russians; whereupon one of them consigned 100 guineas in the other's hands, upon condition that he should pay him three guineas a-day till the city should be taken or surrendered. In this case, if you receive the 100 guineas, enter Cash Dr to Wagers account; and when the wager is determined, make Wagers account Dr to Cash, for all you pay back. If you consign the 100 guineas, charge Wagers account Dr to Cash; and when the wager is decided, make Cash Dr to Wagers account, for all you receive back.

Note 7. These accounts, viz. Refusal of bargains, Interdict, Bottomry, Insurance, House expenses, are of the same nature with the general account Profit and Loss, being nothing else but particular branches of it; and the only design of keeping them distinct is, in order to know what is gained or lost on each of these several heads.

Note 8. When a ship or goods you have insured to another happens to be lost at sea, and thereupon you pay the value; after this the subject lost becomes your own; and if any of the wreck be recovered, enter the thing recovered Dr to Insurance account, for its value, and charge Insurance account Dr to Cash, for what you expend in search of it.

Note 9. If you have frequent occasion to deal in outlandish money, or pieces not current, you may erect an account under the title of Foreign coin, or, particularly, Spanish coin, &c. and charge it Dr for what pieces you receive, and give it credit as you put them off. March 23. March 23.

Note 10. If any parcel of goods happen to be damaged or lost, or liquor to be spilled, &c. charge Profit and Loss Dr to the Accounts of the goods or liquor, for the value of the damage, loss, or of the quantity spilled, &c.

Note 11. We shall now conclude proper domestic trade, by reminding the learner, in putting any case to the Yourselves, carefully to consider, whether it be opposed in any of its parts to some preceding one; otherwise no rules, however particular, can be sufficient to direct his practice. For if the parts of a former and subsequent case be the reverse of one another, they must also be opposed in respect of terms, notwithstanding whatever particular rules may seem to say. Thus, suppose A. B. accepts a bill payable to you, and thereupon you charge, not A. B. but the general account Bills receivable Dr; it is plain, that when you receive payment, you must enter Cash Dr, not to A. B. but to Bills receivable, notwithstanding what is said, prob. 5. case 4.

See March 17. and 23. Again, admit you accept a bill payable to A. B. and thereupon credit, not A. B. but the general account Bills payable; it is evident, that when you pay, you must charge, not A. B. but Bills payable Dr to Cash, notwithstanding prob. 6. case 4. See Sept. 3. and 10.

2dly, Debtor and Creditor applied in proper foreign trade.

Proper foreign trade comprehends, 1. The shipping of goods to a factor. 2. Advice concerning them from the factor. 3. Returns made by the factor to you.

Prob. 1. G. Debtor and Creditor applied in shipping off goods to a factor.

In all cases, voyage to ——— is Dr; but the Cr. varies, according as the goods shipped off are already entered in your books, or presently bought; and that again, either for ready money, or on time, &c.

Case 1. If you ship off goods which are already entered in your books, enter

Voyage Dr to Sundries, viz.

To the respective Goods, for their value,

To Cash, for custom, insurance, and all other charges.

2. If you buy a cargo for ready money, and ship it off immediately, without entering the purchase in your books, enter Voyage Dr to Cash, for prime cost, and all charges.

3. If you buy goods on time, and ship them off, without entering them in your books, enter

Voyage Dr to Sundries, viz.

To Seller, or Sellers, for value of the goods,

To Cash, for charges at shipping.

4. If you ship off a cargo, made up partly of goods taken from your own warehouse, partly of goods bought, on time, enter

Voyage Dr to Sundries, viz.

To Goods your own, for their value,

To Seller or Sellers, for value of the goods bought,

To Cash, for all charges. Jan. 21.

Note 1. Several other cases may be supposed; such as, 1. When the cargo consists of goods, part your own, part bought for ready money. Or, 2. Part your own, the rest bought, part for ready money, part on time. July 22. Or, 3. All bought, part for ready money, part on time. Or, 4. Part your own, part bought, part immediately received in barter, or as payment of a debt. But the way of journalizing these and the like cases, may be easily gathered from what is already said; and therefore we shall leave them for the learner's exercise.

Note 2. If you do not pay charges at shipping immediately, you must credit the Payee to whom it is due, and not Cash; or, if you please, erect a general account, under the title of Debt payable, or Charges payable, and charge Voyage Dr to it, and as you pay enter it Dr to Cash.

Note 3. As Voyage is to be debited for all charges, or whatever augments the cost, so it must be credited by whatever lessens the same, such as drawbacks on re-exported goods. Sept. 28.

Note 4. Instead of the title, Voyage to ———, some use Adventure to ———, or Adventure to ——— per such a ship; as, Adventure to Barbadoes per the Neptune.

Prob. 2. H. I. Debtor and Creditor applied, upon advice from your factor, A. B.

H § 1. The cases of the first advice.

In all cases of the first advice, Voyage to ——— is Cr; but the Dr varies, according to the nature of the advice.

Case 1. If the first advice be, That A. B. has received your goods, but sold none of them, enter A. B. my account of goods Dr to Voyage, for the sum the said voyage was formerly charged with.

2. If the first advice be, That A. B. has received the goods, and sold them for ready money, enter A. B. my account current Dr to Voyage, for the neat proceeds; that is, the sum due to you, after the factor's commission and all charges are deduced. Sept. 22.

3. If the first advice be, That the goods are received, and all sold on time, enter A. B. my account on time Dr to Voyage, for the neat proceeds.

4. If the first advice be, That they are received, and all sold, part for ready money, part on time, enter Sundries Drs to Voyage, viz.

A. B. my account current, for the money in his hands,

A. B. my account on time, for the debts outstanding.

5. If the first advice be, That the goods are not only received and sold, but a cargo shipped in return, and now at sea; here there are three varieties. 1. If the value of the cargo inward, with charges paid by the factor, be equal to the neat proceeds, enter Voyage inward Dr to Voyage outward, for the neat proceeds. 2. If the factor overship the neat proceeds, enter Voyage inward Dr to Sundries, viz. to Voyage outward for the neat proceeds, and to Factor my account current, for the rest. 3. If he undership the neat proceeds, enter Sundries (viz. Voyage inward, for its value, and A. B. my account current, for the rest) Drs to Voyage outward. June 18

6. If the first advice be, whether from the factor or any body else, That the ship and cargo is lost at sea, there will be also three varieties. 1. If the goods lost were not insured, enter Profit and Loss Dr to Voyage, for the whole value. 2. If the goods lost were all insured, charge the Insurer, or Cash, if you get present payment, Dr to Voyage. 3. If part of the goods only were insured, make Sundries (viz. the Insurer, or Cash, for the value insured, and Profit and Loss, for the rest) Drs to Voyage, for the whole loss.

I. § 2. The cases of the second advice.

In journalizing a second or third advice, respect must be had to the entry that was made upon the advice immediately preceding; for whatever was then Dr, must be now made Cr. And therefore, supposing the first or former advice was, That the factor had received the goods, but sold none of them, the entry to be made upon a second advice will be as in the cases following.

Case 1. If the second advice be, That the goods formerly received are now sold, in whole or in part, for ready money, enter A. B. my account current Dr to ditto my account of goods, for neat proceeds.

2. If the second advice be, That goods received formerly are now sold in whole or in part, on time, enter A. B. my account on time Dr to ditto my account of goods, for neat proceeds.

3. If the second advice be, That goods formerly received are now sold, part for ready money, part on time, enter Sundries Drs to A. B. my account of goods, viz.

A. B. my account current, for the money in his hands,

A. B. my account on time, for the outstanding debts.

But if the former advice had been, That the factor had sold your goods on time, then upon this supposition, the advice that comes next, whether second or third, is journalized as follows.

Case 1. If the next advice be, That the factor has now received payment of the debts outstanding, enter A. B. my account current Dr to ditto my account on time, for the sum received by him.

2. If the next advice be, That he has indeed received payment of the debts, but was obliged to allow abatement, for inlack of goods, or for other reasons, enter Sundries Drs to A. B. my account on time, viz.

A. B. my account current, for the sum received by him,

Profit and Loss, for the sum abated.

Prob. 3. K. L. Debtor and Creditor applied, when returns are made you by the factor.

Returns are made in goods or bills.

K. § 1. The cases of returns in goods.

Case 1. If the factor ship off, and consign goods to yourself, advising you thereof by post, before the arrival of the ship, enter Voyage from—Dr to A. B. my account current, for cost and charges of the cargo, as per factor's invoice.

2. If the factor ship off goods for yourself, of which you have no advice, or of which you book no advice, prior to the arrival of the ship, enter

Goods received Dr to Sundries, viz.

To A. B. my account current, for cost and charges, as per invoice,

To Cash, for new charges paid here.

3. If your factor A. B. at Leighorn ship off goods not to yourself, but by your order, to C. D. your factor at Lisbon, and advise you thereof by sending you a copy of the invoice, enter Voyage from Leighorn to Lisbon Dr to A. B. my account current, for cost and charges, as per invoice.

Note 1. The entries in this problem suppose that you have received the account of sales, and debited the account current, for neat proceeds; which naturally leads to give the account current credit here, and shows how the Dr part of a prior entry is reversed, or becomes Cr in a posterior one.

Note 2. There are two or three cases relative to those mentioned, which we shall here take notice of. 1. When the ship and cargo mentioned in case 1. arrives, you enter Goods received Dr to Sundries, viz. to Voyage hither, for what it was charged with, and to Cash, for charges paid here. Or, if you please, first charge Voyage Dr to Cash, for charges, see July 9; and then discharge the Voyage by the Goods, see July 10. Or, if you dispose of all or any part of the cargo on the key, viz. before the voyage is discharged in your books, enter the Buyer, or Cash, or Thing received, Dr to the Voyage, see July 9. 2. If the ship and cargo should happen to be lost at sea, then if the goods be not insured, you enter Profit and Loss Dr to Voyage inward, for what it was charged with. But if the cargo be insured, charge the Insurer, or Cash, if you get present payment, Dr to Voyage, &c. 3. If a cargo consigned to you happen to be lost at sea, which you have notice of before any entry is made in your Books; in this case, enter Profit and Loss, the Insurer, or Cash, Dr to A. B. my account current, for the value lost.

L. § 2. The cases of returns in bills.

Case 1. If you draw upon your factor, and receive present money for the bill, enter Cash Dr to A. B. my account current, for value of the bill.

2. If you draw upon your factor, and give the remitter a day for payment; or if you owe the remitter, and give him the bill as payment; enter the Remitter Dr to A. B. my account current, for the value of the bill July 15.

3. If you draw upon your factor A. B. payable to your factor C. D. charge C. D. my account current Dr to A. B. my account current, for value of the bill.

4. If your factor remit you a bill, for which you receive present payment, enter Cash Dr to A. B. my account current, for the value of the bill.

5. If your factor remit you a bill, payable at single or double usance, or any other time after date or sight; upon getting the bill accepted, enter Bills receivable Dr to A. B. my account current, for value of the bill. Sept. 30.

6. If your factor A. B. by your order, remit a bill to your factor C. D. charge C. D. my account-current Dr to A. B. my account-current, for value of the bill.

2. IN FACTORAGE.

FACTORAGE comprehends three things: 1. The receipt of the employer's goods. 2. The disposal of them. 3. Returns made for them.

Prob. 1. M. Debtor and Creditor applied upon the receipt of goods.

WHEN you turn factor, and have goods consigned to you by your employer; upon receiving the goods, enter A. B. his account of goods Dr to Cash, for freight, custom, or other charges you pay. Aug. 10.

Note 1. If there be but one kind of goods, namely; as, A. B. his account of freight, A. B. his account of freight, &c.
Note 2. Instead of the title A. B. his account of goods, come use A. B. his sale or A. B. his sale per sub a fact, as A. B. his sale per the brookers.

Note 3. In the following set of books, in regard no ledger-book is supposed to be kept, the consigned goods are enumerated in the Waste-book; but in real business, or where an Invoice-book is kept, the common practice is, to copy them directly into it; and in the Waste-book, to mention only the money paid for freight, or other charges, without taking any notice of the names or quantity of the goods. Thus, the entry in the Waste-book, Aug. 10. is written in this manner, would stand as follows.

Paid freight, custom, wharfage, portage, &c. of sundry goods for the Grigs, John Toulle matter, consigned from Herman Van Beck of Amsterdam, for sale and returns, 141. 12s. 6d.

Prob. 2. N. Debtor and Creditor applied in disposing of your employer's goods.

Case 1. WHEN you sell all, or any part of your employer's goods, for ready money, enter Cash Dr to A. B. his account of goods, for the sum received. Aug. 17.

2. When you sell all, or any part of his goods, on time, charge the Buyer Dr to A. B. his account of goods, for the sum due. Aug. 23.

3. When you take all, or any part of his goods, to yourself at the current price; or when you put off his goods in barter, for others which you take to yourself; enter Goods received Dr to A. B. his account of goods, for their value.

4. When all your employer's goods are disposed of, balance his account of goods; that is, charge A. B. his account of goods Dr to Sundries, viz. to Cash, for any charges paid by you, not yet booked; or to the person or persons to whom they are due, if not yet paid; and to Profit and Loss, for your commission; and to A. B. his account on time, for the outstanding debts, if any; and to A. B. his account-current, for the employer's ready money in your hands. Aug. 23.

5. When you receive payment of the outstanding debts, enter as in proper trade, viz. Cash Dr to the Buyers; but if you be obliged to make abatement, for defect in weight or measure, or bad markets, &c. enter

Sundries Drs to the Buyer, viz.

Cash, for the sum received,

A. B. his account-current, for the sum abated.

6. When you receive payment of a debt on your employer's account, you must not only give the buyer or payer credit as directed above, but at the same time charge A. B. his account on time Dr to ditto his account-current, for the whole sum of the debt, whether any abatement be allowed or not.

Note 1. If you allow abatement to the buyers, while the account of goods is yet open, you may charge A. B. his account of goods Dr to the Buyers, for the sum abated.

Note 2. When you pay the persons mentioned in case 4. who get credit at balancing the account of goods, such as packers, preachers, porters, coopers, dyers, brokers, &c. enter as in proper trade, viz. Receiver Dr to Cash; but if they allow abatement, this being your employer's profit, not your own, charge the Receiver Dr to Sundries, viz. to Cash, for the sum paid, and to A. B. his account-current, for the sum abated. Aug. 31.

Prob. 3. O. P. Debtor and Creditor applied when you make returns to your employer.

Returns are made either in goods or bills.

O. § 1. The cases of returns in goods.

Case 1. WHEN you buy up goods for ready money, and ship them off for your employer, enter

A. B. his account-current Dr to Sundries, viz.

To Cash, for prime cost, and charges paid,

To Profit and Loss, for your commission.

2. When you buy goods on time, and ship them off for your employer, enter

A. B. his account-current Dr to Sundries, viz.

To Sellers, for prime cost of the goods,

To Cash, for charges, as custom, insurance, &c.

To Profit and Loss, for your commission.

3. When you take goods of your own, and valuing them at the current price, ship them off for your employer, enter

A. B. his account-current Dr to Sundries, viz.

To Goods sent off, for their value,

To Cash, for charges at shipping,

To Profit and Loss, for your commission.

Note 1. There may be several other cases; as, 1. When the goods shipped off are bought, part for ready money, and part on time, May 18. 2. When part of them are bought for ready money, part of them your own. Aug. 30. 3. When part of them are bought on time, the rest being your own. 4. When part of them are bought for ready money, part on time, part of them your own. All which being compounds of the cases mentioned, can prove no difficulty to the learner.

Note 2. The Journal Entry is the same, whether the goods shipped off be in return for goods sold by you, or in answer to your employer's commission, when you have none of its effects or money in your hand. May 18. The entry is also the same, whether the goods shipped off be consigned to himself, or by his order to his factor, or any other person.

Note 3. If the charges on shipping are not presently paid, the Cr will not be Cash, but the Receiver to whom they are due. May 18. Aug. 30. Or, if you please, the general account, Debit payable, or Charges payable. And when you pay, enter the Receiver, or Charges payable, Dr to Cash. May 21. But if abatement be allowed you, this being your employer's advantage, not your own, enter the Receiver, or Charges payable, Dr to Sundries, viz. to Cash, for the sum paid, and to A. B. his account-current, for the sum abated. Aug. 31.

Note 4. In like manner, when you pay for the goods mentioned case 2. enter as in proper trade, viz. the Sellers Drs to Cash; but if abatement be allowed you, you must charge the Sellers Drs to Sundries, viz. to Cash, for the sum paid, and to A. B. his account-current, for the sum abated.

P. § 2. The cases of returns in bills.

Case 1. WHEN your employer draws a bill on you, which you accept and pay on sight, enter A. B. his account-current Dr to Cash, for value of the bill.

2. When your employer draws a bill on you, payable at 1 or 2 usance, enter A. B. his account-current Dr to Bill payable, for value of the bill. Sept. 3.

3. When you draw upon your employer, enter Cash, if you receive present money for the bill; or, if not, the Remitter Dr to A. B. his account-current, for value of the bill. May 31.

4. When you remit a bill to your employer, for which you pay ready money, enter A. B. his account-current Dr to Cash, for value of the bill. Sept. 8.

5. When you remit a bill to your employer, which you either procure on time, or receive in payment of a debt due to you by the drawer, enter A. B. his account-current Dr to the Drawer, for value of the bill.

6. When

6. When your employer remits a bill to you, enter Cash, if you receive present payment; or, if not, Bills receivable, Dr to A. B. his account-current, for value of the bill.

Note 1. When you pay the bill mentioned in case 2. enter Bills payable Dr to Cash. Sept. 10.

Note 2 Charge A. B. his account current Dr to Cash, for all charges you pay in making returns, such as postage.

Note 3. Having now shewn how to keep factory-accounts in your own books, along with your other business, it will not be improper to observe, that these accounts may also be kept, by help of the Sales-book, without bringing any thing to your Ledger, or other books, except the account current, thus: Turn the Sales-book into a folio-form; and when you receive the consigned goods, enter them on the Dr side, mentioning their quantity, mark, and number, with the charges you pay; to which side also carry all after charges, abatements made to buyers, and your own commission. On the Cr side, enter the sales, mentioning the names of the buyers on time; and, as they pay, mark the article as paid on the margin; or, which will do just as well, never draw out the sums to the money columns, till you receive payment. In your Ledger, give A. B. his account current credit for all the money you receive for his goods, and make the same account Dr for all the charges paid by you, abatements made to buyers, your own commission, and returns made to your employer. But though this method may now and then be used with respect to small consignments; yet the conducting of large concerns in factory requires the use of all the five books mentioned at the beginning of this chapter.

Note 4. When you cannot dispose of your employer's goods to advantage, and thereupon by his order ship them off to a factor of your own, in expectation of a better market, the regular method in this case is, 1. When you ship off the goods, enter Voyage to—for account of your Employer, Dr to Cash, for charges paid at shipping. 2. When you have advice from your factor, that he has received them, enter your Employer his account of goods in the hands of factor, or rather your Employer his account of goods at such a place, Dr to Voyage thither, for charges of the said voyage. 3. When you have advice that he has sold them, e. g. for ready money, enter your Employer his account current at—Dr to ditto his account of goods at—, for neat proceeds. The entry in any other case will be obvious to one who understands proper trade and factorage, as explained above. But though this be the regular method, yet in real practice, the best way, in our opinion, is, when you ship the goods, to charge the employer's account of goods (as they stand in your Ledger) Dr to Cash, for charges at shipping, making no more entries, till you receive the Account of sales, and then charge A. B. his account of goods, for the neat proceeds; and discharge A. B. his account current at—, as returns are made to you by your factor.

3. IN PARTNERSHIP.

PARTNERSHIP is that branch of trade which is ma-

naged and carried on by a trustee, in the name, and for the account of the partners; that is, when a joint stock, made up by two or more merchants, is deposited in the hands of one person, to be employed by him in a way of commerce, according to instructions.

Merchants, upon entering into partnership, generally chuse one of their own number, to whom they commit the management of their company-concerns; who, on account of his being partner, as well as manager or doer for the company, is called partner-trustee; and shares of gains and losses that happen, according to his share of the stock; and must allow his proportion of all charges, even of his own commission, since, in quality of trustee, he serves himself as partner equally with the rest.

The accounts of the company's affairs may be kept by the trustee in his own books, along with the accounts of his own private business; or they may be kept in separate books allotted for that purpose. The former is common practice, in matters of small concern, or short adventures; the latter is used by fixed companies, whose trade is considerable, or who have the prospect of dealing long that way.

Hence it is obvious, that each partner will have occasion to keep an account in his own books, of every thing he gives in and receives from the company, and also of what he owes to the company, or they to him: and, on the other hand, it will be the business of the trustee, not only to keep clear accounts with the persons he deals with, in buying up and disposing of goods for the company; but he must also keep distinct accounts, with respect to the partners, shewing what share each of them gives in, and what part of neat proceeds is due to them, and likewise what every one of them owes to the company, or the company to them. These things premised,

1. We shall shew how a partner keeps the accounts which he has occasion for.

2. The way how a trustee keeps the accounts of the company's affairs in his own books.

3. The manner of keeping company-accounts in books, apart, that contain nothing else.

1. How a partner keeps the accounts he has occasion for.

The Ledger-accounts described.

A merchant concerned as partner in a company, must keep the two Ledger-accounts following; in which observe, that A. B. represents the trustee's name.

1. A. B. my account in company. This account is Dr for your inputs, and proportion of all charges, and Cr for your share of neat proceeds.

2. A. B. my account proper. This is a personal account, being charged and discharged exactly as such, for the mutual debts and payments betwixt you and the trustee.

Note 1. A. B. my account in company, is a general title, that may represent one or more kinds of goods; and that whether in the trustee's custody, or by him sent to sea. But different authors title this account differently. Some chuse to express it thus: Goods in the hands of A. B.; or particularly, Broad cloth in the hands of A. B. If it be a sea-adventure, you may use the title, A. B. my account of Voyage to—. If the company be

be fixed, the title may be taken from the commodity they deal in, as Account in Wine-company, account in Tobacco-company, &c.; or from the place they trade to, as Account in East-India company, &c.

Note 2. Instead of A. B. my account proper, some write A. B. my account-current; some too write A. B. his account current; and others title this account simply by the trustee's name. But though the titles of accounts are in some sort arbitrary, or as the merchant pleases, yet it is suitable or congruous, that they carry in them some badge of distinction, shewing to what class of accounts they belong.

We now proceed to a particular application of Dr and Cr in the cases that most commonly occur on this head, which shall be confined to the two problems following.

Prob. 1. Q. Debtor and Creditor applied, when you give in your share of stock to the trustee.

Case 1. If you give in just your own part; and that either, 1. In money, or in goods presently bought for ready money; or, 2. In goods presently bought on time; or, 3. In goods already entered in your books, enter A. B. my account in company Dr

To Cash, if you give in money, or pay for goods,
Off. 4.

To Seller, if you buy goods on time,

To Goods proper, if the goods were formerly your own.

2. If you find both your own part and the trustee's, enter Sundries (viz. A. B. my account in company, for your own part, and A. B. my account proper, for his part) Drs.

To Cash, if you give in money, or pay for goods,

To Seller, if you buy the goods on time,

To Goods proper, if you give in goods formerly your own, Off. 9.

3. If the trustee provide both your part and his own, enter A. B. my account in company Dr to ditto my account proper. And when you pay him, charge A. B. my account proper Dr to Cash. But if he demand interest, make Sundries (viz. A. B. my account proper, for the debt, and Profit and Loss, for the interest) Drs to Cash.

Note 1. There may be several other varieties in Case 1, besides those mentioned; as, 1. When you give in part money, part goods presently bought on time. 2. When you give part in money, part goods of your own. 3. When you give in goods, part bought on time, part your own. 4. When you give in part money, part goods bought on time, part goods of your own. In all which cases, enter A. B. my account in company Dr to Sundries, as follows.

Variety 1. To Cash, for the sum given in.
2. To Seller, for value of the goods bought.
3. To Goods proper, for their value.
4. To Seller, for value of the goods bought.
5. To Cash, for the sum given in.
6. To Cash, for the sum given in.
7. To Seller, for value of the goods bought.
8. To Goods proper, for their value.

Note 2. The like varieties may be supposed in Case 2. In journalizing of which, the best method is, first to enter A. B. my account in company Dr to Sundries, as in the former note, for the whole value of the money, and goods given in; and then, in another entry, charge A. B. my account proper Dr to ditto my account in company, for the trustee's part. And when the trustee pays you for his part, enter Cash Dr to A. B. my account proper, Off. 11. But if he pay you also interest, make Cash Dr to Sundries, viz. to A. B. my account proper, for the debt, and to Profit and Loss, for the interest.

Prob. 2. R. Debtor and Creditor applied, when goods in company are disposed of, and you receive all or part of your share of neat proceeds.

Case 1. If you have advice of sales, and at the same

time receive your share of neat proceeds; which may be either in money, bills, or goods; enter Cash, Bills receivable, or Goods received, Dr to A. B. my account in company, for value received, Off. 9. and 20.

2. If you have only advice of sales on time, without receiving any thing, enter A. B. my account proper Dr to ditto my account in company, for your share of neat proceeds due to you; and when you receive payment, charge Cash, Bills receivable, or Goods, Dr to A. B. my account proper, for value received. But if the trustees had been obliged to allow abatement to the buyers, or had any of the debts outstanding proved bad, then, in this case if the account in company be yet open, enter Sundries (viz. Cash, Bills receivable, &c. for the sum received, and, A. B. my account in company, for your share of the sum abated or lost) Drs to A. B. my account proper. If the account in company be balanced, charge Profit and Loss Dr for your share of the abatement, or of the loss.

3. If the goods are sold, part for ready money, part on time, and thereupon you receive your share of money received, enter Sundries (viz. Cash, for the sum you receive, and A. B. my account proper, for your share of sales on time) Drs to A. B. my account in company.

4. If part of the goods only are sold, you may put off the booking of it till further advice; unless it be for ready money, of which you immediately receive your share: in which case, enter Cash Dr to A. B. my account in company, for the sum you receive.

5. If you withdraw your share of stock, or any part of it, enter Cash, or Goods withdrawn, Dr to A. B. my account in company, for the sum or value withdrawn.

6. If after the goods are disposed of, you take up only your share of neat gain, continuing your share of stock as a fund for a new adventure, charge Cash Dr to Profit and Loss, for the sum received, and let the account in company stand as it is.

N. B. This is the ordinary case in fixed companies.

Note 1. There may be other varieties in Case 1. & 2. besides those mentioned; viz. 1. You may receive, as your share of neat proceeds, part money, part bill; and then Sundries are Drs, viz. Cash, and Bills receivable, Off. 9. 2. You may receive part money, part goods; and then the Drs are, Cash, and Goods received, Off. 20. 3. You may receive part bill, part goods; and then the Drs are, Bills receivable, and Goods received. 4. You may receive part money, part bill, part goods; and then there will be three Drs, viz. Cash, Bills receivable, and Goods received.

N. B. If the person on whom you get the bill have an account in your Ledger, make him Dr, and not Bills receivable.

2. How a trustee keeps the company's accounts in his own books.

The Ledger-accounts described.

A Trustee who keeps the company's accounts in his own books, has occasion for the three Ledger-accounts following, in which A. B. represent your partner's name.

1. Goods in company with A. B. or Sales in company with A. B. or particularly Sugar in company with A. B. This account is debited for the value of the goods brought into company, for all charges, and your commission: it is credited as you dispose of the goods, in the same manner as if the goods were your own.

2. A. B. his account in company. This is credited for your partner's inputs, his share of charges, and proportion of neat gain at close: it is debited for his share of neat

neat proceeds, and his proportion of loss, if any, when the company accounts are finished.

3. A. B. his account proper. This is a personal account, which is debited and credited for the mutual debts contracted and payments made betwixt you and partners.

Note 1. If the company deal in foreign trade, you who manage as trustee will have occasion for other accounts, viz. Voyage in company, Factor our account current, &c. all which are used the same way as their parallels in proper foreign trade.

Note 2. As you must keep an account in company, and an account proper, for each partner; so, if these be compared with the accounts of the like name kept by the partners, they will be found exactly the reverse of one another; that is, the Dr side of the accounts kept by you will be the same with the Cr side of those kept by partners; and on the other hand, the Cr side of the former will be exactly the Dr side of the latter.

Note 3. Instead of the title A. B. his account proper, a great many use A. B. his account current. And it must be owned the merchant is at liberty to do in this as he inclines; it comes to the same thing in the issue, only the one title is more distinctive than the other.

Prob. 1. S. Dr and Cr applied, when goods are brought into company.

Case 1. If the goods are bought, (which is either from you the trustee, or from a partner, or from a neutral person,) enter twice; viz. 1st, Goods in company Dr To Goods proper, if bought of yourself, } for value of
To Partner's account proper, if of a partner, } the goods.
To Cash, or Seller, if of a neutral person } bought.

2dly, Charge each partner his account proper Dr to ditto his account in company, for his part of the purchase
Off. 26. Nov. 22

Note 1. When you pay a neutral person for goods bought on time, charge the said Person Dr to Cash; and there is no second entry. Off. 27. Nov. 25. But if you allow discount or abatement, enter twice; namely, 1. Seller Dr to sundries, viz. to Cash, for the sum paid, and to Goods in company, for the sum discounted or abated. 2. Each partner's account in company Dr to ditto his account proper, for his share of the sum discounted or abated.

Case 2. If each partner bring in just his own part of goods to company, enter once; viz.

Goods in company Dr to Sundries, viz.
To Goods proper, for value of your share,
To each Partner his accounts in company, for value of their shares.

Note 1. This is shorter than to enter as if the goods were bought, though that way would also be right, and prove the same in effect.

Note 2. Enter also as above, if the partners give in each his own part in money, with which you buy goods; or, which is the same thing, if upon buying of the goods each partner instantly pay down his part of the price, only Cash, and not Goods proper, will be Cr for your own part. Off. 22.

Note 3. But if you instantly book the money received from the partners, enter Cash Dr to Sundries, viz. to each partner's account in company. And when you buy the goods, charge Goods in company Dr to Cash, for their value; and there is no second entry.

Case 2. If you or partner pay charges on goods brought into company, as carriage, insurance, &c. this augments the cost, and must be entered as the cost, namely, 1st, Goods in company Dr

To Cash, if paid by you. Off. 25. Nov. 1.

To Partner, his account proper, if paid by him.

2dly, Each partner his account proper Dr to ditto his account in company, for his share of the said charges.

Prob. 2. T. Debtor and Creditor applied, when goods in company are disposed of.

Case 1. If goods in company are sold, (which is either to you the trustee, or to a partner, or to a neutral person,) a double entry is necessary; viz. 1st,

Goods proper, if sold to yourself, }
Partner's account proper, if to him on time, } Dr
Cash, or Buyer, if to a neutral person, }

To Goods in company, for their value in the sale.
2dly, Each partner his account in company Dr to ditto his account proper, for his share of the sale. Off. 29. Nov. 1. and 30. Dec. 2. 18. and 28.

Note 1. The entries are the same when you receive freight for a ship in company. Off. 25. Dec. 27.

Note 2. When you receive payment for goods in company formerly sold to a neutral person, charge Cash Dr to the Buyer; and there is no second entry. Nov. 1. Dec. 13. But if you allow discount or abatement to the buyer, a double entry is necessary; namely, 1st, Sundries (viz. Cash, for the sum received, and Goods in company, for the sum discounted or abated) Drs to the Buyer; 2dly, Each partner's account proper Dr to ditto his account in company, for his part of the discount or abatement. Dec. 20.

Note 3. If goods in company be damaged, destroyed, or lost, enter Sundries (viz. each partner's account proper, for their respective shares of the damage or loss, and Freight and Lash, for your own share) Drs to Goods in company.

Case 2. If goods in company are disposed of in barter, for other goods of the same value brought into it, charge Goods in company received Dr to Goods in company delivered; and there is no second entry. Dec. 7.

Note 1. If the goods to be received and delivered be of different values, a double entry will be necessary: As, suppose a trustee engaged in company with A. B. each $\backslash frac\{1\}\{2\}$, should deliver 80 l. worth of broad cloth, in company, for tobacco to the value of 100 l.; in this case he enters twice: 1st, Tobacco in company Dr to Sundries, viz. to Broad cloth in company, 80 l. and to Cash, or Dealer, 20 l.; 2dly, A. B. his account proper Dr to ditto his account in company, 10 l. for his share of the money now laid out or due to Dealer. Again, invert the supposition, and admit, that he delivers broad cloth in company to the value of 100 l. and receives 80 l. worth of tobacco, the rest in money, or due by his dealer; in this case he enters also twice: 1st, Sundries (viz. Tobacco in company, 80 l. and Cash, or Dealer, 20 l.) Drs to Broad cloth in company; 2dly, A. B. his account in company Dr to ditto his account proper, 10 l. his part of money received, or due by Dealer.

Note 2. If you barter goods in company, for others which you take to yourself, enter also twice: 1st, Goods proper received Dr to Goods in company delivered; 2dly, Each partner's account in company Dr to ditto his account proper, for his part of sale. In like manner, if you barter goods of your own, for others which you bring into company, enter twice: viz. 1st, Goods in company received Dr to Goods proper delivered; 2dly, Each partner's account proper Dr to ditto his account in company, for his part of purchase.

Case 3. If you or partner withdraw just your or his exact part of goods in company remaining unfold, enter once, viz.

Goods proper, if withdrawn by you, } Dr
Partner's account in company, if by him, }

To Goods in company, for their value in company.
Dec. 24.

Note

Note 1. If you or partner withdraw more or less than your or his exact part, you must account the goods sold, and enter as in Case 1.

Note 2. When goods in company are all sold, or part sold, and the rest withdrawn, so that all are disposed of, make a double Journal entry viz. 1st, Goods in company Dr to Sundries, viz. to Cash, or charges or overhead, for any charges not yet booked, such as cellar-rent, &c. and to Profit and Loss for your own commission, or for interest of money advanced by you, viz. Each partner his account-proper Dr to ditto his account in company, for his part of the whole. Note 1.

N. B. This is also to be done, if it be a voyage in company.

Prob. 3. U. Debtor and Creditor applied in payments between trustee and partners.

Case 1. If you the trustee receive payment of partner in money, charge Cash Dr to partner his account-proper, for the sum received. Oct. 27. Nov. 25.

2. If partner give you his bill on E. F. charge Cash, or Bills receivable, or E. F. Dr to partner his account-proper, for value of the bill.

3. If you draw on partner, charge Cash, or E. F. viz. the man you deliver the bill to, Dr to partner his account-proper, for value of the bill.

4. If you pay partner in money, charge partner his account-proper Dr to Cash, for the sum paid. Nov. 4. and 17.

5. If you give partner your bill on E. F. charge partner his account-proper Dr to E. F. for value of the bill.

6. If partner draw on you, charge partner his account-proper Dr to Cash, if you pay at sight; if not, to Bills payable.

7. If, in adjusting shares in company, one partner pay into another, charge partner receiver his account-proper Dr to partner payer his account-proper, for the sum. Nov. 27. and 25.

N. B. The entry is the same, if you draw a bill upon one partner payable to another.

8. If partner make payment to E. F. of a debt due by the company, charge E. F. Dr to partner his account-proper. Nov. 25.

Prob. 4. V. Debtor and Creditor applied, when the company send goods to sea.

Case 1. If the goods sent to sea have been formerly brought into company, and stand already entered in the books, upon shipping them off make a double entry; 1st, Voyage in company to ——— Dr to Sundries, viz.

To Goods in company, for their value,

To Cash, for charges, as custom, insurance, &c.

2dly, Each partner his account-proper Dr to ditto his account in company, for his share of charges only.

Note. If partner pay the charges, the Voyage is charged Dr, not to Cash, but to partner his account-proper.

Case 2. If the goods sent to sea are presently bought, (which is either from you, from a partner, or from a neutral person), enter also twice; namely, 1st,

Voyage in company to ——— Dr to Sundries, viz.

To Goods-proper, if bought of you,

To Partner his account-proper, if of a partner,

To Cash, or Seller, if of a neutral person;

And

To Cash, for charges, if paid by you,

To Partner his account-proper, if by him.

2dly, Each partner his account-proper Dr to ditto his account in company, for his part of the whole.

Note 1. If each partner find just his own part of goods sent to sea, you may enter thus: 1st, Voyage in company to ——— Dr to Sundries, viz. To Goods-proper, for your share; to each partner his account in company, for their respective

two shares; and to Cash, for charges, if paid by you, or to partner his account-proper, if paid by him. 2dly, Each partner his account-proper Dr to ditto his account in company, for his part of charges.

Note 2. But if each partner bring in such goods as they have proper for the intended voyage, without regard to their just proportions, being resolved to adjust that matter with money, the best way is, to consider the goods as bought, and enter accordingly; viz. 1st,

Voyage in company to ——— Dr to Sundries, viz.

To each partner his account-proper, for value of the goods brought in by them,

To Goods-proper, for value of these given in by you:

And,

To Cash, for charges, if paid by you,

To partner his account-proper, if by him. 2dly, Each partner his account-proper Dr to ditto his account in company, for their respective shares of the cargo and charges, and not for the value of the goods given in by them. Note 15.

Case 3. If you or partner commission your or his factor, to ship off goods to company's factor; upon receiving the invoice, enter twice; 1st,

Voyage in company to ——— Dr

To Factor my account-current, if commissioned

by you.

To Partner his account-proper, if by him.

2dly, Each partner his account-proper Dr to ditto his account in company, for his part of the whole.

Prob. 5. X. Debtor and Creditor applied, upon advice from company's factor.

Case 1. If you receive per advice from factor the account of sales, enter twice; viz. 1st, Factor our account-current Dr to Voyage in company, for the amount of neat proceeds. 2dly, Each partner his account in company Dr to ditto his account-proper, for his share of the whole.

Case 2. If factor in Jamaica advise you, that because he could not dispose of the goods to advantage, he has, according to orders, shipped them off to your factor at Carolina, enter twice; namely, 1st, Voyage in company to Carolina Dr to Sundries, viz. to Voyage in company to Jamaica, for value of the cargo outward, and to Factor at Jamaica our account-current, for new charges paid by him. 2dly, Each partner his account-proper, Dr to ditto his account in company, for his share of new charges.

Case 3. If the cargo outward be lost at sea, there are three varieties. 1. If none of the goods be insured, enter Sundries (viz. each partner his account in company, for his part of the loss, and Profit and Loss, for your own part) Drs to Voyage in company; and no second entry.

2. If the goods be all insured, enter twice; viz. 1st, Charge the Insurers, or Cash if you get present payment, Dr to Voyage in company. 2dly, Charge each partner his account in company Dr to ditto his account-proper, for his share of the sum received from, or due by the Insurers.

3. If only part of the goods be insured, enter also twice; 1st, Sundries (viz. Insurers, or Cash, for the value insured; each partner his account in company, for his share of the loss; and Profit and Loss, for your own share) Drs to Voyage in company. 2dly, Each partner his account in company Dr to ditto his account-proper, for his share of the sum received from, or due by the insurers.

Prob. 6. Y. Debtor and Creditor applied, when returns are made by factor.

Case 1. If you receive returns in goods, enter twice; namely, 1st, Goods in company received Dr to Sundries, viz. to Factor our account-current, or to Voyage in company.

pany, if not yet discharged, for value of goods; and to Cash, for charges here, if paid by you, or to partner his account proper, if by him). 2dly, Each partner his account proper Dr to ditto his account in company, for his share of said charges.

Case 2. If you have return in bills, enter once; namely, Cash, if remitted to you, and paid at sight, }
Bills receivable, if remitted to you at usance, } Dr
Partner his account proper, if remitted to him, }

To Factor our account current, for value of the bill.

Case 3. If you or partner remit a bill to the factor, enter once, viz. Factor our account current Dr
To Cash, or the Drawer, if remitted by you, } for value
To Partner his account proper, if by him, } of the bill.

Prob. 7. Z. Debtor and Creditor applied in admitting a new partner.

THE entries to be made in admitting a new partner not being reducible to distinct cases, we shall explain the matter by a particular example. Suppose then yourself, as trustee, already in company with one partner A. each one half, for 300 l. and that you agree with B. to admit him as a third partner, upon his paying in 100 l. as his $\backslash frac\{1\}\{3\}$ share of stock; upon this supposition, the entries to be made are as follows.

1st, You may either let the account of Goods in company stand as it is, till the goods are sold, or balance it, by charging Goods in company with A. and B. Dr to Goods in company with A.

2dly, Charge A. his account in company Dr to ditto his account proper, 50 l. for his one half of the sale to B.

2dly, If B. presently pay in his share of stock, there are three varieties. 1st, If he pay the whole to you, charge Cash Dr to B. his account in company, 100 l. 2dly, If he pay the whole to A. charge A. his account proper Dr to B. his account in company, 100 l. 3dly, If he pay one half to you, and the other to A. charge Sundries (viz. Cash, 50 l. paid in to you, and A. his account proper, 50 l. paid to him) Drs to B. his account in company.

4thly, If B. do not pay in his share of stock presently, then charge B. his account proper Dr to ditto his account in company, 100 l.; and when he pays, discharge his account proper, as above.

III. Of the LEDGER.

THE Ledger is the principal book, wherein all the several articles of each particular account, that lie scattered in the other books according to their dates, are collected and placed together, in spaces allotted for them, in such manner, that the opposite parts of every account are set directly fronting one another, on opposite sides of the same folio.

The Ledger is the chief or principal book of accounts, as being that which immediately answers the end of book-keeping. For, as has been already observed, the Journal is only preparatory or introductory to the Ledger; and the Waste-book contains only the matter of accounts, without either the form or order; whereas the Ledger has all the perfection of form and order aimed at in book-keeping, affording a ready answer to all the demands of

the inquisitive merchant; and is therefore justly esteemed the principal book of the three. It is called the Ledger, (an Italian word that signifies art or dexterity), because in it the artificial part of book-keeping chiefly appears. The Ledger, in opposition to the scattered order of things in the Waste-book, has all the particular articles of each account collected and placed together; and that in such a manner, as to have the opposite articles separated, and set fronting one another on opposite sides of the same folio. Thus, the opposite articles of the Cash-account are, the sums of money received, and the sums laid out; which accordingly stand, the former on the Dr side, and the latter on the Cr side of the same folio. Again, in an account of goods, the prime cost and charges go to the Dr side, and the sales to the Cr side; by comparing of which, appears the gain or loss: and so in other accounts.

The Ledger folios are divided into spaces, for containing the accounts; on the head of which are written the titles of the accounts, marked Dr on the left-hand page, and Cr on the right: Below which stand the articles, with the word To prefixed to the Dr side, and the word By on the Cr side. Upon the margin are recorded the dates of the articles, in columns allotted for that purpose. The money-columns are the same as in the other books. Before them stands the folio-column, which contains figures directing to the folio where the correspondent Ledger-entry of each article is made; for every thing is twice entered in the Ledger, viz. on the Dr side of one account, and again upon the Cr side of some other account; so that these figures mutually refer from the one to the other, and are of use in examining the Ledger.

For the ready finding any account in the Ledger, it has an alphabet, or index, wherein are written the titles of all accounts, with the number of the folios where they stand.

Note. If the Ledger-accounts be numbered, 1, 2, 3, &c. according to their order; these numbers may be inserted in the Folio-column and Index, and used instead of the folio figures. We have numbered the accounts of the following Ledger, but have not made this use of them; our design being only to refer, by means of them, to the Ledger-accounts as occasion requires.

How the Ledger is filled up from the Journal.

To transport immediately from the Waste-book to the Ledger, would, as has been formerly observed, be a complex task, and require too great a measure of thought and attention; but the former being first reduced to a Journal, the transferring from it to the Ledger becomes easy, and may be performed by the following

R U L E S.

1. Turn to the Index, and see whether the debtor of the Journal post to be transported be written there: If it be not, insert it under its proper letter, with the number of the folio to which it is to be carried.

2. Upon the folio, and in the head of the space allotted for the account, write the title in a large text letter-
for

for ornament, making it Dr on the left side of the folio, and Cr on the right.

3. Record the date in the columns on the margin of the Dr side, and write the Cr with the word To prefixed to it, immediately below the title, or other articles formerly posted; and complete the entry in one line, by giving a short hint of the nature and terms of the transaction, carrying the sum to the money-columns; and insert the quantity, if it be an account of goods, &c. in the inner columns, and the referring figure in the folio-column.

4. Turn next to the creditor of the Journal post, and proceed in the same manner with it, both in the Index and Ledger; with this difference only, that the entry is to be made upon the Cr side, and the word By prefixed to it.

5. The post being thus entered in the Ledger, return to the Journal, and, on the margin, mark the folios of the accounts, writing the folio of the Dr above, and the folio of the Cr below, a small line drawn between them, thus, 4. These marginal numbers in the Journal are a kind of index to the Ledger, and are of use in examining the books, and on other occasions.

6. In opening the accounts in the Ledger, follow the order of the Journal; that is, beginning with the first Journal post, allow the first space in the Ledger for the Dr of it, the next for the Cr, the third for the Dr of the following post, if it be not the same with some of those already opened; and so on till the whole Journal be transported.

The above six rules are formed for simple posts, where there is but one Dr and one Cr; but may easily be applied to complex ones: e. g. In posts where only one of the terms is complex, the simple term is entered Dr to, or Cr by Sundries, or Sundry-accounts, referring to the Journal for particulars. And the single Drs or Crs of the complex term, are each of them, in their respective accounts, entered Dr to, or Cr by the simple term. Again, in posts where both terms are complex, each particular Dr and Cr are entered Dr to, or Cr by, Sundry accounts, with a reference to the Journal, as before. And here observe, that an article of Sundry-accounts has no referring figure in the folio-column, because it refers to several accounts: But this defect is supplied by the marginal numbers of the Journal, which must still be consulted before the particulars of the indefinite article can be known.

How to transpose an account from one folio to another.

WHEN the space allotted for an account proves too little; that is, when either the Dr or Cr side, or both, are so charged and filled with articles, that they can hold no more; the account must be transposed to a new space: Which may be done by one or other of the methods following.

1. In all accounts that have inner columns for the quantities, such as Accompt of goods, &c. add up both

the Dr and Cr sides, and charge the new account Dr to the old, for the total of the Dr side; and make the old account Dr to the new, for the total of the Cr side. Thus the old account will be evened; that is, the sums and quantities on both sides will be equal; and the new account will exhibit the same sums and quantities on its Dr and Cr sides, that the old did, before it was transposed.

2. In accounts that have no inner columns, such as Personal accounts, Cash-accounts, Profit and Loss, &c. where the difference betwixt the two sides is only considered, it is sufficient, after adding up both sides, as before, to carry the balance or difference only to the new account, by making it Dr to the old, for the said balance, if the Dr side of the old be heaviest; but if the Cr side be heaviest, then charge the old account Dr to the new. See No 1. and 61.

Note. The number of the folio on which the new account is opened, must be inserted in the Index, and also in the folio-column of the old account; and again, the folio-number of the old must be written in the folio-column of the new; that the accountant may readily turn from the one to the other, as occasion requires.

How the Books are examined.

AN accountant should be at all imaginable pains in filling up the books, to make them exact and correct: But as errors must happen, the examination of the books after they are written up becomes absolutely necessary.

1. The Walle-book being the first and fundamental book, the only means left for discovering errors in it, are, a careful reading of it, and comparing it with the accountant's memory, or the Book of letters, or Letters of correspondents, Bills, Invoices, &c.; or perhaps some accident or circumstance may happen to bring things to remembrance. And this, with calling up the sums of money anew, is all that can be done.

2. In revising the Journal, compare each post with the Walle-book, to see if the sums of money be right, and whether the narrative or reason of the entry be justly expressed. Next, Consider whether the true Dr and Cr are assigned; and, after having thus narrowly examined the posts, and corrected what happens to be wrong, return to the Walle-book, and, on the margin opposite to the revised post, make a dash with the pen, thus, /, to signify that the Journal has been compared with it, and found right.

3. The Ledger is revised or examined, by comparing it with the Journal, in the manner following. Take the Journal, and, beginning with the first post, turn (as the marginal numbers direct) to the folio of the Ledger where the Dr of the said post stands, and see whether it be duly entered: And, upon finding it right, return to the Journal, and affix to the marginal number of the said Dr a dot or point, thus [.], to shew that it has been examined. Next, Turn to the folio where the Cr is posted, and, upon finding it right, or after correcting it if wrong, return to the Journal, and affix a dot to its referring figure

figure in the margin, for the same purpose as before. If there be more Drs or Crs in the post, proceed the same way with each of them. And thus go on with the next post, and after it with the third, &c. till the whole Journal and Ledger be compared.

As every thing is twice entered in the Ledger, once upon the Dr side of one account, and again upon the Cr side of some other account; it is plain, that the total sum of all the money on the Dr sides will be precisely equal to the total sum of all upon the Cr sides: And therefore the accountant, after revising the books, is next, for further satisfaction, to add up the Dr sides of the whole Ledger into one sum, and the Cr sides into another. If they agree, it is highly probable that all is right; if they differ, something is unquestionably wrong.

This addition of the Dr and Cr sides is, by merchants, called the Trial-balance; and ought to be made, not simply by taking the sum of every page, but by summing the Dr and Cr sides of every account separately, and then adding these on every page into one sum. By going to work in this manner, you lose no labour; for when you come afterwards to close the accounts, instead of adding their Dr and Cr sides anew, you take their sums from the trial-balance.

If, after the revise is made, the totals of the Dr and Cr sides agree, the accountant may, without further trial, conclude the books to be right. But if they differ, his next step is to examine the Ledger by itself. Which is done thus: Beginning with the first account, compare the first article on the Dr side with its counter-part (to which the referring figure directs), and, upon finding them right, or making them so, affix a dot to the end of the sum, or in the folio or month column of each of them, thus [.], to signify that they have been compared. Proceed in like manner with all the other articles on the Dr side, and next with those upon the Cr side; and then go on to a new account, and from it to the following, till the whole Ledger be finished. Here observe, that, in prosecuting the examination, all the dotted articles you come to are to be omitted, as having been compared already. The Ledger, being thus examined, if the corrections of the errors found bring the sums of the Dr and Cr sides to a balance, the books may now be presumed right; but if not, something is still wrong: And there is no way left to discover the mistake, but a more careful research of the books.

This revising or examination is what merchants call Pricking of the books; and should not be put off till the Ledger is filled up, but performed weekly, and in due order; that is, the Waste-book should be revised, before it be posted to the Journal; and the Journal ought to be examined, before it be transported to the Ledger; and the revising of the Ledger finished, before the balance is begun.

How Errors are corrected.

In explaining the method of correcting errors, we shall join the Waste-book and Journal together, because the manner of correcting is the same in both; and then shew the way of correcting mistakes in the Ledger.

I. Errors in the Waste-book and Journal may be reduced to six classes, and corrected as follows.

1^st, If the errors be the omission of a whole post, the way to correct or supply the defect is, to write it in a separate place by itself, with a reference to it from the place where it should have been. 2^dy, If only a word or two be wanting, they may be interlined or written upon the margin. 3^dy, If a whole post be repeated, or twice written, it is corrected by cancelling one of them; but the cancelling ought to be done in such a slight manner, that the original writing may still be legible and distinct. 4^thly, In like manner, if only a word or sentence be repeated, let one of them be slightly cancelled. 5^thly, If there be any wrong name, word, or figure, the best way is, to let the wrong name, word, or figure, stand as they are, but correct the mistake by a note on the margin or foot of the page. 6^thly, If you commit a mistake, and presently discover it in the very time of writing, the handsomest way of correcting it is, not to alter or cancel any thing, but to write the post or sentence anew, beginning with such a phrase as this, I say; as in the following example: Sold A. B. I say, Bought of A. B.

II. Errors in the Ledger are of four sorts. 1^st, When an article is entered upon a wrong account: This is to be corrected, first, by making the other side of the said account Dr to, or Cr by Error, for the sum of the said article; which rectifies this account: After which, the article must be entered in due form, in the account to which it belongs; or rather make the correction thus, viz. charge the one account Dr to the other, for so much per error. By either of these methods, the error is removed, and the purity of the books restored. 2^dy, When an article is entered in the right account, but upon the wrong side; that is, upon the Dr side, when it should have been upon the Cr side, or vice versa; to correct this, the first thing to be done is, to remove the error, by making the other side of the said account Dr to, or Cr by Error, for the sum of the article: After which, the article must be entered anew upon the right side, as if no such blunder had happened. 3^dy, When there is an error in a sum of money: This, if it be too little, is corrected by a new charge on the same side, for the defect; and if it be too much, the mistake is rectified by a discharge on the opposite side for the excess, viz. the account is debited or credited to, or by ditto person, or ditto goods, for so much short-posted, or overcharged. 4^thly, When an article is quite forgot, or neglected, errors of this nature are easily adjusted, viz. by making the entry omitted; only observe, that it is not to be crowded in betwixt two former entries, in order to make it possess the place it would have done, had it come regularly in; for though the order, whatever it be, can occasion no error in the issue, yet this interlining would look more confused and irregular than the disorder of the date, which any person skilled in book-keeping will easily perceive to have happened through mistake.

Of balancing the Ledger, and raising from it an Inventory, to begin a new Set of Books.

MERCHANTS commonly once a-year balance or close their Ledger, and raise from it the materials of an Inventory to a new set of books, for the ensuing year.

Now,

Now, to make the method of doing this plain and intelligible to a learner, it must be observed, that, by the word Balance, merchants understand the difference betwixt the sums on the Dr and Cr sides of any account. Which difference being entered on the defective side, the account is said to be balanced; that is, to have the sums of the Dr and Cr sides evened, or made equal. And the sides of the several accounts throughout the Ledger being thus evened, and the total sums formally set down on the foot of the accounts, the Ledger is said to be balanced, closed, or finished. Again, in order to understand how the new Inventory is formed from the old Ledger, it must be observed, that these balances or differences of the sides of accounts, are of different kinds. In some accounts, the balance is, the gain or loss made upon the sale of goods; in some, the balance is, the price of goods remaining unfolded; and in others, it is a debt due to, or by the merchant, &c. Now, balances of the first kind, viz. of gain or loss, must be distinguished from the rest, and carried to the Profit and Loss account; which being done, the balance or difference of its sides, will be the gain or loss made upon one year's trade, and goes to the Stock-account. All the other kinds of balances must be brought together into one space or folio, under the title of Balance-account, and are the very articles of which the Inventory is made up. The most natural method of balancing the Ledger is, first to point out what is contained upon the Dr and Cr sides of each account, and consequently what the balances are; and then, to shew the mercantile and approved way of going to work, in closing the Ledger, collecting the balances, and converting them into a new Inventory. This we shall do in the form of problems.

P R O B. I.

What the Balances in the Accounts of proper Trade are.

§ 1. What the Balances in proper domestic Trade are.

1. Cash-account, N^o 1. and 61.

CONTAINS, upon the Dr side, the ready money which the merchant had at first, or when the books were begun; together with all he has received since that time. The Cr side contains all the payments he has made, or the money he has given out. So that the difference of the two sides is, the ready money he has by him; and therefore this account is closed, by being credited by Balance, for the said difference.

2. An Account of Goods, N^o 2. 3. 11. 12. 14. 18. 20. 21. 27. &c.

CONTAINS upon the Dr side, the prime cost and charges; and, upon the Cr side, the sale or disposal of them. So that there are here three varieties. 1. When the goods are all disposed of, which is known by the inner columns being equal, the difference of its sides is, the gain or loss made upon the sale; and so is closed, by charging it Dr to Profit and Loss, for the gain, if the Cr side be heaviest; or giving it credit by Profit and

Loss, for the loss, if the Dr side be heaviest. N^o 2. 11. 14. 18. &c. 2. When none of the goods are disposed of, which will appear by the Cr side being empty, then it is closed by Balance, for the whole sum on the Dr side. N^o 21. 27. &c. 3. When only part of the goods are disposed of, which will appear by the inequality of the quantity-columns; this case requires commonly two closing entries, viz. First, the account must be credited by Balance, for the goods remaining, valued at the prime cost; which equals the inner columns: After this, if the money-columns be unequal, it must be made Dr to, or Cr by Profit and Loss, for the gain or loss made upon what are sold; which evens the outer columns, and closes the accounts. N^o 3. 12.

Note 1. If the goods are of different kinds or prices, as they should be distinguished, when posted to the Ledger, by different numbers, or separate inner columns; so care must be taken, in balancing the account, to mention the kind of goods remaining unfolded, and to value them at their own prices.

Note 2. A merchant may, at any time, know what goods he has on hand, by comparing the inner columns of the Accounts of Goods, without being put to the trouble of inspecting his warehouse, and weighing or measuring the goods themselves.

Note 3. If there be inlack or outcome of goods, that is, defect or excess in weight or measure, it will happen, when the goods are all disposed of, that the inner columns will not be equal. In this case, the balance or equality must be restored, by inserting as much in the deficient column as will make it equal to the other, writing the words Inlack, Broke, Lost in weight, Ullaged, Outcome, or the like, before it, as the reason why it is added: but nothing goes to the money-columns.

3. Plate and Jewels.

This account contains, on the Dr side, the things of that kind you are possessed of; and, like an account of goods remaining on hand, is closed, by being credited by Balance.

4. Personal accounts, N^o 5. 6. 7. 9. 10. 13. 15. &c.

CONTAINS, upon the Dr side, the debts due by the person to the merchant, with the payments made upon any other score by the merchant to him. The Cr side contains the payments made by the person to the merchant, with the debts due by the merchant to the said person, upon any other dealings. So that there are here two cases. 1^st, If the Dr side be heaviest, the difference is a debt due by the person to the merchant. N^o 13. 24. &c. 2^dly, If the Cr side be heaviest, the difference is a debt due by the merchant to the person. N^o 15. 57. And in both cases the account is closed, by making it Dr to, or Cr by Balance, for the difference of its sides.

5. Bills receivable, N^o 25.

This is a general personal account, and contains upon the Dr side, bills accepted, and payable to the merchant. The Cr side contains the payments he has received. So that the difference of its sides (if there be any) is, what is yet unpaid: And the account is closed, by giving it credit by Balance, for the said difference.

6. Bills

This is an account of the same nature with the former; and contains, upon the Cr side, the bills accepted by the merchant, payable to others; and, upon the Dr side, the payments he has made. So that the difference of the sides (if there be any) is the bills yet unpaid: And the account is closed, by charging it Dr to Balance.

This account exhibits, on the Cr side, all the bills you draw on your factors or correspondents; and the Dr side shows what of them are accepted, protested, or yet outstanding; and is closed, if the sides happen to be unequal, by being debited to Balance, for the bills outstanding, viz. the bills of whose acceptance you have hitherto had no advice.

This account exhibits, on the Dr side, all the bonds you have received, and on the Cr side, what of them are paid, or outstanding; and is closed, if the sides happen to be unequal, by being credited by Balance, for the bonds yet unpaid.

Contains, upon the Dr side, the goods sent off; and upon the Cr side, either the same goods returned, or advice from your correspondent that he designs to keep them, or the price sent up. So that either the sides of this account are equal, and then the account closes of itself; or, if there be any difference, it is owing to your having hitherto had no advice concerning some of the goods sent off; and in this case the account is closed, by being credited by Balance, for the said difference.

Contains, upon the Dr side, the value at which the several pieces are received; and on the Cr side, the value at which they are put off. In closing this account, there are three cases. 1^st, If the pieces are all disposed of, the account is closed, by being debited or credited to or by Profit or loss, for the gain or loss made by them. 2^dy, If none of the pieces are yet disposed of, it is closed by being credited by Balance, for the whole value on the Dr side. 3^dy, If part of them are disposed of, and part of them yet on hand; in this case, the account must first be credited by Balance, for value of the pieces on hand; and if after this the money-columns still remain unequal, it must be debited or credited to or by Profit and Loss, for the said difference; which is the gain or loss made upon the pieces disposed of.

Contains, upon the Dr side, the consignments made when the wagers were entered into. The Cr side contains the decisions of the wagers. So that here occur two varieties, viz. 1^st, If all the wagers are determined, the difference of the sides will be the gain made upon those decided in favour of the merchant; and the account is closed, by being charged Dr to Profit and Loss, for the said difference. 2^dy, If any of the wagers are yet undecided, the account must first be credited by Balance for them: After which, if the sides are still un-

equal, it must be charged Dr to Profit and Loss, for the difference.

The Dr side of this account exhibits the legacies, bills, or debts, you the executor have paid on account of the person deceased; and the Cr side shows what he died possessed of: And the account is closed, by being made Dr to Profit and Loss, for the difference of its sides; which is the sum that falls to you the executor.

Contains, upon the Dr side, what they cost at first, or are valued at, with all charges, such as repairs, or other expenses laid out upon them. The Cr side contains, (if any thing be writ upon it), either what they are sold or exchanged for, or the profits arising from them; such as freight, rent, &c. Here there are three cases. 1^st, If nothing be written upon the Cr side, it is closed, by being credited by Balance. 2^dy, If the Cr side be filled up, with the price of the ship, house, &c. sold, or otherwise disposed of, then the difference of the sides is the gain or loss made upon the sale; and the account is closed, by being debited or credited to or by Profit and Loss. 3^dy, If the Cr side contain only the freight or rent; in this case, first charge the ship, house, &c. Dr to Profit and Loss, for the freight or rent; and then close the account with Balance. N° 4.

Contains, upon their Dr sides, the articles of loss, and upon the Cr sides the articles of gain; and are closed, by being debited or credited to or by Profit and Loss, for the difference of their sides.

Contains, upon the Dr side, the articles of loss, and on the Cr side the articles of gain. To this account are carried, not only whatever comes in course to it from the Journal, but also all the articles of gain and loss that occur in closing the Ledger-accounts. After which, the Dr and Cr sides being added up, their difference is the neat gain or loss made since the books were begun; and therefore this account is closed, by being debited or credited to or by Stock, for the difference of its sides.

As gathered from the Journal, contains, upon the Dr side, the debts due by the merchant when the books were begun. The Cr side contains his ready money, effects, and debts due to him at the same time. But then, to this account, as it now stands, there is brought, at closing of the Ledger, the difference of the sides of the Profit and Loss account. After which, the Dr and Cr sides being added up, and compared, their difference will be the merchant's present neat stock; and the account is closed by Balance.

Contains, upon the Dr side, the prime cost and charges of the cargo. The Cr side is either empty, or it contains the receipt or disposal of the goods by the factor, or perhaps returns made for them. There are therefore here two cases. 1^st, If the Cr side be empty, the ship is still at sea, or, at least, there has been as yet no advice of her arrival; and the account is closed, by giving it credit by Balance. 2^dy, If the Cr side be filled up, the difference of the sides is the gain or loss made upon the voyage; and accordingly the account is closed by being made Dr or Cr to or by Profit and Loss. If the sums of the sides happen to be equal, there is neither gain nor loss on the voyage; and the account closes of itself.

Contains, upon the Dr side, the goods consigned to, and received by the factor; and on the Cr side, the disposal of the said goods. This account balances exactly as an Account of goods in proper domestic trade.

Contains, upon the Dr side, the debts due to the factor, for my goods sold by him on time. The Cr side contains the payments made by debtors to the factors. So that, if there be any difference of the sides, it is the debts yet out-standing: And the account is closed, by giving it credit by Balance.

Contains, upon the Dr side, the money in the factor's hands, received by him of the sales of my goods, with the remittances I had sent him, or payments I have made him upon any other account. The Cr side contains the payments or remittances he has sent me, with the debts I owe him upon any other score. In closing this account, there are two cases. 1^st, If the inner columns, which contain the foreign money, be equal; then, if there be any difference between the outer columns, it is the gain or loss made by exchange; which flows from the different rates of exchange at which these debts have been charged and discharged: And the account in this case is closed, by being made Dr to or Cr by Profit and Loss, for the difference of the outer columns. 2^dy, If the inner columns are unequal, they must first be brought to an equality, by making the account Dr to, or Cr by Balance, for their difference, valuing the foreign money at the current rate of exchange; which difference is a debt due by the factor if the Dr side be heaviest, but due to the factor if the Cr side be heaviest. If after this the outer columns are unequal, their difference is, the gain or loss made by exchange; and the account must be closed, by making it Dr to or Cr by Profit and Loss, for the said difference.

This account contains, upon the Dr side, the charges paid by the factor. The Cr side contains the sale or disposal of the goods. In closing this account, there are five varieties. 1^st, If the goods are all sold, and all the money received, this account is balanced, by being charged Dr. first to Profit and Loss, for the factor's commission, at so much per cent. after which, the difference of the sides is, the money due to the employer; and is closed, by being again charged Dr to A. B. his Account-current, for the said difference. 2^dy, If the goods are all sold, but no money yet received, it is closed, by being made Dr to Profit and Loss, for the factor's commission, and to A. B. his Account on Time, for the out-standing debts due to him. 3^dy, If the goods are all sold, and only part of the money received, it is closed, by being made Dr to Profit and Loss, for the factor's commission; to A. B. his Account on Time, for the out-standing debts; and to A. B. his Account-current, for the employer's money in factor's hands. 4^thly, If none of the goods be yet sold, it is closed, by giving it credit by Balance, for the sum of the charges on the Dr side. 5^thly, If only part of the goods are sold, and so the account unfinished, the best way to close it is, by a double balance; that is, first charge it Dr to Balance, for the sum upon the Cr side; and then give it credit by Balance, for the charges on the Dr side. Thus the account will appear in the new books in the same state that it did in the old.

Contains, upon the Cr side, the debts due by those who bought the employer's goods; and as these debts are paid in to the factor, it is charged Dr to A. B. his Account-current, for the said payments; and therefore, if, at closing of the Ledger, there be any difference of its sides, it is the debts yet out-standing; and is closed, by being charged Dr to Balance, for the said difference.

Contains, upon the Dr side, the money laid out by the factor for the employer's use, as in answering his bills, or remitting bills to him, or otherwise. The Cr side contains the money in the factor's hands belonging to the employer. So that the difference of its sides is, the debts due by the factor to A. B. or by A. B. to him; and the account is closed, by being made Dr or Cr to or by Balance.

Note, If the factor dispose of the employer's good on trust, to persons with whom he has private dealings of his own, it will be proper, in closing their accounts, to divide the balance into two parts, viz. one due for the employer's goods, and the other due to or by himself.

What the Balances in Company-accounts are.

§ 1. What the Balances in the Accounts kept by a Partner are.

1. A. B. my Account in Company, N° 54.

CONTAINS, upon the Dr side, the partner's inputs, and share of charges; upon the Cr side, the returns made; and the difference is the gain or loss. In balancing this account, there are two cases. 1st, If the account be finished, i. e. if the goods be sold, and returns made, it is closed, by being made Dr or Cr to or by Profit and Loss. 2dly, If the account be yet unfinished, the best way is, to close it with a double balance; that is, to make it Dr to Balance, for the sum of the Cr side, and give it credit by Balance, for the sum of the Dr side.

2. A. B. my Account-proper, N° 55.

This account is merely personal, and closed with Balance, for the difference of its sides; which is the debt due to, or by the company.

§ 2. What the Balances of the Accounts kept by a Trustee in his own Books are.

BEFORE the trustee close the company's accounts, he ought to make the double Journal entry following, if it be not done already; namely, 1st, Goods in Company, or Voyage, &c. Dr to Sundries, viz. to Cash, for all charges not yet stated to account, such as cellar-rent, &c. and to Profit and Loss, for his own commission, at so much per cent. 2dly, Each partner's Account-proper Dr to his Account in Company, for their respective shares of the above charges and commission. These entries being made, the balances of the accounts are as follows.

1. Goods in Company, N° 58. 62. 71. 74.

CONTAINS, upon the Dr side, the prime cost of the goods stocked in, with all charges, and the trustee's commission. The Cr side contains the disposal of them. The difference of the sides is gain or loss, to be divided amongst the partners. Here there are three cases. 1st, If the goods be all sold, the account is closed, by being debited or credited to or by Sundries, viz. to, or by each partner's Account in company, for their shares of the gain or loss; and to, or by Profit and Loss, for the trustee's own share. 2dly, If none of the goods are sold, then the account is closed, by being credited by Sundries; viz. by each partner's Account in Company, for their shares of the goods unsold; and by Balance, for the trustee's share. 3dly, If part of the goods are sold, and part of them yet remain not disposed of, this case is a compound of the two former; and accordingly the account is closed, by making the entry mentioned in the first case, for the gain or loss on those sold; and then, by making the entry mentioned in the second case, for those not disposed of.

2. Voyage in Company, N° 66.

CONTAINS, upon the Dr side, the value and charges of the goods sent to sea. The Cr side contains the receipt or disposal of them by the factor. The difference of the sides is gain or loss. Here there are three cases. 1st, If the Dr and Cr sides be equal, then the account closes of itself. 2dly, If one of the sides exceed the other, then the account is closed, by being made Dr or Cr to or by Sundries; viz. to, or by each partner's Account in Company, for their shares of the gain or loss; and to, or by Profit and Loss, for the trustee's share. 3dly, If nothing be yet writ upon the Cr side, then the account is closed, by being credited by Sundries, viz. by each partner's Account in Company, for their shares of the goods at sea; and by Balance, for the trustee's share.

3. Factor our Account of Goods.

CONTAINS, upon the Dr side, the company's goods consigned to, and received by the factor. The Cr side contains the disposal of them. The difference of the sides is gain or loss made upon the sale of them. This account has the same varieties, and is balanced the same way with Goods in company.

4. Factor our Account-current.

CONTAINS, upon the Dr side, what money belonging to the company is in the factor's hand. The Cr side contains the returns he has made in goods or bills. The difference is the debt due to or by the factor. This account is closed, by being made Dr or Cr to or by Balance, for the said difference.

5. Partner his Account in Company, N° 59. 69. 70.

CONTAINS, upon the Cr side, the partner's inputs, with his share of charges, and of gain at close. The Dr side contains returns for inputs disposed of, or goods remaining unsold, with the partner's share of losses, if any. This account, after the preceding accounts are balanced, will always close of itself; as is evident by considering what goes to the two sides of it: so that if the balance of this account fail, the accountant may conclude, for certain, that something in the company's accounts is wrong, or at least some mistake has happened in closing them.

6. Partner his Account-proper, N° 60. 67. 68.

IS a personal account, the difference of whose sides is the debt due to or by the partner, and is closed with Balance.

NOTE. If the design of balancing the company-accounts be, not in order to know the state of the company's affairs, but only that the old Ledger may be finished, and the accounts carried to new books: the accountant, in this case, may either balance them as above directed; or he may, if he pleases, close all of them by a double balance; which is the easiest and shortest way, and will have the same effect in the issue.

§ 3. What the Balances of the Accounts kept by a Trustee in separate Books are.

1. Goods in Company, and Voyage in Company,
HAVE the same things upon their Dr and Cr sides, as when

when kept in books along with other business; but are closed with Profit and Loss in Company, for the gain or loss; and with partners Accompts in company, for their respective shares of goods remaining unfold, or at sea.

2. Cash in Company.

Contains, upon the Dr side, the sums of money given in by partners, and received from dealers for goods sold; the Cr side contains the sums laid out; so that the difference of its sides is the money on hand; and is closed with Balance in company.

3. Partner his Accompt in Company.

Contains the same thing upon its Dr and Cr sides respectively, as when kept in books along with other business; and, after the accompts of goods and voyages are balanced, will always close of itself.

4. Partner his Accompt proper.

This and all personal accompts, as they contain the same things upon their Dr and Cr sides, as their parallels, in proper trade, so they are all closed with Balance in company.

5. Profit and Loss in Company.

The difference of its sides is the gain or loss made upon company-trade, and must be charged Dr to the trustee his Accompt-proper, for his commission; after which, it is closed, (if no Stock-accompt is kept), by being made Dr or Cr to or by Sundries, viz. Each partner his accompt in company, for the respective shares of gain or loss. But if you keep a Stock-accompt in company, then this accompt is closed with it; and the Stock-accompt is again closed with the partners Accompts in company.

6. Balance in Company.

Contains, upon the Dr side, the company's ready money in the trustee's hand, with the debts to the company, whether by partners or dealers; the Cr side contains the debts due by the company, and that whether to partners or to dealers: And if the books have been rightly kept, and duly balanced, the two sides of this accompt will always equal one another to a farthing.

Note. If you incline the goods remaining unfold, or at sea, should appear upon the Balance-accompt, you must close the Accompt of goods and Voyages with Balance in company, for the value of the quantity not disposed of, or at sea; and you may close the partners Accompts in company (which in this case will not close of themselves), either with their Accompts proper, or with Balance in company, as you please.

How the Balances are collected, the Ledger closed, and a new Inventory formed.

WHEN you design to balance your Ledger, in order to begin a new set of books, proceed in the manner following.

Take two sheets or folios of loose paper, rule them like the Ledger, and write on the heads or tops of them, the titles of the two following Accompts, viz. on the head of the one, Profit and Loss Dr, and Contra Cr;

on the other, Balance Dr, and Contra Cr. Then, beginning with the Accompt of cash, go over every accompt in the Ledger, (omitting only the Accompts of Profit and Loss and Stock, which must be left open to the last), and carry the articles of gain or loss found on any of them, to the Profit and Loss sheet; and the articles of debt, or goods remaining, to the Balance sheet, without touching the accompts themselves: e.g. Taking from the Trial-balance the sums of the Dr and Cr sides of the Cash-accompt, subtract the one sum from the other, and, on the Balance sheet, make Balance Dr to Cash, for their difference, being the ready money in your hands. Again, in an Accompt of goods that are all sold, taking the sums of the Dr and Cr sides, subtract the one from the other, and, on the other sheet, make Profit and Loss Dr or Cr to or by the said Accompt of Goods, for the difference of its sides. And in this manner proceed with every other accompt in the Ledger, according to their nature, as explained in the last section.

Having advanced thus far, your next step is, to add up the Dr sides of the Profit and Loss sheet, and the Profit and Loss accompt in the Ledger, into one sum, and their Cr sides into another; and, on the said sheet, make Profit and Loss Dr or Cr to or by Stock, for their difference: Which difference being carried to the Stock-accompt, add up its Dr and Cr sides, and carry their difference to the Balance sheet. Which being done, the total sums of the Dr and Cr sides of the Balance sheet will be equal to a farthing, if the books be right, and the balancing work truly performed: As may be thus demonstrated.

It is obvious, that the Balance sheet, before the balance of the Stock-accompt is brought to it, contains, upon the Dr side, the money and goods you have on hand, or at sea, or in the hands of factors, with the debts due to you; the articles on the Cr side are the debts due by you to others: So that the difference of its sides is your present worth, or neat stock. Now, if the balance of the Stock-accompt be also equal to your present neat stock, it is plain, that it will even the sides of the Balance-accompt. But that it is so, appears thus.

Your present neat stock is equal to your neat stock when the books were begun, with the addition of the gain, or diminution of the loss, made since that time: but the difference of the sides of Stock accompt, before the balance of Profit and Loss accompt be brought to it, is your neat stock when the books were begun; and the balance of Profit and Loss accompt, is the gain or loss made since that time; which, consequently, being brought to Stock-accompt, makes the balance of Stock-accompt equal to your present neat stock; and therefore the balance of Stock-accompt evens the sides of Balance-accompt.

If, after the balance of Stock-accompt is brought to Balance-accompt, the sides happen to be still unequal, there has unquestionably some error been committed; which you must find out by a careful review of the balancing work: for here the error must lie, since the books are supposed to have been examined, and found right, or made so, before the balancing was begun. On the other hand, if the sides of Balance-accompt be equal,

all may be presumed right. There is not, indeed, an absolute certainty in the case: for, if you imagine two mistakes committed, either both in the articles of Profit and Loss, or both in the articles of Balance, or one in the former, and the other in the latter, both excesses, or both defects, equal, and on opposite sides, it is plain this would not impede the equality of the Dr and Cr sides of the Balance-accout. But then this is so great a chance, that it is more than probable such a thing can never happen, and passes too, without being discovered.

Having brought the two sides of the Balance-accout to an equality, which is the test of every thing being right, proceed to close the Ledger-accouts, thus. First, to the Profit and Loss accout, transfer the articles on the Profit and Loss sheet. Next, at the end of the Ledger, erect an Accout of Balance, into which transcribe the Balance sheet. After which, return to the beginning of the Ledger, and giving the Cash-accout credit by Balance, for your ready money, draw a line across the money-columns on each side, at the foot of the accout; below which set down the total sums, which will be now equal. Proceed in like manner with all the following accouts, transferring to each the respective articles that belong to them, from the two sheets of loose paper, inserting the referring figures in the folio-column, and writing the total sums on the foot of the accout; by which means all the accouts in the Ledger will come to be balanced and closed; that is, evened and finished.

But here it will be proper to observe, that merchants,

in balancing their Ledger, do not all go the same way to work. For some, instead of proceeding according to the above directions, close their Ledger-accouts, and post the closing entries to the Accouts of Profit and Loss, and Balance, all at the same time. And it must be owned, that this way, practised with care, will well enough answer the purpose; but to post the closing entries in the first place, and then to close the accouts, seems to be the surer and better method.

The Ledger being now closed, the next thing to be done is, to begin a new set of books; in order to which, a new inventory must be fetched from your old books, as the foundation of your future trade in the new. Now, it is plain, at first view, that the several articles on the Dr side of the Balance-accout, being the particular items of your effects, and debts due to you, make up the first part of the Inventory; and the several articles on the Cr side, except the last, being the debts due by you to others, make up the second part of it: and accordingly in your new Journal, the several particulars on the Dr side must all of them be made Drs to Stock, and Stock Dr to the several particulars on the Cr side; and Stock-accout in your New Ledger will stand thus:

Stock Dr,
To Jacob Russel,
To H. V. Beck,
&c.

Contra Cr,
By Cash,
By Indian chits,
&c.

An Inventory of the money, goods, and debts belonging to me A. B. as also of the debts due by me to others, viz.

B O O K - K E E P I N G.

( 3 ) WASTE-BOOK.

WASTE-BOOK.

June 16th.
Nathaniel Napier writes me, that he designs to keep the 16 pieces of druggets sent him the 7th of May last, and promises payment, viz. the one half against the 1st of August next, and the other half at Martinmas, the whole being - - - - -

18th
Received advice from William Boyd in Jamaica, That he hath received and sold my adventure, the neat proceeds, as per account of sales, amounting to 304 l. 7s. In return for which, he hath put on board the same ship the following goods, desiring me to draw for the rest, viz. - - - - -

22d.
Settled accounts with George Dennis, and paid him in full, - - - - -

June 29th.
Paid Sir Isaac Griff in full, - - - - -

July 2d.
Paid shop-rent for half a year, viz. from January 1. to July 1. - - - - -

5th
Paid my shopkeeper his bill of postage, and other petty charges, - - - - -

9th
Ship Hopeswell is arrived safe with my goods from Jamaica; freight, duty, and other charges paid here, amount to - - - - -

Sold John Dyer my six barrels indigo upon the key, at 4s. 3 d. per lb. - - - - -

10th.
Brought into my warehouse - - - - -
My 5 hhd's pimento, containing 1535 lb. valued at 6d. per lb. } 38 07 06
And also my 5 hhd's sugar, containing 63 C. at 19 s. per C. } 59 17 00

Drawn my bill on William Boyd in Jamaica, payable to Edward Dupper, or order, for value due by ditto Dupper, at 10 days, - - - - -

22d.
J. P. No. 1. Shipped on board the Dolphin, consigned to John Perkins merchant in Hamburg, to sell for my account, the goods following, marked and numbered as per margin, viz. - - - - -

30th.
Received of Edward Dupper, in full for my bill on William Boyd, - - - - -

August 2d.
Received of Nathaniel Napier, in part for druggets, - - - - -

6th.
Lent Edward Harley upon bond, for three months, at 5 per cent. - - - - -

10th.
Received from on board the Griffin, John Temple master, the following goods, to sell for account of Herman Van Beek, merchant in Amsterdam, viz. 18 C. flax, and 14 butts madder, each butt containing 12 C. - - - - -

Paid custom, freight, wharfage, portage, &c. - - - - -

17th.
Sold Herman Van Beek's 14 butts madder, containing 168 C. at 2 l. 10 s. per C. for ready money, - - - - -

23d.
Sold to Thomas Freeman, for account of Herman Van Beek, 18 C. flax at 3 l. to pay at six M^o. - - - - -

Paid storage, brokerage, and other charges on Herman Van Beek's goods, - - - - -

My commission on 490 l. at 2¹ per cent. comes to - - - - -

( 3 )

J O U R N A L.

J O U R N A L.

( 4 )

B O O K - K E E P I N G.

( 7 ) J O U R N A L.

J O U R N A L. ( 8 )

B O O K - K E E P I N G.

( 11 ) J O U R N A L.

J O U R N A L. ( 12 )

B O O K - K E E P I N G.

(1) L E D G E R.

L E D G E R. (1)