A general list of expenses has already been given. While taxes are frequently set up as a separate account, assume that in this bank they are handled through expense, and that the sum of $3,000 is paid therefor. The general ledger entries are:

Debit. Expense (22) ..........................................

$3,000

Credit: Cash (11).................

$3,000

A similar entry would be made for all other types of expense with the description in each case on the entry ticket showing the character of the expense.

Auxiliary Record Of Expense

It is advisable for the general bookkeeper to keep an auxiliary record of expense, preferably classified by kind, so that each item may be placed under its proper classification, as a basis for a detailed report of earnings and expenses. The total of the items in the auxiliary record should, of course, prove with the debit balance of the expense account. As previously explained, the expense account is closed semi-annually or more often, depending upon the system used in the undivided profits account. The closing entries have the undivided profits account.