The article focuses on the role of liquidity in exchange valuation. The method of assigning values to goods at the event of exchange under the historical cost system has been described. The historical cost system as a given and attempt to generalize the exchange valuation rules of that system has been taken. An exchange is a two-way flow of goods. An acquisition is accompanied by a sacrifice. Thus, an exchange has a double effect, an increment in one good and a decrement in another, which requires a double entry on the books of account. The operations necessary to make the entry may be analysed in general terms. The entry is meant to reflect the underlying flow of goods. An exchange is an increment in one good accompanied by a decrement in another good. Neither of these goods necessarily has a value attached, instead value is assigned to them. In most cases this assignation of a value is done intuitively, that is without an explicit consideration of the process. The simplest cases are cash exchanges in which the value of cash is set equal to the quantity of cash.

Reviews the book "Accelerated Accounting: A Managerial Approach," by A. Tom Nelson.

The article focuses on the comparison of the responses in the barter case to those in the cash exchange and that no exchange cases revealed significantly more variation in the barter case. This could be interpreted as evidence that the conventional theory is incomplete. The discriminant analyses provided more direct evidence. First, in the book value versus market value analysis the author was unable to predict group membership from the situational variables. It appears that a minority, 23 percent of practitioners hold that the purchase rule, Book Value group should be applied to barters without regard to the situation. A majority 77 percent hold that either a sale or majority rule, Market Value group should be applied to barters. This division may be interpreted as the existence of two different conventional theories. Second, although one was able to identify a liquidity, acquisition and conservatism effect, the majority of the total variance remained unexplained. This may be interpreted as indicating that other implicit criteria exist which has not been identified.