Sec. 2] INCOME ACCOUNTS 123 
Next year we may suppose that the house is found to 
have rotted beams, is condemned, and must be abandoned 
or torn down. Its services are ended, but the land is still 
good and the owner can build a new house. This operation 
consumes, let us say, the first six months of the year 1901, 
so that during that period there is no income, but only outgo. 
During the second half of the year the house is occupied and 
its use is valued at $600. In the first six months not only 
did the “house and lot” fail to yield any income, but on the 
contrary occasioned an expense. The cost of production of 
the house was a disservice; for this was an “undesirable 
event’ occasioned by the house and lot. It was withstood 
only for the sake of future services which it would bring in 
its wake. It was not itself a desirable event. When we 
say, then, that any event is undesirable, we make ab- 
straction of future compensations. All disservices are 
“necessary evils”; they lead to good, but are themselves 
evils. 
We have, then, the following account: — 
Income For House anp Lor puriNg YEAR 1901 
  
Income Outgo 
Use of house and lot (six Expense of building 
months) 7, CL Lh $600 house +» aii.o. $10,000 
TAXOS. vv inbim ie 100 
$600 $10,100 
During this year, then, the house yields a net outgo of $9500. 
This adverse balance will be more than made up in the years 
which follow. For the year 1902 we may have the fol- 
lowing : — 
puts fertilizers on his land, this, his outgo, is the farm’s ingo. But, 
although we shall be largely concerned with income and outgo in 
relation to capital as their source, and might therefore logically 
employ the terms outcome and ingo, it seems preferable, for reasons 
of usage, to retain the usual terms, income and outgo.