school of Belize, British Honduras, being afterwards appointed superintendent of all the schools in the colony. He came to New York fifty years ago and obtained, by examination, a principal's certificate to teach in the public schools. While teaching in Manhattan, Mr. Hardcastle had charge of two of the sons of the late Peter Gilsey. For Mr. Gilsey he solved a problem affecting the income tax and sinking funds, his solution being accepted by the Income Tax Commissioners. Mr. Gilsey was so much pleased with Mr. Hardcastle's work that he offered him a position in his office, and for forty-two years last past, he has been expert accountant and agent for the Gilsey family. Mr. Hardcastle was the first accountant to take the New York State examination for certified public accountants and received the first certificate issued to a successful candidate. He took an active interest in all matters relating to the profession, and had opened an office for active practice but a few weeks before his death. He was a member of the New York State Society of Public Accountants, the Institute of Accounts and the New York Society of Accountants and Bookkeepers. Mr. Hardcastle was a prolific writer on accountancy subjects, and enjoyed an enviable reputation as an authority in this field. His published works include in addition to a large number of magazine articles, a book on "Executors' Accounts," his chosen specialty. Another book on "Accountics" was in preparation at the time of his death. An article from Mr. Hardcastle on "Single Entry" appears in this issue of the JOURNAL. In June, 1905, New York University conferred upon Mr. Hardcastle the honorary degree of Master of Humane Letters. Mr. Hardcastle was seventy-nine years old at the time of his death. Pennsylvania C. P. A. Examinations. The following papers were set at Philadelphia May 21-23 by the Pennsylvania Board of Examiners of Public Accountants: I. Practical Accounting. May 21, 1906, 9 A. M. to 5 P. M. A printing and publishing company has the following depart ments : (1) Bindery and Composing Room (3) Subscription Sales Department (5) General Office The system of accounts under which the business is operated does not classify and arrange the various parts of the business and the accounts relating to each in such a way as to render possible an easy grasp of the general situation. The difference between the assets and liabilities and the final net profit for the year are shown, but the various constituent elements entering into these final results are by no means easily traced. The personnel of the General Office consists of general officers, bookkeepers and clerks. This office is responsible for the general conduct of the business, and for the maintenance of the buildings. It also handles and conducts the selling end of the business, negotiates loans and pays taxes. The Bindery Department is conducted as a manufacturing business. It does work for outside customers, and for the Store Department. It purchases its own materials, other than white paper, pays its own wages, maintains its own equipment, and delivers its own goods. The Store buys white paper for the Bindery, and also buys books from the Bindery and from other publishers. It sells paper and books to other departments, and books to customers. It maintains a selling and advertising organization and a shipping and delivery department. The Subscription Sales Department conducts a subscription sales business, purchasing books from the store and from outside publishers employing a force of salesmen and placing advertising in various periodicals, also sending out circulars. The Periodical Department publishes and sells two magazines. This department receives subscriptions and advertising, purchases manuscript, maintains an editorial department, advertises the magazines, and defrays the cost of paper, printing, and binding. In all departments there are certain incidental expenses which are not properly chargeable to any one department. Devise a system of accounts for this business, assigning to each department the debits and credits which can properly be traced to it, carrying the result thus arrived at into a general profit and loss account. Describe and define the use of each account. Prepare a pro-forma balance sheet showing the accounts that you would carry for the assets and liabilities of such a business, also a proforma trading account for each department, and a pro-forma profit and loss account. Show the accounts and the arrangement thereof omitting figures. 2. The Assets and Liabilities of the Corry Coal Company, January 1, 1905, as disclosed in its Ledger at the Main Office, were as follows: The Mine Books disclosed assets January 1st, 1905, as follows: Cash Store Supplies Coal Wages paid but not earned $1,250.00 28,900.00 14,800.00 4,300.00 $49,250.00 During the year 1905 the transactions of the Company were, as follows: Coal sold Store supplies bought on credit. Store Supplies sold for Cash... Store Supplies sold to Wage earners on credit .$297,000.00 163,000.00 15,105.00 Wages earned during year paid in cash... 116,700.00 ceivable ..... 434,000.00 Cash paid on account of Accounts Payable 193,500.00 The Mine Books, at the close of the year disclosed Assets, as follows:Cash These Assets amounting to $70,705.00 were carried in the books of the Main Office at a valuation of $53,410.20. Submit balance sheet as of Jan. 1, 1906 from the Main Office Ledger; also statement giving the true condition of each Ledger Account assuming the Main Ledger Accounts to have been properly revised. 3. A. B. and C. form a Co-partnership. A. contributes $275,000.00 and is to receive 25% of profits. The profits for the first year amount to $300,000.00. Desiring to embark in a new business A. purchases all but 1-6 of C.'s interest in the profits for the ensuing year for $370,000, and thereafter sells to B. all but 1-3 of his interest in the future profits for $450,000, the amounts thus paid for the interests sold being added to the capital already contributed. Upon the assumption that the balance due to C. on Capital Account increased by the amount received by him from A. equals 1-6 of the amount of the Capital of a new firm what additional amounts must be contributed by A. and B. to warrant their pro rata of profit of 1-3 and 2 respectively and what would have been the condition of the account of A. B. and C. respectively if the profits for the year amounted to $700,000, also what would it have been had the interest of each in the profits remained on the basis of their interest as stated for the first year to wit: 25%, 122% and 62% assuming interest @ 6% is allowed each on the amount of Capital invested? 4. The Maryland Street Railway Company with an authorized Capital Stock of $1,000,000 consisting of 5,000 shares each of Preferred and Common Stock at the par value of $100 had on January 1st, 1905, assets and liabilities as follows: The Deposit Electric Company, with an authorized Capital Stock of $500,000 had on the same day, assets and liabilities as follows: The Maryland Street Railway Company purchased securities of the Deposit Electric Company in quantities and at prices as follows:— $400,000 of the Capital Stock @ $125 payable in Cash. $50,000 of the Capital Stock @ $130 payable with $30,000 of the preferred stock of the Maryland Street Railway Company @ $150 and cash to balance. $100,000 of the Bonds @ $115 payable in the unissued Common Stock of the Maryland Street Railway Company @ $93 and cash to balance. $10,000 of the Cash payable for the Stock purchased to be passed to the credit of the profit & loss of the Deposit Electric Co. by the Vendors to cancel the charge of like amount to said ac count. To provide funds to meet the above obligations and also to retire its 5% Mortgage Bonds @ $105. the Maryland Street Railway Company issued $1,000,000. of 4% Bonds and sold the entire amount there for Cash at 95%. Assuming that the dividend of the Deposit Electric Company declared during the year 1905 amounted to $25,000. and the profit of the Maryland Street Railway Company from operating, exclusive of interest on its bonded debt amounted to $100,000. to what extent has the Profit & Loss of the Maryland Street Railway Company been affected, during the year, by reason of its acquisition of the securities of the Deposit Electric Company and of the redemption of its own 5% Bonds. Show also the condition of accounts of the Maryland Street Railway Company at the end of the year. 5. The Estate of John Smith, deceased, consists of Securities etc., appraised as follows: $100,000 Wabash R. R. 5% Bonds $400,000 Pittsburgh Traction Co. 3% Bonds.. APPRAISED VALUE. .$125,000.00 230,000.00 275,000.00 400,000.00 100,000.00 375,000.00 50,000.00 $1,555,000.00 also Real Estate subject to mortgage liens of $100,000 @ 5%. The will provides for legacies amounting to $100,000 payable to sundry parties, and directs that Securities be set aside to pay out of the Incom.e derived therefrom an annuity of $10,000 to the Widow to whom shall also be paid one-third of the net income from the Real Estate; and the Income from Personal Property is made payable one-fourth to Maggie Jones, one-third to Sarah Peters and the balance to James Smith. The residue of the Estate, real and personal, is payable to the said James Smith at the death of the Widow and of Maggie Jones and Sarah Peters. Five years from the death of the Decedent, the Executors Accounts were as follows: Securities set aside to pay annuity to Widow: $200,000 Fort Wayne R. R. 5% Bonds Interest received Interest in Default $35,000.00 15,000.00 RECEIPTS. Accounts Receivable, not appraised in Inventory.....$17,000.00 Accounts Receivable 60% of value.. 60,000.00 Accounts Receivable on account 175,000.00 |