Abstract The trading has hit the retail trades in the U.S. with an impact almost unparalleled in business history. Nearly one out of every two families in the country is collecting these stamps, offered by retailers in return for purchases at their stores, to turn them in for merchandise, premiums, or even cash. In 1956, trading stamps were distributed by over 140,000 retailers throughout the country in conjunction with sales of over thirty billion dollars worth of goods and services. It is therefore surprising to note that, even though these stamps were first issued in 1891, and despite the recent phenomenal growth in their use, they are almost completely ignored in accounting literature. To discover any written clues to the theory and methods of accounting for the stamps, one must turn to the legal decisions which discuss these problems. While the trading stamp comes into legal prominence chiefly through attempts to prohibit, burden with oppressive regulations, or license its use, some of the strongest arguments advanced by those defending the stamp practice are grounded in accounting theory.