Accounting Theory With Special Reference, to the Corporate Enterprise (Classic Reprint)

As commonly presented in current textbooks and other writings, the theory of accounting is saturated with the proprietorship concept. In fact, since the adoption of this expression byS prague in his admirable Philosophy of Accounts most American writers have couched their explanations of the system of double entry largely in proprietary terms. In the usual treatment of the subject the structure of the accounts is described from the point of view of the proprietor; as far as possible transactions are explained and rules governing entries are formulated with reference to the effect upon proprietorship; and the other important classes of accounting data assets, liabilities, expenses and revenues are defined as mere accessories of proprietorship. I ndeed, the prevailing accounting theory might well be described as proprietary accounting. It is the opinion of the writer that these doctrines of proprietorship, as propounded byS prague, Hatfield, and others, are not an entirely adequate statement of the theory of accounts under the conditions of modem business organization. The technique of accounting has developed rapidly to meet the conditions of the large-scale enterprise, but theory as is so often the case has lagged far behind practice. In the case of the single-proprietorship, so-called, or the simple partnership, the proprietary is a fairly satisfactory pivotal category around which to construct the necessary accounting framework, but as an explanation of the accounting system of the corporation, the present dominant form of business organization, such an arrangement of accounting principles is seriously defective.
(Typographical errors above are due to OCR software and don't occur in the book.)

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