will be able to keep his stock about equal to the demand, without being in danger of running short or of carrying over a large amount of stock from the previous season. When all the goods for a month have been cut and made up the footings of the third and fifth columns should be equal.

Stock Tickets. The object of the Stock Tickets is to keep track of the goods while being manufactured. Suppose that 100 dozens of any one style are cut, that number should

Order

No.

Kind.

SEPTEMBER.

pass through the making departments, and when finished, be delivered to the salesrooms. If a less number is delivered to the salesrooms an investigation is made and the loss traced to the proper department. Without some such record it would be possible for dishonest. employees to carry away stock without being detected.

Pay Roll Book. The form of Pay Roll illustrated below is one that can be used to advantage in any business where employees are paid off monthly. A column is provided to receive the amounts paid employees on account. This form of Pay Roll contemplates that a detailed record of the employees' time, in the different departments, be kept in each foreman's Time Book, and that only the total amount due each employee be carried to the Pay Roll. The only difference between a Pay Roll Book and a foreman's Time Book is in the size, the latter usually being pocket size.

Cash Book. The Cash Book used in this business is of the ordinary form of special column Cash Book. (See illustration on pages 164 and 165.)

Journal. The ordinary form of Journal will be used to record the purchases and credit the proper departments. If the purchases are sufficient in number to warrant it, an Abstract Purchase Ledger and a Charges Department form could be kept, the same as in the department store business.

Student's Records. The student will make his records from a description of the transactions. H. T. Williams, the partner having the management of the manufacturing plant will keep a record of the cash receipts and payments in a Petty Cash Book, from which you will write up the regular Cash Book. The entries in the Petty Cash Book are proved each day with the amount of cash on hand by Mr. Williams, so it will not be necessary for you to prove the cash. The balance of cash on hand on the last day of the month should agree with the amount called for by the regular Cash Book.

Petty Cash Book. This book is usually a coarse, cheap book and the entries in it are generally made in pencil. All entries in this book should be made by the person or persons handling the money. Whenever possible, but one person should be permitted to receive and pay out the cash, and he should be held responsible for the correctness of the same. Being a

book of original entry, great care should be exercised in keeping the Petty Cash Book, as it takes precedence over the regular Cash Book when brought into court as evidence. The entries in the regular Cash Book are generally made but once a day; they are taken from the Petty Cash Book and from the stubs of the Check Book. As no Check Book is kept in this business, Mr. Williams will keep a memorandum account with the bank, charging it with all deposits and crediting it with all checks drawn. In this case all checks received and issued will be entered in the Petty Cash Book; ordinarily this is not done in business.

Mill Account. In business it is customary to keep an account with the Mill or Tanning Department, to determine if it is a paying investment. In that event Mill account is debited for all that it receives in the way of labor and chemicals needed in tanning and dressing the raw hides into glove leather, and is credited for the market value of all leather that it produces. If the cost of running the Mill is more than the market value of the leather produced, it would not be a paying investment and would be discontinued, as it would be cheaper to purchase the leather already dressed. As the Mill account would be kept very similar to a Branch Store account, the student is not required to keep a separate account with the Mill in this business.

Division of Labor. The use of more than one Ledger in a business presupposes a division of labor among several bookkeepers. The method of keeping a General Ledger and several sub-ledgers has been fully explained, consequently in this business but one Ledger will

be used.

This will enable the student to concentrate his attention on the features that are special to the manufacturing business. It must be remembered, however, that it is customary and necessary to keep more than one Ledger in large manufacturing establishments.

JULY 7, 189-.

D. T. Paterson, the expert accountant engaged by the partners, to investigate the standing of the glove manufacturing plant owned by J. B. Luckey reports as follows:

July 6, 189-.

(Your place here.)

MESSRS. J. A. LUMAN & Co.,

GENTLEMEN:

Proprietors City Department Store, City.

Herewith I hand you the report of my investigation of the books of record and financial standing of the glove manufacturing plant, owned and for forty-five years conducted by J. B. Luckey.

1. After a careful research among the records of this (your) County, I am assured that J. B. Luckey is the legal owner of the said glove plant. There are no incumberances of any kind on record, consequently he is able to sell and give good title to the purchasers. Taxes of every description have been paid, as is evidenced by the tax receipts submitted herewith.

2. Inquiries have been made of all former creditors as shown by the books, and their replies submitted herewith are evidence that all obligations of every description have been discharged.

3. Advertisements were inserted in the daily papers in which all creditors were requested to present their claims for payment. No claims, other than those credited on the books were presented, and all presented were paid.

4. The market value of the merchandise on hand is found to be $7536.40. (See Inventory submitted herewith.) The machinery, after considering the first cost, repairs, wear and tear, and the decline in the price of machinery, I find (by estimation) to be worth $44818.20. The real estate is inventoried on the books at $32000, which amount I consider it to be worth. Furniture and fixtures are inventoried at $400 and are probably worth more. Accounts Receivable, or amounts due from others, are as follows: Heywood & Co., $4280; R. S. Thomas, $2242.40. Judging from their past records and their present financial circumstances, as reported by the commercial agencies, these accounts will be paid in full as soon as due. Their replies to my letters written to them certify that the claims are just and that it is their intention to honor them.

5. Taking into consideration the fact that this plant has been in successful operation for forty-five years, that its business has steadily increased, that all its obligations have been honestly discharged, and that the yearly sales have averaged fully $75000 in the past fifteen years, I estimate the Good Will to be worth $30000. 6. The actual inventory value of the plant is thus found to be $91277; the value of the Good Will added to this makes the plant worth $121277.

The above report meets with the partners' approval. The amount asked by Mr. Luckey is $100000, of which each of the partners has paid one fourth. Make the entry in the Journal, debiting Merchandise, Machinery, Real Estate, Furniture and Fixtures, Heywood & Co., and R. S. Thomas for the amounts named in the accountant's report. Debit Good Will for the difference between the net value of the assets and the price paid. Credit each of the partners. for his share. For entry of a similar nature see page 87. Open the above accounts as indicated in the index printed on the cover pages of the Ledger. Post and check over your posting. Mr. H. T. Williams is to be the manager at a salary of $150 per month. With the exception of the bookkeeper, all of the former employees of J. B. Luckey have been retained. The names of the employees will be handed in by the foremen of the different departments at the end of the month. Wm. Cloud, the superintendent of the Mill is to receive a salary of $1500 per year; John Hermann, the traveling representative is to receive a salary of $100 per month, and Jas. Mackey, the shipping clerk is to receive a salary of $40 per month.

The partners have withdrawn $5000 from the department store business to be used in conducting the glove manufacturing business. This amount is borrowed from J. A. Luman & Co., but you are not to make the entry now as Mr. Williams has made a record of it in the Petty Cash Book, from which book it will be transferred to the regular Cash Book. The kind of gloves to be placed on the market are specified by numbers in the following price list:

The cost and selling prices of the various numbers on sale were ascertained as shown in the illustrations and explanations of the Cost Book and Merchandise account. (See pages 159 and 160). Make a detailed analysis of the cost of No. 1126 so that you will understand how the cost and selling prices are ascertained. Your teacher will assist you, if you are unable to make the calculations. In business this work is usually done by the superintendent of the plant, or by the bookkeeper under his direction.