This section is from the book "Elements Of Construction", by Charles A. King. Also available from Amazon: Elements of construction.
Shellac. Shellac may be bought ready mixed, or may be cut by dissolving the gum in wood alcohol. In applying shellac finish, the wood should be first filled or stained; upon this, one coat is laid after another, each being rubbed down with pulverized pumice stone or No. 00 sandpaper, after which the next coat is spread. Upon ordinary work, two or three coats are usually sufficient, the last coat being rubbed down with sandpaper and oil, or with pumice stone and oil, after which it may be polished with a soft cloth. If a dead finish is desired, the final rubbing should be done with water instead of oil. Shellac should be laid in thin coats, since, if applied thickly, it will pit badly in drying, and make trouble in rubbing. Use the brush with quick strokes, never working over a place already covered, as a muddy place will result.
 
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