Abstract The article presents comparative rather than absolute limitations, a problem that faces accounting, and deals with purchasing power measurements in accounting. In recent times, two basic economic fears, namely, inflation and deflation have been developed which involve concern about the purchasing power of the dollar, and its lack of monetary stability or shifting of the price level. The general price index, or any one of its broad subdivisions, is admittedly no more than a very general indication of what "package" of goods and services a given quantity of money will buy under certain conditions of time and place. The price index blends indiscriminately the effect of monetary factors with such factors as output, technology, wage bargaining, etc. The problem of inflation may be delimited and treated as involving determination of the cost of goods delivered to customers, determination of the cost of utilization of long-term assets, and measurement for administrative and other purposes of return on capital investment.

Abstract The article presents an introduction to the art of accounting. The art of accounting has long been the subject matter of study by those who would become accounting technicians-controllers, auditors, public accountants, cost accountants and the like. For the purposes of this type of study, objectives have been formulated, teaching methods have been devised and a substantial body of text and other material has been developed. As a result the education of accounting technicians goes forward on a reasonably adequate basis although by no means without numerous possibilities of betterment. At the same time popular education in the art of accounting has been woefully neglected. For many of those who are not interested in becoming accounting technicians only inadequate inducement has been offered and only inadequate reasons have been given, for the study of accounting; for those who have evinced an interest in the art, despite their lack of desire to become technicians, the opportunities for study have, for the most part, been limited to the courses and procedures available for prospective technicians.

Abstract While it is entirely proper, for purposes of discussion, that the American Accounting Association's statement of accounting principles underlying corporate financial statements be divided into parts, no section or part of the statement can be intelligently discussed without considering the statement in its entirety. The original or tentative statement was predicated by its authors on the assumption that corporate financial statements should be continuously in accord with a single coordinated body of accounting theory. The same idea is indicated in the revision, where the achievement of the desired objectives in accounting is said to be dependent upon the existence of a unified and coordinated body of accounting theory. Every part of the statement must therefore be considered in the light of its relationship to the whole. Rules found to be unsatisfactory were changed as conditions indicated the necessity therefore, the charge has frequently been made that the system failed to keep abreast of social and economic developments.

Abstract In the article, the author discusses on the progress made in the balance sheet practices. There is still a good deal of confusion, however, due largely to the lack of uniformity and definition in balance sheet terminology and to the use of narrow or "specialized" methods of approach in our efforts to solve the problem. This is particularly true for the moment designate as the "net asset" section of the corporate balance sheet. The influence of the double entry method on the reasoning of accountants has long been a suspicious issue. The quality of accountant's logic has on occasion been impaired by their passion for balance. Therefore, the author starts with the corporate balance sheet in statement form, a showing based on the formula of assets minus liabilities as representing net assets. The "three layers" of balance sheet have been characterized as the gross economic capital, itemized and individual liabilities and their total, and the net economic capital of the enterprise. The author submits that the subdivision of net economic capital is to be made on the basis of origins, restrictions on withdrawal, and administrative control.

Abstract The article focuses on business-law training for students of accounting. Faced with the ever increasing complexities of modem civilization, society has relied very largely on the device of specialization for the solution of its problems. This specialization has given rise to a problem of its own, and without in any way detracting from the splendid achievements of specialists, venture to suggest that there is a serious need in the social organization of today for the coordination of the activities of the various specialists. The respective problems of the legal and accounting professions indicate the author's point, and because of the close relationship between the two professions in certain lines of endeavor, it is essential that the respective viewpoints of the two professions be coordinated. This necessity has been universally recognized in the inclusion of law study in the curricula in the schools of business administration, and recognize to a certain extent by a display of interest on the part of law schools in the teaching of accounting.

Abstract Economists, statisticians, accountants and others have long realized that the various income tax returns filed with the Bureau of Internal Revenue contain a vast quantity of valuable statistical data. The American Association of University Instructors in Accounting, the American Economic Association and the American Statistical Association, designated a Joint Committee to consider the entire problem and to draft suggestions to the Bureau of Internal Revenue for the amplification, revision or elimination of the existing tabulations. This report recommends that the specific recommendations of the Committee as set forth in the report be approved in principle; that a new Joint Committee be appointed to continue the work and that a modest appropriation be made for its traveling expenses. The purpose of this article is to summarize briefly the various problems involved and the Committee's attempts at solution. Certain phases of the problem at least are of considerable importance to accountants and teachers of accounting and it is suggested that a consideration of the statistics as now published would be of interest to all of the members of the Association.

Abstract The subject of industrial accounting may be treated from any one of three points of view. First, it may be regarded primarily as a method of making and presenting an organized record of business happenings. Secondly, it may be regarded primarily as a method of exercising control over business events; during the period from 1918 to 1925 emphasis was concentrated largely on the "budgetary" aspects of industrial accounting. Finally, it may be regarded primarily as a means of measuring the efficiency of business operations. The subject of this paper is the coordination of the "budgetary" and "standard cost" aspects of industrial accounting. The budgetary idea in industrial accounting was probably borrowed from the municipal field. Municipal expenditures are controlled under the basic rule that no moneys are to be spent except as a statutory authorization or appropriation is made in advance. These appropriations are made after a study of possible revenues; a summary of the estimates and appropriations is designated as the budget. Adopted at the beginning of the fiscal period, the budget is used to control expenditures throughout that period. At the conclusion of the period a report is made showing a comparison of the expected results with actual income and expenditures. As applied to the industrial enterprise the central objective of budgetary procedure is the exercise of control over manufacturing operations.

Reviews the book "The Standard Book on Cost Finding for Printers," edited by Elmer J. Koch.

Abstract Efforts are being made at Columbia University, New York to correlate the subjects on law, economics and business. Efforts are made to introduce the subject of accounting in the law school curriculum. A good deal of difficulty in arriving at any sort of agreement as to what phases of the subject should be taught, what methods should be used, and what the content of the various courses should be is constantly met with. At the present time the Law School is giving a course in accounting as part of its curriculum. In this course the instructor is avoiding the teaching of what may be called the "mechanics" of accounting. In other words, he makes no effort to teach such things as postings, trial balances, etc. The method tentatively adopted is the presentation of problems with accounting data whose solution involves an application of rules of law. The experiment is still too young to permit very definite conclusions as to its usefulness. It is believed however, that the idea is a sound one and that one may take a measure of satisfaction from the fact that the Law School has definitely recognized the necessity of an accounting course.

Abstract Six of the nation's outstanding accounting authorities have been invited to prepare papers expressing the views for and against the proposition that depreciation need not be restricted to the amortization of historical cost. While accountants have long realized that their basic standard of measurement, the dollar, is a varying one, they have, with one conspicuous exception, declined to recognize, as generally accepted accounting procedures, departures from cost because of changes in the purchasing power of money. In the list obstacles to good accounting is the misconception, often entertained, and blindly fostered by many accountants, that an income statement should reflect earning power or be confined to current operating performance. By moving depreciation expense up or down, according to predictions of the moment, a more accurate earning power or operating performance is said to be reflected in the net result. A good deal of mumbo-jumbo necessarily attaches to the process, for to them earning power or operating performance is a nebulous thing, visible only to initiates such as forceful corporate managements and accountants of discernment.