Either of the foregoing methods may answer for farmers and for country mechanics generally, but to the retail merchant and others whose business is extensive, an acquaintance with book-keeping by the day-book, and ledger called single entry, or by the day-book, journal and ledger, called double entry, is indispensible. The latter is much the most perfect system, and far best for wholesale dealers, but as it is more complicated and seldom used, we shall confine our attention to the former, which is generally adopted by merchants and others in this country. BOOK-KEEPING BY SINGLE ENTRY. Single Entry requires two principal books, the day-book, or waste book, and the ledger, and one auxiliary book, the cash-book. 1. THE DAY-BOOK. This book is ruled with two columns on the right hand for dollars and cents, one column on the left for inserting the folio or page of the ledger, to which the account is transferred, and a top line over which is written the month, date and year. The articles are separated from each other by a line drawn across the page, and the transactions of one day from those of another by a double line in the centre of which is the day of the month. This book commences with an account of all the property, debts, &c. of the person, and is followed by a distinct record of all the transactions in trade in the order of time in which they occur, with every circumstance necessary to render the transaction plain and intelligible.* In entering accounts in the day-book, the following order should be observed: 1, the date; 2, the name of the person, with the abbreviation Dr. or Cr. at the right hand as he is debtor or creditor, by the transaction;t 3, the article or articles with the price annexed, and the value carried out into the ruled columns, with the amount *As the day-book is the decisive book of reference, in case of any supposed mistake, or error, in the accounts in the ledger, it is of the greatest importance that every transaction be noted in it with particular perspicuity and accuracy. To know when a person is to be entered Dr. and when Cr. see note preceding page. placed directly under, when there is more than one article charged; and 4, the page to which the account is transferred in the ledger. For the better understanding of the day-book, see the specimen annexed. 2. THE LEDGER. Each page of the ledger is ruled with a top line, on which is written the name of the person, and marked Dr. on the left hand for receiving the debited articles, and Cr. on the right for receiving the credited articles of the day-book. On the right hand of both Dr. and Cr. sides, are ruled two columns for dollars and cents, and on their left, three columns, one for the page of the day-book, one for the month, and one for the date. The ledger has an index, in which the names of persons are arranged under their initial letters, with in the ledger, where the account may be found. the page Rule for Posting-Under the name of the person, enter the several transactions on the Dr. or Cr. side in the ledger, as they stand debited or credited in the day-book. When several things are included in the same transaction, they are distinguished by the term "sundries." Some accountants enter in the ledger only the page of the day book and the amount of the transaction, without specifying the items, but the former is thought the most correct. Balancing Accounts.-When all the articles are correctly posted into the ledger, each account is balanced by subtracting the less side from the greater, and entering the balance on the less side, by which both sides are made equal. The excess of all the balances on the Dr. over those on the Cr. sides, added to the cash on hand and the value of the goods unsold, the sum is the net of the estate, which, compared with the stock at the commencement of business, cxhibits the merchant's gain.* 3. CASH-BOOK. In the cash-book are recorded the daily receipt and payment of money. For this purpose it is ruled with separate columns, one for money received and the other for money paid, in which should be recorded merely the date, to or by whom paid and the sum. The cash-book is convenient, but not absolutely necessary. Other auxiliary books are sometimes used and are important in some kinds of business, but the accountant will readily form these for himself, as circumstances may render necessary. * When the place assigned to any person's account is filled with items, the person's name must not be entered the second time, but may be transferred to another page in the following manner. viz. Add up the Dr. and Cr. columns and against the sums with Amount transferred to page --- here inserting the page where the new account is opened. Begin the new account by entering on the Dr. side, To amount brought from page inserting the page of the old account, and on the Cr. side, By amount brought from page, inserting the page of the old account, placing the sums in their proper columns. As several day books and ledgers may be necessary in the progress of business, they should be distinguished by lettering them, as follows: day-book A. day-book B, &c.-Ledger A. ledger B, &c. and in posting accounts into the ledger, there must be a reference to day-book A or B, &c. as the account is found in one or another. |