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This amount must also equal the sum of all the general and demonstrative legacies except those to the trustee, unless some legacies have not been paid, in which case the difference will be the amount of those which have not been paid. If these qualities do not appear there is an error in addition or there has been a failure to enter the same figure to the legatees ledger as was entered in the original record.

The net debit to the Inventory account (the difference between the total debits and the total credits) must equal the appraised value of all the assets which are still unrealized upon,2 as shown in the Realization account, and the Realization account must itself balance. (See § 585.) If this test fails and the error is not one of addition it is due to a failure to credit Inventory account with the appraised value of some asset which has been disposed of.

§ 630. Reconciling the Bank Account

Ordinarily the balance on deposit according to the statement furnished by the bank or the balance brought down in the pass-book will be greater than the balance shown in the depositor's books of account by the amount of the checks issued but not yet presented at the bank for payment. If this is not true, the error is due to:

1. Failure on the part of either the bank or the depositor to enter correctly the amount of some deposit or check.

2. Failure on the part of the depositor to deposit some receipt.

3. Failure on the part of the depositor to enter in his books some charge (for collection, interest, etc.) made by the bank against his account.

4. An error in addition or subtraction on the part of the bank. If the depositor's own general books are in

2 Including any after-discovered assets not sold or distributed. See §§ 586, 627.

balance the error could not have been one of addition or subtraction made by him unless he has made a compensating error, i.e., an equal error in the other direction.

All the above reconciliations must appear before the account can be properly prepared. If there is an error it must be found and corrected.

§ 631. Preparing the Closing Entries

The closing entries can best be made in connection with the preparation of the various schedules of the final accounting. When we outlined our system of accounting for estates (see § 570), we planned to have an account for each group which would have to be handled separately in the accounting for the court. Form 28 shows the final accounting of the estate whose before-closing trial balance is shown in § 628 above. An examination of this form will show us that the groups are as follows:

Inventory.

Realization of Assets Not in Inventory.
Gain on Realization of Appraised Value.

Loss on Realization of Appraised Value.

Specific Legacies Distributed.

Items in Inventory Undistributed.

Funeral and Administration Expenses Paid.

Debts of Decedent Paid.

Payments Made on General and Demonstrative Legacies.

Payments of Principal to Trustee.

Cash on Hand.

Income Received.

Expense Against Income.

Loss on Income.

Payments of Income to Trustee.

These are the accounts whose uses we have been examining. The summary, schedules, and closing entries may now be prepared together, in the manner described in the following sections.

§ 632. Debits on Account of Corpus

As the executor must distinguish his receipts and disbursements between corpus and income, the summary is divided into two parts, one for corpus and another for income. The first of these is for corpus. In starting this, the six-column schedule (see § 585 and Form 27), on which we have been keeping a record of the realization of our inventory, may be put to excellent use. The total of the first column, down to the end of the appraisal as filed, is the amount of that appraisal, and is entered as the first item in the summary. (See Form 28, "Account of Proceedings.")

The after-discovered assets sold and on hand are shown in the remainder of the first column, the total of which becomes the second item in the summary. When this amount is recorded, the Assets Not in Inventory account, which will show the same total, may be closed out by the first of the closing entries:

Assets Not in Inventory..
Estate Corpus

$1,475.23

$1,475.23

The fourth column of the Realization account represents the other debit to the executor, and when its total is entered as the gain on realization of appraised value, the Gain on Realization account is closed out:

Gain on Realization...

Estate Corpus

$952.28

$952.28

The total charges to the executor on account of corpus are then the sum of the credits in the Estate Corpus account.

§ 633. Credits from the Realization Account

Three of the credits in our summary of the corpus are also taken from the Realization account. From the third column we obtain the amount of loss on realization of appraised value, and having entered it we may close the Loss on Realization account by the entry:

Estate Corpus

Loss on Realization...

$4,250.63

$4,250.63

The next item in the summary is the appraised value of the specific legacies which have been distributed. Its amount is shown by the fifth column of the Realization account and by the Specific Legacies Distributed account on the synoptic or general ledger. When this total has been entered on the summary the ledger account may be closed by the entry:

Estate Corpus

Specific Legacies Distributed.

$16,023.28

$16,023.28

The summary next shows the undisposed-of balance of the inventory, including any after-discovered assets not sold. This figure is the total of the sixth column of the Realization account and is the balance in the Inventory account on the synoptic. The Inventory account, which is a balance sheet item, is not closed out.

§ 634. Schedule A-Realization of Assets

To preparc Schedule A, simply have a copy of the Realization account made with the proper heading, Schedule A, Realization of Assets. This should be prepared on a sheet so arranged that there is a space to the right of the figures sufficiently wide to enter the various explanations called for, such as manner of sale, reasons why various assets have not been sold and debts not collected, and details as to loss by accident, such as theft and fire, etc.

By keeping the Realization account during the progress of administration we have avoided at the time of winding up the estate the tedious work of digging out the information needed for the schedules, and have so arranged our work that the most important of our schedules is prepared for us in the very keeping of our books. In fact, it may be said that the first five of our schedules are prepared for us by our method of keeping our accounts, for under the plans suggested by earlier writers separate schedules are required for each of the five items combined in our Schedule A.

§ 635. Other Corpus Credits

The other corpus items for which the executor takes credit in the account are shown in the schedules listed below (see Form 28):

Schedule B, Funeral and Administration Expenses.

Schedule C, Debts of Decedent.

Schedule D, Payments on Legacies.

Schedule E, Payments of Principal to Trustee.

These schedules are easily prepared from the entries on the synoptic or general ledger, being, in fact, merely copies of the accounts with the necessary explanatory matter. The form in which they are written is largely a matter of personal pref

erence.

These accounts should then be closed on the books by the following entries:

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