Accounting: The Basis for Business Decisions by Walter B. Meigs; Robert F. MeigsReview by: William F. ThomasThe Accounting Review, Vol. 61, No. 3 (Jul., 1986), p. 569Published by: American Accounting AssociationStable URL: http://www.jstor.org/stable/247183 .

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Book Reviews 569

perform and enthrall a non-midwestern audience, and having read this book, I have concluded that this "yarn spinner," also often appropriately called a modern day Mark Twain, has an ability that might be useful to accounting teachers, prac- titioners, and students. That is his uncanny ability to capture the essence of details and make them interesting and entertaining. Consider what the development of such an ability might do for the typical image/stereotype of accountants or for management's discussion and analysis: developing it into a report that is not only truthful but also understandable, interesting, and occasionally entertaining.

H.S.H.

WALTER B. MEIGS and ROBERT F. MEIGS, Accounting: The Basis for Business Deci- sions, Sixth Edition (New York: McGraw- Hill Book Co., 1984, pp. xxiii, 1104, $26.95).

Like its predecessors, this edition is for use in a two-semester introductory undergraduate accounting course. The primary emphasis is on financial accounting, with only six of 28 chap- ters devoted to managerial accounting topics. Although some material has been added and some has been rearranged, this edition retains virtually all the text and assignment material from the previous edition (reviewed January 1982, pp. 226-228).

Several changes deserve mention. Chapter 5, Accounting for Purchases and Sales of Merchan- dise, has been expanded to illustrate both multi- step and single-step income statements. Chapter 15, Partnerships, includes a brief discussion of the nature of limited partnerships. Recent changes in tax laws have been incorporated, including the Accelerated Cost Recovery System (Chapter 11, Plant and Equipment: Depreciation), indexing, the Economic Recovery Tax Act, changes in tax rates, and IRA and Keogh plans (Chapter 20, Income Taxes and Business Decisions). Chapter 28, Rele- vant Information, Incremental Analysis, and Capital Budgeting, has been restructured to emphasize the concept of relevant information. The concept is applied to various short-term decisions. Despite this restructuring, the problem material following Chapter 28 is virtually identical in conceptual coverage to the previous edition. This is true throughout the text, despite the authors' claim to have increased the number of problems and to have revised them.

Chapter 7, Accounting Systems: Manual and EDP, provides the only direct exposure to EDP systems. A discussion of basic computer topics (hardware, software, CPU, and others) has been

removed, so the focus now is on the use of com- puters. But this focus is limited to Chapter 7, since the authors fail to integrate the material into the remainder of the text.

The authors state that "Chapters 24 [Account- ing for Manufacturing Operations] and 25 [Cost Accounting Systems] have been carefully revised to illustrate more clearly the flow of product costs" (p. xx). A review of the chapters indicates that the changes to the text and illustrations are marginal, leaving the treatment of cost flows substantially unchanged.

Included in the comprehensive set of supple- mental materials is a computerized practice set. The practice set is a straightforward application for students with little or no computer experience. It requires a series of journal entries and provides help for students who enter errors.

The text, overall, is appropriate for the under- graduate introductory course. Its approach is most appropriate for accounting majors, primarily because of the completeness of coverage. The authors make some attempts to emphasize a more conceptual approach, as in Chapter 17, Corpora- tions: Operations, Earnings Per Share, and Divi- dends. This text may be most acceptable to the professor favoring a heavy emphasis on financial accounting.

WILLIAM F. THOMAS Assistant Professor of Accountancy

The George Washington University

LOREN A. NIKOLAI, JOHN D. BAZLEY, RICH- ARD G. SCHROEDER, and ISAAC N. REY- NOLDS, Intermediate Accounting, Third Edition (Boston: Kent Publishing Co., 1985, pp. xv, 1,344, $44.25).

This third edition, like the second (reviewed January 1984, pp. 149-150), is organized as a traditional intermediate accounting text. One improvement is the earlier coverage of the state- ment of changes in financial position.

The authors have done an excellent job of updating the material while retaining clarity of presentation and technical accuracy. The illustra- tions are well designed, many taken from published financial statements. Flowcharts are used liberally to clarify the more technical pronouncements. Those for earnings per share and asset exchanges are especially useful.

The text contains an adequate selection of cases, questions, exercises, and problems varying in degree of difficulty. Like most other intermediate texts, a complete set of support materials (trans- parencies, test bank, study guide, solutions man-

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