Transactions are entered in their books by business people at once. They never put off making an entry till to-morrow, for they are well aware that there is no putting any dependence on memory.

They are constantly turning over their books, too, so as to keep their affairs fresh in their minds, and see in a general way how they are getting on. Then every little while they go particularly into all their accounts and strike a balance as it is called—that is to say, make out a statement of their assets and liabilities, and arrange things for a fresh start. The word assets, we may as well mention, stands for property or sums of money owing to anyone, and liabilities means just the reverse.

There are two mistakes often made in balancing books which a business woman must take care never to fall into. The first is to include bad debts—debts of which you are never likely to get a farthing, or, at best only a few shillings in the pound—on the same footing as if they were good ones. The second is to calculate that property we possess is worth what we paid for it, never considering that as a general rule things decrease in value every year through use and change of fashion and other causes. The only wise plan is to subtract from the first cost, every time we balance, a certain sum to represent what is termed depreciation of property. All such deductions should be made with a liberal hand; no harm is done by estimating ourselves poorer than we really are, but many a one has been ruined by mistaken calculations, showing property to be worth a good deal more than it would fetch in the market.

When one person acts for another in money matters, a statement, called an account current, should be sent at regular intervals—say once a half year or once every twelve months—showing the transactions. Here is an example. For convenience in printing we shall place the Cr. side below the Dr.; but in practice the two sides should be placed alongside of each other—the Dr. side to the left, and the Cr. side to the right.

Miss Winifred Holt, Edinburgh, in account current with Nathaniel Evans, London.

Dr.
1885.
June30.To balance of last account£942
Aug.3.Cash paid M. Perry on your account229
Sept.27.Cash paid J. Short on your account4127
Dec.12.Cash paid you8000
£95196
Cr.
Aug.1.By cash received from B. Green on your account£5000
”12.Cash received from W. Rae on your account3500
Dec.Balance of account carried to your debit in new account10196
£95196

Errors Excepted.

Nathaniel Evans.

London, December 31st, 1885.

Here on the Cr. side we have all the sums received by Nathaniel Evans for Miss Winifred Holt, and on the Dr. side all the payments made to her or for her by him. Instead of “Errors Excepted,” before the signature, “E. E.” might have been written, or “E. & O.E.,” which last means “Errors and Omissions Excepted.” These guarded phrases, however, may be omitted. You may correct errors afterwards, whether they are there or not. If accounts of this kind, or, indeed, any accounts, are thought to be incorrect, the fact should be intimated to the persons sending them at once.