escape from such a charge would be to divide the cost between sev-
eral years, upon the assumption that the expenditure would recur
perhaps once in four or five years. In that case a part of the cost might
be taken out of surplus and the rest out of the profit for the year,--
that is, a part would be taken out of accumulated profits shown on
the balance sheet and the rest would be included in costs on the
income sheet for the year just past. In subsequent years provision
should be made, in advance, for expected loss of this sort, allowing,
of course, for accumulations of interest. Unless the cost is extraor-
dinary, however, the cost should not be divided among several
years, for if the road has suffered in this respect the chance is that in
some other particular it has had especially good luck to offset this
bad luck. As was indicated in the earlier discussion of depreciation,
few years will depart far from the average.

Let us suppose next that the old bridge, which was of wood, is
replaced by one of iron. The cost will be very much greater. The
new iron bridge will better withstand the pressure of the ice and con-
sequently require replacement less often. Shall it be charged to con-
struction or to maintenance? In this case application may well be
made of the truth shown in the third illustration in Chapter VII.
Since it is expected that the bridge will be washed away in perhaps
ten years, its expected life at the end of the first year is nine years;
at the end of the second year, eight; and so on down. It is possible,
therefore, to charge to construction the cost of the iron bridge in
excess of that of the replaced wooden bridge, taking out of revenue
only that part of the cost which is equivalent to the value of the
old bridge, and then to "write off"--that is, to charge to revenue
--one tenth of the total at the end of each year, so that the cost of
the bridge as a whole will ultimately be taken out of maintenance,
each year suffering its share. If, on the other hand, it should be
thought that the iron bridge will withstand the pressure of the ice
so much better than the wooden one that it probably will not be
washed away at all, it would be perfectly proper to charge the excess
to construction account. The principle of this charge is, of course,
that the earnings of the road will be increased by the fact that this
heavy item of maintenance is to be escaped in the future, that the
road would cost more for duplication, and has actually cost more to
the builders. From all three points of view mentioned in the intro-

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