The general form of balance sheet known as the Continental form (or, in Scotland, as the Scotch form), places the assets on the left-hand and the liabilities on the right. The English form reverses this, but is seldom used in this country except in statements for use in England. The difference between the two forms may possibly be traced back to the balancing account, as it has been suggested that under the English method the accounts are shown as taken into the balancing account, while the Continental form shows them after they have been taken out of that account. It is more probable that the English practice has been brought about solely by the income tax acts of Parliament, which convey the impression that the forms of returns prescribed were prepared by those who were authorities on some subject other than that of accountancy.

Inasmuch as the Continental form of balance sheet is in general use throughout the United States, it is followed in this volume, especially as it appears more logical and more convenient to show any one class of accounts on the same side of the balance sheet and the trial balance.