ABSTRACT
The investments heretofore considered are interest bearing, but bear no premium or discount; the variation from time to time is in the rate of interest, while the principal is invariable. The original cost and the par are the extremes: one at the beginning, and one at the end of the investment. In case of an additional purchase the account will, of course, be debited and cash credited. It will then be necessary to reconstruct the schedule from that point on. The resultant will show a gain or loss on the sale, and at the balancing date the account will be closed into Profit and Loss. To adjust the profit on the Bond account itself would be as unphilosophical as old-fashioned Merchandise account before Sales account was introduced, and even more awkward. The Register of Interest Due on Bonds is conducted on precisely the same principles as that described for Mortgages; in fact, they are but sub-divisions of same Register.
