Mase. 2 20 400 ތލގ 571 100 100 198 Bot. of B.H. Keene 820 Bills Pay, on my note ab 2 md 8.B. Allen Mase. Expense 200 brls, Flour 4.19 198 820 23750. Bills Rec. of Jan. 9 Cash 2 WORK FOR THE STUDENT. GENERAL RULES FOR DEBITING AND CREDITING. Rule 1.-DEBIT what the business receives, or what costs value. Rule 2.-CREDIT what the business disposes of, or what produces value. TO BE ENTERED IN THE JOURNAL-DAYBOOK. Make the entries required by the following transactions similar in form to those shown in model journal-daybook on pages 6 and 7. No. 1.—JANUARY 1, 190–. I (your name) engage in the Flour and Grain business, investing cash, $4000. INSTRUCTIONS.-Whatever the business receives, or what comes into the business, should be debited; that is, it should be entered on the left-hand side of your journaldaybook. In this instance the business has received cash to the amount of $4000, hence Cash should be debited. Whatever the business disposes of, or whatever produces value to the business, should be credited; that is, it should be entered on the right-hand side of your journal-daybook. In this instance the proprietor has produced, or given, value to the business to the amount of $4000 by making an investment, hence the Proprietor should be credited. The following illustrates the form of the entry, though the amounts and explanation are different: Cash January 1, 190 Commenced the 3500 F. W. Leonard Flour and Grain business, investing 3500 Make an entry in your journal-daybook according to the above form. Write your name instead of that of F. W. Leonard, and place $4000 opposite Cash, and $4000 opposite your name, instead of the amounts shown in model. The amount placed in the lefthand column of your journal-daybook should be the same as that placed in the right-hand column; in other words, your debits and credits should always be equal. The name of the account debited is placed near the vertical lines at the left, and the amount placed in the left-hand money column. The name of the account credited is written one line below the debit, and about threefourths of an inch farther to the right. The credit amount is placed in the right-hand money column. Rule 3.-Debit CASH for all cash received. The term "cash" includes specie (gold, silver, nickel and bronze), treasury notes, national bank notes, gold and silver certificates, checks, post-office money orders, express money orders, bank drafts, and certificates of deposit. Rule 4.-Credit the PROPRIETOR with all amounts which he invests in the business. No. 2.-JANUARY 2, 190-. Paid J. C. Smith $75 for one month's rent of store. INSTRUCTIONS.-Whatever costs the business value should be debited. In this instance you have paid $75 rent for the benefit of the business. Rent has cost the business value. It is an expense to the business, hence Expense should be debited. Cash has been disposed of. It has produced value to the business; that is, it has been used by you to pay the rent of your store, hence Cash should be credited. The following illustrates the form of your entry, though the amounts and explanation are different. Expense Paid 13.W. Ames January rent in cash 100 10 Before attempting to make the above entry, examine the model journal-daybook on page 6 so as to be sure of the form and arrangement. Do not copy the illustrations, but make entries similar to them. Your entries must be made for the transactions given, and your amounts must be the amounts given in the transactions, and not the amounts shown in the illustrations. Leave one blank line after each transaction, and write the date in the center of this line, using ditto marks if the date be the same as that of the preceding transaction. Rule 5.-Debit EXPENSE for all expenses of the business. The expenses of a business include such items as outlays for rent, postage stamps, stationery, fuel, light, clerk hire, etc. Rule 6.-Credit CASH for all amounts which are paid out, or taken from the business. No. 3.—JANUARY 2, 190-. Bought of Scrantom & Wetmore, books and stationery for office use, for which I paid cash, $15. INSTRUCTIONS.-This transaction is of the same nature as the preceding one. Debit Expense (see rule 5); credit Cash (see rule 6). In the right-hand half of the wide space in your journal-daybook is written a complete record of the transaction. This record should be as brief as possible, yet it must show exactly what took place, for should any dispute arise it is this record and not the journal entry nor ledger record that will be used as evidence. No. 4.—JANUARY 3, 190-. Bought of the Upton Coal Co. for cash, for use in store, 5 tons of coal at $5.50 per ton; total, $27.50. INSTRUCTIONS.-As the coal is to be used for fuel, it becomes an expense to the busi Determine the debit by reading |