Abstract The American Institute of Certified Public Accountants' annual publication "Accounting Trends and Techniques" provides ample evidence that accountants do not agree on the point of view that should be taken in the accumulation of financial information and its presentation in "general purpose" statements. Likewise, a survey of the literature of accounting reveals that writers on accounting theory do not agree on the point of view that should be taken in accounting. From the standpoint of complete exposition, it would be desirable to discuss some general aspects of accounting to which the author gave some attention before starting the analysis that leads to the residual equity concept. However, in the interest of brevity, that background will be presented in the form of a related series of conclusions. The investor group includes owners, whether they be proprietors, partners, common stockholders, or preferred stockholders, and creditors, including those who lend under various contractual arrangements such as debenture bonds, income bonds, mortgage bonds, collateral trust bonds, equipment trust certificates, mortgage notes, and oral or implied credit arrangements. While it cannot be argued that investment decisions are always based entirely upon economic considerations, it can be suggested that it is appropriate for us to limit our discussion to the economic advantages and disadvantages of the alternatives facing the investor.
George J. Staubus (Thu,) studied this question.