Place the currency and the checks in the pass book and hand it to the bank. Examine the pass book to see that all is entered correctly. March 31. Give Henry T. Dale, your clerk, a check for his salary, $30. Write the check and record it. At this point the monthly bank statement should be made. If the deposits and the checks have been passed to an office, these instructions should be followed by the one in charge of that work; if not, the student may make the statement himself. Proceed as follows: Enter all deposits and all checks on the outside of the bank envelope, in which the checks have been filed from day to day. Refer to page 73 for illustrations. Total both the deposits and the checks and find the balance. Place the checks in the envelope. Total the deposits in the pass book, subtract the total checks therefrom, enter the balance, rule and foot. Bring the balance down under April 1. Before closing the books, hand them to the instructor for inspection and approval. Record the following in the journal, in the usual form, at the cost price. Close each of the following: the cashbook, the sales book, and the purchase book. Refer to pages 63 to 65. Post the books to the ledger, three accounts to the page, as follows: 1. Post the journal, writing Jin the explanatory column of the ledger. 2. Post the cashbook, writing C in the explanatory column of the ledger. 3. Post the sales book, writing S in the explanatory column of the ledger. 4. Post the purchase book, writing P in the explanatory column of the ledger. Foot the ledger accounts. Take a trial balance, using only the balance of each account. (See page 79.) Do not forget the balance of cash from the cashbook. Have the trial balance approved; record it in Blank No. 1, on the page indicated by the index. Make the two statements and the verification; after approval, record them in Blank No. 1, on the page indicated by the index. Close the ledger. Take a second trial balance. Submit all work to the instructor for approval. When the monthly statement of your bank account has been completed, compare each check with the stub in the check book; if they agree, put a large check mark on the stub. This shows that the check issued has been returned canceled. Does the balance of your monthly bank statement agree with the balance shown in your check book? Place the canceled checks in the Paid Bills envelope. EXERCISE 42 A WRITTEN REVIEW The following review exercises are suggested: a. Journalize orally or in writing each transaction in March. b. Use trial balances 1 and 2, page 28. Make the two statements, using $25 for the expense inventory in each statement. c. Use Exercise 31, I and II, pages 33 and 34 for closing the ledger. INDORSEMENTS An Indorsement is the writing of one's name on the back of commercial paper with the intent to transfer the title or to assume legal responsibility for its payment. Sometimes a payment of interest, or a partial payment of the face, is recorded on the back of an instrument. The Object of indorsement is to effect a transfer of the title, or to make the indorser conditionally liable for payment, or both. Indorsements are made by using a rubber stamp or by writing. The indorsements most commonly used are the special or full, the blank, the qualified, and the restrictive. Special Pay to the order of Blank Howard Co. Qualified Without recourse. or Pay to the order of John E. Lane, with out recourse. Howard Co. Restrictive Pay to The Union A special indorsement names the indorsee; the instrument could not again be negotiated without the indorsee's indorsement. A blank indorsement names no indorsee. Any holder may, however, convert this into a special indorsement by writing "Pay to (his name) or order" above the blank indorsement. A qualified indorsement simply passes the title without rendering the indorser liable. In form, this indorsement may be either in blank or special. A restrictive indorsement constitutes the indorsee an agent of the indorser, usually for the collection of the paper. This form of indorsement is not commended by banks and clearing houses. Note the indorsement on page 87. All commercial paper offered for deposit at a bank must be indorsed, and the special indorsement is most commonly used. This form is a protection to the lawful holder because the payee is named, and payment will be made only on his order, by indorsement. If a check or a note bearing a special indorsement is lost or stolen, it is valueless to such a holder. When one has a check cashed at the bank, the blank indorsement may be used, as the check will be canceled as soon as cashed. As the qualified indorsement relieves the indorser of responsibility for payment, commercial paper bearing this indorsement should be accepted with great caution. SET III. GRAIN AND SEED BUSINESS WORK FOR APRIL The memoranda following are a continuation of the memoranda for March. No new principles are introduced, and the familiar business forms are used. As such full and explicit instructions were given in March, much explanatory matter will be omitted in April. If anything is not understood, refer to a similar transaction in the preceding month. Directions and Suggestions. The following general directions should be observed: 1. Use the same price list, the same books, etc., as in March. 2. Begin a new page in the journal. In the sales book leave a space of three lines, then write the first sale in April under the last sale in March. 3. The balance brought down from the March cashbook, under April 1, is to be reckoned with the cash receipts in April. Use a new envelope for the bank account. Record the balance at the head of the deposit column. INCOMING BUSINESS FORMS FOR APRIL Form 15. Invoice of Henry Bruce, City, April 6. Terms: on account. Form 16. Invoice of S. D. Welch, City, April 9. Terms: on account. 200 bu. Field Corn 200 bu. Wheat 100 bu. Spring Rye Form 17. Invoice of C. V. Cronin, City, April 11. Terms: cash. 50 bu. Timothy Seed Form 18. Note of Boyd & Co., City, for $100, in your favor, at 10 da., April 14. Form 19. Check of Howard Young, City, for $145, in your favor, April 15. Form 20. Check of Boyd & Co., City, for $165, in your favor, April 23. Form 21. Check of Boyd & Co., City, for $100, in your favor, April 24. Form 22. Invoice of Smith & Bowers, City, April 25. Terms: cash. 20 bu. Dwarf Beans 200 bu. Field Corn 50 bu. Garden Corn Form 23. Check of Jesse Watson, City, for $175, in your favor, April 27. Form 24. Check of Jesse Watson, City, for $180.90, in your favor, April 28. Form 25. Check of Howard Young, City, for $90, in your favor, April 29. MEMORANDA OF TRANSACTIONS FOR APRIL April 1. Give Amos Graves your check for the rent of the store for April, $35. 1. Give Henry Bruce your check in full of account. Turn to Henry Bruce's account in the ledger and find the balance of his account; write the check for this amount. 3. Receive of Howard Young cash, in full of account, $98. Turn to Howard Young's account in the ledger and verify the balance. Write the receipt and get the money. Enter it in the cashbook. 4. The note in favor of S. D. Welch falls due to-day; pay it by check. Write the check. Pass it in and receive the canceled note. The note will be canceled by writing across the face, Paid April 4, 19—. Make the entry in the cashbook. What account is debited in the cashbook? Place the canceled note in the Paid Bills envelope. 6. Buy of Henry Bruce, City, on account, merchandise as per invoice, Form 15. Remove the invoice from the tablet and proceed as usual. 7. Sell Howard Young, City, on account, at the prices given herewith: 100 bù. Field Corn at 48¢ 50 bu. Millet at 98¢ 20 bu. Timothy Seed at $2.40 9. Give S. D. Welch your check, to apply on account, $200. 9. Buy of S. D. Welch, City, on account, merchandise as per invoice, Form 16. 10. Sell Boyd & Co., City, on account: 30 bu. Garden Corn 20 bu. Clover Seed 100 bu. Oats 11. Buy of C. V. Cronin, City, for cash, merchandise as per invoice, Form 17. Check the invoice; if it is correct, write a check in payment. 12. Sell P. H. Morse, City: 20 bu. Timothy Seed 100 bu. Field Corn 100 bu. Wheat |