When you record a money value in the database, it's best to understand the nature of the values you intend to store—especially the precision. For those of you that took computer science in school, you know that it's not possible to store some values in binary. For example, [1/3] is stored as .3333 (with a never-ending list of "3"s.) While the value might be close, if you add [1/3] + [1/3] + [1/3], you'll get .9999—you've lost some precision. Sure, with rounding, the result is returned as 1, but in some cases, you aren't permitted to round.
IMHO - In the early days of computing, clever programmers were able to strip off the extra precision (values less than a penny) and salt it away in another account. By the end of the week, they had accumulated a tidy sum—especially when millions of dollars were changing hands.
When you store a money value, be sure everyone knows the currency on which this value is based. This can help you from making a mistake when bidding on a project in the U.K., where the dollar is worth (at today's rate) about £0.529269. You might consider using a CLR-based user-defined type to keep the currency type stored with the value—especially if a single column can hold values from more than one currency.
The decimal datatype is listed (as shown in Table 1.1) under "Exact Numerics". That is, it's designed to hold an exact value. When you declare a decimal or numeric (they are equivalent), you also can declare the precision and scale (it defaults to 18). The precision is the maximum total number of decimal digits that can be stored—including the values on either side of the decimal point. To store a value of 1234.1234, you would need a precision of 8.
The scale indicates the maximum number of decimal digits that can be stored to the right of the decimal point—this must be a value from 0 to the defined precision. The default scale is 0, so unless you define a scale, your value will be stored as a whole number (without a decimal portion). You won't be able to define a scale unless you define a precision as well. For example (as shown in Figure 3.9), to define a column with a precision of 10 and four decimal places, you would code:
