Book-keeping for Farmers.

Ellesmere Guardian, Volume XXIX, Issue 2728, 27 January 1906, Page 2

Book-keeping for Farmers.

j The following concludes. Mr H. Niven's paper on the above subject : la opening a set of books, it would first -be nee'essary to take stock — that is, you must make an inventory of all your pjssessi >ns, aiid have them • under the headings of the accounts I have indicated, or as many as may be thoughc convenient. Commence by valuing your farm, then your dairy h-r.J, lurses ; sheep, pigs, the grain (that would mean the grain m stack at 31st March, say), then a list of all your implements, then any stores thafmight be on hand. I'will assume that all accounts due by you have been paid, and also all moneys due to you, so that, to begin with, it is simply what you possess that will your first inventory, I will, for Ihe purpose of illustration, assume that your farm is of too acres and is valued at £14 per acre, and that you possess the following slock and implements, which you would enter thus m your books: —

Inventory and Valuation of John Brown, Farmer Rdendale, at 31st March, 1905. Freehold Property Account. Section— , No — , Blk ' * — , 100 acres at £14 1400 00. 1y 1. .;...... .-.; ■■ ■ • '• — 1400 .0 O Jlilking Account. 30 ' cows, average value £f 210 o o March milk 25 o o — ——-.235 o o Grain Account. 20 Acres crop m stack J estimated to yield do bushels per acre ; 1200 bushels at is 60 o o - 60 o o Stock Account. t bay mare, 5 years 40 o o 1 bay mare, 6 years 45 o o 1 black gelding, aged 20 o o 1 bay gelding, 6 years 30 o o 1 spring cart mare, 7y« ; 20 o o 155 o o 20 ewes at 15s 15 o o 4 breeding rams at £2 800 178 o o : Implement Account. Farm implements 100 00 Household furniture 75 00 : — 175 o o Stores Account. Tea, sugar, flour, and all groceries, etc., m hand 700 £2055 o o

The other accounts would be opene< • as fansactions under their headingi 5 arose, it being always retnembere< t . that m double entry books you mus always have a corresponding credi to every debit. You have thus ; check, as the two columns of you journal must agree. The variou ilems are ported from the cash boo) a to the ledger direct, those entries 01 r. the right* and or credit side of tH p cash book going on the left-hand o y debit side of the ledger. Mr Browi c would then take his diary, and gi a through, it for the month, jotting ). down how he himself was employed . also his men, or any one who i - working and earning wages. Whei g a farmer works himself it is but righ j, that he should allot him -elf wages a so as to be able to arrive at a tru< c cost of his produce We will there[t tore suppose that Mr Brown allowei c himself 25s a week, and was work d ing as follows for the month of Apri c (2G days} 13 days, l t ad ; carting grain, 6 days, #1 5s =. carting coal for threshing, 1 day, 4 c 2d ; fencing straw stack, j day, 4 r 2d ; assisting at threshing, 5 days c £1 os iod ;— total, £5 8s 4d. Hii d man's work (at 20s a week) wo"ul< c probably be as follows :— Milking, 1! it days, £2 3s 4d ; working at thresh s ing, 6 days, £i; carting graio, 't c days, 13s 4c! ; carting water to mill n 3 days, 16s ;■— £4. 6s 8d Tota p wages, £9 15s. A rough wages-bool » could be ruled m an exercise bool with columns headed with, the differ- , ent accounts the items are likely tc . be charged with, : this will not inj volve much time, and is necessary v The months work can be run up g and the journal entry made as fol« g Iqws :-^r*undrjes, pr. to. wages acft count (milki g account £$ y^s §d, 3 grain account 17s 6d)> £9 13s. j I previously said that the items foi r Household Expenses could be apportioned the end of the year ; bul 9 if desired, it can be done monthly, as follows; Rations, we will say, ] cost ios per head. Two men workr ing and two m the house (the latter t not earning wages, but whose food . must be accounted for, and must , therefore be added to those who are f working) ; this would make a cost of s £s'per#feek,a tqtal of £§ ;« <id i for the roanth i the pqtry" for tms , would be as follows j —Sundries, Or. l to household expenses (milking ac- • count 6s Bd, grahr account . 6s 8J) , 13s 4d. This serves as . a sample of the course throughout the year. At the end of the year, »o ' arrive at a balance, another valuation '. must first be made. The values are ; credited to the old accounts, and debited to the account opened for the , year, and the sides of the ledger thus added up, and the summation taken , out oh a sheet of paper and added . up, and. the tqtals Qr and Cr. muu agree When -you have balanced youFledgef'you then pJ-oceed'to'clbse your account by Dr or Cr I . —profit and Io9S with the balances "of revenue and expenditure accounts. If an account shows a loss, you debit ; if a credit, credit the Profit and Loss Accpunf-rthfl difference between the $noqfcts. tq $r. a!t?d'Gr.*b;6in^ t^e pev 6Ult bf your year's working.- '''• !< < A balance-sheec is merely a trans cript of your ledger balances, and is practically a statement of your Assets and Liabilities. To listen to all the various entries that are required may lead you to suppose that it is somewhat an Intricate proceeding : but a little practice will soon reveal the why and wherefore of each entry, fw3 |n a yerv little tis<! you would, be Quite conversant ofo fhj

This paper is necessarily brief, but I have endeavoured to niake my " meaning as plain as possible ; and it would give me much pleasure to assist anyone m making a start to keep books m the manner thus sketched out.

The Chairman said the crux of bookkeeping was m letting a man know at a glance how he stood. A man should always be ready to "face the position," no matter if he knew that its consequences might be depressing. If he found he was not prospering, then he would be able to reflect, and see perhaps where some, economies raight be brought about He had himself kept account of his farming business for several years, but pleaded guilty to having gone out of the habit. Bookkeeping enabled a farmer to see, say, what (if any) part of his operations was not paying. Some might argue that that was an easy matter to determine; but it might not be so. For instance a field of turnips cost, say, 70s an. acre to produce. If the iarmer sold the turnips outright, he could make an. easy calculation ; but if he fed them to stock, the cost ' of carting them out, or of putting stock on to them, would need more complicated arithmetic— and it was here that Mr Niven's instructive and comprehensive paper proved its value, as either of these alternative modes of feeding might run the cost of production up another 40s an acre. He had pleasure m moving a hearty vote of thanks to Mr Niven for his valuable contribution, and also for his generous offer to give instruction m bookkeeping.