Table I

Cards and Envelopes Journal

If purchases are itemized elsewhere for reference, such an account as this may contain sufficient data. It is possible to itemize more fully in this journal record if desired, as is illustrated in Table II.

Table II

Itemized Accounts

In the second table it will be noted that the terms usually employed in bookkeeping are introduced. These are easily understood. The term "By" introduces all terms belonging to the credit or receipt column; the "To," items of the debit or expense column. The abbreviation "Cr." for credit heads the column of receipts, indicating that the house account has that much more to its credit, while the "Dr." abbreviation for debit shows to what extent the house has become indebted or has placed itself under obligation for benefits received.

Table II also includes a column for daily totals, which carries the account a step further in efficiency. In the final footing up of the columns these totals are a convenience, since it is always easier to add a short list of large figures than a long column of small items. It is sometimes helpful also to be able to refer to the entire day's expenditures.

As will be readily seen, the details of expenditures, when entered as above in the journal, are not easily referred to. One could at any time make a summary of any division which would show the amount spent for any one class of purchases, as clothes, rent or food. As a matter of fact, few seem to make such reviews when the accounts are kept in this way, finding it a seemingly endless task to assort the different items after they have become so thoroughly confused as they do in the journal account. In this way the greatest benefit of an account is lost. Their highest value is in one's being able to bring each set of expenses together, so that comparison of different divisions may be made, and a proper proportion maintained. It is far better to transfer the details of an account to a second book, called a ledger, which may for convenience be divided into sections, each devoted to its particular class of items.

The number of credit accounts should be limited to as few as possible, usually to grocer, butcher and doctor. Frequent settlement of such accounts should be made. The family physician has too frequent occasion to comment upon the unbusiness-like way that family bills are allowed to accumulate from year to year without attention. If a physician is tardy on his side and does not present bills promptly he is usually agreeably surprised to have it called for, as it should be. The most complete and concise way of recording the facts to be preserved is to be found in the combination of journal and ledger, such as is illustrated in Table III. This will prove in the end to be one of the most convenient, suggestive and helpful arrangements yet devised. Opposite pages of an account book may be used, the left-hand page for the journal record, the right-hand for the ledger. The ledger items are classified under a few typical heads and the amounts expended for each are entered apart from the whole. This lenders it very easy at any time to consult any one division, where all the record is clearly before one. The divisions used correspond to those suggested in the discussion of Division of Household Expenditures, page 21. These are optional both in character and number, but will in the main prove to be excellent general heads. Others may suggest themselves as desirable for an individual family. Multiplication of details must be avoided as far as possible, to avoid confusion. Particulars as to prices paid may well be left to the pass books or bills of butcher or grocer, or in a separate memorandum book.

Combination Journal and Ledger

Table III

In carrying on weekly or monthly accounts with butcher, grocer or at dry goods stores various methods are employed for keeping a memorandum of the character and size of purchases made. If slips are sent with the goods when delivered they should be preserved on file, to be compared with the bill when rendered. Pass books are sometimes used. In that case the entries should be made in the presence of the purchaser, to avoid error or deception.

Household accounts should be balanced at least every week. A daily verifying with cash on hand is easiest and saves time in the end. These daily balances may be indicated in pencil as the aim is to prove the account to be correct, thus showing that no item has been omitted. Every month's accounts should be balanced on the last day of the month and a new page opened for a new account for the next month. The first item on the new page should read as in Table II, "By balance brought forward------"

One should set a time for the final balancing of accounts and opening a fresh record. This is usually done at the close of the calendar year, although another time might be more convenient, as the holiday season brings other extras demanding time.

The facts to be preserved on a balance sheet are available after this summary of the year's expenses is made. The purpose of a balance sheet is to preserve from year to year a statement of the final condition at the end of each year for helpful comparison. It may be that the income has not been sufficient to meet the demands upon it, when a deficit with appear. Or the income may be just enough to cover expenses, or there may be a balance of the credit side. A properly managed household will show a steadily increasing gain of this nature, provided no exceptional and unexpected bills arise such as result from long illness and the like.

An example of a properly managed entry and a satisfactory showing is given in Table IV.

Yearly Balance

Balance Sheet

Household Account Book, with division of income, 64 page, cloth bound, 50 cents, from the School.