Journal Article Academic Economics in Present Russia Gelesnoff, Grundzüge Get access M. M. Bober M. M. Bober Lawrence College Search for other works by this author on: Oxford Academic Google Scholar The Quarterly Journal of Economics, Volume 43, Issue 2, February 1929, Pages 352–363, https://doi.org/10.2307/1882478 Published: 01 February 1929

Reviews the book "Effeklem als Kapitalbeschaffungs mitel der Unternehmung," by Karl Theisinger.

Reviews the book "Betriebsanalyse," by Kurt Schmaltz.

IN order to forecast next year's income tax receipts it is necessary to determine the income of the current year upon which the tax is based. Since the latest data tabulated from income tax returns and published in Statistics of Income apply to income reported two years ago, the gap between recorded data and the present must be bridged by an estimate of last year's income. Analysis of the data published in Statistics of Income has resulted in a tentative method of forecasting the income that will be returned and published in the next two volumes of the Statistics of Income.' The various stages in the development of this method as applied to forecasting corporation income, both before and after the data in Table i (this REVIEW, vol. XI, pp. i8o-i) were derived, may profitably be described. At the outset, attempts were made to use independently such items as gross sales, miscellaneous income, cost of goods sold, and miscellaneous expenses. The ensuing analysis revealed many variations which could not be explained by economic changes, and which were traced and found to be due to changes in laws, methods of tabulation, and accounting practice. Therefore, items of expense or deductions, that might have been interchanged on account of any one or all of these causes and consequently show an inverse relationship, were combined into one group, and items displaying a similarity of movement were combined into another. The dominant characteristics of these resulting groups were those of fixed and variable (supplementary and prime) costs, and it appeared desirable to pursue the study according to such a classification although considerable overlapping existed due to the nature and number of separate items tabulated. A corresponding separation of income into fixed income and variable income cannot be satisfactorily obtained from the data. However, the separation of deductions into two such parts becomes a function of, or dependent on, the separation of income into corresponding parts, as well as on the weight or influence attributed to other unknown factors. Since complete separation of deductions into fixed and variable parts was not possible by direct use of the tabulated data, resort was had to trial and error experimentation to obtain an approximate division. It is fully appreciated that the results are tentative, that publishing detailed results without expressing all of the limitations and mental reservations which the authors have attached to the data and to the method is hazardous, and that as more data become available many of the present conclusions may be discarded. The method in its present stage of development consists of (i) forecasting gross income,2 (2) deducting therefrom an estimate of variable costs, (3) deducting similarly an estimate of fixed costs, and (4) obtaining a resultant estimate of net income. There follows a description of the analysis at two previous stages of development and an explanation of the more important intervening trials and errors. The first stage of development was reached before the data for I926 became available in I928. After discarding the separate items of income and deductions as rather meaningless, and recognizing the limitations of gross income data as published, but without attempting to make the necessary adjustments, an index of gross income was constructed and substituted in place of the tabulated gross income data. This index of gross income was constructed by combining several published index numbers and using constant *Continued from November, I929, issue. 1 Forecasts of prior year loss deductions from net income and of credit for size of net income also must be made in estimating net income subject to tax. Furthermore, the net income as tabulated in the Statistics of Income is not exactly the same as the income on which taxes are actually collected during a given period. For example, during the calendar year I927, some current taxes were collected on incomes tabulated in the I925, I926, and I927 Statistics of Income, owing to the method of tabulating fiscal year returns, and the legal provision for payment of taxes thereupon in quarterly installments, the first of which is due two and one-half months after the close of the fiscal year for which the return is made. 2 Gross income as adjusted and explained in the preceding article.

Abstract The remainder of this article is addressed to the task of considering a course of this kind which is adapted to the use of university schools of business administration, a course to meet the needs of both advanced undergraduate and graduate students. The method which is described here uses several different means of instruction. One way in which a text book has been used to good advantage by the writer in the instruction of his students has been to assign to them the entire book to be read rapidly during the first week, indicating to them the parts which can be skipped at this first reading as well as the parts which should be glanced at more thoroughly than the others. It is often satisfactory to assign readings therein and then give the students a chance to ask questions in class about any of the points which have bothered them. It will often be found that such questions show that the students have failed to read the text with sufficient care aid directions to look up the answers to their own questions.