Book reviews;

              Bulletin HASKINS & SELLS 47
Book Reviews
Gerstenberg, Charles W. Financial Or­ganization
and Management of Business.
(New York, Prentice-Hall, Inc., 1924. 723
p. Price $5.)
This book is of value to accountants in
that it discusses some of the important bases
on which their work rests. "How," one
asks, "can an accountant interpret the ac­counts
and pass judgment on the affairs
of a particular business enterprise if he is
not thoroughly familar with the funda­mental
principles underlying capitaliza­tion,
business operation and results, and
rational business policies?"
To epitomize the scope of this volume
one might say that it embraces the acquisi­tion
and use of business capital and rela­tion
of profits thereto. The style is de­lightful.
The text is livened with human
interest illustrations. The arrangement is
logical. There is an abundance of ex­planatory
notes which are very satisfactory
in their detail and precision, a need which
only an experienced teacher understands.
The book is replete with source-notes and
references. If it may be criticised for
being bulky and unhandy to carry about,
such objection should be mollified by the
thought that it offers a lot for the money.
The content is rather characteristic of
books of its class, and no claim may be
made for any particular originality in this
respect. There is, however, one section
which deserves more than passing mention
and accountants especially are under obli­gation
to the author for his full and satis­factory
exposition of working capital.
This subject has been most superficially
treated by authors in the past, probably
because of its complexity and the enormous
amount of time required to think it through
to a practical conclusion. One of the
difficulties involved in discussing the sub­ject
of working capital has been definition.
The time-honored acceptance of net cur­rent
assets as representing working capital
constitutes a fallacy which is inconceivable.
When one goes to the heart of the question
it must be apparent that all current capital,
regardless of its source, is being turned
over in an attempt to develop profit. Pre­sumably
no one will insist that only the
proprietary equity in current assets is being
so utilized. There is, however, a contro­versy
with respect to working capital, but
it is founded on lack of agreement as to
what the term "working capital" means.
The author, after acknowledging the con­troversy
and discussing both sides briefly,
gives material help to groping minds by
dodging the issue and applying the term
"circulating capital" to all the assets of a
company that change form in the turnover
process incident to the production of
profits. If it were conceded that the book
has no other value for accountants the
three chapters on working capital would
be well worth the price.
One may not dismiss the review of this
volume without paying compliment to the
author for the energy, capacity and thor­oughness
with which he has discussed the
subject and an acknowledgment of his con­tribution
to the advancement of education
for business through his courses at New
York University and his books on finance
and related subjects.
McClure, Matthew Thomas. How To
Think in Business. (New York, McGraw-
Hill Book Company, Inc., 1923. 173 p.
Price $2.)
Possibly the best way to convey an idea
of the character of this book is to quote
some of the passages. It has some high-sounding
words and abstruse phrases, but
withal it is an extremely sensible treatment
of a subject which merits more attention