Abstract An important element in the rehabilitation and sound growth of Japanese industry destroyed by the Pacific War, is the determination of the financial position and earning power of business enterprises. This prerequisite to the introduction of foreign capital, democratization of security investment, and equitable taxation, requires the improvement and unification of corporate accounting. Accounting in post-war Japan made an extraordinary development. More emphasis in corporate accounting has come to be laid on the income statement rather than on the balance sheet. The central problem of accounting in pre-war Japan, influenced by the regulations in the Commercial Code that aimed at the protection of creditors, was found in the study of the balance sheet, the items indicated and their valuation. In the development of profit and loss calculation, a noteworthy aspect is the abandonment of the all-inclusive principle, under which all costs and revenues were entered on one profit and loss statement.
Katsuji Yamashita (Tue,) studied this question.