EVERY GIRL A BUSINESS WOMAN.
A PRACTICAL GUIDE TO THE WORLD OF INDUSTRY AND THRIFT.
By JAMES MASON.
W
ecome now to speak about the receiving and the paying away of money. These are things which, by common consent, are always done in a certain way. If they are done otherwise it shows either a want of sense or a want of education.
When money owing to any person is paid, a receipt for it should always be given—that is to say, it should be acknowledged in writing that the money has changed hands. If the receiver merely takes it and puts it in her pocket, she who pays will have no security, except the receiver’s good faith and good memory, against being called on to pay the sum a second time.
A receipt may be given in any form of words, but the following are correct forms for business purposes—
London, 15th September, 1886.£17 4s. 6d.Received from Miss Rose Hastaway, Chester, the sum of seventeen pounds four shillings and sixpence in payment of account rendered (or of annexed account.)Flora Malcolm.
London, 15th September, 1886.
£17 4s. 6d.
Received from Miss Rose Hastaway, Chester, the sum of seventeen pounds four shillings and sixpence in payment of account rendered (or of annexed account.)
Flora Malcolm.
Guildford, 12th July, 1886.Received from Mrs. Trundle the sum of six pounds seven shillings and ninepence, in payment of account to this date.£6 7s. 9d.Elizabeth Badger.
Guildford, 12th July, 1886.
Received from Mrs. Trundle the sum of six pounds seven shillings and ninepence, in payment of account to this date.
£6 7s. 9d.
Elizabeth Badger.
On all receipts for money amounting to £2 or upwards you must put a penny stamp. Not long ago there was a stamp sold expressly for the purpose, but now a penny postage stamp is used, which is much simpler. The stamp may be placed anywhere, but is best where the signature is, the signature being written across it. If the receipt of money is acknowledged in a letter, the stamp should be put at the end, just where you signyour name. It is always better, however, to give a separate and formal receipt.
The Government require that either the name or the initials of the person giving the receipt be put on the stamp,together with the true date of writing, the object being to show clearly and distinctly that the stamp has been used. Ordinarily the date is given in a contracted form, for instance, the two receipts given above would have “15. ix. 86” under the name of Flora Malcolm, and “12. vii. 86” under that of Elizabeth Badger. Figures representing the amount for which the receipt is given are often added also.
Whoever gives the receipt pays for the stamp, and the penalty for refusing to give a duly stamped receipt in any case where the receipt is liable to duty is £10.
When you receive money as a loan, you may acknowledge it by what is called an I O U, which is in this form:—
Carlisle, 3rd October, 1886.To Miss Alice Golightly,I O Uthree pounds ten shillings.Anne Winkle.
Carlisle, 3rd October, 1886.
To Miss Alice Golightly,I O Uthree pounds ten shillings.
Anne Winkle.
I O U’s are not much in favour in business; they are rather friendly documents than business ones.
An I O U does not need a stamp, whatever the amount may be, as it is simply an acknowledgment of a debt, and neither a receipt nor a promissory note—that is, a note giving a promise to pay at a particular time. Suppose Miss Winkle had written, “I O U Three pounds ten shillings to be paid on the 2nd of January, 1887,” she would have changed her I O U into a promissory note, which would have required a stamp.
But “neither a borrower nor a lender be”—which is another way of saying that I O U’s are to be avoided. When the money is repaid, the I O U, of course, is returned to the person who gave it.
In cases where money is received in payment of an account, and the acknowledgment is put on the account itself, the account is “discharged,” as it is called, in any one of the following ways. The person to whom the account is due writes on it her own name, and, preceding her name, the words, “Paid,” “Received Payment,” “Received,” or “Discharged,” or—if such be the case—“Same time paid,” or “Paid by cheque.”
Or this form may be used. Suppose the amount to be £25 10s. and the discount five per cent.
Should you be receiving payment for somebody else, you sign as you would a letter in similar circumstances. Thus:—
Same time paid,forMargaret Bell,Ellen Chapman.
or,
Paid by cheque,Mary G. Grove,perIna Meadows.
Some polite people, in discharging accounts write “with thanks” in the left-hand bottom corner or under their signature. In the case of tradespeople, it is a courteous phrase that sometimes goes a long way towards securing another order.
Receipts of all kinds should be kept for at least six years. After that time you may either continue to keep them or make a bonfire of them. The reason for your being then free to please yourself is that actions for unclaimed debt arising out of a simple contract are limited to six yearsfrom the date of the cause of action. After six years you are safe against being called on to pay the money a second time.
Bills are occasionally rendered a second time after being paid, not the least, perhaps, from an intention to defraud, but simply from carelessness. People omit to enter the money they receive in their books, and forget they have got it; and to keep all receipts is a way of protecting oneself against such a happy-go-lucky style of doing things.
Receipts should be folded in the same way as letters, and marked on the outside with all necessary particulars. Thus:—
12th August, 1886.Griffin and Constable,Manchester.Washing Machine£3 15s.
If you have a set of pigeon-holes, receipts should have a pigeon-hole all to themselves; if not, keep them tied up in a bundle and arranged in alphabetical order.
When you have to make out accounts always do it as neatly as possible. A neat account has a well-to-do air, and may do as much good to one’s credit sometimes as a handsome balance at the bank. Hard-up people are seldom neat either in accounts, or correspondence, or anything else.
Accounts or invoices in business are usually made out on ruled and printed forms, and are headed with the address of the seller. After that come the names of the buyer and seller, thus:—
Miss Rachel O’Flinn,Bought ofLeigh, Goldhawk, and Still.
Or the wording may be,
Miss Rachel O’Flinn,ToLeigh, Goldhawk, and Still,
which mean that Miss Rachel O’Flinn isdebtor tothe firm named, the word “debtor” being dropped in practice.
Below the names of the parties the terms of sale are sometimes put: “Nett Cash” or “Cash in 14 days,” or “Accounts rendered monthly,” or whatever the conditions are. Then follow the particulars of the goods sold, the dates when they passed into the hands of the purchaser being put in the left hand margin.
People who have any money transactions at all, and do not wish their affairs to get into hopeless confusion, must keep books of some sort—that is to say, they must adopt a plan of writing down their transactions in regular order for easy reference.
It may be a primitive method or a very elaborate one—that depends on the nature and requirements of the business—but some system there must be, and of book-keeping in at least its general principles every business woman should make a study. By its means we gain an exact knowledge of how we stand, we see what comes in and what goes out, how much we owe and how much other people owe us, and whether we are putting any of our money into bags with holes.
There are many good books published on the subject of book-keeping, and by all means study the best treatise you can get; but better than all books is actual practice. The experience of keeping an account of one’s own transactions for a week gives more insight than all the books that have ever been written. In a book, things seem sometimes exceedingly puzzling, whilst in reality they are simple enough.
The main fact to be grasped in book-keeping is the distinction between debtor and creditor; you must get it well into your head thatthe person or thing represented by an account is “debtor to” what he, she, or it receives, and “creditor by” whatever he, she, or it gives or parts with.
The simpler business books are the better, so long as they answer the purpose for which they are intended. They must be clear to the person who keeps them, and clear also to any who have to consult them. The utmost care should be taken with them, so as to have no blotting, no scraping out of figures, and no tearing out of leaves.
There are two ways of keeping books, known as single entry and double entry. Single entry is called so because each item is entered only once in the accounts of the ledger, which is the principal book. In double entry, on the other hand, it is entered twice, to the debtor side of one account and to the credit of some other account.
In this way, when books on the double entry system have all the sums on the debtor side and all the sums on the creditor side added up, the total amounts in both cases are the same. That is, if the books have been rightly kept and no mistake has been made in addition, like that of the man who spent a long time trying to make them come right, and found at last he had made the slight mistake on one of the sides of adding in the figures of the current year.
The object of double entry is to establish a series of checks so that mistakes are not likely to occur, and in all establishments of any importance this is the system adopted. Books kept by the other and simpler system of single entry afford no check upon themselves. “Errors in addition,” says Mr. A. L. Lewis, “which are as easy to make in hundreds of pounds as in pence, errors and omissions in posting or in carrying forward balances, any or all of which may entail serious loss, can only be prevented in single entry books by the most careful checking and rechecking every item, and no one, however sharpsighted, can always avoid making an error, and even failing to discover it when made.”
What is calledpostingin book-keeping is the operation of transferring items from one book to another, and arranging them there under their proper heads. The difference between the Dr. and Cr. sides of an account is known as thebalance.
Transactions are entered in their books by business people at once. They never put off making an entry till to-morrow, for they are well aware that there is no putting any dependence on memory.
They are constantly turning over their books, too, so as to keep their affairs fresh in their minds, and see in a general way how they are getting on. Then every little while they go particularly into all their accounts and strike a balance as it is called—that is to say, make out a statement of their assets and liabilities, and arrange things for a fresh start. The word assets, we may as well mention, stands for property or sums of money owing to anyone, and liabilities means just the reverse.
There are two mistakes often made in balancing books which a business woman must take care never to fall into. The first is to include bad debts—debts of which you are never likely to get a farthing, or, at best only a few shillings in the pound—on the same footing as if they were good ones. The second is to calculate that property we possess is worth what we paid for it, never considering that as a general rule things decrease in value every year through use and change of fashion and other causes. The only wise plan is to subtract from the first cost, every time we balance, a certain sum to represent what is termeddepreciation of property. All such deductions should be made with a liberal hand; no harm is done by estimating ourselves poorer than we really are, but many a one has been ruined by mistaken calculations, showing property to be worth a good deal more than it would fetch in the market.
When one person acts for another in moneymatters, a statement, called an account current, should be sent at regular intervals—say once a half year or once every twelve months—showing the transactions. Here is an example. For convenience in printing we shall place the Cr. side below the Dr.; but in practice the two sides should be placed alongside of each other—the Dr. side to the left, and the Cr. side to the right.
Miss Winifred Holt, Edinburgh, in account current withNathaniel Evans, London.Dr.1885.June30.To balance of last account£942Aug.3.Cash paid M. Perry on your account229Sept.27.Cash paid J. Short on your account4127Dec.12.Cash paid you8000£95196Cr.Aug.1.By cash received from B. Green on your account£5000”12.Cash received from W. Rae on your account3500Dec.Balance of account carried to your debit in new account10196£95196Errors Excepted.Nathaniel Evans.London, December 31st, 1885.
Miss Winifred Holt, Edinburgh, in account current withNathaniel Evans, London.
Errors Excepted.
Nathaniel Evans.
London, December 31st, 1885.
Here on the Cr. side we have all the sums received by Nathaniel Evans for Miss Winifred Holt, and on the Dr. side all the payments made to her or for her by him. Instead of “Errors Excepted,” before the signature, “E. E.” might have been written, or “E. & O.E.,” which last means “Errors and Omissions Excepted.” These guarded phrases, however, may be omitted. You may correct errors afterwards, whether they are there or not. If accounts of this kind, or, indeed, any accounts, are thought to be incorrect, the fact should be intimated to the persons sending themat once.
Book-keeping and the making out of accounts requires ability in calculation. Indeed, no one can succeed in getting a character for business capacity who has not all the rules of arithmetic at her fingers’ ends. The use of “Ready Reckoners,” “Interest Tables,” or such-like compilations, often saves, however, a great deal of trouble, even when people are quick at figures. Some pretend they can do without such helps, but they would be better to use them. We ought to avail ourselves of all the help we can get, and it is absurd to take roundabout ways of doing things when short cuts will answer the same purpose.
Besides understanding about the right method of keeping books and making out accounts, the thorough business woman will know well about the art of buying. Here we see how a knowledge of business ways may assist in the upbuilding of happy homes. One who understands the art of buying will return triumphant from marketing expeditions, and when she goes shopping there will be no fear of her wasting the contents of the family purse.
The good buyer does not spend much time in going her rounds. She has made herself familiar beforehand with the qualities of things, the methods by which they are adulterated, and the seasons when they are cheapest, and if the goods shown her are not what she wants, she says so, and no persuasive tongue can induce her to take them. “Much comment on the part of the seller,” says an American writer, “she regards as an incentive to be wary; and all pretences to confidential favours, unless proved to be such by undoubted documentary evidence, as a reproach to her understanding.”
She makes it a rule to deal with respectable people only, knowing that by that course she is best served, and you never find her very sharp-set on bargains. She knows better.
On the subject of bargains Mr. Charles Dickens, in his “Dictionary of London,” has some wise remarks. They specially refer to the metropolis, but they are applicable to all large towns over the country. Everywhere skilfully-baited traps are set for the unwary, though it is in London that the traps catch most victims and rogues reap the best harvest.
Bargains, Mr. Dickens points out, are to be met with, of course, but only by those who know very well what they are about. The numerous “bankrupts’ stocks,” “tremendous sacrifices,” and so forth, are just so many hooks on which to catch simpletons.
“One of the commonest tricks of all is that of putting in the window, say, a handsome mantle, worth eight or ten guineas, and labelled, say, £3 15s., and keeping inside for sale others made up in precisely the same style, but of utterly worthless material. If they decline to sell you the actual thing out of the window, be sure that the whole affair is a swindle. See, too, that in taking it from the window they do not drop it behind the counter and substitute one of the others—an ingenious little bit of juggling not very difficult of performance.
“Another very taking device is the attaching to each article a price label in black ink, elaborately altered in red to one twenty or five and twenty per cent. less. This has a very ingenuous air. But when the price has been—as it commonly has—raised thirty or forty per cent. before the first black ink marking, the economy is not large.
“Of course, if you do buy anything out of one of these shops, you will take it with you. If you have it sent, be particularly careful not to pay for it until it arrives, and not then till you have thoroughly examined it.
“When a shop of this kind sends you ‘patterns,’ you will usually find a request attached not to cut them. Always carefully disregard this, keeping a small piece for comparison.
“There are, however, some houses where, if you at all understand your business, real bargains are at times to be had.”
The business woman is not often to be seen at auctions either, and if ever she does go, she makes sure beforehand that the sale is to be conducted on strictly honourable principles, and presided over by an auctioneer who is above suspicion. She is well aware that there are many unscrupulous individuals who, under cover of an auctioneer’s licence, lend themselves to transactions the reverse of honest.
For example, in company with a band of “followers,” as they are called—back-street brokers and “general dealers” of shady character—auctioneers of this sort take a dwelling-house, and cram it with worthless furniture. Then, after a month or two, the whole is seized under a fictitious “bill of sale,” to give the affair an appearance of genuineness, and the trashy goods are disposed of by auction to the unsuspicious public, the rogues dividing the spoil.
Another plan is to get possession of a shop in a frequented thoroughfare, and, day after day, beguile innocent folk to enter the premises, and then wheedle and bully them into bidding for and buying a lot of rubbish at four or five times more than its actual worth. It is quite a mistake to suppose that goods disposed of “under the hammer,” as it is termed, must necessarily sell for less than their real worth.
These mock auctions are swindles pure and simple, and what the initiated call “rigged sales” are not much better. These take place at auction rooms of more or less legitimate position, are usually held in the evening, and consist chiefly of articles vamped up or made expressly for the purpose. No one should go to them who wants to get value for her money.
In all dealings with tradespeople, a good business woman will do her best to pay cash. As she does this, she always goes to ready-money shops. Shops that give credit must charge higher prices, for they must have interest for the money out of which they lie; and, besides, they must add to the price of their articles to cover the risk that some of their customers will not pay. Those who do pay, pay not only for the credit they get themselves, but for the failure of others.
Now and again, however, to postpone paying one’s debts has an advantage, as was the case with a merchant whom Southey, the poet, once met at Lisbon. “I never pay a porter,” said this merchant, “for bringing a burden till the next day; for while the fellow feels his back ache with the weight he charges high; but when he comes the next day, the feeling is gone, and he asks only half the money.” But it is not often that one has the chance of getting a reduction in this way.
The cash buyer has many advantages, not the least being an easy mind and a knowledge at all times of what she is worth. Let every girl, then, keep in mind for the rest of her days the remark of the American writer, who said, “I have discovered the philosopher’s stone. It consists of four short words of homely English—‘Pay as you go.’” The easiness of credit has been the ruin of many people, by inducing them to buy what they could not hope, unless by a miracle, ever to pay for.
So much for the business woman in her dealings in a private capacity with business people. In a business capacity, however, one must sometimes both give and receive credit. But, it cannot be said with too strong an emphasis, the less of it the better.