774 



THE HOME, FARM AND BUSINESS CYCLOPEDIA. 



This gives 42 days to count backward from the "basis" (May 9th) to 

 tind the date upon which the account is due by equitation, or the average 

 date of payment, which is March 2Sth. 



OO5. On averaging a past-due account, for the purpose of finding the 

 interest due, the average date when the account was due is first found, 

 after which we compute the interest on the account, from that date up to 

 the present at whatever rate per cent, agreed upon ; then, if it be an ac- 

 count owing us, we charge the same for the interest thus found ; or if it 

 be an account we owe, we credit the same for the interest. 



9O8. On averaging an account not yet due, for the purpose of set- 

 tling by note or acceptance, the average date when the account will be due 

 is first found ; then the note is either dated backward from that date the 

 number of days we wish the note to run, or dated on the present date, 

 and made to read in such a manner that it will fall due on the average 

 date due. 



907. The three days of grace is not added when averaging an ac- 

 count ; but it may be added after the average date is found, if we wish 

 to do so. 



908. Explanation of the "Interest Method" of Averaging Accounts. 

 We find the bill latest due, and taking this as a basis or foundation upon 

 which to work, suppose all amounts prior to that to run from their re- 

 spective dates due up to this " basis " date before they are paid, and 

 thereupon we charge or credit, as the case may be, interest on such 

 amounts for the time they thus run past due. After we have thus found 

 the total interest due, we find the interest on the amount of the account 

 for one day. Now we see by paying the sum total of all the bills just 

 one day backward from this "basis" date, there will be due the interest 

 for one day less, and consequently, we ascertain how many days backward 



