In a similar way we post the accts. with Chas. Armstrong, Fred. M. Sargent, Sam'l B. Woodford and Stephen Gates.

All Dr. accts. must be entered on the Dr. side, and all Cr. accts. on the Cr. side of the ledger. Thus we have shown how the transactions of Jan. 1st were entered in the day book and posted to the Ledger.

The transactions of Jan. 2, 3, and 4 are treated in the same way. We credit in the day book the amount of our purchase of James Dole, $10.80, and of Wm. True, $27, and post to the ledger, as we did the entries of Jan. 1st. John Tyler pays, Jan. 2, cash on acct., $3.00, which we place to his credit in the day book. We charge or debit Geo. B. Lewis $3.20, for bbl. St. Louis flour, which we also post to the ledger. See page 61.

Jan. 3 we find that we paid Sam'l B. Woodford $50 on acct. (i.e. to reduce our debt to him). This am't we debit or charge him in the day book. The same date John Tyler paid the bal. of his acct. How could we tell most readily what that am't was? Turning to his ledger acct. (see page 61) we find the am't on the Dr. side is $6.25, but on the Cr. side it is only $3.00.

The difference between the $3.00 and $6.25, or $3.25, is the sum necessary to balance his acct., with which am't we credit him. This, with James Dole's acct. of $11.85, disposes of our first entries in the day book, which gives us a clear record of each day's business with the different persons, and which enables us to tell at a glance how we stand with each.

By referring to the ledger (page 61) you will see how readily the questions asked by Mr. Mason of you as his clerk, as to how he stood with James Dole and others, can be answered. The Dr. side of Dole's acct. is $11.85, the Cr. side $10.80, from which we find Dole owes us $1.05 more than we owe him.

How do we stand with Geo. B. Lewis, Sam'l B. Woodford and others? By reference to Lewis' ledger acct. we find the Cr. side is $3.36 more than the Dr. side, so we owe him $3.36 more than he owes us.

By reference to Sam'l B. Woodford's acct. we find the Dr. side is only $50, while he is credited by mdse. $127.50, i.e. we owe him $77.50 more than he owes us. By turning to the entries in the day book we can learn just what goods we had of him, and the price and quantity of each article ordered.

Thus we can readily learn just how we stand with each person whose name we have entered in our books.

There are two kinds of book-keeping, Single Entry and Double Entry.

Single Entry Book-keeping is so called because by that method a transaction is usually entered under only one acct. in the ledger.

Double Entry Book-keeping is so called because by that method every transaction is entered under two accts. in the ledger. There are other important differences between the two methods, but they need not be mentioned here. The accts. with which we have been dealing have been recorded by the single entry method.

DRILL EXERCISE, No. 26.

Now let the pupil copy on paper, or in a blank-book properly ruled as a day book, and transfer to the ledger Wm. Mason's Jan. accts. (See page 60.) Better record on practice paper first, from which transfer to the proper books; then record and post his Feb. memoranda, which are to be regarded as a continuation of Mason's Jan. accts.

In actual business, of course, the proper way is to enter in the D. B. and post transactions on the same day on which they occur.

Feb. 3. Sold Fred. M. Sargent, on , 5 lbs. butter @.28; 1 doz. eggs, .24; sold Geo. F. Hall, on %, 1 bu. corn, .72; paid Wm. True cash, on %, $12; sold John Tyler, on %, 20 lbs. gran. sugar @7; sold Geo. B. Lewis, on %, 1 gal. kerosene oil, .14, 1 lb. tea, .60; bo't of James Dole, on %, 2 bu. beans @ $2.25.

Feb. 7. Sold Wm. True, on %, 1 bbl. Queen City flour, $6.50; sold Stephen Gates, on %, 3 cakes toilet soap @ 8, 3 qts. beans @ .10; sold Chas. Armstrong, on %, 1 can peaches, .30, 3 pks. Baldwin apples @ .40.

Pd. Sam'l B. Woodford cash on %, $40.

Feb. 10. Geo. F. Hall pd. cash to bal. his % (refer to ledger to find how much was due). Sold John Tyler, on %, 1 can corn, .12, 3 lbs. butter @ .28.

Sold Henry Foster, on ", 6 lbs. codfish @ 8, 1 bu. potatoes, $1.05; bo't of Geo. B. Lewis, on

, 3 lbs. butter @.24; sold Chas. Armstrong, on , 1 bbl. St. Louis flour, $6.25; sold James Dole, on %, 2 lbs. Java coffee @ .35, 1 box salt, .20.

Feb. 11. Sold Horace P. Smith, on %, 15 lbs. gran. sugar @ 74, 2 cans corn @ .12; sold Henry Foster, on , 2 lbs. cheese @ .21, 2 bu. corn @ .72. Pd. Wm. True cash to bal. his .

Having entered these transactions in the day book, and posted them, let the pupil answer the following questions by referring to the ledger :

Suppose that we should settle in full with each person who owes us or whom we owe, should we, in all, receive more than we pay, or pay more than we receive, and how much?

We should receive payments from John Tyler, Chas. Armstrong, Fred. M. Sargent, Stephen Gates, Henry Foster and Horace P. Smith, amounting in all to $20.56. We should make payments to Geo. B. Lewis, S. W. Woodford, and James Dole, amounting to $43.39. We should pay $22.83 more than we rec'd. [If the pupil obtains the same result from his ledger, his work has

probably been correct.]

REVIEW QUESTIONS.

NOTE. Some of these questions are answered directly in the preceding pages, others indirectly, and still others test the pupil's knowledge outside of the book.

DRILL EXERCISE, No. 27.

ILLUSTRATING THE USE OF THE CASH BOOK.

The pupil must have noticed that in the accounts with which we have been dealing so far there has been no separate record of one kind of transaction which occurs in any ordinary business. Some goods are bo't or sold, and paid for at the time. If a person buys goods and pays for them at the time, he is not a debtor for them. If we buy of him and pay him at once, he is not a creditor.

It is not usual for book-keepers to place such cash transactions (i.e. cash rec'd or paid out) in the day book, except with persons who have standing accts. When one pays cash on account it is put in both the day book and cash book.

It is found to be of great convenience to keep an entirely distinct record of the cash transactions, paid or received. That is done by means of an acct. called a cash account. As this record is generally kept in a separate book, it is spoken of as the Cash Book. This record, as we shall see, is of very great importance in any business.

The memoranda which follow may be supposed to relate to the business of John D. Wilson, of Fairmount, a competitor of Wm. Mason, in the grocery trade.

The set of books into which these transactions are to be entered comprises Day Book, Cash Book, and Ledger. The D. B. and ledger are to be kept as in the preceding forms, except the entry of cash in the D. B. The set is given in full on pages 68-75, but the pupil should do the work in blanks of his own in the case of the D. B. and ledger, and should do it without referring to the forms in the book. Entries which have any new features will be explained as we proceed.

In doing the work we put ourselves in the position of John D. Wilson, the proprietor. Jan. 1, 1890. Began business with mdse. on hand amounting to $1750.00; cash on hand, $850.00. The cash on hand should be entered in the Cash Book. For form of cash book, see pages 72, 73.

You will notice that while each page is ruled like our D. B., the left-hand column corresponds to the Dr. side of our ledger, and the right-hand column to the Cr. side. At the top the word "Cash" is written instead of some person's name.

The easiest way to understand cash or cash acct. is to imagine cash to be a person with whom we have dealings. Suppose we have a clerk to whom we intrust $850 worth of property, and we make him Dr. to that am't, so that whenever we add to the am't in his possession we make him debtor for it, and whenever we take from the amount we make him creditor for it. This illustrates very well our method with cash. We charge cash with the money on hand, and with all money received or added to it. We credit cash with all money taken from it, i.e. paid out from it.

DRILL EXERCISE, No. 28.

Jan. 1, 1890. John D. Wilson commenced business with the following resources: - mdse. on hand (see inventory book), $1750; cash (see cash book), $850.

In this exercise our first entry in the cash book is on the Dr. side, $850. We explain why cash is debtor by using the words "to the amount on hand," and record the amount in the money column.