I. Introductory: The problem of depreciation, 185. — II. The case against accrued depreciation, 189. — III. Current criticisms of Allison's argument, 191. — IV. Depreciation where the rates are based on the strict investment principle, 195. — V. Depreciation where the rates are based on cost of reproduction as a measure of “present value,” 198. — VII. Depreciation where the rates are based on actual cost of the present property. The “historical-cost” basis, 207. — Conclusions, 211.
Abstract Public utilities have given rise to many knotty problems, and much comment has been heard, pro and con, as to the reasonableness of their income and expenses. A public utility is commonly thought of as a natural monopoly, but a regulated one, which does not settle its own rates. It is under the jurisdiction of the various regulatory commissions which are found in all states with the exception of Delaware and Kentucky. These commissions are supposed to set the utility rates at that point which will yield a reasonable rate of return on "fair value," plus enough to cover operating expense., but the more or less familiar discussions and decisions as to what "fair value" and a reasonable rate of return are, and the methods of determining them, will be passed by here. Instead, it is proposed that the gross, net operating, and net income of the utilities be examined in their relation to some of the other values and costs, and that some of the major operating expenses be subjected to a survey as to what they include, their reasonableness, and their relation to total operating expenses.
Abstract The purpose of this paper is to show the growth of instruction in accounting in the U.S. universities and colleges from 1900 to the present, as of June 1927. The interest in accounting has also grown rapidly in secondary schools, normal schools, and foreign schools in this same period, but the scope of this study is restricted to the U.S. universities and colleges. The year 1900 was selected as a starting point because instruction in accounting prior to that time was not very important. In fact, even during the first few years following 1900 there was not much development in accounting instruction in the universities; and in such work as was given the art and science of bookkeeping were emphasized rather than the fundamental principles of accounting. In order to determine the extent of this growth a study was made of the courses in accounting as shown by the catalogues of forty two of the leading universities and colleges. In this study the catalogues were carefully examined for each year from 1900 to 1926, inclusive. In addition, in order to determine definitely the growth in the number of schools giving courses in accounting, the catalogues of seventy-five additional universities and colleges were studied for the year 1900, 101 for 1910, 303 for 1916, and 575 for 1926.
Abstract In spite of the multiplication of schools of accountancy during the last twenty-five years, a relatively small percentage of the men who enter the profession have graduated from the recognized schools. This is no doubt due in large part to a lack of cooperation between the school and the profession for a purpose which would be mutually advantageous. Some progress is this respect has been made in the last few years by the establishment of a Bureau of Placements by the American Institute of Accountants, but the conditions of employment laid down there in leave much to be desired, and seem designed rather to give the student control of his position instead of permitting the employer to control the student. To illustrate how important is the correlation of theory with practice, it is only necessary to point out that in any given piece of work it would be practically an endless task to carry out in full every operation and every test which the theory would make possible. An audit carried out along these lines would be prohibitive in cost, and its result would be no more certain.
Abstract Standard costs are the natural outgrowth and development of budgetary accounting, which, curiously enough, warn first used by industry in connection with factory burden. Gathering refinements along its path, the system has reached its present stage of development in connection with manufacturing after a complete circuit of functional application. That the subject is an important one is evidenced by the fact that considerable time has been devoted to it at each of the last five annual meetings of the National Association of Cost Accountants. That it presents many controversial features is likewise apparent from even a brief study of the limited available literature, and the ultimate solutions of these problems -as the thought and effort in the field progress-will doubtless differ considerably from many of the current practices. In the next decade, unquestionably, a great impetus will be given this subject by practicing cost accountants; and university instructors in this field must be prepared not only to discuss standard costs intelligently, not only to enlighten students as to the present development of the subject, but to lead the way to scientific and practical perfection of this method of cost accounting.
Abstract According to the article author, the term "bookkeeping approach," is a misnomer. Much more is involved than the term implies. It should be called the accounting foundation, without which no real worthwhile accounting superstructure can ever be built. The subject of bookkeeping approach really resolves itself into a question of bookkeeping method. Book-keeping method and pedagogy constitute the "open forum" in commercial work today. There is an increasing feeling among book- keeping teachers that "all is not well in educational Egypt." Many of the most progressive teachers are realizing that we have never got to first base in the development of a mound bookkeeping pedagogy. Bookkeeping is to-day an acknowledged factor in secondary education. It has acquired its present permanent footing in the face of determined criticism and opposition on the part of many educators. And very few subjects have in so short a time obtained such a firm and universal footing in high school curricula. In the beginning, the high school Inherited the textbooks, the teachers, and the methods of the business college. Measured by present educational standards, all of these were extremely inadequate. Thanks to a number of conditions, the teaching element has greatly improved.
Abstract Accounting and statistics, are similar in their uses, for both are used as tools of control. They are also similar in their method, bearing, so to speak, a family resemblance, for accounting and statistics may be regarded as offspring of the single parent, quantitative method of analysis. The quantitative method of analysis has been very successful in the natural sciences, because most natural phenomena can be easily segregated and measured. This method has been the basis of many of the important scientific discoveries of recent years. In fact, it has been asserted that progress in the natural sciences has always waited upon the development of adequate quantitative technique. In the social sciences also it has been maintained that adequate control can only be obtained from better quantitative treatment of the phenomena. It is, of course, often difficult to measure economic phenomena accurately, nevertheless the measurement is necessary. The business enterprise organized for private profit has accordingly developed a technique of measuring and recording it. Facts, and business policies are now formed primarily on the basis of the quantitative data available in accounting and statistical report.
Abstract The article focuses on antecedents of double-entry in bookkeeping. It is proposed in this paper to follow the genealogy of bookkeeping back beyond those parental ancestors whose respectability was so ably proved at the time. The purpose here will be to trace out those blood-lines of preparental inheritance which finally converged at a certain time and place, there to confer certain characteristics upon the offspring. In trying to perceive the forces which produced double-entry, two questions, must be answered in the process. First, what were the antecedent elements out of which double-entry finally evolved. An answer is needed to this question, so that one may better appreciate how closely accounting has been, and still is, related to several collateral fields. Second, what surrounding conditions were necessary to give vitality to these antecedent elements? The antecedents of double-entry, those factors which in time became so interwoven as to render double-entry inevitable, are all familiar quantities; some of them are very old and some are very obvious, but all of them are, in the writer's opinion, indispensable. The art of writing is an indispensable antecedent, since bookkeeping is before all else a record; arithmetic is essential also, since bookkeeping is a sequence of simple computations, even though they are cast into certain forms; private property, since bookkeeping is concerned only with recording the facts about property and property rights.