Knowledge that Transforms

Abstract In order to operate an enterprise well, management needs to plan future operations and maintain close control over materials and activities. One of the most useful techniques of planning is forward budgeting. Its figures are based on known intentions decided by high-level authority and on knowledge of the results of prior activities that grew out of prior planning. This necessary knowledge de- rives from detailed records (i.e. accounting) periodically compacted into summary reports. Of the many techniques of managerial control, several that are essential include to set up an operating organization and carefully provide for subdivided duties. It may be helpful if production standards are established as a guide to workers and supervisors. Secondly, provide trained personnel, plus suitable supervision, frequent inspection, etc. Although, present day accountants may justly take pride in the intricate techniques and the professional status of our independent auditors. Yet they can well afford now and then to acknowledge a large intellectual debt to generation after generation of unknown contributors to this art.

Reviews the book "Investment Management," by Harry C. Sauvain.

Reviews the book "Economics of Business Enterprise," by Leonard A. Doyle.

Reviews the book "Accounting and Accountant Management," by Harry Elmer Humphreys.

Reviews the book "Investment Principles and Policy," by Ralph R. Pickett and Marshall D. Ketchum.

Abstract The use of direct costing means its full fledged incorporation into the accounting process in terms of its effect on the determination of periodic net income and financial position. One of the most appealing results of the use of direct costing, particularly to the harassed and overworked cost accountants, is the elimination of all necessity of making any attempt to allocate fixed overhead costs, both initially to service and production departments and ultimately to units of product or jobs. Admittedly, simplicity in cost accounting methods with the attendant reduction in the cost of cost accounting represents a desirable objective, but only if the information produced by the simplified methods is not substantially less useful for internal managerial use as well as for use in reporting the operating results and financial position. An advantage often claimed for direct costing is that it focuses attention on the variable cost factors which are by their nature more subject to managerial control than those costs typically described as fixed. While it is perfectly true that management control is most important in connection with variable costs, it is difficult to see that direct costing offers more in this connection than a well organized system of standards for direct material, direct labor and variable overhead.

Abstract The article focuses on program planning and control through the budgetary process. The budget is an instrument which should guide the executive in planning and controlling the operations of the company, but it should never dictate the policies of the management. When properly prepared and executed, the budget document can, with a reasonable degree of accuracy, forecast the results of a proposed program before it is inaugurated. The budget in government is a financial plan for raising and spending money to conduct operations and to meet outstanding obligations. A distinction is made in public finance between annual or operating budgets, and long-term or capital budgets. The operating budget provides a plan and funds for the day to day operations of government while the capital budget concerns itself with new construction of major installations involving long-term financing. All too often budgeting has been based on the premise that the budget should be only a financial statement and a request for funds.

Abstract The article focuses on public accounting. The contention that generally accepted accounting principles are recognized and applied by public utilities is supported, although the utility industry must maintain a uniform system of accounts as prescribed by state and federal regulatory commissions. The field of public utilities consists of electric light and power; gas and steam heating, telephone, telegraph, and others. This utility from hereon will be referred to as the Company. The Company classifies its accounts in accordance with the prescribed system of accounts issued by the public service commissions. It files with the commission a copy of its manual of accounts and any changes that are made in the account classification. Certain account classifications are established to facilitate the allocation of costs. These classifications include the accrued and deferred accounts, work in progress, joint expenses and clearing accounts. Clearing accounts contain the accumulation of costs under similar account titles during the fiscal period, the amounts of which are transferred currently to the particular permanent account on some predetermined cost distribution basis.

Reviews the book "Auditing Procedures--An Introduction for the Student-in-Accounts," by H.C. Dell and J.R.M. Wilson.

Reviews the book "CPA Handbook."