64. Cincinnati Ledger

An improvement on the old style ledger is shown in Figure 45 on page 92, having the debit and credit columns adjoining and a balance column. Every time a check is entered, the amount is deducted from the previous balance. The deposits are entered in the credit columns and added to the old balance to give a new one. If the account is overdrawn, the balance should be shown in red ink. This style of account makes it possible to watch the accounts very easily. The deposits made, the checks drawn and the balances in the account for a long period of time stand out prominently. Proofs should be made of this ledger not less than once a month. The use of an adding machine makes the task an easy one, if the postings have all been made correctly.

65. Interest Ledger

The form shown in Figure 45 on page 92 does not make any allowance for crediting interest on daily balances. Figure 46 on page 94 shows an interest ledger, which is very popular among trust companies. Interest is allowed on average daily balances maintained during the month. As the balances change each day, the method is to allow one day's interest on the total of daily balances for the month. If the balance remains unchanged during the month, it is multiplied by the number of days in the month and one day's interest figured on the total. If the balance changes during the month, the balance remaining on deposit is multiplied by the number of days it remained unchanged and carried to the aggregate column. At the end of the month the aggregate column is footed and one day's interest allowed on the total. Note that the sum of the days column equals the total number of days in the month. The tables used in figuring interest on deposits are prepared on a basis of three hundred sixty-five days to the year. The books are small and conveniently arranged so that figuring the interest is a very simple matter. Some companies who are looking after the small items that may be saved, use during leap year, special interest tables compiled on a basis of three hundred sixty-six days to the year. In a company with many millions of deposits, the saving is quite considerable.

Figure 47. Boston Ledger.