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Full text of "Form of general balance sheet statement as prescribed by the Interstate Commerce Commission for Steam Roads in accordance with section 20 of the Act to Regulate Commerce [microform]. First issue. Effective on July 1, 1909"

MASTER 
NEGATIVE 

NO. 94-82237 




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violation of the copyright law. 



Author: 

U.S- Interstate Commerce 
Commission 

Title: 

Form of general balance 
sheet statement as... 

Place: 

Washington, D.C. 

Date: 

1909 



COLUMBIA UNIVERSITY LIBRARIES 
PRESERVATION DIVISION 

BIBLIOGRAPHIC MICROFORM TARGET 



ORIGINAL MATERIAL AS FILMED - EXISTING BIBLIOGRAPHIC RECORD 





U, S, Interni.ate comneroe coniniission. 

Form of general balance sheot statenent as pre-, 
scribed by the Interstate oonmerce coTunission f or ■ 
stean roads in accordance v/ith f5ect?.on 20 of the -. 
Act to regulate commerce. First isnue. Effective 
on July 1, 1909, Vfashington, Govt, print, off., 
1909. 

3ri p. 2Prh cm. 




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FORM OF 




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AS PRESCBIB£D BY THB 




INTEJRSTATE COMMERCE COMMISSION 



FOR 



STEAM ROADS 

IN ACCORDANCE WITH 

SECTION 20 OF THE ACT TO REGULATE 

COMMERCE 



FIRST ISSUE 



Effective on July 1, 1909 



WASHINGTON 

GOVERNMENT PRINTING OFFICE 
1909 



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FORM OF 




AS PRESCRIBED BY THE 



INTERSTATE COMMERCE COMMISSION 



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STEAM ROADS 

IN ACCORDANCE WITH 

SECTION 20 OF THE ACT TO REGULATE 

COMMERCE 



FIRST ISSUE 



Effective on Juhj 1, 1909 



WASHINGTON 

GOVERNMENT PRINTINCi OFFICE 
1909 



i. 1^ 






\WF 





4 



THE INTEKSTATE COMMERCE COMMISSION. 



IklARTiN A. Knapp, of New Yorh 
JuDSON C. Clements, of Georgia. 
Charles A. Prouty, of Vermont 
Francis M. Cockrell, of Missouri. 
Franbxin K. Lane, of California. 
Edgar E. Clark, of Iowa. 
James S. Harlan, of Illinois, 

Edward A. Moseley, Secretary. 

(3) 



/ 



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Ty 



Commissioners. 



At a General Session of the INTERSTATE COMMERCE 
COMMISSION, held at its Office in Washington, D. C, 
on the 21st day of June, 1909. 

Present: 

Martin A. Knapp, 
JuDSON C. Clements, 
Charles A. Prouty, 
Francis M. Cockrell, 
Franklin K. Lane, 
Edgar E. Clark, 
James S. Harlan, 

The subject of a Uniform General Balance Sheet State- 
ment for the use of carriers making reports to the Conmiis- 
sion, and of the Ledger Accounts immediately pertaining 
thereto, being under consideration, the following order 
was entered : 

It is ordered, That the Form of General Balance Sheet 
Statement, with the classification of the accounts involved 
in such statement and the text pertaining thereto, pre- 
pared under the direction of this Commission by Henry C. 
Adams, in charge of Statistics and Accounts, and embodied 
in printed form, to be hereafter known as Form of General 
Balance Sheet Statement, a copy of which is now before 
this Commission, be, and the same is hereby, approved ; 
that a copy thereof duly authenticated by the Secretaiy of 
the Commission be filed in its archives, and a second copy 
thereof, in like manner authenticated, in the office of the 

(5) 



Bureau of Statistics and Accounts; and that each of 
said copies so authenticated and filed shall be deemed an 
original record thereof. 

It is further ordered, That the said Form of General Bal- 
ance Sheet Statement, with the classification of the ac- 
counts involved in such statement and the text pertainmg 
thereto, be, and is hereby, prescribed for the use of carriers 
by rail (exclusive of electric railways) subject to the pro- 
visions of the act to regulate commerce as amended June 
29, 1906, in the keepmg and recording of all transactions 
reflected m the said Form of General Balance Sheet State- 
ment ; that each and every such carrier and each and every 
receiver or operating trustee of any such carrier be re- 
quired to keep all accounts involved in the Form of Gen- 
eral Balance Sheet Statement in conformity therewith; 
and that a copy of such Form of General Balance Sheet 
Statement be sent to each and every such carrier and to 
each and every receiver or operating trustee of any such 
carrier. 

It is fuHher ordered, That the rules contained in said Form 
of General Balance Sheet Statement are, and by virtue of 
this order do become, the lawful rules according to which 
all entries in the accounts involved in such statement are 
defined; and that each and every person directly in 
charge of the accounts of any such carrier or of anv 
receiver or operating trustee of any such carrier is hereby 
required to see to, and under the law is responsible for, the 
correct apphcation of the said rules in the keeping and re- 
cording of all transactions pertaining to, or reflected in, the 
said Form of General Balance Sheet Statement; and that 
it shall be unlawful for any such carrier or for any receiver 
or operating trustee of any such carrier, or for any person 
directly in charge of the accounts of any such carrier or 
of any receiver or operating trustee of any such carrier, 
to keep any account or recortl or memorandum of any 



transactions pertaining to, or reflected in, the said Form 
of General Balance Sheet Statement except in the manner 
and form hereby prescribed : Provided, however. That noth- 
ing in this order shall be construed as depriving a carrier 
of the right to make whatever analysis of balance-sheet 
entries it may deem proper for the information of stock- 
holders or of officials who have the management of its 
property. 

It is further ordered. That July 1, 1909, be, and is 
hereby, fixed as the date on which said Form of General 
Balance Sheet Statement shall become effective. 

A true copy. 

Edw. a. Moseley, 

Secretary, 




INTRODUCTORY LETTER. 







Interstate Commerce Commission, 
Bureau of Statistics and Accounts, 

Washington, June il , 1909, 

To Carriers Concerned: 

The Form of General Balance Sheet Statement pro- 
mulgated under the foregoing order will be incorporated 
in the Forms for Annual Report of Carriers to the Inter- 
state Commerce Commission for the year ending June 30, 
1910, unless modified by an order of the Commission 
before that date. In any case, carriers whose current 
accounts are kept in such a manner as to enable them to 
report on the balance-sheet statement herewith promul- 
gated will be able to make any balance-sheet statement 
which the Conmussion may finally accept as satisfactory. 

There will shortly be issued a Special Report Series 
Circular calUng for the adjustment of assets and habil- 
ities as of June 30, 1909, to the form of balance-sheet 
statement promulgated under the present order, with a 
view of testing its practicability and of collating all dif- 
ficulties incident to its use. Any modification, should 
modification be thought desirable, will be made as the 

result of this test. 

Henry C. Adams, 
In charge of Statistics and Accounts, 

90303—09 2 (9) 



COISTTENTS. 



r, 



I 




Page. 
Form op Genebal Balance Sheet Statement 15 

GENERAL ACCOUNTS. 

Assets — 

Property Owned as Investment 18 

Working Assets 21 

Deferred Debit Items 23 

Deficit 28 

Liabilities — 

Stock 28 

Mortgage, Bonded, and Secured Debt 29 

Working Liabilities 32 

Accrued Liabilities Not Due 34 

Deferred Credit Items 34 

Appropriated Surplus 35 

Free Surplus.. 36 

PRIMARY ACCOUNTS. 
Assets — 

Property Owned as Investment — 
I. Physical Property Owned — 

1-A. Road and Equipment to June 30, 1907 18 

1-B. Road and Equipment since June 30, 1907 18 

II. Securities Owned — 

2. Securities of Proprietary, Affiliated, and Controlled 

Companies — Pledged 18 

3. Securities Issued or Assumed — Pledged 19 

4. Securities of Proprietary, Affiliated, and Con- 

trolled Companies — Unpledged 19 

III. Investments — 

5. Advances to Proprietary, Affiliated, and Con- 

trolled Companies for Construction, Equipment, 

and Betterments 20 

6. Other Permanent Investments 21 

(11) 



12 

Assets — Continued. 

Working Asseta — p^ge. 

7. Cash 21 

8. Marketable Securities 21 

9. Loans and Bills Receivable. 22 

10. Net Traffic, Car Mileage, and Per Diem Balance. . . 22 

11. Net Balance Due from Agents and Conductors 22 

12. Miscellaneous Accounts Receivable 22 

13. Materials and Supplies 23 

14. Other Working Assets 23 

Deferred Debit Itemsi — 

15. Advances. 23 

16. Insurance Premiums Paid in Advan<?e 24 

17. Taxes Paid in Advance 24 

18. Discount on Securities Issued 24 

19. Property Abandoned, Chaigeable to Operating Ex- 

penses 25 

20. Cash and Securities in Sinking and Redemption 

Funds 27 

21. Cash and Securities in Insurance and Other Special 

Funds 27 

22. Cash and Securities in Special Trust Funds 27 

23. Items in Suspense 27 

Deficit— "" 

24. Profit and Loss— Balance 28 

Liabilities — 

Stock— 

25. Capital Stock 28 

26 Receipts Outstanding for Capital Stock 29 

27. Stock Liability for Conversion of Outstanding Se- 

curities of Constituent Companies 29 

28. Premium Realized on Capital Stock Sold 29 

Mortgage, Bonded, and Secured Debt— 

29. Funded Debt 29 

30. Receipts Outstanding for Funded Debt 31 

31. Premium Realized on Funded Debt Sold 31 

32. Receivers* Certificates 31 

33. Obligations for Advances Received for Construc- 

tion, Equipment, and Betterments 31 

Working Liabilities — 

34. Loans and Bills Payable 32 

35. Net Traffic, Car Mileage, and Per Diem Balance. . . 32 



^ 




W^-# 



13 



Liabilities — Continued. 

Working Liabilities — Continued. Page. 

36. Audited Vouchers and Wages Unpaid 32 

37. Miscellaneous Accounts Payable 32 

38. Matured Dividends, Interest, and Rents Unpaid... 32 

39. Matured Mortgage, Bonded, and Secured Debt Un- 

paid 33 

40. Working Advances Due to Other Companies 33 

41. Other Working Liabilities - - 33 

Accrued Liabilities Not Due — 

42. Dividends Declared and Interest and Rents Ac- 

crued, Not Due 34 

43. Taxes Accrued 34 

Deferred Credit Items — 

44. Operating Reserves 34 

45. Liability on Account of Special Trust Funds 35 

46. Items in Suspense 35 

Appropriated Surplus — 

47. Surplus Reserves 35 

48. Additions to Property through Income since June 

30,1907 36 

Free Surplus — 

49. Profit and Loss — Balance 36 



V 




FORM OF GENERAL BALANCE SHEET STATEMENT. 



ASSETS. 



it 



l^nr )ii||^ .-w^jjp. 



PROPERTY OWNED AS INVESTMENT: 

I. Physical Property Owned — 

1-A. Road and Equipment to June 30, 1907 — 

(a) Road. 

(b) Equipment. 

1-B. Road and Equipment since June 30, 1907 — 
(a) Road. 
(6) Equipment. 

(c) General Expenditures. 

II. Securities Owned — 

2. Securities of Proprietary, Affiliated, and Controlled Com- 

panies — Pledged — 
(a) Stocks. 
(6) Funded Debt. 
(c) Miscellaneous. 

3. Securities Issued or Assumed — Pledged — 

(a) Stocks. 

(6) Funded Debt. 

(c) Miscellaneous. 

4. Securities of Proprietary, Affiliated, and Controlled Com- 

panies — Unpledged — 
(a) Stocks. 
(6) Funded Debt. 
(c) Miscellaneous. 

III. Investments — 

5. Advances to Proprietary, Affiliated, and Controlled Com- 

panies for Construction, Equipment, and Betterments. 

6. Other Permanent Investments — 

(a) Physical Property. 
(6) Securities. 

(15) 




II 



16 

WORKING ASSETS: 

7. Cash. 

8. Marketable Securities-— 

A. Securities Issued or Assumed — Unpledged — 

(a) Stocks. 

(ft) Funded Debt. 

(c) Miscellaneous. 

B. Other Marketable Securitiee— 

(a) Stocks. 

(6) Funded Debt. 

(c) Miscellaneous. 

9. Loans and Bills Receivable. 

10. Net TraflSc, Car Mileage, and Per Diem Balance, 

11. Net Balance Due from Agents and Conductors. 

12. Miscellaneous Accounts Receivable. 

13. Materials and Supplies. 

14. Other Working Assets. 
DEFERRED DEBIT ITEMS: 

15. Advances — 

(a) Advances to Proprietary, Affiliated, and Controlled 

Companies. 
(6) Working Funds. 
(c) Other Advances. 

16. Insurance Premiums Paid in Advance. 

17. Taxes Paid in Advance. 

18. Discount on Securities Issued— 

(a) Discount on Stock. 
(6) Discount on Funded Debt, 
li. Property Abandoned, Chargeable to Operating Expenses, 

20. Cash and Securities in Sinking and Redemption Funds. 

21. Cash and Securities in Insurance and Other Special Funds. 

22. Cash and Securities in Special Trust Funds. 

23. Items in Suspense. 

DEFICIT: 

24. Profit and La*?s— Balance. 




i 



STOCK: 



LIABILITrBS. 



25. Capital Stock— 

(a) Common Stock. 
(6) Preferred Stock, 
(c) Debenture Stock. 



17 

26. Receipts Outstanding for Capital Stock. 

27. Stock Liability for Conversion of Outstanding Securities 

of Constituent Companies. 

28. Premium Realized on Capital Stock Sold. 

MORTGAGE, BONDED, AND SECURED DEBT: 

29. Funded Debt— 

(a) Mortgage Bonds. 

(6) Collateral Trust Bonds. 

(c) Plain Bonds, Debentures, and Notes. 

(d) Income Bonds. 

(«) Equipment Trust Obligations, 

(/) Miscellaneous Funded Obligations. 

30. Receipts Outstanding for Funded Debt. 

31. Premium Realized on Funded Debt Sold. 

32. Receivers' Certificates. 

33. Obligations for Advances Received for Construction, 

Equipment, and Betterments. 

WORKING LIABILITIES: 

34. Loans and Bills Payable. 

35. Net TraflBc, Car Mileage, and Per Diem Balance. 

36. Audited Vouchers and Wages Unpaid. 

37. Miscellaneous Accounts Payable. 

38. Matured Dividends, Interest, and Rents Unpaid. 

39. Matured Mortgage, Bonded, and Secured Debt Unpaid. 

40. Working Advances Due to Other Companies. 

41. Other Working Liabilities. 

ACCRUED LIABILITIES NOT DUE: 

42. Dividends Declared and Interest and Rents Accrued, 

Not Due. 

43. Taxes Accrued. 

DEFERRED CREDIT ITEMS: 

44. Operating Reserves — 

(a) Reserves for Replacement of Property. 
(6) Reserves for Other Purposes. 

45. Liability on Account of Special Trust Funds. 

46. Items in Suspense. 

90303—09 3 




4 .r" 



/ 



48. 



18 

APPROPRIATED SURPLUS: 
47. Surplus Reserves — 

(a) Reserves Invested in Sinking and Redemption Funds. 

(b) Reserves Invested in Insurance and Other Special 

Funds. 

(c) Reserves Not Specifically Invested. 
Additions to Property through Income since June 30 1907 

FREE SURPLUS: 

49. Profit and Loss— Balance. 

XEXT EXPLAXATORY OF BALANCE SHEET 

ACCOUNTS. 

ASSETS. 
PROPERTY OWNED AS INVESTMENT. 
I. Physical Property Owned. 
1-A. Road and Equipment to June 30, 1907. 

This account should include the balances carried in the 
General Ledger showing the value of Road and Equipment 
as It stood on June 30, 1907, subdivided between (a) Road 
and (6) Equipment, when the subdivision can be accu- 
rately made. 

1-B. Road and Equipment since June 30, 1907. 

This account should include amounts expended and charged 
in accordance with the Classifications of Expenditures for 
Road and Equipment and Expenditures for Additions and 
Betterments since June 30, 1907. These amounts should be 
Bubclassified: (a) Road, (6) Equipment, (c) General Expend- 
itures. 

II. Securities Owned. 
2. Securities of Proprietary, AflSliated, and Controlled Com- 
panies—Pledged. 

This account should include the book value of securities 
of proprietary, affiliated, and controlled companies whose 
property is used by or forms a part of the railway system 
of the respondent company, which securities are pledged 
as collateral security for any of the respondent company's 
funded debt or other outstanding obligations. It should in- 
clude securities of union depot, terminal, bridge, ferry, and 







19 



similar companies owned by the respondent company and 
pledged to secure its outstanding obligations whep the prop- 
erty of those companies is used by the respondent company 
in the transaction of its own transportation business. 

Amounts reported in this account should be classified under 
the subheadings: (a) Stocks, (6) Funded Debt, (c) Miscel- 
laneous. 

See text of accounts Nos. 25 and 29 for description of items 
classed as "Capital Stock" and "Funded Debt." Among 
the items that should be cla^ised as "Miscellaneous" are 
receivers' certificates and demand or short-time notes issued 
by proprietary companies, which do not come within the 
character of obligations classed as funded debt. . 

3. Securities Issued or Assumed — Pledged. 

This account should include the book value of securities 
issued by the respondent company, and securities issued by 
other companies, payment having been assumed by the re- 
spondent company, which have been pledged as collateral 
for other securities issued by the respondent company. 

The par value of securities reported under this caption 
should be included in the amount of capital stock or funded 
debt of the respondent company under general account 
** Stock " or ''Mortgage, Bonded, and Secured Debt." 

Amounts reported under this caption should be classified 
under the subheadings: (a) Stocks, (6) Funded Debt, (c) Mis- 
cellaneous. 

See text of account No. 25, ''Capital Stock," and No. 29, 
"Funded Debt," for description of items classed under sub- 
headings (a) Stocks and (6) Funded Debt. Under subheading 
(c) Miscellaneous should be grouped the balances representing 
issued or assumed obligations (other than stocks, bonds, or 
certificates of indebtedness maturing more than one year after 
date of ist-ue) which are owned by the respondent company 
and pledged by it as collateral security. 

Note.— This account is not intended to cover securities guaranteed 
only. 

4. Securities of Proprietary, Afiiliated, and Controlled Com- 

panies—Unpledged . 

This account should include the book value of unpledged 
securities of proprietary, affiliated, or controlled companies 




mm 



Il 



20 



whose property is used by or forms a part of the railway 
system of the respondent company, the securities* being held 
for the purpose of preserving the integrity of the system. 
There should be included under this caption the book value 
of investments in the securities of union depot, terminal, 
bridge, ferry, and similar companies when the property of 
those companies is used by the respondent company in the 
transaction of its own transportation business and said securi- 
ties are in its treasury unpledged. 

Amounts reported in this account should be classified under 
the subheadings: (a) Stocks, (6) Funded Debt, (c) Miscel- 
laneous. 

See text of account No. 2 for description of items classed as 
Miscellaneous. 

Note.— This account Is not Intended to cover securities guaranteed 
only, or any deemed by the respondent company as "Marlcetable 
Securities." 

III. Investments. 

5. Advances to Proprietarj% Affiliated, and Controlled Com- 
panies for Construction, Equipment, and Betterments. 

Except as provided below, there should be included in this 
account all cash advances made to proprietary, affiliated, and 
controlled companies to enable said companies to pay for con- 
Btniction, equipment, and additions and betterments, which 
advances may be carried in open accounts by the respondent 
company. ^Tien the companies to which said advances are 
made issue notes or other securities to the rec^pondent com- 
pany for the payment of said advances, the cost of said notes 
or securities should be transferred from this account to account 
No. 2, if said securities are pledged as collateral for obligations 
issued, or to be issued, by the respondent company, or to 
account No. 4 if held unpledged. 

In case advances are made to proprietary, affiliated, or con- 
trolled companies for the purposes above mentioned, with the 
understanding and intention that the advances nhall be liqui- 
dated by the company to which made, either in cash realized 
from the issuance and sale of its own securities, or by the 
issuance of securities to the respondent company, which the 
latter may sell or hold in its treasury as free assets at its 




21 



pleasure, the amounts so advanced should be included in 
account No. 15, "Advances." 

. Other Permanent Investments. 

(a) Physical Property .—This account should include invest- 
ments in property not used for railway purposes or outside 
operations, such as coal and other mines, timber lands, saw- 
mills, hotels (not a part of the railway property) with their 
furniture and fittings, buildings and property used for com- 
mercial purposes; land scrip acquired for the purpose of 
locating upon and securing title to public lands; investments 
in property not used for railway purposes and for which no 
titles or securities for titles are held; and other property that 
has been acquired in anticipation of future necessity or use, 
but which is not at present a part of the carrier's property 
used in carrying on its transportation business or outside 
operations. 

(6) Securities. — This account should include investments in 
the securities of steamship lines, express companies, or other 
enterprises which it is necessary or desirable for the respond- 
ent company to control or to be interested in for the purpose of 
maintaining the integrity of its transportation system, pro- 
vided such securities be not considered "Marketable Securi- 
ties" (account No. 8). This account should also include 
securities, not provided for in accounts Nos. 2, 3, and 4, that 
may be pledged in connection with mortgage, bonded, and 
secured debt (see accounts Nos. 29 and 33); also memberships 
in boards of trade and other conunercial organizations when 
such memberships have a permanent value. 



WORKING ASSETS. 
7. Cash. 




8 



This account should include current funds in the hands of 
financial officers and agents, deposits in banks or trust com- 
panies available for use on demand, including deposits to pay 
declared dividends or matured coupons, and cash in transit 
for which agents and conductors receive current credit. 
Marketable Securities. 

This account should include the cost or book value of ail 
securities which arie held in the company's treasury unpledged 
and free for sale and which it is not necessary or desirable for 



ui^ 



22 



the respondent company to hold for the purpose of maintaining 
the integrity of its railway system. Such securities should be 
subdivided to show: 

A. Securities held in the treasury of the respondent com- 
pany, whether securities of its own issue or securities the pay- 
ment of which it has assumed. 

B. Other securities. 

These securities should be further classified as stocks, funded 
debt, and miscellaneous. 

Note.— The par value of securiUes entered under A should be 
Included under accounts Nos. 25 and 2», "Capital Stock" and "Funded 
Debt." 

9. Loans and Bills Receivable. 

This account should include the book value of all collectible 
obligations in the form of loans and bills receivable or other 
similar evidences of money receivable on demand or within 
a time not exceeding one year. 

Note.— This does not Include time loans which mature more than 
one year after date of Issue, considered as investments, or loans to 
proprietary, affiliated, or controUed companies, such as are described 
under accounts Nos. 5 and 15a. 

10. Net Traffic, Car Mileage, and Per Diem Balance. 

This account should include the net amounts due from 
other companies on account of interline freight and ticket 
balances and balances resulting from the interchange of cars 
on a per diem or a mileage basis. Amounts due to the owners 
of private cars for per diem or mileage on cars should be con- 
sidered the same as amounts due to other railway companies. 

11. Net Balance Due from Agents and Conductora. 

This account should include the net balance due in current 
accounts from agents, and train, sleeping-car, and dining-car 
conductors, train auditors, porters, and others. Amounts 
advanced to general and special agents as working funds should 
not be included. 

12. Miscellaneous Accounts Receivable: 

This account should include amounts due for audited 
accounts, such as those due from the United States or other 
governments for transportation of mails and government pro- 
perty, and from express companies for express facilities fur- 
nished under contract; miscellaneous bills against other 



23 



railway companies, corporations, firms, and individuals; 
ground rents collectible; interest collectible on bills and ac- 
counts receivable, and on mortgages, deposits, and securities; 
and other similar items. 

Note.— The amount to be reported under this account Is not the 
net balance between accounts Nos. 12 and 37. 

13. Materials and Supplies. 

This account should include the balances representing the 
value of all unapplied material, and the value of material 
temporarily in use and not charged out, such as articles in 
process of manufacture by the company; telegraph and tele- 
phone material; fuel; stationery; dining-car supplies, etc. 

14. Other Working Assets. 

This account should include items of working assets not 
covered by accounts Nos. 7 to 13, inclusive. It is intended 
to include asset items that have not reached the stage of 
audited accounts properly classed under account No. 12, 
** Miscellaneous Accounts Receivable," and yet have been 
advanced beyond the stage of accounts properly classed under 
account No. 23, * ' Items in Suspense. ' ' This account includes 
such items as fines imposed by postal authorities in process 
of collection from parties at fault; amounts due from other 
roads for mileage or tickets honored for which reports or 
accounts have not been rendered or received; advanced 
charges billed out on waybills not reported received at the 
end of the month, and similar items. 

DEFERRED DEBIT ITEMS. 

15. Advances. 

(a) Advaruxs to Proprietary, Affiliated, and Corw-olled Com- 
panies.— This account should include amounts advanced to 
proprietary and subsidiary companies for purposes other than 
construction, purchase of equipment, or additions and better- 
ments, as provided for in account No. 5. It should include 
advances on open accoimt for the purpose of paying interest 
on the funded debt of proprietary or subsidiary companies, 
deficits resulting from the operations of such companies, and 
other advances not to be included in capital account and 
not represented by the physical property of said proprietary 
or subsidiary companies. 




i 



I 



24 

There should also be included in this subdivision amounts 
advanced to proprietary, affiliated, or controlled companies 
to enable such companies to pay construction, equipment, 
and additions and betterments expenditures when it is the 
understanding or intention that the advances shall be liqui- 
dated by the company to which made, either in cash realized 
from the issuance and sale of its securities, or by the issuance 
of its securities to the company making the advances, which 
securities the latter company may sell or hold in its treasury 
as free assets at its pleasure, it being considered not necessary 
that the company receiving said securities shall hold them 
for the purpose of maintaining the integrity of its railway sys- 
tem. (See accounts Noe. 2, 3, and 4.) 

(6) Working Funds. — ^This account should include amounts 
advanced to general and special agents, officers and employees 
of the engineering department, and other officers and employ- 
ees as working funds from which certain expenditures are to 
be made and accounted for by the persons to whom the advances 
are made. It also includes advances to fast freight lines and 
union depot and other terminal companies as working funds 
to be used in paying the current expenses of such companies 
in advance of regular monthly settlements. 

(c) Other Advances.— Thia account should include other 
advances not properly classified under (a) and (6) above or 
under account No. 6, "Advances to Proprietary, Affiliated, 
and Controlled Companies for Construction, Equipment, and 
Betterments." 

16. Insurance Premiums Paid in Advance. 

This account should include the debit balances representing 
premiums paid in advance for fire, boiler, accident, plate 
glass, liability, and kindred insurance, to be absorbed by 
monthly chaiges to operating expenses and outside operations 
during the term of the insurance. 

17. Taxes Paid in Advance. 

This account should include the excess of taxes paid over 
the proportion accrued against the income of the period covered, 

18. Discount on Securities Issued. 

(a) IXscount on Stock.—When stocks, included under 
account No. 25 at theif par value, are issued or sold at a dis- 
count, the discount should be reported in this account and, if 
the stock is not to be retired or converted, carried on the 



J^, 



n^ 



25 



balance sheet permanently or until extinguished by premiums 
realized on subsequent sales of the same class of stock. If the 
stock is to be retired or converted, the discount should be 
charged to Profit and Loss or against the premium realized, 
if any, at the date of such retirement or conversion. 

If the premium in account No. 28, "Premium Realized on 
Capital Stock Sold," is less in amount than the discount 
included in this account, it should be deducted herefrom and 
the net amount included in this accoimt. If the premium 
in account No. 28 is greater than the discoimt charged in this 
account, the discount should be deducted therefrom and the 
difference included in account No. 28. 

(6) Discount on Funded Debt. — \Vhen bonds are issued or 
sold at a discount they should be included in account No. 29, 
"Funded Debt," at their par value. The discount should be 
charged to Income in such equal annual installments during 
the life of the bonds as will extinguish the discount. The 
carrier may, however, at its option, charge to Profit and Loss 
all of the discount or any part of it remaining at any time 
unextinguished; but the charge to Income in any one year 
must not exceed the amount of the annual installment appli- 
cable to that year. The discount remaining unextinguished 
should be included in this account. 

If the premium in account No. 31, "Premium Realized on 
Funded Debt Sold," is less in amount than the discount in- 
cluded in this account, it should be deducted herefrom and 
the net amount reported in this account. If the premium in 
account No. 31 is greater than the discount charged in this 
account, the discount should be deducted from the premium 
and the difference included in account No. 31. 

19. Property Abandoned, Chargeable to Operating Expenses. 

This account is intended as a suspense account to which may 
be chaiged certain costs representing important pieces of prop- 
erty abandoned in the course of improvement or betterment 
work when the cost of such property would, if included in the 
operating expenses for a single year, unduly burden such ac- 
counts for that year. It is to be used only after permission of 
the Interstate Commerce Commission has been asked and given 
and is not to be applied to lands abandoned or equipment re- 
tired from service. Amounts included herein are to be redis- 
tributed to operating expenses through a period of years, the 






27 






number of which will be determined when permiaeion to use 
the account is granted. 

To this account may be charged the cost, lees salvage, of re- 
placing in kind any of the following property: Station build- 
ings, enginehouses, turntables, shop buildings, and terminal 
yards, including buildings and other structures therein, re- 
moved or abandoned in the course of replacing them with im- 
proved structures or facilities; bridges and trestles abandoned 
by reason of replacing them with structures of greater capacity 
or permanency; interlocking apparatus abandoned in the 
course of eliminating grade crossings or of other improvements; 
block and other signal apparatus replaced with improved appa- 
ratus; and fuel stations, grain elevators, storage warehouses, 
docks, wharves, light and power plants, and all other important 
miscellaneous structures abandoned in the couree of replacing 
them with enlarged or improved property. 

To this account may also be charged the cost, less salvage, 
of main line and sidings, including track material abandoned 
by r^iaon of change of line or location ; and the cost, less salvage, 
of rails, track fastenings, and frogs and switches released from 
track on account of relaying with heavier rails. For the pur- 
poses of this account the cost of replacing rails, track fastenings, 
and frogs and switches should be computed upon the basis of 
the cost of replacing the original weight of the rails, track 
fastenings, and frogs and switches, at the price per ton paid 
for the material put in anew. 

This account may also include the cost of removing old mate- 
rial and all other incidental expenses directly connected with 
the abandonment of property the cost of which is included in 
this account. 

Note A.-The amount charged to this account for property aban- 
doned should be concurrently credited to the appropriate accounts 
under Additions and Betterments. 

HoTB B.— The phnse "unduly burden such accounts," used above, 
should not be interpretej as meaning that a carrier is at liberty to 
make charges for abandoned property directly to Operating Expenses, 
or to Operating Expenses through the account " Property Abandoned, 
Chargeable to Operating Expenses," in view of its financial ability to 
make such charges directly in one year and its inability to make such 
charges in another year. It shouU be l^membered that the charges 
Included in Operating Expenses are designed to cover the current 
cost of maintaining and operating the property, and that the Property 
Abandoned accounts are designed to cover any unusual expenditures 
from year to year. 



f 



s 



20. Cash and Securities in Sinking and Redemption Funds. 
This account should include the amount of cash and the cost 

or book value of live securities in the hands of trustees of sink- 
ing and other funds for the purpose of redeeming outstanding 
obligations. Any live securities of the respondent company 
held by such trustees should be included in the amounts re- 
ported under the appropriate subheadings of account No. 25, 
* ' Capital Stock, ' ' or account No. 29, " Funded Debt. ' ' 

21. Cash and Securities in Insurance and Other Special Funds. 
This account should include the ledger balances covering 

the amount of cash and the cost of securities in the hands of 
trustees or managers of insurance funds, pension funds, and 
other funds that have been raised by the carrier for specific 
purposes (except special trust fimds and sinking funds for the 
retirement of obligations). The amount reported in this ac- 
count should agree with the amoimt reported in account 
No. 476, " Reserves Invested in Other Special Funds." 

22. Cash and Securities in Special Trust Funds. 

This account should include the ledger balances covering 
the amount of cash and the cost of securities in the hands of 
trustees or managers of employees' savings funds, relief, hos- 
pital, and other association funds when such trustees or man- 
agers are acting for the carrier in the administration of such 
funds. If such funds are held in the carrier's treasury not 
invested and unidentified they should be included in account 
No. 7, "Cash." The amount reported in this account should 
agree with the amount reported in account No. 45, "Lia- 
bility on Accoimt of Special Trust Funds." 

23. Items in Suspense. 

In this account should be included suspense accounts 
showing debit balances that can not be entirely cleared and 
disposed of until additional information is received, such as 
freight claims paid when found to be correct but in advance 
of investigation with other carriers; charges for work done or 
materials furnished for which bills have not been received from 
the proper departments; items awaiting adjustment between 
accounts, such as cost of work done in advance of receipt of 
proper authority or appropriation; accounts covering the cost 
of operation of gravel pits and quarries to be apportioned on 
output; debit balances in "Shop Expense" and "Store Ex- 



28 



-»» 



pense accounts; also accounts to be spread over a stated 
term not provided for in account No. 18 or elsewhere; and 
debit balances in operating reserve accounts to be cleared 
by future charges to operating expenses. 



DEFICIT. 



24. Profit and Loss — Balance. 

In case the debit balance in the Profit and Loss Account is 
less than the total of accounts Noe. 47 and 48, under the cap- 
tion * 'Appropriated Surplus," the amounts of these accounts 
ehould be stated in short column on the credit side of the bal- 
ance sheet and the total brought down . From this total should 
be deducted the Profit and Loss debit balance and the net 
amount remaining should be extended as " Profit and Loss- 
Balance" under "Free Surplus." If, however, the debit 
balance of the Profit and Loss Account is in excess of the total 
of accounts Nos. 47 and 48 the amount of these accounts should 
be stated in short column on the debit side of the balance 
sheet and the total deducted from the Profit and Loss debit 
balance, the difference being shown as "Profit and Loss — Bal- 
ance ' ' under ' ' Deficit . ' ' 



LXABILITIES. 



STOCK: 



;;: 



25. Capital Stock. 

In this account should be entered the full amount of the 
capital stock issued and outstanding, whether all or any part 
of same is held by the public, by other railway companies, in 
the company's treasury, pledged or unpledged, or by the trus- 
tees of sinking or other funds for the redemption of outstanding 
obligations, or for other special purposes. The amounts en- 
tered in this account should be subdivided as follows: 

(a) Common Stock. — The par value of common stock issued 
and outstanding. 

(ft) Preferred Stock. — The par value of first, second, or other 
preferred stock issued and outstanding. 

(c) Debentvre Stock. — The par value of debenture stock issued 
and outstanding. 

Note.— Capital stock is considered as "issued" when certificates are 
signed, sealed, and placed witli the proper officer for sale and delivery. 
All capital stock issaed ani not canceled is considered to be "out- 
standing." 



29 

26. Receipts Outstanding for Capital Stock. 

When capital stock is sold, to be paid ior in installments, 
the amounts received in such installments should be included 
in this account. When such stock has been paid for in full, 
and the receipts given for the installments paid are sur- 
rendered in exchange for regular stock certificates, the par 
value should be included under the appropriate subdivision 
of account No. 25, "Capital Stock." The premium, if any, 
realized on such capical stock should be disposed of as pro- 
vided in the text of account No. 28, "Premium Realized 
on Capital Stock Sold," while the discount, if any, should be 
disposed of as provided in the text of account No. 18a, " Dis- 
count on Stock." 

27. Stock Liability for Conversion of Outstanding Securities 

of Constituent Companies. 

This account should include the company's liability under 
agreements to exchange its capital stock for the outstanding 
securities of constituent companies whose physical property 
has been acquired under such agreements, but whose secur- 
ities have not yet been surrendered for exchange. 

28. Premium Realized on Capital Stock Sold. 

When stocks, included in account No. 25, "Capital Stock," 
at their par value, are issued or sold at a premium, the premium 
realized should be reported in this account and, if the stock is 
not to be retired or converted, carried on the balance sheet 
permanently or until extinguished by discounts on subsequent 
sales of the same class of stock. If the stock is to be retired 
or converted, the premium should be either credited to Profit 
and Loss or against the discount, if any, suffered at the 
date of such retirement or conversion. 

If the discount in account No. 18a, "Discount on Stock," is 
less in amount than the premium included in this account, 
it should be deducted herefrom and the net amount included 
in this account. If the discount in account No. 18a is greater 
than the premium credited in this account, the premium 
should be deducted therefrom and the difference included in 
accoimt No. 18a. 

MORTGAGE, BONDED, AND SECURED DEBT. 

29. Funded Debt. 

There should be entered in this account the full amount of 
funded debt issued by the respondent company and outstand- 



30 



31 



ing, or issued by other compaDies and outstanding when 
the payment of such securities has been assumed by the re- 
spondent company, whether all or any portion of said funded 
debt is held by the public, by other railway companies, in 
the company's treasury, pledged or unpledged, held un- 
canceled by the trustees of sinking funds to retire outstand- 
ing obligations issued or assumed by the respondent company, 
or held by the trustees of any other special funds created for 
the benefit of the respondent company. 

The amounts included in this account should be subdivided 
as follows: 

(a) Mortgaffe Bonds.— Bonds secured by a lien on the prop- 
erty of the company, except as provided in the other sub- 
divisions of this account. 

(6) Collateral Trust Bond!*.— Bonds secured by lien on securi- 
ties or other commercial paper. Stock trust certificates that 
are similar in character to collateral trust bonds should be 
included under this heading, as should also short-time col- 
lateral trust notes. 

(c) Plain Bonds, Debentures, and iVb<««.— Unsecured certifi- 
cates of indebtedness. Short-time notes (having a life of one 
year or less) given in payment of temporary indebtedness 
should not be included under this heading. Short-time notes 
secured by collateral should be classed with collateral trust 
bonds. Debentures should be clearly distinguished from 
debenture stock. 

(d) Income Bonds.—Bonds which are a lien on a carrier's 
revenue alone, or bonds which, while being a lien on its road 
and franchises, can claim payment of interest only in case 
interest is earned. 

(e) Equipment Trust Obligations. —Equipment bonds, equip- 
ment notes, or car trust notes secured by a lien on specific 
equipment, such lien having been created in connection with 
the acquisition of the equipment securing the obligation. 

(/) Miscellaneous Funded Obligations.— AW other funded 
obligations not provided for by the other subdivisions of 
this account, including real-estate mortgages executed or as- 
sumed by a carrier, and other similar obligations. 

Note A.— Jonds are considered "issued " when they are certified by 
tnistees and placed with the proper officer for sale and delivery. 
" Outstanding bonds " include all bonds issued and not canceled. 

Note B.— This account is not intended to cover securities when th« 
ptvment ot either principal or interwt has been guaranteed only. 



\ 
4r. 



\^.-l 



30. Receipts Outstanding for Funded Debt, 

When funded debt is sold, to be pwiid for in installments, the 
amounts received in such installments should be included in 
this account. Upon final payment of purchase price and the 
surrender of receipts given for the installments paid in ex- 
change for the regular securities, the par value of the funded 
debt so issued should be transferred to the proper subdivision 
of account No. 29, "Funded Debt." The premium realized, 
if any, should be disposed of as provided in the text of ac- 
count No. 31, "Premium Realized on Funded Debt Sold," 
while the discount, if any, should be disposed of as provided 
in the text of account No. 186, "Discount on Funded Debt," 

31. Premium Realized on Funded Debt Sold. 

When bonds are issued or sold at a premium, they should be 
included under account No. 29, "Funded Debt," at their par 
value. The premium should be credited to Income in such 
equal annual installments during the life of the bond as will 
extinguish the premium . A carrier may, however, at its option, 
credit to Profit and Loss such premium or any part of it at 
any time unextinguished; but the credit to Income in any 
one year must not exceed the amount of the annual installment 
applicable to that period. The premium remaining unex- 
tinguished should be reported in this account. 

If the discount in account No. 186, "Discount on Funded 
Debt," is less in amount than the premium included in 
this account, it should be deducted herefrom and the net 
amount included in this account. If the discount in account 
No. 186 is greater than the premium credited in this account, 
the premium should be deducted from the discount and the 
difference included in account No. 186. 

32. Receivers' Certificates. 

This account should include the par value of outstanding 
certificates, notes, or other obligations issued by receivers in 
charge of and operating the property of a carrier, and the par 
value of certificates, notes, or other obligations issued by 
receivers and assumed upon reorganization. 

33. Obligations for Advances Received for Construction, 

Equipment, and Betterments. 

Proprietary, affiliated, and controlled companies should 
show in this account the amounts advanced to them for 



32 



33 



constniction, equipment, and additions and betterments ex- 
penditures. These amounts, if advanced by another carrier, 
should be reported by it in account No. 5, "Advances to 
Proprietary, Affiliated, and Controlled Companies for Construc- 
tion, Equipment, and Betterments. '' 

WORKING LIABILITIES. 

34. Loans and Bills Payable. 

This account should include the balances representing obli- 
gations outstanding in the form of loans and bills payable or 
other similar evidences of money borrowed, payable on 
demand or within a time not exceeding one year, which are 
not properly classed under account No. 29, "Funded Debt." 

35. Net Traffic, Car Mileage, and Per Diem Balance. 

This account should include the net amounts due to other 
companies on account of interline freight and ticket balances 
and balances resulting from interchange of cars on a per diem 
or a mileage basis. Amounts due to the owners of private 
cars for per diem or mileage on cars should be considered the 
same as amounts due to other railway companies. 

36. Audited Vouchers and Wages Unpaid. 

This account should include the amount of audited vouchers 
or accounts and audited pay rolls unpaid on the date of the 
balance sheet. It should include unclaimed wages and out- 
standing pay and time or discharge checks issued in payment 
of wages. 

37. Miscellaneous Accounts Payable. 

There should be included in this account unpaid and out- 
standing drafts drawn by station agents, unpaid and outstand- 
ing drafts drawn on the company in settlement of freight 
claims, conductors' rebate and extra-fare checks not presented 
for redemption, meal checks and tickets outstanding, deposits 
of controlled companies, and other items of the nature of 
demand liabilities not covered by accounts Nos. 34, 35, 36, 
38, and 39. 

Note.— The amount to be reported under this account Is not the net 
halanoe between accounts Nos. 12 and 37. 

38. Matured Dividends, Interest, and Rents Unpaid. 

This account should include the amount of dividends pay- 
able on capital stock and unpaid, uncalled for, or unclaimed 
at the date of the balance sheet, including dividends payable 



\ 




on the first day of the month following that for which the 
balance sheet is made; the amount of matured and unpaid 
interest on the funded debt of the respondent company, 
and of other companies when payment has been assumed by 
the respondent company, including interest which matures 
on the first day of the month following that for which the 
balance sheet is made; unpaid dividends on the stock and 
impaid interest on the funded debt of other companies when 
same are payable by the respondent company as all or a 
portion of the rent due under leases; and all other rents due 
imdor leaees which have become payable. 

39. Matured Mortgage, Bonded, and Secured Debt Unpaid. 

This account should include the amount of matured mort- 
gage, bonded, and secured debt payable but not yet paid, 
including bonds drawn for redemption through the operation 
of sinking and redemption fund agreements. Obligations 
which mature on the first day of the month following that for 
which the balance sheet is made should be included in this 
account. 

40. Working Advances Due to Other Companies. 

Proprietary, affiliated, and controlled companies should 
include in this account the amounts advanced to them for 
general purposes, such as advances to pay interest on their 
funded debt not included in account No. 33, "Obligations for 
Advances Received for Construction, Equipment, and Better- 
ments," deficits resulting from their operation, and advances 
for construction, equipment, and additions and betterments, 
when such advances are made under the conditions stated in 
account No. 15a, "Advances to Proprietary, Affiliated, and 
Controlled Companies," and when that account is used to 
report the advances by the company making them. 

41. Other Working Liabilities. 

This account should include items of working liabilities not 
covered by accounts Nos. 34 to 40, inclusive. It should 
include liability items that have not reached the stage of 
audited liabilities and become actually payable, yet are obli- 
gations of the company and advanced beyond the stage of 
accounts properly classed under account No. 46, "Items in 
Suspense," such as retained percentages due contractors to be 
paid on completion of contracts; deposits for construction of 



34 



35 



i 



side tracks, to be refunded on the basis of an agreed percentage 
of the earnings from the traffic handled over the tracks; pre- 
paid charge? billed out on waybills not taken into the month's 
accounts; and other similar items. It should include also 
balances to the credit of employees* savings funds, and relief, 
hospital, and other association funds when such funds are held 
unidentified iii the carrier's treasury and are included in 
account No. 7, 'Cash." 

ACCRUED LIABILITIES NOT DUE. 

42. Dividends Declared and Interest and Rents Accrued, Not 

Due. 
This account should include the amount of dividends on 
capital stock, interest on funded debt, including interest on 
funded debt assumed, and rents under leases, accrued to the 
date for which the balance sheet is made but not payable 
until after the first day of the following month. There should 
be included also as "rents accrued " the amount of accrued 
dividends on the stock and accrued interest on the funded 
debt of other companies when such dividends and interest 
are paid as all or a portion of the rent under leases from tho-e 
companies. 

43. Taxes Accrued. 

This account should include the amount of taxes accrued and 
charged s^ainst income in excess of the amount paid. WTien 
the respondent company leasej the property of another com- 
pany and, under the terms of the lease, agrees to pay or assume 
the taxes that may be levied upon or assessed against such 
property, the taxes accrued on such property should be in- 
cluded in this account and not in account No. 42. When, 
however, the taxes are paid by the lessor company, the full 
amount of cash rent to be paid by the lessee should be 
included in account No. 42. 

DEFERRED CREDIT ITEMS. 

44. Operating Reserves. 

This account should include the ledger balances in the 
reservei created to cover past depreciation of property; 
reservej created since July 1, 1907, by charge i to Operating 
Expenses to cover accrued depreciation of equipment and of 
way and structures when a plan for such purpose has been 



v^ 



i 



adopted by the carrier; reserves created by charges to Oper- 
ating Revenues or to Operating Expenses to provide for over- 
charge, personal injury, insurance, and other claims; and 
similar reserves. The credits in this account should be sub- 
divided as follows: 

(a) Reserves for Replacement of Property. 

(6) Reserves for Other Purposes. 

The credit balance in sinking fund reserve account should 
not be included in this account. See account No. 47a, "Re- 
serves Invested in Sinking and Redemption Funds." 

45. Liability on Account of Special Trust Funds. 

This account should include the ledger balances covering 
the amount of cash and the cost of securities in the hands of 
trustees or managers of employees' savings fimds, relief, hos- 
pital, and other association funds, when such trustees or 
managers are acting for the carrier in the administration of 
such funds. The amount reported in this account should 
agree with the amount reported in account No. 22, "Cash and 
Securities in Special Trust Funds." 

46. Items in Suspense. 

Under this caption should be included suspense accounts 
showing credit balances that can not be entirely cleared and 
disposed of until additional information is received, such as 
collections by general agents and others to cover prepayment 
of shipments originating on lines of other carriers; amounts 
realized from sale of damaged, unclaimed, and over freight 
and held pending claim; switching charges of other carriers 
collected and held awaiting bills from such carriers; amounts 
received from sale of mileage tickets to be disposed of as 
mileage is honored by the respondent or other carriers; amounts 
collected for milling-in-transit privileges, to be cleared when 
products are shipped; credit balances in "Shop Expense" 
and "Store Expense" accounts; and other similar items. 

APPROPRIATED SURPLUS. 

47. Surplus Reserves. 

In this account should be grouped all appropriations of sur- 
plus (except as covered by account No. 48), including unex- 
pended balances of appropriations for additions and better- 
ments. The account should be subdivided under the following 
heads: 



36 

(a) Reserves Invested in Sinking and Redemption Funds. 

Amounts charged against Income Account for sinking fund 
payments; accretions to sinking funds in the hands of trustees; 
also amounts realized and turned over to sinking fund trustees 
or used in the purchase of outstanding obligations either by 
sinking fund trustees or by the respondent company, when 
such sums are realized from other sources than the company's 
income. All credits to this account to cover amounts turned 
over to sinking fund trustees, and all accretions to sinking funds 
collected by trustees, should be debited to the account with 
such trustees in account No. 20. 

(6) Reserves Invested in Other Special Funds. 

(c) Reserves Not Specifically Invested. 

4S. Additions to Property through Income since June 30, 1907. 

This account should include the cost of property acquired 
by expenditures of appropriations from Income since June 30, 
1907, whether such expenditures are for new lines or for addi- 
tions and betterments to existing lines. The amount standing 
to the credit of this account should be included in the amount 
reported under account No. 1-B, "Road and Equipment since 
June 30, 1907." 

FREE SURPLUS. 

' 49. Profit and Loss — Balance. 

This account should include the balance, if any, standing 
to the credit of the Profit and Loss Account. 

Wlien there is a debit balance in the Profit and Loss 
Account, but such balance does not exceed the total credit 
balance of accounts Nos. 47 and 48, the latter are to be stated 
in short column, the total brought down, and the debit balance 
of account No. 49 deducted therefrom, the difference being 
extended to the total column as the net appropriated surplus. 
WTien the debit balance standing in account No.. 49 exceeds 
the total credit balance of accounts Nos. 47 and 48, the ac- 
counts are to be stated as prescribed in the text of account 
No. 24. 

o 






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MAY 2 7 1927 



END OF 

TITLE