Amortization, Impairment, Inventory

Journal Article Money Wage Inflation in Industrial Countries: An Alternative Explanation Get access R. L. Thomas R. L. Thomas University of Salford Search for other works by this author on: Oxford Academic Google Scholar The Review of Economic Studies, Volume 43, Issue 3, October 1976, Pages 551–552, https://doi.org/10.2307/2297235 Published: 01 October 1976 Article history Received: 01 August 1975 Accepted: 01 December 1975 Published: 01 October 1976

Abstract ABSTRACT: Microcomputer spreadsheet programs can ease both preparation and grading of accounting examination questions whose solutions involve lengthy, sequential calculations.

Abstract Enough of this "glory," as Humpty Dumpty might call it. Eckel has served for years on the Canadian analogue to the APB. This makes it all the more gratifying that, despite our differences, we agree the main points: Financial accounting's allocation theory is a wretched mess, and things won't improve until we accountants radically revise our notion of income. A reading of [Kuhn, 1970, pp. 12-22, 47-48, 84, 162-65, 178-79] suggests that such a mess is just what one should expect of a pre-paradigmic19 discipline like financial accounting. If enough accountants of Eckel's professional eminence come to share his recognition of our intellectual crisis, our discipline may someday begin to prosper in the way the physical sciences have. Let's hope that these accountants do, for, as [Thomas, 1974, pp. 156-57] pointed out, this mess is also an ethical one. Meanwhile, to paraphrase the movie ad of a few years back, we can only continue to pray for Pacioli's Baby.

Abstract Reviews the book "More Debits Than Credits: The Burnt Investor's Guide to Financial Statements," by Abraham J. Briloff.

Abstract The article focuses on arbitrary allocations in accounting. Allocation may be unsuitable for general purposes yet highly useful for some specific purpose. Although this does not alter the financial accounting conclusions of Studies in Accounting Research (SAR #3), it is evident that the existence of useful arbitrary allocations has implications for managerial accounting. The concept of the range of ambiguity of an allocation was applied briefly in SAR #3 to situations in which various allocation methods are available and no conclusive reasons for choosing any individual possibility can be demonstrated. An accounting allocation divides a monetary magnitude among recipients to the firm, accounting periods, and so forth. The range of ambiguity of an allocation with respect to an individual input is the extent to which the amounts attributed to that recipient may vary by virtue of choice of allocation methods. SAR #3 discusses allocations such as depreciation in which the costs of nonmonetary inputs are written off. It points out that financial accounting theory requires that two kinds of allocations be performed in the amortization of nonmonetary inputs.

Abstract At some point in their education, business students deal with a "Time Value of Money" and with interest rates. The effective interest rate on any form of debt is that discount rate at which the present value of the payments made by the borrower equals the amount actually borrowed. So, it is helpful to have a way of estimating the effective rate without using present value tables. The efforts of lenders to justify their finance charges have led to great variety and inconsistency in the language used for discussing installment contracts. The contract's "principal" is the difference between the cash price and any down payment. The contract's "finance charge" is the difference between the cash price and the total amount paid by the credit purchaser. Often, the economic and legal definitions of "interest" are much narrower than what is included in this notion of the "finance charge." Lenders often regard this finance charge as including costs of credit investigation, insurance, account service fees and the like-in addition to the "pure" interest charge.

Reviews the book "Profits in the Modern Economy," edited by Harold W. Stevenson and J. Russell Nelson.

Abstract In the article, the author attempts various aspects about valuation of assets in terms of the net discounted cash flows that they are expected to generate over their productive lives. While there may be much to be said for modifying some features of conventional accounting, this article attempted to show that the discounted services approach was a snare in the way toward improvement as it suffered from crippling internal weaknesses. The author has also argued that whenever a stream of cash flows is jointly generated by more than one asset, the discounted services method cannot be used to value those assets individually without becoming very arbitrary. From a study, it seems that most actual relationships between assets and net receipts would be nonhomogeneous and that few companies would be able to escape the severe flaws of the discounted services approach. Outside of financial accounting, the discounted services approach is largely unaffected by these arguments. The approach breaks down only when it is used to value individual assets for balance sheet purposes.

Abstract In general, we must conclude that Dr. Marple simply has not demonstrated his case. His arguments either do not apply very well to any type of current value approach, or apply to only a few of them, or apply with equal force to the historical-cost accounting that he wishes to defend. There may well be grave objections to the use of current values in financial reports, but if so, they are unlikely to be uncovered without going to the considerable trouble of determining the fundamental assumptions, postulates, purposes, standards, and ways of looking at things that underlie historical-cost accounting, on the one hand, and the various current value approaches, on the other. It is this very difficult task which accountants must eventually perform. To perform it, to move beyond superficial discussion of the complex issues involved, accountants are going to need all the help that logical analysis can provide. To belittle this tool, as Dr. Marple does, is to hinder and belittle the eventual development of a reasoned accounting theory and a fully responsible accounting practice.