The trial balance shown on pages 222-225 brings in examples of all the types of accounts usually required in real estate accounting. • It affords a convenient basis for the study of such accounts, by providing examples of the various methods of calculating profits, and illustrating the difficulties or irregularities which may occur. This trial balance is based on one taken from the books of a concern operating about thirty subdivision properties. The figures are left practically as they were found in the course of auditing, and the trial balance as given may therefore be considered an example from actual practice.

The method of dissecting accounts on analysis paper, as shown in connection with the trial balance, is familiar to accountants and should be clear to any reader. The various columns are introduced in order to simplify the preparation of proper schedules to accompany the balance sheet, and also to prove all new entries made, especially those affecting Profit and Loss, by checking the balance of the account shown on the sheets against the account in the ledger after all closing entries have been made.

The statement below is a summary of the trial balance shown on pages 222 to 225. Its total is, naturally, less than the total of the trial balance, as sundry accounts have been closed or adjusted.

Summary

Dr.

Cr.

Profit and Loss........................

$99,158.48

$152,170.49

Real Estate......................

779,356.89

Contracts..................................

568,433 33

Profits in Reserve..............................

361,790.37

Accounts Receivable...........................

1,477.00

Accounts Payable............................

695.71

Balance Sheet Item:........................................

102,804.52

1,036,573.65

$1,551,230.22

$1,551,230.22