Knowledge that Transforms

Abstract The research program of any college of commerce ought to give first consideration to the educational situation but the second function is also a matter of importance particularly when it will always be necessary in undertaking any business research to get the cooperation of businessmen who can furnish with proper facilities. There are certain studies that are growing out of those that were previously made. One of these is a study of the unit selling expense and involves a comparison between those establishments which employ salesman on a commission basis, those where salesman are employed on a salary basis and those concerns which employ salesman on a mixed basis. The independent accountants who are the accountants, one might say, of Ohio and particularly those who do not represent the large accounting firms with many branches are interested in a project that will involve a study of expense ratios and balance sheet ratio with which one is familiar. Whether the accounting firms will cooperate by furnishing with information in regard to revenue statements and assets has not been fully determined. Two studies are being conducted at Ohio State which have not been classified as accounting studies and yet which seem to be likely to degenerate into accounting studies. One of these is the study of merchandise control.

Abstract The accrual method of accounting is commonly accepted as the most scientific and accurate method of handling accounts. Yet, in spite of this fact, a great many banks fail to realize the significance of the accrual principle. The accrual system is also especially valuable in affording an excellent check for the bank, and particularly so where the auditor or comptroller at the central bank wants to supervise the operations in the various departments of the main office and branch banks. This is the result of the fact that accruals must sooner or later be paid off in cash. At the same time, an accrual system that it is worth while to operate must be simple enough in application to be readily understood by the average bank clerk, comprehensive enough to cover all of the various operations in the banking business, and, most important of all, accurate enough to constitute an actual audit and control of the income and expense accounts. A satisfactory accrual system cannot be constructed overnight, but involves intensive and detailed study. It must not only provide for the accounting of accruals, but must also guard against undue duplication.

Reviews the book "Cost Accounting Principles and Practice," by J.P. Jordon and Gould L. Harris.

Abstract The conduct of business enterprise is the source from which accounting theory takes its rise. When business enterprise worked with relatively undeveloped resources and through a relatively undeveloped technique of production, the circumstances of its operation were comparatively unstable. The conduct of enterprise did not run in exact terms. Managers had to be satisfied with approximations. But in modern times a high degree of technological development has been accompanied by an increasing size and complexity of business organization. Management has come to Include coordination of a great variety of activities. Business control has come to rest upon exact management and appraisal of both business and technological facts. If it is true as above stated that accounting does develop out of practical business administration affairs, then this fundamental changes in the circumstances of business administration should be reflected in accounting technique. Accounting theory grew up as a body of rules or principles governing the application of double entry technique to the affairs of business enterprises. But as business administration has changed in character an accompanying change has taken place in the technique used by it. Much statistical technique not included in the double entry record has made its appearance in the accounting system.

Abstract The article discusses on a speech delivered by the secretary of American Society of Certified Public Accountants W.L. Harrison. Those primarily interested in accounting felt that when the law was originally passed that experience was the primary method by which a man fitted himself to practice public accountancy. They established the requirement of five years' practice and only a high school education; flat same restriction is imposed today. A true profession it will be necessary for accountants to develop somehow a scheme of instruction that will eliminate to a large extent the necessity for practical experience upon the part of those who seek entrance into the profession. This Association is hiding its light under a bushel by not telling the rank and file of practitioners what one can do in the way of training a young man for entrance Into public accountancy. It depends upon the kind of education provided by this Association in educating the rank and file of C. P. As away from the idea, which prevails in the minds of, so many of them that accountancy is still something that must be learned, like bricklaying, by doing it. A revelation is going on sometimes rather strongly against the thought that the young man who has obtained his C. P. A. is entitled to a journeyman's wage. That false impression is to have thrown around the issuing of the certificate. Such is not the impression attaching to admission to the bar or the issue of the license to practice medicine

Abstract The interest in uniform accounting or standard accounting in the newsprint industry began to become manifest about ten years ago. In 1916 a firm of public accountants issued a report on the subject. And since that time fairly rapid progress has been made. The movement was greatly facilitated by the attitude that the Governments of the United States and Canada took regarding the cost of manufacturing and price, when the industry was controlled during the war. They insisted that definite costs should be arrived at and this greatly promoted accounting activities in the industry, so that much of the resistance to the development of uniform cost accounting, which has been found in other industries, was overcome in this way in the news print industry. Accountants were employed both by the Government and by the manufacturers to make extensive investigations of costs and related matters and these investigations disclosed the lack of reliable cost data and indicated the necessity for development.

Abstract The article presents information on the recent changes regarding the mode of instruction in Accounting. Among the matters considered were recent changes in courses that were given, developments in methods of Instruction, the possibility of granting a distinct degree in accounting and the possibility of the development of independent professional schools for students of accounting. It also presents a report by various committees on the trend of Accounting instruction. The report of the Committee on Publication Plan was presented by academician and chairman J. Hugh Jackson, and was adopted. Chairman W. I Goggin submitted the report of the Auditing Committee, with was duly accepted. G.A. MacFarland reported for the Resolutions Committee. Professor MacFarland included, informally, two resolutions which had been omitted in the report drawn up by the chairman of the Committee. One was a resolution of appreciation to the management of the Hotel McAlpin for the service rendered to the Association. The other was a resolution to extend greetings to professor Hatfield and to express regret that he was unable to attend the meetings.

Abstract The United Typothetae of America is thirty-nine years old. It began its accounting activities in 1909 and in that year our standard cost finding and accounting system was adopted. The principles of this system have been endorsed by each succeeding annual convention and in the main stand now as originally agreed upon. If two or more salesmen are employed, a separate account should be maintained for salaries and another for commissions. These accounts are then to be further analyzed and classified records kept of performance. If salesmen do work other than strictly selling, proper recognition should be given. An analysis of sales to ascertain to what extent this expense is recovered will be helpful. In arriving at the total selling expense, not only should the direct selling expenses be considered, but all other expenses such as stenographer time, telephone, telegrams, stationery and other incidentals. To make a monthly provision for bad debts is to face facts. Membership in a credit association should not be a substitute for this account. It may, of course, materially reduce the monthly allowance. In addition to making this monthly charge, a careful check-up should be made at stated intervals to ascertain if the monthly provision is adequate.

Abstract This article announces news from different universities and colleges of the U.S. as of June 1926. The courses in hotel management now being offered in the College of Home Economics include two required courses in hotel accounting and the general elementary accounting, from the Cornell University. Announcement has been received that a "System of Lessons of Accounting," by Professor C. Panayotopoulo, has Just been published. Darmouth College announces that Mr. Archie M. Peiseb, in charge of the accounting courses in the Amos Puck School of Business Administration and Finance, has been recently admitted to membership in the American Institute of Accountants. The following members of last year's staff have left the Institution, M. Watters, professor of commerce; Braddock, instructor in advertising; J. B. Hosmer, instructor in journalism; William T. Ward, associate in advertising from Georgia Institute of Technology. Mr. Rollin C. Bill is completing b's work for an M. B. A. at Harvard, specializing in accounting at University of California .