Knowledge that Transforms

Reviews the book "The Financial Plan of Department Stores. Bulletin No. 82," by A.H. Winakor.

The accounting equation is based on the axiom that assets equal equities and that on the extensions of this axiom depends the recording of all business transactions. The accountant is obliged to determine whether the proprietors have obtained an increase from the possession or acquisition of assets during the accounting period. The accountant is thus dealing primarily with things, tangible or intangible, which have been acquired by the enterprise, and with the concomitant claim against the assets by a third party or by the proprietor. As a rule when a person is asked to take away from a given quantity he conceives of the operation as a negative one and the quantity to be affected as positive. This last precaution is suggested because many persons have agreed to the foregoing, but viewed erroneously a decrease of a proprietory interest as a negative operation. The principal thread of the discussion can be resumed by presenting the accounting equation in T-form. At this juncture one may, with reason, pause to indicate what may be termed the accounting "pons asinorum."

Reviews the book "Principles of Auditing," by Eric L. Kohler and Paul W. Pettengill.

Accountancy instruction has to a large extent followed the lines of accounting practice and accounting practice has in general adjusted itself to changes in business practice, although at times this adjustment was made with hesitation and reluctance on the part of some accountants. During the past fifteen years, however, accountants, both public and private, have shown a larger willingness to render a more varied and more valuable service to clients and employers along the lines of interpreting the accounts. Realizing that accounting services were being extended beyond the function of recording into the field of accounting analysis and interpretation, teachers of accountancy have quite generally bent their instruction in the direction of management. Textbooks now guide students into accountancy through the doorway of business problems, commonly referred to as the balance-sheet and profit and loss statement approach. Therefore, when new methods of control are employed by management, such as fixing standards of accomplishment or forecasting operations in order to direct and coordinate all phases of a business, it is quite proper for teachers of accountancy to take notice of such methods and train future accountants to some degree at least in those problems of management that can not be solved unless the accounting records are intelligently analyzed and interpreted.

Reviews the book "The Dual System of Stabilisation, ed. 2"by J. Taylor Peddie.

Reviews the book "Organized Commodity Markets," vol. 155, part 1, edited by S.E. Huebner.

Reviews the book "The Federal Fund Market," by Bernice C. Turner.

Reviews the book "High and Low Financiers," by Watson Washburn and Edmund S. DeLong.

Research as applied to business problems may take on one of two fundamentally different aspects. It may be conducted with the view of extending the limits of knowledge of business phenomena in general. In that case, the research leads to the establishment of new generalizations or to the measurement of phenomena for which previously only qualitative facts were known. This is the truly purely scientific aspect of business research. The other type of business research is that which concerns itself primarily with the providing of data or generalizations on which are to be based the solutions of specific business problems. Such research may be truly scientific in its method in the sense that it involves the statement of the problem, the collection of facts, their analysis and final presentation in conclusive form. Such research is usually narrower in its scope than is the first type; its conclusions may not be of a general nature nor may they be of general interest. In fact, the conclusions may have no social or economic significance whatever. Some of these studies are made with the specific objective of aiding management rather than that of increasing the store of human knowledge, they are likely to result incidentally in such increase. Facts are revealed and relationships are discovered that may be new to the accounting profession in general or which may point out the need for a revaluation of principles already held.

This article presents information on public rules for private accounting in France in 1673 and 1807. As per the rules of Ordinance of 1673 some designated classes of `business men were required to "keep books." Public regulation, "on paper" at least, extended to the making of rules as to the books to be kept, forms to be observed in the making of entries, authentication by a public official as a means to the prevention of the crudest kind of falsifications, the making of periodic inventories, and the preservation of correspondence. The rules for authentication of the books of exchange dealers and bankers pear a little more strict than those for the authentication of the books of tradesmen and merchants. However as per the accounting rules of commercial code 1807 every business man was required to have a journal which presents day by day his accounts receivable and payable, the operations of his business, acceptances and endorsements of commercial paper, and in general everything which he receives and pays, under whatever head it may be.