him the whole of the money I have received from Joseph Jones, I would reduce my debt from £10. to £ 5 19..4. From these examples the defects of book-keeping by single entry must be obvious, when we consider the difficulty of taking the stock of a merchant of complicated and extensive dealings, an operation in itself of much labour as well as liable to error and fraud: the method by double entry is therefore in such cases constantly to be adopted, agreeably to the following observations and examples. In Book-keeping by double-entry three books are chiefly requisite, viz. the Waste-Book, the Journal, and the Ledger. The Waste-book contains, in simple clear language, a circumstantial and complete account or narrative of all transactions in business, in the order in which they occur. The Journal contains an account of the same transactions, but expressed in a more artificial way, so as to point out the debtor and creditor in each case, and thereby prepare the articles for being carried to the Ledger. In stating the Dr. and Cr. to an account, the following general rules are to be observed. 1st. That every article received, or every person accountable to us, is the Dr. 2d. That every article delivered, or every person to whom we are accountable, is the Cr. Or more particularly,-the person to whom or for whom we pay money, or furnish goods, becomes the Dr.; and the person from whom, or for whom we receive money or goods, is the Cr. Every thing which comes into our possession, or under our direction, is the Dr.; and every thing which goes out of our possession, or from under our direction, is the Cr. The following cases comprehend the most common occurrences in merchants' accounts. 1st. The person to whom any thing or article is deli vered, becomes Dr. to the thing or article delivered, when nothing is received in return. 2d. A thing received is Dr. to the person from whom it. is received, when nothing is delivered in return. 3d. A thing received is Dr. to the thing given for it. 4th. Goods and other real accounts, that is such as relate to property of every sort, are Dr. for all charges incurred by them. 5th. When any profits are received from real accounts, as rents of houses or land, freights of ships, bounties or goods, and the like, Cash becomes Dr. for the amount received, to the account or article from which the profit is derived. 6th. When any loss is sustained, the account of Profit and Loss, or some other of the same kind is Dr. to Cash for the amount. 7th. When any profit or gain arises, but not from any real account, Cash, the article received, or the person accountable for the profit, is Dr. to the account of Profit and Loss, or some other account of the same kind, for the amount. 8th. When one person pays money, or delivers any thing to another person on our account, the receiver is Dr. to the person who pays or delivers. The Ledger. In this book all transactions belonging to one person, or one article of merchandize, are collected together and entered as they occur, under one head, expressing the person or thing concerned in the account; and as every transaction there must be a Dr. and a Cr. the occurrence is entered in both accounts on opposite sides; and from this circumstance it is that Book-keeping by double entry has obtained its name. in All accounts in the Ledger are either real, personal, or fictitious. In personal accounts the person is entered Dr. or Cr. according according to the nature of the transaction, as in accounts kept by single entry. In real accounts each article is entered on the Dr. or Cr. side agreeably to the entries in the Journal. In fictitious accounts all articles appear which have a relation to Stock, or to Profit and Loss. By Stock is meant the merchant himself to whom the books belong, for his name never appears; and on the Dr. side of this account appear the debts owing by the merchant; while on the Cr. side appear the monies due to him, with the cash, goods, and other property belonging to him, in the outset of the books. By Profit and Loss is meant whatever may be gained or lost in business; and the Dr. side contains what is lost, while the Cr. side contains what is gained, upon every transaction. The following specimen will show the method of keeping the Waste-book, Journal, and Ledger, or Book-keeping by double entry. WASTE BOOK. WASTE-BOOK. London, 1st. January, 1808. Inventory of the money, goods, and debts belonging to me X, Z, as also of what I owe. £ S. d. £ s. d. 750 .. 0 이 I have in ready money David Jones, due 22d. 280.. 0.. 0 May, next. Bills payable for my ac ceptance of George Gray's 365 . 0.. 0 bill due 1st. March -4th. January Sold for ready money 8 pieces of Cloth, each 24 yards at 18s. 4d. per yard Jany. 6th.. Bought for ready money 50 pieces of 1828 8 0 525 0 0 176 0 0 19718 4 sht. WASTE-BOOK. January 8th. Bought of Richard Wilson 60 gallons of Rum, at 15s. per gallon £. s. d. 4500 11th. Sold William Brown 5 hhds. Sugar, 234 0 0 containing 65 cwt. at £3. 12s. per cwt. 13th. Sold Thomas Ellis 30 pieces of Linen ✔each 25 yards at 4s. 4d. per yard. Received in part The rest to be paid in 2 months 62.. 10..0 100.. 0..0 162 10 0 16th.. Bought of Robert Turner 36 pieces of Muslin each containing 15 yards, at 3s. |