A pleasant street in Palo Alto. Plush lawns. A man asked me to repair the wooden fence that separated his property from his neighbor. A small job. He said he'd pay me in full: "My neighbor should pay for half of it, since we share the fence, but Bella's such a cheapskate, I don't even want to deal with her."
When I show up, there's a problem: the man isn't home; his house is locked, and there's no outdoor power supply. I need to use my electric saw. Next door, Bella has an outlet on her porch.
I ring the doorbell. She's an old woman living alone in a nice house.
"I'm repairing the fence," I say. "Could I borrow a cup of electricity?"
"Whose paying for it?" Bella asks.
I'm surprised. Never been asked before. But: "Okay," I say. "I'll reimburse you for all the electricity I use."
She narrows her eyes. "How will you know?"
"Hm. I tell you what. I'll keep track of how long the saw is running. It's rated at thirteen amps, so at a hundred twenty volts I can calculate the number of kilowatt hours. Then we can calculate the cost."
From the look on her face, I can see that she doesn't know an ampere from a volt from a kilowatt hour. But she nods, pensively. "Okay," she says. "Cash."
I try to look as serious as I can. "I shouldn't pay cash," I say. "This will be a business expense, so I'll have to write you a check from my business account. Otherwise my accountant will get angry."
Bella thinks it over for a moment. "All right," she says. "I'll take a check. But then the IRS will think I'm getting taxable income, so you'll have to add twenty percent."
"Make it thirty."
"All right. I'll add thirty percent."
I repair the fence. It takes a couple of hours, which includes about five minutes total of running the power saw. Let's call it six minutes, which is an even 1/10 of an hour.
I put the tools away, coil the extension cord, ring the doorbell.
"I'm ready to pay," I say. "Shall we do the numbers?"
"Go ahead," she says.
I press buttons on my calculator, walking her through it:
13 amps X 120 volts = 1560 watts, or 1.56 kilowatts.I can see she doesn't follow any of this. "So you'll pay?" she says.
0.1 hour X 1.56 = 0.156 kilowatt hours of usage.
Current electric rate [this is 1981] is 6 cents per kilowatt hour.
Therefore I owe you 0.156 X 6 cents = 0.936 cents.
Adding 30 percent for tax purposes, 0.936 X 1.3 = 1.2168 cents.
I write a check. Generously, I round the 1.2168 up to a full 2 cents. Signing it with a flourish, I tear the check loose and hand it to her.
Holding the check at arm's length, squinting, she makes a careful study — date, signature, amount.
"Fair and square," she says.
Money in hand, stepping back into the house, Bella closes the door.