This article focuses on the faculty residency program in the in the U.S. as of January 1954. For several years in the U.S. programs of student internships have been available at certain institutions and through certain firms for the benefit of both students and employers. While the details of programs have varied, the essential features are somewhat similar. Because of the success of the student internship program it was doubtless inevitable that a similar program for accounting faculty members should be proposed. The purpose of the program would be to provide those without practical experience an opportunity to become familiar with the details of actual accounting practice, and to offer an opportunity to those with accounting experience either to broaden theft experience or to refresh it. The reaction to the proposed faculty residency program has been sufficiently favorable to encourage the American Accounting Association to participate in the actual arrangements for contacts between interested faculty members and participating firms and companies.

This article presents information the teaching methods of accounting. Beyond the first few weeks of the elementary course, too little emphasis is placed on the fundamental accounting equation. As a result the student threads his way through the first year of accounting at best understanding certain relationships in vacuo but probably in most cases accepting them on faith. He then proceeds to memorize these relationships and hopes that the examination situation will be sufficiently similar to the one he learned by rote so that he can cope with it. Perhaps the ideal solution to this difficulty is one which places greater stress on the equation in the first course in accounting, but this probably would require a fundamental revision of course structure with the concomitant sacrifice of other worth-while materials. One result that follows from this lack of stress on the equation is the necessity to spend the first part of the second course in accounting on a general review of the basic accounting process.

The article presents devices and techniques developed by the member of accounting profession for the presentation of the knotty aspects of accounting. The first method presented focuses on the accounting problems related to business income and the cash basis. Money profits are basic to the management of a business. The cash basis, where properly applied, involves considerably more than receipts and disbursements. Accounting on the cash basis means that net income is determined by including income and gains actually or constructively received and deducting those expenses actually or constructively paid, losses sustained, and allowable depreciation or amortization for the period. Cash includes not only money but also commercial paper redeemable in money on demand such as money orders, bank drafts or checks. It does not include notes or similar promises to pay money at some future time. The general rule is that a bank check received constitutes an actual or conditional receipt, even though the holder refrains from depositing or cashing the check until a later date. Transactions near the end of the year call for decision as to the exact time receipt occurs.