There is still another class of expense which calls for special treatment and which may be called "Advertising Expense." It consists of sums spent for newspaper and pamphlet advertisements, pictures, circulars, postage, etc., which, in the case of a large subdivision, soon become considerable.

Such items may be properly charged off directly to Profit and Loss, or they may be kept in an account by themselves and treated like the organization expenses of a new company. In the latter case there should be written off each year, either a fixed fraction of the whole sum, or an amount proportionate to the sales for the period. Such an arrangement, honestly carried out, is proper and just to all concerned. For instance, considerable sums in advertising might be spent in the last part of a fiscal period, while no sales might be reported until the following period, and if the whole expense (from which no benefit has yet accrued) is charged off, it might unnecessarily, or even unfairly, impair the dividend. At the same time, all such accounts should receive a careful scrutiny and should never be allowed to run beyond their allotted term.

Expenditures for current advertising and selling of any subdivision may properly be kept by themselves, and at the end of a fixed period be carried direct to Profit and Loss.