Howe, Mason & Co.
Trial Balance, June 30, 1918
| Land | $ 10,000.00 | |
| Buildings | 40,000.00 | |
| Reserve for Depreciation, Buildings | $ 2,000.00 | |
| Delivery Equipment | 6,000.00 | |
| Reserve for Depreciation, Equipment | 1,200.00 | |
| Furniture and Fixtures | 5,990.00 | |
| Good-Will | 6,000.00 | |
| Cash | 2,010.00 | |
| Accounts Receivable | 36,000.00 | |
| Reserve for Bad Debts | 1,460.00 | |
| Notes Receivable | 7,500.00 | |
| Notes Receivable Discounted | 4,500.00 | |
| Merchandise Inventory—Bags, June 30, 1917 | 6,770.00 | |
| Merchandise Inventory—Trunks, June 30, 1917 | 12,410.00 | |
| Mortgage Payable | 25,000.00 | |
| Accounts Payable | 26,000.00 | |
| Notes Payable | 14,400.00 | |
| Thomas J. Howe, Loan | 2,000.00 | |
| Thomas J. Howe, Capital | 12,000.00 | |
| Thomas J. Howe, Drawing | 1,210.00 | |
| Joseph Mason, Capital | 7,500.00 | |
| John H. Bartlett, Capital | 4,500.00 | |
| Wm. R. Gray, Capital | 6,000.00 | |
| Wm. R. Gray, Drawing | 1,100.00 | |
| Sales—Bags | 71,432.00 | |
| Returned Sales and Allowances—Bags | 3,690.00 | |
| Sales—Trunks | 222,386.00 | |
| Returned Sales and Allowances—Trunks | 1,508.00 | |
| Purchases—Bags | 59,315.00 | |
| Returned Purchases and Allowances—Bags | 4,230.00 | |
| Purchases—Trunks | 184,824.00 | |
| Returned Purchases and Allowances—Trunks | 2,716.00 | |
| Freight Inward | 7,020.00 | |
| Warehouse Labor and Supplies | 1,875.00 | |
| Salesmen’s Salaries | 4,303.00 | |
| Salesmen’s Traveling Expenses | 2,809.00 | |
| Advertising | 2,146.00 | |
| Freight and Cartage Outward | 1,154.00 | |
| Commissions on Sales | 981.00 | |
| Office Salaries | 2,274.00 | |
| Miscellaneous Office Supplies | 170.00 | |
| Legal Expense | 200.00 | |
| Postage | 127.00 | |
| Telephones and Telegrams | 93.00 | |
| Interest Earned on Notes Receivable | 385.00 | |
| Cash Discounts on Purchases | 3,547.00 | |
| Rent Collected | 1,500.00 | |
| Taxes | 1,312.00 | |
| Insurance | 680.00 | |
| Interest Paid | 472.00 | |
| Cash Discounts on Sales | 2,789.00 | |
| Collection and Exchange | 24.00 | |
| $412,756.00 | $412,756.00 |
The books have been closed at the end of each fiscal year.
Merchandise inventories, June 30, 1918, bags $2,431, trunks $4,380. A reserve of ½% of the sales is to be provided for bad debts. The furniture and fixtures are to be written down 10% of their book value.
The old account of Horses, Wagons, and Harness was closed and Delivery Equipment opened when the horses were sold and an automobile service installed. It is deemed advisable to increase the reserve by 10% of the declining value.
An additional 5% of the original cost of the buildings will be set aside as a reserve for depreciation.
Accruals are as follows: taxes $370; interest on mortgage 9 months at 5%; interest on notes receivable $80; interest on notes payable $520; interest on bank balances $61.20; office salaries $150; interest on Howe loan 6% for one year.
Advances made to salesmen on salaries $400; tenants paid $300 in advance rent; unused postage $32; miscellaneous office supplies on hand $30; one-fourth of the insurance remains in force; advertising deferred $600. Distribute in-freight and warehouse labor on the basis of gross purchases.
Profits and losses are to be shared according to the original investments, as stated in the articles of partnership.
One clause in the partnership agreement entered into July 1, 1915, read as follows: