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   T.  All right enough; now tell me, please, on what ruling principle is the system of double entry based.
   P.  The ruling principle of double entry is, that to each debit or credit entry in one account, an entry for the same amount should correspond in the opposite column of another account, so that the two entries should balance each other.
   T. This is not very easy to understand, uhless you explain how it is to be done.
   P.  So it is; I forgot to say that in the double entry; system not only buyers and sellers, but fibtitious concerns (i) also, such as: capital, cash, goods (2), bills payable (3), bills receivable (4), profits and losses etc. must have each a separate account, as if they were persons acting on behalf of the merchant; in which
   (1) Fictitious concerni  letteralmente vale « enti fittici» che tecnicamente diconsi «enti contabili».
   (2) Goods è termine generico equivalente a « merci» e può essere usato tanto in senso generale che in senso limitato, mentre il suo sinonimo merchandise non può essere usato che in senso generale indefinito.
   (3) Bills payable  « Effetti a pagare », cioè cambiali
   che la casa deve pagare.
   (4) Bills receivable  « Effetti ad esi'ere», cioè cambiali che la casa deve esigere.
   MÉHMaoKia» tfwwr, a «ws
   account what is parted with by the concern must appear as a credit, and what is received as a debit.
   Now, since any operation effected by the noiise is actually transacted between two of the said persons or concerns, the same amount is to be charged to one account and credited to another, the two entries thus balancing each other, as I formerly said.
   T.  Would you give us a pratical example of such a proceeding? __ __  %
   P.  I shall try to do so by dealing with I very simple cases.  Suppose one buys fe'Is of a merchant for cash (1),  The inods account of the buyer will then have to je debited tor the amount, because the goods lave been received, and the Cash account will Jave to be credited, because the money has been paid.  On the contrary: one sells goods to a party, who pays by means of a promissory note. The Goods account of the seller shall then be credited, because the goods went out, while the Bills receivable account shall be debited; and, on the said note being paid on maturity, the Bills receivable shall have to be credited, and the Cash account to be debited, because the latter received the money.
   (I) Le locuzioni «forcasti», « by cash», o anche soltanto «cash» corrispondono a « a contanti».