Knowledge that Transforms

The article focuses on traditional and modern accounting system. In accounting, a logical tradition may be the cost basis for recording the results of business transactions. On the other hand, some traditions may be weak logically, as, for example, the lower of cost or market inventory method. Thus, the point of disfunction between ideas, actions, or practices which are traditions and those which are not rests solely on the fact of past usage. The status of general acceptability may be attained by two main approaches, pronouncements of the American Institute of Accountants and the American Accounting Association, and a history of long usage in the past. Criticism of accounting has been prominent in recent years because of the existence of two conflicting. tendencies, the definite tendency of business and the economy and the tendency of accountants to cling to past concepts and practices. For accounting to continue to grow in usefulness, accountants must be able to adapt their practices to meet changing conditions. Accounting must also have a certain degree of stability so that uncertainty and disorganization are kept at a minimum.

To summarize briefly, it appears that the accounting teacher is usually pretty well occupied with teaching, counseling students, helping with administrative and committee work, directing graduate students in their projects, conducting research, writing, participating in the activities of his professional organizations, and taking part in his church and community affairs. The busy teacher may still feel a need for obtaining or continuing practical experience to keep him on his toes and abreast of current developments in accounting. He may be led into outside practice primarily for financial reasons. There are a variety of ways in which the teacher may practice. Those which permit him the fullest exercise of his learning and ability with the least routine or recurring procedures appear most likely to increase his effectiveness as a teacher, provided always that they are not too time-consuming in the aggregate. Those which involve repetitive book work seem more likely to dull his intellect. Accepting too much personal responsibility to clients may lead him to spend too much time and energy handling their work instead of performing his academic duties. This is particularly detrimental to his effectiveness as a teacher and should be avoided. Teachers and administrators should work together to develop a reasonable policy for their school concerning outside work. In conclusion, the answer to our question, "Should the accounting teacher practice accounting?" may be either "yes" or "no" depending on the circumstances. Practice should neither be required nor prohibited as a condition of employment. Arbitrary limitations should not be set on the type or amount of outside work an accounting teacher is permitted to do. Each assignment and the work of each teacher should be considered on its merits.

Reviews the book "A Study of Saving in the United States," vol. 1, "Introduction, Tables of Annual Estimates of Saving, 1897 to 1949," and vol. 2, "Native and Derivation of Annual Estimates of Saving 1897 to 1949," by Raymond W. Goldsmith.

This article focuses on attraction and selection of accounting teachers. The need of selection of accounting teachers is for a greater number of fine scholars to the collegiate schools of business or to business courses offered in liberal arts colleges. Secondly, having attracted fine scholars to the study of commerce, industry, and finance, it is equally important that they should not be alienated from accounting because of an early and intensive exposure to record keeping. The third important thing is to hold before the promising student the incentives, the variety of opportunities, the fascinating life which a career in accounting offers. Some of the criteria's for selection of accounting teachers are, good physical appearance, neatness in dress, professional bearing and attitude, and a good voice and speaking ability, sound underlying education having sufficient breadth and depth to provide a cultural background, technical proficiency through study, research, and practice and cheerful and enthusiastic disposition with an interest in people.

This article presents information on the relation between the scores of elementary and advanced accounting tests in the U.S. In the American Institute of Accountants', a College Accounting testing program, the academic progress of accounting students is evaluated with the Level I Achievement Test at the end of the first year of study, and with the Level II Achievement Test at later stages of training. Results of these tests are compared, to show the extent to which accounting majors, both as individuals and as college groups, tend to rank similarly at the elementary and advanced levels. The findings indicate that the Level I test is useful as a predictor of success in advanced accounting study, as measured by the Level II test, but they also show that there are some substantial differences in the relative rankings on the two levels of the test. A study of the correlations between scores on the Level I and Level II Achievement Tests of 2,192 accounting students in 203 colleges and universities were tested. Forty-two per cent of the students in the third quarter on the Level I test and 22 per cent of those in the second quarter ranked above the median on the Level II test. It appears that a student who ranks between the 50th and the 75th percentiles on the Achievement Test as a first-year student has about twice as good a chance of rating above average on the Level II test.

Reviews the book "Corporate Financial Policy," 3rd ed., by Harry G. Guthman and Herbert E. Dougall.

This article discusses the role of competent public accountant (CPA) in the business organizations. Technical knowledge is not the only mark of a CPA. Successful pursuit of a career as a CPA requires more than a complete education and experience in applying academic principles, more than accuracy and speed in performing an audit. The CPA who practices on their own account or who acts as in-charge accountant on engagements outside the office cannot long survive without some medium of skill in conducting his relations with the people surrounding them. The degree of this skill frequently determines their course of career. To the average client, the field auditors represent the public accounting firm. The senior accountant must bear the responsibility of representing the firm in worthy fashion. Clients retain public accounting firms partly because of a favorable impression of its staff members. Partners of public accounting firms who perform the personnel function have become increasingly aware of the desirability of the exercise of human relations skill by senior accountants. As modern living becomes more and more complex, social, psychological, and business problems increase proportionately.

Reviews the book "Marginal Cost Price-Output Control," by Burnham Putnam Beckwith.

The article presents a practitioners plea for more training in written English in United States. According to the author, in last few years he has seen a good many expressions in print, not only from the public accounting profession but from other professions, businesses, and from academicians, complaining of the almost universal inability of the college graduate of today to express himself either in writing or orally. The author says that the present time not enough is being done in the university world to bring home to the students how important good writing is, and to teach them how to become adept in it. He is convinced that the jobs not something which can be or should be handled by the faculty members in the schools of business administration who are concerned with the teaching of business subjects, but rather should be turned over to specialists in English teaching. Provision should be made in every required course leading up to a Bachelors of Business Administration degree for at least a full two semester course in English composition and style, consisting of intensive writing and criticism, writing and criticism, and more writing and criticism.

This problem relates to U.S. income taxes and should be answered in accordance with the Internal Revenue Code of 1954. Unless slated to the contrary in the following questions, individual taxpayers are assumed to be resident United States citizens on the cash basis, corporate taxpayers are assumed to be domestic corporations on the accrual basis, and all taxable years are calendar years. The Smith Medical Foundation was established in 1946 to finance research in the field of medical science. It leased building facilities from others from the date of its foundation to December 1953, at which time land and buildings adaptable to its operation were purchased. Since it was desired to operate its plant property as a self-supporting entity the Board decided to account for its plant as a separate fund, by establishment of a General Fund and a Plant Fund.