Knowledge that Transforms

Abstract Among the provisions of the constitution of the American Institute of Accountants, it is stated that one of the objects of the Institute is "to develop and improve accountancy education." The endowment fund was established largely for the promotion of this object; and for years the Committee on Education has been functioning with great vigor in an attempt to analyze and formulate the trend of accounting instruction. In previous regional meetings and in sessions of the Institute, educators have been called upon freely to express their ideas as to the problem which they have. Each year the recommendations which have proceeded from discussions have become more and more specific. Yet is appears that nothing has been said as to the importance to the academic field of the semi-annual examinations set by the Institute's Board of Examiners. Members of the teaching profession have regarded these examinations, especially since their adoption by thirty or more state boards of examiners, as furnishing important criteria for student instruction. No doubt the Institute's Board of Examiners, with appropriate professional modesty, would disclaim any effort, direct or indirect, to invade or in any way to influence the profession of teaching. But a denial of intent cannot alter the use to which the examinations have been put.

Reviews the book "Business Cycles and Business Measurements," by Carl Snyder.

Abstract There is always a certain amount of interest attached to the excursion of a state into the field of industry. This is not confined to the state itself, but usually manifests itself as well in even remotely located sister commonwealths. Because of the publicity given North Dakota's program of state ownership, it was thought that a paper dealing with some of the problems of its major industry would find enough interest to justify it. In order to understand clearly the nature of the organization and management of the state mill and elevator, it is necessary to touch briefly on certain acts of the legislature. In the first section of an act passed by the sixteenth legislative assembly of the State of North Dakota and approved February 25, 1919, is found the statement that "for the purpose of encouraging and promoting agriculture, commerce and industry, the State of North Dakota shall engage in the business of manufacturing and marketing farm products and for that purpose shall establish a system of warehouses, elevators, flour mills, factories, plants, machinery and equipment, owned, controlled and operated by it under the name of the North Dakota Mill and Elevator Association." In addition, this act provided for the manner of operation of the Association and the powers and duties of the persons charged with its management.

Reviews the book "Municipal Budget Making," by R. Emmett Taylor.

Abstract In recent times, many companies have cut selling cost materially because of better accounting control particularly of the field organization. Also, an increasing interest has been shown by sales executives in sales-cost accounting. The author attempts to show how sales-cost accounting can be made to aid sales executives. The discussion centers around defining and grouping, budgeting, and apportioning selling overhead costs. Various items which are charged to selling expense by some concerns are not so included by others. The wide variation in selling expense items no doubt to a large extent is due to the difference in the sales policies of organizations as well as a lack of a common conception of the functions of the sales department. Effective budgeting of expenses presupposes proper charting of the functions of an organization so that the responsibility of performing each function can be definitely fixed. It has been noted that cost of operating in each territory and the profit and loss of each give the sales manager a basis for reorganizing his sales districts so as to make the efforts of the sales people more effective.

Reviews the book "Motor Bus Accounting Practice," by Orville Augustus May.

Abstract The purpose of the present paper is to ascertain just what graduate courses in accounting are offered by the universities listed by the collegiate department of the United States Bureau of Education as giving graduate work in applied economics. In order to simplify the figures, no distinction is made between a term course and a semester course. Likewise, no distinction is made between courses given only to graduates and those given to both graduate and undergraduates; strictly undergraduate courses are ignored. Data presented in the article shows that the graduate courses in accounting are largely concentrated in the basic subjects. While twenty-one different accounting studies are given, 71.7 per cent of the courses are given in the subjects that a student already familiar with the elementary principles of accounting must pursue. In order to become a professional accountant; and although prospective Certified Public Accountants (C.P.A.) candidates form only a small portion of the total number of accounting students, it still is advisable to offer adequate preparation for the C.P.A. examinations. The relatively weak showing of the subjects not absolutely needed in the professional accounting curriculum is due to the fact that accounting must be studied in logical sequence.

Abstract The division of the profit and lose statement devoted to distribution costs is receiving much attention of late, and rightly so, as, in many companies, the cost of distribution is seemingly way out of proportion to the manufacturing cost of the product which is being distributed. Furthermore, from the statistics which are being gathered by different bodies it appears that not only is the cost of distribution generally heavy, but that it is tending to make up an even larger proportion of total cost as time goes on. Distribution costs depend entirely on the nature of the business and the variety of the product. It appears that the time is past for asking the question: Can we produce all the sales department can sell? That has come to be a comparatively easy matter with most industries and in fact the pendulum has long since swung to the other extreme. With the extraordinary development of modern machinery it is going to be an ever increasing task for the sales department to dispose of all the factory can manufacture. This being the case, it is natural that distribution costs should continue to creep higher proportionately. Management is, undoubtedly, realizing that the big problem before it is not only to dispose of what can be manufactured but to dispose of it economically so that in the sale thereof a profit will be maintained.

Abstract The article provides information about latest developments in the accounting department of various universities and colleges in the U.S., as of June 1927. H.H. Chapman, associate professor of accounting in the University of Alabama, will be on leave of absence for the year 1927-28. Chapman will hold a fellowship at Columbia University , where he will complete his graduate work. Chester H. Knight has been promoted to assistant professor of accounting and will have charge of the accounting work during Chapman's absence. Professor W.A. Berridge of Rhode Island-based Brown University leaves the department to go with the Metropolitan Life Insurance Co. as economist. A. F. Hinrichs will take charge of instruction in statistics and direct research activities of the Brown Bureau of Business Research. G. K. Bigge comes from the University of Michigan as assistant professor of economics in charge of the work in labor and business administration. Thomas L. Norton, instructor in economies, leaves to continue his studies at Columbia University.

Reviews the book "Auditing Procedure," by DeWitt C. Eggleston.