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Questions concerning the buying and felling of Stock. What is the purchase of 2220l. 10s. Bank per cent. ?

Example 1. stock, ot 105

£. s. d.

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the given time, its amount will be the intereft of the whole debt for the fame time.

In the method of discounting bills bankers commit a great crror, for they reckon the intereft of the fum drawn for from the time the bill is discounted till. it becomes due, including the days of grace; thus they take the intereft inftead of the discount, and make it more than it fhould be.

To make this more plain :-A had a bond of 1000l. due 1 year hence, which he offers to B to difcount for him at 5 per cent.; B, in imitation of the cuftom of bankers, asked A 50%. to discount the bill; but, fays A, 50l is the intereft of 1000l. for 1 year, at 5 per cent. therefore who is to have the intereft of the 50l. you or I? If you will return me the intereft for the 50l. which is 27. 10s. I will agree to your terms. A

added farther, If you will give me as much money for my bond as with the intereft will make up 1000l. at the year's end, I will deal with you-otherwife not; to which B agreed, and A calculated the intereft thus: as 1.05 is to 17. fo is 1000l. to 47.619 or 477. 125. 44d. which is the discount, and which subtracted from 1000l. leaves 9521. 78. 7 d. the prefent worth. Thus B got all the money he ought to have; for if B lends out the discount at 5 per cent. it will bring him juft 27. 75. 74d. and the amount will be juft 50l. at the year's end, and supposing A put out the 9527. 75. 71d. at 5 per cent. it will just bring in 477. 125. 44d. the money paid in hand to B, and he would have his 1000l. entire at the year's end.

But for goods bought or fold, when payment is made in ready money, without any regard to time, one year's intereft of the fum is generally

efteemed the discount.

Here it must be noted, that in compound intereft, if the intereft be paid half-yearly, it increases the amount to fomewhat more than when paid annually; and alfo if the difcount be fubtracted every half year, makes the reverfion fomewhat lets than when computed annually.

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Questions

Questions of this nature are resolved by the rule of prac tice: thus, in the foregoing example, I take the principal fum of 2220/. 10s. for the price of the Bank ftock, at 100%. per cent. and for the other 5 per cent. in the price of the ftocks, I take a twentieth part of the above fum 111l. os. 6d. and for the remaining per cent. I take a tenth part of the 51. line, which is 111. 25. od.; and these three lines added together is the answer.

Qu. 2. What is the purchase of 19751. 10s. India stock, at 113 per cent.?—Anf. 2249l. 125.

24. 3. What is the purchase of 16337. 45. Bank annuities, at 89 per cent.?—Anf. 14594. 135. 5žd.

24. 4. What is the purchase of 4109/. 125. in the 3 per cent. confolidated Bank annuities, at 55 per cent. ?—Anf. 22651. Ss. 34d.

CHAP. VI.

OF MERCHANTS ACCOUNTS.

SECT. I.

or BOOK-KEEPING THE ITALIAN WAY; OR, BY DOUBLE ENTRY.

THERE are feveral books ufed by mercantile men, of which the principal are the wafte-book, the journal, and the ledger. Thefe books are generally ufed by all men of

business;

bufinefs; I fhall therefore give an example of the use of each of them.

Of the Wafte-Book. ·

This book, by fome called the day-book, is used to pote down whatever occurs in the way of trade, as buying, felling, paying, receiving, delivering, &c. &c. without omitting any one thing.

This book has one marginal line on the left hand, and three lines for pounds, fhillings, and pence, on the right hand; the day of the month and the date of the year are inferted in the middle of the page.

Of the Journal.

Every thing which is written in the wafte-book must be transcribed into the journal in the proper mercantile terms, and in a fairer hand; and every article is to be fet down according to the order of time, without any intermiffion, to make the book of more validity in case of any controversy or difpute.

In this book every article bought or fold is distinguished by the name of debtor or creditor, and to this book recourse must be had for the particulars of any account.

In the journal the day of the month is alfo placed in the middle of the page; it is ruled with three lines, for pounds, fhillings, and pence, as the wafte-book is, and one, and fometimes two marginal lines on the left hand, to refer to the ledger.

Of the Ledger.

Every article is pofted into this book from the journal, but in fhort, in one line; every left-hand page of this book is called the debtor page, and each right-hand page the creditor.

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creditor. Every debtor page must have a creditor page of the fame number; thus, the articles or perfons which are called the debtors (in the mercantile phrase) must be entered on a page of the fame number with thofe called the creditors.

The day of the month, in this book, is fet in a narrow column on the left hand; at the top of each page is the name, the place of refidence, and the year of our Lord.

I shall give a few examples of the use of each of these books; but it must first be observed, that in the wafte book every article is written down in ordinary plain language, and entering the fame articles into the journal is nothing more than the fetting them down in the mercantile phrafe, diftinguishing each perfon or article by the name of debtor or creditor, for which the following rule must be strictly obferved:

All things received, or the receiver, are debtors to the delivered, or the deliverer.

Examples of the Ufe of the Wafte-Book.

April 2d, 1808.

Bought of Henry Smith, of Cheapfide, 100 yards of Irish linen, at 2s. 6d. per yard, to be paid in 3 months

Sold to John Jones, 20 yards of broad clotb, at 185. per yard, to be paid in 6 months

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Bought of William Williams, I cwt. of fugar, at 11. 18s. per cwt.

I 18

Bought of John Edwards, 60lb. of tea, at 5s. per. lb.

1618 0

Journal Entry.

April 2d, 1808.

Irish linen debtor to Henry Smith, 127. 10s. for ...100 yards, at 2s. 6d. per yard, to be paid in 3

months

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John Jones debtor to broad cloth for 20 yards, at 185. per yard, to pay in 6 months

12 10 O

18 00

287

OF MERCHANTS ACCOUNTS.

Libon fugar debtor to William Williams for
Icwt. at il. 18. per cwt.

Green tea debtor to John Edwards for 60lb.
at 5s. per lb.

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In the first of thefe examples I make Irish linen the debtor, as that is the article received, and Heary Smith creditor, as he is the deliverer.

In the fecond example John Jones is the debtor, as he is the receiver, and broad cloth the creditor. The fame may be obferved in all the other examples which follow...

Thus an experienced perfon may keep a journal without a wafte-book, as they both import the fame thing.

et bis Ifhall, however, give a few more examples of each : and firft the form of an inventory, as that is always taken down. abrew I mbi to dque &

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An inventory of all the money, goods, and debts, belong.

ing to me, A. B. of London, merchant: viz.

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Received from Benjamin Hughes, in Jamaica, 50 puncheons of rum, at 181. per puncheon, to

pay in 6 months

VOL. I.

900 00

January

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