The abstract of the profit and loss account may be made out in the following form:

At the end of the year the final balance of the profit and loss account is transferred to other accounts according to the purposes to which it is to be applied. If intended to be held as a "surplus fund," it is transferred to that account. If intended to be divided among the proprietors, it is transferred to a "dividend account," which is raised for that purpose. If the balance of the profit and loss account should be against the bank, then it must remain "on the wrong side" until further profits shall turn the balance the other way.

Besides the books connected with the business of banking, every Joint Stock Bank will require,

1. A SHAREHOLDER'S-REGISTER.-In this book the names of the shareholders are entered chronologically in the order in which they become shareholders. The entry includes the date, the name, residence, number of shares, and sum paid.

2. TRANSFER-REGISTER.-In this book are entered the transfer of shares from one proprietor to another.

The entry includes date of transfer, from whom transferred, residence, ledger-folio, to whom transferred, residence, purchase-money, transfer stamp.

If a proprietor in a Joint Stock bank wishes to dispose of his shares, he directs a stock-broker to sell them in the market. After the sale the broker gives notice to the directors of the bank in the following form:

London, the

To the Directors of

Day of
Banking Company.

183

Gentlemen,

Please to prepare the necessary document for transferring
Shares, from the Name of

Shares is £

of

The deed of transfer is then made out according to a printed form prepared by the bank. This agreement is liable to a stamp duty, varying according to the amount of the purchase money. When shares are transferred for a nominal consideration, say five or ten shillings, the stamp duty is thirty shillings.

The following is the scale of stamp duties upon the transfer of shares in Joint Stock Banks.

When the purchase money is under £20

£0 10

For £20 and under

50

1 0

The bank charges a fee of one shilling per share upon five shares or above for making the transfer, and two shillings and sixpence per share for any number less than five shares. Where there is no pecuniary consideration the charge is ten shillings for each transfer.

3. PROPRIETORS'-LEDGER.-In this Ledger each proprietor has an account open in the same way as in a Cash-Ledger. He is credited for the number of shares; and an entry is made of the different instalments he may pay. When he sells or transfers his shares, he is debited the shares, and they are placed to the credit of the party who may have purchased them. The entry includes the date, number of register, calls and transfers, number of shares and amount.

SECTION IV.

BANKING CALCULATIONS.

When a bill is discounted, the party is credited for the full amount, and debited for the interest. The interest is calculated from the day on which the bill is discounted to the time it falls due. The shortest way is to make use of an interest-book, but if it be done with the pen the following rule may be useful. Multiply the amount of the bill by the number of days. To the product add one-third of itself, one-tenth of that third, and one-tenth of that tenth. From the total strike off four figures to the right for decimals. This will give the interest at 5 per cent. in pounds and decimal parts of a pound. The decimals are to be brought into shillings and pence, by multiplying by twenty and twelve. The interest of any sum at a different rate per cent. may be found in the same way, if you multiply the principal by twice the rate of

interest, and strike off five figures for decimals instead of four.-Example: It is required to find the interest of £500 for ninety days at 5 and 3 per cent.

It must be observed, however, that this method of calculation is not exactly correct, it produces nearly a farthing too much on every £10 of interest; in calculating large sums therefore, the amount of these farthings must be deducted.

This mode of calculation is founded upon the rule that whenever you have to divide by any number under 100, you may divide by 100; after having added to the dividend such a proportion of itself, as the difference between the divisor and 100 bears to the divisor, the result will be the same as though you had divided in the usual way. This rule is best explained by an example.

Suppose you have to divide 2500 by 40. Now if 40 be subtracted from 100, there will remain 60. The proportion which 60 bears to 40 is 14. If then you add to the dividend 14 times itself, and divide by 100, you have the quotient required: thus-.

Now then, to find the interest upon any sum for one day you may divide by 7300, or striking off the ciphers by 73. The number required to make up 100 is 27. What is the proportion between 27 and 73? If you take the third of 73, a tenth of that third, and a tenth of that tenth, you have something more than 27. And if you add to 73 one-third of itself, one-tenth of that third, and one-tenth of that tenth, you will have 1001, which divided by 100 will give 10,000. As the proportion is not exact, the interest given by the above rule will always be 10th part too much, which is about a farthing in every £10 interest.

10,000th

In taking the interest for any number of months, it will be useful to remember that the interest of one pound for one month at 5 per cent. is one penny. Thus the interest of £100 for two months is twice a hundred pence or sixteen shillings and eight-pence. The interest upon shillings and pence is never taken into the account. If the fraction is more than ten shillings, it is regarded as £1; and if it be less, it is not noticed.

The interest for any number of months, at any rate per cent. may be found by multiplying the number of months by the rate of interest: with this sum divide 1,200. By this quotient divide the principal, and you have the interest required. Example-What is the interest of £10,000, at 4 per cent. for three months? 4 multiplied by 3 gives 12-divide 1,200 by 12, and you have 100; then divide 10,000 by 100, and you have £100, the interest required.

There is often a difference in the amount of interest according to the method of calculation, either by months or by days. A month from the 10th of February to the 10th of March, is only 28 days; but from the 10th of March to the 10th of April, a month is 31 days. The half year from the 1st of January to the 30th of June, is 181 days; but from the 1st of July to the 31st of December, the half year is 184 days. The interest of £10,000 for 6 months is 250; for