158 NATURE OF CAPITAL AND INCOME [CHar. IX

of articles consists; canceling by the oblique lines, we
have left but one item, $110,000, representing the « wear”
of the suits. The two methods must not be confused.
When we find by the method of couples that the net
income of $110,000 consists exclusively of the use of
suits of clothes, this does not imply that this net income
is all due to the stock of clothes. To discover to what
it is due, recourse must be had to the method of balances.
We thereby see that only $10,000 of it is due to the stock
of clothes, the remainder being due to the other capital
instruments in the table and most of all ($50,000) to the
logging camp. Combining the results of both methods,
we may state that the total net income from the specified
group of instruments consists of $110,000 worth of “ wear »
of suits and that this is due partly to the stock of clothes
and partly to other capital.
The two methods, that of balances and that of couples,
correspond in a general way to the two methods for
canceling liabilities and assets in capital accounts. The
method of balances gave, it will be remembered, the
amount of capital belonging to each individual ; the method
of couples showed of what elements the total capital consisted.


§9

We have now followed the cancellations to which interactions
 lead, whether they be interactions of exchange or
production. The case of exchange, however, needs further
consideration. Since every exchange consists of two transfers,
 and every transfer of two items, a credit and a debit,
the exchange evidently consists of four items in all, two
of which are credits and two, debits. These four may be
paired off in two ways, only one of which has thus far
been mentioned. They stand, as it were, at the four
corners of a square, as in the following scheme, which
shows the credits and debits involved when goods worth $2