Chapter VI

DESCRIPTIVE OUTLINE OF THE COURSE

In looking over the following detailed outline of the Modern Business Course, you will see more clearly how closely every section is related to daily business practice.

The italics after each title give the actual chapter headings; the following matter gives a brief discussion of the purpose and scope of each section of the Course.

BUSINESS AND THE MAN

"_Scientific Training for Business_," _an introduction to the Modern Business Course and Service_ _Nature and aim of business_ _The profit problem_ _Economics and sociology_ _Psychology_ _Ethics of business_ _Vision, or the idea_ _Personal efficiency_ _Health_ _The efficient business man_ _The executive_ _Subordinate or junior officers_ _The rank-and-file worker_ _Personality_ _Character Analysis_ _Opportunity_

The most important thing in business is the human element--you. Every man must have real ambition, high ideals, and a definite goal in mind before even a correct knowledge of business principles will help him to more than a half-way success.

The purpose of this first section of the Course is to discuss the viewpoint of the successful business man in an inspiring way, so that you may be inspired yourself and so that you may be able to inspire others about you.

"Scientific training for business" is an introduction to the whole Modern Business Course and Service. In it Dean Johnson tells you in what way you should read the Course, how to get the most out of it, and how to use the equipment so as to bring results.

The Course begins with an analysis of business operations. It shows briefly what are the dominant features of business life which no man can afford to neglect. It then takes up the relation of personal qualities to business success; it shows what personal characteristics are helpful and how they may be cultivated; and it also points out the traits of mind, manners and morals which hinder men in their business career. The first point in understanding business problems and business principles is to approach them with the right attitude of mind.

This section of the Course serves to bring the reader into personal touch with the business problems which will engage his attention more in detail in the subsequent sections and thus furnishes a useful introduction to the entire Course.

ECONOMICS--THE SCIENCE OF BUSINESS

_Purpose and scope of economics_ _Fundamental concepts_ _Land and capital_ _Labor and enterprise_ _Three fundamental laws_ _Consumption of wealth_ _Value and the consumer_ _Value and the producer_ _Value and the trader_ _Money_ _Credit_ _Money, credit and prices_ _Foreign trade_ _Rent_ _Interest_ _Wages_ _Profits_

Economics is the foundation stone upon which the science of business is built. It underlies all business just as mathematics underlies all branches of engineering. It is the basic subject of the Course, and its general principles should be thoroughly understood before taking up the subjects treated later.

The book is written for the general reader, who has little or no knowledge of economic theory. It gives a clear idea of the business problems and forces with which business men deal and enables the reader to form intelligent judgments of his own.

This section of the Modern Business Course makes clear the laws governing the prices of goods, the wages of employes, the profits of employers, the processes of exchange, the functions of money and credit, and the rent of buildings and land. It takes up in comprehensive manner the problems raised by trade unions, by trusts, by governmental taxation and by the growing tendency toward governmental regulation of business.

An understanding of all these live, interesting business problems is an essential part of the mental equipment of a broad-gauged business man, working under present-day conditions.

BUSINESS ORGANIZATION

_Purpose and forms of business organizations_ _Sole proprietorship_ _General partnerships_ _Limited partnerships_ _Syndicates_ _Business trusts_ _Corporations as business units_ _General aspects of corporations_ _Incorporation of companies_ _Dissolution of corporations_ _Stock and dividends_ _Stockholders_ _Meetings of stockholders_ _Directors and officers_ _Intercorporate relations_ _Consolidations, sales and leases of assets_ _Holding companies_ _Illegal combinations_

If you are in business for yourself, or in some way become interested in a growing business, there is nothing that is of greater interest than your rights and the rights of other men who are in the concern.

The application of the correct principles of production, marketing, financing and accounting are necessary to insure success, as they determine the profits of the business as a whole. Every man goes into business to secure more income for himself, and the amount of his own income will depend, not only on the amount of the profits of the whole business, but on his own proportionate share of these profits. The division of the profits into shares depend almost entirely on the form of organization.

Moreover, when men enter business they hazard not only their time and a definite amount of wealth in the enterprise, but perhaps other wealth that was intended to be kept separate. Indeed, embarking on a business venture may be but the beginning of the loss of the income of future years when all chance of profits has ceased and the business represents nothing but a lot of debts that remain to be liquidated.

Risk is an important element that is varied by the form of organization selected. This section traces briefly the rise of the corporation through the individual enterprise, the partnership and the joint stock company, and states the advantages and disadvantages of each of these forms of conducting business, as well as those of the corporation. This section of the Course constitutes the first step in the study of corporate finance.

PLANT MANAGEMENT

_The basis of modern industry_ _Fundamental industrial principles_ _Characteristics of modern industry_ _Methods of organization and administration_ _Coordinative influences_ _Purchasing_ _Storing material_ _Planning and production departments_ _Insuring results--securing industrial data_ _Standards_ _The control of quality--inspection_ _Rewarding labor--older methods_ _Rewarding labor--new methods_ _Comparison of wage systems--profit sharing_ _Statistical records and reports_ _Location of industrial plants_ _Arrangement of industrial plants_ _Practical limitations in applying industrial principles_ _Problems of employment_ _Employes' service_ _Science and management_

Modern management of industrial plants is characterized by planning and system. Old processes and old methods no longer command respect because they are old. They have been subjected to searching analysis in the hope of finding better ways of doing things. We look today not for the history, but for the reasons of every phase of plant management.

This is our aspect of the general industrial changes which have transformed modern industry and made it a high-powered productive instrument. It is not an isolated thing, but just as significant a part of modern business methods as are improved transportation, increased credit and present-day banking.

In this part of the Course, the relation of plant management to the characteristic development of modern life is first traced, and then the changes displayed which scientific methods have made in the conduct of manufacturing processes. These affect the structural organization of business, the relations of the directing and managing organs to one another. They also affect the operations of these managing units, the purchase and storage of materials, the routing and sequence of work, the best utilization of machinery and the like.

The keynote of the volume is efficiency in productive effort and the principles which underlie it.

MARKETING AND MERCHANDISING

_Marketing: Modern distribution_ _The field of marketing_ _Study of the product_ _Study of the market_ _Trade channels_ _Selling to the jobber_ _Wholesale middlemen_ _Selling to the retailer_ _Selling through exclusive agencies_ _Influencing retail sales_ _Selling to the consumer_ _Good-will and price maintenance_ _Reaching the market and the complete campaign_ _Merchandising: The jobber_ _Modification of the jobber's service_ _Problems of the jobber_ _Retail competition_ _Retail types_ _Chain stores_ _Mail-order selling_ _Training the sales force_ _Buying_ _Stockkeeping_ _Cooperation for service_

There are three different kinds of things that must be considered by everyone who has anything to sell. One group of considerations has to do only with personal salesmanship and sales management. Another has to do only with advertising. Still a third is concerned solely neither with personal salesmanship nor with advertising, but is common to both. Before an effective force of salesmen can be selected and trained and an advertising campaign mapped out, the plan behind the personal selling and advertising campaign must be devised--the marketing methods must be determined.

The considerations here may be grouped under three heads: the goods to be sold, the market for the goods, and the methods of reaching that market.

A number of questions must be asked and answered about the things to be sold. For example: Is there a ready demand or must one be created? Is the commodity a necessity or a luxury? Is it subject to seasonal variations? Is the trade-mark well known? And so on.

The first part of the Text, Marketing, concerns the problems of the manufacturer; the second part, Merchandising, treats of the problems of the dealer, both wholesaler and retailer. Between them they present a complete picture of the processes by which goods reach the consumer, and reveal the tendencies in modern distribution.

SALESMANSHIP AND SALES MANAGEMENT

_Salesmanship: The power of personal salesmanship_ _Staples, branded staples and specialties_ _Selling process--preliminary to the interview_ _Selling process--the interview_ _Selling process--the agreement_ _Selling process--miscellaneous_ _Human appeals that sell_ _Development of character and caliber_ _The salesman's duties and responsibilities_ _Cooperation, influence and friendship_ _Sales management: The sales manager--his qualifications and duties_ _Building an organization--selecting men_ _Building an organization--training salesmen_ _Selling methods and the selling equipment_ _Compensation and territory_ _Sales records_ _Cooperation with salesmen_ _Sales contests_ _Sales conventions_

There is no subject which is more universally interesting to everyone in business than selling.

Salesmanship in its broadest sense is essentially the selling of one's point of view, the ability to start with the other fellow's point of view and lead his mind to accept yours. When an individual endeavors to influence another, he is practising salesmanship. In this broad sense, everyone will profit by a knowledge of the principles of salesmanship and selling methods.

In this portion of the Modern Business Course, the salesman is shown the necessity of learning something of his prospect previous to the interview. Suggestions are also made for getting to see the buyer. The developments in a sale are discussed in such a way as to enable the salesman to build an effective, man-to-man transaction, and the human appeals that sell are outlined.

After discussing the qualifications and duties of the sales manager, methods to be employed in the selecting, training and handling of men are detailed. The training of retail sales people is discussed. The planning of the salesman's equipment, the building of a sales manual, the apportionment of territory are gone into. Methods of keeping sales records and statistics are outlined; directions given for the handling of sales contests and conventions, the editing of a house organ, and the apportioning of quotas.

ADVERTISING PRINCIPLES

_Advertising--a constructive force in business_ _Fundamentals of advertising_ _Getting the advertisement seen_ _Getting the advertisement read_ _Making the advertisement understood_ _Making the advertisement produce action_ _Human appeals in advertising_ _Word values in advertising_ _"Getting the order" copy_ _"Getting the inquiry" copy_ _"Directing the reader" copy_ _"Molding public opinion" copy_ _Preparing the advertisement_ _Layout of advertisements_ _Booklets, catalogs and folders_ _Drawings and reproductions_ _Printing art in advertising_ _Trade-marks, slogans and catch phrases_ _Legal limits and restrictions on advertising_

Considering the large number of progressive concerns entering the field of advertising each year, and profiting thereby, the average business man's lack of knowledge concerning advertising principles is lamentable.

Few have any ability either to write or to judge copy, and almost all are at a loss to deal intelligently with the printer.

This section of the Course discusses the various classes of copy divided according to the results each is designed to accomplish. The value of word tone in writing and how to secure it are indicated. Instructions for preparing and laying out the advertisement are given.

The technique of the printing art--type faces, paper, printing processes, half-tones and line-cut illustrations--is discussed.

The advertising slogan, the package design and the various considerations in connection with the trade-mark are treated.

The business man is prepared to correlate the principles of advertising with those of marketing methods, and to bring an understanding of both to his study of advertising problems of wholesale and retail merchandising.

OFFICE ADMINISTRATION

_The office in modern business_ _Location, planning and layout of the office_ _Office equipment and supplies_ _Office appliances_ _Selection of employes_ _Employment tests and records_ _Training_ _Stimulation of employes_ _Filing_ _Interdepartmental communications_ _Office manuals_ _The worker's compensation_ _Welfare_ _Office organization_ _Planning_ _Office control_ _Work reports and their use_ _The art of management_

It is only in recent years that individual business enterprises outside of the manufacturing field have grown to such importance as to bring a large number of employes under one management. Today the problems of the office are no less urgent than those of the shop.

Office administration is in some respects like, in other respects unlike, plant management. It is alike in that it pursues the same ideals of efficiency. It is unlike in that machines and equipment fall into the background and the human element looms large in the foreground of office work.

Methods of conducting clerical work have, since the advent of the various office machines, of which the typewriter was the pioneer, undergone rapid transformation. Underlying these changes there have been principles, more or less clearly recognized, which it is the aim of the Text to discover and present in an orderly and systematic fashion.

In few departments of office work have standardized processes based upon scientific principles made such headway as in the employment field. Hiring employes for office work, training them for their duties, stimulating them to their best effort, adjusting wages to work performed, and providing for deserved promotions, are no longer casual occupations of some general offices, but the work and special concern of the trained office manager.

Here, as elsewhere, concentration and specialization are beginning to reveal the principles underlying successful effort. Such principles concern not only the operations, but the organization of the office and its various parts.

ACCOUNTING PRINCIPLES

_Development and scope of accountancy_ _Accounts and their purpose_ _Classification of accounts_ _Double entry bookkeeping_ _Books of account_ _Applying accounting principles--the original entries_ _Applying accounting principles--the ledger records_ _Applying accounting principles--summarizing results_ _Columnar books_ _Opening, operating and closing the books_ _The trial balance_ _Economic summary_ _The balance sheet_ _Single entry bookkeeping_ _Continental system of bookkeeping_ _Depreciation_ _Methods of computing depreciation_ _Labor-saving devices_ _Internal checks_

As business becomes more complex we are more and more dependent upon accounting methods to show us the trend of the individual business in which we are interested.

Hence a knowledge of accounting principles is indispensable. Yet, even among experienced bookkeepers, comparatively few have a clear understanding of the principles which underlie all correct methods of keeping financial records.

This section of the Course, therefore, starts with a clear explanation of the fundamental principles of bookkeeping, and progresses step by step until it reaches the most complicated cases of partnership and corporation accounting.

Within recent years the great importance of proper accounting methods in the conduct of business has come to be fully recognized.

This section of the Course should enable any executive or accountant to determine what accounting methods are best adapted to his own line of business.

CREDIT AND COLLECTIONS

_Mercantile credit_ _Book credit_ _Documentary credit_ _Granting credit--personal considerations_ _Granting credit--business considerations_ _Sources of credit information_ _Cooperative methods in credit investigation_ _Analysis of credit information_ _The credit man_ _Credit management_ _Collecting the money due_ _The collection manager and his work_ _Principles underlying collection effort_ _Collecting on a friendly basis_ _Unfriendly stages of collection_ _Credit protection_ _Bankruptcy_ _The role of the credit department in developing business_

When a bill of goods is sold, the transaction is by no means complete--that is, if the sale is on credit. The purchaser must pay the bill. But some purchasers cannot pay, others will not; therefore caution must be exercised in granting credit, and pressure brought to bear in obtaining payment.

Often seekers after credit are foolishly offended at the questions they must answer. They do not realize how personal is the favor they are asking, nor do they usually understand the combination of factors which the credit man must consider.

These factors range all the way from personal habits of the applicant to a survey of general business conditions.

There is a well-organized machinery for gathering credit information both in this country and abroad. This machinery, however, should be supplemented by the personal observation of the salesmen, many of whom now fail to cooperate in the right spirit with the credit manager.

The credit operation is incomplete till the goods are paid for; collections are the complement of credit granting, and they receive an extended treatment in the Text. As a last resource, the law may be resorted to, as is evident in the treatment of credit protection and bankruptcy.

The possibilities of the credit department as an agency in building up business, which have not always been understood, are set forth in the concluding chapter.

BUSINESS CORRESPONDENCE

_Letters that get action_ _Seeing through the reader's eyes_ _The spirit of the letter_ _The proposition in the letter_ _The proposition analyzed_ _Fundamentals of the presentation_ _The aid of formula in presentation_ _Applying formulas to the presentation_ _Routine and individual letters_ _Adjusting complaints by letter_ _Credit letters_ _Collection letters_ _Working the mailing list_ _Planning the letter_ _Writing the letter_ _Mechanical form_ _Getting the most out of words_

Nearly all of us are constantly receiving and sending letters, and we know in our experience the common types--the nasty letter, the sloppy letter, the cold-as-an-iceberg letter, and, on the other hand, the direct yet cordial letter which makes us feel as if we had gripped a friendly hand.

The profit-making influence of good correspondence can hardly be overestimated.

A good sales letter may be the means of getting thousands of dollars' worth of business; a poor adjustment letter may be the cause of losing a worth-while customer.

To a large extent business must be carried on by means of letters, and there are few subjects of more vital importance to the business man than business correspondence.

Business letters always have a direct purpose in view and there are certain underlying principles which should be observed in all business letters, whatever their particular purpose. But these letters serve many different purposes, and some of the prominent types and their characteristics are treated.

Especial attention is given to sales correspondence, which forms a most important branch of business correspondence.

COST FINDING

_The importance of cost finding_ _Problems of cost finding_ _Identification of costs_ _Issuing and evaluating material_ _Evaluation of labor costs_ _Expense or burden_ _Depreciation_ _Distribution of factory expense_ _Production centers and the supplementary rate_ _Effect of volume of work on expense distribution_ _Other features of expense distribution_ _Distribution of administrative expense--résumé_ _Assembling and recording costs_ _Analysis and reduction of costs_ _Predetermination of costs--materials and labor_ _Predetermination of costs--expense_ _Application of cost finding methods_

Of late years, and as a direct result of growing competition in all branches of industrial enterprise, the subject of cost is receiving increased attention.

Every year sees hundreds of progressive concerns adopting methods designed to ascertain the real cost of producing and selling goods and of managing a business enterprise.

Manufacturers are no longer satisfied with merely making a profit. They want to know what lines are paying and what lines are not--not in a general way, but specifically in actual figures. They want to know which departments are producing economically and which are not.

In this part of the Course, the various methods of keeping track of costs are described and illustrated. Particular attention is given to the mixed question of allotting general factory expense or burden.

The possibilities of predicting costs are fully discussed and the significance of this development of cost finding methods is fully impressed upon the reader.

The problem of costs is one of the widest application in business management and its significance in different lines of business is pointed out.

ADVERTISING CAMPAIGNS

_The purpose of the campaign_ _Analysis of demand and competition_ _The advertising appropriation_ _Methods of identification_ _The advertising department_ _The advertising agency_ _Advertising media_ _Weighing circulation_ _Weighing prestige_ _Letters and direct advertising_ _Sampling_ _How periodicals are used_ _The use of signs_ _Campaigns to obtain distribution_ _Campaigns to obtain dealer cooperation_ _Mail-order campaigns_ _Public sentiment campaigns_ _The trader's campaign_ _The campaign as a whole_

In the Modern Business Course and Service the study of advertising is divided into three parts. First, in Marketing Methods there is a complete presentation of the plan behind the campaign--of the things that have to be considered by anyone who has anything to sell, before he sends out salesmen or prepares advertising.

The section of Advertising Principles shows what advertising can do for business, guides one in choosing the right advertising appeal, and treats of the technique of advertising, writing the copy, preparing the illustrations, and getting the advertisement before the public.

There is much more to advertising, however, than the making of a preliminary study of the writing of advertisements.

The advertiser has to consider problems of organization, methods of identifying his goods, his relation with agencies, the selection of media, distribution, dealer cooperation, and a host of other things, all of which have an important part in the complete campaign.

This section deals with the many essential parts of an advertising campaign which have not been considered in preceding sections of the Modern Business Course. It gathers together all the diverse considerations of the advertiser, shows their relation one to another, and binds them into a unified whole.

CORPORATION FINANCE

_The corporation; a preliminary sketch_ _Capital of the corporation_ _Capital stock_ _Stock not paid in cash_ _Trade credit and bank loans_ _Short-term loans_ _Mortgage bonds_ _Collateral trust bonds_ _Bonds secured by leases_ _Miscellaneous bonds and preferred stock_ _Amortization of bonds_ _Capitalization_ _Investment and maintenance of capital_ _Income, dividends and surplus_ _Promoting the new enterprise_ _Promoting consolidations_ _Selling stocks and bonds_ _Financing the small company_ _Financing reorganizations_

The advantages of the corporation have made it the most popular form of financial organization, and nearly all business men are now interested in one way or another in the formation or management of corporations, or in the buying and selling of the stock and securities of corporations.

The stability of practically every business concern depends in a very large measure upon the keenness of judgment used in its financial management.

This section of the Course enables one to think along financial lines with accuracy and decision. The methods by which corporations are promoted and financed are fully described, and the principles that underlie successful corporate management are stated.

The different kinds of bonds, such as mortgage bonds, collateral trust bonds, bonds secured by leases, etc., are explained and the methods of selling them discussed.

There are sections on capital and its maintenance and a full discussion of income, dividends and surplus that will be of value to the executive and to the investor.

In the last three chapters the application of the principles of corporation finance to the small company is fully described.

TRANSPORTATION

_The railroads and the shipping public_ _The Government takes the railroads_ _Government reorganization of railroads_ _Railroad rates_ _Classifications_ _Rates in Official Classification and Southeastern Territory_ _Transcontinental rates and the Panama Canal_ _Export and import rates_ _Special services and charges_ _Terminal services and charges in New York_ _Express and parcel post_ _The Transportation Act_ _Inland water transportation_

Business as it is conducted today would not be possible without the railroad.

The corner grocery store as well as the big manufacturing company is directly affected by traffic, rates and methods. The prosperity of many a business and community is largely dependent upon relations with transportation companies. Yet many business men are unfamiliar with even the elements of rate making and traffic handling.

The war made great changes in railroad organization and when the railroads were returned at the close of the war to their former owners a new set of problems had to be faced. Rail rates had assumed a new importance, labor and other costs had increased and both shipper and carrier were called upon to consider transportation in an entirely different light than before the war. All of these problems receive careful consideration in this Text, and the tendencies of the times, so far as they have been clearly revealed, are pointed out.

Classifications, rates, special services, terminal facilities and charges are some of the specific questions discussed.

FOREIGN TRADE AND SHIPPING

_Foreign trade: Relation of foreign trade to domestic business_ _The national aspect of foreign trade_ _The market_ _Governmental trade promotion_ _Private trade promotion_ _Indirect exporting_ _Direct exporting_ _The conditions of sale_ _The export department_ _Cooperation for foreign trade_ _Making an export shipment_ _Importing_ _Shipping: Principles of ocean transportation_ _The freight service_ _Ports and terminals_ _Ocean freight rates_ _Rate agreements_ _The merchant marine_

The events of recent years have turned the attention of business men of America once more to the problems of foreign trade.

This section of the Course describes the development of our trade with foreign countries. It describes various changes which are at work in this field and the methods by which foreign trade is conducted.

Intimately associated with this subject is that of shipping; the transportation problems involved in foreign trade, questions of routes, rates, registry and the like are given particular attention.

The advantages and disadvantages of American and foreign shipping and the problems involved in the up-building of an American merchant marine receive careful consideration.

BANKING

_Classes of banks_ _Operations of a commercial bank_ _The bank statement_ _Loans and discounts_ _Establishing bank credit_ _Bank notes_ _Deposits and checks_ _The clearing house_ _Bank organization and administration_ _Banks and the government_ _American banking before the Civil War_ _Banking in Europe_ _Canadian banking system_ _The National banking system_ _Banking reform in the United States_ _The Federal Reserve system_ _State banks and trust companies_

Business concerns deal in bank credit every day. They have on deposit large amounts of their capital. They rely upon their banks' stability. And yet how few can read a bank statement with real insight and judgment.

The fundamental principles underlying all banking operations are presented under this heading. The nature of money and its relation to credit and capital are described, and the conditions which lead to a general rise or fall of prices are set forth.

The important banking and monetary experiences of the United States are reviewed and full descriptions of the banking systems of the United States, Canada, England, France and Germany are given.

In connection with banking, the source of the banker's lending power and its relation to cash on hand are indicated, as well as the distinction between the bank note and the bank deposit, and the factors controlling the rate of discount.

Banking practice is in large part a study of the banking laws and customs prevalent in the United States, including those governing Federal Reserve Banks, State banks and trust companies.

The subject is fully discussed in this part of the Course, as are also the technical aspects of banking in all details.

INTERNATIONAL EXCHANGE

_Domestic exchange_ _Federal Reserve Bank clearings_ _General aspects of foreign exchange_ _Basal factors of exchange_ _Restoration prospects for rates of exchange_ _Foreign remittances_ _Bills of exchange_ _A day in an exchange box_ _Finance bills_ _Arbitrage_ _Rates of interest_ _Gold shipments_ _Sterling exchange_ _Gold standard_ _Gold exchange standard_ _Silver and paper exchanges_ _London and New York as financial centers_ _War and the exchanges_ _Tables_

The early part of this section of the Course deals with inland exchange and describes the method by which settlements are made between different parts of the same country. When this is fully understood the problem of foreign exchange becomes very simple. It is the application of the same principles complicated only by the difference in money units between different countries.

The "Foreign Exchange" department of banking is of such great importance and presents so many difficult questions that it deserves and is accorded special treatment. The reader is given a full description of the mechanism of the exchange market and is shown how money is made in foreign exchanges.

He learns how the vast amount of export and import trade is made possible through the interrelations between the foreign exchange markets of New York, London, Paris and other large centers. He also learns concretely how foreign shipments are financed and is given some valuable information concerning the influence of gold and other factors upon foreign exchange rates.

An important feature of this section is a thorough discussion of the best methods of handling export shipments. Many American and Canadian manufacturers are considering the advisability of going after foreign trade with greater vigor. They are usually puzzled when it comes to considering how to finance these shipments, which are often a long time in transit. The growing importance of export trade makes this section of the Course particularly valuable.

INSURANCE

_Risk and insurance_ _The life risks_ _Life insurance protection_ _Life policies and premiums_ _Modification of the ordinary life policy_ _Annuities and pensions_ _Group insurance_ _Functions of insurance carriers--the old line companies_ _Assessment and fraternal insurance_ _Government life insurance_ _Accident and health insurance_ _Liability insurance_ _Workmen's compensation insurance--general features_ _Workmen's compensation insurance--rate making_ _Fire insurance_ _Fire insurance policies_ _Marine insurance_ _Other forms of insurance_

Insurance constitutes a form of investment in which we are all interested, as purchasers of life insurance, fire insurance, casualty insurance, marine insurance, or of any other of the various forms which have come into existence. To buy insurance properly, one should know the principles that underlie rates and insurance operations, and should be able to judge the policy which covers these various essentials. Partnership and business insurance is much more used now than it has been heretofore and it is becoming an important element in adding to the stability of business.

Personal or life insurance occupies a large space in the Text. The nature of the life risk is discussed as well as the means of protection through the straight life policy. The various motives which have prompted these variations and the effect of these modifications upon the premium or the price of insurance are clearly explained. Various types of business organizations with divergent business methods have been devised for the purpose of conducting life insurance. The strength and weakness of the different organization forms are pointed out.

Another aspect of personal insurance is found in accident and health insurance. Obligations toward others generally for personal injuries is the basis of liability and workmen's compensation insurance, of which the latter has had an almost mushroom development of late years.

Property insurance brings up diverse questions in fire insurance and in marine insurance.

THE STOCK AND PRODUCE EXCHANGES

_Functions of stock exchanges_ _Leading stock exchanges_ _The New York Stock Exchange_ _Stock exchange securities_ _Execution of orders, transfers and settlements_ _Methods of trading_ _The speculative transaction_ _Relations of banks to the security market_ _Quotations and news services_ _The curb market_ _Benefits and evils of speculation_ _Influences that affect stock prices_ _Produce exchanges and their functions_ _The future contract_ _Organized spot market_ _The Chicago Board of Trade_

Almost every man in business comes into contact with some one of the exchanges.

Therefore, a detailed description of the organization, operation and management of the principal security and raw material markets of the world is of inestimable value. This is the aim of this section of the Modern Business Course and Service.

Speculation in goods and in stocks exists because it performs an economic service. It saves the manufacturer of cotton goods or flour, for example, from gambling by an operation known as hedging. Business men should understand how speculation performs this service.

The volume closes with a discussion of corners and of the influences governing security and produce prices.

ACCOUNTING PRACTICE AND AUDITING

_Accounting Practice_ _Proprietary accounts_ _Repairs, renewals, depreciation and fluctuation_ _Partnership problems at organization_ _Partnership problems during operation_ _Partnership dissolution_ _Partnership dissolution illustrated_ _Consignments and joint ventures_ _Fiduciary accounting_ _Insolvency accounts_ _Corporations_ _Branch accounts_ _Auditing_ _The auditor and his work_ _Scope of auditor's activity_ _Procedure and methods_ _Classes of audits_ _Verification of the asset side of the balance sheet_ _Verification of liabilities_ _Reports and certificates_

This section deals with the application of the principles of accounting to the complicated problems that arise in practice. The correct method of treating the proprietary accounts under the different legal types of organization are considered. The management of surplus, the treatment of reserves, the relation between funds and reserves and the method of handling sinking funds are discussed at length.

The differentiation between capital and revenue charges is perhaps the most difficult problem which the accountant has to face. The important principles involved in this problem are treated with numerous examples taken from actual cases. The difficult problems which arise in partnership and corporate accounting are fully explained.

Auditing is taken up from the business man's point of view rather than from the point of view of the practitioner. However, many points of interest to the practitioner and student are considered. The nature of the auditor's work is discussed and the different classes of engagements which auditors undertake are explained.

The auditor renders a report on his work at the conclusion of his engagement and the form and contents of his report are treated at length. The subscriber is shown the difference in certificates which auditors attach to balance sheets and the proper method of interpreting them is discussed.

FINANCIAL AND BUSINESS STATEMENTS

_Importance of classified information_ _Statistical and graphical statements_ _Auxiliary statements_ _Analysis and interpretation of income statements_ _Consolidated income statements_ _Valuation and interpretation of fixed assets_ _Valuation and interpretation of intangible assets_ _Valuation and interpretation of current assets_ _Valuation and interpretation of deferred assets_ _Treasury stock and its treatment_ _Interpretation of liabilities_ _Surplus, reserves and dividends_ _Sinking funds and other funds_ _Relation of working capital and income to assets_ _Consolidated balance sheets_ _Private budgets_ _Municipal budgets_ _Interpretation of professional reports_

The business man must understand accounting as far as he uses accounting knowledge in interpreting the progress of his business.

He wants not so much the details of accounting technique as the information necessary to enable him to use his accounting records properly. No one can expect to succeed in a big way without the ability to read financial and business statements--both on the lines and between the lines.

In every business the executive deals with a great variety of reports, statements, statistics and charts. This volume is designed to set forth the principles and to describe the methods by which they should be interpreted.

In the discussion of private and public budgets is included data that will be of the utmost value to every business man. You will find a thorough discussion of budget making and a clear outline of what should and what should not be done.

Instructions for the analysis of the reports and financial statements of industrial organizations and railway companies are set forth.

INVESTMENTS

_Farm mortgages_ _Urban real estate_ _Public bonds of domestic origin_ _Bonds of foreign origin_ _Bonds and stock contrasted_ _Bonds and stock classified_ _Railway securities_ _Analysis of railroad securities_ _Public utility securities_ _Industrial securities_ _Mining securities_ _Oil securities_ _The cycle of trade_ _Investment barometers_ _The dream land of finance_ _General rules_

Every successful business man at some time in his career has occasion to seek gilt-edge investments--either for his own surplus funds or for those of his company.

The daily losses of investors' capital are evidence of the need for a volume which aims to qualify you to make the critical analysis of securities which is necessary to an intelligent estimate of their value.

Such topics as farm mortgages and urban real estate are thoroughly discussed and the opportunities in this new field for the investor are clearly explained. Domestic bonds, foreign bonds, securities of industrials, railways and public utility corporations are analyzed in a way to help you make an intelligent estimate of their value.

In this volume you will find a thorough study of the subjects of security fluctuation and trade cycles, together with information on the general rules and technique of trading.

BUSINESS AND THE GOVERNMENT

_Business and the public in partnership_ _Taxation and business_ _Government, natural resources and the farmer_ _Government encouragement of industries and commerce_ _Public inspection of business_ _Problems of employment_ _Public service corporations_ _Local public utilities_ _Trusts and combinations_ _The postal service_ _Should public management be extended?_ _The great war: its effects, its influence, its lessons_

The Course opens with the personal relations of a man to a business and continues with an analysis of the various activities which constitute modern business. In this section it closes with the manifold relations of business to government.

Business is, as it were, in partnership with the government. In this partnership the government is active, as there are government departments aiming to promote business in manufactures and in trading.

Business, of course, cannot exist without government, and as the war demonstrated, government cannot exist without business. Business is restive, however, under the close supervision wrought of war necessities. How far is such supervision justified in times of peace?

This is a question both of principle and expediency and all its aspects are brought out in the discussion of specific problems, the tariff, trusts and corporations, public utilities, national and local, and the like.