Knowledge that Transforms

Abstract The article presents intermediate accounting instructions in the year 1955. Instruction in intermediate accounting was surveyed through a questionnaire that was sent to 100 colleges in the spring of 1955. Answers were received from two-thirds of the colleges. The survey dealt with the state of instruction as it is, rather than as it might be, but the latter aspect was not entirely overlooked. The course seems to be firmly established in schools offering a more or less complete study of accounting. Schools with a three-year program in accounting offer the intermediate course in the second year, typically for the full year. The force of this impression is reduced, though not materially, by two further disclosures. Second, certain topics in a book were omitted, even in a year course. Leading the list of topics omitted is review of accounting process, which was mentioned 4 times. In the survey, it was asked that should the teachers be tagged for intermediate accounting as one of the specialized fields in which to teach. The answers received show that 31 schools regard the intermediate course as a specialized field, 16 do not, rotating teachers; have combination policies, and 12 pursue no positive policy on the question.

Reviews the book "Public Accounting Practice and Accounting Education," by Donald P. Perry.

Reviews the book "Municipal Public Works Cost Accounting Manual," by Walter O. Harris.

Abstract Accountancy and economics have the same objectives of cognition. Both branches examine the individual economic cell as well as the entire economic body of a country. In the center of these studies are the administration of scarce resources and the determination of income and production volume. It is often emphasized that the economist assumes the national, community or social point of view while the accountant is limited to the individual enterprise. But actually both branches have sections which deal with the national economy, that is, with the economic organism as an entity, or with the link between two or more national economies and both have sections dealing with firms, that is, with the ultimate bricks of this more highly organized structure. Business accounting can be regarded as that part of accountancy which is engaged in the studies of the firm, and microeconomics is its counterpart in economic analysis, while national accounting on one side, and macro-economics on the other, are dealing with the over-all picture of the economy.

Abstract More than six years have passed since the Subcommittee on Terminology of the American Institute of Accountants recommended the discontinuance of the term surplus in accounting. This pronouncement has had considerable effect in accounting circles, and a definite trend away from the use of the condemned term can be perceived. It is true the economic meaning of surplus is different from its accounting signification. To the economist, surplus represents unearned income due to the inelasticity of the supply of any productive factor, conceptually more or less the same as the economic rent of land. The literature of both professions contains many articles comparing the dissimilar meanings of homonymic words common to the two disciplines, so that no student of either should be unduly misled by a different signification of the term surplus in the other profession. Certainly the economist has no greater claim to use of the term than has the accountant. With reference to the problem of the inclusion in capital or paid-in surplus of premium paid on capital stock, the major discussion in the legal decisions revolves around whether such premium on stock is available for dividends, each case interpreting the statute of a particular state.

Abstract The training of recruits for a profession is a topic of perennial interest to practioners of the art as well as to educators. This can be seen in a variety of circumstances, in the formal qualifications required of candidates for admission, in the many discussions of the problem which stud the literature, in the continuous existence of committees on education in professional organizations, in the responses of practitioners to invitations to appear before students, and in the occasional appointment of commissions to review the educational process. This concern is vital to the improvement of the profession and perhaps to its continued existence. For instance, the College of Accountants in Venice, which was founded in 1581 and later achieved a status similar to that of state boards of accountancy, admitted members to the college or society by requiring, first, a certificate of fitness from a magistrate, second, an apprenticeship of six years, third, a certificate from a magistrate on the legal attainments of the candidate, fourth, a declaration by the accountant under whom he had served as to his ability, fifth, an examination before a board of examiners, and sixth, another examination before the governing body.

Reviews the book "Governmental Accounting," by R. Merrill Mikeshell.

Reviews the book "Elementary Accounting," by Perry Mason, George Stenberg and William Niven.

Abstract The author presents a report on the American Accounting Association activities based on a partly delivered speech by the president of the Association as of April 1956. The author provides statistics on member participation in the Association, mentioning that many members participate in more than one activity. He explains the activities of officers and committees with an example, highlighting the fact that each officer or committee views the Association primarily in terms of its field. He discusses the joint education committee and their chairmen, who considers his committee to be the most important and their achievements in their fields. The author throws light upon the representation of the Association by its president and other members and its cooperative relationship with other accounting organizations. He briefly mentions the annual conventions and annual reports in the journal "The Accounting Review." He also discusses the question of increasing membership for the Association.

Abstract The author discusses the effects of inflation on the income of public utilities. He gives an introduction to the scenario of measuring corporate income following the inflation resulting from the world wars. He makes an attempt to measure the amount of the overstatement of income for the electric utility industry and fourteen individual companies. In studying the electric utility industry, he illustrates the adjustments made to depreciation charges in Table 1. He discusses over-statement of income and decrease in the real income of electrical utilities after converting them into dollars, using Table 2. He then enumerates the factors which give rise to the margin of error in assessing income. He explains the procedures followed in studying fourteen individual companies in face of certain defects in the study of the electrical utility industry. In Table 3, the author presents confirmation to the conclusions indicated in the study of the electrical utility industry, and a comparison of the operating adjusted income author shows that the results of the years 1940 and 1953, in Table 4, while in Table 5, the depreciation adjustment is not proportional to the depreciation charge. He presents a comparison between public utilities and other industries.