Chapter XXII
).
This simple method of keeping accounts enables one to look over the monthly and yearly expenses and to see if the expenditure is apportioned to the different divisions as it should be. If some of the needs of the physical or intellectual life are being neglected, it should be possible to cut down or readjust the next year to the satisfaction both of the housewife and of her family.
It is wise for all girls before they have homes of their own to keep account of their own small incomes. In many families daughters are given money for clothing and daily expenses. Some such system of keeping accounts as the above can be used. It is astonishing in examining accounts for clothing, to see how few maintain a correct balance. One girl found, by keeping accounts, that she spent entirely too much for hats and gloves and did not have the proper underwear to protect her body and maintain the correct temperature for health. Accounts help us to determine whether our methods of living measure up to the ideals or standards of life which we have established in order to live rightly.
=Methods of payment.=——Payment is either immediate, known as “spot cash,” or deferred. If deferred, the articles purchased are charged by the dealer, and a bill rendered the first of each month. When a charge account is opened, a good business reference must be given. According to another system, articles may be paid for in installments,——that is, so much each month, according to some agreement. Of this method it may be said that it is unsafe, or at least unwise, always. Remember that more is always paid in the end.
In either case the payment may be made in bills, specie, or by checks; although in ordinary shopping immediate payment is usually made in bills and specie.
The advantage of immediate payment is that the buyer spends only what she has, and does not count on future money. This method of payment enables one to keep the balance well in hand. It necessitates, however, keeping bills and specie in the house, and in one’s pocketbook, with the possibility of theft or loss; and cash payment takes more time in the shop, with the long wait for change. Sending “collect on delivery” (C.O.D.) is a way of making cash payment and saving time at the shop. Be sure that in this case there is the exact change at home, and some one ready to receive the goods.
Charging goods makes for economy of time. If you can remember that an article charged means money spent, this is a safe plan. One careful buyer says that she is too optimistic to have a charge account; too sure that while she has not cash enough to-day for something that she wants, she will surely have it by the first of next month.
There is another method of payment introduced by a few large department stores. The firm requires a monthly deposit at the first of each month and charges up purchases against this. This is good in so far that the customer is spending money that he really has, but it restricts purchases to that one shop, and this is inadvisable in the case of a small income.
=The bank account and check book.=——Whether payment is immediate or deferred, payment by check is a great convenience. It saves time and is also a record of money paid.
Select a bank, conveniently located, and recommended by a conservative business man. Take to the bank a letter of introduction, with the sum for deposit. The bank will record your signature, and give you a bank book in which is recorded the amount deposited. A check book will be given you that contains blank checks, and provides for keeping account of deposits and checks drawn. Each check has to be filled in, and signed with your name exactly as recorded at the bank, when you make a payment. This must be recorded in the proper place when the check is made out, stating date, amount, and payee. The sums paid out are added, usually for every three checks, and this sum deducted from the deposit, and the balance carried forward. In this way you may always know your balance in the bank, provided you are accurate. Great care must be taken to fill in the blank spaces correctly so that the check cannot be easily altered by any one.
If a check is made out to you, and you wish to cash it, or deposit it, you “indorse” it by writing your name on the back across the left-hand end of the check. The name must be written exactly as it appears on the face of the check. If by chance the name is misspelled, write it in with the correct spelling below.
The checks that you make out are indorsed by the payee in the same way, and cannot be cashed until so indorsed. Therefore, if a check is lost in the mail, you do not lose the money. The bank should be notified to “stop payment” on the lost check, and you can then send another check in place of the first one.
When you wish bills or specie, you go to the bank and present to the paying teller a check made out to “Cash” and signed by yourself. It is wise not to make out or sign such a check until you reach the bank, because if such a check is lost on the way, there is danger of its being cashed by the finder.
Once a month you should leave the book with the teller to be balanced. In a few days you may call for it, and will receive with it the checks that you have drawn, and that have been returned to the bank by the date to which the book is balanced. These checks are called vouchers. With these there is also a list of the amounts showing the total paid out on them by the bank. Check up the vouchers with the list, then check up the vouchers with your check book to see if all in your check book had been returned to the bank by the date of balancing. If there are some still out, add that sum to your check book balance, and then compare the bank book balance with your check book.
Deposits may be sent by mail, either with or without the check book. If the book is sent, it should go by registered mail. If you do not send the book, the bank will send a receipt, which you return with the book the next time the balance is made. In either case, write “For deposit” above your signature on the back.
EXERCISES
1. Of what value is business equipment in household management?
2. Suggest ways in which a card file might be used in the household.
3. Suggest a system for filing household letters; bills.
4. What should be one’s aim in keeping household accounts?
5. Estimate the cost of your clothing for the last year.
6. Name different methods of payment of bills. Which do you consider the best for the family with $1200 income?
7. Describe fully payment by check.
8. How should a check be indorsed?
9. How can one deposit checks by mail?
##