Knowledge that Transforms

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

Reviews the book "Credit Bureau Management," by J. R. Truesdale.

Reviews the book "Die Marktverbande," by I. Teil and W. Vershofen.

Reviews the book "Putnam's Economic Atlas," edited by George Philip and T. Swinborne Sheldrake.

Reviews the book "American Investment Trusts," by John Francis Fowler.

Reviews the book "Corporation Finance," 6th ed., vol. 1, by Edward Sherwood Mead.

Reviews the book "Mechanics of Accounting," by Leo A. Schmidt.

Reviews the book "Problems in Industrial Accounting," by Thomas Henry Sanders.

Abstract Many credit men and bankers tend to place a high value upon the condition of the current ratio as found in balance sheets in extending credit to borrowing clients. In many instances the ratio of current assets to current liabilities is taken for granted without adequate reasons being given for the underlying causes that brought about the change from a former position. In a particular balance sheet, the ratio may show the same figure of, three to one at the close of each of two fiscal periods, or it may show a change to a decidedly higher ratio of four to one, or again to a lower ratio of two to one. The credit man should analyze his balance sheet far enough to ascertain whether or not the improvement in the working capital was caused by the investment of inside money or outside money. Bonds involved mortgage liability and increased overhead costs. Capital stock naturally has no foreclosure possibility, but demands its rent. The changes in the ratio, caused by increases or decreases in the working capital are fundamental. They are apt to be permanent, therefore, should be analyzed carefully, in order to ascertain if the financial structure has been altered seriously by the change, as for example the flotation of bonds to fund the current debts.

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.