The problem, 507. — I. The scope of engineering analysis, 508. — II. Use of engineering data in economic analysis, 510. — III. Production-function analysis of pipeline transportation, 514; the technological relations, 514; cost functions, 517; conditions of equilibrium, 519. — IV. The use of engineering production functions: results of the present study, 526; further applications, 529; conclusions, 531.

IN THE three and a half years since Hiroshima, considerable loose talk about atomic power has circulated among both scientists and laymen. At first people envisioned virtually costless power. Upon more sober reflection they realized that even if the cost per kilowatthour of the atomic fuel were to approach zero other important items in the cost of generating power would be far from zero.' But though this realization has become general, what discussion there has been of the cost of atomic power has proceeded on an elementary and unrefined basis. As yet the estimates which have been made of the costs of generating electricity in atomic stations are highly tentative. All existing nuclear piles have been constructed for non-power purposes, and there is great uncertainty about both capital and operating costs of the pile, chemical and metallurgical plants, and heat exchanger of the future atomic plant. Little if any significance, therefore, should be attached to the numerical estimates of costs of atomic power used in this paper. Our purpose is to discuss the implications of what can now be perceived about the probable characteristics of the costs of atomic power plants and to bring out certain economic relations which will be of importance when, through accumulated experience, nuclear engineers are in a position to make fairly exact cost estimates.

In recent years increasing use has been made of systems of social accounts, and a variety of new types and new forms of presentation have been suggested. The general features of such systems are: (a) the division of an economy into a number of groups or economic entities, mostly themselves a complex of elementary units, and (b) a summing up in the form of accounts of the transactions of various kinds between these economic entities. As a rule, the economy of one country is investigated, implying that all other countries are regarded as one single group. The economy considered may be split up into a number of separate groups. It is customary to distinguish between consumers' households, business enterprises, and the government sector. If special attention is to be given to banking problems for example, banks will constitute a separate group.

Financial accounting can be regarded as essentially a process of keeping historical records of financial stewardship. Since working capital is such an important matter, the records should be maintained and various statements prepared in a manner that will not obscure the movement of working capital funds. The calculation of periodic income is a secondary function. This viewpoint leads to what may be termed a source and application of funds concept or philosophy of financial accounting. It involves nothing essentially new except a shift of emphasis. Most of the current principles and practices can be regarded in this light. An unqualified adoption of this viewpoint suggests some modifications of current practice. Both the income statement and the balance sheet may be restated to emphasize the fund change, or fund flow, aspect of business undertakings. The source and application of funds statement itself gains in significance. The double entry bookkeeping process may be invested with a source-application meaning. Debits (apart from those made in the income summarizing process) can be interpreted as expressions of applications of funds, and credits (with the same qualification), as sources. It this is done, certain matters that are sometimes formally recorded would not be recognized in the accounts proper. The source-application of funds viewpoint narrows the gull between accounting for business organizations and for non-business undertakings, as well as for fiduciaries. Without adopting or accepting all of the possible variations of existing practice that have been suggested, the source and application of funds philosophy may be used as merely one measure or standard by which accounting principles and practices, existing and proposed, may be evaluated.

The article presents information about last-in-first-out (LIFO) as a method of determining depreciation. The present problem of depreciation that is facing the accounting profession provides a vivid illustration of difficulties that arise only because of the variance between economic and accounting concepts. The problem is a result of the rapidly changing price level, but the inability of the accounting profession to supply an adequate procedure to cope with the situation stems, in the main, from its insistence upon using the historical cost concept in spite of the fact that cost determined by this method bears little or no relation to economic cost. An instance of the inadequacy of the present concept of accounting in this matter can be found in the recent action of the United States Steel Corp. in shifting to the LIFO method for handling long term inventories. In discussing short-term inventories, the United States Steel Corp. made the following statement in its 46th Annual Report, "an accepted procedure for determining the cost of short-term inventories is the LIFO." Commenting further on this procedure, the report states that this method is a generally accepted accounting practice.

This article discusses the financial administration of the United Nations. By the terms of Article 17 of the Charter the General Assembly considers and approves the budget of the United Nations and apportions the expenses among the member nations. In these respects it resembles the usual governmental legislative body which is the fund-raising and fund-granting authority for the governmental area which it serves. Also, like the usual legislative body, it has set up committees corresponding to an appropriation committee and a ways and means committee, or a committee on taxation. The Administrative and Budgetary Committee, ordinarily called the Fifth Committee, is one of the main committees of the General Assembly. It corresponds to the usual appropriation committee so far as most of this work is concerned. However, it also considers the assessment of contributions. Every resolution involving expenditure of money proposed for enactment by the General Assembly must be reviewed by the Fifth Committee which explains the effect the proposal will have upon the budget.