Knowledge that Transforms

With the increased attention which is being given by universities to the training of students for business there has come an increased interest among both college authorities and employers in the problem of adjusting the inexperienced graduates of the schools of commerce to the practical affairs of business. College teachers and administrators understand fully that their graduates are not qualified to assume at once the duties of responsible business executives. They know that every man must pass through an apprenticeship in order to acquire an intimate personal knowledge of general business practices, to develop sound judgment or business sense, to gain skill in dealing with men, and to learn, in addition, the technique of the particular industry or occupation with which he is to be connected. It is their belief, however, that the period of such an apprenticeship will be materially shortened by the training which the college graduate has received and that ultimately he will have a broader view of business because of the foundation which he has laid in college. Business men are coming to have a more considerate attitude toward the college man, not because of his immediate usefulness but because of his potential value. They are realizing, also, that any growing industrial or financial concern which requires a large

With scarcely a notice from the press and but little attention from public men, except those concerned in preparing the legis? lation, there was passed in Congress, in June, 1920, an act which is bound to have a great and growing influence in the general industrial development of the United States and in the extent to which the states and their various municipalities will accept the opportunities offered of controlling their own public services. This act creates what is known as the Federal Power Commission.

The Report' of the Federal Trade Commission on the "Profits of the Packers" should receive the most careful attention of economists and accountants who are interested in the problem of joint cost. In unmistakable language the commission condemns as unsound the methods of cost calculation employed in the packing industry, albeit the methods are fundamentally those which are followed by the United States Department of Agriculture and the various public-service commissions in dealing with similar cost problems. The economist will note that the commission offers no constructive or practical suggestions as to how the problem of cost-finding in the by-product industries should be solved; and the keen accountant who is not led astray by the sentiment that the word of a government body is the last word will realize that the "generally recognized principles of accounting," which the packers are openly accused of ignoring, are principles which have been evolved to meet the needs of business enterprises essentially different in character from the business of meat-packing concerns. Before reviewing in detail the criticisms offered by the Federal Trade Commission, it may be well to note those peculiarities of the packing industry which have given rise to the present system of cost accounting. In the first place, the meat-packer does not assemble raw materials into a finished unit as is the case in most manufacturing industries. He is engaged in dividing his raw material, consisting of a single commodity, into a great many finished products, differing widely from one another both in character and utility. Obviously, there is no way of ascertaining the money cost of each of the various products. Another peculiarity about the packing industry which affects the accounting system is its complexity. From the point of view of functions performed, the industry is a collection of four fairly distinct industries, each performing a different function. These