Knowledge that Transforms

Reviews the book "Successful Speculation in Common Stocks," by William Law.

Reviews the book "Introduction to Accounting," by Alva L. Prickett and R. Merrill Mikesell.

Abstract The publication "An Epitome of Bookkeeping by Double Entry," by Thomas Turner, Professor and Teacher of Bookkeeping, at Portland, delineated on a scale suited to the faculties and comprehension for Senior School Boys and Youth designed for the Mercantile line. It is one of the earliest American specimens of textbook production in the field of commercial subjects. It has its place in the literature of education. Book-keeping by Double Entry is a system of charge and discharge. A Charge is a single entry, exhibiting the debtor side only, and does not form a complete account without the discharge amount of charge. The discharge, must be always equal to the amount of charge, consequently the total amount of the additions on the debtor side of all the accounts open in the ledger when posted up, must be equal to the total amount of the additions on the credit side, or otherwise there must exist an error either in the wrong addition of the sundries in the journal, or a wrong posting there from in the ledger.

Reviews the book "Constructive Accounting," by J.F. Sherwood.

Abstract The article presents the history of the joint stock company. Though it is not possible to discover instances of the joint stock company in England before the middle of the Sixteenth century, it must at the same time be recognized that before that date there were tendencies that would make its ultimate establishment inevitable. The trade of the Italian city states was already including western Europe in its scope and Italian finance consequently exerted an important influence in England. Naturally methods and organizations employed were copied to some extent abroad. There were two main lines of development which might result in the formation of a joint stock body. These were the medieval partnership and the growth of the idea of a corporation. The canonist doctrine on the use of capital discouraged loans while it encouraged the formation of partnerships. There were the "Commenda" and "Societas," both of which were in frequent use on the continent and were forms of the medieval partnership. In the commenda the commendator provided the capital and the commendatarius managed the investment, in the societas both contributed capital. In 1284, 1206 and 1312 certain Italian societas were granted rights to trade in England.

Reviews the book "National Association of Cost Accountants Year Book 1930."

Abstract The article discusses the importance of distribution and distribution costs as elements in business activities of today. It is well recognized that as production has become more efficient and economical, constituting less and less of a problem, distribution has become more complicated and costly, representing more and more of a difficulty. This fact does not in itself necessarily constitute criticism of existing distribution methods, but is simply an expression of conditions which have been brought about by economic, social and technical developments of recent years. It is, however, certainly desirable that the distribution of products of industry be accomplished economically and that every effort be made to bring about reductions in the cost of distribution comparable to those which in the last half century have been brought about in respect to costs of production. The cost accountant has rendered invaluable service to production engineers in their efforts toward cost economy. The present situation offers an outstanding opportunity to the cost accountant to furnish equally valuable aid to the marketing specialist in his task of obtaining mass distribution at costs comparable with those effected in the factory under mass production.

Abstract The question, whether appreciation is a profit, is not merely the concern of bookkeepers. It is a fundamental point of both business and general economic theory. According as this question is answered there will have to be differences in concepts which prevail in business it regarding profit, capitalized value, price policy, balance sheet theory, tax law and financing. The business man cannot neglect the significance of this question as he is accustomed to do in matters of pure theory on the ground that is far removed from his concern. What he reports as profit to his stockholders depends upon his interpretation of this question. Wage policies are also affected and, of course, the computation of income taxes. Varying concepts of profit will have an even more distinct relation to economic theory. it is clear that the concepts of rent, interest, market value, price, income and capital must vary according to whether one considers as income only the real product produced within a certain period, or whether income is regarded as the surplus increment of value between two points of time. This is, therefore, a basic question of economic science and deserves careful attention.

Abstract This article focuses on the editor's comment on the announcement of the Terminology Committee of the American Institute of Accountants. The editor suggests that devising of a definition is a fine art requiring at approach of a radically different character than that exhibited by the Committee's announcement. A woeful lack of correlation exists as between the definitions within group and between groups already published. The editor says that similar terms have been defined without proper reference to each other. Various current meanings of a single term are disclosed, together with an indiscriminate banding together of terms having or involving the same concept. Shades of meaning and fine distinctions, the nicety of which gives a real pleasure to definition-reading, are not revealed in a single instance. The editor further says that the results be more lasting if the Committee on Terminology could confine its efforts to a single concept at a time, and phrase definitions for the terms which the concept underlie. Definition making on the vast scale selected by or thrust on the Committee on Terminology is a prodigal and futile undertaking.

Reviews two books on standards of performance for department stores by Edgar H. Gault. "Monthly Standards of Performance for Department Stores: 1928-1929," "Yearly Standards of Performance for Department Stores: 1928-1929."