Harvard. Exams for Elements of Accounting. W.M. Morse, 1908-1909

The department of economics did offer a couple of business related courses  to help prepare its undergraduate majors for careers in commerce, finance, and business generally. From the enrollment numbers we see that accounting was pretty popular. It had the third highest course enrollment (167), following Principles of Economics (503) and Economic and Financial History of the United States (198) in 1908-09.

With only a modest gumshoe effort I was able to track down the teaching assistants for the course. All three became lawyers, one even a judge.

Note: According to the printed course announcement for Elements of Accounting this should have been a half-course (one semester) but, as in previous years, this was in fact a full-course (two semesters).

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The Teaching Assistants

Robert Mann Johnson (cum laude, Economics, A.B. 1908, LL.B. 1911)

Jacob Joseph Kaplan (magna cum laude, A.B. 1907, LL.B.1910),

Harold Birdsall Platt (magna cum laude, Economics, A.B. 1908, LL.B. 1911)

Source: Harvard University, Quinquennial catalogue of the officers and graduates 1636-1930, pp. 458 and 460.

New York Times Obituary for Robert Mann Johnson

   Robert Mann Johnson of 58 Lynwood Road, Scarsdale, N.Y., a lawyer with the firm of Milbank, Tweed, Hope & Hadley, died of a heart attack yesterday as he enetered his firm’s office building at 15 Broad Street. His age was 60.

Born in North Weymouth, Mass., he was graduated from Boston Latin School in 1905, Harvard College in 1908 and Harvard Law School in 1911. Mr. Johnson practiced in Massachusetts before coming to New York and being admitted to the New York bar in 1921. He was with the firm of Masten & Nichols from 1928 until 1931 when he became associated with the Milbank company.

Surviving are two daughters, Marjorie Elizabeth and Hollis Ann.

Source: The New York Times, July 30, 1948, p. 18.

From the Jacob J. Kaplan Papers Collection

Judge Jacob J. Kaplan, born March 12 1889 was a prominent and well-respected Judge in Boston, Massachusetts. Born in New York, his family moved to Boston and settled in the West End. With the support of his parents, Kaplan excelled academically and at fifteen entered Harvard University. While at Harvard, Kaplan continued to prove his academic prowess. He was elected into the Phi Beta Kappa honor society, graduated in three years, and attended Harvard Law School as one of the youngest members and graduates.

After graduating from law school, Kaplan spent seven years under the tutelage of Louis Brandeis, and gained skills that led to employment at the distinguished law firm of Nutter, McClennen and Fish. This notable position led to an appointment as the President of the Boston Bar Association and as a committee member on the Federal Judiciary of the American Bar Association. As a senior partner at Nutter, McClennen and Fish, Kaplan earned great respect from his colleagues and soon began his career as a judge with a seat as Justice of the Dorchester Municipal Court.

Among his many interests was the financial welfare of the city of Boston. This is reflected in his choice to serve on the boards of the Boston Finance Commission, the Federated Department Stores, Filenes’s, and the Provident Institution of Savings. Judge Kaplan also had a deep respect for the educational institutions of Boston and was a trustee of Wellesley College, Hebrew Teachers College of Boston, Boston Society of Natural History, and the Museum of Science. He was also a member of the Board of Governors of Boston University.

Judge Kaplan’s wide range of interests in the welfare of the Jewish people led to his service as a board member, director, and trustee of a variety of committees such as Beth Israel Hospital, World Peace Foundation and International Friendship League, War Emergency Council, Jewish Welfare Board, and Administrative Committee of United Palestine Appeal. He was the founder of the Boston Chapter of the American Jewish Committee.

Judge Jacob J. Kaplan died in 1960.

Source: Biographical Note to the Jacob J. Kaplan Papers. The Wyner Family Jewish Heritage Center at New England Historic Genealogical Society.

Harold B. Platt Dies After Short Illness
New York Investment Broker Was Church Treasurer.

   Harold Birdsall Platt of 11 Duryea Road, Upper Montclair, New York investment broker, died yesterday in Mountainside Hospital after a short illness. Funeral services will be held tomorrow afternoon at 2 o’clock at the Home for Services, 56 Park Street. The Rev. Dr. George C. Vincent, minister of the Union Congregational Church, will officiate. Interment will be in Greenwood Cemetery, Brooklyn, N. Y.

Born in Brooklyn, Mr. Platt was graduated from Harvard in 1908 and Harvard Law School in 1911. After working in the office of the New York City District Attorney for several years, he left the law business to join the James M. Toolan Company, New York City securities specialists, with which firm he had been a partner for the past twenty years.

Mr. Platt was treasurer of Union Congregational Church, treasurer of the Middle Atlantic Conference of  Congregational Christian Churches, a director of the Margaret and Sarah Switzer Convalescent Home for Girls in Manasquan and a member of the National Republican Club, New Jersey Harvard Club and Harvard Engineering Club.

Surviving Mr. Platt are his wife, Mrs. Gertrude Middleditch Platt; a daughter, Mrs. Henry Guyon Kiggins Jr. of North Plainfield, and a son, Willard E. Platt of Red Bank.

Source: The Montclair Times (New Jersey), March 1, 1951, p. 4.

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Earlier Accounting Exams at Harvard

1901-02
1902-03
1903-04
1904-05
1905-06
1906-07
1907-08

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William M. Cole
His Textbook

Accounts. Their Construction and Interpretation for Business Men and Students of Affairs. Boston: Houghton Mifflin Company, 1908.

“The first issue of this book was brought out at a time when no general, non-technical, non-professional treatise on accounting had been published . The author had then been giving for eight years a course of instruction to seniors in Harvard College on the principles of accounting, and believed that many business men and students of affairs would be interested to see briefly but comprehensively how accounts are constructed and interpreted.”
Revised and enlarged edition, 1915.

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Course Enrollment
1908-09

Economics 18. Asst. Professor W. M. Cole, assisted by Messrs. Johnson, Kaplan, and Platt. — Elements of Accounting.

Total 167: 3 Graduates, 84 Seniors, 40 Juniors, 7 Sophomores, 33 Others.

Source: Harvard University. Report of the President of Harvard College, 1908-1909, p. 68.

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Course Announcement with Description
1908-09

COURSES ESPECIALLY PREPARING
FOR A BUSINESS CAREER

Among the courses […], those on the industrial and financial phenomena of modern times are useful for students who propose to enter on a business career. Such are the courses on Money and Banking (8a and 8b), Commercial Crises and Cycles of Trade (12). Economics of Transportation (5), Problems of Labor (9a). the Economics of Corporations (9b), the Economic and Financial History of the United States (6b), and European Industry and Commerce in the Nineteenth Century (6a). In addition, the following courses are designed more particularly to aid in the understanding of the problems likely to be met in business life, and are arranged with special regard to the needs of those looking to such a career. They are primarily for students who have reached or approached the close of their general education.

*18 ¹hf. Elements of Accounting. Half-course (first half-year).
Mon., Wed., and (at the pleasure of the instructor) Fri., at 3.30. Asst. Professor COLE.

This course is designed to show the processes by which the earnings and values of business properties are computed.
It is not intended primarily to afford practice in book-keeping; but since intelligent construction and interpretation of accounts is impossible without a knowledge of certain main types of book-keeping, practice sufficient to give the student familiarity with elementary technique will form an important part of the work of the course. The chief work, however, will be a study of the principles that underlie the determination of profit, cost, and valuation. These will be considered as they appear in several types of business enterprise. Published accounts of corporations will be examined, and practice in interpretation will be afforded. The instruction will be chiefly by assigned readings, discussions, and written work.
This course is regularly open only to Seniors and to Graduates who have had Economics 1. Students intending to enter the Graduate School of Business Administration are expected to take this course in preparation for the advanced courses in accounting.

[The other course was Economics 21 ¹hf, Principles of Law governing Industrial Relations taught by Professor Wyman.]

Source: Official Register of Harvard University, Vol. V, No. 19 (1 June 1908). History and Political Science Comprising the Departments of History and Government, and Economics, 1908-09, pp. 56-57.

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ECONOMICS 18
Mid-year Examination, 1908-09

Arrange your answers in the order of the questions. Answer the exact questions asked and do the exact problems set, and no others.

1. What is the complete function of a ledger as distinguished from that of a modern journal?
2. Supposing a journal, a cash book, and a sales book to be kept, show (a) normal entries without duplication, and (b) ledger postings, for the transaction below.
   A partnership is dissolved, and in settlement the retiring partner is given the following:—

Cash, $20,153,
Bills receivable (notes of customers, average due in one month, with discount allowed of $25.00), $5000,
Bills payable (of the new firm, due in one month), $5000,
Merchandise (the complete line of dry goods in stock), $7550.

Indicate, by posting checks, from what source each portion would get into the ledger.

3. The items below appear on a six-column statement.
   1. Show the closing of the ledger for the accounts named.

(Italics for red ink.)

			Resources	Liabilities	Losses	Gains
Proprietor		25,000		25,000
Real Estate	15,000		14,775		225
Merchandise	55,000	65,000	18,000			28,000
Rent	1,200			150	1,350	50
Loss and Gain	140				140

1. 2. Is this partial statement correct? Defend your answer.

4. The following sorts of expenditures have been incurred.
   1. In entering, how far does good accounting allow their consolidation, i.e., what is the minimum number of accounts that may contain them? Explain the purpose of each account so to be maintained, and state why it must be maintained.
   2. What is the maximum feasible differentiation, i.e., the greatest number of accounts likely to be useful for these items? Name and defend each, and indicate which items should go to each,

Feed of delivery horse.
City directory.
New delivery harness.
Repairing wagon.
Wages of teamster.
Shoeing horse.
Subscription to “Trucking Journal.”
Delivery baskets.
Feed bag.
Bonus paid in trading an old horse for a younger one.

5. In closing books at the end of a year
   1. what allowance, if any, should be made for interest on the notes below?
   2. Show for each note the resulting effect on the balance sheet. Assume all notes to have two months yet to run, and interest to be at 6%.

Bills receivable	No. 120,	bearing interest	$1,000
Bills receivable	No. 127,	without interest	2,000
Bills payable	No. 74,	without interest	3,000
Bills payable	No. 84,	bearing interest	4,000

6. On Dec. 28, 1908, you buy a patent right under which you can manufacture and sell annually for five years in one State 1000 desk attachments at a profit of one dollar each over the profit on the only unpatented marketable article.
   1. From the table below, determine as accurately as you can the theoretical value of that patent right when money is worth 5%.

Table of 5% ratios
0.746215	0.907029	1.102500
0.783526	0.952381	1.157630
0.822702	1.000000	1.215506
0.863838	1.050000	1.276282
		1.340096

1. 2. Is your figure absolutely accurate for the theoretical value, or is it based on a calculable error? If the latter, how should you calculate the error?
   3. At the close of the year, shall the patent right appear on the balance sheet? If so, where and for what approximate amount?
   4.  Shall that patent right appear on a detailed balance sheet for Dec. 31, 1909, on a detailed income sheet for 1909, on both, or on neither? Defend your answer.

7. The balance sheet of a corporation on Jan. 1, 1908, was as follows:

Merchandise	$65,000	Capital stock	$75,000
Bills receivable	15,000	Bills payable	10,000
Accounts receivable	8,000	Accounts payable	5,000
Fixtures	3,000	Surplus	5,000
Cash	4,000
[Total]	95,000		95,000

During the year 1908, the net income was $10,000; purchases, $200,000; sales, at 20% above cost price, $240,000; cash decrease, $3,000; bills receivable accepted, $5000 in excess of such notes collected; accounts receivable charged, $1000 in excess of accounts receivable collected; bills payable extinguished, $1000 in excess of those issued; accounts payable incurred, $2000 in excess of those paid; dividends paid, $8000.

Show the balance sheet for the new year.

8. Was the business of 1908 outlined in Question 7 favorable or unfavorable? Explain in detail.

Source: Harvard University Archives. Harvard University. Mid-year Examinations, 1852-1943. Box 8, Bound Volume: Examination Papers, Mid-Years 1908-09.

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ECONOMICS 18
Year-end Examination, 1908-09

Arrange answers as far as possible in tabular form.

I.
Take all.

1. What is the purpose of the following accounts:—

Bills Receivable.	Interest Due.
Capital Stock.	Interest Accrued.
Insurance.	Interest Earned.
Power.	Discount on Bonds.
Accounts Receivable.	Neglected Discounts.

2. For additions chargeable to capital, $2,000,000 is spent out of current receipts. Two months later, notes are issued at par to recoup the treasury ready for the semi-annual payment of dividends. The dividends are paid. Six months later, capital stock is issued for the notes, exchanged on the basis of $90 in stock for $100 in notes.
   Disregard interest, and show journal entries to represent the transactions.
3. The figures below are what a bookkeeper finds on his books at the close of the year.

Capital stock		$169,000
Real estate	$70,000
Mortgages payable		55,000
Bills payable		25,000
Bills receivable	15,000
Accounts receivable	17,000
Merchandise	150,000
Cash	7,000
Expenses	15,000
Interest	3,000
Taxes	2,500
Sales		30,500
	$279,500	$279,500

He reports to the directors a balance sheet as follows:—

Real Estate	$63,000	Capital Stock	$169,000
Bills receivable	15,000	Mortgages payable	55,000
Accounts receivable	17,000	Bills payable	25,000
Merchandise	130,000	Reserve for bad debts	4,250
Cash	7,000
Profit and loss	21,250
	$253,250		$253,250

Explain all apparent discrepancies between the two sets of figures.

4. What is the significance of a debit balance, in intervals between periodical closings of the books, for the following accounts:

Expense	Accumulation for Bond Discounts
Cash	Patent Rights
Stores	Sinking Fund

5. You join a summer colony within easy rail communication of the city. A general organization of members of the colony controls a central club-house with grounds. The restaurant privilege is sold to outsiders. Facilities are offered to members for tennis, golf, billiards, bowling, boating, swimming. For all these privileges, fees are charged and expenses are incurred. All excess income is to be carried to a general-purpose fund. Entertainments are provided at club expense. You are chosen president of the club.
   Outline a general plan for applying the principles of accounting to assist in making the club successful. What ledger accounts should be kept, what items should be carried to each, and what statistics should be gathered?

II.
Take two.

6. The balances of a single proprietor’s set of books kept by single entry are as follows:—

Accounts receivable	$15,000
Accounts payable	20,000
Cash	7,000
Bills payable	14,000

He finds the following property:—

Merchandise	$56,000
Furniture, etc.	1,500
Bills receivable	4,000

Show a balance sheet for the business when the books are converted into double entry.

7. What is the operation of a bond sales account?
8. A is expected to live 10 years; B, 15 years; C, 20 years. A has a life interest in property yielding $5,000 annually; B, a life interest in property yielding $3,000 annually; C is the remainder man for both properties. How could you determine the value of C’s life interest in both properties?
9. You pay $500 for a lease entitling you to use a certain building at a rental of $1,000 a year for ten years. At the end of five years you dispose of the lease for the remaining five years. How can you tell whether you have made a profit on the sale of the lease?

Source: Harvard University Archives. Harvard University, Examination Papers, 1873-1915. Box 8, Bound vol. Examination Papers 1908-09; Papers Set for Final Examinations in History, Government, Economics,…,Music in Harvard College (June, 1909), pp. 47-49.