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Copyright 2018 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203
Copyright 2018 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203
 Brief Contents

Chapter 1 Introduction to Accounting and Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Chapter 2 Analyzing Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Chapter 3 The Adjusting Process. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
Chapter 4 Completing the Accounting Cycle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160
Chapter 5 Accounting Systems. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 230
Chapter 6 Accounting for Merchandising Businesses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 280
Chapter 7 Inventories. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 344
Chapter 8 Internal Control and Cash. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 394
Chapter 9 Receivables. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 440
Chapter 10 Long-Term Assets: Fixed and Intangible. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 486
Chapter 11 Current Liabilities and Payroll. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 536
Chapter 12 Accounting for Partnerships and Limited Liability Companies . . . . . . . . . . . . . . . . . . . . . . . . 584
Chapter 13 Corporations: Organization, Stock Transactions, and Dividends. . . . . . . . . . . . . . . . . . . . . . . 628
Chapter 14 Long-Term Liabilities: Bonds and Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 675
Chapter 15 Investments and Fair Value Accounting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 719
Chapter 16 Statement of Cash Flows. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 765
Chapter 17 FInancial Statement Analysis. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 823
Mornin’ Joe. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MJ-1
Appendix A Interest Tables. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
Appendix B International Financial Reporting Standards (IFRS). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1
Appendix C Revenue Recognition. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-1
Appendix D Nike Inc., Form 10-K for the Fiscal Year Ended May 31, 2016 . . . . . . . . . . . . . . . . . . . . . . . . . . D-1
Glossary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . G-1
Index. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1

v
Copyright 2018 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203
Copyright 2018 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203
 The Warren Vision

Warren/Reeve/Duchac’s Financial AccountingT E R15e gives students a solid foundation in

n to
ctioworld.
odureal
4
CHAP
Intrthe
1 ness
accounting to prepare them for future business courses and
nd Busi
1. H
 elps students connect concepts to the Accounting a Chapter 3

bigger picture with features such as the Transactions Adjusting Entri

es
Chapter 1
new Chapter-Opening Schema. Unadjusted
Accounts Adjusting
XXX Journal Entries
XXX Adjusted
Accrued Revenues Accounts
Accrued Expenses Unadj. Balances
System
Accounting Equation
Unadjusted Unearned Reve Adjustments XXX XXX
nues XXX
Trial Balance Prepaid Expenses Adj. Balances XXX
XXX
Accounting Total Debit
Depreciation XXX
es + Ow ner's Equity Balances = Total Credit
Ass ets = Liabiliti Balances
Adjusted Tria
l Balance
Total Debit

2. A
 ccounting Cycle Coverage provides an Chapter 2
Account
Debits
Credits
Balances = Total Credit
Balances

it
unmatched foundation so students are bit and Cred Chapter 4
Rules of De ACCOUNTS
Adjusted Acco
unts
ANCE SHEET
prepared to succeed in later chapters. BAL

ITY
XXX XXX

+ OWNER’S EQU ount Adjusted Balan

ces
ital Acc
= LIABILITIES Owner’s Cap for
ounts Credit
ASSETS Liability Acc Debit for
Asset Accoun
ts Credit for decreases (–)
increases (+) Financial Statem
Credit for
Debit for
decreases (–)
increases (+) Balance Income Stateme
nt
Statement of
ents
Debit for
decreases (–) Balance Own er’s Equity
increases (+)
Balance Adjusted
Closing Entries Balance Shee
t
ts
ement Accoun Accounts Closing
Income Stat
wing ounts Journal Entries Income Stateme
Owner’s Dra Revenue Acc XXX XXX and Drawing nt
Account Credit for Accounts
Debit for
Credit for increases (+) 0
Debit for decreases (–) Adjusted 0
decreases (–) Balance Balances
increases (+)
ounts Zero Balances
Balance Expense Acc Total Debit
Credit for Balances = Total Credit
Debit for Balances Balance Shee
decreases (–) t
increases (+) Accounts
Balance XXX
XXX

Post-Closing
Trial Balance
e
Trial Balanc
Unadjusted
Total Debit
Balances Balances = Total Credit
Total Credit Balances
Balances =
Total Debit

BK-CHE-WAR PM
REN_27E-160 08/11/16 4:56
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3. H
 elps learners appreciate why accounting is important to business and a prosperous
ARREN_27
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PM
BK-CHE-W

society with new tools such as the Why It Matters Concept Clips.

490 Chapter 10 Long-Term Assets: Fixed and Intangible

Investments are long-lived assets that are not used in the normal operations and
are held for future resale. Such assets are reported on the balance sheet in a section
entitled Investments. For example, undeveloped land acquired for future resale would
be classified and reported as an investment, not land.

The Cost of Fixed Assets

In addition to purchase price, the costs of acquiring fixed assets include all amounts
spent getting the asset in place and ready for use. For example, freight costs and the
costs of installing equipment are part of the asset’s total cost.
Exhibit 2 summarizes some of the common costs of acquiring fixed assets. These
costs are recorded by debiting the related fixed asset account, such as Land,1 Building,
Land Improvements, or Machinery and Equipment.

4. A presentation style built for the way this EXHIBIT 2 Costs of Acquiring Fixed Assets
generation reads and assimilates information.

Copyright 2018 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203 vii

Only costs necessary for preparing the fixed asset for use are included as a cost of
 Features

Roadmap for Success

Warren/Reeve/Duchac’s Financial Accounting 15e makes it easy for you to give students a solid foundation in
accounting without overwhelming students. Warren covers the fundamentals AND motivates students to learn by
showing how accounting is important to a business.

Built for Today’s Students

The Warren/Reeve/Duchac presentation style provides content in a way that this generation reads and assimilates
information.
• Short, concise paragraphs and bullets
• Stepwise progression
• Meaningful illustrations and graphs

Hallmarks of the Revision

New schemas provide a roadmap of accounting that emphasizes the big picture. Each chapter begins with
a new graphic Schema, or Roadmap of Accounting, that shows readers how the chapter material fits within
the larger context of the overall
book. With this approach, students
view chapter concepts as part of a CHAPTER
larger whole rather than as mere
independent pieces of knowledge,
for a truly functional ­u nderstanding
of accounting.
6 Accounting for
Merchandising Businesses
Chapters 1–4
Accounting Cycle

A four-part schema (Chs. 1–4) dem- Chapter 5

Accounting Systems

onstrates how chapter content inte-

grates within the accounting cycle. Income Statement
Statement of
Owner's Equity
Balance Sheet
Statement of
Cash Flows

The financial accounting chapters’ Chapter 6 Accounting for

Merchandising
Chapter 16 Cash Flows

schema (Chs. 5–17) highlights chap- Businesses

Assets = Liabilities + Owner's Equity
Chapter 8 Cash Chapter 11 Current Liabilities Chapter 12 Partnerships
ter content within a set of integrated Chapter 9
Chapter 7
Receivables
Inventories
Chapter 14 Bonds and Notes Chapter 13 Corporations

financial statements. Chapter 10 Fixed and Intangible

Assets
Chapter 15 Investments

Chapter 17
Financial Statement Analysis

Statement of Owner's Equity Statement of Cash Flows

Owner's capital, Jan. 1 $XXX Cash flows from (used in) operating activities $XXX
Net income $ XXX Cash flows from (used in) investing activities XXX
Withdrawals (XXX) Cash flows from (used in) financing activities XXX
Increase in capital XXX Increase (decrease) in cash flows $XXX
Retained earnings, Jan. 1, 20Y5 $XXX Cash as of January 1, 20Y5 XXX
Income Statement Balance
Cash as Sheet
of December 31, 20Y5 $XXX

Sales $XXX Current assets:

Cost of merchandise sold XXX Cash $XXX
Gross profit $XXX Accounts receivable XXX
Operating expenses: Merchandise inventory XXX
Advertising expense $XXX Total current assets $XXX
Depreciation expense XXX Property, plant, and equipment $XXX
Amortization expense XXX Intangible assets XXX
Depletion expense XXX Total long-term assets XXX
… XXX Total assets $XXX
… XXX Liabilities:
Total operating expenses XXX Current liabilities $XXX
Income from operations $XXX Long-term liabilities XXX
Other revenue and expenses XXX Total liabilities $XXX
Net income $XXX Owner’s equity XXX
Total liabilities and owner’s equity $XXX

viii
BK-CHE-WARREN_27E-160241-Chp06.indd 280 30/11/16 2:25 PM

Copyright 2018 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203
 Features ix
360 Chapter 7 Inventories

Revised and refreshed real company chapter openers engage readers from
the net realizable value ofthe start. New
the merchandise. andvalue
Net realizable fresh chapter
is determined as 4

follows: IFRS
openers introduce and briefly describe a real company andSee how its
Appendix B for challenges relate to the chapter content.
Net Realizable Value = Estimated Selling Price – Direct Costs of Disposal
Links
more information.
to this opening company appear throughout the chapter to reinforce Direct the costs
importance
of disposal include ofselling
what expensesreaders
such as specialareadvertising
learning.or
sales commissions.
To illustrate, assume the following data about an item of damaged merchandise:
Original cost $1,000
Estimated selling price 800
Estimated selling expenses 150

In applying LCM, the market value of the merchandise is $650, computed as follows:

7
CHAPTER Market Value (Net Realizable Value) = $800 – $150 = $650

Thus, the merchandise would be valued at $650, which is the lower of its cost of
Link to Best Buy $1,000 and its market value of $650.
Best Buy values its The lower-of-cost-or-market method can be applied in one of three ways. The
inventory at lower of cost, market price, and any declines could be determined for:
cost or market based • Each item in the inventory
upon cost and the • Each major class or category of inventory
amount it expects to • Inventory as a whole
realize from the sale.
The amount of any price decline is included in the cost of merchandise sold.
This, in turn, reduces gross profit and net income in the period in which the price
declines occur. This matching of price declines to the period in which they occur is
the primary advantage of using the lower-of-cost-or-market method.
To illustrate, assume the following data for 400 identical units of Item Echo in
inventory on December 31:
Cost per unit $10.25
Market value (net realizable value) per unit 9.50

Since the market value of Item Echo is $9.50 per unit, $9.50 is used under the lower-
RICHARD B. LEVINE/NEWSCOM

of-cost-or-market method.
Best Buy Exhibit 9 illustrates applying the lower-of-cost-or-market method to each inventory
A ssume that in September, you purchased a Sony
HDTV from Best Buy. At the same time, you pur-
Merchandising businesses such as Best Buy make
similar assumptions when identical merchandise is pur-
Link to Best Buy item (Echo, Foxtrot, Sierra, Tango). As applied on an item-by-item basis, the total lower-
of-cost-or-market is $15,070, which is a market decline of $450 ($15,520 – $15,070).
chased a Denon surround sound system for $599.99. You chased at different costs. For example, Best Buy may have The excess of cost
liked your surround sound so well that in November, you purchased thousands of Denon surround sound systems This market decline of $450 is included in the cost of merchandise sold.
purchased an identical Denon system on sale for $549.99 over the past year at different costs. At the end of a period,
over the amount
for your bedroom TV. Over the holidays, you moved to a some of the Denon systems will still be in inventory, and Best Buy expects to In Exhibit 9, Items Echo, Foxtrot, Sierra, and Tango could be viewed as a class of in-
new apartment and in the process of unpacking discov- some will have been sold. But which costs relate to the receive from the sale ventory items. If the lower-of-cost-or-market method is applied to the class, the inventory
ered that one of the Denon surround sound systems was sold systems, and which costs relate to the systems still
missing. Luckily, your renters or homeowners insurance in inventory? Best Buy’s assumption about inventory costs of an item is called a would be valued at $15,472, which is a market decline of $48 ($15,520 − $15,472). Likewise,
policy will cover the theft, but the insurance company can involve large dollar amounts and, thus, can have a sig- markdown. if Items Echo, Foxtrot, Sierra, and Tango make up the total inventory, the lower-of-cost-
needs to know the cost of the system that was stolen. nificant impact on the financial statements. For example, or-market method as applied to the total inventory would be the same amount, $15,472.
The Denon systems were identical. However, to re- Best Buy reported $5,731 million of inventory and net loss
spond to the insurance company, you will need to identify of $1,231 million for a recent year.
which system was stolen. Was it the first system, which This chapter discusses such issues as how to deter-
cost $599.99, or was it the second system, which cost mine the cost of merchandise in inventory and the cost
$549.99? Whichever system you choose will determine of merchandise sold. However, it begins by discussing the EXHIBIT 9 A B C D E F G
the amount that you receive from the insurance company. importance of control over inventory. 1 Market Value
Determining 2 Inventory Cost per per Unit Total
Inventory at Lower 3 Item Quantity Unit (Net Realizable Value) Cost Market LCM
of Cost or Market 4 Echo 400 $10.25 $ 9.50 $ 4,100 $ 3,800 $ 3,800
(LCM) 5 Foxtrot 120 22.50 24.10 2,700 2,892 2,700
6 Sierra 600 8.00 7.75 4,800 4,650 4,650
7 Tango 280 14.00 14.75 3,920 4,130 3,920
BK-CHE-WARREN_27E-160241-Chp07.indd 345 20/09/16 8:43 PM
8 Total $15,520 $15,472 $15,070
9
278 Chapter 5 Accounting Systems
Revised end-of-chapter assignments (homework) provide important hands-on practice. Refined, meaningful review 4 Accounting Standards Update, Inventory (Topic 330): Simplifying the Measurement of Inventory, No. 2015-11, July 2015, FASB
(Norwalk, CT).
3. Post the appropriate individual entries to the general ledger.
and applications at the end of each chapter include Discussion Questions, Practice Exercises (A and B versions),
4. Total each of the columns of the special journals and post the appropriate totals to
Exercises, Problems (Series A and B), the
and Cases
general & Projects
ledger; that emphasize
insert the account balances. ethics, teamwork, and communication skills.
5. Prepare a trial balance.
BK-CHE-WARREN_27E-160241-Chp07.indd 360 19/11/16 7:23 PM

Cases & Projects

CP 5-1 Ethics in Action

Netbooks Inc. provides accounting applications for business customers on the Internet for
a monthly subscription. Netbooks customers run their accounting system on the Internet;
Ethics
thus, the business data and accounting software reside on the servers of Netbooks Inc. The
senior management of Netbooks believes that once a customer begins to use Netbooks,
it is very difficult to cancel the service. That is, customers are “locked in” because it is
difficult to move the business data from Netbooks to another accounting application even
though the customers own their own data. Therefore, Netbooks has decided to entice
customers with an initial low monthly price that is half the normal monthly rate for the
first year of services. After a year, the price will be increased to the regular monthly rate.
Netbooks management believes that customers will have to accept the full price because
customers will be “locked in” after one year of use.
a. Discuss whether the half-price offer is an ethical business practice.
b. Discuss whether customer “lock-in” is an ethical business practice.

CP 5-2 Team Activity

The two leading software application providers for supply chain management (SCM)
Team
Activity and customer relationship management (CRM) software are JDA and Salesforce.com,
respectively. In groups of two or three, go to the website of each company (www
.jda.com and www.salesforce.com, respectively) and list the services provided by each
Real
World company’s software.

CP 5-3 Communication
Internet-based accounting software is a recent trend in business computing. Major software
Communication firms such as Oracle, SAP, and NetSuite are running their core products on the Internet
using cloud computing. NetSuite is one of the most popular small-business Internet-based
accounting systems.
Real Go to NetSuite Inc.’s website at www.netsuite.com. Read about the product and
World
prepare a memo to management defining cloud-based accounting. Also outline the advan-
tages and disadvantages of using cloud-based accounting compared to running software
on a company’s internal computer network.

Copyright 2018 Cengage Learning. CP

All 5-4 Manual
Rights vs. computerized
Reserved. accounting
May not be copied, systems
scanned, or duplicated, in whole or in part. WCN 02-200-203
The following conversation took place between Durable Construction Co.’s bookkeeper,
Kyle Byers, and the accounting supervisor, Sarah Nelson:
 Close the Gap
Between Homework and Exam Performance
with CengageNOWv2.

We’ve talked with hundreds of accounting

instructors across the country, and we are learning
that online homework systems have created a new
challenge in the accounting course.
CengageNOWv2 better prepares students
We are hearing that students perform well on the for the exam by providing an online
homework but poorly on the exam, which leads homework experience that is similar to
instructors to believe that students are not truly what students will experience on the
learning the content, but rather are memorizing exam and in the real world.
their way through the system. Read on to see how CengageNOWv2 helps close this gap.

Copyright 2018 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203
Closing the gap, one step at a time.

Multi-Panel View
One of the biggest complaints students have about online homework is the scrolling, which prevents students from
seeing the big picture and understanding the accounting system. This new Multi-Panel View in CengageNOWv2
enables students to see all the elements of a problem on one screen.
•• Students make
connections and
see the tasks
as connected
components in the
accounting process.
•• Dramatically reduced
scrolling eliminates
student frustration.

Blank Sheet
of Paper
Experience
Many students perform
well on homework but
struggle when it comes
to exams. Now, with
the new Blank Sheet of Paper Experience, students must problem-solve on their own, just as they would if taking a
test on a blank sheet of paper. This discourages overreliance on the system.
•• Students must refer to the Chart of Accounts and decide for themselves which account is impacted.
•• The number of accounts in each transaction is not given away.
•• Whether the account should be debited or credited is not given away.
•• Transactions may be entered in any order
(as long as the entries are correct).

Adaptive Feedback
Adaptive Feedback responds to students
based upon their unique answers and alerts
them to the type of error they have made
without giving away the answer.

Copyright 2018 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203
From Motivation to Mastery

MOTIVATION:
Engage students and better prepare
them for class.
NEW Video: Animated Concept Clips
Animated Concept Clips are brief captivating
video clips that expose students to why a
concept is important and how the concept is
used in the real world.

Video: Tell Me More

Tell Me More lecture activities explain the core
concepts of the chapter through an engaging
auditory and visual presentation that is ideal for
all class formats—flipped mode, online, hybrid,
face-to-face.

Adaptive Study Plan

The Adaptive Study Plan is an assignable/gradable study center that adapts
to each student’s unique needs and provides a remediation pathway to keep
students progressing.

APPLICATION:
Help students apply accounting concepts.
Video: Show Me How
Linked to end-of-chapter problems in CengageNOWv2, Show Me How
problem demonstration videos provide a step-by-step model of a
similar problem.

MASTERY:
Teach students to go beyond memorization to true understanding.
Interactive Dynamic Exhibits allow students to change the variables
in a scenario and see how a change ripples through the accounting
system. This helps students see connections and relationships
like never before!

Mastery Problems allow students to connect concepts across

multiple objectives and demonstrate mastery.

Copyright 2018 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203
And that’s not all…
You might also want to learn about the MindTap eReader, our LMS integration options, and more.

MindTap eReader ADA Accessibility

The MindTap eReader is the most robust digital Cengage Learning is committed to making its
reading experience available. educational materials accessible to users of all abilities.
•• Fully optimized for the iPad. We are steadily working to increase accessibility and
create a full spectrum of usable tools, features, and
•• Note-taking, highlighting, and more.
choices that are accessible for users of all abilities.
•• Offline access to smartphones. All new Cengage Learning products and services are
•• Embedded digital media such as the designed with accessibility in mind.
Dynamic Exhibits. •• With the latest release of CengageNOWv2:
The MindTap eReader also features ReadSpeaker®, • Images and graphics have been converted to HTML
an online text-to-speech application that vocalizes, tables so that they can be read by screen readers.
or “speechenables,” online educational content.
• The assignment experience now offers proper
heading structure to support easy navigation with
LMS Integration assistive technology.
CengageNOWv2 can be seamlessly integrated •• CengageNOWv2 solutions offer high contrast and
with most Learning Management Systems. well-structured HTML, which helps support screen
Adopters will enjoy: reader interactivity.
•• A Seamless User Experience—Access your •• All videos are created with closed captioning and
Cengage resources seamlessly using only transcripts available for download.
your LMS login credentials. •• The MindTap eReader is HTML-based and compatible
•• Simplified Registration Process—Get students with most screen reading assistive software. The
up and running faster! eReader supports browser settings for high-contrast
•• Content Customization and Deep Linking— narrative text, variable font sizes, and multiple
Use our Content Selector to create a unique learning foreground and background color options.
path for students that blends your content with For more information on accessibility, please visit
Cengage Learning activities, eText, and more within www.cengage.com/accessibility.
your LMS course.
•• Automatic Grade Synchronization*—Need to iPad Tablet Compatibility
have your course grades recorded in your LMS
CengageNOWv2 is fully compatible with the iPad and
gradebook? No problem. Simply select the activities
other tablet devices, with the exception of General
you want synched and grades will automatically be
Ledger (CLGL) and Excel Tutorials, which are flash
recorded in your LMS gradebook.
based.
* Grade synchronization is currently available with Blackboard,
Brightspace (powered by D2L), Angel 8, and Canvas.

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New to This Edition
In this edition, the following improvements have been ° Prepaid Expenses
made to all chapters: ° Depreciation
• Added schema at the beginning of each chapter to • Inserted account numbers of NetSolutions in trial
show students how the chapter material fits within balances for Exhibits 3 and 9. Account numbers are
the overall textbook. added to trial balances in selected end-of-chapter
° In financial chapters, the schema links material to items and solutions where appropriate.
the accounting cycle or the financial statements. Chapter 4
° In managerial chapters, the schema moves through • Revised Exhibit 1 for report form of balance sheet.
developing information and ultimately into evaluat-
• Revised discussion of closing entries from four clos-
ing and analyzing information to make decisions.
ing entries to just two closing entries.
• Updated dates and real company information for
currency. ° The temporary account Income Summary is no
longer used in the closing process.
• Added “Link to” for the opening company to inter-
weave real-world references through each chapter. ° Updated closing process to the one used in mod-
ern, computerized accounting systems.
• Refreshed end-of-chapter assignments with different
numerical values and updated information. ° Simpler for students to understand.
• Revised Cases & Projects to include Ethics in Action, ° First closing entry closes revenues and expenses
yielding net income or net loss, which is trans-
Team Activity, and Communication in every chapter.
ferred to owner’s capital, and ties into the income
Chapter 1 statement.
• Added new Exhibit 1 to show a more accurate nature ° Second closing entry closes owner’s drawing ac-
of the flow of information to users. count to owner’s capital account.
• Added equality of accounting equation after each • Revised Exhibits 3 and 4 to reflect new two-entry
transaction A through H. closing method.
• Report form of balance sheet shown in Exhibit 9. • Added new Exhibit 8 that ties the Chapters 1–4
Report form is used throughout remaining chapter schema into the accounting cycle and summarizes
and end of chapter. the accounting cycle.
• Changed account form presentations to report form • Inserted account numbers into trial balances for
presentations. Exhibits 7 (NetSolutions), 11, 14, and 17 (Kelly
• Updated ratio of liabilities to owner’s equity. Consulting). Account numbers are added to trial bal-
Chapter 2 ances in selected end-of-chapter items and solutions
where appropriate.
• Revised Exhibit 3 rules for debits and credits to ease
student understanding. • Added new Appendix 2, Reversing Entries, at the end
of the chapter. Reversing entries are consistent with
• Inserted account numbers in trial balance of Exhibit
most modern, computerized accounting systems.
7. Account numbers are added to trial balances in
selected end-of-chapter solutions where appropriate. Chapter 5
• Added account numbers to the unadjusted trial • Added a new dedicated schema for Chapter 5, which
­balance. shows the revenue collection cycle and purchase
• Updated Microsoft Business Connection box. ­payment cycle as part of an accounting system.

Chapter 3 Chapter 6
• Revised Nature of the Adjusting Process and updated • Integrated the new revenue recognition standard
for new revenue recognition standard. (Revenue from Contracts with Customers) through-
out the chapter and the NetSolutions illustration.
• New Exhibits 1 and 2.
• Added new Exhibit 2, which shows the chart of
• Reordered discussion of adjustments from simplest
accounts for NetSolutions. The chart of accounts
­
to more complex as follows:
includes accounts for Estimated Returns Inventory
­
° Accrued Revenues and Customer Refunds Payable.
° Accrued Expenses
° Unearned Revenues

xiv
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 New to This Edition xv

• Added journal entry for purchases discounts “not • The end-of-chapter materials have been revised to
taken.” include the effects of the chapter reorganization.
• Reorganized sales transactions discussion: Chapter 7
° Journal entry for sales discount “not taken” has • Added new Business Connection boxes:
been added.
° Pawn Stars and Specific Identification
° Adjusting entries for customer refunds, allow- ° Computerized Perpetual Inventory Systems
ances, and returns have been moved to the end of
° Good Samaritan
the chapter with the adjusting entry for inventory
shrinkage. This simplifies the initial discussion of Chapter 8
customer refunds, allowances, and returns. • Revised chapter title to delete reference to Sarbanes-
Oxley.
° Discussion of customer refunds, allowances, and
returns has been changed so that the discussion • Exhibit 2 changed from Nike to eBay (consistent with
flows from simple to complex as follows: chapter opener).
¤ Customer cash refunds (no return) • Updated example in Ethics box.
¤ Customer allowance against their accounts re- • Added new Business Connection boxes:
ceivable (no return; credit memorandum) ° Mobile Payments
¤ Customer return with refund or allowance ° Managing Apple’s Cash
• Revised Exhibit 9 (Recording Merchandise Inventory Chapter 9
Transactions) to exclude the effects of adjusting • New opening company, Keurig Green Mountain, Inc.
­entries for customer refunds, allowances, and returns.
• Added new Business Connection boxes:
• Revised Exhibit 10 (Illustration of Merchandise
Inventory Transactions for Seller and Buyer) to ° Warning Signs
­include a customer cash refund and a return with ° Failure to Collect
an allowance (credit) memorandum to the customer’s Chapter 10
accounts receivable. • Changed title to Long-Term Assets: Fixed and
• Revised discussion of the adjusting process for a Intangible.
merchandise business to include the adjustments for • New Business Connection box on Fixed Assets.
customer refunds, allowances, and returns. The dis- • Reorganized chapter as follows:
cussion is ordered from simple to complex with the
° Capital and Revenue Expenditures now appears
first adjustment (the simplest) for inventory shrink-
after discussion of depreciation and before the
age followed by the more complex adjustments for
discussion of disposal of fixed assets. Capital and
customer refunds, allowances, and returns.
Revenue Expenditures section is now titled Repair
• Updated NetSolutions financial statements (Exhibits and Improvements.
11, 12, 13, and 14) include the effects of the new
° Partial-Year Depreciation is now covered as a sep-
revenue recognition standard. For example, the bal-
arate section after all three depreciation methods
ance sheet (Exhibit 14) includes Estimated Returns
have been discussed.
Inventory and Customer Refunds Payable. Note that
• New Exhibit 3 (Depreciation Expense).
this is consistent with the chart of accounts presented
in Exhibit 2. • New Exhibit 4 (Straight-Line Method).
• The closing process has been changed to use only • Added journal entry for recording straight-line de-
two closing entries. This is consistent with the closing preciation.
entries in Chapter 4. The first closing entry closes the • Book value emphasized in discussion of all three
revenue and expense accounts to the owner’s capital depreciation methods.
account. Owner’s capital account is credited for net • New Exhibit 5 (Straight-Line Method: Depreciation
income and debited for a net loss. The second clos- Expense and Book Value).
ing entry closes the owner’s drawing account to the • Added journal entry for recording units-of-activity
owner’s capital account. method.
• The chapter appendix (The Periodic Inventory • New Exhibit 6 (Units-of-Activity Method).
System) using NetSolutions has been revised to • Added journal entry for recording double-declining-
­include the effects of the new revenue recognition balance method.
standard.
• New Exhibit 7 (Double-Declining-Balance Method).

Copyright 2018 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203
xvi New to This Edition

• New Partial-Year Depreciation section. Chapter 15

• Added new Repair and Improvements section. • Refreshed Interest Timeline exhibits to clearly illus-
• Added new Business Connection box on Downsizing. trate the timing of interest accruals.
Chapter 11 Chapter 16
• Refreshed Financial Analysis and Interpretation dis- • Added Business Connection boxes:
cussion of quick ratio. ° Cash Crunch!
• Added Business Connection box on State Pension ° Growing Pains at Twitter
Obligations. • Updated and expanded Financial Analysis and
• Updated federal wage bracket withholding infor­ Interpretation discussion of free cash flow.
mation. Chapter 17
Chapter 12 • Revised learning objectives on liquidity analysis and
• Closing entries are changed to reflect a single-stage solvency analysis.
approach to closing—closing revenues and expenses • Added learning objective on Analyzing and
to partnership capital directly, without using an Interpreting Financial Statements.
income summary account. • Name changes to several ratios:
• New entries are provided to illustrate closing the
° From “number of times interest charges are
partner drawing accounts. earned” to “times interest earned”
• The term “net assets” is more clearly defined.
° From “ratio of assets to sales” to “asset turnover”
• Revised Exhibit 7, Statement of Partnership
° From “rate earned on total assets” to “return on
Liquidation: Loss on Realization—Capital Deficiency, total assets”
to provide a clearer presentation of the transactions
steps. ° From “rate earned on stockholders’ equity” to
“­return on stockholders’ equity”
Chapter 13
° From “rate earned on common stockholders’
• Google named changed to Alphabet (Google), Inc. equity” to “return on common stockholders’
­
• Moved Stock Splits earlier in the chapter. It is now ­equity”
Objective 5, which follows dividends (Obj. 4). • Refreshed Exhibit 13, Summary of Analytical Measures.
• Treasury stock is now Objective 6. • Added Business Connection boxes:
• New Business Connections boxes:
° Flying off the Shelves
° Excerpts from Alphabet (Google)’s Bylaws ° Liquidity Crunch at Radio Shack
° You Have No Vote ° Gearing for Profit
° Treasury Stock or Dividends? • Updated Comprehensive Problem for Nike’s recent
Chapter 14 financial statements.
• Added Business Connection box on Investor Bond
Price Risk.
• Refreshed Financial Analysis and Interpretation
discussion of times interest earned, focusing on
­
intraindustry comparisons.

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 Instructor Resources

Solutions Manual assignment preparation grid that includes information

Author-written and carefully verified multiple times about learning objective coverage, difficulty level and
to ensure accuracy and consistency with the text, the Bloom’s taxonomy categorization, time estimates, and
Solutions Manual contains answers to the Discussion accrediting standard alignment for business programs,
Questions, Practice Exercises, Exercises, Problems (Series AICPA, ACBSP, and IMA.
A and Series B), Continuing Problems, Comprehensive
PowerPoint Slides Bring your lectures to life with slides
Problems, and Cases & Projects that appear in the text.
designed to clarify difficult concepts for your students.
These solutions help you easily plan, assign, and efficiently
The lecture PowerPoints include key terms and definitions,
grade assignments.
equations, examples, and exhibits from the textbook.
Test Bank Descriptions for all graphics in the PowerPoints are
included to enhance PowerPoint usability for students
Test Bank content is delivered via Cengage Learning
with disabilities.
Testing, powered by Cognero®, a flexible, online system
that allows you to: Excel Template Solutions Excel Templates
• Author, edit, and manage test bank content are provided for selected long or complicated
• Create multiple test versions in an instant end-of-chapter exercises and problems to EXCEL

• Deliver tests from your LMS, from your classroom, or assist students as they set up and work the problems.
through CengageNOWv2 Certain cells are coded to display a red asterisk when an
• Export tests in Word format incorrect answer is entered, which helps students stay on
track. Selected problems that can be solved using these
Companion Website templates are designated by an icon in the textbook
and are listed in the assignment preparation grid in the
This robust companion website provides immediate
Instructor’s Manual. The Excel Template Solutions provide
access to a rich array of teaching and learning resources—
answers to these templates.
including the Instructor’s Manual, PowerPoint slides, and
Excel Template Solutions. Easily download the instructor
Practice Set Solutions Establish a fundamental
resources you need from the password-protected,
understanding of the accounting cycle for your students
instructor-only section of the site.
with Practice Sets, which require students to complete
one month of transactions for a fictional company.
Instructor’s Manual Discover new ways to engage your
Brief descriptions of each Practice Set are provided in
students by using the Instructor’s Manual ideas for class
the Table of Contents. The Practice Set Solutions provide
discussion, group learning activities, writing exercises, and
answers to these practice sets.
Internet activities. Moreover, simplify class preparation
by reviewing a brief summary of each chapter, a detailed
chapter synopsis, teaching tips regarding a suggested
approach to the material, questions students frequently
ask in the classroom, lecture aids, and demonstration
problems in the Instructor’s Manual. Quickly identify
the assignments that best align your course with the

xvii
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 Student Resources

Study Guide
Now available free in CengageNOWv2, the Study Guide allows students to easily assess what they
know with a “Do You Know” checklist covering the key points in each chapter. To further test their
comprehension, students can work through Practice Exercises, which include a “strategy” hint and
solution so they can continue to practice applying key accounting concepts.

Working Papers
Students will find the tools they need to help work through end-of-chapter assignments with the
Working Papers. The preformatted templates provide a starting point by giving students a basic
structure for problems and journal entries. Working Papers are available in a printed format as a
bundle option.

Practice Sets
For more in-depth application of accounting practices, instructors may choose from among six
different Practice Sets for long-term assignments. Each Practice Set requires students to complete
General
one month of transactions for a fictional company. Practice Sets can be solved manually or with Ledger
the Cengage Learning General Ledger software.

Website
Designed specifically for your students’ accounting needs, this website features student
PowerPoint slides and Excel Templates, as well as the Study Guides.
▪▪ PowerPoint Slides: Students can easily take notes or review difficult concepts with the student
version of this edition’s PowerPoint slides.
▪▪ Excel Templates: These Excel Templates help students stay on track. If students enter an
incorrect answer in certain cells, a red asterisk will appear to let them know something is wrong.
Problems that can be solved using these templates are designated by an icon. EXCEL

xviii
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 Chapter 6 Accounting for Merchandising Businesses xix

Acknowledgments

The many enhancements to this edition of Financial Accounting are the direct result of one-on-one interviews,
surveys, reviews, and focus groups with instructors at institutions across the country. We would like to take this
opportunity to thank those who helped us better understand the challenges of the principles of accounting course
and provided valuable feedback on our content and digital assets.

Debbie Adkins, Remington College Esther S. Bunn, Stephen F. Austin Robin D’Agati, Palm Beach State
Online State University College
Sharon Agee, Rollins College Jacqueline Burke, Hofstra University Dori Danko, Grand Valley State
Sol. Ahiarah, SUNY Buffalo State Lisa Busto, William Rainey Harper University
John G. Ahmad, Northern Virginia College Emmanuel Danso, Palm Beach State
Community College Thane Butt, Champlain College College
Janice Akeo, Butler Community Marci Butterfield, University of Bruce L. Darling, University of
College Utah Oregon
Dave Alldredge, Salt Lake Community Magan Calhoun, Austin Peay State Dorothy Davis, University of
College University Louisiana Monroe
Robert Almon, South Texas College Julia M. Camp, Providence College Rebecca Grava Davis, East Mississippi
Lynn Almond, Virginia Tech Kirk Canzano, Long Beach City Community College
Elizabeth Ammann, Lindenwood College Julie Dawson, Carthage College
University Roy Carson, Anne Arundel Christopher Demaline, Central
Sheila Ammons, Austin Community Community College Arizona College
College Cassandra H. Catlett, Carson Newman Carol Dickerson, Chaffey College
Anne Marie Anderson, Raritan Valley University Patricia Doherty, Boston University
Community College David Centers, Grand Valley State School of Management
Rick Andrews, Sinclair Community University Michael P. Dole, Marquette University
College Machiavelli W. Chao, University of Karen C. Elsom, Fayetteville Technical
Leah Arrington, Northwest Mississippi California, Irvine Community College
Community College Bea Chiang, The College of Nancy Emerson, North Dakota State
Christopher Ashley, Everest College New Jersey University
John Babich, Kankakee Community Linda Christiansen, Indiana University James M. Emig, Villanova University
College Southeast Bruce England, Massasoit Community
Felicia R. Baldwin, Richard J. Daley Lawrence Chui, University of College
College St. Thomas Lucile Faurel, University of California,
Sara Barritt, Northeast Community Colleen Chung, Miami Dade College Irvine
College Tony Cioffi, Lorain County Robert Foster, Los Angeles Pierce
Geoffrey D. Bartlett, Drake University Community College College
Jan Barton, Emory University Sandra Cohen, Columbia College Kimberly Franklin, St. Louis
Robert E. (Reb) Beatty, Anne Arundel Chicago Community College
Community College Debora Constable, Georgia Perimeter Michael J. Gallagher, DeSales
Eric Blazer, Millersville University College University
Cindy Bleasdal, Hilbert College Susan Cordes, Johnson County Ann Gervais, Springfield Technical
Cynthia Bolt, The Citadel Community College Community College
Anna Boulware, St. Charles Leonard Cronin, University Center Alex Gialanella, Manhattanville
Community College Rochester College
Gary Bower, Community College of Louann Hofheins Cummings, The Michael Goeken, Northwest Vista
Rhode Island University of Findlay College
Thomas Branton, Alvin Community Sue Cunningham, Rowan Cabarrus Nino Gonzalez, El Paso Community
College Community College College
Gregory Brookins, Santa Monica Don Curfman, McHenry County Saturnino (Nino) Gonzalez, El Paso
College College Community College

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xx Acknowledgments

Lori A. Grady, Bucks County Suzanne Laudadio, Durham Technical Rita Mintz, Calhoun Community
Community College Community College College
Carol Graham, The University of Greg Lauer, North Iowa Area Jill Mitchell, Northern Virginia
San Francisco Community College Community College
Marina Grau, Houston Community David E. Laurel, South Texas College Timothy J. Moran, Aurora University
College Michael Lawrence, Mt. Hood Michelle Moshier, University at
Gloria Grayless, Sam Houston State Community College Albany
University Charles J. F. Leflar, University of Linda Muren, Cuyahoga Community
Tim Green, North Georgia Technical Arkansas College
College Jennifer LeSure, Ivy Tech Community Andrea Murowski, Brookdale
Ann Gregory, South Plains College College Community College
Timothy Griffin, Hillsborough Bruce Leung, City College of Johnna Murray, University of
Community College San Francisco Missouri-St. Louis
Sheila Guillot, Lamar State College- Charles Lewis, Houston Community Adam Myers, Texas A&M University
Port Arthur College John Nader, Davenport University
Michael Gurevitz, Montgomery Erik Lindquist, Lansing Community Joseph M. Nicassio, Westmoreland
College College County Community College
Keith Hallmark, Calhoun Community Harold Little, Western Kentucky Lisa Novak, Mott Community College
College University Jamie O’Brien, South Dakota State
Rebecca Hancock, El Paso James Lock, Northern Virginia University
Community College Community College Ron O’Brien, Fayetteville Technical
Martin Hart, Manchester Community Katy Long, Hill College Community College
College Dawn Lopez, Johnson & Wales Robert A. Pacheco, Masssasoit
Len Heritage, Tacoma Community University Community College
College Ming Lu, Santa Monica College Edwin Pagan, Passaic County
Katherine Sue Hewitt, Klamath Angelo Luciano, Columbia College Community College
Community College Chicago Judy Patrick, Minnesota State
Merrily Hoffman, San Jacinto College Debbie Luna, El Paso Community Community and Technical
Jose Hortensi, Miami Dade College College College
Jana Hosmer, Blue Ridge Community Jennifer Mack, Lindenwood University Sy Pearlman, California State
College Suneel Maheshwari, Marshall University, Long Beach
Aileen Huang, Santa Monica College University Aaron Pennington, York College of
Marianne James, California State Ajay Maindiratta, New York University Pennsylvania
University, Los Angeles Richard Mandau, Piedmont Technical Rachel Pernia, Essex County College
Cynthia Johnson, University of College Dawn Peters, Southwestern Illinois
Arkansas at Little Rock Michele Martinez, Hillsborough College
Lori Johnson, Minnesota State Community College April Poe, University of the Incarnate
University Moorhead Michelle A. McFeaters, Grove City Word
Odessa Jordan, Calhoun Community College Michael P. Prockton, Finger Lakes
College Noel McKeon, Florida State College Community College
Stani Kantcheva, Cincinnati State at Jacksonville Kristen Quinn, Northern Essex
Technical and Community College Chris McNamara, Finger Lakes Community College
Chris Kinney, Mount Wachusett Community College La Vonda Ramey, Schoolcraft College
Community College Kevin McNelis, New Mexico State Marcela Raphael, Chippewa Valley
Taylor Klett, Sam Houston State University Technical College
University Glenn (Mel) McQueary, Houston Jenny Resnick, Santa Monica College
Stacy Kline, Drexel University Community College Rick Rinetti, Los Angeles City College
Pamela Knight, Columbus Technical Brenda McVey, Green River Cecile Roberti, Community College of
College Community College Rhode Island
W. Jeff Knight, Flagler College Pam Meyer, University of Louisiana at Shani N. Robinson, Sam Houston
Lynn Krausse, Bakersfield College Lafayette State University
Barbara Kren, Marquette University Jeanette Milius, Iowa Western Patrick Rogan, Cosumnes River
Jeffrey T. Kunz, Carroll University Community College College
Steven J. LaFave, Augsburg College Cynthia J. Miller, University of Lawrence A. Roman, Cuyahoga
Tara Laken, Joliet Junior College Kentucky Community College
Meg Costello Lambert, Oakland Linda Miller, Northeast Community Debbie Rose, Northeast Wisconsin
Community College College Technical College
Richard Lau, California State Julie Miller Millmann, Chippewa Leah Russell, Holyoke Community
University, Los Angeles Valley Technical College College

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 Acknowledgments xxi

John H. Sabbagh, Northern Essex Gerald Smith, University of Northern Teresa Thompson, Chaffey
Community College Iowa Community College
Lynn K. Saubert, Radford University Judy Smith, Parkland College Judith A. Toland, Bucks County
Marie Saunders, Dakota County Ryan Smith, Columbia College Community College
Technical College Jennifer Spring Sneed, Arkansas State Lana Tuss, Chemeketa Community
Michael G. Schaefer, Blinn College University-Newport College
Jennifer Schneider, University of Nancy L. Snow, University of Toledo Robert Urell, Irvine Valley College
North Georgia Sharif Soussi, Charter Oak State Jeff Varblow, College of Lake County
Darlene Schnuck, Waukesha County College John Verani, White Mountains
Technical College Marilyn Stansbury, Calvin College Community College
John Seilo, Irvine Valley College Larry G. Stephens, Austin Community Patricia Walczak, Lansing Community
Mon Sellers, Lone Star College-North College College
Harris Dawn W. Stevens, Northwest Terri Walsh, Seminole State College
Perry Sellers, Lone Star College Mississippi Community College James Webb, University of the Pacific
System Joel Strong, St. Cloud State University Wanda Wong, Chabot College
Jim Shelton, Harding University Timothy Swenson, Sullivan University Patricia Worsham, Norco College
Ercan Sinmaz, Houston Community Linda H. Tarrago, Hillsborough Judith Zander, Grossmont College
College Community College Mary Zenner, College of Lake County
Lee Smart, Southwest Tennessee Denise Teixeira, Chemeketa
Community College Community College

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Another Random Scribd Document
with Unrelated Content
not separate in its parts. Each atom of matter, so called, has also its
atom of spirit This is what the Bagavad-Gita48 denominates Purusha
and Prakriti, and Krishna there says that he is at once Purusha and
Prakriti, he is alike the very best and the very worst of men. These
triangles also mean, “the manifested universe.” It is one of the
oldest and most beautiful of symbols, and can be discovered among
all nations, not only those now inhabiting the earth, but also in the
monuments, carvings and other remains of the great races who have
left us the gigantic structures now silent as far as the voice of man is
concerned, but resounding with speech for those who care to listen.
They seem to be full of ideas turned into stone.
The triangles thus combined form in the interior space, a six sided
plane figure. This is the manifested world. Six is the number of the
world, and 666 is the great mystery which is related to the symbol.
St. John talks of this number. Around the six sided centre are the six
triangles projecting into the spiritual world, and touching the
enclosed serpent of wisdom. In an old book, this is made by the
great head of the Lord rising above the horizon of the ocean of
matter, with the arms just raised so that they make the upper half of
the triangle. This is the “long face,” or macrocoscopos, as it is called.
As it rises slowly and majestically, the placid water below reflects it
in reverse, and thus makes the whole double triangle. The lower one
is dark and forbidding in its aspect, but at the same time the upper
part of the darker one is itself light, for it is formed by the majestic
head of this Adam Kadmon. Thus they shade into one another. And
this is a perfect symbolism, for it clearly figures the way in which day
shades into night, and evil into good. In ourselves we find both, or
as the Christian St. Paul says, the natural and spiritual man are
always together warring against each other, so that what we would
do we cannot, and what we desire not to be guilty of, the darker half
of man compels us to do. But ink and paper fails us in the task of
trying to elucidate this great symbol. Go to Hermes, to St. John, the
Caballah, the Hindu books, wherever you please, and there will you
find the seven times seven meanings of the interlaced triangles.
 OM is the Sacred Vedic syllable: let us repeat it with a thought
directed to its true meaning.49
Within the small circle, placed upon the serpent, is a cross with its
ends turned back. This is called the Gnostic Cross. It signifies
evolution, among other ideas, for the turning back of its ends is
caused by the revolving of the two diameters of the circle. The
vertical diameter is the spirit moving down and bisecting the
horizontal. This completed, the revolution round the great circle
commences, and that motion is represented in the symbol by the
ends turned back. In Chapter III. of Bagavad-Gita, Krishna says: “He
who in this life does not cause this cycle, thus already revolved, to
continue revolving lives to no purpose, a life of sin, indulging his
senses.” That is, we must assist the great wheel of evolution and not
oppose it; we must try to help in the great work of returning to the
source from whence we came, and constantly endeavor to convert
lower nature into higher, not only that of ourselves, but also of our
fellow men and of the whole animated world.
This cross is also the symbol of the Hindu Chakkra, or discus, of
Vishnu. In the Mahabharata is described the conflict between the
Asuras and Devas, for the possession of the vase of Amreeta which
had been churned with infinite trouble, from the ocean, and which
the Asuras desired to take for themselves. The conflict began when
Rahu, an Asura, assuming the form of a Deva, began drinking the
ambrosia. In this case the Amreeta was spiritual wisdom, material
existence, immortality, and also magic power. The deceit of Rahu
was discovered before he had swallowed, and then the battle began.
“In the midst of this dreadful hurry and confusion of the fight, Nar
and Narayan entered the field together. Narayan beholding a
celestial bow in the hands of Nar, it reminded him of his Chakkra,
the destroyer of the Asuras. The faithful weapon, ready at the mind’s
call, flew down from heaven with direct and refulgent speed,
beautiful, yet terrible to behold. And being arrived, glowing like the
sacrificial flame, and spreading terror around, Narayan with his right
arm formed like the elephantine trunk, hurled forth the ponderous
orb, the speedy messenger, and glorious ruin of hostile towns, who
raging like the final all destroying fire, shot bounding with desolating
force, killing thousands of the Asuras in his rapid flight, burning and
involving, like the lambent flame, and cutting down all that would
oppose him. Anon he climbeth the heavens from whence he came.”
(Mahabharata, Book I, Chap 15.)
Ezekiel, of the Jews, saw this wheel, when he was among the
captives by the river Chebar in Chaldea. In a vision he saw the four
beasts and the man of the Apocalypse, and with them “for each of
the four faces,” was a wheel, of the colour of a beryl; it was “as a
wheel within a wheel,” and they went wherever the living creatures
went, “for the spirit of the living creatures was in the wheels.” All of
this appeared terrible to him, for he says: “And when they went I
heard a noise like the noise of great waters, like the voice of the
Almighty, a noise of tumult like the noise of a host.”
There are many other meanings concealed in this symbol, as in all
the others.
In the center of the interlaced triangles is placed the Cruxansata.
This is also extremely ancient. In the old Egyptian papyri it is
frequently found. It signifies life. As Isis stands before the candidate,
or the soul, upon his entry, she holds in one hand this cross, while
he holds up his hand that he may not look upon her face. In another
there is a winged figure, whose wings are attached to the arms, and
in each hand is held the same cross. Among other things we find
here the horizontal and vertical diameters once more, but conjoined
with the circle placed on top. This is the same as the old astrological
sign for Venus. But in the seal, its chief and most important meaning
is the regenerated man. Here in the centre, after passing the
different degrees and cycles, both spirit and matter are united in the
intelligent regenerated man, who stands in the middle knowing all
things in the manifested universe. He has triumphed over death and
holds the cross of life.
 The last theosophical symbol is, the pin of the Society, adopted
early in its history but not used much. It is the cross we have just
been considering, entwined in such a way by a serpent, that the
combination makes T S as a monogram.
The foregoing is not exhaustive. Every symbol should have seven
meanings of principal value, and out of every one of those we have
been considering can be drawn that number of significations.
Intelligent study of them will be beneficial, for when a consistent
symbol, embodying many ideas is found and meditated upon, the
thought or view of the symbol brings up each idea at once before
the mind.
Nilakant.

Reviews.

The Secret Doctrine of the Ancient Mysteries.—An essay by J. D.

Buck, (Robert Clarke & Co., Cincinnati, O.). This little pamphlet of 32
pages, is an essay read by Dr. Buck before the Liberal Club of
Cincinnati. The author tries to show that one truth has run all
through the Ancient Mysteries, and later, is even to be found in the
Christian Church. His hint on p. 22, that “the Apostolic Catholic
Church possessed the Secret Doctrine, that some of its clergy
apprehended the great truths, but that there was wisdom for the
priests and command for the people,” is full of truth. At the present
day the great Jesuit College possesses much knowledge of the
theurgy which is a part of the practice of the Secret Doctrine, and if
all the magical practices of the disciples of Loyola were known, the
Christian world would be startled. They know enough of forecasting
the future to fear all such movements as the Theosophical Society,
and have tried, as they still try, to undermine it within its own
borders.
 Anyone who reads Dr. Buck’s essay with a candid spirit, will agree
with him that one core of truth underlies all religions, and will feel
the refreshing influence of the author’s clear mind and solid sense.
Inworld.
[A poem taken from the January number of “The Dial,” 1842, the
organ of the Transcendentalists, edited by Ralph Waldo Emerson.]
Amid the watches of the windy night
A poet sat, and listened to the flow
Of his own changeful thoughts, until there passed
A vision by him, murmuring as it moved,
A wild and mystic lay—to which his thoughts
And pen kept time—and thus the measure ran:

All is but as it seems,

The round, green earth,
With river and glen;
The din and the mirth
Of the busy, busy men;
The world’s great fever
Throbbing forever;
The creed of the sage,
The hope of the age,
All things we cherish,
All that live and all that perish,
These are but inner dreams.

The great world goeth on

To thy dreaming;
To thee alone
Hearts are making their moan,
Eyes are streaming.
Thine is the white moon turning night to day,
Thine is the dark wood sleeping in her ray.
Thee the winter chills,
Thee the spring time thrills;
All things nod to thee—
All things come to see
If thou art dreaming on.
If thy dream should break,
And thou should’st awake,
All things would be gone.
 Nothing is, if thou art not,
From thee as from a root
The blossoming stars upshoot,
The flower cups drink the rain.
Joy and grief and weary pain
Spring aloft from thee,
And toss their branches free.
Thou are under, over all;
Thou dost hold and cover all;
Thou art Atlas—thou art Jove:—
The mightiest truth
Hath all its youth
From thy enveloping thought.
Thy thought itself lay in thy earliest love.

Nature keeps time to thee

With voice unbroken:
Still doth she rhyme to thee
When thou hast spoken.
When the sun shines to thee,
’Tis thy own joy,
Opening mines to thee
Nought can destroy.
When the blast moans to thee
Still doth the wind
Echo the tones to thee
Of thy own mind.
Laughter but saddens thee
When thou art sad,
Life is not life to thee,
But as thou livest,
Labor is strife to thee
When thou least strivest:—

More did the spirit sing, and made the night,

Most musical with inward melodies,
But vanished soon, and left the listening bard
Wrapt in unearthly silence—till the morn
Reared up the screen that shuts the spirit world
From loftiest poet and from wisest sage.

Outworld.
The sun was shining on the busy earth.
All men and things were moving on their way—
The old, old way which we call life. The soul
Shrank from the giant grasp of Space and Time,
Yet, for it was, her dreamy hour half yielded
To the omnipotent delusion—and looked out
On the broad glare of things, and felt itself
Dwindling before the universe: Then came unto the bard
Another spirit with another voice,
And sang:—

Said he, that all but seems?

Said he, the world is void and lonely,
A strange vast crowd of dreams
Coming to thee only?
And that thy feeble soul
Hath such a strong control
O’er sovereign Space and sovereign Time
And all their train sublime?
Said he, thou art the eye
Reflecting all that is—
The ear that hears, while it creates
All sounds and harmonies—
The central sense that bides amid
All shows and tunes and realities?
Listen mortal while the sound
Of this life intense is flowing!
Dost thou find all things around
Go as thou art going?
Dost thou dream that thou art free,
Making, destroying all that thou dost see
In the unfettered might of thy soul’s liberty?

Lo, an atom troubles thee.

One bodily fibre crushes thee,
One nerve tortures and maddens thee
 One nerve tortures and maddens thee,
One drop of blood is death to thee.
Art thou but a withering leaf,
For a summer season brief
Clinging to the tree,
’Till the winds of circumstance,
Whirling in their hourly dance,
Prove too much for thee?
Art thou but a speck, a mote
In the system universal?
Art thou but a passing note
Woven in the great rehearsal?
Canst thou roll back the tide of Thought
And unmake the creed of the age,
And unteach the wisdom taught
By the prophet and the sage?
Art thou but a shadow
Chasing o’er a meadow?
The great world goes on
Spite of thy dreaming;
Not to be alone
Hearts are making their moan
And tear-drops streaming,
And the mighty voice of Nature
Is thy parent, not thy creature,
Is no pupil but thy teacher:
And the world would still move on
Were thy soul forever flown.
For while thou dreamest on enfolded
In nature’s wide embrace,
All thy life is daily moulded
By her informing grace.
And Time and Space must reign
And rule o’er thee forever,
And the Outworld lifts its chain
From off thy spirit never;
But in the dream of thy half waking fever
 But in the dream of thy half-waking fever
Thou shalt be mocked with gleam and show
Of truths thou pinest for, and yet canst never know.

And then the Spirit fled and left the bard

Still wondering—for he felt that voices twain
Had come from different spheres with different truths
That seemed at war and yet agreed in one.

C.

Another Theosophical Prophecy.

In the first number of The Path was inserted a prophecy made

from certain books in India called Nadigrandhams, respecting the
Society.
This called forth from the N. Y. Sun, that model of journalism, a
long tirade about the superficial knowledge which it claims pervades
the Society on the subject of oriental philosophy. Unfortunately for
the learned editorial writer in that paper, he never before heard of
Nadigrandhams, which are almost as common in India as the Sun is
here, nor does he appear to know what a Nadi may be, nor a
Grandham, either.
But without trying to drag the daily press of this country into the
path of oriental knowledge, we will proceed to record another
prophecy or two.
The first will seem rather bold, but is placed far enough in the
future to give it some value as a test. It is this:—The Sanscrit
language will one day be again the language used by man upon this
earth, first in science and in metaphysics, and later on in common
life. Even in the lifetime of the Sun’s witty writer, he will see the
terms now preserved in that noblest of languages creeping into the
literature and the press of the day, cropping up in reviews,
appearing in various books and treatises, until even such men as he
will begin perhaps to feel that they all along had been ignorantly
talking of “thought” when they meant “cerebration,” and of
“philosophy” when they meant “philology,” and that they had been
airing a superficial knowledge gained from cyclopœdias of the mere
lower powers of intellect, when in fact they were totally ignorant of
what is really elementary knowledge. So this new language cannot
be English, not even the English acquired by the reporter of daily
papers who ascends fortuitously to the editorial rooms—but will be
one which is scientific in all that makes a language, and has been
enriched by ages of study of metaphysics and the true science.
The second prophecy is nearer our day, and may be interesting.—
It is based upon cyclic changes. This is a period of such a change,
and we refer to the columns of the N. Y. Sun of the time when the
famous brilliant sunsets were chronicled and discussed not long ago
for the same prognostication. No matter about dates; they are not to
be given; but facts may be. This glorious country, free as it is, will
not long be calm: Unrest is the word for this cycle. The people will
rise. For what, who can tell? The statesman who can see for what
the uprising will be might take measures to counteract. But all your
measures can not turn back the iron will of fate. And even the City
of New York will not be able to point its finger at Cincinnati and St.
Louis. Let those whose ears can hear the whispers, and the noise of
the gathering clouds, of the future, take notice; let them read, if
they know how, the physiognomy of the United States, whereon the
mighty hand of nature has traced the furrows to indicate the
character of the moral storms that will pursue their course no matter
what the legislation may be. But enough. Theosophists can go on
unmoved, for they know that as Krishna said to Arjuna, these bodies
are not the real man, and that “no one has ever been non-existent
nor shall any of us ever cease to exist.”
 Correspondence.

THEOSOPHY.
[A LETTER FROM A FRIEND.]
Dear Brother:
“It rejoices us all here more than I can tell you, to know that you
have made such a start in America with Theosophy. We have had so
many things to pull us back, that it has been quite as much as we
could manage to keep our heads above water, and this not so much
from the action of our enemies as from the apathy of our friends. It
is strange to me to see how little faith there is in the power of truth,
even among those who ought to realize this most strongly. Why
should we fear and fold our hands when men speak evil of us or of
the cause, why should we imagine that any attack on individual
members can effect the position we take as a group or that
theosophy can be endangered thereby? How few understand what
theosophy is; they look upon it as solely an intellectual movement
that can be damned by the folly of its adherents; they little dream of
the strength that underlies the apparently inconsistent workings of
this manifestation of truth which we call the Theosophical Society.
And there is one thing which I believe establishes more than any
other, the fact that the Society as a whole has true vitality within it,
and that is the visible action of Karma in its developments.
“See how the mistaken value given to phenomena in the early
history of the Society, brought immediately its Karmic development
in the troubles then, and whenever any undue importance has been
given either to individualities or any particular line of practice, it is
always on that particular point that the next attack comes. So that
while fully realizing that as an organization, the T. S. is defective in
some things, I yet believe that there is a power within it that will
purge it from its defects and carry it on in spite of the attacks of its
enemies and what is worse still, the follies of its friends. What I do
feel more and more is the necessity that we should remember and
constantly keep before us what it is we are working for and not think
we accomplish our end when we number our converts in the world
of fashion, and gather around us men and women who vainly hope
for psychic powers and the arts of fortune telling and reading the
future. I do not fear black magic in our midst, but I do feel very
strongly that there are many who will sink to the level of mere
wonder-seekers and that they will become the prey of elemental
influences.
“What can be done to make men realize, as you say, a sense of
universal brotherhood and the true meaning of Theosophy. Well, let
us join you in America and the few here who do realize that
psychism is not spirituality, and let us try to stir the hearts of men
with the living truths of Theosophy.
“I am most anxious, and have been for a long time, that we
should address ourselves to another stratum of society than that
(the intellectual and the fashionable) which we have sought. It is not
that I would depreciate intellect; if I err in that matter it is in putting
too much stress on intellectual development. But I am beginning to
realize that the lower intellect can only deal with physical facts and
that it can never develop ideas; these can only be apprehended by
the higher intellectual faculties, and the ethical and emotional nature
of man has also its higher and lower aspects.
“I wish very much that we had a literature calculated to appeal to
the general masses, and I think that we should resolutely turn our
attention to this object. I think the little book that Dr. Buck has just
published very useful and I should be glad to see many more such
little works treating of the various points of doctrine such as
Reincarnation, Karma, &c. It is also encouraging to see such efforts
as that contained in the small book lately out—What is Theosophy?
Doubtless, in connection with that, for it seems to have been written
for the author’s children, you will call to mind what was written by
one of the adepts, not so long ago: ‘there is a great likelihood that
the sons of theosophists will become theosophists,’ and will quite
agree with me in the idea that we need a literature, not solely for
highly intellectual persons, but of a more simple character, which
attempts to appeal to ordinary common sense minds, who are really
fainting for such mental and moral assistance, which is not reached
by the more pretentious works. Indeed, we all need this. It is
fortunate that we have been able to live through the tide of mere
psychism and bare intellectuality which threatened nearly to swamp
us. And you know to whom we owe our escape, and now, that there
are ten or twelve members left who are prepared to work on
independently of perturbation, I think it a clear gain. What does it
matter to us whether H. P. Blavatsky has or has not fulfilled all of her
duties, or whether investigation has cast doubt into the minds of
some. In so far as she has done her duty, her work will remain, and
if perchance she has come to the end of her capabilities—which I do
not admit—it is for us to carry on what she has thus far done.
“In America I hope you will not fall into running after wonders and
psychic gifts to the detriment of true philosophical and moral
progress.
“Believe me to be, fraternally yours, A.”

Note.—The whole of this letter should be carefully studied,

and in particular the point that Karma brings its attacks just on
the point or persons where or by whom stress has been laid on
phenomena. It may be accepted as almost axiomatic by our
members, that if any group or single person has paid too undue
attention to phenomena, to astralism, psychism, or whatever it
is called, there will develop the next trouble or attack upon the
Society. It has been authoritatively stated by one of the great
Beings who are behind this movement, that it must prosper by
moral worth and philosophy, and not by phenomena. Let us well
beware then. Phenomena, powers—or siddhis as the Hindu say
—are only incidental. Our real object is to spread Universal
Brotherhood, in which task we necessarily explain phenomena,
but the Society is not a Hall for Occultism, and that has also
 been asserted by an adept in India in reply to letters written
him by certain well-known Englishmen who desired to establish
a Branch then which should control all literature and
phenomena. There are no secrets to be given out to any select
persons, for no one receives a secret inaccessible to the rest,
until he has acquired the right to it, and the proper sense to
know when and to whom it is to be given out.—[Ed.]

WHAT IS THE UDGITHA?

Jamestown, April 16th, 1886.

Dear Brother:—Will you kindly explain, through The Path, what
is to be understood by the Udgitha, or hymn of praise to
Brahm? With best wishes for the success of your enterprise, I
remain,
Fraternally yours, L. J.

This is a vital question. It may have arisen from the peculiarity of

the word inquired about, or it may be that our brother really knows
the importance of the point. We refer him to the article upon OM in
the April number. Om is the Udgitha, and OM has been explained in
that article. Read between the lines; and read also the “Upanishad
Notes” in this month’s Path.
In the Maitrayana-Brahmana-Upanishad, (Pr. VI), it is said: “The
Udgitha, called Pranava, the leader, the bright, the sleepless, free
from old age and death, three footed, (waking, dream, and deep
sleep), consisting of three letters and likewise to be known as
fivefold, is placed in the cave of the heart.”
This is the Self. Not the mere body or the faculties of the brain,
but the Highest Self. And that must be meditated on, or worshipped,
with a constant meditation. Hymn of praise, then, means that we
accept the existence of that Self and aspire to or adore Him.
Therefore, it is said again, in the same Upanishad:
 “In the beginning Brahman was all this. He was one, and infinite.
* * * The Highest Self is not to be fixed, he is unlimited, unborn, not
to be reasoned about, not to be conceived. He is, like the ether,
everywhere, and at the destruction of the Universe, he alone is
awake. Thus from that ether he wakes all this world, which consists
of (his) thought only, and by him alone is all this meditated on, and
in him it is dissolved. His is that luminous form which shines in the
sun, and the manifold light in the smokeless fire. He who is in the
fire, and he who is in the heart, and he who is in the sun, they are
one and the same. He who knows this becomes one with the One.”
Now “to know” this, does not mean to merely apprehend the
statement, but actually become personally acquainted with it by
interior experience. And this is difficult. But it is to be sought after.
And the first step to it is the attempt to realize universal
brotherhood, for when one becomes identified with the One, who is
all, he “participates in the souls of all creatures;” surely then the first
step in the path is universal brotherhood.
The hymn of praise to Brahm (which is Brahman) is the real object
of this magazine, and of our existence. The hymn is used, in the
sacrifice, when verbally expressed, and we can offer it in our daily
existence, in each act, whether eating, sleeping, waking, or in any
state. A man can hardly incorporate this idea in his being and not be
spiritually and morally benefited.
But we cannot fully explain here, as it is to be constantly referred
to in this magazine.—[Ed.]

Theosophical Activities.

Aryan Theosophical Society of New York.—This branch has

established the nucleus of a library to consist of Theosophical,
Metaphysical, Occult, Aryan, and other literature. It already numbers
about fifty volumes, some of which are loaned pending further
accumulations and the acquirement of a proper place to keep them.
It is hoped that this will grow to be of great value. A fund for the
purpose has also been started. During April the contributions have
been: A Friend, $5; Mr. B. X., $3: C., nine books: Hist. of Witchcraft
in Salem; Zend Avesta; What is Theosophy?; Mother Clothed with
the Sun; Footfalls on the Boundaries of Another World, &c.; from Dr.
Seth Pancoast, Red and Blue Light.
The books will be loaned to resident members upon giving receipt
for a definite period. Donations of books or money towards the fund,
can be sent to The Path, or the Pres’t of the A. T. S., box 2659, New
York City.
Several other books are promised and will be in hand before next
month.
The Branch is actively engaged in spreading Theosophical
literature, and now has requests for books from all parts of the U. S.
It has reprinted Mrs. Sinnett’s “Purpose of Theosophy” very cheap in
form, but well done, and has other reprints in mind. Since last
month, permanent quarters have been obtained, where the library
will be established. Private meetings are also held from time to time
among the members, for study and discussion.
Mr. C. H. A. Bjerregaard finished his course of lectures on “Historic
and Individual Cycles.”
All inquiries should be addressed to the Secretary, Box 2659, New
York City.

Cincinnati.—Since our April issue the members here have been

steadily at work, and among other things accomplished, is the
printing of Dr. Buck’s essay upon the “Secret Doctrine of the Ancient
Mysteries.”
 Boston.—Interest in Boston continues unabated. A member of the
Aryan Branch of New York has been spending a month in Boston,
discussing the philosophy and ethics to be found in theosophical
literature, and it is to be hoped that the work done will be
permanent, founded as it is in ethics and not upon phenomena.

Bullel.—Brother Krishnarao B. Bullel, a Bombay member, who has

been studying medicine in New York, and who constantly attended
the meetings of the Aryan Branch, graduated from the Homœopathic
Medical College, of New York, with honors. He sailed for home on
April 14th, on the steamer America, intending to stop in London. He
carries back with him the best wishes of his American brothers, and
a good report of the progress of the Cause here.

Olcott.—Col. H. S. Olcott has lately been in Ceylon looking after

the work there. Rev. Mr. Leadbeater was with him, and will remain
on the Island, where Theosophy is very strong, to work for the
Society. A theosophical paper, in Singhalese, was started there some
years ago, and still flourishes. The Colonel has just recovered from a
slight attack of fever contracted in his journeys, but his vigor
remains unabated.

Exposures.—In reply to several inquiries made here, and also sent

to London from the U. S., we beg to say that it is true that the
Society for Psychical Research sent a prejudiced expert to India, who
exposed nothing except his own bias. Among other things, he
thought he had proved that the writing of alleged adepts was only
Mme. Blavatsky’s disguised hand. But since then, a well-known
German member has submitted specimens of adept writing, together
with Mme. Blavatsky’s, to one of the best calligraphic experts in
Germany, who certifies that the messages which have been
impugned were not written by her.
Mme. Blavatsky is now in Europe, for her health, but she may be
expected to return very soon to India, spy-theory and missionaries,
to the contrary notwithstanding.

The American Board of Control.—The general and routine work of

the Society in America, is under the jurisdiction of the Board of
Control, of which the Secretary is Elliott B. Page, 301 South Main
Street, St. Louis, Mo.
A resolution has been passed by this Board, which is binding on all
members, that no publication shall be issued as a Theosophical one,
without previous consent obtained from the officers of the Board.
This is wise, as it will tend to prevent unauthorized declarations of
so-called Theosophical doctrine from being laid at the door of the
Society. All members, therefore, intending to make publication,
should address the Secretary of the Board.

Yoga Vidya or the Knowledge of Yoga, is the name by which in

India psychic practices, or astralism, or seeking after astral-body
formation, or inducing clairvoyance and the like, is most
commonly known. At the same time, True Yoga, called Raja
Yoga, is a different thing. In the March Theosophist a member
writes giving the name of one who will instruct in these
practices, and the Editor replied:
“We cannot endorse the writer’s opinion as to the benefits of
Yoga Vidya. For one or two who succeed in it, hundreds fail and
 wreck both body and mind, through its dangerous practices,
and even if physical results are obtained they are not invariably
followed by spiritual illumination.”
It certainly thus appears that our Society is not in favor of
such practices, no matter if some of its members indulge in
them.

Admission to the Society is open to any person of full age, who is in

sympathy with its objects, willing to abide by its rules; and is
obtained by signing an application which sets forth the above in a
form which is provided. This must be countersigned by any two
active members in good standing. The entrance fee is $5 and one
belonging to a Branch should also pay the annual dues thereof.
Applications can be made to Presidents of Branches or other officers.
Persons may become members of Branches or unattached members
of the General Society.

All that we are is the result of what we have thought; it is

founded on our thoughts; it is made up of our thoughts. If a
man speaks or acts with an evil thought pain follows him as the
wheel follows the foot of him who draws the carriage.
All that we are is the result of what we have thought; it is
founded on our thoughts; it is made up of our thoughts. If a
man speaks or acts with a pure thought, happiness follows him
like a shadow that never leaves him.—Dhammapada.
Receive this law, young men; keep, read, fathom, teach,
promulgate and preach it to all beings. I am not avaricious nor
narrow minded; I am confident and willing to impart Buddha
knowledge, or knowledge of the self-born. I am a bountiful
giver, young men, and ye should follow my example; imitate me
in liberality, showing this knowledge, and preaching this code of
 laws and conduct to those who shall successively gather round
you, and rouse unbelieving persons to accept this law. By so
doing ye will acquit your debt to the Tathagatas.—Saddharma
Pundarika.
OM

The great All, which is constantly in motion, and is constantly

undergoing change in the visible and invisible universe, is like
the tree which perpetuates itself by the seed and is incessantly
creating the same identical types.—Book of Pitris.
Nothing is commenced or ended. Everything is transformed.
Life and death are only modes of transformation which rule the
vital molecule from plant up to Brahma himself.-Atharva Veda.

THE PATH.

Vol. I. JUNE, 1886. No. 3.

The Theosophical Society, as such, is not responsible for any

opinion or declaration in this magazine, by whomsoever expressed,
unless contained in an official document.
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