Knowledge that Transforms

Reviews the book "Accounting in the Administration of Large Business Enterprises," by Charles A. Heiss.

Reviews the book "Fiscal Planning for Total War," by William Leonard Crum, John F. Fennelly and Lawrence Howard Seltzer.

In this article the author, as a CPA examiner presents information about accountants. In Great Britain and her dependencies, the Institutes of Chartered Accountants, and similar societies, are organized to promote and control the profession, and with them, naturally, the profession holds the first place of interest. But the chartered accountant holds no certificate from the state. There are any number of accounting organizations which claim to possess as high standards as those of the Institutes, and they may assert this fact to the public in a manner which would be illegal in many of the states of this country if applied to the CPA. The most important thing that a member of California state board has to have in mind is the public. Second in importance as a matter of state board concern is the person who happens to be an applicant for a CPA certificate. He has certain rights which cannot be infringed upon with impunity, and these rights may be summarized generally in the expression a fair deal.

Reviews the book "Mathematics of Business and Finance," by W. Ben Dyess and Robert O. Gilmore.

Reviews the book "The Port of New York Authority," by Erwin Wilkie Bard.

Reviews the book "War Without Inflation," by George Katona.

Reviews the book "The Impact of Federal Taxes," by Roswell Magill.

In the July 1944 issue of the journal The Accounting Review, there appeared an article concerning the correct spelling of the name of Italian mathematician Luca Paciolo. Author Alfred V. Boursy, defends the position that the correct form is "Paciolo" and not "Pacioli." He bases his argument on linguistic and philological reasons, and the text of a tablet erected by the people of Paciolo's birthplace, Sansepoicro, a small town near Arezzo in Italy. The author's philological and linguistic reasons are sound. It appears that the author's statements are open to question. Boursy takes the text of the tablet from an Italian work by writer Plinio Bariola. This book is poorly done and contains numerous factual mistakes and errors in interpretation. It should never be cited as an authority. Bariola misquotes the text of the Sansepoicro tablet. A correct version is found in writer Balduin Penndorf's German translation of the treatise on bookkeeping by Luca Paciolo. From the analysis of the evidence it clearly appears that the tablet is dedicated to Luca Pacioli, and not to Luca Paciolo as stated by Bariola and repeated, on his authority, by Boursy in the July issue of the Accounting Review.

The article presents information on the use and development of statistical method. All things vary. There is no exact science. The best that one can do is lay down rules of action that may be used for doing things in spite of variations. The more "exact" science becomes, the more evident it is that the ultimate development of science leads to the statistical method. The statistical method provides a way of setting probability tolerances on chance variations and of pointing to the existence of variations that arise from assignable causes. The statistician possesses the tools for doing these things and for collecting data to make his tools effective in formulating rational courses of action. There are two kinds of variations and it is the task of the statistician to distinguish between them. Some variation arise from causes than can not be traced, or should not be, because one almost always only wastes time and money in trying to trace them. These are chance causes. The other kind of variation arises from all assignable cause, a cause that one is justified in looking for. The statistician must distinguish between these two different kinds of variations.

The article presents information on merchandise turnover and the method of computing it. Data and statements are of limited usefulness unless they are properly interpreted. To assist and facilitate interpretation, particularly of the balance sheet and income statement, various ratio and percentage analyses frequently are made a part of, or appended to, these reports. One of the most significant of these ratios to merchandising businesses is the one that shows the average number of times the inventory was replaced during a given period. It is usually called merchandise turnover or stock-turn. The customary method of computing inventory turnover is to divide the total cost of goods sold by the average value of goods on hand during the period. It is recognized that the turnover figure obtained by the use of the suggested procedure is subject to the same weakness as that secured by the conventional method, in that it will be distorted somewhat if the period under review has been one that included sizable price changes.