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PRINCIPLES AND METHODS
IN COMMERCIAL EDUCATION
•The
THE MACMILLAN COMPANY
NEW YORK • BOSTON • CHICAGO • DALLAS
ATLANTA ■ SAN FRANCISCO
MACMILLAN & CO., Limited
LONDON • BOMBAY • CALCUTTA
MELBOURNE
THE MACMILLAN CO. OF CANADA, Ltd.
TORONTO *
PRINCIPLES AND METHODS
IN COMMERCIAL EDUCATION
A TEXT-BOOK FOR TEACHERS, STUDENTS
AND BUSINESS MEN
BY
-Z 73(^7
JOSEPH KAHN, Ph.D., LL.B.
INSTRUCTOR, NEW YORK UNIVERSITY GRADUATE SCHOOL AND HIGH
SCHOOL OF COMMERCE; LECTURER ON PRINCIPLES AND METHODS
IN COMMERCIAL EDUCATION, EXTENSION DIVISION
COLLEGE OF THE CITY OF NEW YORK
AND
JOSEPH J. KLEIN, Ph.D., C.P.A.
PRESIDENT, NATIONAL BUSINESS INSTITUTE, -.LECTURER ON PRINCIPLES
AND METHODS IN COMMERCIAL EDUCATION, EXTENSION DIVI-
SION, COLLEGE OF THE CITY OF NEW YORK; AUTHOR
"ELEMENTS OF ACCOUNTING"
THE MACMILLAN COMPANY
1914
All rights reserved
Copyright, 1914,
By the MACMILLAN COMP^^^J.
Set up and electrotyped. Published October, 1914.
NnriDoolJ ^twa
J. S. Gushing Co. — ]5er\vick & Smith Co.
Norwood, Mass., U.S.A.
; / (^^
PREFACE
The occasion of the publication of a pioneer work on the
subject of Principles and Methods in Commercial Education
makes it appropriate to review the progress in the field of
education which has made this work necessary. The rapid
development of commercial education within the past fifteen
years, which has been marked by the establishment of sec-
ondary and higher schools of commerce, has not only enlarged
the concept of business education beyond the clerical aim of
the old-time business college, but has also given rise to the
need for properly trained teachers in commercial schools.
The demand is for teachers who, besides being masters of
their subject, are acquainted with the principles and methods
of their specialty and have the ability to apply these princi-
ples in the class-room. While facilities for training persons
for the higher branches of business have been established by
universities, and while the literature dealing with this phase
is considerable, it is strange that practically nothing has been
done thus far to give prospective teachers the pedagogical
foundation without which the mastery of the subject alone
is inadequate to fit them for the highest attainment in their
profession. The universities have sadly neglected the oppor-
tunity to offer normal training to commercial teachers, and
the lack of literature on methodology is a distinct reflection
of this neglect.
Within the past few years the demand for the close corre-
lation of theory and practice in commercial education has
given rise to experiments intended to bring the work of the
vi Preface
school in close relation to the business community. Accord-
ingly, in several localities cooperative and continuation plans
of apprenticeship have been established, the purpose of which
is either to give students laboratory work as apprentices while
they are studying, or else to give apprentices who are at work
the theoretical educational foundation necessary to lead them
to advancement in their vocation. The working out of this
plan of cooperation necessitates an understanding on the part
of the school authorities of the needs of business and, on the
other hand, a familiarity by the business man with the aim of
the work of the school. If the commercial world is to benefit
by the speciahzed training given in the school, the business
man must become better acquainted with the aim, the value,
and the methods employed in a business education.
This work, then, is intended to give the teacher in the
commercial school the broad vocational outlook upon his sub-
ject, to acquaint him with the pedagogical principles under-
lying it, and to discuss the special methods in the different
subjects included in the curriculum. To the business man
the book is intended to convey a knowledge of the value and
content of a business education, to give him a sympathetic
view of the work of the school, and a better understanding
of the needs of it, so as to enable him to cooperate with it in
a direction which will be of benefit both to the school and to
the community at large.
While several contributions have been made to the litera-
ture dealing with the content and history of commercial edu-
cation, notably by President Cheesman A. Herrick and by
President Edmund J James, there has been a strange neglect
of the pedagogy of the subject; and this in a field in which
the lack of trained teachers is probably greater than in any
other. The authors, therefore, feel that the publication of
this pioneer work on Principles and Methods in Commercial
Preface vii
Education meets a timely want, and that it will help to raise
the standard of the commercial teacher and give the business
man an appreciation of the value of a theoretical education
in correlation with practical work.
The authors have confined themselves largely to the con-
sideration of commercial education in secondary schools,
because in these pedagogic training is most urgent. As the
higher schools are of a professional or special character, and
as the students in these schools are older, the lack of good
method is not so disastrous as in the case of younger pupils.
Outline lessons and syllabi have been given in several in-
stances as illustrative of the application of the principles dis-
cussed, and particularly in subjects in which the text-book is
not a sufficient guide for the proper sequence of topics or for
the method of the recitation.
The authors beg to acknowledge their indebtedness to Dr.
John L. Tildsley, Principal of the New York High School of
Commerce, for permission to use his syllabi in Local Indus-
tries, Municipal Activities, and Economics. As far as we
know, Dr. Tildsley was the first teacher to develop a practical
syllabus in the former two subjects, and the first one to apply
the principle that the study of commercial geography should
begin with the industries of the immediate locality, and that
the study of civics should be made practical by including not
only the political, but the economic activities of the immediate
environment of the pupil. These syllabi were developed
by Dr. Tildsley while he was chairman of the Department
of Economics of the school, with some modifications by the
teachers of his department. On the practical value of alge-
bra in commercial arithmetic we desire to make recognition
of the work of Mr. W. S. Schlauch, of the High School of
Commerce, whose book on Commercial Algebra is in prepa-
ration.
viii Preface
Finally, it is the hope of the authors that this work will aid
university schools of pedagogy and normal schools to realize
the importance of devoting more attention to the training of
efficient teachers in the field of commercial education.
THE AUTHORS.
New York,
October 21, 1914.
TABLE OF CONTENTS
PART ONE
PRINCIPLES OF COMMERCIAL EDUCATION
CHAPTER I
THE ESSENTIALS AND VALUE OF A BUSINESS
EDUCATION
PAGE
Introduction — Content of a Business Education : Language ;
Mathematics : Commercial Arithmetic, Algebra, Plane
Geometry; Bookkeeping and Accounting; Business Prac-
tice and Office Routine; Stenography and Typewriting;
Science : Biology, Chemistry, Physics ; Technique of Com-
merce ; Economics ; Commercial Geography ; History ;
Civics ; Commercial Law ; Other Subjects — Disciplinary
Phase of Business Education : Intellectual Training : Ob-
servation, Judgment, Reasoning, Imagination ; ^Esthetic
Training ; Training of the Will — Summary — Exercises —
Bibliography 1-48
CHAPTER II
THE COURSE OF STUDY OF THE SECONDARY
COMMERCIAL SCHOOL
The Problem — Course of Study — Principles upon which Elec-
tives are offered — Explanatory Remarks on the Subjects
of the Course : English ; Foreign Languages ; Mathematics ;
Industrial Biology; Industrial Chemistry; Physics; His-
tory; Commercial Subjects; Industries and Commerce of
City ; Municipal Activities ; Commercial Geography ; Com-
mercial Arithmetic ; Business Technique ; Bookkeeping
and Office Practice ; Accounting ; Economics ; Technique
of Commerce and Industry ; Commercial Law ; Drawing
and Illustrating ; Stenography and Typewriting ; Practicum
— Summary — Exercises — Bibliography .... 49-^9
X Table of Contents
CHAPTER III
GENERAL PRINCIPLES OF METHOD
PAGE
Teaching of Commercial Subjects — Teacher's Knowledge of
the Subject — Principles of Teaching: Principle of Self-
Activity ; Interest and Purpose ; Apperception ; proceeding
from Concrete to Abstract and from Known to Unknown;
Drill and Principles of Habit Formation ; Formal Steps of
Recitation; Individual Instruction and its Limitations —
Summary — Exercises — Bibliography .... 70-90
PART TWO
SPECIAL METHODS IN COMMERCIAL
EDUCATION
CHAPTER IV
BUSINESS ARITHMETIC
Importance and Difficulties — Probable Causes of Failure : Ele-
mentary School Curriculum too Broad ; Lack of Practical
Work on Child's Level of Experience; Insufficient Drill —
Remedies : Limit Ground to be covered in School (Mc-
Murry's Rules for Elimination); Perfection in Skill —
Development of Arithmetical Skill : Transfer of Skill from
Drills to Practical Problems ; Interesting Drills ; Speed
and Accuracy ; Short Cuts — Artificial Aids to Calculation
— Application of Algebra to Arithmetic — Applied Busi-
ness Problems — Topics in Arithmetic : Percentage ; Profit
and Loss ; Commission ; Trade Discount ; Interest ; Bank
Discount ; Stocks and Bonds ; Partial Payments ; Com-
pound Interest; Taxes and Duties; Foreign Exchange —
The Course of Study — Special Methods: Subdivision of
Difficulties ; Blackboard ; Oral Work ; Diagrams ; Text-
book ; Teacher's Notebook; Examinations — Model Les-
son: Interest — Summary — Exercises — Bibliography . 91-128
Table oj Contents xi
CHAPTER V
OFFICE PRACTICE AND ROUTINE
PAGE
Pedagogical Basis — Penmanship : Legibility and Speed ; Free-
arm Movement ; Training of Teacher ; Methods of Instruc-
tion — Business Forms : Reasons for Including during First
Year — Topics : Checks ; Notes and Drafts — " Budget "
or "Voucher" System of Bookkeeping — Office Routine:
Aim of Course — Topics — Filing Systems — Practice Office
— Summary — Exercises — Bibliography .... 129-150
CHAPTER VI
BOOKKEEPING
Pedagogical Basis — Place in Course — Literature — Aim of
Course — The Teacher — The Text-book — Model Lessons:
First Lesson in Bookkeeping ; Proprietor's Account ; Per-
sonal Accounts ; Trial Balances ; Journal ; Statements ;
Formulas ; Special Books ; Extra Columns ; Closing the
Books ; Drafts — Exercises in Constructive Imagination
— Special Devices — Bookkeeping Ethics — Notes on
Method : The Recitation ; Home Preparation ; Revievi^s and
Quizzes ; Examinations — Syllabus — Summary — Exercises
— Bibliography 151-200
CHAPTER VII
ACCOUNTING
Bookkeeping vs. Accounting — Capital and Income — Purpose
of Course — Model Lessons : Balance Sheet ; Single Entry;
Controlling Accounts ; Cost Accounts ; Installing Systems ;
Auditing — Summary — Exercises — Bibliography . . 201-226
CHAPTER VIII
COMMERCIAL GEOGRAPHY
Place in Curriculum — Teaching Difficulties — Local Geography
— Topics : Materials of Commerce ; Physiographic Condi-
xii Table of Contents
PAGE
tions influencing Commerce ; Human Factors in Commerce ;
General Geography — Selection of Material for Study:
Principles of Selection — Organization of Knowledge —
Aids : Text-book ; Reference Books ; Trips ; Museums ;
Pictures; Maps; Graphs — Methods: Heuristic; Inductive;
Type ; Deductive — Model Lessons : Cotton ; Analysis and
Interpretation of Statistics — Syllabus in Local Industries —
Summary — Exercises — Bibliography .... 227-270
CHAPTER IX
TECHNIQUE OF COMMERCE
Aim of Course — Distinguished from Commercial Geography —
Difficulties of Subject — Topics : Manufacturing ; Prep-
aration for Market ; Transportation ; Marketing Product ;
Exchange — Economic Activities of the Government — Syl-
labus in Municipal Activities — Summary — Exercises —
Bibliography ... 271-285
CHAPTER X
HISTORY OF COMMERCE
Taught by History Department — Historical Method — Aim of
the Course — Selection of Topics — Methods: Text-book;
Topical ; Source ; Combined — General Method in History
— Teaching Aids : Maps ; Trips ; Pictures ; Charts ; Note-
books ; Library — Summary — Exercises — Bibliography . 286-299
CHAPTER XI
COMMERCIAL LAW
Teaching Faults — Aim of Course: Utility; Culture; Discipline;
Correlation — Topics: Three-fold Division — Introductory
Subjects — Methods: General; Text-book Method; Case
Method — Teaching Aids — Reviews and Examinations —
Research — Teacher's Library — Model Lessons : Statute of
Frauds ; Real Property vs. Personal Property — Summary
— Exercises — Bibliography 300-343
Table of Contents xiii
CHAPTER XII
ECONOMICS
PAGE
Aim of Course — Difficulties — Topics — Methods : Type ; His-
torical ; Seminar — Drill — Graphs — Syllabus — Summary
— Exercises — Bibliography 344-364
CHAPTER XIII
BUSINESS ENGLISH
Importance — Spelling — Grammar and Rhetoric — Composition
Work — Aids in Composition — Letter Writing — Reports
— Advertisements — Correction of Students' Work — Sum-
mary — Exercises — Bibliography 365-383
CHAPTER XIV
STENOGRAPHY AND TYPEWRITING
Value of Stenography : Utility ; Discipline ; Correlation — Aim
of Course — Methods in Stenography — Faults : Suggestions
for Improvement — Methods in Typewriting — Summary —
Exercises — Bibliography 384-400
PART THREE
SPECIAL PROBLEMS IN COMMERCIAL EDUCATION
CHAPTER XV
THE PREPARATION AND EQUIPMENT OF THE
COMMERCIAL TEACHER
Need of Trained Teachers — Development of Commercial
Teaching — Teacher's Training: College Education; Cor-
respondence Instruction ; Practical Experience ; Mastery
of Many Subjects — Summary — Exercises — Bibliog-
raphy 401-415
xiv ■ Table oj Contents
CHAPTER XVI
RELATION OF THE SECONDARY SCHOOL TO
THE HIGH SCHOOL OF COMMERCE AND
TO THE BUSINESS COMMUNITY
PAGE
Articulation — Vocational vs. Prevocational Training — High
Schools and Universities — Relation of High School to
Business Community — Cooperation — Continuation Study
— The Fitchburg Plan — Summary — Exercises — Bibli-
ography 416-433
PRINCIPLES AND METHODS
IN COMMERCIAL EDUCATION
PRINCIPLES AND METHODS IN
COMMERCIAL EDUCATION
PART ONE
PRINCIPLES OF COMMERCIAL EDUCATION
CHAPTER I
2 7367
The Essentials and Value of a Business Education
introduction
The consideration of the subject of education for business
at once suggests an inquiry as to the why and the wherefore
of such education. For it is a view still held by many that
there is no necessity for vocational training for commercial
life in school, and that the proper way to learn business is to
do so by entering business and starting at the bottom.
They hold that a scholastic education beyond the elemen-
tary course unfits a man for participation in industrial life,
and they fortify their assertions by pointing to examples of
self-made men, — men of limited education or none at all.
An analysis of those examples will show that these self-
made men have succeeded not because of their lack of scholar-
ship, but because they made up for that lack by self-educa-
tion in the school of experience, — a course which developed
not only their practical qualities, but trained their power of
2 Principles and Methods in Commercial Education
observation, their judgment, their imagination, and their
reasoning powers. And though measured in terms of dollars
and cents these men were successful, yet, owing to their defi-
cient education, they still lack the capacity for the apprehen-
sion of those finer elements of Hf e which constitute the spiritual
inheritance of the race, and the appreciation of which makes
life richer and more significant.
However, confining our attention to the success which
these men have achieved in business without a scholastic
education, we may ask why others cannot do the same. Some
of the self-made men possessed that genius for business which
was able to triumph against obstacles by obtaining a practical
education by self-directed effort. Others of that class might
have been more successful if their practical native talent
had the benefit of educational stimulus and direction.
But at any rate, the education of the vast majority of men
must be directed by the school. It is the one man in a genera-
tion who, like Pascal, can discover by his unaided effort and
without suggestion from books, the theorems of Euclid. And
even the progress of such a man is greatly accelerated by the
direction of the master. The apprentice system in business
is rapidly yielding to special educational preparation, just as
the apprentice system in law and medicine has yielded to
university training. So we may expect that the higher prep-
aration for business will soon rise to the dignity of profes-
sional training.
After we have decided that education is not only a help, but
also a necessity to the business man, we still have to answer
the question what kind of education we shall give and what
elements we shall include in it. To do this we must consider
briefly some conceptions of the meaning of education, and try
to deduce from these the essentials of a business education.
Essentials and Value of Business Education 3
The aim of education is fundamentally a sociological one.
It is to prepare the individual to take his place in the civil-
ization in which he lives, and to participate in its activities.
The relations of man to his environment are many-sided,
including not only his relations to the world of nature about
him, but to society at large, to the state, and to the church.
Our systems of education aim to give the student the ability to
adjust himself to every phase of his environment, and this is
the meaning of Spencer's definition of education as the prep-
aration for complete living.
Now society is so constituted that every member of it,
after he has passed his formative period, takes up a certain
phase of its activity, which constitutes his vocation. One of
the important needs of the individual is therefore preparation
to perform his vocational tasks efficiently, because they
constitute the largest part of his work in Hfe. This prepara-
tion is sometimes left to the individual himself to get it by
chance, sometimes it is accomplished by placing him in his
industrial environment when he is still unfamiHar with it,
and helping him at first to master the difficulties as they come,
until he is able to help himself. The latter is the apprentice
system. But for the higher vocations, those which demand the
exercise of the highest powers of the mind, experience has shown
that preparation cannot be left to chance or to an apprentice
system, but that it requires an extended period of special
theoretical and practical education. The professions have
long been in this class, and now the necessity for such special
preparation for business has become more and more evident.
Thus we get the rationale of the special school of commerce.
But now arises another question. At what stage shall
specialization begin, to what degree shall it be carried, and
to what extent shall it include general education ? We realize
4 Principles and Methods in Commercial Education
of course that specialization cannot be commenced before a
general foundation has been laid. The elementary school
course is a minimum, and ought to be such for all persons of
whatever walk in life. For professional education a larger
foundation than this is necessary. And so the secondary
school course, and sometimes the college course, are necessary
to lay the broad basis for general culture requisite for the
success of the professional man.
Specialization for business ought to begin in the high school
period, because commerce does not require technical pro-
ficiency of such large extent as the professions, and because
the pursuit of general culture can conveniently go hand in
hand with the study of technical commercial subjects, with
decided benefit to the latter. For this reason, in considering
the subject of the essentials of a business education, we do so
on the presupposition that the student has an elementary
education and that the study of business subjects is to be a part
of the high school course. Higher and narrower specialization
is in place only in the university school of commerce, when the
student with the aid of his practical experience has decided
in what particular field or business he will make his object
of special endeavor to excel. This phase of commercial educa-
tion we will only notice incidentally to the main object of this
work, — the aims and methods of the commercial high school.
.V A few words will not be out of place in connection with the
reason why general culture ought to go hand in hand with
special commercial training. Life is many-sided, and business
is only one side of it. The man who finds himself in place
only in business is narrow and unappreciative of the larger
and spiritual phases of life. When he is away from his office
or retires from commercial activity, life becomes empty and
without significance to him. In other words, he has failed
Essentials and Value, of Business Education 5
to learn how to enjoy his leisure. A rounded education gives
the man a proper sense of proportion of the relative value of
things, and impresses him with the relation of his special
activity in life with that of society at large.
The elementary curriculum, even in its small way, opens
the mind of the individual to a many-sided view of the world.
The secondary school course makes this view more vivid and
unified. And in the specialized commercial course it singles
out certain parts of the picture for closer observation, while
the rest of it acts as a background to bring these parts out in
closer rehef.
We shall now consider what the subjects of the business
course ought to be, and how they can help to develop all the
faculties of man.
CONTENT OF A BUSINESS EDUCATION
I. LANGUAGE
We know that business involves the social activities of
man and his relation to other men. Such relation is expressed
through language. It becomes at once evident that the
mastery of the vehicle of expression becomes the most impor-
tant accomplishment of the business man, and, in fact, the
highest possession of all men. The requirements of clearness,
accuracy, and force are essential in business language, and the
school properly provides an important place in the curriculum
for it.
In view of the fact that commercial relations are conducted
on such a large scale and, to a great extent, at a distance,
language becomes particularly important as a written instru-
ment. Among the expressions of language which the student
must learn to make use of are letters and telegrams, abstracts
6 Principles and Methods in Commercial Education
and condensations, reports, and advertisements. There are
also those technical forms which are used in mercantile pro-
cedure, and which, because they facilitate the conduct of
business, have been adopted universally. Form, arrangement,
and technical expressions are of considerable importance, as
well as content. Acquaintance with model forms is therefore
prerequisite to the production of good forms.
The question whether the knowledge of a foreign language
is an essential of the education of a business man is not always
easy to answer. It depends upon local conditions and upon
the length of time that is devoted to its study. If the cur-
riculum does not allow three years' work in the language, it
had better not be taken up at all. It is well to provide in
the course for an alternative between commercial German and
commercial Spanish. If the student contemplates entering a
commercial house which is engaged in foreign trade, the utility
of the study will at once be apparent. And even if he has no
such present intention, he will be possessed of an additional
qualification which will enhance his chances of employment in
a branch of business, that contributes so largely to the total
volume of commerce.
Besides, the study of a foreign language is of general utility
in thus giving us a better understanding of the structure of
our own.
II. MATHEMATICS
{a) Commercial Arithmetic. — The classification of com-
mercial arithmetic under mathematics is only a matter of
convenience. Mathematics is the science of quantity, and
arithmetic is one of the subdivisions of it. But business
arithmetic is studied primarily not for the attainment of scien-
tific principles and method, but for its strictly utihtarian value.
Essentials and Value of Business Education 7
All business deals with wealth,, — its production, exchange,
and distribution. The art of measuring such wealth is there-
fore of prime importance for the prosecution of all enterprise.
It is an essential part of all business education to impart a
knowledge of how to measure value under the various condi-
tions in which it is found, and to give the abihty to do this
accurately and quickly. The intelhgent solution of practical
business problems is also very valuable in reenforcing the
student's knowledge of business processes. Thus, for ex-
ample, the problems in bank discount will throw Hght upon
banking procedure, and the problems in commission will help
to explain the relation between principal and agent. Not
that arithmetic is the main vehicle by which an understanding
of business processes is brought about, but it furnishes very
striking illustrations of the value of correlating arithmetic
with actual business practice, and vice versa.
(b) Algebra. — This important branch is the foundation of
mathematical reasoning, because it furnishes the language
which higher mathematics must make use of as its vehicle of
expression. From a scientific point of view arithmetic is
only a particular form of algebra. Now the justification for
including the subject in the commercial curriculum lies in
more than its value as a means of mental training. It has a
distinct utilitarian value. Algebra furnishes a beautiful and
concise method of expressing symbohcally a quantitative
process in a formula which comprehends all possible particular
manifestations of that process. The use of formulas is an
important aid to the understanding of accounting, of chem-
istry, and of physics. And besides, algebra furnishes such
easy and clear methods of solving practical problems that are
difficult or impossible of solution by arithmetic, that on the
whole we are not only justified in including it in the cur-
8 Principles and Methods in Commercial Education
riculum, but impelled to do so by the strongest practical
arguments.
(c) Plane Geometry. — It is with some misgiving that we
include geometry in the course; for it has practically no utili-
tarian value for the business man. If it were a question be-
tween geometry and a foreign language, we would certainly
prefer the latter. As it is, geometry is made elective with
stenography.
Of course it is true that geometry teaches us the properties
of space. But then it shows not only what they are, but why
they must necessarily be so. The extensive use of deductive
reasoning is valuable as training in logical thinking. This is
the main justification for making geometry a part of the
curriculum. As to the properties of space, we get these in the
geometric formulas we employ in industrial arithmetic, al-
though the strict scientific explanation of them is only ob-
tained by the study of synthetic geometry. It may be added,
also, that geometry is the subject par excellence in the second-
ary curriculum, which demands strict and concise definition,
close deduction from premises, and clear scientific expression.
The elimination of the subject might therefore prove an un-
replaceable loss.
III. BOOKKEEPING AND ACCOUNTING
One of the greatest inventions of the human race has
been the means of fixing facts and events after they have
passed from our view. Writing performs this function.
But the pioneers of commerce discovered a more concise
and systematic method of preserving a record of business
than the narrative form. Thus bookkeeping originated, and
while its fundamental basis has remained the same, the
science of accounts and the complex requirements of modem
Essentials and Valtie of Business Education g
commerce have devised improvements in comprehensiveness
and detail.
The study of bookkeeping performs the important function
of teaching the student how to keep that systematic record of
the business, which is so essential to its success. And even
if his future work should consist in managing instead of re-
cording business, the study will give him the ability to judge
whether the work of his bookkeeper is being performed effi-
ciently and honestly. The two things he should be able to
find out about, — and they are the two aims of bookkeeping,
— are, (i) How does the business stand ? and (2) What prog-
ress has it made since the last period of inspection?
The ordinary routine bookkeeper perhaps does not realize
the great possibilities of his work. It is the accountant who
has opened the eyes of the business world to the possibilities
of a set of accounts in telling the story of success or failure,
and in suggesting improvements and economies.
This stimulation of the imagination and awakening of the
reason by means of the subject make the elementary study of
the science of accounting a necessity even in a secondary
school. The relation between the bookkeeper and the ac-
countant is the same as that between the mechanic and the
engineer. The former does the task allotted to him, and
generally does it well, but his activities have to be directed.
He moves in the same groove, and there is no originality in
him. The accountant, on the other hand, corresponds to
the engineer, — the mind that plans and directs.
We want our bookkeepers to have some of that engineering
spirit, — that initiative which lifts them above the dull dead
routine; just as we desire our mechanics to improve them-
selves by becoming acquainted with some of the theories of
their craft.
10 Principles and Methods in Commercial Education
Such theoretical study is not recommended because it will
dispense with the accountant. On the contrary, it will render
the work of the accountant more important and more produc-
tive to the business, by enabling him to devote his attention to
the larger phases of business, because he will have an intelli-
gent and efficient instrument in the bookkeeper to help carry
out his instructions.
But the good bookkeeper is not prepared for his task by
merely knowing arithmetic and bookkeeping. These are
only the formal aspects of business. He must understand
business itself, — methods of producing, of distributing, etc.
In regarding bookkeeping, we may see the twofold mistake
which our system of commercial education generally commits.
It is apt to make a sharp distinction between the preparation
for carrying on business and the preparation for recording
business itself, and as it does not see its way clear how to pre-
pare for the former, it has left this phase to the student him-
self to learn it in contact with practical business. The work
of the ordinary business school is mainly a preparation for
keeping a record of business.
Now the mistake in making this separation between the
carrying on of business and the keeping of a record of business
has resulted in the establishment of a caste system. On the
one hand no bookkeeper can be more than a mere clerk unless
he learns about the nature of business and the processes in-
volved in it. On the other hand, in establishing a caste of
clerks the system has lost sight of the importance of book-
keeping to the man who is going to carry on the business,
even though he is not going to keep books himself.
No man can have a grasp of the business, — no man can
keep a check on the work of his subordinates, unless he can
inspect the work of his bookkeeper, understand what he is
Essentials and Value of Business Education ii
doing, and interpret the progress of the business from such
inspection. Such knowledge will also make him more ap-
preciative of that phase of the business, and of the work of
the accountant.
It is true that some distinction will be made in the educa-
tion between the man who is preparing for business generally,
and one who is preparing for accounting in particular. But
this distinction will be in the direction of greater specializa-
tion by the latter.
IV. BUSINESS PRACTICE AND OFFICE ROUTINE
This course is a necessary introduction to the study of
bookkeeping. It includes in the first place the understanding
of the function of the technical business forms such as receipts,
orders, bills, statements of account, checks, drafts, notes,
etc., the use of which makes the conduct of business orderly,
and the keeping track of original records easy. This under-
standing should also include the ability of the student to draw
up these forms from data furnished him.
As in actual business he will have to draw these up for
preservation as original records ; it is important that he write
them in a legible and neat hand. Training in penmanship is
therefore provided for in the commercial course as a pre-
liminary to this work.
The work in office routine ought to familiarize the student
with such factors as the preparation of the letter for mailing,
postal laws and regulations, the use of the copying press, and
filing systems.
V. STENOGRAPHY AND TYPEWRITING
In the course of the conduct of business, correspondence
plays an important part. A great deal of its success is de-
12 Principles and Methods in Commercial Education
pendent upon the efficient, accurate, and neat manner in which
the correspondence is conducted. The complexity of the
volume of business transacted has made increasing demands
upon the manager's time in connection with the disposal of
the correspondence. Even with the assistance of clerks this
part of the work would prove a great tax upon the time and
energy of the head, were it not for the fact that by the various
systems of shorthand the clerks are able to take down the
words of the superior at about the speed of ordinary con-
versation. In modern business the stenographer has become
indispensable, and in view of the great demand, training
for stenography has become perhaps the most important
object of the ordinary commercial school.
The question now arises, Is a knowledge of stenography
essential to a business education? It is for the one who is
going to become a stenographer and correspondent. For
the person who does not intend to practise this branch,
whose work will consist in conducting rather than recording
business, the study of stenography will be of relatively
little utility. We must of course consider that it gives a
valuable training in language, and is of some value in train-
ing the powers of observation and judgment, in training the
ear, and developing the power of concentration, but on the
whole, these are only incidental to the main purpose of the
study, — the acquirement of technical proficiency. Even
after the accomplishment of the object, this proficiency can
be retained only by continual practice. If the student is
not going to keep up the practice in business, he will lose that
proficiency, the chief element of which is speed, and the many
hours which he has devoted to the subject will have been
largely wasted. The mental growth and stimulus which
he has obtained from the study may remain with him, it is
Essentials and Value of Business Education 13
true, but it will be slight compensation for the time and
energy spent on the study, as compared with the fruits to
be obtained by devoting the same period and effort to an-
other subject.
Now it may be pertinent to inquire why the stenographer
should receive a general business education at all, instead
of being taught his specialty alone, together with a few other
subjects like English, that are closely connected with it.
The reason is that commercial life is in need of intelligent
high-grade stenographers who shall be more than writing
machines. The busy man must rely upon his stenographer
to take some of the burden of routine correspondence from
his shoulders. The employee must be competent to compose
a letter from the brief directions given to him by his busy
employer. This he can do only if he is competent to take
an intelligent interest in the work of the firm. And who
knows but the stenographer's position may be a stepping
stone to work of greater responsibility and opportunity, to
which his previous good training in school will be a decided
help?
What has been said about making stenography an elec-
tive, also applies to typewriting, which is, of course, purely
a mechanical subject. It is an accomplishment indispen-
sable to the stenographer. Its use in business has been a
great boon in saving time, promoting order and neatness,
and avoiding misunderstandings. Nevertheless, it be-
longs to the specialized business course, and not to the gen-
eral course. But it must be admitted that there are grounds
for the support of the contention that a knowledge of type-
writing is of general utility, especially in view of the large
use to which the typewriter is put in private work outside
of business.
14 Principles and Methods in Commercial Education
VI. SCIENCE
We have now considered that one aspect of business that
deals with the office where commerce is planned and re-
corded. But after all, this is only one aspect, although an
important one, of the world's industry, which deals with the
production, exchange, and distribution of goods. This
world of industry is a large one, and to be master of it in all
its details is not even remotely within the capacity of any
single mind. Each industry is specialized, and the attain-
ment of skill in each is a matter of special education. But
there is one point in which commerce appertains to them all :
the products, in order to be of utility, must be distributed in
accordance with certain economic needs - — and those needs
will in turn determine forms of production. Hence, to a
large extent, the requirements of commerce will regulate all
industry in the world. And therefore, while the acquirement
of the technique of a trade or industry is obviously not
within the scope of a school of commerce, the question of
management, supervision of the industry to the most eco-
nomic advantage, and the technique of distribution of its
production will still be a most important aspect of the com-
mercial curriculum. Necessarily some knowledge of the
technique of the leading industries, even though very super-
ficial, will be of decided advantage in considering commercial
problems.
We therefore provide the student with the means of becom-
ing acquainted with the materials of commerce and processes,
both of nature and man, involved in their production. To
understand the variety and diversification of industry in the
interrelation of the factors involved in it, it is necessary to
study it from some principle of unity. This is furnished by
Essentials and Value of Business Education 15
the study of science. Now the economic needs of man are
satisfied first by materials and functions in the organic world,
and secondly by those of the inorganic world. The former
include the animal and vegetable kingdom, a study of which
is undertaken by biology ; the latter, involving the study of
matter and the changes taking place in it, lead to the study of
chemistry and physics.
There are three sciences, then, which disclose to man the
nature of the physical environment about him, and the means
of utilizing it to his own advantage. These are biology,
chemistry, and physics. In this order we will include them
in the commercial curriculum. Each one of the sciences will be
studied with special reference to those materials and functions
which man has made use of for industrial and commercial
purposes. But necessarily, before industrial application can
be properly understood, the underlying principles upon which
these depend must be mastered. A careful theoretic founda-
tion will therefore have to be laid in each science, without
which the student will lack principles of interpretation to
guide him in studying the phenomena of the science, upon
which the industrial arts depend.
We will briefly trace the commercial value of each one of
the sciences enumerated, omitting for the present their dis-
ciplinary value.
(a) Biology. — Our study of biology reveals to us the
sources from which man satisfies the three primary needs of
man, — food, clothing, and shelter. The study of the food-
supply is therefore a prominent part of the biologic curriculum,
together with the study of the two great materials from which
we secure our raiment, — cotton and wool.
Altogether we may say that the course of industrial biology
ought to be practically a course in elementary scientific agri-
1 6 Principles and Methods in Commercial Education
culture. The relation of the latter to commerce is growing
of greater importance every day. The changes taking place
in farming methods to-day are analogous to those which
occurred over a century ago in the mechanical industries,
when the introduction of machinery so changed methods of
production as to effect an economic revolution. Scientific
and commercial methods are similarly transforming the work
of the farmer in making the land more productive and the
distribution of the product more economical. With the estab-
lishment of the United States Department of Agriculture, the
various state departments, and agricultural experiment sta-
tions, the introduction of cooperation in marketing the prod-
uct, the growth of the large produce commission houses, a
new era has come in agriculture. The latter has become a
complex study, having as its constituents not only biology,
but also chemistry and physics. The biologic element, which
of course predominates, includes the study of commercial
plants, their cultivation and harvesting, the diseases to which
they are liable, and their preventives. The study of domestic
animals, their products, and preparation for the market would
be included in the course. The chemistry of agriculture
which perhaps might be studied in the course on industrial
chemistry, would include the study of the soil and its fertiliza-
tion, — the problem of letting the food-supply keep pace
with the increase of the population, and how chemistry is
solving it. Of course the study of biology would include the
subject of the cultivation of the other crops of commerce, which
serve to provide clothing and other comforts, as well as food.
(6) Chemistry. — The course in industrial chemistry would
follow that in biology. It would reveal to the student the
changes which take place in the constitution of matter, and
how man takes advantage of these changes for industrial pur-
Essentials and Value of Business Education 17
poses. The chemistry of the soil was referred to before as
one of the important topics, as of course is the chemistry of
food, its constituents, its preservation, and adulteration. In
the study of the metals our eyes are opened to a wide indus-
trial field. Practically all of them are found in a state of
impurity and have to be reduced so as to be made available
for use of the arts. Then there is the chemistry of carbon,
which discloses to our view the nature of the product, coal,
which makes the wheels of industry go round. It also includes
the study of illuminating gas. In the course we will also have
petroleum and its by-products, in which the scientist is still
finding greater treasures every day. The chemistry of the
dyestuffs also has developed a great industry, especially in
Germany. One of the reasons for the commercial supremacy
to wliich Germany is fast attaining, is the fact that its indus-
trial leaders appreciate the importance of the scientific man
in helping to realize industrial possibilities. We find an il-
lustration of this in the fact that great manufacturing firms
find that it pays to employ men solely for the purpose of con-
ducting research work.
If the study of chemistry by the American student will
have no other result than a realization on his part of the close
relation between theory and practice, between science and
industry, the time spent on it will have been entirely worth
while.
(c) Physics. — Physics, while not so important as chemistry
to the commercial student, must nevertheless occupy a place
in the curriculum, apart again from its disciplinary value.
Steam and electricity have brought about the modern era of
industry. The study of the means by which man harnesses
the wild forces of nature, — the water wheel, the steam engine,
and the application of electricity, — these are all of the utmost
1 8 Principles and Methods in Commercial Education
value to the business man. It is hardly necessary to go into
further details on this subject, as the importance of the study
is too obvious.
VII. TECHNIQUE OF COMMERCE
The sciences which we have reviewed show us how man
makes use of the materials and forces of nature in producing
an ever increasing complexity of new forms. But there is
another element which must enter into the study of these
forms. What is the purpose of production? Is it to serve
the needs of the producer alone or those of others as well?
Obviously the latter, because the producer has only a need
for a small part of his product, and with the surplus he may
obtain in exchange the product which he needs of the industry
of others. Thus commerce arises, together with the particu-
lar technique which it develops. And so we place as a sep-
arate subject in the curriculum the technique of commerce, —
a study of those conditions and arrangements which facilitate
the exchange or transfer of goods.
In this course we will consider the various forms of the
organization of industry, — the single entrepreneur, the part-
nership, the corporation, the trust, the specialization of in-
dustry, and division of labor. The preparation for the market
— the methods of packing and shipping — is next in the
course, followed by a detailed study of transportation on land
and water. Special methods of marketing in connection with
certain industries ought to be taken up: for example, the
elevator system and the produce commission house. Among
other topics would be the technique of selling, — the whole-
saler, the retailer, the mail order business, and methods of
advertising and the principles of salesmanship.
Money and credit deserve special study because they are
Essentials and Value of Business Education 19
the means which make modern commerce on a large scale
possible. The various institutions of credit, — the bank, the
clearing house, and the exchanges ; the instruments of credit,
— checks, bills of exchange, notes, bills of lading, and ware-
house receipts : the study of the function of all of these ought to
be included in the course. Among other aspects of the subject
are the technique of international trade and the modern
mercantile information system.
VIII. ECONOMICS
The objection may be interposed that many of the topics
in the foregoing course ought to be taken up in the course on
economics. We may discuss here the position that the latter
should occupy in the curriculum. Economics is the philosophy
of business. It gives us a unity of view of the world of indus-
try and commerce by determining the proper sphere of each
industrial activity in its relation to others, and establishes the
true basis upon which growth and progress in business depend.
It is primarily abstract, although its truths are applied to
concrete facts. Therefore pedagogically it marks the con-
clusion of the business course, being given at a time when the
student has a sufficient mass of data derived during the previ-
ous years of study, from which to generalize. Now it will take
all the time of the teacher — if the subject is properly taught,
with all the scope given to discussion by the student — to
impress upon the mind of the latter the principles of the
science and their applicability to the industrial world. De-
tails of the application of economic principles in actual busi-
ness ought to be taken up in a separate course, where they
can be considered concretely. This is provided in the course
on the technique of commerce. The study of money and
20 Principles and Methods in Commercial Education
credit should be so arranged as to be concurrent with the work
in economics.
The regular course in economics ought to be supplemented
by a study of corporate and public finance. The latter can
be more efficiently studied in this connection than in the
work in civics.
IX. COMMERCIAL GEOGRAPHY
Another subject essential to education for commerce is
commercial geography. This subject gives us a view of the
influence of geographic conditions like climate, topography,
and location upon the industries and commerce of a country.
It also treats of the resources of the commercial countries of
the globe, their trade relations with each other, their means
of communication, and their trade opportunities and rivalries.
The course will also include a review of the materials of com-
merce.
Naturally the study will be taken up with the commercial
possibihties of the locaHty, the state, and the United States.
The study of the countries of the globe will be principally with
reference to their relation with our own. The commerce of
both the United States and the locaHty will also be considered
in connection with problems of its expansion, the study of
competition we have to meet, and means of meeting it. We
will consider the entire subject in detail in a later chapter.
X. HISTORY
The study of the geography and the technique of commerce
bring closer to mind the influence of human institutions in
changing the face of the environment. This influence has not
made itself felt immediately, because it has itself been in the
process of evolution. Man's mastery over his environment is
Essentials and Value of Business Education 21
not a sudden outcrop. To understand it we must study the
progress of this struggle as recorded in history. It is hopeless
to attempt to understand the complex organization of the world
into those institutions which contribute to its forms and
stability, — society and the state, — without a record of their
gradual development from simple forms.
History, then, is not only of supreme culture value in giving
us a realization of the meaning of civilization by disclosing
to us the sources and the development of our race-inheritance,
but it is of great utilitarian value. It contains the laboratory
in which social, political, and economic experiments on a large
scale have been conducted in the past, and the successes and
failures of these form most valuable object lessons for us.
The course in a commercial school ought to lay particular
stress on the industrial and social phases of history, although
the political phase and the history of culture ought to receive
their due share of attention. It is a question whether the
history of commerce ought to be studied apart from general
history. In the high school course it is probably not advisable
to do so. The principal reason why the separate study of the
history of commerce has been favored by some teachers is
that the ordinary historical text-book contains so much of
the story of war and dynasty, — with some recognition, it is
true, of political and constitutional history, — that the eco-
nomic and social elements have generally been left to appen-
dixes. An attempt will be made in a succeeding chapter to
show how the course in industrial history may be made the
centre from which the survey of the entire subject may be
taken. For the present we will just note one important fact
that ought to be kept in the foreground : that is the emphasis
upon the element of growth and development. The chrono-
logical method fails entirely to give the student a grasp
22 Principles and Methods in Commercial Education
of this. We want to appeal to the student's imagination,
not to his memory. Historical maps visualize the territorial
growth of the country. Other means, such as charts, tables,
historical exhibits, etc., ought to be employed to visualize
its economic development.
XI. CIVICS
The study of history should culminate with the history of
our own country, and the study of its government. Every
person should have a clear knowledge of the nature and func-
tions of the state, and the duty which he owes to it. This
conception of civic duty was especially strong in ancient
Greece and Rome, where the good citizen and the good man
were used as synonymous terms.
In the commercial curriculum outlined in the next chapter,
the study in civics is begun by a course in municipal activities
or local government. We begin this way, because it is the
most concrete way of giving the student an idea of civic duty.
For it is the local government with which the individual comes
in most immediate contact, and in relation to which he can
discharge certain duties, even at a youthful age, before he has
the right of franchise. The intelligent exercise of the latter
by no means discharges the obligation of the citizen to the state.
If it did, women would have no obligation. There are many
duties, both positive and negative, which a person owes to
the government under which he lives. A clear realization of
these ought to be impressed in the school as a preparation for
civic righteousness.
XII. COMMERCIAL LAW
Civics has shown us the forms and institutions which
the state has adopted for the best interests of its citizens,
Essentials and Value of Business Education 23
and pointed out the paths in which our duty to the state
lies.
The state has provided a system of laws for the protection
of life and property. It has also laid down, to a large extent,
the laws governing the relations of men to each other. With
the growth of modern commerce and industry these relations
have become more and more complex; and it is not to be
wondered at that a conflict of motives between individuals
should arise, and that their interests should sometimes clash.
The state of course provides the means of peaceably settling
these quarrels. But, as Polonius says, " Beware of entrance
to a quarrel, but being in, bear that the opposer may beware
of thee." An acquaintance with law will enable a person so
to safeguard his interests, as to avoid expensive litigation.
And if he is forced into it, he will know that he is in an in-
trenched position and that the opposer will have to beware of
him. Commercial law, then, is to be included in the curriculum
not because its study will help the business man to dispense
with the lawyer, but because it will help him to protect him-
self when legal advice is not readily at hand, or when the un-
learned in law would not think legal precautions were at all
necessary.
XIII. OTHER SUBJECTS
Literature, drawing, music, and physical training and
hygiene are all essential parts of the curriculum, but most of
them will be treated below in connection with the discussion
of the disciplinary phases of the subjects of the course of study.
We will discuss here only the subject of physical training and
hygiene.
The Greeks appreciated much more than we do the impor-
tance of the training of the body. But their motive was mill-
24 Principles and Methods in Commercial Education
tary, athletic, and aesthetic, while ours is hygienic. We want
our students to train their bodies because in doing so they will
preserve their health and strength. Commercial pursuits
are generally of a character not calling upon the exercise of
the muscle. They are a constant tax upon the brain and
nerves. Unless the worker has opportunities for relaxation,
he will find that the work is a strain on his nerves, — that it
makes him irritable and nervous, and that both his health and
his business suffer; the latter from his inability to give the
full measure of his normal mental power to it.
Now physical exercise is the proper relaxation that such
a man needs. His work in physical training and hygiene in
school should result in giving him a love of sport and healthy
exercise, and the ability to take care of his body so as to pre-
serve his health. The prolongation of life and the prevention
of disease have of course their economic side. Ill-health,
which prevents a man from doing his share in society, is a
drain upon the resources of the community. Anything which
prolongs the efficient period of a man's activity is the source
of so much increase of the wealth and prosperity of the world.
DISCIPLINARY PHASE OF BUSINESS EDUCATION
Having considered the subjects which will have to be in-
cluded in the commercial curriculum because they are the
windows through which the individual will have to look at
the world in general and at the industrial field in particular,
we now have to regard the particular effect which these
studies are expected to produce on the individual who is en-
gaged in them, — and on the qualities which they are ex-
pected to develop in him.
We mention this subject, in spite of the fact that in certain
pedagogic circles the reference to the general or formal dis-
Essentials and Value of Business Education 25
ciplinary value of any subject is extremely unpopular. There
is a widespread belief to-day that the training obtained from
any subject will be manifested only in relation to that sub-
ject, and will not be transferable to any other subject. But
the truth of this in its extreme form is very doubtful. There
are many who still believe in the general disciplinary value
of a classical education. Granting that there is some truth
stiU left in the doctrine of general mental discipline, we desire
to show that there is just as much mental discipline to be ob-
tained from the business course as from the general academic
course. On the other hand, even if the doctrine of formal
discipline should be rejected entirely, it still remains true that
the development of power in a subject, rather than the im-
parting of a mass of information, should be the aim of the
teacher. Education as training and development, rather than
cramming and stuffing, should be his ideal. What phases of
the mind the teacher is to train, and how the content of
the curriculum will aid him, we shall now consider.
I. Intellectual Training. — The use of this term does not
necessarily involve the idea of training for scholarship. It
has reference to the idea of the development in school of
powers which are psychologically referred to as intellectual, — •
the power of observation, the judgment, the imagination, and
the reason.
We may at first wonder why training of the memory is not
included in the list. This is because the training of the mem-
ory is not an end in itself, and if made so it is apt to cause
arrested development of the higher faculties. We do not want
the student to carry a burden of facts, because he is liable to
do so at the expense of the reason and as an excuse for not
thinking. For the larger facts of life when grasped by the
reason are remembered without any effort, and the smaller
26 Principles and Methods in Commercial Education
facts rationally connected with them can be deduced from them
by the mind, — again without the effort of the memory.
Other facts are remembered only to the extent to which we
know where to find them, when we need them. Such are
the facts in the almanacs, individual items in our account
books, etc. It is sometimes a disadvantage to a man in busi-
ness to have a memory for individual isolated facts, because
he is liable to get into the habit of relying upon his memory
instead of writing them down. In this way he will tend to
become unsystematic in his business habits, — a condition
which will seriously interfere with the progress of his business.
It is needless to refer to the importance that a complete record
of things is in business.
It must not be assumed from the above that we are trying to
disparage the importance of the memory, but only when its
use tends to a disuse of the higher powers of the mind. It is
of very great value to a person to be able to grasp facts in
their relation to other facts in a group, to remember them as
parts of one system of experience. Facts of that sort are
remembered because they have been thoroughly assimilated ;
and the vehicle of this assimilation have been the higher
intellectual functions of observation and judgment. The
training, then, of the other powers will indirectly help the
memory and make the special training of the latter unneces-
sary.
(a) Observation. — The difference between ordinary per-
ception and observation may be illustrated by the following
examples from bookkeeping. The layman looks at a set of
books and sees only names and figures. He only perceives.
But the bookkeeper looks at the same, and with the aid of his
imagination the entire combination of the business is revealed
to him. He observes. Observation is, therefore, active
Essentials and Value of Business Education 27
seeing, and involves the concentration of attention to the
discernment of a novel element in what appears to be familiar,
and a familiar element in what appears to be novel.
The keen eye for details, the power to note variations and
difference where the untrained eye would assume sameness,
— all this is of course a desideratum of the business man.
Each vocation develops in the individual certain powers to
discriminate, — powers that tend to become sharper as spe-
cialization proceeds. In training for the vocation of business
we aim to develop the power of observation, so that the student
will become quick and alert in seizing details which come under
his eye, — details that otherwise would escape him. We
accomplish this object by encouraging the habit and strength-
ening the power of attention. Lack of concentration is the
primary cause of failure to observe. The poor observer's
attention is scattered so that all the facts in his immediate
surroundings appear in the same degree of intensity or lack
of it. Now the good observer focuses his attention upon a
particular part of the picture before him, and for the moment
shuts out from his view the other parts of the picture, or rather,
places them in the margin of his consciousness. This con-
centration enables the observer to discern the nature of the
object before him, and assign it to its proper place in the gen-
eral view of his experience.
This power of the mind which we have been discussing is
also exercised, though not so frequently, in finding similari-
ties between objects that are apparently dissimilar. The
finding of resemblances is a very important aid to reasoning.
Thus the student of economics who observes that a certain
present situation resembles one in the past, has a basis for
predicting, by analogy, the consequences of that first situa-
tion. While observation is primarily analytic, discerning
28 Principles and Methods in Commercial Education
variety and distinction where perception only sees sameness,
its activity must be supplemented by synthesis in order that
the results of observation may be of practical value ; that is,
the fact observed must be related to the rest of experience in
order that its larger meaning may be grasped.
The exercise of the power of observation in school is best
stimulated by questions. To the keen mind every slight de-
parture from routine suggests a question which arrests the
observer's attention until it is answered. In school this
question must usually be directed by the teacher, and the
student's attention aroused to the observation of differences
and similarities.
As to the school subjects which train the power of observa-
tion, we will note only a few that do so in a high degree.
First, of course, come the inductive sciences, through which
the student learns to observe the phenomena about him either
in the form in which they appear naturally, or under condi-
tions introduced by experiment.
Business practice and routine requires the guiding stimulus
of observation to keep one from getting into a rut. The
constant exercise of observation on the student's part is
necessary to learn the forms and procedure in business, until
they are no longer new, but a part of habit. At this stage
there is danger that the mind will sink into a kind of lethargy,
because it lacks the stimulus of an obstacle to be overcome, of
a difficulty to be mastered. The exercise of attention and
observation keeps the mind constantly on the alert for new
situations and departures, amid the apparent sameness of
routine.
In commercial geography there is a continual appeal to
the mind to observe similarities and differences between facts,
so that the latter should not remain in the mind in isolation,
Essentials and Value of Business Education 29
but as parts of a connected and orderly experience. Take a
table, for example, giving the values of the different exports
and imports of the United States. As isolated facts these
values mean very little, but in their relation to each other,
they furnish data from which to draw inferences regarding the
general state of commerce in the country. Charts and statis-
tical curves aid the student to observe these relations in their
totality.
Commercial law affords excellent examples in the use of
observation. Each case always involves a salient point upon
which the decision must depend, and which the student must
disengage from its non-essential surroundings. Or sometimes
a case will come up, which a superficial consideration will
decide in accordance with certain principles, while a careful
scrutiny will disclose a point which changes the entire aspect
of the situation.
(&) Judgment. — What do we understand by the training
of the judgment? Popularly we know what good judgment
means, but if we were asked to give an explanation of it we
would find difficulty. And yet a clear, thoughtful, psychologi-
cal analysis of judgment will prove of great assistance in under-
standing that function and in appreciating the relation be-
tween education and practical life.
By judgment in the largest sense of the word we mean, to
use technical phraseology, the ability to see the particular
in the light of the universal ; or more popularly, to under-
stand how to apply rules to particular facts and situations.
Let us analyze this further. We learn laws and rules not as
ends in themselves but as means with which to interpret facts.
The ability to interpret facts by means of the proper rules
constitutes judgment.
This difficulty presents itself in the exercise of judgment.
30 Principles and Methods in Commercial Education
When we see a particular situation to which we have to adjust
ourselves, we are sometimes at a loss to know what rules of
our past experience we shall draw upon in order to accomplish
our purpose. The man of judgment sees the situation and
immediately, as we say, "sizes it up," a very expressive term
which means that he interprets it in accordance with his past
experience, and in the light of it adjusts himself to that situa-
tion.
This ability some individuals possess in such a marked
degree that we sometimes say it is born with them. Now
while this power is at the basis of genius and talent, it is not
entirely native, but acquired by constant practice. No amount
of general knowledge is of any value to us unless it will help
us to perform a better adjustment to the environment. It
must not only help us, but we must know how to help our-
selves with the aid of it. That is the reason why in the school,
practice, example, and drill are such an essential part. By
their means the student learns how to recognize facts, how to
do things, how to apply principles ; in short, how to use his
judgment.
Sometimes no amount of such training will avail to give a
man the proper judgment. He may be full of knowledge and
yet a fool when it comes to doing things. We find examples
of that kind in many professions : the teacher who knows a
great deal of pedagogy but who cannot teach, the lawyer who
is learned in the law but fails to advise his client correctly,
the bookkeeper who knows the theory of accounts but who
cannot feel the pulse of the business and make a prpper an-
alysis of its condition. The trouble with these men is that
they lack judgment. Somewhere in the recess of their mind
there is the proper remedy for the situation, but it is mingled
with so many other remedies, that they do not know which
Essentials and Value of Business Education 31
one will lit in the particular case before them. They either
choose the wrong ones or remain inactive, and turn out to be
failures in their profession, while the man of less learning may
become a brilliant success.
What is the reason for the failure of the former? There
are two causes : One that their education has been too theo-
retical and they have been given too little opportunity to apply
what they know to practical conditions. The other reason
is a temperamental one, — a lack of native ability ; and for
this there is unfortunately no remedy. A person who suffers
from this lack has chosen a vocation for which he is not fitted,
and no amount of training can supply this constitutional
deficiency.
This should not make us jump to the conclusion that an
elaborate education as a preparation for business is futile,
as far as training for practical work is concerned. Of course
it is understood that no amount of commercial education will
dispense with the necessity of actual experience in business
to produce an efficient business man, just as no amount of
medical education will dispense with the necessity of clinical
experience to make a good physician. But the man who has
had the thorough grounding in school approaches the problems
with a different mind from the one who has not had it. He
recognizes situations not as isolated phenomena but as ex-
emplifications of laws and economic forces operating. He
can therefore grasp the situation in its large significance and
in its general relation to the rest of his affairs.
To study in detail how the subjects of the commercial cur-
riculum train the judgment is, quantitatively, a large task.
Every subject requires the student to make concrete applica-
tion of the principles he has studied, to particular cases, —
and to that extent it exercises the judgment. The only reason
32 Principles and Methods in Commercial Education
why, in spite of so much opportunity to exercise the judgment,
many students who leave school are still deficient in the latter
is that the situations which confront them in actual experience,
are the results of complex forces working to produce them, and
they can be faced successfully only with this many-sided view
of their cause. In school, on the other hand, situations are
presented, with many of the extraneous forces operating,
eUminated for pedagogic reasons. And even when the prob-
lem is complex the student can handle it successfully because,
in a way, the very subject he is studying suggests an explana-
tion. When, on the other hand, the problem is taken out of
its environment and the student loses his clue, its solution
becomes much more difficult, and is analogous to what is
found in real life. The power to judge in such cases is a
complex of the judgment and the imagination.
Let us take a few examples of school subjects to show how
they train the judgment. Bookkeeping, if properly taught,
helps the student to apply general principles to keeping an
account of business in such a way as to produce a systematic
and economical record and one best adapted to the requirements
of the particular business. The bookkeeper of judgment is
certainly the one who can do this best. In school the constant
practice of the student in keeping sets of books of different
kinds of business, trains his judgment, because he has to apply
the general principles to a variety of situations.
Arithmetic accomplishes the same purpose. In order to
solve a problem, the student has to judge that it is only an
exempHfication of one or more fundamental arithmetical
processes.
Commercial law is a subject in which there is the greatest
scope for the training of this power. Every case at law re-
quires for its solution certain fundamental principles of juris-
Essentials and Value of Business Education 33
prudence. To apply the proper principle of law to a partic-
ular case is not always easy ; and sometimes it is so difficult that
even the trained experts — lawyers and judges — disagree.
The good judge must not only know the law, but he must
know how to apply it. His decision or judgment is the applica-
tion of the law to the particular case. This is exactly what
we have shown to be the meaning of judgment in general.
From this it will be evident that no amount of drill on what
the law is can compare in importance with practice in the
solution of numerous legal problems. Only in this manner,
by the training of the student's judgment, will his study of
commercial law be fruitful to him.
(c) Reasoning. — The student of elementary psychology
finds it difficult to discriminate between reasoning on the
one hand and some of the other intellectual powers like
judgment, which we have discussed, and which seem to in-
volve reasoning. He finds himself, then, in what he con-
siders a hopeless circle. On the one hand, a chain of reason-
ing is a combination of judgments, on the other, each judg-
ment is itself the result of reasoning. This difficulty can be
explained away. Note that the mind is a unity, and all its
so-called faculties are only manifestations of particular
powers of it. Now it has been remarked that even the lowest
manifestation of intelligence — perception — is the result of
reasoning, — the conclusion of a syllogism. But the point is
that the activity of the reason in perception is unconscious,
while in the higher powers it is reflective. Each judgment is
the result of an impHed syllogism, but the premises of that
syllogism do not stand out consciously in the mind. We may
use an imperfect analogy and say that the judgment repre-
sents the sentence, while reasoning represents the paragraph
or extended discourse.
34 Principles and Methods in Commercial Education
In the exercise of reasoning, both inductive and deductive,
the mind makes use of a series of combinations of judgments
to complete its work of arriving at truth. Inductive reason-
ing gives us truths or general principles, which in turn the
mind makes use of to arrive at larger truths. Deductive
reasoning tests the validity of these truths by deriving the
particular facts by deduction from them. To illustrate from
one of our subjects : The laws of a nation are the crystalKzed
experience of the people, extending back many generations.
Their formulation is a process of induction. Given these
laws, and we can define all the relations of men under the
state by means of these. We do this by a process of deduction.
Mathematics, especially geometry, is frequently men-
tioned as the subject par excellence which furnishes training
in deductive reasoning. This is because geometry begins with
a series of most general axioms and definitions, and with the
aid of these it deduces all the properties of space. But we
fear that its disciplinary value is overrated when we compare it
with the possibilities of commercial law when well taught,
as a subject which furnishes training in deductive reasoning.
The trouble with geometry is that, as it is a subject which
deals with a formal aspect of the world, abstracted from its
content, the student fails to see the relation between the
problems of reasoning in geometry and those in real life.
In commercial law, on the other hand, there is as wide a
scope for training in deductive reasoning as in mathematics,
with the additional advantage that the subject deals with
concrete facts. The situation presented is this : The student
is as a rule not asked to discover by a process of induction
what the law is. He is given the law, and asked to deduce
from it applications to particular situations. By the use of
numerous cases the student's ability to deduce the law in a
Essentials and Value of Business Education 35
particular case from a general knowledge of the law, is con-
tinually tested and strengthened. The subject also gives
abundant opportunity for the use of the Socratic method, as
will be shown in the special chapter on methods in commer-
cial law.
Economics is another subject in which deductive reasoning
is employed. The student has discovered the economic
laws. Given a certain state of facts, and he will be able to
give their economic interpretations. But right here the
student must be cautioned that the economic laws are largely
the result of the combined experience of the present and past
ages, and therefore inductive. Even when they are hypoth-
eses, they have been tested so often by experience, that
they may be not improperly said to be based on experience.
The sciences and all the subjects in which the student
derives facts by his own observation furnish good training in
inductive reasoning. The facts collected by the student's
own observation are unified by being shown to be the work-
ings of one and the same law. This is induction. But science
also contains its deductive element. The laws derived by
induction are made use of by being applied to explain new
facts. And just as the inductive sciences have a deductive
element, so the deductive sciences have their inductive side.
Thus in commercial law, the application of the law to partic-
ular cases sometimes leads to difficulties and injustice, and
the generalized expression of this experience is a new law,
established either by decision or by statute.
Why do we call some sciences deductive and others induc-
tive, if both methods are found in all of them? We do this
in accordance with the method which predominates in the
particular science.
{d) Imagination. — Another power spoken of as essential in
36 Principles and Methods in Commercial Education
the training of the business man is the imagination. It may
at first seem strange that the training of this function should
be emphasized in connection with the education for a prac-
tical aim, as it is so frequently associated with the dreamer
and unpractical man. But the imagination reenforced by
judgment is perhaps the most valuable possession of business
genius and talent. The man of imagination is the one who
foresees business possibilities. His suggestive mind is struck
with an idea, and he sees it in its realization, while others
call it far-fetched and impracticable. Our great inventors
have been men of imagination, and it is too familiar to cite
illustrations of how many of them have been called dreamers
when they first propounded ideas.
Now the imagination takes the man out of his accustomed
routine. One man may be familiar with a certain course of
action or line of business policy and he may pursue it along
the well-beaten path. Another man's imagination sees new
business opportunities in this line, new chances for trade
enlargement, new methods of making an impression on the
environment. His imagination gives him the clue to a new
aim, his judgment tells him the best means to use to realize
his aim.
It is the man of imagination in business who has practically
created the branch of business known as advertising. And
where would city and railroad development be without the
imagination of the man who sees a land area in a particular
location covered with trees and uninhabited, and pictures it
as a busy industrial centre of the future ; and puts his faith
in practice by helping to make his picture a reality ?
There is another sense, although not exactly a practical
one, in which the training of the imagination is important,
and which will be spoken of in connection with cesthetic
Essentials and Value of Business Education 37
training. The man who lacks imagination will not be recep-
tive to art and literature, and will therefore have shut to him
one gateway of experience through which so many things
enter that make life richer and more harmonious. The
study of literature is one of the best means of developing the
imagination, and it becomes of added importance because it
forms the habit of reading, and therefore of extending one's
means of self-education.
Now to consider briefly how some of the technical com-
mercial subjects develop the imagination. Bookkeeping and
accounting, with their matter-of-fact statements and columns
of figures, are nevertheless a fruitful source for the man of
imagination. What are those facts on the books but sym-
bols which stand for the business and its progress ? The
imaginative person will at once construct in his mind an entire
picture of the business, in its concrete workings, its progress,
and its present status. This picture will at once suggest to
him whether the business is healthy or whether there are
symptoms of disease, — where there are leaks and where
there are opportunities for further development. It is true
he will proceed to test his theories and surmises by a close
analysis. But the general impression, the synthesis which
gives the cue to his analytic activity, is the result of his im-
agination. Practice in interpretations of facts as they are
presented in sets of books is therefore a most valuable adjunct
to the training of the bookkeeper.
Commercial geography is the subject in which there is the
greatest scope for the imagination. It is when the imagina-
tion is lacking that the study becomes a dead recital of facts
and figures. The imagination imbues it with Hfe. The
student must be taught to make a synthetic picture of the
country in all its industrial activities. Every new fact
38 Principles and Methods in Commercial Education
studied about the country will take its proper place in the
picture, and help to make it more complete and more vivid,
instead of adding one more fact to be carried by the memory.
The imagination plays such an important part in this sub-
ject, that it will be discussed further in connection with the
chapter on the teaching of commercial geography.
The imagination plays quite as important a part in the
study of industrial history. The past must be reconstructed
with all its activities. Only by regarding it in its unity can
we draw the valuable lessons it gives us. Unless the imagina-
tion constructs these pictures, the study of history becomes a
mere chronology of facts. Elsewhere it will be shown how
the imagination can be applied to the greatest advantage in
the study of the history of commerce.
It is possible to trace the imaginative element in every
subject, — even in arithmetic, which seems so far from it.
Here, again, the imagination gives life to the problem by
relating it to the concrete activities of life. What is a prob-
lem in bank discount to the unimaginative student ? Merely
an example in interest, — in multiplication. To the student
whose study of arithmetic has been correlated with the study
of business processes the problem recalls the bank, the note,
the technique of discounting a note, etc. And thus the
example in arithmetic becomes a vehicle for a better under-
standing on his part of the ways of business. In every re-
spect, then, the imagination helps to lift us out of mechanical
routine into novel paths full of possibilities of progress.
2. .Esthetic Training. — It was pointed out before that
complete living comprehends the ability to enjoy one's
leisure. Training in the appreciation of art has only an in-
direct bearing commercially (we do not have in mind train-
ing to become an art dealer), but it results in giving us a
Essentials and Value of Business Education 39
completed self-realization of the richness and possibilities of
life, of putting our souls in rhythm with the larger life, —
the life of the spirit, of which the industrial phase is after all
but a fragment. The refining influence of art, literature, and
music is what prevents the soul from getting sordid in the
counting-house atmosphere and helps it to realize that there
is a larger life than that of business.
For this reason the study of literature should be kept up
during the entire course. A love for the great works of the
master-minds of the past, and an appreciation of them, is
what the course in literature should produce, so that when
the student leaves school he will still retain that habit of
reading which will continue to exercise its refining influence
on him and open for him a path for self-culture. The study
of music, similarly, ought to have as its object not technical
proficiency, but power of appreciation. This can only be
gained by repeated listening to good music. The school can
do only a limited amount in this direction, but as in other
subjects, it can lay the foundation on which the student can
build by his own initiative.
In the teaching of drawing we find the aesthetic element
made a means to an end, and the teaching of art acquires a
utiHtarian object. Here the achievement of the beautiful is
pursued not for its own end, but because it enhances com-
mercially the value of the object with which it is associated
by making it more in demand. The association of the artis-
tic with the useful is a very desirable thing, — especially in
American manufactures, where the needs of utility are apt
to interfere with aesthetic requirements. Europe has shown
us that the requirements of both can be met in the same object,
and we are slowly following suit. A greater appreciation of
the importance of the aesthetic element in commerce will add
40 Principles and Methods in Commercial Education
greatly to the equipment of the man of business, and make
him better fitted to compete in the markets of the world.
There are other subjects of the curriculum which can be
made a valuable aid to aesthetic training, — bookkeeping, for
example. The bookkeeper who has learned to keep a neat
and attractive-appearing set of books is worth a great deal to
his employer, not only because his work is striking to the eye,
but because he takes pride in his work, and is therefore apt
to be more careful than the other. Habits of order and
system have their aesthetic side, in addition to their utilitarian,
in making us love the appearance of order and system, and
making the exercise of those very important habits easier.
3. Training of the Will. — By training of the will we mean,
in general, the training to do and to refrain from doing things.
The will expresses itself in activity. But while it is involved
in all mental acts as well, by a process of abstraction we
denominate only such acts as acts of the will in which the
mind expresses itself in action.
Now the will involves deliberation and choice between a
conflict of motives. If these factors were necessary in all
our actions, very little would be accomplished efficiently.
But here we are helped by a remarkable factor, — habit.
The law of habit is that anything which has to be done with
conscious effort of will requires less and less effort on repe-
tition, until finally it becomes second nature, and can be
done without the intervention of consciousness. The ability
to do things this way leaves the will free to handle the larger
problems before it, and to accomplish complex tasks in virtue
of the power to relegate to habit the details involved. Thus
arises the paradox that we train the will in particular direc-
tions by making its use in those directions unnecessary.
The practical task for the educator, then, is the developing
Essentials and Value of Business Education 41
of habits. The test of our ability to do a thing is the abiUty
to do it without thinking. The efficient mechanic has de-
veloped habits which enable him to do good work. In the
planning of his product he has to use his intellect. But the
details of execution are adjusted by his habits. So the good
bookkeeper does not have to think before he can tell how to
journalize a transaction. If he had to do so, it would waste
the time of the business, and prove that he was not suffi-
ciently trained. It is needless to point out that the teach-
ing of stenography is a training of the habit to form short-
hand outlines without thinking. Speed would be entirely
out of the question if the student were not familiar with his
outHnes to such a degree that he could produce them auto-
matically.
Besides particular habits which are important in develop-
ing the expert in the particular trade or vocation, there are
also very essential general business habits, applying to all
lines of activity. These are formed not in connection with a
special line of work, but in the general fine of business train-
ing. Certain habits are indispensable to the success of the
business man. The school in its routine aims to form these
habits which, once acquired, especially at the impressionable
age of school, are not easily broken. Some of these are habits
of industry, economy, system and order, neatness, punc-
tuality, obedience to law, and certain habits more directly
spoken of as moral. The importance of these habits is too
obvious to require extended discussion, but a few words may
be said on how the school can help the student to acquire them.
Industry and punctuality and obedience are of course the
cardinal virtues of the school, and they are insisted upon not
for their own sake, but because they are requirements for
success in life. The development of systematic habits is par-
42 Principles and Methods in Commercial Education
ticularly important in business, — and the study of office
practice and routine ought to impress upon the mind of the
student not so much a particular way of handling certain
matters, but the necessity of handling them systematically.
System means expedition by saving our time and enabling us
to put our hands on things when we need them, a saving of
energy and temper. It stands for efficiency. " A place for
everything, and everything in its place " — this ought to be
impressed upon the student.
The habit of economy is a very important one nowadays,
for the training of which the school can do something. An
examination of the causes of high prices will show that a great
factor entering is that of waste. Too much is wasted that
could be utilized. Our most successful industries are those
in which waste is minimized and everything made use of
either in an increased main product or in the form of by-
products. The oil and meat industries are two conspicuous
examples of business economy and utilization of waste to form
valuable by-products of commerce. Out of a waste-product
— coal tar, which fifty years ago was thrown away — has
grown an industry yielding an annual product of $50,000,000.
The school will help to develop in the student the habit of
economy by teaching him practically how to take care of his
property and of that of the school so as to decrease wear and
tear, and didactically by the study of examples of economy
in industry, such as described above.
There is another habit which the school develops, and which
is very important in business, — loyalty. In school the stu-
dent develops a certain esprit de corps in virtue of his being
a part of the school organization. It takes the form of school
pride and a certain amount of unselfish interest and sacrifice
of personal convenience for the sake of the institution. This
Essentials and Value of Business Education 43
same form of loyalty is manifested in life in the shape of
patriotism and civic pride.
Now it is very desirable to imbue the student with the
spirit of loyalty to his firm and to its interests, just as the
house on its part ought to display toward its employee a spirit
of fair-dealing and an appreciation of good service.
The school can be helpful in impressing upon the student
the fact that just as he takes pride in the welfare of the school
of which he is a member, so he should take an active interest
in the success of the firm, to which he ought to devote the
best of his services, and have a right to expect appreciation
in accordance with his efforts.
The discussion of the training of moral habits is connected
with the general problem of education, — the aim of which
is sometimes said to be the development of character. Aris-
totle speaks of character as a bundle of habits. In using this
term he impHes that a man's character is nothing but a series
of dispositions to act, which have been developed in the
course of education. This view of character simphfies the
problem of the educator. Moral training is principally the
development of the habits of right action. These must be
guided or supervised by the insight of what is right or they do
not serve us in a difficult situation to which our habit is not
entirely adjusted.
A complete discussion of the general problem of moral
education is not entirely in place in this work. Only one
phase of it as related to business ought to be mentioned here.
There are certain notions of so-called business smartness
still prevalent in some circles, which are happily yielding to
a more enlightened conception. These find expression, per-
haps, in the view of an old school of economists, that what
one party gains in commerce the other one loses, and when
44 Principles and Methods in Commercial Education
a man " drives a bargain " with another he does so at the
expense of the other. These notions are only expressions
of a common view of business, which not only condones
misrepresentation and sharp deahng, but actually applauds
them by calling them business knack and abihty. Sound
economic theory has demonstrated that commerce is based
upon mutual advantage; that in the long run it cannot
prosper unless it is characterized by honesty, reliabihty,
truthfulness, and fair deahng. Firms which have adopted
these standards have built up a good name which is their
most valuable asset, and constitutes an essential part of their
good will in trade. They prize their trademark because people
have learned to look upon it as a guarantee that the goods
possess all the quahties alleged of them.
It is a question whether the school ought to offer a special
course in business ethics. If such a course is given, it ought
to emphasize first that it is the individual's duty to be honest
and truthful and loyal in business, and secondly, that it is
the best policy to be so, and that it pays in the long run.
Nor should emphasis upon these qualities be confined to the
course on business ethics. All the other subjects offer abun-
dant opportunity for impressing these lessons.
We have now reviewed the essential subjects necessary to
give the student the proper outlook upon business, and the
particular factors involved in his training. We must again
make clear the fact that the school is only a preparation for
real business, and that it cannot expect to turn out a com-
pletely trained business man. No school, no matter how
fine its curriculum and efficient its instruction, can take the
place of experience on the firing line in contact with men.
But given the man with thorough preHminary training enter-
ing commercial Hfe, and in a short time he will shake off his
Essentials and Value of Business Education 45
diffidence and lose his awkwardness, and come into a position
in which he can apply his scholastic learning to real problems
of everyday business, with a larger mind and a firmer grasp
than the one who " started at the bottom."
However, let not the student who has completed the com-
mercial course assume that his education is complete. He is
only prepared to make an intelligent start. To rise in his
field he must keep abreast of the progress of the times. Having
secured a general commercial culture in school, it is now his
duty to specialize in his studies, in the particular business
hne which he has chosen. To provide such means for special-
ization is the function of the higher commercial school.
The work of the latter ought to be especially fruitful,
because its students have actual business experience, and
are constantly in a position to test theory in practice, and to
interpret their practical experience in the larger light of the
experience of their masters in the same field.
SUMMARY
The apprentice system in business is rapidly yielding to
special educational preparation in the school. Specializing
for business ought not to be begun before the general founda-
tion in the elementary school has been laid. The vocational
aim, combined with the culture and disciphnary aim, should
rule in the secondary school. Higher and narrower speciali-
zation is in place only in the university school of commerce.
The essentials of a business education are discussed under
the heads of language, mathematics, bookkeeping, and account-
ing, business practice and office routine, stenography and
typewriting, science, technique of commerce, economics, com-
mercial geography, history, civics, commercial law, and
miscellaneous subjects.
46 Principles and Methods in Commercial Education
Disciplinary phases of business education : Business prac-
tice, commercial geography, and the technique of commerce
train the power of observation ; commercial law is very effec-
tive in training the judgment ; the natural sciences are the
best subjects for inductive training, and mathematics and
economics and law the best for deductive reasoning. The
imagination is a power, the development of which is very
important to the business man, because it aids him in planning
ahead, and making a mental picture of the results of his plan-
ning. In commercial geography and history, we find the
greatest scope for the exercise of the imagination.
A greater appreciation of the importance of the aesthetic
element in commerce will add greatly to the equipment of
the man of business, and make him better fitted to compete
in the markets of the world.
Among the business habits which the school should help
to develop are : industry, economy, system and order, neat-
ness, punctuality, obedience to law, and habits directly re-
ferred to as moral. Training in both business etiquette and
ethics should be furnished.
EXERCISES
GROUP ONE
1. Discuss the need of special commercial education in light of the
fact that some captains of industry are self-made men.
2. What influence has the disappearance of the apprenticeship system
had upon the need of vocational training in school ?
3. What general scheme of education would you advise for the boy
who expected eventually to take his father's place as the head of a dry
goods concern ? Give reasons.
4. Why should music, physical training, and literature be included
in the curriculum of a commercial high school ? Discuss fully.
5. Should foreign languages be studied by pupils who wish to train
Essentials and Value of Business Education 47
for a business career? Why? Which would you include in the cur-
riculum ? On what basis would you advise a student to make his choice
of a language ?
6. Discuss the place of the sciences, history, and mathematics in com-
mercial secondary education.
7. Of what ctdtural and disciplinary value are a study of (a) bookkeep-
ing, (b) stenography, (c) commercial law ?
8. Every scheme of education should provide for the development of
observation, judgment, reasoning, and imagination. Show how the
ideal commercial programme meets these requirements.
GROUP TWO
1. Assume that you are in charge of a commercial high school, and
that you wish your teachers to form a reading circle. Plan a course of
eight topics on educational psychology, which will have sequence, and
which will cover the subject in the school year. Indicate specific refer-
ences for each topic.
2. Outline a talk on the psychologic and pedagogic bases of commercial
education, suitable for delivery before a convention of teachers.
3. Prepare a detailed set of instruction for the history, English, and
science teachers of a commercial high school which would aid them in
modifying their usual instruction so as to make it available for com-
mercial pupils.
BIBLIOGRAPHY
Conference on Commercial Education, University of Illinois Bulletin,
Vol. 3, No. 8, 1908.
Curry, J. S., Past, Present and Future of Commercial Education. N. E. A.
Report, 1910, p. 835.
Eliot, C. W. Commercial Education. Educational Review, Vol. 18,
1899.
Haskins, C. W., Business Education and Accountancy. New York,
Harper, 1904.
Hatfield, H. R. Lectures on Commerce. Chicago, University of
Chicago Press, 1907.
Herrick, C. a. Meaning and Practice of Commercial Education. New
York, Macmillan Co., 1904.
48 Principles and Methods in Commercial Education
Hooper and Grail\m, Commercial Education at Home and Abroad.
London, Macmillan Co., 1901.
JUDSON, H. P., Higher Education as a Training for Business. Chicago,
University of Chicago Press, igii.
Vanderlip, F. a., Business and Education. New York, Diifl5eld, 1907.
Ware, F., Educational Faundations of Trade and Industry. New York,
Appleton & Co., 1901.
CHAPTER II
The Course of Study of the Secondary Commercial
School
the problem
In the previous chapter we discussed the subject of the
essentials of a business education, in the course of which we
had to consider the choice of subjects to be taught and their
educational values. The question to be considered here is,
how can these subjects be arranged in a four years' com-
mercial course so as to furnish on the one hand a graded
course of special instruction, and on the other a proper cor-
relation with the other subjects requisite to the general cul-
ture of the individual.
And here comes the first question that challenges our
attention. Shall the curriculum of the commercial high
school be based upon that of the general secondary school,
with the substitution of commercial subjects for some of the
general academic subjects? Or shall the entire course of
study be arranged solely with a view to the aim for which
we are preparing the pupil, viz., to fit him to take his place
in his vocational environment ? If the first is to be our basis,
then the work of mapping out the course must be left to the
educator who lays out the general course, with such special
assistance as he may choose to get from the commercial
teacher, in the matter of placing those subjects in the schedules.
But this arrangement hardly satisfies the true function of the
E 49
50 Principles and Methods in Commercial Education
commercial school. The latter is not an ordinary secondary
school, with the substitution of bookkeeping and stenography
for certain of the subjects. The course of study in the special-
ized school we are considering should not parallel the general
secondary course but should aim at the construction of an
entirely new curriculum with an aim somewhat different from
that of the ordinary high school, or in which all subjects —
the commercial as well as the others — shall contribute to
the attainment of the practical end.
The planning of such a curriculum requires a person who
has the broad vocational outlook, as well as a deep view of
the philosophy of education : one who understands how to
blend the practical with the disciplinary elements in educa-
tion, so as to secure the latter without sacrificing the former.
Perhaps no individual is competent to carry out a difficult
task of this kind, without the advice and cooperation of
representatives of all the departments. And the advice of
these speciaKsts will be worth while only to the extent to
which they, too, have the vocational point of view.
Before attempting to construct such a course, we must
again examine the principles upon which it should be based.
The two questions which every curriculum answers are, first,
what subjects shall we teach, and secondly, in what order
shall we teach them? The first question we attempted to
answer in the preceding chapter, and we only need to recapit-
ulate some of the essential points.
The choice of subjects is primarily determined by the
consideration of the civilization of which the individual is a
part, and particularly by the specific vocational environ-
ment in which he will take his place after he completes his
studies at school. Our knowledge, therefore, of the nature
and requirements of business life, determines us in the selec-
Course of Study of Secondary Commercial School 51
tion of the subjects. But other studies, not directly voca-
tional, press their claims, and some of these we recognize the
justice of and admit them into the course for these reasons :
(i) They may be necessary to widen the horizon of the pupil, whose
confinement to the vocational subject is apt to render him oblivious to the
importance of other fields of business achievement. An insight of this
interrelation is not only important from the cultural point of view, but
also from a practical business point. A proper study of related fields
will give the student a better grasp of the meaning of his own.
(2) The subjects may be necessary to develop the intellectual grasp
of the student, without which he will find it difficult to handle some of
the advanced commercial subjects. This consideration is particularly
important in the arrangement of the syllabus for the individual subjects
which are not primarily commercial, but which are taken up because of
the commercial applications to which they lead. Now the study of these
applications is very unfruitful unless it is based upon a sound view of the
fundamental principles of the subject. Examples of subjects of this type
are mathematics and chemistry.
(3) There is another group of subjects which we include in the high
school, because they are necessary for the education of the whole man :
physical training and hygiene for the physical man, and music for the
aesthetic man. It is a fact that may be noted here, by the way, that these
two subjects, so often relegated among the non-essentials, were the two
comprehensive subjects of education of the Athenian people — the most
highly cultured nation that ever existed.
Taking all these principles of choice, the educator is still
confronted with a difficult task. So many subjects press for
attention to be admitted into the curriculum, that it becomes
as much a question of what subjects we shall admit with the
greatest advantage, as what subjects we can exclude with
the least disadvantage.
Ha\dng decided what subjects we will admit into the curric-
ulum, we have to consider in what order of time we shall
teach them, and how much time we shall devote to each :
52 Principles and Methods in Commercial Education
in other words, the construction of the course of study proper.
This question the educator can only answer successfully with
the cooperation of the various departments of study con-
cerned.
The speciahst in commercial education can only give
general directions to the other departments as to what re-
quirements of business the study of their subject ought to
meet. It would be the height of presumption and a gross
interference with their prerogatives, were he to dictate to the
specialists in the other subjects what order and arrangement
of topics should be adopted in the teaching of their specialties.
Each department must therefore work out its syllabus in
accordance with the time allotted to its subjects in the course.
But to do this work with success and in sympathy with the
aim of the commercial course, the teachers of the other
specialties must keep in touch with the requirements of the
business world, which the study of their subject will meet.
As we implied by one of our previous statements, the pro-
gramme builder must determine the allotment of time to the
different departments, not arbitrarily, but after an examina-
tion of the various maximum and minimum demands or esti-
mates by the various departments. And the result of this
examination in assigning a number of periods to a subject is
not to be considered as a measure of its absolute value, but
as a determination of its importance, modified by the grant-
ing of the rightful demands of other important subjects.
The following course is constructed on the basis of a four
years' course with twenty-eight periods of work per week,
each period of the length of forty-five minutes. Counting
thirty periods to the week, this would leave two periods of
unassigned work, which might be devoted to study, confer-
ence, and general assembly periods.
Course of Study of Secondary Commercial School 53
COURSE OF STUDY
First Year
Second Year
Subjects Periods
Subjects
Periods
EngUsh
4
English
4
German
German 1
or
4
or
4
Spanish .
Spanish J
Algebra
4
Plane Geometry ">
or Stenography j
4
Industrial Biology
4
Commercial Arithmetic
2
Industrial Chemistry
4
Business Writing and Forms
3
History
3
City Industries and Munici-
Bookkeeping and Office
pal Activities
2
Practice
4
Music
I
Drawing (or Shopwork)
2
Physical Training
2
Physical Training
2
Drawing
2
Music
I
Total
28
Total
28
TraRD Year
Fourth Year
English
4
English
4
German
German ]
or •
4
or •
4
Spanish J
Spanish .
History
3
History (U. S.) and Civil
Physics
4
Government
3
Bookkeeping
3
Commercial Law
3
Commercial Geography
3
Economics
4
Arithmetic
I
Technique of
Commerce >
Mathematics .
2
3
Accounting and
Auditing
Technique of
Commerce
4
2
or
or
Stenography
Stenography ]
and
7
and
8
Typewriting J
Typewriting .
Physical Training
2
Practicum (Observation)
I
Physical Trainin
g
2
Total
28 or 30 Total
28 or 30
54 Principles and Methods in Commercial Education
Principles upon which Electives are Offered
We may group the courses of the school of commerce into three divi-
sions: (i) the course in commerce; (2) the bookkeeping course; (3)
the stenographic course. As a matter of practical desirability and
convenience, it will be found best to combine (i) and (2) into one course.
This will give us a new division into groups as follows : (i) the commerce-
bookkeeping course ; and (2) the stenographic course.
It will be shown in the succeeding comments on the course of study
that, as stenography and typewriting are technical subjects, of little
practical advantage to any but those who expect to become stenographers,
they will have to be excluded from group (i). On the other hand, it
will be explained in this chapter below, that a stenographer should be
equipped with a pretty thorough knowledge of commerce and bookkeep-
ing, in addition to his special acquirement.
Now, if we offer courses in commerce and bookkeeping, as a part of
group (2), the question arises as to how we shall make room for stenog-
raphy. In the first year the question does not arise. But in the second
and third years the subject is parallel with mathematics which the
accountant needs for its training in methods of analysis, but which we may
dispense with in the stenographic course to much better advantage than
chemistry or the foreign language. (The study of the latter, by the way,
may be of great assistance to the correspondence branch of the busi-
ness.)
To make room for additional work in typewriting we shall have to
take out an additional subject from course (i) in the third year, — the
technique of commerce. Additional work in tj^iewriting is also provided
by increasing the number of periods of the stenographic course to thirty
per week in the third and fourth years. In the fourth year, — accounting
and the technique of commerce are made elective, to make room for ste-
nography.
An examination of course (2) (the stenographic course) will show that
it provides a very fair training in the subjects of commerce (commercial
geography, economics, etc.), a good training in bookkeeping, and a
thorough training in stenography. Thus provision is made for the stu-
dent who wants to become both bookkeeper and stenographer, and
additional facilities are given to him to obtain an acquaintance with the
meaning and function of commerce.
Course of Study of Secondary Commercial School 55
EXPLANATORY REMARKS ON THE SUBJECTS OF THE COURSE
English. Literature. — The study of literary masterpieces
is undertaken in all the four years, with the same object as
in all schools, — the appreciation of our great masterpieces.
Grammar and Composition. — The mastery of Enghsh for
commercial rather than literary purposes is emphasized.
Grammar is reviewed and the principles of composition are
studied, and practice given in descriptive and narrative themes,
based on practical, rather than Hterary topics. Commercial
correspondence should form an important part of the work.
In the second year the student makes a special study of
exposition, and writes themes on commercial processes and
other technical matters. There is always a good opportunity
to correlate by selecting themes from other departments of
study, especially those in commercial subjects. In the third
year the student is offered practice in special commercial
topics, Uke writing reports on various business matters, ad-
dressed to the employer ; writing and arrangement of adver-
tisements ; condensing letters into telegrams, etc.
In the fourth year the principles of argumentation are
taken up. The topics for debate are then based principally
upon economics. Debating is a regular class exercise and
not left to literary societies. The advantages are, that the
student gets a good grasp on the questions of the day, and
learns how to express himself fluently, clearly, and forcibly.
Practice in written compositions is given to him by the re-
quirements of a thesis embodying the results of his own
observations in practical business, tested by the general prin-
ciples which he has learned. As in the other three years,
there is practice in writing short themes, and besides, an
intensive study of trade reports and trade journals.
56 Principles and Methods in Commercial Education
Foreign Languages. — The student is given the choice of
German or Spanish. It is idle for him to attempt two foreign
languages, for unless he can undertake a language in order
to obtain some degree of mastery of it, his time will be prac-
tically wasted. And to study a language for less than four
years for any practical advantage is out of the question. As
to the study of the language itself, the purpose of taking it
should be mainly a practical one, — to facilitate the student's
work in his future relations with the country whose language
he is studying. Conversation, technical phraseology, and
commercial correspondence are therefore of far more impor-
tance than the literature or the philology of the language.
As to why French is omitted from the list of languages to
choose from, it is clear that while it is the language of
diplomacy and polite society, it is not of coordinate impor-
tance commercially with Spanish and German.
Mathematics. — In the discussion of mathematics under
this heading, we do not specifically refer to commercial
arithmetic, which is treated separately, because the commer-
cial side of it is more important than the mathematical one.
The question often arises, Why should we teach mathematics
at all? The answer generally given mentions the disci-
plinary value of the study : its development of the power of
reasoning, habits of accuracy, etc. But to include the sub-
ject for three years in a commercial curriculum, we must
give a more satisfactory reason, because there are a number
of other subjects which are just as valuable as mathematics
in their training of the mind. Nor does it always follow that
the mathematician's reasoning power is good in other than
the abstract field of mathematics. We must reenforce our
argument for the study of mathematics by reference to its
utiHtarian value.
Course of Study of Secondary Commercial School 57
Mathematics, in particular algebra, gives us a new language,
a symbolic one, which is indispensable in many calculations
relating to values. It is entirely impossible to understand
many of the aspects of accounting without a knowledge of
the meaning and the manipulation of formulas. Nor can we
understand calculations in chemistry and physics without use
of such formulas. It is needless to refer to the fact that many
problems of higher arithmetic can be solved more rationally
and with greater ease by algebra.
First Year. Algebra is prescribed for all students.
Second Year. Plane Geometry, — a subject which, if well
taught, is a great stimulus to the imagination and to inven-
tiveness, and to the power of sustained thinking. It is not
offered to those who pursue the stenographic course.
In the third year the student returns to algebra as an elec-
tive. He emphasizes particularly those phases of it which
are necessary for finance. Logarithms are studied, because
they faciUtate financial calculations. Among other topics
are progression, permutations and combinations, and the
theory of probabilities. The mathematics of finance is in-
cluded in this year : such as compound interest, present
worth, annuities, investments, Hfe insurance, etc.
Industrial Biology. — It was pointed out before that while
a study of biologic processes is necessary as a theoretic founda-
tion, the study should lead up to the economic aspect of the
subject : how these processes affect man in his Hfe and in his
acti\'ities. Botany is of course a very important aspect of
this subject, because many of the materials of commerce are
of vegetable origin. In constructing his course the teacher will
take up among other topics the raising of plants, the bio-
logical history of the plants of commerce, and their prepara-
tion for the market. A study of the diseases affecting plants
58 Principles and Methods in Commercial Education
and their inilucnce on commerce is also to be undertaken,
together with a study of their remedies.
Industrial Chemistry. — The course in Industrial Chemis-
tr}- is intended to be given the second year of the course.
Starting with the theoretic basis of chemistr\', — chemical
law and processes, — and the principal elements, it specializes
in the direction of the industrial applications. The field is
large, and the teacher will find himself at a loss what topic
to select. But some study should be devoted to the follow-
ing : Chemistry of coal ; f>etroleum and its refinement ; illu-
minating gas ; chemistrj' of the soil and fertilization ; the ores
and their reduction ; dyestufTs ; chemistry of food ; food
preservations and food adulteration ; the chemistry of stains ;
the chemistr>' of fabrics.
Physics. — Physics follows chemistr>', and is taken up in
the third year. The usual course in elementary physics is
followed with special attention to the industrial phases, such
as machines, motive power, the steam engine, and electricity
and its applications. To make room for many of the applica-
tions of physics it may be necessar>' to eliminate a great deal
of the mathematics of the subject.
History. — The course in history- brings up the question
whether the historj' of commerce ought to be taught as a
separate course and in the department of commercial subjects.
On the whole, we believe that the history of commerce had
best be taught as a part of the general historical course, —
first, because taking it out of the regular course deprives it of
its proper background, and secondly, because the commercial
teacher is apt to lack the historical perspective. In view of
the fact that historical students are concentrating their atten-
tion more and more on the social and economic side of historj',
and are subordinating the political and military' side ; and as
Course of Stu^y 0/ Se^ond'iry Commercial School 59
modem text-books are written with this in \-iew. it would be
safe to leave the histon.- of commerce to the department of
general histon.'.
The first half year of the second year will be devoted to a
rapid survey of Greece and Rome, leaxing a year and a half
for general histors'. \^-ith special attention to English and
modem German political and economic histor>-.
The fourth year will take .\merican histor>- and d\-il gov-
ernment .\n important part of the study of our govern-
ment should be devoted to a detailed inquir>- into its depart-
ments, their administration, and particularly their relation
to commerce. Those of greatest importance to the business
man are of course the Treasury- Department the Department
of Commerce, the Post-office Department, and the Depart-
ment of Agriculture.
COMMERCIAL SUBJECTS. Industries and Commerce
of the City. — This Cv.»ur=<: is prescribed for the drsi hai: year.
It forms the proper introduction to commercial geography and
to technique of conmierce in general ; for many of the industrial
acti\-ities of the world are exemplified in or about a local
centre. The same reasons that apply to beginning general
geography with the study of the home en\-ironment apply
with equal or greater force to b^inning conmierdal geography
with the industries and commerce of the dty or locahty in
which the schcvl is situated.
Municipal Activities. — This course continues the study of the
dtv with reference to the poUtical and economic actix-ities of
the city govemment. While a knowledge of how the dt>- is
govemed is, of course, one of the prindpal aims to be at-
tained by this course, it is by no means the only one. The
administjation of the dty is like that of a great corporation ;
munidpal problems outside of governmental ones continuany
6o Principles and Methods in Commercial Education
confront us. This course would therefore include the con-
sideration of civic problems such as the transit, the city
beautiful, congestion of population, health, and other prob-
lems.
Commercial Geography. — This course is set down for the
third year. It may arouse some comment why the course is
postponed to such a late period, as in some commercial
schools it is actually taught in the first year. If, however,
the course is to be preceded by one on the locality, it is
out of the question to give it before the second year ; and it
is best to defer it until the third year, for reasons that will be
apparent. It must be understood that commercial geography
is not a mere study of a Ust of countries, their chief products
and commercial ports, etc., although it is often studied as a
catalogue of facts.
If properly taught, it is designed to develop real power in
the student, to awaken in his mind a view of our commercial
standing, our trade problems, our commercial rivals, and the
possibiUty of expansion. It, therefore, would take minds of
some maturity to undertake such a study. Our third-year
student will have a good preliminary training in his study of
industrial geography of the locality and in his courses on
biology and chemistry, which constitute a scientific course on
the materials of commerce. The latter, in a crude fashion,
is frequently included in commercial geography. After the
student has been grounded in biology and chemistry, his
review of materials of commerce in connection with his com-
mercial geography is much more than a mere study of a
cut and dried catalogue of products. We have mentioned the
fact that the course on commercial geography should include
the careful consideration of trade problems, — such as com-
petition in the world's markets, the Oriental trade, and the
Course of Study of Secondary Commercial School 6i
probable effect of the European War on the commerce of our
country and that of the combatants.
Commercial Arithmetic. — Provision is made for this subject
in the first year for two periods a week. It includes not alone
a thorough drill in fundamental operations but also the hand-
ling and solution of practical business problems of calculation.
In the last year of the course, one period a week devoted to
the study rounds out the practical knowledge of the student,
and gives excellent material for correlation with accounting
and economics. The teacher of advanced arithmetic should
not fail to take advantage of the student's knowledge of algebra
in order to simplify, organize, and rationalize this part of the
work.
Business Technique. — This course is preparatory to the
course in bookkeeping. It includes, in the first half year,
practice in penmanship, and in the second half year the study
of business forms such as checks, drafts, bills, invoices, and
other forms in every-day use in business.
Bookkeeping and Office Practice. — In the second year of
the course the elements of single and double entry are taken
up as applied to various forms of business.
In the third year more advanced work is taken, such as cor-
poration books, specialized sets, etc. For a detailed discussion
see the special chapter on bookkeeping.
Accounting. — Provision is made for a whole year's study
of the subject. What shall we include in it? As a special
chapter will be devoted to it, it need only to be considered
briefly here. The elementary theory of the whole subject
will be taken up. It will be a deductive study of what was
done inductively or empirically in bookkeeping. To under-
stand the place of accounting, we may use the analogy of
geometry here. Our first knowledge of geometrical facts was
62 Principles and Methods in Commercial Education
empirical ; that is, obtained from experience. The human
mind then recast its body of knowledge into a system, by
deducing it from fundamental principles. The relation be-
tween bookkeeping and accounting, then, is the same as that
between empirical geometry and EucHdean geometry.
But besides the scientific study of the theory of accounts
the course will include the study of auditing ; and also practical
accounting. In addition to the solution of accounting prob-
lems there will be continual practice in the interpretation of
accounts, in cost accounting, in deductions to be drawn from
profit and loss statements and balance sheets, and in recom-
mendations to be made on the basis of these statements.
Economics. — This study necessarily comes the last year :
first, because of its difficulty ; secondly, because before any
person can be in a position to draw economic conclusions, he
must have a large basis of fact. In the fourth year the stu-
dent can handle economic problems intelligently, because he
has three years of stored-up experience to draw upon. There
can be no question, of course, as to the importance of the
subject, as economics is the philosophy of business. The
course should be supplemented by a study of the principles
and practice of corporate and public finance.
Technique of Commerce and Industry. — This subject is
provided for in the third and fourth year of the course. It
is not offered to the students of stenography. Only a few
brief remarks will be made here on this subject, as it will be
treated at length in a succeeding chapter. Most of the topics
under this subject are such as would be included in a course
on applied economics. Among the topics in the third year
are the forms of industry : (i) extractive, (2) manufacturing,
(3) distributing. Under (i) we shall discuss agriculture,
piining) and fisheries. To differentiate this course from that
Course of Study of Secondary Commercial School 63
of commercial geography, we shall discuss processes and
problems of these industries and preparation for market.
Under (2) the question of location and organization of manu-
facturing plants, motive power, etc., will be discussed.
Under (3) we shall consider the organization of business for
distribution : the wholesaler and the retailer ; the corporation ;
the trust. The study of preparation for the market and the
technique involved, such as methods of packing and trans-
portation, etc., is a part of the course.
In the fourth year under the same title. Railway Transpor-
tation will be studied in detail. Money and credit will be
taken up, including such topics as banking, the exchanges, the
commercial credit system, etc. Perhaps in this course, as
appropriately as in any other, business ethics might be con-
sidered.
Commercial Law. — Three periods a week are assigned to
this subject in the last year. While a good text-book is used
in this work, references to the sources of the law are not to be
overlooked, and whererer possible, some leading cases are
to be studied at first hand. A special chapter in this book is
devoted to the aims and methods of the subject.
Drawing and Illustrating. — In the work in drawing, the
utilitarian element is quite as prominent as the aesthetic.
A handiness with the pencil and brush are quite desirable in
commercial life, as well as a readiness with the tongue and
pen. The course is offered the first two years, but where
there are facilities, shopwork may be given as an alternative,
for the work of the second year. The value of manual train-
ing to the business man is quite obvious. No amount of theo-
retical study can give the student as good an insight into the
construction of things about him, as practice in making them
himself.
64 Principles and Methods in Commercial Education
The course in drawing will include lettering and design,
illustrating and arranging advertisements, and perhaps some
mechanical drawing.
Stenography and Typewriting. — This is, of course, a very
important subject of the commercial curriculum, but it ranks
more as a special accomplishment than as a subject of general
utility to the commercial student. For a student who is not
going to be a stenographer the benefits derived will be entirely
incommensurate with the time devoted to it ; and if he has no
occasion to practise it, he will forget it entirely. For these
reasons the course is made elective.
It may be asked why the student of stenography should
take practically the entire curriculum instead of devoting
his time to making himself more efficient in his specialty.
In answer we may say, that aside from the general culture
that the entire course gives him, the stenographer gets a
thorough insight into business, and fits himself for a position
of larger responsibiUty. Many stenographers have risen to
managing positions in the business.* We do not want to
educate stenographers who are mere machines, but intelligent
students of business who realize the meaning and opportunities
of the business in which they are employed. An extremely
valuable part of their preparation is, of course, the thorough
study of EngHsh. At the same time we must bear in mind
that the acquirement of technique by the pupil is what we are
aiming at in the teaching of stenography and typewriting,
and that this can be obtained only by a most thorough knowl-
edge of the principles and practice of writing clearly and
rapidly.
The work is begun in the second year, when four periods a
week are devoted to shorthand. Typewriting may be begun
the same year. But, generally speaking, schools will find it
Course of Study of Secondary Commercial School 65
difficult to provide enough equipment, and so the typewriting
work is begun with the third year, and three periods are given
in addition to the four periods in stenography. A great deal
of the practical facility in typewriting the student will have
to acquire by writing after school hours, the hours in school being
devoted to formal exercises and to criticism. On the aims and
methods of stenography and typewriting see the special chap-
ter on the subject.
The question will arise here whether German and Spanish
stenography should be taught in the regular course. In a
general way we may answer that such knowledge is rarely of
any use, — and the occasions where a person might make
use of such knowledge are very few. Consequently, it is not
advisable to include such special instruction, unless there is
a specific demand for it.
Practicum. — In the last year one period a week is devoted
to a conference and discussion by the members of the class
of results of their own observations in business. Each pupil
should be required an(J given the opportunity to visit great
business establishments, to observe methods and processes,
and to report to the class.
This work will be of benefit in the following directions :
It will reenforce, by practical illustrations, the work taught
in the school ; it will give the student practice in oral and
written composition ; it will sharpen the power of observing
and the critical faculty of the student, and it will give an
opportunity of free exchange of thoughts between teacher and
pupils. It will be of the highest importance in those schools
which have established practical cooperative relations with
the business community.
Conclusion. — We will remark, finally, that the foregoing
course of study represents one which, in the minds of the
66 Principles and Methods in Commercial Education
authors, represents a standard type. There are, it is
true, disturbing influences in many places, which compel
deviations from the type. Such influences are : the impos-
sibilities of having a separate commercial high school, and
therefore the necessity of combining the commercial students
with the other students of the school in certain subjects ;
the fact that some pupils change their minds about continu-
ing their commercial course, and desire to change to the
academic course, and the consequent necessity of making such
transition possible ; the fact that many pupils drop out be-
fore completing school, and the necessity therefore of making
the first two years of the course more or less complete in them-
selves. Many other disturbing circumstances might be
thought of. Now to construct a course of study in which all
the possible disturbing elements should be taken care of is
an impossibility. To construct such a course, having in mind
some of these elements, would not be presenting a standard
course of study. The best solution to our minds seemed to
be to arrange a course as it ought to be under more or less ideal
circumstances, and to allow each educator to modify it for
himself in accordance with local conditions.
The objection to deviation, in certain subjects like English,
from the standard course set by the college entrance board,
on the ground that the latter board will not give credit for
such subject, should be of Httle moment. The time has come
when the college entrance board must recognize that its re-
quirements should keep abreast with the demands of the
time. There is no reason why some commercial subjects,
which are of as great disciplinary value as most academic
subjects, should not be credited for college entrance. Provi-
sion for this has only recently been made. But much still
remains to be done. What reason is there for setting a uni-
Course of Study of Secondary Commercial School 67
form course in language for all schools ? Is there any partic-
ular ground for the board's refusal to recognize that there are
other uses of English besides Hterary? If teachers will per-
sist in their rational demands for full recognition, their re-
quests will be granted.
SUMMARY
The planning of a curriculum requires a person who has the
broad vocational outlook as well as a deep view of the phi-
losophy of education. Our knowledge of the nature and re-
quirements of business life determines us in the selection of
studies. But studies not directly vocational are also included
because they are broadening, because they develop the intel-
lectual grasp, and because they are necessary for the education
of the whole man.
A course is presented, which is constructed on the basis of
four years' work, with twenty-eight periods per week. There
are three divisions to the curriculum : (i) the course in com-
merce ; (2) the bookkeeping course ; (3) the stenographic
course, (i) and (2) may be combined, so as to give us these
parallel elective courses : (i) the commerce-bookkeeping course,
(2) the stenographic course. The latter will include some work
in bookkeeping and the science of commerce.
The courses outlined represent a standard type. Local
conditions may compel a slight de\'iation from the type.
EXERCISES
GROUP ONE
1. Can an ideal commercial curriculum be formed by modifying a
general course curriculum, or must an entirely new one be arranged?
Give reasons.
2. Divide the commercial programme into three groups of studies, and
give three examples of each division.
68 Principles and Methods in Commercial Education
3. Why should the bookkeeping and stenography departments of a
commercial high school be separated ?
4. Show how the treatment of algebra in a commercial school dififers
from the treatment in a general high school.
5. Give the content of a course in commercial geography.
6. What is the place of economics in the commercial high school
course ?
7. Should typewriting be studied by pupils who do not elect ste-
nography ? Why ?
8. If a pupil can remain in high school long enough to take only one
year of bookkeeping or stenography, which subject would you advise
him to choose ? Give reasons.
9. Show the value of the "practicum."
GROUP TWO
1. Prepare a three-year course of study for a commercial high school.
Show what principles have guided you in adapting the four-year course
for this purpose.
2. Criticise the course of study of any commercial high school with
which you are familiar, pointing out its strong and its weak points.
Advocate such changes as are both practical and valuable, with reasons.
3. Assume that you were allowed to substitute commercial subjects for
twenty per cent of the work ofifered in any general high school with which
you are acquainted, state how you would proceed, and present the result.
Defend your choice.
4. State how you would conduct a practicum so as to aid the boys
and girls of your school and also the business community.
BIBLIOGRAPHY
Farrington, F. E., Commercial Education in Germany. New York,
Macmillan Co., 1914.
Herrick, C. a., Meaning and Practice of Commercial Education. New
York, Macmillan Co., 1904.
HoLLiSTER, H. A., High School Administration. Boston, Heath & Co.,
1909.
Johnson, J. F., Commercial Education. (In Cyclopedia of Education.)
New York, Macmillan Co., 191 1.
Course of Study of Secondary Commercial School 6g
Murphy, C. H., Curricula for High Schools of Commerce in the United
States. N. E. A. Report, 191 1, p. 852.
Report of the Committee of Nine (N. E. A. Com. on Commercial Education).
Bulletin No. 23, University of the State of New York.
Thompson, F. V., Report on Commercial Education in New York City.
(In Report on School Inquiry.) New York, Board of Estimate and
Apportionment, 1913.
CHAPTER III
General Principles of Method
application to the teaching of commercial subjects
The general principles of teaching are based partly upon the
nature of the subject to be taught, but principally upon the
nature of the mind to be taught. While in a general sense
principles of teaching are practically the same, the appUcation
of the principles to the different subjects raises certain impor-
tant questions which we shall consider here. The teacher
of commercial subjects is particularly interested to know how
these principles help him in the solution of the peculiar prob-
lems that face him ; and as the general writer on education is
unfamiliar with the ground travelled by the teacher of our
subjects, the commercial teacher generally looks in vain for
practical illustrations of the general principles to his special
field. The purpose of this chapter, then, is to consider some
of the leading principles which should guide the teacher, and
to illustrate the application of these principles to the teaching
of commterfial subjects.
I. Teacher's Knowledge of the Subject.^ — Before consider-
ing the subject of teaching, it is necessary to look at the pre-
requisites for all good teaching, and that is, a knowledge of
the subject taught. This involves a certain amount of general
culture and special training in the subject on the part of the
^ For a detailed discussion of this topic see Chapter XV.
70
General Principles of Method 71
teacher who is to undertake the work. It is evident that the
person who knows no more about the subject he is to teach
than what he expects his pupil to learn, is very inadequately
prepared for his task. The successful teaching of bookkeep-
ing, for example, involves an understanding not only of the
clerical or routine aspects of the subject, but of the rational
or scientific background of it, the science of accounting. The
same reason appHes here as in the case of the teacher of arith-
metic, who should be acquainted with algebra (the science
which gives the laws to arithmetic), in order to teach his sub-
ject successfully. Our educational authorities recognize this
fact by providing an examination for candidates, and an edu-
cational prerequisite which covers in scope a great deal more
than the curriculum which the teachers are expected to
present in the secondary school. But not only must such
teacher have a rational and organized view of the field of a
specialty, but he must have the general cultural background
which will enable him to see the true place of his specialty
in the general scheme of knowledge, and enable him success-
fully to correlate the subject he is teaching with the other
subjects in the pupil's curriculum.
It follows, then, that no teacher can be successful who is
not a person of culture. It is true that a great many of our
teachers of commercial subjects are not persons of culture,
because they have not had the opportunities for a good, gen-
eral education. Many of them have stepped from an unsuc-
cessful business career and have taken to teaching as a make-
shift. If those persons only realized that the means of self-
culture are within their reach, and if they continued their read-
ing and study, they would make up in a large degree for their
early disadvantages. As a matter of fact, the teacher of com-
mercial subjects is required to teach so many different branches,
72 Principles and Methods in Commercial Education
that if he really understands the subject he is teaching, he is
bound to be a person of general culture. A real knowledge of
commercial geography and the history of commerce is itself
an indication of culture. Unfortunately, many of the teachers
who teach these subjects have only a superficial knowledge of
the subject they are teaching ; a knowledge of what is in the
text-book they are teaching.
We must indicate briefly in what way a teacher can make
up deficiencies in his general culture, and in what way he can
remain progressive.
First : He must keep abreast of the times. That is, he
must have access to, and take advantage of, the latest pub-
Hcations in the subjects which he is teaching. The results of
that progress are found not in books alone, but in magazines
and journals. Again, since a good deal of the material in
commercial geography is statistical and as text-books cannot
possibly be up to date, the teacher must supplement the
statistics in the text-book with those he gathers from various
statistical summaries. He must therefore keep in touch with
the progress of the world.
Secondly: Where opportunities exist for self-improvement,
he must take advantage of them — such as university courses
and lectures. Many persons find it difficult to study by
themselves. In many cases, the lack of previous training
may make it impossible for the teacher to keep pace with the
latest publications on the subject and with the latest periodicals
in the field. A course in a subject connected with his specialty
will therefore not only make up for the teacher's previous
lack of training, but it will give him an instrument for self-
culture which he can use after he leaves the course. It makes
no difference whether the subject he is studying is on a much
more advanced plane than the one on which he is working in
General Principles of Method 73
the secondary school. If we expect to have teachers who will
elevate the standard of commercial teaching, who will show
the teachers of academic subjects that this work is just as
cultural as, and more so, perhaps, than the other subjects,
we must have teachers broad in mind and knowledge, and
responsive to the progress of the times.
All this discussion might imply that the ideal teacher of
commercial subjects would be a university trained man, who
has done extensive work in the subject. This is not necessarily
true. In the first place, it is not essential to have a college
degree in order to be a person of culture. In the second place,
mere knowledge of the subject is not a guarantee of good
teaching. There are special problems connected with teach-
ing that require consideration apart from the study of the
subject : facts connected with applied psychology, that help
us solve many of our problems in teaching. The lack of this
knowledge will often lead to failure in teaching. At one time,
the only requisite for ability to do bookkeeping was practical
experience as a bookkeeper. We now realize how inadequate
this knowledge is, how a person possessed of mere office
knowledge lacks the perspective and the culture which have
been pronounced to be prerequisites of the successful teacher.
On the other hand, we realize now that knowledge alone is
not sufficient to make a good^ teacher ; that an understanding
of the principles of teaching and abihty to apply them are both
just as important. We have daily illustrations of the woful
lack of ability to present the subject on the part of persons
who have a broad knowledge of the subject, but who fail to
realize that mere presentation of the subject in the form of a
lecture is not teaching. In the following paragraphs it is
proposed to outline the leading principles of method which
the teacher must bear in mind in his work.
74 Principles and Methods in Commercial Education
2. Principles of Teaching.^ (i) Principle of Self -activity.
— The greatest principle in all teaching is the one which
points to the fact that the most successful teacher is the one
who accomplishes the maximum of result with the minimum
of effort. Teaching consists not in lecturing, but in stimu-
lating the pupils to the greatest amount of effort and self-
activity. For this reason, we condemn all methods which
consist merely of a lecture or presentation on the part of the
teacher. In successful teaching, the teacher is in the back-
ground, and merely stimulates the pupil to self-effort by means
of questions and problems for solution. In view of the nature
of bookkeeping and stenography as subjects which require
" doing," it is not possible for teachers to confine themselves
to lecturing on these subjects. But even in accounting, we
find examples of teachers presenting the problem, solving the
problem for the students, and having them copy the solution.
The proper method should be by means of questions
which lead pupils to attack the phases of the problem, and
to master the various difficulties by their own efforts. In
commercial geography or in history, we are apt to find teachers
indulging in lecturing instead of asking questions which
stimulate thought. The method by which the student is
given certain problems for solution, by which he is led to
observe for himself the facts of the world about him, by which
he is brought to recognize facts for himself under the stimulus
of questions by the teacher, — this method is the one which
leads to the highest expression of self-activity. We may sum
up by saying that we learn by doing, and doing means both
doing and thinking. In fact, thinking is the highest form of
self-activity. The person who has thought out a problem for
himself, remembers the solution of it without difficulty, while
^ In this connection see also Chapter I, pp. 24 to 45.
General Principles of Method 75
the student who has memorized somebody else's solution has
put in a lot of wasted effort in the task, because the solution
is kept in his mind by mechanical effort, and the knowledge is
only temporary.
(2) Interest and Purpose. — Since self-activity of the pupils
is the sign of successful teaching, we must indicate some of the
means by which this self-activity is promoted. The first
step in every lesson should be an attempt to make the student
reaHze the purpose of what he is doing, so as to interest him
in the subject. This interest will become a kind of compelling
force which will lead him cheerfully to exert the greatest
effort in the accomplishment of his task. The principle of
motivation has its appHcation in all subjects of the curric-
ulum. It is because the bearing of the thing studied is not
seen by the pupil that he frequently approaches his task bhndly
and grudgingly. If there is any class of subjects in which the
pupil ought to have a realization of what he is doing and of
the way in which the topic he is learning is going to advance
his general efficiency, it is in commercial subjects. The study
of these subjects has a vocational purpose. Every topic,
therefore, ought to reveal to the students how they are ad-
vancing in the direction of better vocational adjustment.
The application of the doctrine of purpose, or " motivation,"
as it is sometimes called, is very extensive. In bookkeeping,
we make the student feel that a particular method which we
are adopting satisfies a certain need, instead of throwing a
lot of rules about journalizing at the pupil. We continually
suggest problems and difficulties to him in order to impel
him to overcome them ; and when this impulse is strongly
felt, we show him how to direct it. Thus he approaches the
task of the solution of the problem with greater zest and with
a greater sense of its importance. In accordance with this
76 Principles and Methods in Commercial Education
principle, we should never introduce a new book or a new
column without previously having the student realize the need
of such a device.
In stenography, too, the usual mistake is to introduce an
abbreviation or contraction without an explanation of why
such a contraction is introduced. The good teacher ought
to put the pupil in the attitude of the inventor of the short-
hand system, who, reaUzing the frequency of a certain word
or letter and feeling the necessity for a shorter form, invented
a shorthand outline for it.
In commercial geography, facts and figures given to the
student find him in only a passive mood for the reception of
them. It is only when he has seen the problem, realized the
necessity for solving it, and done his part in solving it, that he
has come to a sense of realization of the purpose of the task
he is doing. The aim of the lesson should, therefore, be stated
at the beginning of the lesson, and everything considered
should be shown in the light of the realization of the aim.
Not that it is necessary for the teacher to stop at every teach-
ing period to show the pupils the purpose of the topic of that
particular period. Where such purpose is obvious it need not
be stated, but at various stages in the lesson there should be a
kind of summary, to bring the student to a realization that the
purpose which he had in mind is being carried out.
(3) The development of the lesson should proceed from the
concrete to the abstract, and from the known to the unknown. —
This principle is a concrete expression of the doctrine of
apperception, which plays a very prominent part in educa-
tional psychology, and which teaches us that a person's pre-
vious knowledge must be brought to bear on the new fact,
in order to assimilate it. It is also the principle which has
given such prominence to the method of induction in teach-
General Principles of Method 77
ing, especially in the development of the principles of a
lesson.
All scientific subjects — and accounting is one of them —
include a number of laws and principles. These represent
the organization of facts in a systematic way. Moreover,
this systematization of facts gives rise to principles which
are appHcable in the interpretation of new facts. No mis-
take in teaching is more common than the presentation of
an abstract rule to the pupils, the meaning of which is not
understood ; and the assignment of a series of concrete prob-
lems in which the pupil is required to apply this rule. In this
way the student of bookkeeping is asked to note a certain
rule for journalizing, and then required to apply the rule to a
particular business transaction. This procedure reverses the
order which the good teacher ought to follow. The only way
in which to make a rule intelligible is to show the pupil how it
is derived. We must begin with the particular facts which
have to be organized. These facts are concrete, but their
true meaning is not clear until they have been related to other
facts in the pupil's experience. This relation takes place
by means of the general rule. The method by which we
develop the rule from the particular facts is known as the
" Method of Induction," and its advantage Hes in the fact
that the pupil, as he learns how to organize facts, also learns
how to apply the principle of organization to the new problems.
This he is able to do, because the rule is not an abstract formula
thrown at him, but a principle, the form of which he has devel-
oped by his own effort.
The principle of proceeding from the known to the unknown
and from the concrete to the abstract, leads to the use of all
those concrete methods Hke pictures, maps, observation trips,
etc., that are so necessary as an aid in bridging the gap between
yS Principles and Methods in Commercial Education
the limited experience of the pupil and the larger experience
which we want him to obtain. How could the pupil without
these aids ever come to reaUze the larger world in which he
lives, the world of other cUmes, other industries, other habits
of living, other types of thinking? While all teachers use
concrete material, nevertheless there are certain mistakes
made in the use of such concrete material. Some of these
mistakes are as follows : (i) The use of this concrete material
as illustrative of the abstract rule, and making the abstract
presentation follow rather than precede the illustration.
(2) The presentation of the concrete material as a mere diver-
sion, instead of the utilization of it as a step in arriving at the
abstract. This mistake is made when the teacher presents
pictures, specimens, and experiments which interest and enter-
tain the pupils, but which fail of any educational purpose,
because the teacher presents this concrete material without
any discussion or relation of it to the general principles dis-
cussed. (3) The rehance upon certain concrete aids when
the student's mind has outgrown the necessity of those aids.
This is not a very frequent error made, but it exists never-
theless. It is the same mistake which we would be making
if we drove a baby in a carriage after he had learned how to
walk. The use of concrete aids will be found illustrated in
connection with the discussion of Aids in Commercial Geog-
raphy.
(4) Drill and the Principles oj Habit Formation. — The knowl-
edge of a rule should be developed, as we have seen, from a
study of particular examples. But while the purpose of a
general principle is to organize the facts which we know, it
has still a larger purpose, namely, to serve as a means by which
we can interpret new facts which are similar to those we
know. The rule itself is of little advantage unless it gives
General Principles of Method 79
us the power to solve all the new difficulties that may come
up. But as the understanding of a rule is one thing, and the
acquisition of skill in the application of the rule is another,
, the development of the general principle must be followed
by practice in its application to numerous examples. It is a
common experience to find that in spite of our greatest efforts
in developing a subject rationally, in spite of the fact that the
students have followed the discussion of the topics in a most
intelligent manner, that, nevertheless, the results of the teach-
ing are not permanent ; and thus we find that, in spite of our
great efforts, we seemingly have accomplished little in the way
of tangible results. The cause of this failure is due to lack
of practice and drill. The purpose of drill is to give the stu-
dent judgment in the application of principle to new facts,
skill in seeing that a certain problem is to be solved in a cer-
tain way, and quickness and unerring accuracy in its solution.
We know what arithmetic would be without numerous exam-
ples for the students to practise on. We realize how ineffective
our teaching of accounting would be if it were confined to a
mere discussion of principles, without the opportunity on the
part of the student to solve problems.
But there are certain subjects which require drilling to a
greater extent than other subjects. In certain studies we
want to develop such a degree of skill that the pupil will be
able to solve the problems immediately, and without the
slightest reflection. We may call such subjects habit sub-
jects, and the principles underlying habit formation we shall
note very briefly below. There are other subjects in which
the organization of facts studied is perhaps more important
than the application of those principles to other facts. One
of these subjects is commercial geography. In this subject
our aim is to give the student an organized view of the factors
8o Principles and Methods in Commercial Education
that condition commercial activity in the world. Of course,
the purpose of the study is to give the pupil the abihty to
interpret a new situation as it arises, in the light of that prin-
ciple, but the main purpose is to give the student a systema-
tized view of the world's activities. Drill, therefore, plays
some part in this subject, but organization — and by this we
mean organization by the pupil and not by the teacher or the
text-book — plays a much more important part.
In commercial law, on the other hand, there is very little
time to develop the principles of law. The aim is not ex-
actly the organization of the student's legal knowledge, but
the ability to apply a general principle of law to a particular
state of facts. Hence, in commercial law, application or
drill is a much more important factor than in commercial
geography. To make the knowledge of principles dynamic,
so to speak, we must give the students numerous cases —
problem cases — to solve. The value of a knowledge of
general principles as such is very slight. Even in our exam-
ination in commercial law we realize that fact, when we
give an examination paper composed entirely of problems.
To illustrate further : An examination in arithmetic does not
consist, in great part, of questions on rules, but is given up
almost entirely to problems to be solved. Similarly, an
examination in commercial law does not require the student
to give a general statement of rules of law applicable to a
large topic, but requires him to apply his knowledge to
particular cases. Hence, intelligent drill, drill in which the
student has to re-think the particular rule of law, in order
to see how the rule applies to the facts, is the kind of drill
that is most efficient in this subject.
Again, there are subjects in which the presentation of the
rule furnishes no difficulty at all, subjects in which the knowl-
General Principles of Method 8i
edge of the rule as such is of practically no importance.
These are subjects in which the student is asked to accomplish
a certain technical task. We refer to the habit subjects. In
this class, we include stenography, penmanship, and certain
phases of arithmetic and bookkeeping. These are subjects
in which mechanical accuracy is the important requirement,
and in which it is considered a deficiency for the student to
have to stop to think over his problems instead of coming
to an immediate decision about them. Stenography is a sub-
ject in which the student is asked to apply general principles.
The principles themselves are very simple, but the appli-
cation of them, with accuracy and speed, is a matter of prac-
tice.
Hence, the great problem in these subjects is, how to de-
velop mechanical accuracy, and not how to develop a knowl-
edge of the principle. The development of speed is a matter
of practice or drill. The understanding of the principles
in stenography is so simple that we do not, as a general rule,
expect the teacher to develop the knowledge of it inductively
in connection with this subject. But as teachers, we use the
greatest amount of skill to develop in a student the habit of
applying the principle unerringly and rapidly. The power
to do so is something that can only be developed by constant
practice. But practice alone is not sufficient to develop the
skill. There must be certain other considerations kept in
view to develop this unerring accuracy. This leads us to a
consideration of the principles of habit formation.
Assuming that the student knows the rule, there remains
the problem of how to lead him to apply this rule and how to
train him in the unerring and rapid use of it. First, there
must be the incentive which will lead him to pursue his task
with interest. Dull and deadening drill will not give that
82 Principles and Methods in Commercial Education
incentive which will lead to practice with a good will. It is
for that reason that good teachers in stenography introduce dic-
tation at the very beginning of the subject in order to make
the students feel that they are actually taking dictation, and
in order thus to give them the incentive to do their work well.
Of course, misdirected practice at the stage of the development
of habit will lead to the formation of wrong habits, which it
will take a good deal of time to eradicate. The development
of bad habits comes at the formative stage of the subject.
In order to prevent the formation of bad habits, the teacher
must be watchful to the highest degree. As long as the par-
ticular work to be done still requires deliberation, it is a sign
that a habit has not yet been formed. If the student has to
think how he is going to debit or credit a certain item, he has
not yet developed that mechanical proficiency which is so
essential.
It is at this stage in the process of the development
of a habit that the teacher must be watchful. When the
student is able to do his thinking quickly and without the neces-
sity of reflection, then the teacher's vigilance may relax, be-
cause the habit of doing the work correctly has already de-
veloped, and there is Uttle danger of the student's relapsing
into a bad habit. Thus, if the student has got into the habit
of muscular movement in writing, it is no longer necessary
to watch him in order to see whether he is actually using the
muscular movement at all times, because it is more natural
for him now to write in the correct way, — the habit of doing
so has developed. The objection may be made that it is
not desirable to try to develop such mechanical accuracy
that the pupil will dispense with the necessity of thinking.
In certain subjects, however, such a proficiency is absolutely
necessary. Even in arithmetic, we want the pupil to develop
General Principles of Method 83
such mechanical accuracy in his fundamental operations that
when he solves the more complicated problems, he can give
his undivided attention to the higher aspects of the work and
leave the mechanical aspects of the work to his subconscious
self, to habit. In bookkeeping, too, we require the bookkeeper
to be unerring and rapid in his ability to decide whether a
certain transaction is to be debited or credited. This effi-
ciency will leave his mind free to devote his attention to the
more difficult problems.
(5) Formal Steps of the Recitation. — In connection with
the special method of conducting a recitation, we hear con-
siderably about the so-called formal steps of teaching. There
is no room here to consider them at length. The five formal
steps are preparation, presentation, comparison, generalization,
and application. They are an excellent guide to the teacher
in the arrangement of his material, and in calling his attention
to the correct principles of teaching which ought to be fol-
lowed. Thus, preparation calls the teacher's attention to
the fact that he must base all his new knowledge upon what
the pupil already knows, that' he must prepare the pupil's
mind to receive the new by gathering up the related old
knowledge. Presentation, comparison, and generalization
call the teacher's attention to the fact that he must use the
inductive method in developing the principle. Application
calls the teacher's attention to the necessity of practice and
drill.
As an illustration of the five formal steps, we may take
the lesson on posting from the Cash Book. The preparation
element would be the journalizing of the Cash Book items
and the review of the method of posting from the Journal.
The presentation would be the giving of the items as they
appear in the Cash Book, and the statement of the problem :
84 Principles and Methods in Commercial Education
How to post. Comparison would involve the comparison
of the items in the Cash Book with the place in which they
would appear in the Journal and in the Ledger. This would
lead to the generahzation that the posting items on the
debit side of the Cash Book arc credit items in the Ledger,
and the posting items on the credit side of the Cash Book
are debit items in the Ledger. After this generalization,
the student is ready to post directly from the Cash Book with-
out the necessity of first transforming the Cash Book item into
a Journal entry. This is the application or drill step.
While the formal steps are important, they must not be
slavishly followed. We must not try to fit our lesson into a
Procrustean bed. As long as the formal steps help in the
development of the lesson, they are to be used ; but if we make
them the master instead of the servant, we paralyze our own
efforts. It may be that certain lessons require the presentation
stage before the preparation stage; it may be that certain
other lessons require a Httle appUcation before generalization.
The teachers will have to decide the particular fitness of the
steps to the lesson in hand. There are certain lessons, however,
in which the attempt to fit the development of the subject
into the formal steps is a failure. This is true of those sub-
jects in which application or drill is the most prominent part.
The purpose of the formal steps, principally, is to call the
attention to the necessity of developing the rule in a rational
manner so that it can be intelHgently applied. Where the
ordinary appHcation of the rule is easy, because the rule is
simple, the formal steps are of no use. This is true of the
habit subjects. In a subject like Commercial Law, too, the
application stage is the most important, and to give equal
attention to the other four steps is a waste of time. Never-
theless, one principle must not be lost sight of even here, and
General Principles of Method 85
that is, that we must begin with the concrete fact, and lead
the pupil to see the necessity of the rule.
We may generalize on the subject of the formal steps by
saying that where the subject is of a scientific nature, the
formal steps are of great help ; where the subject is one involv-
ing technique or habit, the formal steps are of little value.
Further illustration of the principles of teaching as applied
to the different subjects will be treated in connection with
the separate subjects. But one principle which has been
heralded as something new, especially by certain teachers of
bookkeeping and stenography, must be mentioned in closing
this chapter : individual instruction.
(6) Individual Instruction and its Limitations. — The class
method of instruction, — by which we mean the method
whereby the teacher instructs all the pupils in his class as a
body, — while it has great advantages in the way of economy
and efficiency, also has serious disadvantages. First, it
emphasizes the subject to be taught rather than the indi-
vidual instructed ; secondly, it leaves out of consideration
certain individual differences in abihty of students in the
class. Where the latter have been absent, or have entered
school late, there is little opportunity for them to adapt
themselves to the work in hand, so as to make up their loss.
The consequence is a serious waste of time. For this reason
the demand has arisen in our school for some form of individual
instruction, some method by which the subject to be taught
may be adapted to the needs and abilities of the individual
students. While our system of grading takes into considera-
tion the degree of attainment of the members of the class,
it loses sight of the fact that certain individuals, starting at
the same level, may, nevertheless, progress at different rates ;
and that after a few months we may find some students be-
86 Principles and Methods in Commercial Education
hind others, owing to absence, illness, slowness, or other
causes.
To remedy these defects, it has been proposed to adopt a
method of instruction, which, for want of a better term, we
may call " the individual method of instruction." This
method is largely in use in business schools, especially in con-
nection with the subjects of bookkeeping and stenography.
Those who have adopted it have done so for practical reasons.
They have been compelled to admit students at various times
during the year ; so that the class method of instruction has
become, if not impossible, at least prohibitive, because it
required the organization of a new class for every small group
of entering pupils. Paradoxically, therefore, we might say,
they have adopted a method Vhich increases, to a still larger
extent, the number of classes, by making each entering pupil
a class in himself.
Unfortunately, this method has resulted, not in the organiza-
tion of a method of individual instruction, but in the estab-
lishment of a system in which the teacher docs little except
check up the work of the pupils. It has its advantages in
stimulating the self-activity of the pupils, but it gives no oppor-
tunity for good teaching, as such. It is impossible to expect the
teacher to give a model lesson to each pupil. Such a method
would involve a tremendous waste of time and energy. Conse-
quently, the other extreme is adopted, and no instruction, in the
technical sense, is given at all ; the instruction given being
merely a form of study, under supervision, with occasional
oral recitation, such as is found in the ungraded country school.
Such a method of individual instruction is a sham and
delusion. It allows no opportunity for the cooperation of
class and pupils for the development of a topic, little oppor-
tunity for emulation, and no opportunity for one pupil to
General Principles of Method 87
learn by the mistakes of others. It is almost criminal, there-
fore, for a teacher dehberately to abandon the class method
of instruction and resort to the method of making each indi-
vidual a class by himself.
The disadvantages of class-room instruction, however,
must be met ; and the question arises whether there is any
way by which the good of class-room work may be preserved
and the evil features eliminated. There is such a method —
the so-called '' group system of instruction." It is possible
for a teacher to organize his class into two or three groups
so as to allow for the different rates of progress, and for their
loss of work owing to absence and other causes. In such a
system, one group should be instructed with all the methods
and devices of the skilful teacher, while the other group should
be studying and applying the lessons taught. During the
next lesson, the groups would shift, the studying group being
instructed while the group instructed before would be study-
ing. If the objection is made that two or even three groups
will not allow for a sufficient adaptation to individual abilities
of students, it must be said, on the other hand, that some in-
centive should be furnished the students to accelerate the
rate of their progress, and this individual instruction does
not and group teaching does give. If pupils can progress
at any rate they please, and if no standard is set which they
must attain in a given time, they will exert no effort. In
the group method the slower pupils will make a special effort
to get into the higher group, and if the backward pupils are
even slower than the slowest group, they can be shifted into
the highest group of the class below, or given individual in-
struction after the regular hours. The group system, then,
to sum up, combines all the advantages of class-room instruc-
tion with the advantages of individual instruction.
88 Principles and Methods in Commercial Education
SUMMARY
The purpose of this chapter is to show how the general
principles of teaching have their particular application in the
teaching of commercial subjects. The following principles
are considered :
(i) Teachers' knowledge of the subject. A teacher must
have a broad knowledge of the scientific and cultural back-
ground of the subject he is teaching. He must constantly
supplement his knowledge by reading along the lines of the
latest advances in the subject, and take advantage of post-
graduate or extension courses.
(2) Principle of self-activity. Teaching consists not in
lecturing, but in stimulating students to effort and self-activ-
ity. The teacher should lead pupils to master problems by
their own effort.
(3) Interest and purpose. The realization by the student
of the purpose of what he is doing leads to the elimination
of much effort. In general, no new topic should be intro-
duced by the teacher without making the student feel that it
satisfies a definitely felt need.
(4) In general, the abstract rule should be developed from
the study of concrete examples, and the apperception of the
pupils kept in mind.
(5) Drill and habit formation. Drill is of very great
importance in making the results of the lesson permanent.
It is of especial importance in technical subjects like stenog-
raphy and typewriting.
(6) The formal steps of teaching, as presented by the Her-
bartian school, are of value as a guide to the technique of
lessons in which the aim is the development of the principle.
They are of Httle use in subjects in which the drill phase pre-
General Principles of Method 89
dominates, like typewriting, or in which the aim is the develop-
ment of appreciation of a topic as a whole, like EngHsh or
history.
(7) Individual instruction in a class has its uses in connec-
tion with backward pupils, but it should not be made an excuse
for no class teaching at all. The group system combines all
the advantages of class-room instruction with the advantages
of individual instruction.
EXERCISES
GROUP ONE
1. Why is it not sufficient to study general principles of method in
order to insure success in teaching commercial subjects ?
2. Outline the knowledge of his subject which you would expect
of the commercial teacher. How can he keep his knowledge up to date ?
3. Explain the importance of the principle of self -activity, illus-
trating by reference to both a technical and an intellectual subject of the
commercial curriculum.
4. Illustrate what is meant by proceeding from the concrete to the
abstract in (a) commercial geography, (6) stenography, (c) economics,
(d) business practice.
5. In which subjects of the commercial course is the element of habit
formation most prominent ? Give the steps in habit formation.
6. What is meant by the formal steps of teaching? Illustrate by
means of a lesson in bookkeeping.
7. What are the uses and abuses of individual instruction ?
8. Differentiate between induction and deduction. Show that the
teaching process involves both induction and deduction.
GROUP TWO
1. Prepare a bibliography on methods of teaching the various subjects
included in the commercial high school. In a brief sentence, state the
value of each reference.
2. Arrange a summary of the principles of pedagogy which should
90 Principles and Methods in Commercial Education
prove of aid to the young teacher in the preparation of his daily lessons
and in the conduct of his recitations.
3. Write out a criticism of a lesson in bookkeeping which you have
observed, basing your comments upon the principles presented in this
chapter.
BIBLIOGRAPHY
Bagley, W. C, Educative Process. New York, Macmillan Co., 1905.
Butler, N. M., Meaning of Education. New York, Macmillan Co.,
1909.
Farrington, F. E,, Commercial Education in Germany. New York,
Macmillan Co., 1914.
HoRNE, H. H., Psychological Principles of Education. New York,
Macmillan Co., 1906.
James, W., Talks to Teachers on Psychology. New York, Holt & Co.,
1912.
Klapper, p.. Principles of Educational Practice. New York, Appleton
& Co., 1913.
McMuRRY, C. A. AfJD F. M., Method of the Recitation. New York,
Macmillan Co., 19 10.
RowE, S. H., Hahit Formation and the Science of Teaching. New York,
Longmans, Green & Co., 1910.
PART TWO
SPECIAL METHODS IN COMMERCIAL
EDUCATION
CHAPTER IV
Business Arithmetic
importance and difficulties
It is scarcely necessary to explain the importance of a
knowledge of arithmetic to the business man. It does, how-
ever, require some explanation why we should include it in
the curriculum of the secondary school after an eight years'
course in the elementary grades. There are at least two
narrowly practical reasons for this: (i) The constant com-
plaint of business men that graduates of the elementary school
are deficient both in performing simple operations, as well as
in ability to apply their knowledge to the solution of practi-
cal problems that arise in the office ; (2) this deficiency tends
to hamper the teacher of those business subjects which involve
arithmetical operations. These two reasons might, of course,
prompt us to seek a remedy in the direction of improving the
elementary school course, and this is being done in most of
our large cities. On the other hand, the teacher in the sec-
ondary school must face the situation as he finds it, and try
to supply some of the deficiencies. This involves the inclu-
sion of business arithmetic in the secondary course.
91
92 Principles and Methods in Commercial Education
There still remain several specific reasons why commercial
arithmetic could legitimately find a place in our course, even
if the results in the elementary schools were proportionate
to the effort expended. Business arithmetic is, in a sense, a
vocational subject. In its treatment in the commercial
school, correlation with business practice, bookkeeping and
accounting, is constantly kept in mind. The point of view
is, therefore, more advanced than that in the elementary
schools. Moreover, the teacher profits, or ought to profit,
by the student's knowledge of algebra, in order to give the
principles that are learned a more rational, a more scientific
foundation.
To get the proper perspective of the subject in connection
with secondary school work, and to solve some of the prob-
lems of method, we must consider some of the deficiencies
as revealed by the failures of elementary school graduates.
These are lack of accuracy in the fundamental operations
and fractions, and inability of the students to apply their
knowledge to practical problems that require some reasoning.
We might add lack of speed as another element in the defi-
ciency, but this point is not so vital as the other two. Our
commercial teachers, realizing this deficiency, take the attitude
that the way to supply the deficiency is to give more work
in arithmetic. If eight years of a study are not enough to
turn out efficient students, perhaps one or two extra years
in the high school will repair the deficiency. Instead of
examining where the shoe pinches, — whence the failure in
the elementary school proceeds, — they serenely pursue their
own way, pretty much along the lines of the teacher in the
elementary school. This, we believe, is not the proper way
to meet the situation. We must examine into the probable
causes of failure of the elementary school course in order to
Business Arithmetic q3
gain some useful lessons in how to do, or perhaps not to do,
the work in the high school.
PROBABLE CAUSES OF FAILURE, (i) The curriculum
in the elementary school covers too much ground. — The in-
dustrial and commercial appHcations of arithmetic form a large
part of the content of the work. Many of the topics are entirely
too complex for the student. They involve a certain knowledge
of business procedure and technique, which the limited amount
of time at the disposal of the elementary school teacher
makes it impossible to give to the student. The apparent
inability of the children to perform business problems that
require reasoning is due to the fact that they really have not
had sufficient opportunity to exercise their ability on problems
that are within the level of their knowledge and experience.
There is, therefore, a second cause which grows out of this first.
(2) Lack of practical work on the level of the experience
of the child. — If we want to teach children how to think,
we must give them exercise in thinking. We may find them
solving problems that involve a high degree of reasoning abil-
ity, and yet we may not be certain that they really have the
abihty to reason in arithmetic. Many problems in both dis-
count or profit and loss, for example, children may work
mechanically or by guesswork, without really understanding
the reason back of their work. Even if they superficially
understand the reason, they may forget it after a while, simply
because they are working in a field of business technique, with
which they are not sufficiently acquainted. Consequently,
they cannot retain what they have learned. It is a well-
known fact that a subject which is well thought out will be
remembered without any effort, and even if it is forgotten,
it will be possible to recall it with very Uttle review. Rules
connected with higher phases of commercial arithmetic, such
94 Principles and Methods in Commercial Education
as foreign exchange or investments, may be taught with
comparatively little expenditure of eflort, but the results
will be superficial.
When we say that there is a lack of practical problems in
the elementary school, we mean, therefore, that the problems
are not such as will stimulate the child's thought, as will
make him feel a sufficient interest in his work, as will make
him see that he is meeting or satisfying a real difficulty which
he feels. If our elementary schools devoted less attention
to commercial arithmetic, or rather chose a few topics in it,
and included a few more problems dealing with the experi-
ence of children, in connection with their games and with
geography and science, they would really develop the ability
of the children to attack arithmetical problems.^
(3) Insufficient drill. — The fault is again a consequence
of attempting to cover too much ground. Our schools have
done a considerable amount of work in mental arithmetic,
so-called, but they have failed, in a great many cases, to give
students accuracy and rapidity in the fundamental operations.
This deficiency is so evident to the commercial school that
rapid calculation drills play a very important part in the ordi-
nary course in commercial arithmetic in the secondary school.
Perhaps the lack of proficiency in this respect is also due to
the fact that teachers have tried to combine a training in
rapid calculation with the study of a process in arithmetic.
For example, in presenting a new case in arithmetic, they have
very frequently used complex figures for the purpose of " kill-
ing two birds with one stone," — namely, to teach the new
case, and give incidental drill at the same time. The result
was that the attention of the children was divided. It is a
well-known axiom among the most advanced teachers of
^ See bibliographical note at end of chapter.
Business Arithmetic 95
arithmetic, that the new principle should be presented through
the medium of round figures or simple figures. The use of
unusual numbers and large fractions distracts the attention
of the student from the process involved. It therefore gives
training neither in the process nor does it give drill in the
fundamentals.
Conclusion, (i) We must limit the ground to be covered
both in the elementary school and in the secondary school. —
It is very true that applied problems are of the highest im-
portance, but if an intelligent understanding of the appHed
problem requires an elaborate explanation of phases of busi-
ness that are of a specialized nature, the topic does not belong
to the course. For example, a certain real estate problem
involving the laying out of ground into lots may involve
very useful applications of a principle, but its consideration
may divert the attention of the pupils, and the comprehen-
sion of the problem may involve a discussion of certain practi-
cal phases that the limited time will not allow. If time is
taken for this purpose, it necessarily means that more essen-
tial topics have to be neglected. The student who has been
taught how to attack problems, — to whom difficulties have
been presented in a graded form, adapted to the growth of his
intelligence, — will be able to adjust himself to the particular
situation, when he actually comes to it in his business career.
It may be interesting in this connection to consider Dr.
F. M. McMurry's rules for the elimination of topics in arith-
metic so as to meet the difficulty due to the attempt to cover
too much ground. He considers that the following ought to
be eliminated from the course :
(c) Whatever does not answer some ethical, aesthetic, or utilitarian
need of the child ;
96 Principles and Methods in Commercial Education
(b) Whatever does not reasonably fall within the comprehension of
the child ;
(c) Whatever does not appeal to the interest of the child unless it
conflicts with "c," above;
(d) Whatever is isolated, irrelevant, or does not form one of a series
of related facts.
To adapt these tests for elimination to the secondary com-
mercial course, we must bear in mind the vocational character
of the arithmetic taught in the secondary school. We must
remember that the subject is not taught as an end in itself,
but rather grows out of the need of meeting the various
business situations as they arise, in so far as they involve
the measurement of value. Teachers have therefore met the
situation in arithmetic, — so far as training the student in
the ability to reason is concerned, — from the wrong end.
They have made business practice incidental to arithmetic,
instead of using arithmetic as an aid in the understanding
of business processes. The course in commercial arithmetic
has been abstract and unrelated to real business life, because
abstract mathematical phases have been made too prominent.
In the elementary school this difficulty is to a large extent
insurmountable, in view of the technical knowledge of busi-
ness which advanced commercial arithmetic presupposes.
The same thing might apply in the high school, if current
practice were to continue to include all arithmetic in the
first year of the course. In this way, elaborate preparation
is made for advanced business practice that is to follow, in-
stead of correlating more directly the arithmetic to be taught
with bookkeeping, accounting, and economics.
While a certain amount of arithmetic ought to be included
in the first year, there are certain portions that should be re-
served for the time when students are familiar with algebra
Business Arithmetic 97
and when they have a greater acquaintance with business
practice. This is in accord with a very important principle
in pedagogy, namely, that, as a general rule, no topic should
be presented until a need is felt for it. Carried to an extreme,
this doctrine would direct us to learn how to discount a note
when we actually have to do so in our work in bookkeeping.
It is not necessary to hold this doctrine in its extreme form.
Nevertheless, it points to this very valuable principle, that
when a certain topic, such as bank discount, is studied in the
first year, only its simplest phases should be considered. A
review of the topic in connection with bookkeeping will not be
time wasted, because the solution of the arithmetical problem,
even when it is a little more advanced than the one attacked the
year before, will be taken up with an interest that will grow
out of the realization of the practical value of the subject.
(2) Perfection in skill. — There is a second phase of
the subject of commercial arithmetic that, as we noted,
prompted us to include it in the secondary school course,
and that is the perfecting of the student in arithmetical skill
to manipulate figures. It is true that calculating machines
and arithmetical tables have eliminated a great deal of the
abstract arithmetic work, but calculating machines are not
of such universal use as to dispense with the necessity of skill
in operations on the part of the student. The invention of
the typewriter has not dispensed with the necessity of a good
handwriting, and neither has the calculating machine dis-
pensed with the need of rapid and accurate figuring. Arith-
metical skill is developed by intelligent drill. The principles
of conducting drill work and of developing good calculators
are so important, that some mention should be made of the
subject here. Ability to add, subtract, multiply, and divide
accurately is a matter of practice or habit formation. The
98 Principles and Methods in Commercial Education
teacher who wishes to solve the problem must face certain
practical difficulties : (a) How to carry over the skill which is
developed in abstract work, to practical problems, {b) How
to make the drill interesting. This is important, not only
for its own sake, but because mechanical drill which lacks in-
terest is very exhausting, (c) How to develop speed without
sacrificing accuracy, {d) How to give short cuts which the
student will use intelligently, and which he will remember.
These j)roblcms will all be attacked in the next section.
Development of Arithmetical Skill. — Skill, as was men-
tioned before, is connected with the mechanical phase of the
subject. In this section of our treatment we shall consider
means by which the secondary school can supply the defi-
ciency of the elementary school in this respect. While we
have mentioned this deficiency as second to that of inabihty
of the student to apply principles, we are taking it up first.
There are two divergent views with regard to the place of ab-
stract drill work in arithmetic. One is the older view which
insists that technical accuracy should be developed in con-
nection with abstract work, and that only when this accuracy
exists is it wise to solve applied problems. The more modern
view is that drill work should never be apart from more prac-
tical use. The advocates of this view say that abstract work
arouses no interest in the mind of the pupil, it is unrelated
to his other work, and satisfies no need. According to this
view, then, abstract drill work should never be conducted
apart from some practical or useful problem.
There is some truth in both of these views. It is un-
doubtedly true that mere abstract drill work is uninteresting
and fatiguing, but it is also true that to rely merely upon the
incidental drill that is obtained from the solution of practical
problems is to supply only inadequate exercise to the student.
Business Arithmetic 99
In the first place, a problem in which the attention is divided
between work in reasoning and work in numerical drill fails
completely to train either the ability to reason or the ability
to manipulate figures. Some mechanical drill work should
undoubtedly be conducted, so that when the students tackle
a problem requiring analysis, the manipulation of the number
work is automatic and the mind is left free to analyze, without
being distracted by complex figures.
There is, therefore, a middle view between the two extremes,
which accepts abstract drill work as a necessity, but tries to
make it as interesting, stimulating, and as useful as possible.
We shall now answer some of the problems connected with
drill, which were propounded in the precedmg section.
(a) How to carry over the Skill obtained from Drill Work
to Practical Problems. — The contention of those who are
opposed, in general, to mere formal work, is that the facility
gained from formal work is not carried over to the handUng
of practical problems. This is scarcely true, except where
other elements apart from the formal phase are involved
in the problem. Thus, if a person has learned how to add
a column of figures accurately and quickly, he will carry over
this ability to an applied problem. Of course, if he does not
know that the problem proposed to him is one which involves
addition of a column of figures, that is, where the figures
involve an arrangement of two columns, such as debit and
credit, his skill in addition will be of no avail, because he
will not have the opportunity to exercise it. This precaution,
however, we must take as a note of warning from those op-
posed to formal drill. Our abstract work must be of such a
nature as is commonly met with in real business Ufe. Thus,
addition drill is frequently limited to the addition of a column
of figures in which each line has the same number of digits. In
loo Principles and Methods in Commercial Education
bookkeeping we invariably have occasion to add amounts
which vary in the number of their figures. This kind of work
should, therefore, have its place in the drill work. Practice
in horizontal addition should also be included, because there
are so many practical uses of this kind of addition. Again
it may be that occasionally a student is required to add frac-
tions with very large denominators. Practically, however,
skill in manipulating common fractions with large denomina-
tors is of very Httle value, and the time spent in drill work
of this sort is wasted. When the opportunity arises to add
two of these unusual fractions, the practical calculator reduces
them to decimal fractions first, and then accomplishes his
addition with ease.
{h) How to make the Drill Work Interesting. — As we have
remarked before, long-continued drill is exhausting and unin-
teresting. But for a short time, the student finds abstract
work interesting enough for its own sake, regardless of the
ultimate purpose to which, in his mind, it may or may not
lead. The problem before the teacher is how to sustain this
interest long enough, to postpone the feefing of weariness
that will arise if the drill is too long continued. In written
work, such incentives as the setting of a time limit, the arous-
ing of emulation by the organization of rapid calculation clubs
or classes, may be of some effect. The introduction of some
purposeful end may also help in this regard. If the student,
for example, feels that his column of figures represents a total
which stands for some definite fact, Hke the total volume of
foreign commerce of the United States, his work wiU be of some
interest to him, beyond the mere calculation phase, because
he will be interested in the result from another point of view.
But after all that is said, we must avoid abstract drill
that is sustained too long. Perhaps the wisest plan is to
Business Arithmetic loi
have both short oral and written drill work in connection with
each lesson. As for devices which will add to the interest
of oral or mental arithmetic, those devices which have proved
interesting in the elementary school may be adopted in the
secondary school as well. The arrangement of the figures, in-
tegers as well as of fractions, upon the blackboard, in the form
of a dial plate of a clock, or on the rungs of a step-ladder, or
on the ties of a railroad track, tend both to add interest in
the work and to save time. The saving of time consists in
the fact that the figures do not have to be read, but merely
have to be pointed out on the board, and the answer follows.
(c) How to obtain Speed without sacrificing Accuracy. —
All business men realize that accuracy, above all, is essential in
arithmetical work. One mistake in the addition of a column of
figures may not be very material if the error is in the units'
place, but if the mistake is in the thousands' place, it is very
serious. Teachers should reject any answers in abstract work
which are not absolutely accurate. But how about speed?
This is undoubtedly desirable, and after reasonable accuracy
has been cultivated, efforts may be made to increase the speed.
The attempt to force speed too early leads to the development
of slipshod work. One of the ways in which speed is very
often checked is by the habit into which the pupil has got,
to read or whisper the separate numbers in his examples.
He should be taught to add two figures not by pronouncing
them separately and then stating their sum, but by giving
the sum of the two immediately after glancing at them.
(d) How to give Short Cuts which the Student will use intelli-
gently and which he will Remember. — The first commercial
education given in this country was by itinerant teachers,
who stopped at various places from time to time, and offered
instruction in penmanship and in short cuts in arithmetic.
102 Principles and Methods in Commercial Education
It is reported of these pioneers, that they were wont to startle
their audience by apparently phenomenal speed in addition,
multiplication, and division. They would thereupon proceed
to take enrolments for a course which would give the faciUty
the audience had just marvelled at. Needless to say, these
tricks — for such they were — were soon forgotten.
One who would seek a superficial reason for this forgetting,
would say that there was not enough opportunity to review
the short cuts. A thing which we have very little use for we
soon forget, and when the occasion arises when we need this
particular bit of forgotten knowledge, it is not available.
Therefore, one might say, review subjects constantly, even
though you have no immediate use for them, because a later
occasion might arise when they might come in very handy.
We believe that this remedy is very inadequate. The
reason why short cuts are forgotten is because there is no
rational foundation for them. They are remembered as a
mere device. The advantage of understanding the mathe-
matical principle upon which a short cut is based, is that it
helps us to reproduce the device whenever we require it. We
need not therefore be afraid of forgetting the short cut just
as long as we remember the principle back of it ; and the
latter is not very apt to be forgotten so soon, because it has
been apprehended by the reason and not by the mechanical
memory. What is this rational foundation back of the short
cut? It is the principles of algebra.
There is a general idea which rarely takes definite shape
in the minds of most persons, that somehow or other a study
of algebra enables us to understand our arithmetic very much
better. But many a student is disappointed when he finds
that the connection is not direct enough, and that he is unable
to apply his newly derived knowledge of algebra to his arith-
Business Arithmetic 103
metical problems. Hence he very often wrongly infers that
the study has been so much waste of time. His impression, it
is needless to say, is due to poor teaching of the subject and
the failure of the text-book constantly to make the connection
between algebra and arithmetic clear. The old-time algebra
(and some contemporary text-books are no exception) pre-
sents a number of unpractical examples, and rarely builds a
bridge between the algebraic process and the related arith-
metical process which is really based upon it.
We have recommended the introduction of algebra in the
course during the first year. We might go so far as to make
algebra and arithmetic a part of the same course, were it not
for the fact that arithmetic includes so many phases of busi-
ness practice, that the commercial teacher ought, properly,
to handle it, rather than the teacher of mathematics. But
the teacher of algebra should constantly give application of
principles to the solution of arithmetical problems, regardless
of the fact that pupils are studying arithmetic in another
class ; and the teacher of arithmetic should not hesitate to
use algebra as an aid in his work. It is one of the few bad
effects of speciaUzation in teaching that the speciaUst in one
subject considers work belonging to another subject outside
of his province. Whatever may be said about this attitude,
there should be a distinct effort toward cooperation and cor-
relation, where two branches are so closely related.^
Let us see how algebra aids the student in establishing a
rational foundation for his short cuts. We have room only
for a few examples. In order to multiply 52 by 48 we use
this short cut : Take the square of 50 and subtract from it
the square of 2 (which is the number by which 52 and 48
' Compare what is said on the subject of correlation between the depart-
ments of stenography and English on page 387.
I04 Principles and Methods in Commercial Education
respectively differ from 50), or subtract 4 from 2500, and the
result is 2496. This short cut is based upon the formula
{a -[- b) {a — b) = a- — 6^. The teacher of algebra should
apply this formula to a great many arithmetical examples ;
and, similarly, we expect the teacher of arithmetic, when he
comes to the topic of short cuts in multiplication, to famil-
iarize himself with, and to refer to, the algebraic formula.
Again, if we have to multiply a series of numbers by the same
number, and add the result, algebra teaches us that the short-
est way is to find the sum of the different numbers in the
scries, and multiply it by the common number. The formula
here is ab + ac + ad = a {b -\- c -\- d), therefore, 25 x 34 +
25 X 45 + 25 X 18 = 25(34 + 45 + 18) = 25 X 97 = 2425.
More will be said below on the subject of the importance
of the aid of algebra in the solution of difficult arithmetical
problems.
Artificial Aids to Calculation. — The ingenuity of man
has invented many devices for making the task of calculation
easy and unerring. Arithmetical tables, slide rules, and cal-
culating machines have been devised, and they have come
into very extensive use in business. The teaching of the use
of calculating machines is probably the function of the busi-
ness practice course, but the use of tables, such as multipli-
cation tables, simple and compound interest tables, wage
tables, etc., should be taught by the teacher of commercial
arithmetic. And some account of the underlying principle
on which the table was constructed should be given to the
student, so that he will be able to use it intelligently, instead
of automatically. The teaching of the use of tables probably
belongs to the advanced course in business arithmetic, because
it presupposes quite some knowledge of algebra. The slide
rule, for example, a device for making multiplication and
Business Arithmetic 105
division easy, is based upon the principle of logarithms ; the
intelligent understanding of a compound interest table also
involves a knowledge of algebra. Of course all these tables
can be taught mechanically without algebra.
Special Drill Class. — Those who still insist that a con-
siderable amount of time in the course should be devoted
to mechanical drill work, because a proportion of the stu-
dents show a deficiency in that respect, fail to take a correct
point of view regarding the remedy. If the rational drill
work recommended still fails to reach a number of the stu-
dents, the remedy is not to inflict more mechanical drill
upon the class as a whole, but to organize the deficient pupils
in special supplementary classes. It is wrong to inflict a
lot of mechanical work upon an entire class, because a few
show a deficiency in the manipulation of figures. This spe-
cial drill class would be outside of, and supplementary to, the
regular class work, and not a part of the regular curriculum.
A similar principle should prevail in penmanship. Even if
as many as one-half of the pupils show marked defects in
penmanship, it is no reason for putting in more work in pen-
manship as a regular part of the curriculum. The deficient
pupils should do supplementary work of a nature analogous
to that of the deficient pupils in arithmetic.
Applications of Algebra to Arithmetic. — There is no more
difficult subject in arithmetic for the teacher than the teach-
ing of so-called " reading problems." Many practical devices
have been used by the teacher, some of which have been very
effective. The method of requiring an approximate answer,
or at least the denomination in which the answer will be, is
very useful because it avoids some of the ridiculous errors
which pupils make. Another device that is very commonly
used is to require each pupil to analyze the problem by asking
io6 Principles and Methods in Commercial Education
himself what is given and what is to be found. It would be
better to reverse the order in which these questions are
asked, by requiring him to tell what is to be found first, and
then to put the question, What is given which will help us
fmdit?
Another device which we have not seen suggested in any
text is to require pupils to construct their own problems and
to solve them. This will be of great advantage in bringing
business practice and arithmetic in closer relation, because
the problems the pupils will construct will have to stand the
test of probabihty. If they present grotesque figures or
untrue business situations, their problems will have to be
rejected ; and criticism along these Hnes of some of the
problems brought in by pupils will be of considerable value.
In this way, we believe the pupil will have a better realization
of the meaning of the problem — because he will have had a
part in the making of it — than if a problem is presented to
him ready-made.
But the most important aid to the solution of applied
problems is algebraic analysis. By the use of algebra, some
of the most difhcult arithmetical problems are made ridic-
ulously easy. It is almost a crime to compel students to go
through cumbersome arithmetical analysis in order to solve
their problems, when algebra points an easy way. The fol-
lowing are some of the applications :
(i) X. — The use of x as the number to be found enables
us to convert all indirect cases of percentage to direct cases.
Thus, to find the cost, having given the gain or loss : If we
call X the cost, we can apply the basic rule used in the direct
case of profit and loss ; namely, multiplying the cost (x) by
the rate of gain or loss to find the actual gain or loss. This
points to the most valuable application of algebra to arithme-
Business Arithmetic 107
tic, — the ability which it gives to consolidate all the cases
of percentage into a single case, with the consequent saving
of the memory. This point we shall consider in connection
with the use of formulas.
But before doing so, we wish to show difficulties the teacher
of arithmetic has to solve in indirect cases of percentage by
means of arithmetical analysis, and the confusion which such
an attempt is apt to cause in the pupils' minds. Thus, we
call the cost 100%, which it actually is not, when we might
just as well call it x. We add the rate of gain, say 25%, and
call the selUng price 125%. But our difficulty only begins
now, when we say that 125% equals $250.00, and 1% equals
-^ of $250.00. The pupil is Uable to think that it ought to
equal i % of $250.00. The method of arithmetical analysis
thus causes confusion in his mind. Algebraically, he will
solve the problem by putting down an equation x - ^x =
$250.00. As he has learned how to clear of fractions, he will
solve the problem with the utmost ease.
(2) Formulas. — The use of formulas is the greatest labor-
saving device in calculation. Formulas are extensively used
not only in pure mathematics, but in technical work, and
even in accounting. After all, the formula is only an abbre-
viated statement of a rule. It has this advantage, moreover,
that this abbreviated statement can be manipulated by
means of algebraic processes. Thus, we may take the for-
mula for simple interest, and manipulate it so as to derive
all the indirect cases. The advantage Hes in the fact that
only one rule will have to be remembered, instead of four
or five. To illustrate: The rule is: Interest equals prin-
cipal times the rate times the time. Stating this rule as a
formula by using letters alone, we have the formula, I = P X
RxT, or / = PRT. This formula can be used for all
io8 Principles and Methods in Commercial Education
cases of interest. If we wish to find the principal, having
given the other elements, we substitute in the formula for /,
R, and T, and solve for P.
The skilful handling of formulas requires the following
practice : — First, training in numerical substitution in alge-
])raic expressions, — training which the algebra teachers
should devote special attention to ; and secondly, practice
in using other letters for the unknown number besides x,
such as a, m, n, or p.
APPLIED BUSINESS PROBLEMS
We have indicated the vocational aim of business arith-
metic in the secondary school. One of these aims is attained
when the pupil has acquired skill to manipulate figures, and
has become acquainted with all the artificial aids to accurate
and rapid calculation. But there is another and perhaps
even more important phase of arithmetic, and that is, its
application to the solution of practical business problems.
We have seen that one of the serious deficiencies of the ele-
mentary school graduate is his inability to solve these appHed
problems. Some of the methods of attacking such problems
were indicated in the preceding section. Perhaps a more
definite analysis of some of the reasons for the student's in-
ability to reason out some of the problems may not be out of
place here, even though some of the reasons have already been
indicated. In discussing the sickness, it may not be inappro-
priate to indicate the remedy.
(i) The problem work in arithmetic is not sufficiently an
outgrowth of the business activities of the student. As we
said before, we will not be wrong if in this branch of the work
we make the commercial activity phase (of which the example
Business Arithmetic 109
is an outgrowth), primary, and the arithmetical part, second-
ary.^ A very important aid in this direction is the insistence
upon a certain amount of numerical work, with emphasis
upon the arithmetical phase of the work in such subjects as
bookkeeping, civics, or economics. An example in discount
which the student solves, because he is confronted with the
bookkeeping problem of a customer who has discounted his
bill and whom he wants to know how much to credit with, —
such a problem will appear real to the student. The little
digression from the bookkeeping work, which a Httle explana-
tion of the arithmetical phase of the problem entails, will be de-
cidedly worth while. Similarly, in civics, the students may
be given arithmetical exercises in working out the tax rate of
a community, based upon given figures of assessed valuation
and budget requirements. A student who solves this prob-
lem receives training not only in arithmetic, but also in civics.
We can readily see why the opportunities for the close
correlation of business activities and arithmetic are limited
in the elementary school. The pupil is not mature enough
to understand such intricate problems as those of foreign
exchange, insurance, etc., — not because he is ignorant of the
numerical phases of the work, but because his experience is
too limited to apprehend the technical functions, of which the
numerical work is a product. Even in the high school, some
of these problems have to be postponed to the third year,
or at least to a time when the student may have reached the
necessary maturity and obtained the prerequisite experience.
Empty definitions of business processes in connection with
the arithmetic course will not satisfy the requirement which
1 This point has been strongly emphasized by Dr. Thomas Balliet, Dean of
the New York University School of Pedagogy, in his lectures on Methods in
Arithmetic.
no Principles and Methods in Commercial Education
is imposed upon the teacher to bring the arithmetical problems
into vital relation with real Hfe. Some notes on how this
relation may be made in connection with topics in higher
commercial arithmetic we shall give in what follows.
(2) Another reason why the pupil is apparently unable to
carry over his ability to solve problems in arithmetic, when
the same problems confront him in real business, is because
the book problems are frequently so artificial and so out of
accord with, not to say contrary to, conditions in business
life. A standard example of this kind is the so-called fourth
case in commission problems. In this case, the agent is sup-
posed to get a certain sum of money which he is to invest,
after he deducts his commission at a certain per cent. Now,
this may be good practice in indirect cases of percentage, but
as it gives a wrong notion of how business is done, it should
not be allowed in the arithmetic, as it will only tend to con-
fuse the mind of the pupil when he handles actual problems
in commission, later.
TOPICS IN HIGHER COMMERCIAL ARITHMETIC
{a) Percentage. — The reason for mentioning this topic
as a branch of business arithmetic is because most of the frac-
tions in business examples are in the form of per cents. Be-
sides, the calculation of percentage, apart from the standard
commercial applications, such as discount, interest, etc., is a
necessary requirement in the construction of graphs. A
graphic comparison of different volumes of product requires
a reduction of the figures to scale. This can best be done by
reducing the figures to a percentage basis, and constructing
the table from these percentages. The teaching of percentage,
as such, involves absolutely nothing new, except the form of
Business Arithmetic m
writing. If the teacher emphasized the fact that a per cent
is only another form of writing a decimal with two places,
he would eliminate most of the difficulties connected with
percentage. If he further shows the importance of ha\dng
a common denominator for all fractions, for purposes of com-
paring their magnitude, he will bring out the economy of
reducing every fraction to a decimal of two places, because
then he will only have to compare the numerators in order .
to determine relative magnitudes of fractions. Thus, how
many can tell at a glance which is larger, ^ or f | ? As soon
as we reduce the two fractions to a percentage form, we find
that the first is 33 % and the second 34 %, and instantly we
can make our decision.
{b) Profit and Loss. — The student has some idea of the
meaning of trading, and this should be made the basis of the
presentation of the topic. The idea of profit as the wage
of the man who gets the goods from the manufacturer and
stores them until such time as the consumer will need them,
should be brought out. Since the term cost is so important
in this work, a distinction should be made between first cost,
or prime cost, and total cost. This distinction will be empha-
sized even more in the bookkeeping work. The main purpose
of the distinction in its relation to trading is to endow
the examples with a certain amount of interest and relation
to practical fife. In some Unes of business the selling price
is made the base, but this method is unscientific and really
unbusinesslike. However, in compliance with the growing
practice in the jobbing and retail trade to base the rate on
the selHng price, the teacher might assign problems in which
this base is used, but only after the class is well grounded in
the other method. Shall we consider the indirect cases of
the subject ? Certainly, the problem of finding the per cent
112 Principles and Methods in Commercial Education
gained as distinguished from the actual amount gained is
not one which satisfies mere idle curiosity. For example,
the man who gains $1000.00 on his sales may be in a good
condition, while the man who gains $10,000.00 may be on
the verge of bankruptcy. The only way to tell is to find what
per cent the gain is of the total cost. The indirect case in
which the selling price is given and we are asked to find the
cost is of very little value, except to enable a person to figure
approximately what an article selling at a certain price in a
rival store must have cost, assuming a certain per cent of
profit. The most important example from a business point
of view is to find what I must sell a given article for in order
to gain a certain per cent on the total cost ; and this problem
is only an application of the direct case.
(c) Commission. — This topic should also be introduced
by a short presentation of the work of the commission mer-
chant and agent, and the work he does for the community.
The reward for his services may be a salary, but more commonly
it is a percentage on sales, as an incentive for greater effort
on his part. In addition to the usual problems on the sub-
ject, the teacher should give the student the opportunity to
make an Account Sales rendered by the agent, using the data
of a given example. The so-called fourth case of commission,
which presents problems in which the amount sent to the
agent is stated, including both his commission and the amount
of the investment, should not be taught at all, because it is
contrary to business practice. The finding of the total sales
from the rate and the commission may be of value, because
it may satisfy the desire of the merchant to know the total
volume of business done by an agent, taking as a basis com-
missions paid to him and the rate.
(d) Trade Discount. — The reasons for granting discount
Business Arithmetic 113
should be discussed, as, for example, special concessions to
customers for buying large quantities, for paying cash, etc.
The reason for two or three trade discounts may thus be
^ brought out. The reason for artificial catalogue or list price
should also be considered. The indirect case — what must
I mark a certain article in order to be able to grant a certain
discount ? — may also be taught, even though it may reveal a
business practice of doubtful integrity. Thus, it may show
that certain merchants are in the habit of marking their
goods up, so as to be able to pretend that they are granting a
price concession.
(e) Interest. — The motive for interest should be developed
from a concrete instance of money lent ; the use to which the
borrower can put the money; the deprivation the lender
suffers and the risk he assumes. Hence, the latter is entitled
to compensation. The borrower pays for the benefit he de-
rives, and the lender is paid for his deprivation and risk. The
time element naturally becomes material, because the longer
the period of respective benefit or deprivation, the greater
the amount paid. An elementary discussion of the legal rate
and the term usury should also be included. Of course, this
subject is also considered in law and economics later on, but
an elementary discussion here is a good preparation for the
advanced subjects. The teacher should not omit to take ad-
vantage of a practical lesson which he can give to the students
on the inverse relation between a high rate of interest and the
safety of an investment.
In connection with methods of computing interest, the basic
method — multiplying the principal by the rate and the
time in years, in order to find the interest — should be given
first. It establishes the rational foundation for all the other
methods, and besides, the others are only short cuts of this.
114 Principles and Methods in Commercial Education
Again, the purpose is very conveniently stated in a formula,
and this formula is very useful in solving all the indirect cases
of interest. With regard to short-cut methods for practical
calculation, the sixty-day method is the most important, be-
cause it is the one most convenient for bankers, — but there
is no particular reason for insisting upon one method. If the
student has an intcUigcnt understanding of the rational foun-
dation of the short cut he uses, there is no objection to his
using it.
(/) Bank Discount. — The motive here is arrived at by
considering the needs of the manufacturer, who has to pay
out cash on account of goods he is manufacturing, in the form
of rent, labor, etc., before he receives any money for those
goods, and sometimes even before he has sold them. The
function of the bank and the place of credit have to be shown
in an elementary way. The manufacturer borrows money
from the bank, gives his promissory note, and pays the bank
for its accommodation. This payment is the discount which
the bank deducts in advance from the amount lent. The in-
struments of credit should be considered, the student should
be given practice in writing out such instruments, and in
discounting promissory notes ; first, those in which no interest
is mentioned, and next, those which are interest bearing. Most
of the examples should involve 30- , 60-, and 90- day notes, rather
than one-month, two-month, and three-month notes. Those
above 90 days are usually expressed in months. There
should be some correlation with law, at least to the extent
of explaining the meaning of " protest " and the legal effect
and the liability of indorsers. The indirect case of bank dis-
count, that is, finding the face when the proceeds are given,
should be used only to a limited extent because of its infre-
quent use in business. It may be important to the customer
Business Arithmetic 115
who wants to find out for how much he must make a note or
draw a bill in order to have a certain amount available. Cer-
tain phases of business practice, like the use of the draft for
collection purposes, and the bill-of-lading with draft attached,
need not be considered in the work in arithmetic.
(g) Stocks and Bonds. — This subject is related to the func-
tion which the large corporation fulfils in modern life. The
student is shown that the carrying out of great enterprises
involves large outlay of capital and the necessity for cooper-
ation of many persons. The stock certificate is an evidence
of a man's partnership in the enterprise, and his ownership
entitles him to profits known as dividends. The terms par
value and market value should be carefully distinguished,
and reasons given for fluctuations in the price of stock. The
broker, his services and compensation, and the function of
the stock exchange should also be explained. In connection
with the dividend, reasons should be given for computing
the rate of return on the par value and ignoring the market
value, as the corporation itself is not supposed to be concerned
technically with the price which its stock brings in the market.
The most important problem in investments is probably
the computing of the rate of return which a certain invest-
ment yields, and the making of comparison between the in-
come return of difTerent stocks. Again, the relation between
safety and interest return should be emphasized, especially
in connection with bonds. Many interesting problems along
this fine may be given, as, the comparative income return
of different railroad bonds, industrial bonds, city bonds, and
government bonds. Many interesting generalizations may
be drawn from this comparison, but to make the work real,
examples should be taken directly from newspapers, using
current quotations. It is absurd to take quotations from an
ii6 Principles iuul Methods in Commercial Education
old text-book, that arc entirely out of date, and draw any
generalizations on the basis of those antiquated figures. As
we indicated in the discussion of commercial geography and
the technique of commerce, the student should be taught how
to use the commercial and financial page of the newspapers,
as a valuable source of information. Of course, we must not
lose sight of the danger that a student may become interested
in stock speculation as such. It is the duty of the teacher
to warn the students that large returns cannot be expected
without running the risk of large losses, and that safety lies
in being conservative and expecting small returns.
{h) Partial Payments. — These examples are still included
in the course of study, although they are of very little use.
Partial payment notes are not very usual in business nowa-
days, separate notes being given for the amount of each in-
stalment. The reason is that the debtor cannot be absolutely
certain that the creditor has indorsed the amount of payment
on the note. If he fails to do so, there is a possibility that
he may be asked to pay a second time by a stranger to whom
the note might be endorsed. The examples given should be
confined to appHcations of the United States rule and the
instalments ought to be made payable at regular intervals.
{i) Compound Interest and its Applications. — The motive
here is the incentive to thrift in leaving interest in the savings
bank to draw interest again. Illustrate the possibility of such
a scheme, and the result of the accumulation for about thirty
years. As a rule, it is a waste of time to solve compound
interest problems by the long method. Either compound
interest tables should be used, or else problems should be
worked by means of the formula and wdth the aid of logarithms.
As the chief applications of compound interest are to such
problems as endowment insurance, annuities, and amortiza-
Business Arithmetic 117
tion, or in other words, to accountancy of investment,
the subject can be effectively considered only in connection
with the work in advanced algebra and advanced commercial
arithmetic. To the one who intends to make accountancy
his profession, this phase of the subject will be of the greatest
importance.
(/) Other Applications of Percentage. — There are two appli-
cations of percentage that are very closely connected with
government fmance, and that may also be reserved for the
advanced course in arithmetic.
(i) Taxes. — As a matter of fact, the lesson on taxes is
just as much a lesson in civics as one in arithmetic, and the
teacher of government loses an opportunity for correlation if
he fails to include in his course, problems in connection with
the budget and assessed valuation. The subject is to be
introduced by considering the fact that it costs money to run
the various activities of the government. This suggests
methods of obtaining the money. In answering the question
how much it will cost to run the government, we should take
an actual budget, using round figures. Since the property
holders pay the expenses of running the government on the
basis of what their property is worth, the matter of assessed
valuation of the property and the means of arriving at it
comes up. The tax rate for the city is determined and the
necessity of a uniform rate emphasized. Among the problems
to present, the most important are : How much will a certain
l^roperty have to pay in taxes ? What will be the net income
of the landlord, after he pays interest charges, taxes, and
insurance? Additional problems upon the budget include:
What per cent of the city's income is spent upon education ?
upon the police ? upon the streets ? Compare these different
rates and draw conclusions from this comparison. Figure
ii8 Principles and Methods in Commercial Education
out how much your landlord pays upon his property. Out of
what money does he pay the taxes? What part of the total
rent of the house does your father pay? What part of the
total tax does he therefore pay ? How much of the rent which
he pays is actually contributed to the city government
through the agency of the landlord?
(2) Customs and Duties. — This topic is also closely cor-
related with civics. The development would be along the
following lines: (a) The necessity of securing money to run
the government in Washington. (The necessity for a pro-
tective tarilT need not be brought in.) {b) The estimated
cost of running the government suggests a brief statement
of what the United States government does for us. The
ordinary study of the three divisions of the government, the
terms of congressmen, etc., etc., may be important, but it is
too barren for this purpose. Some concrete facts of what
the government does for the individual citizens should be
noted. A detailed discussion would belong to a separate
lesson, but here such topics may be considered as the work of
the government for pure food, its help to the farmer, the coin-
ing of money, the national defence, the pensions, etc., etc.
(c) The tariff schedule — ad valorem duties (specific duties are
practically unknown now) ; the consular invoice, (d) Prob-
lems involving duties. Comparison of rates of duties on dif-
ferent articles. Reasons for the diflerencc. (e) Miscel-
laneous problems, involving duties as an element in the cost
of an article.
(k) Foreign Exchange. — This topic is so closely connected
with economics that an explanation of the entire mechanism
of foreign exchange, including such topics as the rate of dis-
count, the gold export point, and related questions, might
be left to the course in technique of commerce or applied eco-
Business Arithmetic 119
nomics. If, at this stage of arithmetical study, the work in
that course has been taken up, it may be appropriately re-
viewed in the advanced commercial arithmetic. Such prob-
lems, however, as are connected with the conversion from one
money standard into another, and customs and duties prob-
lems involving this conversion, as well as that from the metric
system to our own system, may appropriately be given. In
the technique of commerce course, we expect the student
to understand the quotations as they are given in the news-
papers, and the work in arithmetic in this connection should
aid in this understanding.
The Course of Study. — A brief discussion of this is essen-
tial, because our curriculum presupposes two courses : an ele-
mentary one in the first year, and an advanced course in the
last year. The essential topics to be considered in the entire
course have already been mentioned at length. In this con-
nection it will therefore be necessary to treat of the distri-
bution of topics over the two years of the course.
In the first year, we must emphasize drill work in integers,
fractions, and denominate numbers, together with their practi-
cal applications. Among these are simple industrial problems
connected with carpeting, plastering, board measure, etc.
It has been suggested that a differentiation in the practical
appUcations ought to be made with classes of girls. Prob-
lems connected with domestic art and economy should have
an important place in such classes. Simple mensuration
should also be taken up in this connection, and not post-
poned to the time when the entire commercial arithmetic
has practically been completed.
The requirements of bookkeeping and business practice will
compel us to give the simpler phases of percentage, profit
and loss, commission, trade discount, simple interest, and
120 Principles and Methods in Commercial Education
bank discount, in the second part of the first year. A more
elaborate treatment of these topics may be left to the advanced
courses.
Should any of the topics enumerated above be considered
again in the advanced course in the last year? The best
authorities on the teaching of arithmetic are agreed that a
spiral course, one in which the work in lower grades is repeated,
from a more advanced point of view, in the higher grades,
is the most effective. Let us see what basis there is for be-
lieving that the effective conditions for spiral repetition exist
in the last year. First, there is the larger knowledge of algebra
which enables the student to apprehend the principles of
numbers, from their scientific foundation. Secondly, there is
a large body of business experience that enables the student
to take up effectively more difficult commercial applications
of percentage. Thirdly, there is a knowledge of geometry
which makes possible an intelligent consideration of men-
suration problems.
A course in the last year should, therefore, comprise numeri-
cal or drill work, with special relation to artificial labor-saving
devices, such as tables ; a more complete consideration of
short cuts than in the first year, with special reference to their
algebraic foundation. Besides a more complete treatment
of the commercial applications considered in the first year,
several other applications of percentage should be taken, such
as compound interest, investments, foreign exchange, and taxes
and duties. The arithmetic necessary to the accountancy of
investment, such as problems in amortization, annuities, etc.,
should receive special attention. In mensuration, we should in-
clude the metric system, together with more difficult industrial
applications. In girls' classes, problems connected with the
measurement of dress material should receive special attention.
Business Arithmetic 121
Special Methods. — There is very little to say about
special methods in this connection that has not already been
said either in Chapter III or in this chapter. In this con-
nection, it will only be necessary to make a few brief remarks.
Should the inductive method be used in commercial arithme-
tic in view of the fact that many of the topics have already
been presented in the elementary school? It should be used,
by all means, because it is the only concrete approach to the
subject, and because it brings out the better relation between
the concrete experience of the pupil and the numerical work.
Suppose this connection has been shown before? So much
the better. The task of building the bridge from the known
to the unknown will therefore be very much simpler. The
Herbartian formal steps lend themselves very nicely to the
presentation of the subject. In the preparation stage we
should emphasize motive or purpose. The stages of presenta-
tion and generalization do not involve much effort. The
stage of application is perhaps the most important one in
connection with drill, from the standpoint of results. We
omit detailed consideration of it here, because it has been
abundantly covered in the discussion of drill in arith-
metic.
We may add a few suggestions on aids and devices in the
recitation.
(A) The Subdivision of Difficulties. — The teacher is apt to
attempt to present too many points at a time, or to make the
mistake of presenting problems with unusual figures, the
manipulation of which divides the attention. The teacher
should have in mind the elimination of this fault.
(B) The Blackboard. — If the work in commercial arithmetic
is not primarily discipHnary, should the same amount of
blackboard work be insisted upon as in other branches of
122 Principles and Methods in Commercial Education
mathematics? This is a question which is sometimes asked,
but we fail to see why only certain subjects should monopolize
board operations. We favor a continuous, liberal, and varied
use of the board, for two reasons :
{a) the teacher can inspect more work easily, and
{b) students, especially boys, enjoy this kind of exercise.
Different problems may be worked by each pupil at one time ;
and at another those at the blackboard may be divided into
groups of three or four, so that though some are at work on the
same problem, the temptation to copy is minimized ; and
sometimes, in drill work, all pupils at the board might work
the same problem. If time permits, pupils are to explain their
own work, and members of the class encouraged to ask ques-
tions. Sometimes it is better for the instructor to explain
all or most of the work, because he can cover more ground.
The point is, that no fixed form should be adhered to, so as
to avoid " falling into a rut."
(C) Oral Work. — Much more oral work than the teacher
usually finds time for should be planned. The modern text
furnishes more examples than the old ones, and some few
special booklets are on the market. Every oral recitation
should be an exercise in good EngUsh, and to this end, a good
exercise consists of requiring statements from the pupils as
to how problems are to be solved.
{D) Diagrams. — We cannot too strongly urge the advisability
of utilizing the benefits which come from the illustrations sug-
gested by many of the problems of commercial arithmetic.
We see no objection to insisting upon rough sketches for all
work in practical measurements. Outside of the aid which
such drawings furnish to a better understanding of the prob-
lem, and the clearer visualization which such exercise pro-
motes, it is our experience that the boy who shows extreme
Business Arithmetic 123
signs of mental inertia will be encouraged to analyze examples
when he has become accustomed to " draw " them.
{E) The Text-book. — Before accepting a text-book, it is
necessary to make sure that it includes all that one considers
essential; it is easy enough to omit portions. We trust
that no teacher will fall into the error of the schoolmaster
who tried to teach cube root for no other reason than because
it was in the book. Inasmuch as the number of topics is
to be reduced, we are enabled to insist upon a larger number
of well-selected and well-arranged problems. As we realize
that modern arithmetic deals with business, and as it is often
difficult to obtain samples of forms referred to by the text,
we should select such books as show photographic reproduc-
tions of these very forms. The text-book should also give
problems that are real, and should eliminate such as are in-
consistent with business practice. One other point remains
for treatment. It is, whether to use books with or without
answers. We are familiar with all the objections against plac-
ing answers in the hands of pupils, but their advantage appeals
to us so greatly that we feel the abuses they may lead to can
be counteracted. But this is a question which may well be
left with the teachers themselves.
As to the use of a text-book in arithmetic, very little need
be said. The principal uses of the book are : to give drill
exercises, and to save time in the dictation of problems, and,
in the newer texts, to furnish illustrations of commercial
papers and forms not easily obtainable elsewhere. Finally,
the good text serves' to crystallize the classroom discussion
of a topic and affords the best medium for reviews.
(F) Teacher's Note-book.— The teacher will find it desirable
to set additional problems from time to time. Too often the
mistake is made of destroying these, as the occasion which
124 Principles and Methods in Commercial Education
called them into use has passed away. If, instead, they were
placed in a note-book, and answers attached, a surprisingly
valuable collection would develop in a short period of time.
What has just been said applies with even greater force to
examination problems. Again, an important source of addi-
tional problems, as we have shown, is the newspaper, and
many of the problems derived from this source can also be
preserved in the note-book for future use.
(G) Examination. — Nothing is more discouraging to the
pupils than a bad failure on a test. In arithmetic, formal
tests might come as frequently as once a month. If an
examination consists of live problems, two of them should be
easy enough to insure that almost every member of the class
can pass them. The other three should be more diflScult so as
to call for much higher ability. After all that is said of its
disadvantages, the examination in arithmetic is the greatest
aid to efficient results. It compels accurate and definite re-
sults, and gives the necessary opportunity for training in
rapidity of judgment. Besides, the examination in arithmetic
is free from the disagreeable feature of cramming, which is
one of the most objectionable phases of examinations in most
subjects.
OUTLINE INDUCTIVE LESSON IN ARITHMETIC
Topic: Interest
A. Purpose and Preparation.
(i) Motive : The occasions for borrowing money in
business life ; the use to which the borrowers can
put the money, the deprivations the lender
suffers, and the consequent compensation to
which he is entitled.
Business Arithmetic 125
(2) Preparation (General) : Definition of interest ; ele-
ments upon which amount of interest depends;
sum lent (principal), time, and rate ; reasons for
including these elements.
(3) Preparation (Arithmetical) :
1. Call attention of class to the fact that interest
is one of the apphcations of percentage,
because the rate is expressed in hundredths.
2. Have them find 5 % of $100.00, etc. What is
the interest on $100.00 at 5 % for one year ?
for one-half year, etc. ?
3. Develop the fact that interest examples are
ordinary percentage examples with the
element of time added.
B. Presentation.
1. Find the interest on $1.00 @ 6 % for one year.
Ans. S.06.
2. Find the interest on $1.00 @ 6% for 60 days.
Ans. (l of .06). $.01.
3. Find the interest on $1.00 @ 6% for 6 days.
Ans. (y5 of .01). $.001.
4. Similar problems with principal (base) as
multiples of $1.00.
5. Similar problems with time as multiples of
60 days.
6. Similar problems with time as multiples of
6 days.
7. Similar problems with time as fractional parts
of 60 and 6 days.
C. Comparison.
I. The class should notice that in problems of
the type
126 Principles and Methods in Commercial Education
a. the interest at 6 % on $200.00 for 60 days
is $2.00.
b. the interest at 6% on $200.00 for 120 days
is $4.00.
c. the interest at 6% on $?oo.oo for 30 days
is $1.00.
2. That all elements involved are the same except
the time.
3. a. That the interest changes with the time,
and
b. that the interest is easily obtainable
from the amount for 60 days.
D. Generalization.
1. To find interest at 6 % for 60 days, point off
two places.
2. To find interest at 6 % for 6 days, point off
three places.
3. To find interest at 6 % for a different number
of days, proceed according to i and 2
above, and modify answer.
E. Application.
Problems assigned to drill on principles just taught.
In connection with these problems, take up a fuller
discussion of such topics as legal rate, usury, risk
elements in loans, and comparison of high interest
rate with safety of an investment.
SUMMARY
Though at first it may appear surprising to include commer-
cial arithmetic in the high school course, a recognition of the
fact that the elementary school graduate requires additional
Business Arithmetic 127
training, and that the subject is distinctly a vocational one,
justifies this inclusion. An examination of the causes of fail-
ure in arithmetic leads to the estabhshment of the methods
that should be followed in order to assure success. One almost
insuperable difl5culty confronts the teacher who reaUzes that
it is not wise to attempt a treatment of all topics in arithmetic,
but that it is much better to emphasize selected divisions.
Professor McMurry's rules for elimination of topics are safe
to follow.
The high school teacher aims to inculcate accuracy, speed,
and ability to tackle new problems. Accuracy and speed sug-
gest inteUigent drill ; abihty to tackle new problems, a thor-
ough understanding of the subject. In connection with carry-
ing out this latter aim, the applications of algebra are most
useful.
The high school work in arithmetic serves to throw addi-
tional hght upon the subjects of business practice and civics.
As a matter of fact, very frequently the lesson is rather one in
civil government or business practice than in arithmetical
drill.
EXERCISES
GROUP ONE
1. How would the elementary school treatment of bank discount
differ from that of the high school ?
2. State your objections to including cube root as a part of the high
school course in arithmetic. Justify your stand.
3. Why is algebra advocated for commercial pupils in the high school ?
Discuss fully.
4. Discuss the pedagogic advantages which accrue from the employ-
ment of formulas.
5. With the limited time at your disposal, how would you provide for
suflBcient drill in business arithmetic ?
128 Principles and Methods in Commercial Education
6. What principles would guide you in selecting topics for the high
school course in commercial arithmetic ?
7. Stale what devices you would employ in order to make drill work
interesting.
8. Justify the offering of commercial arithmetic in the high schools.
9. Show how the course in arithmetic may be correlated with the work
in civics and business practice.
10. *\Vhat is the value of the examination in commercial arithmetic?
What principles would guide you in preparing an examination pajxir ?
GROUP TWO
1 . Criticise the ordinary course in commercial arithmetic, and suggest
changes which would make it of greater service to high school girls.
2. Prepare a detailed syllabus for the first term of the high school.
Justify your selection of topics and their sequence.
3. Outline a model lesson in commission, suitable as a type to be
followed by the teachers of your department.
4. Prepare notes on a series of six one-hour conferences with begin-
ning teachers of business arithmetic.
BIBLIOGRAPHY
Byrnes, Richman, and Roberts, PupiVs Arithmetic, Books V and VI.
New York, Macmillan Co., 1913.
Coleman, S. E., Algebraic Arithmetic. New York, Macmillan Co., 1897.
Moore and Miner, Practical Business Arithnetic. New York, Ginn &
Co., 1906.
Thurston, E. L., Business Arithmetic for Secondary Pupils. New York,
Macmillan Co., 1913.
Van Tuyl, G. H., Complete Business Arithmetic. New York, Amer.
Book Co., 191 1.
Young, J. W. A., Teaching of Mathematics in Elementary and Secondary
Schools. New York, Longmans, Green & Co., 1907.
Bibliographical Note. " Material for Arithmetical Problems," pubhshed
by the Division of Reference and Research, Department of Education,
New York City, contains a wealth of problems related to business,
social, and civic life.
CHAPTER V
Office Practice and Routine
the pedagogic basis
Some practical teachers believe that office work can be
learned only by serving an apprenticeship in actual business.
But most educators agree that much of the preUminary train-
ing may be acquired in school. It is accordingly necessary to
devote some attention to the pedagogic basis underlying a
proper presentation of the subjects which constitute the main
divisions of this chapter. These topics are penmanship, busi-
ness forms, and office routine.
(a) Penmanship. — Upon first glance, it seems almost super-
fluous to include as a part of the present chapter anything
dealing with penmanship. It would seem as though the last
word has been spoken on the subject. But there are a number
of topics intimately connected with the matter under discus-
sion, which we deem it well to place before the reader. The
first deals with the importance of penmanship itself ; the
second with the way teachers of commercial branches, and
others who are not good penmen, may acquire an acceptable
business style of writing ; and, finally, the method of teaching
this subject to pupils of high school grade.
What are the earmarks of a good hand ? First, and prob-
ably of highest importance, is legibility. Writing is to be
read ; if it cannot be deciphered easily and without effort, it
lacks an essential quahty. Still, legibility is not the only
K 129
130 Principles and Methods in Commercial Education
norm. Were it such, we should argue in favor of a printed
form of penmanship. Speed, too, is an essential of a good
hand. Legible and quick, writing, then, is necessary for suc-
cessful business use. The question now becomes : What
writing combines these two important characteristics? For-
tunately, we are not compelled to do pioneer work in this
field ; others have performed the task thoroughly. The
cramped finger writing of the past decades no longer obtains.
Educators are now quite unanimously in favor of free-arm,
muscular-movement writing.
By free-arm-movement writing all do not mean the very
same thing. Upon one point, however, all are agreed. It
signifies a more general use of the arm muscles and a corre-
sponding decrease in the employment of the fingers. It makes
for the ability to continue writing over long periods of time,
with a uniform speed and a uniform degree of legibility, and
at the same time avoids the old penalty paid by scribes,
namely, " writer's cramp." Free-arm or muscular-move-
ment writing may be writing produced entirely by motion
residing within the forearm, or it may combine this type with
secondary finger movement. In either case, the pen is held
lightly ; some insist that the pen point over the right shoulder,
and that the first, or first and second fingers and the cushion
of the arm muscle alone rest upon the surface of the table.
Details regarding the relative merits of some of the rival
systems need not detain us in the present connection.
There are some who hold that a teacher can instruct in any
subject, provided he is a master of method and that there
exists a text-book on the topic. This is possibly true, but
surely an unethical stand to take by the teacher who essays to
handle a class in penmanship without being able himself to
do the work he wishes his pupils to accomplish. Moreover,
Office Practice and Routine 131
in manual work and in matters of the hand, just as much as
in matters of the mind, the teacher must be a leader. He
should teach by example. Unfortunately, many of us have
been brought up under a system which made for a cramped
and illegible hand, so that when called upon to give instruction
in penmanship, we must first put our own house in order.
But how may the busy teacher acquire the desired style of
writing amidst the many demands made upon his time and
energy? We do not now address those of our readers who
have both time and opportunity to attend business schools
which offer normal courses in the subject, but rather those
who must depend upon their own efforts, unaided by personal
advice and suggestion from expert penmen.
In the first place, it should be realized that success is open
to all who observe three necessary conditions : correct position,
proper models, and sufficient practice. By position is meant
the proper relation between the body and the writing surface,
the correct holding of the pen, the use of good materials, and
the existence of proper light. Models include copies to be
followed, together with intelligent practice and criticism.
Finally, it is not sufficient that one be able to reproduce the
copy; practice must be continued until the desired writing
becomes automatic. For the person who sincerely desires to
become qualified to teach this subject much has been done
by a few enthusiastic leaders. Books containing copies to be
followed, together with detailed instructions, are now avail-
able for self -instruction, while those who cannot come into
personal contact with the masters can substitute the benefit
of correspondence instruction. And by way of suggestion,
some communities, like New York City, for example, have
organized classes to instruct pubHc school teachers in the
subject.
132 Principles and Methods in Commercial Education
We may now devote our attention to methods of instruction
in penmanship in the commercial departments of our high
schools. Before we proceed any further, it would be well
to consider the pupils whom we are to meet. As graduates
of an eight-year elementary school course, the uninitiated
would be justified in assuming that no instruction in writing
would be necessary. Experience, however, shows that such
is not the case. As a matter of fact, the high school teacher
is frequently confronted by the double task of breaking up a
rigid finger movement and substituting therefor a free-arm
movement. In a number of cases, the task is almost a hope-
less one, but the success which has attended enthusiastic
workers in the high schools and in the grades should serve
to spur us on to renewed efTorts. In the schools of New
York City, for example, a campaign has been waged so that
elementary school teachers have become proficient writers.
As a result the graduates of the grades, in many districts,
no longer require instruction in penmanship when they enter
high schools. But this is not universally true, so that the
commercial teacher is not yet free to assume that his charges
require no attention in writing. Hence the need of consider-
ing methods of instruction.
As a general proposition, the dexterity required by manual
subjects is acquired as a result of repetition. A process is
gone over repeatedly and finally becomes automatic. From
this premise, some have concluded that the best way of teach-
ing penmanship is to concentrate upon it, say, five periods per
week for a term, and then to drop it. We know that this
method gives admirable exhibition results ; we know, too,
that just as soon as the subject is dropped, many pupils suffer
a relapse and begin their wonted scribbling again. The ad-
mirable course, though not practical in most institutions,
Office Practice and Routine 133
would be a five-period course for about half a term, then one
of five half-periods for the rest of the term, and a few minutes
per day throughout the entire four years. But though these
suggestions are not feasible, the general principle will serve
us still. Concentrated class work at the beginning, together
with home-work practice, and an insistence upon proper pen-
manship in all written work throughout the school years,
would give ideal results. And that this is not an impossible
ideal is clear from the parallel fact that many of our institu-
tions have succeeded in establishing good English, not only
in the language rooms, but as a necessity in all recitations.
It is still necessary to consider how to present the subject
of penmanship as a class topic. The first essential is to break
up the cramped style too frequently characteristic of the
grammar school boy and girl. For this purpose large ovals,
loops, and straight-Hne exercises have proved themselves
most serviceable. Exercises involving ovals and straight
Unes, gradually decreasing in size, give control. The simple
strokes and letters should precede the more complex. Such
stems should be employed which, in themselves or by a slight
modification, may be used for a number of letters. The
sequence of exercises in the copy books may be followed as
the principles just enunciated have been, in a measure,
observed, but the teacher should feel free to change the order
of presentation whenever, because of his own training or
through habit, he feels a later copy to be easier or simpler than
an earlier one.
Home work should be assigned, and both sides of a foolscap
sheet will be about sufi&cient in amount. For particularly
weak pupils, extra work may be necessary. The danger
should be avoided of shghting this subject. Impress upon the
pupils that most positions are secured through the medium of
134 Principles and Methods in Commercial Education
a written application, and that unless their writing is of a
grade sufficiently good to a rest attention, their letters may
not even be read. A marking scheme whereby each pupil is
given credit for each letter or figure as soon as acceptable, and
where extra drill is required upon work not satisfactory, has
often proved helpful. Original exercises involving ovals and
other simple strokes help to maintain interest in an otherwise
dry subject. Many beautiful ornamental pieces, flowers,
vases, and animals are thus produced.
Lawyers are famihar with the poor observation of the ordi-
nary witness and make the most of such deficiencies during
cross-examination. Research in psychological laboratories
has impressed upon the teacher the fact that it is not suffi-
cient to place before a pupil a model and expect perfect
reproduction. The teacher of penmanship employs his knowl-
edge of psychology to the end that the slight differences be-
tween good letters and poor ones be thoroughly appreciated
by his class. Thus, a certain letter is placed on the board and
members of the section are encouraged to criticise it. They
are then asked to offer suggestions toward improving it, and
also hints helpful in avoiding bad work. They then practice
on the exercise in question, and when stopped, are asked to
discover certain definite faults in their own work which they
may correct by going over the poor letters or words. Finally,
individual help should be extended by the teacher, who points
out faults and writes models for the pupils to follow.
In concluding these brief remarks, let us decide what is the
proper aim of this course. Engraving and diploma lettering
is not the ideal aimed at. A legible, neat hand, quickly and
easily executed, is all-sufficient. This is often accomplished
after a few months' conscientious work, but the complaint
still obtains that the upper-grade students and the grad-
Office Practice and Routine 135
uates produce miserable hieroglyphics. So why this relapse ?
Because our school work is not a unit. Our instructors are
specialists, each of whom is intent upon his own particular
subject. It ought to be possible to unify the entire work so
that each instructor would consciously direct his attention
against faults even when not directly concerned with his own
recitation. Just as we have succeeded in arousing a demand
for better English, so we may hope that the good penmanship
which has been acquired in the early part of the course shall
attain a true fruit-bearing stage and remain as a permanent
asset.
(b) Business Forms. — It is customary to teach the com-
moner business papers in connection with the course in
penmanship. The reasons for so including it are that the
forms make the penmanship more interesting and that they
are simple enough for treatment during the first year. More-
over, parents demand instruction in " practical subjects,"
like bookkeeping, at once, and it has been found that the
treatment of business forms is interpreted as instruction in
bookkeeping, as in a certain sense it is, so that the wishes of
the taxpayers are honored without forcing the youth too fast.
Bookkeeping is not appreciated by the immature, while many
of the commercial papers offer no difficulty. Furthermore,
even if the pupil leaves school during the first year, a knowl-
edge of forms will often prove beneficial, which is an added
reason for offering it during the freshman year.
What forms should be included is the first question that
confronts us. Obviously enough, some are too difficult,
others are quite useless except in connection with other sub-
jects such as bookkeeping or commercial law, while a number
are sufi&ciently easy and useful to make them suitable for the
purposes of the first year's course. Among the latter are
136 Principles and Methods in Commercial Education
checks, promissory notes, invoices, monthly statements, de-
posit sHps, orders, receipts, and the filling out of "a few blanks
demanded by the industry of the community. Though most
of the papers to be handled contain printed portions, it is
well for both pedagogic and economic reasons to have the
class write out the entire forms. It is also a good policy to
give the class practice in filling out forms, as this latter exer-
cise is what they will be called upon to do in actual Hfe.
Most of our boys and girls who leave during the first high
school year, unless they go to a private institute for instruc-
tion in commercial subjects, find their way into some office
or shop. It is safe to assume that one of the earhest tasks
assigned them is in connection with invoicing, so we shall
take for first treatment the teaching of the bill or invoice.
Prepare them for the form by getting them to see that their
parents do not ordinarily pay for purchases from the depart-
ment store until a " bill has been rendered." " Why is this
so? " will surely eUcit that it is desirable to know what the
bill is for and the price. Further questioning will bring out
the need of a date, name of buyer and seller, terms, and sys-
tematic arrangement of items. Continued practice will be
necessary in order to make their understanding at all satis-
factory, but one should not be surprised to find this so when it
is reaUzed that the form is quite complex, and that they have
had no real world experience. Drill upon a single form should
be continued, and variations should not be introduced, until
the type has been thoroughly mastered. It is almost needless
to suggest that every bill should be regarded as an exercise in
penmanship, but it is more helpful to point out that correla-
tion with the work in commercial arithmetic might be secured
by having the arithmetical operations performed during the
mathematics period. Some invoices are so complicated as
Ofice Practice and Routine 137
to make it advisable that they be relegated to a late part of
the course, and this apparent lack of continuity will be more
than compensated for by the fact that interest will be main-
tained by the introduction of different forms, which would
not be the case were all the invoices to be disposed of as a
connected series of lessons.
Monthly statements are quite as simple as invoices, but in
order to prepare them some knowledge of personal accounts
must be assumed. It is sufficient for the present purpose that
the student understand that the debit or left-hand side repre-
sents the sales, while the other side contains the payments and
returns. Exercises on these statements should include their
proper interpretation as well as their making, and also an
understanding of their purpose in business. Students should
bill goods to their classmates and later send monthly state-
ments. These statements should be " checked up," and in
the more advanced work, when creditors' accounts have been
presented, they should be compared with corresponding ledger
accounts.
The subject of checks, together with its full connotation,
forms one of the most interesting series of lessons in the
course. It involves the opening of a bank account, the keep-
ing of the check-book, the reconciliation of check-book bal-
ance with bank balance, and some elementary law connected
with checks. We consider it necessary that the student be
impressed with the need of fiUing out the stub first, so as to
avoid " overdrawing." The difference between bearer checks
and checks made to order of payee should be explained and
illustrated. The responsibihty of the bank for paying forged
checks and for paying " raised " checks ought not to be neg-
lected, but the necessity of so writing the amount of the check
as not to encourage alteration should also be discussed. The
138 Principles and Methods in Commercial Education
simpler indorsements, such as the blank, the full, and the one
for deposit only, form a natural part of the course. Besides
the law already involved, something might be said regarding
the need of depositing or presenting the check within a rea-
sonable period of time. And in conclusion, it would be well
briefly to treat of the matters connected with certified checks.
Certain researches of one of the authors ^ has revealed the
fact that the business community is not employing promis-
sory notes in settlement of account as a general practice. But
the time is not yet ripe to discard these papers from the course
under review. Just as in the case of checks, the filling out of
the form and the relation between the maker and payee will
have to be pointed out. The law regarding the date of pay-
ment, the certainty of amount, and the other requisites, after
discussion, might be committed to memory in the form given
in some of the text-books on commercial law. Single-name
paper, as employed for raising funds at one's own bank or from
note brokers, might be briefly discussed with profit.
What has just been said regarding the decreased use of prom-
issory notes is even more apphcable to the drafts of our com-
mercial arithmetics and of our bookkeeping texts. Though
three-party drafts are famihar instruments to continental
Europe, very few, comparatively speaking, have been em-
ployed in the domestic commerce of the United States since
the Civil War. A prominent bank president is authority for
the statement that the draft as illustrated in most of our cur-
rent commercial texts presupposes a set of business relations
between business men in separated sections of the country
hardly practicable. But though time drafts are no longer
familiar, sight drafts to the order of a bank are becoming more
1 The Development of Mercantile Instruments of Credit in the United States,
J. J. Klein.
Office Practice and Routine 139
and more common as an effective means of collecting due
accounts. Such papers should be freely discussed and set
for class exercise. For those who still insist upon presenting
the obsolete time draft, the economy effected by avoiding
transmission of funds, together with the relationship between
the parties before and after acceptance, and before and after
payment, should receive attention. And for both forms, be-
sides the corresponding matters which also affect notes and
checks, the subject of protest should be touched upon.
Every boy and every girl who reaches the high school might
be assumed to possess knowledge sufficient for the purpose of
making out an ordinary receipt. Our experience justifies
the statement that such is not the case, however. It is thus
necessary to set drills on receipts in general and when issued
for a specific purpose. Among the latter it would be well to
include those given for payment of rent, for deposit on a pur-
chase, and for part or in full payment of a particular invoice.
Somewhere in the course, also, though often taught as a part
of the so-called commercial English, room should be found
for orders, both by mail and when the goods called for are to
be delivered to bearer or to some other designated person.
We caimot leave this topic without some word regarding
the more complicated and though very important, still less
common, business forms. Among these might be mentioned
the papers employed in selling, leasing, or renting of real
property, in importing and exporting merchandise, in shipping
by land or by sea, and in the various special lines, most of
which are represented in our larger cities. It must be clear
that it would be impossible to teach all of these forms with
any reasonable degree of thoroughness within the period at
our command, that for some of them our first-year pupils are
too immature, and finally, that pupils who remain with us
I40 Principles and Methods in Commercial Education
for only a single term or two will hardly ever be called upon
to handle such papers. For all of these reasons, then, we
do not favor an attempt to cover all of them. Moreover,
some forms, such as those used in making postal, telegraph,
and express remittances and others, may be and are explained
during the course in commercial arithmetic, while most of
the others are more satisfactorily handled in the commercial
law course or in the technique of commerce.
Though our stand regarding these matters is definite, we
nevertheless recognize the contentions of those who argue in
favor of a wider and more general course rather than a narrower
one. But we answer that it appears much better to us that
a few items of prime importance be thoroughly mastered,
rather than that a great variety be presented but not actually
learned. Success in the working out of this policy requires
continuous drill and close application. Thoroughness is es-
sential, for a check unsigned or a note undated or a draft not
containing the name of the drawee may all lead to incon-
venience or even to trouble. And yet, though we do favor
this thoroughness, we nevertheless regard it as advisable
that somewhere during the course, especially on behalf of
those pupils who are not to remain with us long enough to
graduate, the students be made to reahze that other forms are
required in business, and if they should ever be called upon
to employ them, they can obtain the requisite knowledge by
going to certain sources. Indeed, this abihty to help one's self
is one of the richest heritages which education holds out to
the student.
In the chapter on bookkeeping, it was promised that the
business forms employed by the so-called business practice
or budget systems would be treated of in the present connec-
tion. We propose to redeem this promise by way of conclud-
Office Practice and Routine 141
ing this topic. An analysis of the problem discloses that we
are confronted with a simple problem of correlation — the
close connection between business papers and the transactions
they give birth to. A just criticism of many budget sets in
bookkeeping is that too much is attempted at once ; a compli-
cated business form and a new bookkeeping transaction are
introduced simultaneously. The teaching of the form, if
thoroughly done, takes up so much time and so beclouds the
bookkeeping issue, that often the accounting feature is almost
entirely lost sight of. Then, again, papers, such as invoices,
notes, and others, occur so frequently that they do not serve
any other purpose than unduly to lengthen the course. Our
criticism is thus divisible into two parts, — the first deals with
the introduction of complicated papers during a bookkeeping
exercise, the other with the padding process.
Constructively, we would advocate that budget sets be not
introduced until much later in the bookkeeping course than is
the present vogue. When they are introduced, they would
serve their proper ends if much curtailed both individually and
in volume ; that is, if single papers were less lengthy, and if
there were fewer repetitions of similar forms. In other words,
we favor really shorter sets. And along these same lines,
we should very much like to see fewer sets involving the actual
handling of business forms, thus leaving more time for book-
keeping and accounting per se. Finally, just one other sug-
gestion, which we regret cannot be carried oat in many of our
institutions. Inasmuch as it is well to treat business forms
as distinct from bookkeeping, the best sort of correlation and
efficiency would be consummated were it possible to employ
the papers executed during the first year's work in the book-
keepmg of the second year. But though this is an ideal to be
striven for, at least a part of it might be realized were the
142 Principles and Methods in Commercial Education
knowledge gained to be so employed as to save some time in
bookkeeping by decreasing the proportion now usually allotted
to the making out of forms and papers supposedly already
mastered.
(c) Office Routine. — Educators are" coming more and more
to recognize that our schools and institutions are not alone
for those who are fortunate enough to be able to complete the
full course as planned, but also for those who drop out by the
wayside. The recognition of this fact, together with the
influence of the German system of education which aims to
train for life work, has led some educational leaders to strive
after a curriculum such that while each term's work is in a way
a preparation for the next, yet each is a unit in itself and
useful even without the supplemental work of the higher
grades. The practical application of this ideal is yet to be
attained, but the mere fact that it is regarded as a desirable
end must hclj) the programme maker. A corollary of the main
thesis as applied to commercial high schools would be that the
first year should be a foundation for the second, and at the
same time be fruit-bearing itself. But the boy or girl who must
leave us after a single year cannot hope to be prepared for the
duties of the bookkeeper or the stenographer. He or she
should, however, be able better to earn a livelihood because
of this year's study. A definite training in the duties of the
office boy or girl would meet the twofold requirements of
modern education that each unit of work be both complete
and preparatory.
The course of study for the first year is so heavy as not
to permit the inclusion of a special course in training for office
duties. But somewhere, in connection with penmanship and
business forms, or with commercial arithmetic or with English,
or combined with two or more of these subjects, a place for
Office Practice and Routine 143
the work could be found. Here the filing of letters and other
papers, the caring for incoming and outgoing mail, the receiv-
ing of callers, the answering of telephone calls, and the miscel-
laneous assistance one may be called upon to render to superiors,
should receive attention. It is obvious that, except in com-
munities where there is a single industry, no attempt can be
made to train for the work in a particular oflSce. In the larger
centres the duties of the office boy in a stock broker's office
differ considerably in detail from those in a manufacturing
office, say, as indeed they differ somewhat between two
offices of concerns in similar lines, so that our pubhc schools
must content themselves with offering instructions of a general
nature. Still, as pointed out in the final chapter, a real
bridging of the gap between school and office is possible and
feasible.
Many people call at an office during the course of the day.
The office boy very often is the first one to greet the caller.
The reader must be familiar with some of the many stories
told of the brazenness, stupidity, and lack of manners of
some boys in receiving certain important visitors. A few such
tales serve as an admirable introduction to the need of cour-
tesy and politeness. The impUcit and explicit obedience of
orders regarding the wishes of superiors to receive certain
people, without violating confidence reposed, needs emphasis.
The keeping of the waiting-room neat often rests upon the
beginner, so that it is quite apropos to touch upon this sub-
ject in the present connection.
There are many kinds of filing systems, but the principles
embodied in the old alphabetical letter file persist. It is
sufficient for the purposes of the beginners' class that they
understand alphabetical and numerical fifing in its simpler
forms, while the more complicated kinds should be reserved
144 Principles and Methods in Commercial Education
for treatment in connection with the more advanced work of
the course. The students should be shown how to arrange
the filing matter so as to avoid the necessity of turning sections
back and forth. Here, too, the indicating on the outside
of the folded matter of the nature of the contents might be
alluded to. Precis writing, as practised in the English room,
would serve in good stead here. In many cases, the name
of the parties concerned, together with the date, is sufficient,
so that the important item consists in the proper placing of
such information, and the students will in many instances be
able to suggest the best arrangement. In other cases, folding
of the paper in such a way as clearly to indicate the desired
information may be both desirable and feasible.
Inasmuch as the mail is often assorted previous to distribu-
tion among departments, it is well that our students devote
some attention to this matter. The most elementary kind of
separation consists of a division based upon the information
contained on the envelope. This is often supplemented by
having the mail matter opened, so that it becomes necessary
to discuss the use of a paper cutter without injuring the con-
tents of the envelope. In more advanced classes, it may be
desirable to open the envelopes and distribute the mail after
reading it. At first each letter should deal with a single
department, but later compHcations might be introduced by
having the communications refer to two or more departments.
In this latter connection the use of marginal notations or
stamped instructions to pass the matter along could be
introduced.
But while the matter of receiving the mail is as often as not
cared for by a superior employee, the beginner is almost
invariably called upon to dispose of the outgoing cor-
respondence. Among the items to be considered in this
Office Practice and Routine i45
connection are the stamping and sealing of envelopes, the
making sure that the letters have been properly signed,
and that where enclosures are called for they have not been
omitted, the folding of the letter heads, and, sometimes, the
addressing of envelopes to correspond with the salutation on
the communication. Here the need of care to avoid con-
fusing mail had better be emphasized. The use of sealing
and stamping devices might be illustrated if the opportunity
is afforded.
At this point the use of office furnishings for the purpose
of giving the pupils practice might be profitably discussed.
If funds are available, it is undoubtedly good poUcy to acquire
as complete a set of modern appliances as possible. For those
institutions that cannot aim at completeness in this matter,
the following, in the order given, is suggested : a fifing cabinet,
a letter copying press or a rotary copying press, an envelope
sealer, and an automatic addresser. Minor furnishings and
variations need not be specifically indicated. In the absence
of certain items, graphic illustrations with clear explanations,
especially if in connection with an opportunity to inspect the
object under discussion in actual use in some office, are admi-
rable substitutes for personal experience.
The beginner must be impressed with the fact that any posi-
tion he secures is a stepping stone to higher ones. In order
to prepare himself for greater service, and to merit the reward
of promotion, it is essential that he give the best that there
is in him. He should be willing and anxious to assist others,
for only by so doing wifi he be able to fill higher places when
called upon. He must be punctual, industrious, obedient, and
courteous, so as to attract attention to his virtues. He must
also be ambitious, and if he has had to leave his school educa-
tion prematurely, he should strive unceasingly to improve
146 Principles and Methods in Commercial Education
himself by reading books dealing with his work, by attending
evening classes or enrolling in correspondence schools.
Other items connected with the conduct of an ofhce can best
be treated in the bookkeeping, stenography, and typewriting
classes. Much good mental discipline is afforded by various
problems which arise in connection with the managing of an
ofl&ce. Here all the subjects of the commercial course are
called into play, so that office routine involves in a large
measure the science of business. As a simple example,
what should you do if you learned that a certain party to whom
you had just shipped goods was a probable bankrupt? Or
suppose a stranger wished to open an account with you, what
action should be taken? Or, as a final example, how would
you decide whether or not to accept an order for the first time
from a foreign country, and if you did accept, when and how
would you secure shipping instructions? Questions such as
these offer great opportunity for the development of initia-
tive on the part of our pupils, and at the same time supply
them with what is much more useful than information and
facts, namely, the abihty to acquire fight for themselves.
SUMMARY
This chapter concerns itself with the subjects of penman-
ship, business forms, and office routine. It was pointed out
that despite the fact that educators have come to reafize the
necessity for instruction in free-arm, muscular-movement
writing during the eight years of the elementary school course,
sufl&cient progress has not been made to obviate the necessity
of further attention during the high school course. As the
tests of good penmanship are legibiHty, speed, and ease of exe-
cution, these characteristics determine the methods to be
employed by the teacher of penmanship. One basic factor
Office Practice and Routine 147
in all habit-forming subjects, i.e., initial impulse, cannot be
employed, because the task is rather one of unlearning than
of acquiring new knowledge or new power. Constant prac-
tice, based upon correct models, and subject to careful and
intelligent supervision, is essential to success. It is not suffi-
cient that the penmanship teacher alone insist upon correct
posture, etc., but the teachers of all the other subjects in the
high school course should be encouraged to exact high-grade
written work, so that good penmanship shall become general.
One difficulty that confronts the administrator who is de-
sirous to teach good penmanship is that many teachers are
themselves poor penmen. But this fact need not handicap
the teaching corps indejQjiitely, because every teacher may
become proficient in muscular-movement writing by conscien-
tious and persistent effort.
The commoner business forms should be presented during
the first year of the high school course. The reason for this
statement is found not alone in the fact that the subject is
sufficiently easy and certainly worth while, but also because the
taxpayers demand early instruction in practical subjects such
as bookkeeping ; and business forms, when properly taught,
" appears " to be bookkeeping. Though it is true that this
step is somewhat of a compromise, this is only apparently so,
as no harm has been done, and the students feel that they
are receiving instruction in the subjects which they beHeve
are most useful.
The more difficult business forms should not be presented
until much later in the course, and then in connection with
bookkeeping and business law. It is a mistake to attempt
to teach all business forms at once, as many of them cannot
be comprehended by the students with their apperceptive
basis at the time when they enter high school. Later on, as
148 Principles and Methods in Commercial Education
their experience broadens, they are in a position to benefit
by the advanced work.
Another benefit which accrues as a result of presenting
business forms during the early part of the course is that much
detail work in connection with the so-called budget system of
bookkeeping may profitably be curtailed. As a matter of
fact, one of the main objections to the budget system is that
the volume of prehminary work required, in the preparing of
forms and handling of papers, is so great as to minimize the
real instruction in bookkeeping. Moreover, the handling of
these papers, in connection with bookkeeping, tends to distract
the attention from bookkeeping to the business forms, and
frequently leads to the making of entries not fully understood.
As educators have come to realize that the high schools
should be thoroughly democratic, they have come to demand
that every term of the course shall be complete and fruit-
bearing, so that the boy or girl who cannot afford to graduate
shall nevertheless be benefited by studying for a short while.
This does not mean that the entire course is not a natural
progression, so that each year's work is a preparation for the
next, but rather that while each term shall lead to the succeed-
ing term, nevertheless each year shall be self-sufficient and
worth while. As a corollary, it is advocated that office
duties shall be a subject of instruction during the first year,
not as a special course, but correlated with some other subject.
In this connection it is necessary to point out that certain
office appliances must be secured. Finally, much of the work
in connection with office routine and practice belongs to the
course in stenography and typewriting, and should there
receive proper attention.
Office Practice and Routine 149
EXERCISES
GROUP ONE
1. Why should penmanship be taught in the high school ?
2. Explain your method of securing good results in penmanship.
3. What steps would you take to improve the penmanship of the
teachers of your school ?
4. Explain fully the value of penmanship aside from its practical
aspect.
5. Should business forms be taught as a separate subject or in relation
to other subjects ? Discuss fully.
6. Name three common forms suitable for first year's work, and three
common forms too difficult for the work of beginners.
7. How may instruction in business forms be interpreted as element-
ary bookkeeping ?
8. Describe the budget system of bookkeeping, and discuss its place
and value in the modern commercial school.
9. Explain the method of teaching filing in a high school.
10. Of what value is the subject of ofiice routine to students who
remain in high school only six months ?
GROUP TWO
1. What per cent of pupils who enter high school in your city require
specific instruction in penmanship ? Analyze the situation and develop
a plan whereby the various groups are offered such work in this subject
during the first year as will benefit them most.
2. Prepare a course in filing for a high school consisting of three
hundred commercial pupils. Assume that $200 has been placed at your
disposal, and that you will have the services of one teacher for six hours
per week.
3. Develop a system of correlation between the various subjects
in the curriculum of your school, so that there will be no need of offering
business practice as a separate course.
4. Criticise the course of study of your high school, in its relation to
the subject-matter of this chapter, and offer specific constructive sug-
gestions.
5. What provision would you make to keep the instruction of the
subjects discussed in this chapter up to date ?
150 Principles and Methods in Commercial Education
BIBLIOGRAPHY
DiCKSEE AND Blain, Office Organization and Management. London,
Pitman & Sons, 1906.
Healy, Horace G., System of Free-arm Movement Writing. New York,
American Book Co., 191 2.
Miner, G. W., Bookkeeping. New York, Ginn & Co., 191 2.
Montgomery, J. L., Modern Bookkeeping and Business Practice. New
York, C. E. Merrill Co., 1906.
Neal and Cragin, Modern Illustrative Bookkeeping. New York, Amer.
Book Co., 1911.
Palmer, A. N., Method of Business Wriling. New York, Rode & Brand,
1913-
Schulze, J. W., The American Office. New York, Key Pub. Co., 1913.
Teller and Brown, Modern Business Methods. Chicago, Rand,
McNally & Co, 191 2.
Thompson, M. E., Psychology and Pedagogy of Writing. Baltimore,
Warwick, 191 1.
CHAPTER VI
Bookkeeping
pedagogic principles
It has become quite the fashion for writers of bookkeeping
texts to refer to the fact that though four hundred years and
more have passed since Fra Paciolo's work, the basic principles
of the subject have undergone no change. Similar statements
might be made of mathematics, languages, and other branches
of knowledge. It is simply another version of the time-
honored truth that though principles are permanent, appU-
cations are transient. So it is that just as in the case of those
sciences and arts which constitute the subject-matter of our
school and college curricula, experience has furnished in at
least a few of the topics grouped under the title Commercial
Branches a coordinated mass of knowledge to which peda-
gogic devices have been applied. This chapter deals with
the appHcation of such doctrines to bookkeeping alone.
Many of our institutions, responding to the ever increasing
demand for business education, are now offering courses in
bookkeeping. Here, as also in schools where complete com-
mercial instruction and training is offered, this topic is regarded
as a major subject in the course. Sound judgment underlies
this view, though it is often observed that such selection has
been frequently the result of bHnd imitation of work given
elsewhere. Two other reasons have also contributed to the
position occupied by bookkeeping : the fact that knowledge
152 Principles and Methods in Commercial Education
of this topic is readily translated into terms of dollars and
cents, and secondly, that greater apparent progress has been
made in the direction of " teachableness " of this subject
because of the number of texts and available material on the
market.
But even a cursory examination of the technical literature
on this subject will surprise the investigator with the sameness
of the many texts offered for sale. All of these books are
roughly divisible into two groups, — the theoretical and the
practical, the latter being in reaHty a combination of the two.
Most of the books dealing with the theoretical presentation
follow what is known as the journal-ledger method, i.e., the
journal is taught first and postings to the ledger subsequently.
From time to time, different authors have attempted a more
scientific as well as a more pedagogic method by teaching the
account first ; practically all, however, have missed the essen-
tial relationship of account to account, which obtains in the
double entry system. It is also to be noted that, with a very
few exceptions, all are agreed that double entry bookkeeping
is to be presented at the start and as the essential method of
the course, while single entry is relegated to a subordinate
part. Regarding the texts which deal with practical book-
keeping, and the greater number nowadays are these, the so-
called budget or business practice system appears to predomi-
nate. Detailed criticism and further comment on this topic
are reserved for later treatment.
Does bookkeeping deserve the high position which it
occupies in commercial education? It surely does in view
of its recognized importance in the business community.
But it must be admitted that it holds the position it does
despite, rather than because of, what teachers have done for
it. This statement is made advisedly in view of the fact that
Bookkeeping 153
many successful pedagogues, even after fifteen and twenty-
years' experience, have either a warped or an inadequate idea
of just why the subject is taught. Many of them will say
when asked for the first time that the sole excuse for teaching
the subject is because of its utilitarian value, i.e., because of
its usefulness as a trade or calling. While fully in accord
with the doctrine that bookkeeping is distinctly a practical
subject, it must be evident that to one whose only aim in
teaching a subject is an attempt to impart a knowledge of
" how to do it," the method whereby this object may be at-
tained is of small consequence. In other words, it sums up
the fault of teaching a trade now counteracted by the manual
training movement, which is a wise and serious endeavor to
substitute adaptability for adaptation.
It is premised of bookkeeping, as of any other subject,
that the very best index to the methodology to be employed in
presentation is a clearly defijied motive. We must first
decide why we teach it. The how and the when are after con-
siderations. Why, then, should the keeping of books be taught
in our schools? It is necessary that we regard this question
from a twofold aspect of pupil and subject-matter. To under-
stand the former a knowledge of psychology is requisite;
a thorough understanding of bookkeeping and accounting
is essential for the latter. The first chapter of this volume
summarized the psychologic foundation underlying teaching
success. It is assumed that the reader is sufficiently familiar
with his subject to make specific reference to texts on book-
keeping and accounting unnecessary.
What may the pupil reasonably expect as a result of his
course in bookkeeping? Elsewhere is discussed the purpose
and aim of the commercial course. Here we concern ourselves
with the result of the work in bookkeeping alone. Obviously,
154 Principles and Methods in Commercial Education
the student should be prepared to start, or to continue, a set
of books previously begun, in an ordinary trading, commission,
or manufacturing concern. He should be able to conduct the
books of such an enterprise, whether organized as an indi-
vidual, a partnership, or a corporation. He should be able
to devise the books incident to simple partnerships as well as
to corporations, and be famihar with the ordinary adjustments
occasioned by the results shown at the end of fiscal periods
or due to dissolutions. The additional ability afforded by
training in accounting is reserved for a separate chapter, and
the incidental knowledge of business forms and usages inherent
to a practical knowledge of the subject is also treated of in
another connection.
The aim of a course in bookkeeping is thus easily outlined.
Nothing less than what has just been sketched is deemed
requisite by most modern educators. The fault lies in the
beUef that the imparting of the knowledge here outlined so
briefly sums up the end and aim of the course. It is just
here that we take issue with the old-school commercial teacher.
It is not enough that our pupils know how to journalize, post,
prepare statements, etc. Too long, indeed, have we been
content with teaching which would result in just this knowl-
edge, and nothing else. Yes, it was knowledge, and not
ability, that was given. We argue for knowledge plus that
power which enables one to cope with the hitherto unknown.
Consider this illustration. The advent of the modern corpo-
ration necessitated entries previously not experienced by the
bookkeeper. The Uterature of our subject abounds in examples
of how the kind of training we deplore limited the understand-
ing of those called upon to solve the new problems. We are
just beginning to emerge from the fooUsh errors which their
solutions led us into. None of us can tell the changes which
Bookkeeping 155
the near future has in store for us. It is our duty, now that
we are awake to our true position, so to train, not merely
impart information, as to give this power of initiative, of
reacting to new and strange conditions. This can never be
accomplished by the rote-method which once prevailed.
What then, is the question, should be given besides the drill
and imitation, which will make possible the keeping of a set
of books? The reasoning power should be, and can be, devel-
oped, as will be shown in the model lessons which follow.
The constructive imagination, that power which next to rea-
son makes life worth while, is developed by bookkeeping,
perhaps better than by most subjects ; and this, too, will be
illustrated in models to be presented subsequently.
Thus, to sum up, we want the course in bookkeeping (which
is often the only commercial subject offered, or in many places,
as for instance in so many private business schools, the only
subject which affords the higher mental discipHne) to be treated
in such a manner as to realize in full measure all its pedagogic
possibilities for the student. To this end, the barren imita-
tion of types and models, which for so long has been the chief
means of imparting famiharity with the subject, must be
superseded by the modern treatment already suggested.
When the conscientious teacher of the newer bookkeeping
grasps this idea, the problem of the methodology will evolve
slowly, perhaps, but surely ; for just as the boy is father to the
man, the thought is sponsor to the fruit-producing effort.
But before we consider the subject of method, we must return
to the other phase of the problem we have been discussing —
the teacher.
What is expected of the ideal teacher of bookkeeping?
It would be a needless task to enter into a discussion of those
elements without which successful • teaching is impossible.
156 Principles and Methods in Com?nercial Education
Many books have been written on this matter, so that it may
almost be assumed that the last word has been spoken. Be-
sides those qualifications inherent in the make-up of the ideal
pedagogue, certain other factors are almost essential for the
best results in the teaching of bookkeeping. No such teacher
can be a bookworm. He must have first-hand knowledge of
the world outside the schoolroom. For this reason it is best
that he should acquire some actual office experience, if neces-
sary, during the summer vacation. The corollary often de-
duced from this proposition is as actually, as it is logically,
false. The man who has nothing else to offer except his
practical experience cannot teach the subject ; the bookkeeper
or accountant per se is not the person for the class room.
Though the stand we take is quite heterodox, and will not be
applicable for some years to come, we believe that the ideal
instructor is he who, in addition to the culture and training
of the college and university, has had the benefits of practical
experience in the world of business. But this discussion need
not detain us longer, for the problem has been treated of in
Chapter III, and will be further considered in Chapter XV.
We return to the question — Why should bookkeeping be
taught in our schools? As has already been intimated, its
practical utility is the prime, but by no means the only, reason.
The present teaching of accounts consists, in general, of a
scheme whereby rules are arbitrarily assigned, often disguised
as reasons by the use of the logical conjunctive because, and
an attempt to impart familiarity by long-continued repeti-
tion of assigned model forms. Consider these illustrations
taken from a number of widely used texts :
(a) Debit what the business receives, or what costs value.
(b) Whenever you pay a person on account, debit the person.
(c) When you owe a person, credit that person.
Bookkeeping 157
{d) Debit cash account because the business has received
value.
{e) Credit the person's account because he has gotten out
of our debt.
In each of these cases it is readily seen that the work is
absolutely deductive, and this at a stage when it ought to be
entirely inductive. The student is required to take every-
thing on faith ; if he errs in journaHzing, he is told, " You are
wrong because Cash must be debited when received," etc.
As will be shown later in this chapter, the stultifying influence
of such procedure may be entirely removed, and that without
lengthening the time devoted to presentation.
As a corollary to the assumption that bookkeeping is taught
solely for its utility, another evil has arisen. In the method
we have just criticised, the faculty of imitation is appealed
to almost exclusively. The appeal to the reason, the arousing
of the apperceptive basis, the stimulation of the imagination,
— for all of which the subject offers a great opportunity,
are almost entirely neglected. Consequently, we find that
teachers of bookkeeping deem it necessary to repeat element-
ary work in advanced classes. Thus, in ever so many texts,
and therefore in many, many class rooms, as new matter is
introduced, the sets become longer and longer, because, besides
the drill on the new material introduced, it is deemed neces-
sary to repeat previous work. The reason for this repetition
is often stated as being due to the fact that the work of the
school should approximate as closely as is possible to actual
business, where easy or elementary work and more difficult or
advanced operations arise almost simultaneously. Our ob-
jections to a continuance of such procedure are, first an undue
mass of materials ; second, the dispersion of effort by requir-
ing as much attention to what is already known as to new
158 Principles and Methods in Commercial Education
matter ; third, the practical impossibility of devoting more
time to work of greater value to the pupil, such as the making
of statements and the drawing of inferences from the books.
It seems to us that the solution is suggested in the neglect of
commercial teachers to heed that sound pedagogic doctrine
which enunciates that the best method of learning a topic is
to understand it. " That which one understands, one need
not memorize." In fact, the weak mentaUty of so-called com-
mercial students, observed by their teachers and their sub-
sequent employers, is probably directly traceable to their
training (or lack of it) in school, where, instead of developing
the reasoning faculty, all effort was concentrated upon the
almost inhuman — surely inhumane — task of forcing dis-
agreeable and superfluous material upon the youth. The
authors have demonstrated, time and time again, that a better
understanding of bookkeeping can be imparted by proper
methods with the use of from one-quarter to one-third of the
usual mass of material than is at present ordinarily attempted
with the well-padded text and modern budget. Hence, to
put the objections affirmatively, we favor shorter sets, less
arithmetical work in accounts proper, and much less, though
not entire neglect of, repetition of old matter.
If, then, utility is not the all-sufficient motive for the teach-
ing of bookkeeping, what is ? Before we can answer this ques-
tion, it is well to recall that modern conditions have so changed
the complexion of the industrial and economic life that much
of the discipHnary and cultural training afforded by the clas-
sical high or secondary schools must either be denied the com-
mercial student or else given him in conjunction with his
practical education. Elsewhere in this volume the cultural
side of business education is discussed. Bookkeeping is often
the medium whereby mental discipline must be furnished, if
Bookkeeping 159
at all. As will be shown in the model lessons below, the
inductive processes will be employed in the estabhshment of
rules and forms, while deduction will be the operation in their
subsequent employment. Proposed solutions should be tested
at all steps, by questions which should tend to confirm the
correctness of entries or else expose their faults. This, also,
will be illustrated later. Thus, it is seen, bookkeeping can be
so taught as to appeal not only to the parent of the boy or girl
who wishes his child to acquire a knowledge of the subject
because of its practical aspect, but also to the parent who,
entirely aside from the utility a subject may possess, desires
the mental power which comes from proper mind exercise.
If this latter phase of the subject can be presented to the
teachers of the land with nearly the strength and force with
which it appeals to the authors, and if, besides, a text can be
produced embodying the principles here enunciated and later
illustrated, then it is confidently beUeved bookkeeping will
come into its own rich heritage.
A few additional general remarks are in order before we pro-
ceed to a consideration of special lessons and topics. Inas-
much as the subject of bookkeeping is receiving serious atten-
tion on the part of educators who are probably competent
to produce texts of more permanent merit than those now in
use, and notwithstanding the fact that a good beginning has
already been made, we refrain from recommending any books.
There can be no doubt, however, that a text embodying the
pedagogic doctrines enunciated in this chapter, would fill
a real want. If, then, no ideal work is available, shall all
text-books be abandoned? Most emphatically no. Every
practical teacher knows that for purposes of efficient review,
texts are necessary. They are also valuable time-savers in
that a student may employ them for general reference in the
i6o Principles and Methods in Commercial Education
matter of forms, commercial paper, definitions, etc. ; and they
give abundant drill material.
As some sort of a text is essential not only for the reasons
outlined in the previous paragraphs, but also as furnishing
the overworked teacher with the Ust of transactions, one other
general question remains. This query deals with the char-
acteristics of a good practice set. We are in entire accord
with those who favor the use of the budget or business practice
set, though in passing, we wish to state that we do not favor
the use of correlated business papers until the theory has been
well presented. For a fuller discussion of this topic, the
reader is referred to the chapter on Business Practice. From
the point of view of bookkeeping alone, a number of simple
tests suggest themselves with reference to the requirements
of the practice set. These are :
1. They should emphasize the new points illustrated by
the introductory exercises which should always precede a
formal set.
2. Each set should be a review of previous work, but the
amount of such review work should be at a minimum. The
authors have in mind a set of corporation transactions con-
sisting of over one hundred and fifty entries, of which less than
one- tenth were directly concerned with corporation accounting.
3. The arithmetical work involved should be simple.
Involved commercial arithmetic should be left for the mathe-
matics room. Teachers are too prone to excuse lengthy prob-
lems on the ground that they are " practical" ; true, but they
distract from the subject taught in the bookkeeping room.
If possible, a correlation between the work of the bookkeep-
ing and mathematics room, to the end that most of the arith-
metic should be performed in the latter recitation, would be
an ideal plan.
Bookkeeping i6i
Before asking the reader's consideration of the illustrative
material about to be presented, it is well to caution him against
a blind acceptance of what is offered. The authors realize
the futihty of attempting to impress upon the teacher their
methods and devices ; all that is attempted is a suggestive
portrayal of what may be done to the end that Hfe interest
and pedagogic utiUty shall be imparted to the teaching of
bookkeeping. Hence, these model lessons are to be used
only as an index to a personal treatment of the subject by each
teacher for himself. As a matter of fact, the authors them-
selves do not adhere to a single mode of presentation ; they
have the aim of the given lesson before them ; they are then
in a position to avail themselves of the opportunities of the
moment in the matter of individuality of pupil and class, and
changes in time and place, to adapt the work to the exigencies
of the occasion.
The experienced instructor, and to a greater degree the
conscientious beginner, finds the first lesson in bookkeeping
as difficult a task as any single step. Here, as in the real
world without, the first impression counts for much. Of
course not much need be said of teachers who are known to
commence work by instructions such as these : ** Open your
books and study the first two pages ; " or, " Memorize all the
rules and definitions on pages 4 to 8 inclusive."
Here no difficulties arise because none are felt. But is not
the subject entitled to as favorable an introduction as it is
possible to give ? We think yes, even though it is the experi-
ence of many of us that the average pupil approaches the sub-
ject so eager for it that he needs no artificial stimulus to
awaken his interest. It has usually been our custom to dis-
cuss with the class, before beginning the formal study, the im-
portance of bookkeeping to the business community, the
1 62 Principles and Methods in Commercial Education
openings in business for bookkeepers, their chances of promo-
tion, etc., etc. It has always been found that many students
take pleasure in contributing to such a recital from the experi-
ences of their friends and relatives.
As will be seen, double entry bookkeeping is taught first,
and this for a number of reasons. Practically all concerns
requiring the services of a bookkeeper demand one familiar
with this system. The student who is forced to drop his
studies prematurely thus acquires the more useful of two
methods, and, finally, the transition from the former to single
entry is easier and more logical than in the reverse order.
Let it be remembered that single entry, from the standpoint
of the student mind, is not synonymous with simple book-
keeping.
We have had occasion to object to the exclusive appeal to
memory in the teaching of accounts. This objection will
be found reiterated subsequently. But let us not be misunder-
stood, for we stand second to none in our appreciation of the
automatic processes of habit which conserves the energy of
the human machine, so that more time and more effort be avail-
able for new situations. Nevertheless, we are compelled to
take issue with the narrow-minded poHcy which claims that
because an operation, or a set of operations, is eventually
to become automatic, bHnd, unthinking, and unreasoning drill
is the method indicated. It is true, of course, that after a
number of similar transactions have been handled, they will
come to be correctly recorded without a conscious hesitation
over the solution ; this result is natural, but it does not follow
that because the mental process is as is here indicated, that
memoriter work should predominate in the bookkeeping room.
In fact, the admission that the rules for debiting and crediting,
for example, are unconsciously mastered in time, is one of
Bookkeeping 163
the strongest arguments against the spending of time in mem-
orizing such rules.
MODEL LESSONS
Introduction — First Step
In order to save the reader's time, comment and length
of questions and answers will be curtailed as far as possible.
The answer, unless otherwise stated, is the one finally accepted
by the teacher, and then restated for the sake of finality.
These outhnes are all based on lesson notes taken from the
author's plan books.
Why does a business man " keep books " ?
Many answers will be given, but they can readily be tabu-
lated by their intent so as to show this answer :
In order that the proprietor may know the progress and the
condition of his business.
What kind of business does a person do ? (Take only a few.)
He trades, he buys and sells, etc.
When a business man buys a case of shoes, or sells a pair,
what is this buying or selling called ?
A transaction. (It is often well to make this statement,
though in general very little should be told which the student
can get for himself without too much sacrifice of time.)
Mention some transactions which occur in business.
Besides those given, paying wages, rent, telephone bills, etc.
In each case elucidate that every transaction involves an
exchange (transfer) of equal values. (Would you pay $4.00
for a $3.00 hat? Would an employer pay $12.00 for work if
he could get similar service for $10.00?)
Bookkeeping teaches us how to write or record such trans-
actions. We now proceed to record a few of them.
164 Principles and Methods in Commercial Education
Write on the board, or dictate to class, the following trans-
actions :
April 3, Sold 2 bbls. Flour at $8.00 = $i6.co
April 4, Sold i bbl. Flour at $8.50 = 8.50
April 4, Bought postage stamps = .50
April 5, Sold 5 bbls. Flour at $8.00 = 40.00
April 6, Paid wages to boy = 4.50
How much is left, or what is the balance ?
Offer this as a simple problem in arithmetic. Some boy
will volunteer a solution set down in this form :
What was received : What was spent :
April 3 $16.00 April 4 .... $ .50
April 4 8.50 April 6 .... 4.50
April 5 40.00
Total amount received $64.50 Total amount spent $5.00
.50 minus $5.00 = $59.50, balance.
Elicit from class that you had, first, a kind of diary record,
i.e., the list of transactions. Then you arranged the individual
entries, items, in the form shown. Then ask why you did so.
This arrangement is known as a " cash account," because
it is an account, or record, of money or cash. Set another
similar exercise, and then show them a formal cash account
(in their text-books, on the blackboard, or on a chart).
This account is not the cash book, but the ledger form.
Get them to point out the " cash received " column, the
"cash paid out" column. Why are dates desirable? Are
they really essential ? Could you determine the cash balance
if the dates were omitted? How about the explanation
spaces? We satisfy their natural desire to know by telling
them that we could insert opposite April 3 — "2 bbls. Flour,"
but for the present we need not do so. The account is taught
Bookkeeping 165
first because it is the fundamental notion in bookkeeping.
The first book taught is the ledger because it is the book of
accounts.
The chief argument in favor of the procedure of those who
teach the daybook, or journal-daybook first, is that it is the
chronological and hence the logical order, and that it is in
fine with the historical development of the subject. This
stand has no logical, philosophic, historical, or pedagogic leg
to rest upon. The first bookkeeping was of the ledger solely.
And it has lately been called to our attention that as a sort
of curious commentary on the law of evolution which states
that the Hfe history of the race is epitomized in the develop-
ment of the child to man's estate, the child-mind of an un-
tutored man who attempts bookkeeping without instruction
naturally hits upon the use of ledger-Uke accounts.
DEBIT AND CREDIT
No mystery attaches to these terms. They may be treated
as follows :
What is the name of the first column ? (No concert answers.)
The receiving column.
Can you think of any other name for it ?
The first column ; the left-hand column ; etc.
Now tell them that bookkeepers call it the debit column,
for a reason they will understand better as they study more
of bookkeeping.
Similarly, the other column is referred to as the credit
column. Follow this up with a few short exercises in cash
accounts, in which the arithmetic is simple.
It is preferable, often, to use a sheet of paper divided by
a perpendicular line through the centre rather than conven-
1 66 Principles and Methods in Commercial Education
tional ledger sheets, for reasons of economy and speed. These
are often called " T " (tea) accounts, because of the form :
Rules for Debiting and Crediting the Cash Account
The reader will observe that thus far the work was cor-
rectly performed without the conscious use of any rule.
Now take the debit side of a Cash account. Point out the
various items and ask, in turn, what each item denotes.
They will see the point of similarity, viz., each represents
money received by the business. Similarly, the items in the
opposite column represent money paid out by the business.
They will see that if the columns were transposed consistently,
the balance could be as readily determined. But as the
first order is the one employed in business, we shall adhere to
it. Ask for a formulation of rules or agreements, and accept :
Debit Cash account for all money received by the business.
Credit Cash account for all money paid out by the busi-
ness.
Ask them to write from dictation : Debit Cash account
$15.00; debit Cash account $25.00; credit Cash account
$12.00 ; etc.
DOUBLE ENTRY BOOKKEEPING
Just as in the first lesson, no technical terms are to be
employed until the way has been paved for them.
Recall that bookkeeping is a record of business trans-
actions. As no one would desire it to be a record of one-
• Bookkeeping 167
quarter, one-third, or one-half of the transactions, but of all
of them, it is a complete record.
Consider the Cash account employed in the last lesson.
It is a record of all the cash received and paid out by the
business.
If you ask whether the business consisted of anything be-
sides the giving and receiving of cash, the class will see that
goods were bought and sold, wages and rent paid, etc.
If bookkeeping is to be a complete record of all business
transactions, the criticism that may be made of the Cash
account as the only record is its insufficiency. For instance,
it does not show what was bought and what was sold.
Set a transaction involving a purchase or a sale of flour,
and ask, — " Can you think of any way to keep a record of
goods bought and sold?"
(The usual response is to insert explanation in the explana-
tory space.)
Our experience leads us to believe that this is the psy-
chological point to grasp the meaning of the generic term,
account.
Lead them to see that the Cash account is a systematic
collection of items, each one of which refers to cash, and
that all are gathered together under the title " Cash." But
why "systematic"? Because items having the same ten-
dency or meaning are segregated in a column reserved for
such items. Thus, money received from whatever source
and for whatever purpose is entered in one column, etc.
Next get them to frame definitions for the Flour account.
Corn account, etc., they are about to use. If their notions
are correct, — and let them see clearly that they are still to
test the correctness of their views, — we are ready for the final
step. This consists of deriving the conception of the term
1 68 Principles and Methods in Commercial Education
account. We would much rather relegate this task to a later
period, but it is well to take it up here, for else our students
would constantly use a term they do not even vaguely under-
stand.
By comparing the definitions tentatively adapted for a
number of accounts, we agree that :
An account is a systematic collection of items, each one of
which refers to a single idea (subsequently person, thing, or
name) and all gathered together under an appropriate title.
Now repeat the question regarding the purchase or sale of
flour.
They will answer, the Flour account. Place it on black-
board thus:
FLOUR %
Then have the class enter a half dozen purchases and sales
of flour.
What items are on the left or debit side?
They will readily see that flour received or bought, on
account of the analogy to the Cash account, is placed there.
A similar procedure will estabUsh the significance of the
credit side.
The detailed operation had better be illustrated :
Bookkeeping • 1 69
Write this transaction on the blackboard :
Bought 10 bbls. Flour at $7.50 = $75.00,
and require the entry for the same.
They will give the cash entry.
But this is not a complete record, because it does not
consider the flour. They will readily see the need of opening
a Flour account.
Shall we debit or credit this account with $75.00?
They usually give debit, which is accepted tentatively.
(Give few similar problems, also employing wheat and corn,
and involving both purchases and sales.)
They will then generalize these individual notions, resulting
in the following agreements :
A. I. — Debit Cash account for all money received by the
business, and at the same time
2. — Credit another account for the same amount.
And in a similar way :
B. I. — Credit Cash account for all money paid out by
the business, and at the same time
2. — Debit another account for the same amount.
They are now also ready to see that every business trans-
action is an exchange of equal values, and that bookkeeping
is the recording of such exchanges of equal values. They
will readily agree that no entry is complete until this double
relation has been recorded. But what is the name of a sys-
tem of bookkeeping which requires such a double entry?
Simply enough, double entry bookkeeping.
The class is now in a position to deduce the basic principle
of double entry bookkeeping :
Every Transaction must result in Debits and Credits of
Equal Amount
170 Principles and Methods in Commercial Education
EXPENSE AND MERCHANDISE ACCOUNTS
Salary account, Rent account, and Stationery account may
next be established.
The next steps may consist of a generalization whereby
salaries, rent, postage, etc., are grouped under the general
term Expense. In a similar way Merchandise account is
arrived at. Though the authors are in hearty accord with
Professor Charles E. Sprague's unanswerable argument that an
account which has to be made over should be made correct at
first, we do not advocate, at present, the teaching of Merchan-
dise Purchase and Merchandise Sales account, because the
change involves too great pressure upon the teacher dependent
upon the available elementary texts. In passing, however, it
may be said that the authors have conducted the suggested
experiment in one of their classes, with satisfactory results.
THE proprietor's ACCOUNT
Now that some conception of fundamental accounts has
been acquired, we are ready to go a step further. Though
the introduction of the proprietor's account at this point is
not sanctioned by that principle of pedagogy which requires
easy gradation from lesson to lesson, we are inchned to make
a desirable sacrifice, because when this account has been
mastered, complete sets for practice become possible.
We are ready to consider the method of presentation.
Set for solution an ordinary transaction involving a cash in-
vestment. Despite the fact that the class has been drilled
on the need of first deciding whether Cash account is to be
debited or credited, and then to consider the other account,
they will always hesitate at this problem. Suggest that the
Bookkeeping . 171
Cash account be dealt with first. Was this money received
or given by the business ? Here is the place to develop the
distinction between the proprietor and his business. The exer-
cise should include withdrawals and additional investments.
It is not deemed necessary, nor, indeed, will space per-
mit, to illustrate all the steps of a complete course in the
subject which forms the topic of this section. The syllabus
which is appended to this chapter suggests the order in which
the various divisions should be treated. Though there exists
very little doubt in our minds regarding the advisability of
a strict adherence to the suggested order in the beginning,
greater mobility is permissible, and probably desirable, in
the more advanced portion. In order to avoid the breaks in
the continuity of the narrative, and because the form and
method of the class-room question and answer device has
already been sufficiently indicated, the balance of these model
lessons will be in the narrative form.
PERSONAL AND OTHER ACCOUNTS
In the introductory paragraphs, the statement was made
that the pedantic rules to which we took exception might be
avoided. We propose to illustrate this point in connection
with personal accounts.
Commence this lesson by recalling the basic principle of
double entry bookkeeping. Then write this transaction on
the board : Sold to Thos. Jones, on account, 3 bbls. flour
at $8.00, $24.00. Your request for the entry will probably
result in Cash account. Debit, and Merchandise account (or
Flour or Merchandise Sales account) credit. Apply that
sobering influence, always at the teacher's command, the
question. What does the credit to Merchandise account
indicate? Was merchandise really sold? What does the
172 Principles and Methods in Commercial Education
Debit to Cash account show ? Was money actually received ?
If your bookkeeping is to be a truthful record, the cash entry
must be wrong. (Continue questioning, of course.) But
some debit is necessary. Agree to accept a debit to a new
account, that of Thos. Jones. EHcit that it is intended to
show that Mr. Jones owes us $24.00. Now to test the correct-
ness of our proposed solution, what should the Jones account
show after he pays us $10.00 on account? (Explain "on
account," if necessary.) Make the entry for this part pay-
ment using agreement A 2, and as Jones is the only possible
name of the " other account " employ it. Does the account
show a balance of $14.00? What does it now indicate? If,
next, he pays the balance in cash, what entry results ? What
does the account now show?
Set a similar problem in buying an account, and subse-
quently settling the same in cash.
They will now be ready to grasp the value of what, for the
lack of a better term, we shall call the '' Substitution Device."
It is : " When a transaction does not involve cash, assume
that it does ; proceed to debit and credit accordingly ; then
substitute for cash the name of the new account."
Illustrations (if they are already famiHar with the Journal,
the solutions are somewhat easier) :
I. Sale to Jones on account.
(a) The assumption of a cash sale gives :
Cash (debit) [(Debit) and (credit) unnec-
Merchandise (credit) essary, if they know the
Journal]
(&) By the process of substitution :
Jones
■ Cash (debit) [Note how the substitution
Merchandise (credit) is made by crossing out, etc.]
Bookkeeping i73
(c) To finished product :
Jones (debit)
Merchandise (credit)
Of course, in the beginning, and in more advanced work,
mere parrot-like memory may be combated by insisting upon
the reason for such substitutions.
2. A purchase from Smith on account may be treated
similarly :
Smith
Merchandise to - Cash .
3. Bills Receivable (Notes Receivable). A knowledge of
promissory notes is assumed, prior to the need for any book
entries involving these. Let us consider the following trans-
action :
Sold T. Jones, on his lo-day note, 5 bbls. flour at $8.00 =
$40.00.
After their mind is aroused to a feehng that some entry is nec-
essary for the note, they will not be satisfied with " a," below :
{a) Cash
Merchandise
The first appUcationof the Substitution Device will result in :
{h) Jones
Merchandise
But the final result will be :
(c) Notes
Merchandise
Now, tell them that bookkeepers employ the term Notes
Receivable or Bills Receivable, instead of " Notes," so that
the accepted entry becomes :
{d) Notes Receivable
To Merchandise
174 Principles and Methods in Commercial Education
4. Smith, who has bought goods on account, gives us a note
in full or in part settlement.
After bringing out the notion that the change from the
oral or implied, to the written, promise to pay is not a real
cancellation of the debt, proceed to the journaHzing by means
of the following steps :
Notes Rec.
a) Cash h) Cash c) Notes Rec.
Jones Jones Jones
Steps a and h are crutches of course. It will soon be found
that the solution may be performed mentally. Eventually,
the final solutions will become so familiar, by the operation
of the laws of association, that the student will lose sight of
the steps whereby they are derived. This state of affairs is
analogous to the situation found in other subjects. For ex-
ample, in algebra, the proofs of certain factoring processes are
forgotten whereas the result is remembered.
The Substitution Device is an effective crutch. It should
later be reconciled with, and abandoned for, the general
rule for debit and credit, namely, accounts are to be debited
for receipts or costs, and credited for disbursements or pro-
ceeds.
5. Discount (Interest or Interest and Discount and Mer-
chandise Discount) is treated similarly.
Discounted Jones' $500.00 note, due in 60 days, at Bank, re-
ceiving credit for net proceeds. (Face $500.00, Discount
$5.00, Net Proceeds $495.00.)
{a) Cash $500.00 (Is it true that you received
Notes Receivable $500.00 $500?)
(Is it true that you gave the
entire note ? How much
did you receive for it ?)
Bookkeeping
17s
therefore :
{h) Cash $495.00 (Recall the basic principle of
Notes Receivable $500.00 double entry bookkeeping, —
debits must equal credits.)
therefore :
{c) Cash $495.00
? 5.00
Notes Receivable $500.00
(To which account does the
$5.00 belong? Show that
a record of discount oper-
ation should be kept.)
{d) Cash $495.00
Discount 5.00
Notes Receivable $500.00
THE TRIAL BALANCE
Consider with class, on blackboard, the result of a num-
ber of transactions. The first transaction resulted in debits
and credits of equal amount, the second Ukewise. Hence, the
sum of the first two debits equals the sum of the first two
credits. Similarly, treat the third and the fourth transactions.
Suppose one of the debit entries of the series was omitted.
The equahty disappears. An important test, therefore, is
this equality. Have the class foot up the totals of the ac-
counts in their ledger. Write these down in the usual form.
This is called a Trial Balance of Totals. (Note : the techni-
cal term is not employed until the way has been paved for it.)
Why a trial ? Why of totals ?
This trial balance is an illustration of the mathematical
axiom : The sums of equals are equal.
The real Trial Balance, the practical one, should not yet
be developed. (See Syllabus.) It is inserted here for the
sake of convenience.
176 Principles and Methods in Commercial Education
Consider this account on the blackboard :
J. SMITH
600
300
200
200
What does the debit side show ? Credit side? How much
is the balance? What does it denote? How did you obtain
the balance? By deducting $400.00 from $900.00. This is
equivalent to deducting $400.00 from each side.
(Explanation : $900.00 — $400.00 = $500.00, $400.00 —
$400.00 = $0, therefore balance = $500.00 — $0 = $500.00.)
Next copy the Trial Balance first taught and leave two
extra columns.
The Cash account shows that
$3000 was received and $1200
paid out, therefore the debit side
is $1800 greater. Place in debit
balance column. Similarly for
the other accounts. In these
cases make use of the principle
just explained.
This is a Trial Balance of dif-
ferences or balances, always re-
ferred to as the Trial Balance,
because it is the only one used.
Here derive definition.
Dr.
Total
Cr.
Total
Dr.
Bal-
ance
Cr.
Bal-
ance
Cash
3000
1200
1800
Mdse.
1800
2100
300
Expense
ISO
150
R. Rollins,
Prop.
2000
2000
T. Jones
1800
500
1300
J. Smith
1000
1950
9SO
7750
7750
3250
3250
Bookkeeping 177
This Trial Balance is employed by business men because
they are not so much interested in how much money was
received during the year and how much was paid out, as
how much is now on hand, etc.
Show relation to another axiom of mathematics : If equals
are subtracted from equals, results are still equal.
JOURNAL
Have the pupils make entries for a half dozen transactions
dictated to them. If these transactions are of ordinary
difficulty, from 30 % to 60 % will be found to have made one
or more errors either of dropping a debit or a credit, or else
of transposition. To avoid such errors, the journal is used.
It is an indicator, — it indicates the entries to be made in
the ledger. Here develop use of posting or checking figures,
and introduce terms : journalizing and posting. Also, show
importance of book of original entry, and journal-daybook
combination, referred to as the Journal. The explanation in
the journal should develop conciseness and exactness of
expression. The test for such explanation is maximum in-
formation in minimum number of words, and the stranger's
abiHty to interpret the entry,
THE STATEMENTS
{A) Profit and Loss Statement :
This statement and the balance sheet should be set as more
frequent exercises than is usually the case.
The first few Profit and Loss Statements should not in-
volve any inventories. Consider them as arithmetical prob-
lems in loss and gain. Use one of the previous trial balances.
Recall that the object of bookkeeping is to determine the
178 Principles and Methods in Commercial Education
progress and condition of the business. The progress is the
answer to the questions: "How did my business do?"
" How is it getting along? " It is analogous to the term net
gain in arithmetic. To determine it (elicit all this) compare
all the accounts of the ledger which show gains or losses.
The difference between the sum of the profits and the sum of
the losses is the net gain (or net loss). Rapidly go down the
list of balances to ascertain what each balance denotes.
Assume that in a given illustration. Merchandise account
shows that we bought goods amounting to $1800 and sold
them for $2100, resulting in a profit of $300. But in order to
carry on the business we incurred expenses amounting to
$150. These expenses reduce our profits, hence the real or
net profit is $300 less $150, or $150.
The form of the statement is not regarded as of prime im-
portance. Once the student has succeeded in grasping the
essentials of a profit and loss exhibit, it has been found that
he can easily adapt his mathematics to the prescribed form.
Let us now consider the case of inventories. First, ask
questions which will tend to focus the mind upon the neces-
sity of considering this item. A question such as this is of
help : Bought a horse and wagon for $300 ; sold the wagon
for $125. Find the loss or gain. Some ridiculous answers
are, of course, to be expected. But the class will readily see
that nothing can be done until the cost of each item has been
determined. The method of determining the loss or gain on
merchandise is suggested by the following form :
Total cost of goods bought (debit side of Merchan-
dise account) $3000.00
Value of the unsold portion (Inventory) .... 500.00
Cost of the goods sold $2500.00
Bookkeeping 179
Selling price of the goods sold (credit side of Mer-
chandise account) $2800.00
Gain on Merchandise $300.00
The procedure in the case of expense is as follows :
Amount spent for expenses during (Expense
account) $250.00
Value of stationery, coal, etc. not used up (Inven-
tory) 50.00
Loss due to expense items consumed during $200.00
$300 minus $200 = $100, net gain
{B) Balance Sheet (Statement of Resources and Liabilities,
Statement of Assets and Liabilities) :
It is best to defer the term " Balance Sheet" until the books
have been closed, for until then the name is an arbitrary one.
Now that we know the progress of the business, i.e., how
much was made, we are ready to attack the other problem,
viz. that of the condition of the business. How much is the
business worth now? Set this to pupils in the form of a
problem in arithmetic. They will proceed as follows :
The proprietor invested $3000.00
His net gain is 100.00
Therefore the proprietor now has $3100.00
We will here describe, as briefly as possible, one of our
means of directing the minds of a class of young students to
the consideration of the problems involved in the business
and financial statements. In illustrating the Cash account in
the first lesson we may have referred to Robert Lake, who
decided to sell, say, the Thursday Evening Post, in order to
make some money. As we followed his progress, he had
bought a bicycle to assist him in covering his route, had
estabHshed a good reputation so that the news agent would
i8o Principles and Methods in Commercial Education
deliver his magazines to him and wait for payment until the
following week. Bob also had a number of customers who
paid him by the month. In ascertaining Bob's net gain, as
the business increased in complexity, the class saw the need
of considering the unsold magazines which could be returned
at cost, and his various expenses such as postage, car fares
on rainy days, bicycle repairs, etc.
This simple illustration is also of help in estabHshing the
Balance Sheet. After finding how much Bob was worth by
the method already shown, we get the class to attempt an-
other solution from a Trial Balance of Bob's business shown
on the blackboard, to which is added the inventory of his
unsold stock. Besides the expense accounts the Trial Balance
consists of Bob's investment account, the bicycle account,
the accounts of his customers, and the balance due to the news
company. In the simplest forms, the present worth consists
of the cash balance. Subsequently, there is added to this
the inventory of unsold magazines, the value of the bicycle,
and the customers' balances. From the total there is deducted
the credit balance due to the news company. The inventory
is further elaborated by the addition of such items as unused
postage and stationery. It may be said, in passing, that
this illustrative work takes very much less time than might
be inferred from the space required for its description here.
After this has been done, by questions such as those which
are suggested by the items taken into consideration when
discussing the richness of a country (its resources), we derive
the term Statement of Resources and LiabiHties, or, better,
Statement of Assets and Liabilities. But as the illustra-
tion is only a means to an end, it should therefore be fol-
lowed up by an exercise or two on the drawing up of such
statements.
Bookkeeping i8i
Closely following upon this work is an exercise of great
disciplinary value. Each student should have before him a
Trial Balance, the inventory items, and the resulting state-
ments. If time permits, it is well to have these on the black-
boards also. Assign the task of finding any item in the Trial
Balance which does not appear on either of the two state-
ments. Pupils will point out the proprietor's account and
the items to which the inventories refer. Consider expense
account. Which amount appears in the Statement of Assets
and Liabilities ? Why? Notice that every item in the asset
column of the Balance Sheet denotes something of value to
the business ; every one in the liability column, something
that the business owes. Hence everything of value owned
by the business is an asset, everything owed is a liabiHty.
The difference between what the business owns and what it
owes is the present worth. This present worth is the pro-
prietor's net investment plus the net gain. It may then be
seen that every item on the debit side of the Trial Balance
(taking inventories into consideration) is either an asset or a
loss. Test : Does this item represent anything of value be-
longing to the business ? If it does, it is an asset ; if not, it
is a loss. Similarly, on the credit side, every item is either a
liability or a gain. These conclusions need not be memorized
if two type accounts are constantly used as touch stones :
Cash account for assets and liabilities (a debit balance is a
resource; a credit balance, a liability).
Expense account for losses and gains (a debit balance is a
loss; a credit balance, a gain).
FORMULAS
The previous exercise should lead to certain formulas.
The value of such expressions is not generally recognized in
1 82 Principles and Methods in Commercial Education
the teaching of bookkeeping. Here full play to the inductive
process is to be allowed. As a result of their profit and loss
statement they should derive G. — L. = N. G. (gains minus
losses equal net gain).
The balance sheet should lead to A. — L. = P. W. (assets
minus liabilities equal present worth).
The following formulas may also be derived :
L. - G. = N. L.
N. I. + N. G. = P. W. (net investment plus net gain equals
N. I. - N. L. = P. W. present worth).
P. W. - N. I. = N. G.
N. I. - P. W. = N. L.
It is understood, of course, that not all of the above are to
be taught in a single lesson, but each in its appropriate place.
In this connection, or perhaps in the lesson on Balance
Sheets, the distinction often pointed out by Professor Sprague
must be emphasized. It is not true that in the Balance
Sheet, or anywhere else except under the most unusual cir-
ciunstances, that the assets are equal to the Uabihties. The
true equation is A. = L. + Proprietorship.
INTRODUCTION OF SPECIAL BOOKS
The Sales Book. — • The cash book is usually presented first,
but all must agree that the sales book is the simpler of the
two.
Method. — Give a list of six sales transactions, and request
their journalization and posting. Now consider the credit
side of Merchandise account (or Merchandise Sales account).
What is the total ? Ask for suggestions to simplify the post-
ing operations. Some will offer to post the total from the
journal in a single amount. Is this practicable in view of
Bookkeeping 183
the fact the sales are not usually successive entries as in this
case ? Why not reserve a few of the journal pages for sales ?
Then, why repeat " Mdse." for each credit? Can it be indi-
cated in some other way? How about writing on the top of
this reserved section of the journal " For each of the follow-
ing items credit Merchandise account"? Then show the
Sales Book in the text and frame questions until the book is
understood, including the posting of the totals. Follow this
up by having the six transactions entered in the sales book
and posted. Other similar exercises may be set, if necessary,
before assigning a set involving the use of the sales book.
THE CASH BOOK
In a manner analogous to the method already shown,
deduce the desirability of segregating the cash items of the
journal so as to avoid the necessity of writing " Cash " for
each transaction and the posting of each separate item. The
next step is ordinarily found a difficult one.
Assume that one entry in the journal is :
Cash
Ck. on account
$100.00
R. Smith
$100.00
and the other :
Expense
April store rent
60.00
Cash
60.00
The question is how to utilize the journal so as to avoid
the repetition of the term " Cash " and the individual post-
ings. Pupils will soon see the need of separate pages for cash
receipts and cash payments. It may be necessary to tell
them that the left side should be used for the receipts while
the adjoining page should be employed for the payments.
Arrange this roughly on the board, and get them to see that
184 Principles and Methods in Commercial Education
" R. Smith " on the debit side is to be posted to the credit
side of his account. Do not make this an arbitrary rule, but
help them to frame it themselves. Remember that the
journal was introduced as a convenient indicator of the sub-
sequent entries in the ledger ; the cash book is a substitute
for a portion of the journal, — it still indicates though not in
the same direct form, and the result in the ledger must be
the same. The explanation space gives no trouble.
It is sometimes found necessary to have pupils " label "
their columns in the cash book and in other books, though the
use of such a crutch is not to be encouraged when no longer
necessary. The debit side would appear thus :
{Cash Dr.)
CASH RECEIPTS
Date
AccT. TO BE Credited
Explanations
Amount
It seems unfortunate to us that the general practice among
bookkeepers is to exclude the Cash account from the ledger
entirely when a cash book is used. The implied theory is
simple enough. The rational method would be to continue
the ledger as the book of accounts, the Haupthuch of the
Germans. The posting of the monthly totals is a simple
procedure, and then the ordinary definition of a Trial Balance
would be more correct, and there would be less likelihood of
Bookkeeping 185
omitting the cash balance, a cause of prolific worry to the
beginner.
INTRODUCTION OF SPECIAL COLUMNS
Special columns in the cash book offer no great difl&culty.
We suggest a column on the credit side for expense account
at first. Direct the attention to the cash book and to the
fact that, say, eight separate postings to expense account
were made. Next ask for suggestions to simplify the work,
referring to previous simpHfications. If necessary, hint at
the second money column which had previously not been
used at all except for closing totals. The posting of the
total of expense and its addition to the general column can
be handled easily, and offers no difficulties.
We beheve that discount on sales should be the account
for which the next special column should be introduced.
The process has been indicated in connection with the expense
column. The matter of posting alone requires special con-
sideration. Here the journal form, as in so many other cases
involving bookkeeping reasoning, will be of aid. Consider
the first item. If no cash book had been used, the journal
entry for the transaction would have been of the following
type:
Cash
Merchandise Discount
R. Jones
Evidently Merchandise Discount account is to be debited.
The conclusion is thus clearly indicated : the total of the
entire column is to be posted to the debit side of the account.
In this connection, it is often the case that some student thinks
he has discovered an exception to what he will probably call
i86 Principles and Methods in Commercial Education
the rule of posting, viz., items from the debit side of the cash
book must be posted to the credit side of the account indi-
cated. A little questioning will soon clear up the doubt.
CONTROLLING ACCOUNTS
It would be well for the teacher who is not familiar with
accounting to look up the theory of controlling accounts.
The advantage of this device need not be enumerated here.
It will be sufficient to suggest that the need and method of
operating these accounts may easily be developed by employ-
ing the methods previously outlined. The subject will be
treated of more fully in the next chapter dealing with Ac-
counting.
CLOSING THE BOOKS
Most teachers find the closing of books a most unsatis-
factory series of lessons. If the reader, who is famihar with
the teaching of bookkeeping, stops to consider the problem
for a moment, he will find in the apparent difficulty involved
an example of what we meant in one of the earher paragraphs
by the unsatisfactoriness of copying models and learning by
rote.
Let us assume that the pupils are already famihar with the
balancing of the Cash account or the cash book, or both, and
know that the bringing down of the balance is a matter of
convenience. Also, that they know the conventional mean-
ing of the single line (in bookkeeping the sign of addition)
and the double line (completion and extended sign of equahty
between the sides). They have also practised the conven-
tion of closing on the same line by keeping their rulers fixed
while marking the fines in the debit and credit columns. It
is quite immaterial whether red ink or black ink is employed
Bookkeeping 187
in the ruling process, aside from the aesthetics of the question,
for there is a noticeable tendency to do away with red ink
in modern commercial houses.
The statements should be before the class. These show
the condition and the progress of the business. Let the class
observe that the proprietor's account does not agree with the
present worth. In order to reconcile these two it is necessary
to add the net gain to the credit side of this account. But
how shall this be done? Some will suggest that you merely
write it there. How about disturbing the equality between
the debit and the credit sides as revealed by the Trial Balance ?
In this way show the need of some systematic way of getting
the ledger to show the condition as exhibited outside of the
books, in the statements. The final purpose of the Merchan-
dise account is to show the profit on trading. What was done
with this gain in the statement? In the ledger, we must
open a temporary account known as Loss and Gain, to which
we carry the separate losses and gains in order to determine
the net gain. To transfer this gain from the Merchandise
account to the Loss and Gain account make the following
journal entry :
Merchandise. (To transfer the gain shown by
Loss and Gain Merchandise account, to
the Loss and Gain account.)
If Merchandise Purchase and Merchandise Sales account
were used, one would be transferred to the other in a similar
way.
In an analogous manner, we close other accovmts showing
losses and gains. It is thus seen that red-ink entries are not
necessary. They may be used, of course, but their explana-
i88 Principles and Methods in Commercial Education
tion is artificial and not in accord with modern accounting
principles which require full explanations for all entries.
The Loss and Gain account now shows the net gain. Who
is entitled to it ? How can it be transferred to the proprietor's
account? Use the journal entry form, the question suggests.
Those who know how to balance a Cash account, will find
no difficulty in closing the proprietor's account.
When inventories are given, the work just outlined is more
complex, but the principles are the same.
Not much has been said thus far about the closing of per-
sonal accounts. Entirely too much time is spent on this
subject. The reasonably extensive business experiences of the
authors incline them to believe that very much less of such
closing is required in business than would be indicated by the
time usually devoted to it. It is a question of values. We
advocate that personal accounts be not closed until much
later in the course than is usually the practice.
DRAFTS
Inasmuch as a full discussion of the business practice side
of drafts will be found in another connection (p. 138), we here
assume that this phase of the subject has been presented before
the question of proper bookkeeping entries arises.
(A) Bank Draft. — Receipts of bank drafts are handled
just as checks and money orders. When we send them, the
explanation space is the only place where the difference be-
tween such a remittance and a check is shown. The charge,
if any, is debited or charged to Expense account or to Ex-
change account or to Collection and Exchange account.
(B) Sight drafts drawn by us or on us offer no difficulty.
(C) Time Drafts. — (i) Drawn by us in our favor to facili-
tate collections.
Bookkeeping 189
This is equivalent to a written promise to pay us a certain
sum of money. But such promises are called Bills or Notes
Receivable. Hence the entry.
(2) Drawn on us in drawer's favor. These are equiva-
lent to Bills or Notes Payable, and should be treated accord-
ingly.
(3) Drawn by us in favor of a third person. Analysis will
disclose that this transaction is equal to two others ; a prom-
issory note received by us from the drawee, and then trans-
ferred, by indorsement, to the payee. Show that the entries
for the latter transactions include a debit and credit of the
same amount to Bills Receivable account, and that as these
entries just cancel each other there remains the charge to the
payee and the credit to the drawee or acceptor.
(4) Drawn on us in favor of a third person. This trans-
action is equivalent to No. 2 above. Emphasize the fact that
the payee is virtually the agent of the drawer, and that it is
immaterial to us to whom the actual delivery of the payment
is made, provided it is on behalf of the drawer. An analogous
point should be brought out in connection with No. 3.
As an aid to the pupil's understanding of three-party drafts,
questions should be framed directing his attention to the
business relationship existing between the parties before and
after acceptance. A good drill consists of requiring the en-
tries for all the parties involved at the time the draft is drawn,
accepted, discounted, paid.
EXERCISES IN THE CONSTRUCTIVE IMAGINATION
Before concluding these lessons, we wish to illustrate how
this valuable faculty may be developed in the bookkeeping
room. Only a few examples will be given because the reader
can readily think of others for himself.
iQO Principles and Methods in Commercial Education
Fill in the explanations for the following entries :
(a) Expense (b) Expense (c) Expense
Cash Merchandise Merchandise
Cash
(d) Salary (e) Horses & Wagons (J) Cash
Merchandise Smith & Co. Expense
It is not necessary that all of these entries be the result of
probable transactions ; it is an exercise sufficiently potent of
good if the students utiUze their imagination to the extent
necessary to supply the explanations called for. The fact
that there is a possibility of many different solutions adds to
the value of these exercises.
Another set consists of two Balance Sheets at the end of
two periods. The problem is to find what tendency the busi-
ness exhibits by the changes shown. If the statements are
simple enough, this exercise does not trespass on the domain
of elementary accounting.
Another set of exercises consists of the setting for solution of
original problems. The results should always be stated in
journal form because of the tangibleness of such entries, and
the ease with which they may be transferred to the special
books. A few suggestions for such exercises are the follow-
ing:
1. A partner who is entitled to cash salary, but who does
not draw it.
2. Donation of goods to some charitable institution.
3. A customer who has been overcharged requests and re-
ceives an allowance.
4. Where controlling accounts (Accounts Receivable and
Accounts Payable) are kept, purchasing goods from a customer
to fill out an order.
Bookkeeping 191
5. As an accommodation, exchanging of checks or notes.
6. Goods destroyed by tire not insured, or goods stolen.
SPECIAL DEVICES
The successful teacher draws upon his entire world experi-
ence to enrich his class-room work. Just one suggestion to
indicate how apparently extraneous matter may be made to
serve his purposes. In his college mathematics he became
familiar with graphic algebra. How few of us have ever
thought of utilizing this knowledge ! Yet a few exercises in
plotting curves would put a most valuable power at the service
of our pupils. Their familiarity with this subject would en-
able them strikingly to illustrate the efficiency of salesmen, the
tendency of factory costs, the progress of the business over a
period of years, and many other important business matters.
THE ETHICS OF BOOKKEEPING
We have come to agree that every oral recitation, and almost
all written work, should be a recitation in EngUsh. We have
yet to learn the value of the various commercial subjects as
indirect means of moral training. A single illustration must
suffice to open up the possibilities of bookkeeping as a study
which has its informal bearing upon the moulding of the ethical
man. Some of our students will copy from their neighbors
(who have different price lists). Some of them have been
known to force their balance ! But some subsequent trans-
action, some later statement, will reveal an inconsistency
which will eventually point out the source of error as residing
in some previous careless or dishonest step. The fault,
whether it be of morals or of the will, must inevitably cause
trouble. We cannot escape it. This ethical lesson of book-
keeping is made available in the class room sooner or later.
192 Principles and Methods in Commercial Education
The teacher who is awake to his full duty will make the most
of his opportunity.
CONCLUDING REMARKS ON SPECIAL METHODS
{A) The Class-room Recitation. — Inasmuch as some part of
the work in bookkeeping must be done at home, it becomes
of moment to decide what division shall be made with reference
to class recitation and home tasks. As a general proposition
all new work should be developed in school. We know of no
greater incentive to serious effort on the part of the student
than that which comes from the emulation fostered by the
oral recitation. We advocate that the problems involved in
the transactions should be solved by the pupils at home or on
the blackboard, and that these solutions should be criticised
by the class. The writing up of the books could very prop-
erly be done at home, subsequently. No extended comment
need be made, we think, regarding the necessity for some in-
dividual instruction in this subject. We venture to predict,
however, that the vicious practice of all individual work, so
long deemed the only means of imparting a knowledge of
accounts, will soon give way to the orderly class-room method
which obtains in other subjects of the curriculum.
{B) Preparation at Home. — As was stated under the last
heading, the home is the place par excellence for the entering
of transactions, the posting, and most of the routine work. It
is true, of course, that all home work is open to the possibility
of fraud. But it has been our experience that the develop-
ment of a proper esprit de corps, and the right kind of a talk
or two, will remedy the potential evil of copying. Whenever
it is expected, and when other means fail, a little skilful ques-
tioning on the work not done honestly will reveal the futility
of the practice and discourage it. The general principle
Bookkeeping 193
which should decide the teacher in the separation of home
from class tasks has already been given. It may be restated
in a different form. The recitation period is too valuable
to be taken up for work which may just as well be done away
from the instructor's supervision. But nothing that has been
said here must be construed as in opposition to the doctrine
that eternal vigilance is necessary in order to keep our students
in the right path. Their work must be inspected constantly,
so as to nip carelessness in the bud and error in the making,
for all of us recognize how much harder it is to turn over a
new leaf than to commence properly.
(C) Reviews. — Teachers have often admitted that reviews
are so trying and hard, that they either set examinations in
Heu of them or else just continue the course. But reviews
are pedagogic necessities ; so, because of their exceedingly
great value to clinch the essentials of a series of lessons and to
enable the instructor to know how effective his teaching has
been, this chapter would be incomplete without some con-
sideration of the topic.
Let us first distinguish between quizzes and reviews. The
former consists of a series of questions on work previously
taught, arranged in any manner, without any necessary recog-
nition of that which is of permanent value ; and, except in
professional schools, it is usually associated with coaching
and cramming. Even under the most ideal conditions its
chief function is to test. On the other hand, the review is a
most important aid to the teacher. It enables him, by a
series of well-planned questions, graded in the order of logical
development, to emphasize the principles of a topic, and to
drive home the general ideas connected with a subject rather
than the details. It is the means whereby the last appeal to
the permanent memory is made ; it aims to bind the associa-
194 Principles and Methods in Commercial Education
tion processes in the final attempt to make this matter an
organized part of the mind. Hence, it is not enough to plan a
series of questions to which answers are expected ; the teacher
must so elucidate these replies that the subject-matter is as-
similated by the class.
(D) Examinations. — The subject of formal examinations
has been much discussed of late. Many arguments have been
advanced against them ; probably as many have been offered
in their favor. The evils of cramming may be avoided, and
as some sort of tests are almost universally accepted as nec-
essary, it behooves us to prepare such papers as will minimize
the bad features and embody all of the good ones.
Teachers of bookkeeping are fortunate in that their sub-
ject lends itself to examination which really tends toward
development of power on the part of the student. It is well
to have some examinations come unexpectedly so as to pre-
pare pupils for the emergency calls of real life, but with these
we do not now concern ourselves.
Formal examinations should come after reviews. They
then make possible the expression without which the impres-
sion is always more or less vague and indefinite. In this
sense, they are a positive teaching aid. The questions should
not consist of definitions and rules, because preparation for
these foster the cramming process. They should consist of
problems which require real thought. For example, the prep-
aration of statements from trial balances calls for discrim-
inations and comparisons. Such questions as " Why does
the expense account show a debit balance? " is of greater
value than " Name two accounts which always show a debit
balance." The first calls for reasons, the second may be
guessed at or easily crammed for. Instead of setting questions
on journalizing transactions which are familiar, make pupils
Bookkeeping 195
apply their general and fundamental knowledge by proposing
such work as that contained in the section, Exercises in the
Constructive Imagination, page 189.
The relative weight which the final examination results
should have in comparison with that allowed for class recita-
tion and book work cannot be decided easily. It appears to
us that it is unwise to give the former greater importance than
is attached to the term's work. But as this subject is more a
matter of school policy than of class management, it is per-
haps better not to discuss it here.
SYLLABUS
The following syllabus is offered as a suggested course of
study for schools which offer the course outhned on page 53.
It is not expected that every teacher will wish to follow the
order here outhned, but it may be said in passing, that the
sequence is the one we decided upon after ample experimen-
tation. Reviews and tests are not indicated, because many
conditions arise which make advance plans for them inap-
pHcable.
It is presumed that exercises involving the topics to be
studied are available in the form of text-books or otherwise.
Exercises requiring special journal entries for unusual trans-
actions, and for such matters as consignment, shipments, etc.,
are not inserted, because it was deemed best to leave this
matter to the ingenuity of the individual teacher.
{A) Cash Account. Debit and credit. The account. Merchandise
and expense accounts. The ledger. Principles of double entry book-
keeping. Proprietor's account. Trial balance of totals. Buying on
account. Cash payments in settlement. Selling on account. Cash
payments in settlement. Buying and selling on account with part pay-
ments and subsequent settlements. Trial balance of differences. Exer-
cise in profit and loss. Exercise in present worth. Relation between
196 Principles and Methods in Commercial Education
these two. The journal. Posting. Exercise in profit and loss, etc.,
involving merchandise inventory. Notes Payable account. Notes
Receivable account. Discount account (Interest and Discount account).
Compound journal entries. Merchandise Discount account. Inven-
tories involving expense accounts. Closing of books. Sales book.
Cash book. Check book. Bank Pass book. Bank drafts received and
given. Special columns in cash book: (i) Expense, (2) Merchandise
Discount on sales, (3) Merchandise Discount on purchases. Special
column for cash sales in sales book. Bill book. Two-party draft drawn
on us. Drawn by us. Three-party draft drawn on us. Drawn by us.
It is our belief that the work thus far should not involve
the *' budget " or " vouchers." The presentation of the above,
with time for review, and with the use of practice sets such
as previously outlined, should take from five to six weeks of
the time shown for bookkeeping in the second year of the
course outlined on page 53. Though we recognize the value
of the pedagogic doctrine which emphasizes the learn-to-do-by-
doing slogan, we are not carried away by its pleasing sound.
Our experience justifies the emphatic stand we take against
introducing the vouchers too early in the course. Nor will
the pupil lose very much by not having the business forms at
once ; for aside from the compensating advantage accruing to
him from the concentration on the bookkeeping alone, it is
to be remembered that he has had much practice in the very
forms included in the budget.
A good set, calUng for the use of all ordinary business papers
involved, should next be worked. It should not take more
than three weeks at the utmost. That this period is suffi-
cient should be clear to those who recall our tests of a good
set. Is it not a fact that ten invoices carefully handled are
as efficient as forty- three ?
(5) Single Entry. Books used. Show dependence on double entry.
Proof balance (instead of trial balance). Change to double entry.
Bookkeeping 197
Comparison between the two systems. No business forms need be
employed.
(C) Partnership. Historical introduction. Importance of articles
of agreement. Opening entries: (i) Cash investment, (2) complex
investment, (3) combining two single proprietor concerns (neglect
closing entries) . Salaries of partners. Personal drawings. Dissolution.
Change from single proprietorship to partnership. Admission of another
partner. Here introduce Accounts Receivable and Accounts Payable,
the special columns involved, and the special ledgers.
iP) Corporations. Historical introduction. Opening entries involv-
ing such accounts as Subscriptions, Capital Stock, Unsubscribed Stock.
Change of single proprietorship to corporation. Change from partner-
ship to corporation : (i) Opening of new books, (2) closing old books
(skip to senior term). Transfer of stock. Dividends. Introduction of
new books involved. (See law of your own state for essentials.)
After the first business practice set, such additional sets
should involve special kinds of business. Two general
principles should decide our choice :
{a) A business of such a general nature that its principles
once grasped become available as an easy introduction to
another.
{h) The special needs of the locality or of the pupils in the
class.
According to the selective principle involved in "a," a
retail trading concern, such as a grocery or provision house,
should be chosen. In addition, the books of a wholesale
concern, such as a dry-goods dealer, should be studied. This
should be followed by a set illustrating the contracting busi-
ness, — for example, that of a builder. The last of the gen-
eral sets should involve some manufacturing line, so as to
introduce the elements of cost accounts. Here it may not be
amiss to caution the inexperienced teacher against giving all
of the so-called voucher system of accounting as is shown in
a number of the more popular texts. Any acquaintanceship
198 Principles and Methods in Commercial Education
with actual business conditions will reveal the tendency to
reduce much of the work shown by the book vouchers, and,
moreover, the subject is better treated in the accounting
course.
Our final word is in regard to the special sets which the
school may offer. It is obvious that the demands of every
one cannot be suppHed. The general principle, however, is
simple enough. Decide upon the " sets " you can offer, and
allow them in groups; for in this advanced work, individual
instruction should have its fullest scope. The material now
generally available will permit the giving of courses in banking,
stock brokerage, professional accounts, the accounts of trus-
tees and executors, commission and department store account-
ing. Finally, some member of the section engaged on a
special set should report on its salient features to the entire
class.
SUMMARY
It is wrong to assume that because the principles of a sub-
ject remain unchanged that the practices growing out of
principles are static. Bookkeeping, in order to meet the re-
quirements of modern business, is undergoing rapid changes.
The modern teacher, in order to remain efficient, must keep
abreast of the times. But though the forms of books and the
kinds of accounts may undergo change, the basic aim involved
in the teaching of bookkeeping is quite fixed. As a matter of
fact, the first problem which a successful teacher must solve
concerns itself with the purpose, aim, or motive for the teach-
ing of bookkeeping.
Modern educators are agreed that not because of its utili-
tarian value alone, but also because of its disciplinary value,
bookkeeping deserves the position of major subject in the
commercial course which it now occupies.
Bookkeeping 199
Most of the present chapter is devoted to a discussion of
the methods of presenting the subject of bookkeeping. The
deductive method proved stultifying, but the inductive was
found most fruitful of good results. Rules should be evolved
by a process of discovery, and mere memoriter work should
be discouraged. " That which one understands, one need
not memorize."
A number of model lessons are presented. These take up,
in outHne, the first lesson in bookkeeping, debit and credit
and double entry ; the trial balance ; statements ; the use of
formulas; special books, and special columns in books of
original entry. Exercises in the constructive imagination,
the use of certain special devices, and the ethical value of
bookkeeping instruction are included in the chapter. The
syllabus which concludes the chapter will be found to meet
the requirements of the best business courses.
EXERCISES
GROUP ONE
1. In presenting the subject of bookkeeping, what motivating devices
would you employ ? (How would you show that the subject is worth
while ?)
2. Discuss the relative merits of the account method verstis the joiurnal
method of introducing bookkeeping.
3. How would you employ the blackboard during the bookkeeping
recitation ?
4. In selecting the text-book, what features would appeal to you
most?
5. What use would you make of a text-book in bookkeeping ?
6. Prepare an outline for an oral review of the Sales Book.
7. Discuss the value of formulas, with special reference to book-
keeping.
8. Write an essay of about two hundred and fifty words on the
ethical value of bookkeeping.
200 Principles and Methods in Commercial Education
9. Which do you favor, individual or class instruction ? Give your
reasons in full.
10. Discuss the budget or business practice method of bookkeeping.
State its strong points and its weak points.
GROUP TWO
1. Outline the first ten lessons in bookkeeping. Present a plan in
sufficient detail to enable a young teacher to conduct a class in accordance
therewith.
2. Assume that a beginner's class was divided into three groups of
fifteen pupils each, and develop a plan whereby all pupils would progress
as a unit, while weak pupils would receive special attention and strong
pupils would obtain sufficient drill.
3. Outline, in full detail, a lesson on the Cash Book.
4. Criticise the syllabus in bookkeeping of any high school with which
you are familiar, and suggest remedies.
5. As a result of a survey of the New York public school system the
Hanus Committee contributed a number of reports. Among these,
the Thompson Report deals with commercial education. Obtain a copy
of this report, and apply its conclusions to the school system with which
you are connected.
BIBLIOGRAPHY
Bogle, A. M., Comprehensive Bookkeeping. New York, Macmillan Co.,
1905.
Miner, G. W., Bookkeeping. New York, Ginn & Co., 191 2.
Montgomery, J. L., Modern Bookkeeping and Business Practice. New
York, C. E. Merrill Co., 1906.
Neal and Cragin, Modern Illustrative Bookkeeping. New York, Amer.
Book Co., 1911.
RowE, H. M., Commercial and Industrial Bookkeeping. Baltimore,
H. M. Rowe Co., 1899.
CHAPTER VII
Accounting
Comparatively few people are able to distinguish between
bookkeeping and accounting. As a matter of fact, the two
terms are very often employed synonymously by the business
man. This confusion has been aided by those who should
know better, as witness the self-styled " expert accountant,"
" pubHc accountant," and other such appellations employed
by bookkeepers who wish to lend the impression that they are
as quahfied as the certified public accountant whose abiHty
has been attested to by state officials competent to pass
judgment in such matters. But despite the absence of a
clearly defined fine of demarcation between the work of the
bookkeeper and the sphere of the real accountant, an attempt
will be made to clarify our ideas regarding these terms. We
quote from a recent pamphlet : ^
What is meant by an Accountant?
He is not an expert bookkeeper, though every accountant knows
bookkeeping thoroughly. He devises and installs systems of accounts,
and, having done so, the bookkeeper continues the task of "keeping"
the books — that is, recording the transactions of the business. Then,
the accountant reviews or audits the work to establish its correctness.
In times of uncertainty, or whenever unusual conditions arise, he is called
upon to act as an investigator and as a commercial or business counsellor.
Another way of approaching the subject under review, that
is, the difference between bookkeeping and accounting, is to
1 " Accountancy and the Business Professions," by Joseph J. Klein, prepared
for the High School Teachers' Association of New York City, New York, 1911.
202 Principles and Methods in Commercial Education '■
consider the points of view from which the bookkeeper and
the accountant each regards the transaction arising for treat-
ment. The bookkeeper knowing that the basic principle of
his science is the maintenance of debit and credit equality,
is satisfied by an entry for any given transaction which results
in such an equation. The accountant, while also observing
the fundamental principle of double entry, goes a step further.
He not only insists upon the equality, but also upon the
charge or credit to the correct account or class of accounts.
In other words, the accountant is continually on the alert for
a distinction between capital and income. An illustration
or two will be of assistance now. After using a shop for a
time, it is found that it requires painting. The expenditure
amounts to $200.00. The bookkeeper would credit cash,
and, in many cases, would be satisfied with a debit to some
such capital or real account as Building, Plant, or Real Estate.
The charge of the accountant would be to an income or nomi-
nal account as Repairs or Expense. One other example may
prove profitable. The cost of shoeing or stabling horses is
sometimes charged to an account of the form Horses and
Wagons, whereas it should be entered in the Stable Expenses
account.
This distinction between capital and income is of prime
importance. It has been made the subject of legislation by
public service boards and railway commissions. The con-
fusion of classification has enabled bankrupt corporations
to declare dividends, has helped to create so-called secret
reserves, and, when due to ignorance, has been known to lead
to further loss in ventures which should have been discon-
tinued long before.
The failure clearly to differentiate between these two im-
portant divisions of accounts may be understood in another
Accounting 203
way. Inasmuch as the bookkeeper aims at a trial balance
while the accountant works for the balance sheet, we can
easily see why it is that the former often errs in the manner
indicated. A charge to an incorrect account will not be dis-
closed by the trial balance, but will make a difference in the
showing of the amount of profit for the period under review,
and therefore on the balance sheet. We may thus sum up the
great distinction between bookkeeping and accounting as
residing in a difference in the ends aimed at, — the former
striving for a trial balance and the latter for a balance sheet.
Quite unconsciously, too, the texts on our subject corrobo-
rate our conclusions. Elementary bookkeeping books almost
invariably illustrate by means of journal, or what is prac-
tically the same in result, by means of ledger entries ; Pro-
fessor Hatfield, in his remarkable work on Modern Accounting,
adheres to balance-sheet results throughout.
We recall that not so very long ago it was held that when a
town or county had made provisions for a free elementary
school education, it had cancelled all obligations in one direc-
tion. High schools and colleges were only for those who were
able to pay for tuition. In this matter of free education a
great change has come over the country. Many communities
provide free college opportunities, though sentiment is not yet
universal in this matter. Industrial education, together with
a reaHzation that a country can make no better investment
than in a general educational upUft, has paved the way for
inclusion in our general scheme of free education, of subjects
which can be applied to the earning of a Hvehhood. It is
true that not many communities offer free professional train-
ing except for teachers, nor do we stand ready to advocate
what is apparently a radical departure from current practice.
But we must give some attention to the tendency to modify
204 Principles and Methods in Commercial Education
the high school curriculum so as to emphasize more largely
industrial and commercial training.
Notwithstanding the fact that many private schools teach
bookkeeping and other business subjects, many cities and
towns feel justified in offering what at first sight appears a
dupUcation of these private activities. That the duplication
is not real is known to all who are in a position to compare
the cultural and practical work of the modern high school with
the narrow technical courses of most private business schools.
But though no defence is any longer necessary on behalf of
bookkeeping as a proper subject of instruction in the free high
school, does the argument apply to accounting as well? Yes
and no. It would not apply to a professional course in ac-
counting for a reason which the authors do not personally
sympathize with, but which excludes courses in law, medicine,
and engineering, for example, from our free-school systems.
But a one-year course in accounting, such as outlined in our
suggested syllabus, cannot be excluded on the ground that it
is professional. Just as communities feel justified in offering
work in commercial law, physiology and hygiene, and in the
elements of mechanics or drafting, they are also justified in
offering the course in accounting which we suggest for the last
year of the high school course.
The reasons, then, for the inclusion of accounting in the
curriculum may be summarized both negatively and posi-
tively. In the first case, precedent exists for the giving of
such work in the fact that many localities are already engaged
upon similar work bearing a like relationship to corresponding
professions as does tliis one to public accounting. The posi-
tive argument is by far the stronger, and would exist even in
the absence of a pronounced tendency in the direction of a
more liberal poHcy toward universal education at the common
Accounting 205
expense. Germany has shown how general training in all
practical lines reacts to the advantage of the community.
In a thousand and one ways would the general understanding
of accounting react to the country's good. The examples
which suggest themselves would carry us too far afield. A
few must suffice us. Such training would do much to decrease
the number of dupes who are annually ensnared by mean-
ingless statements and prospectuses issued by fraudulent
mercenary operators and other schemers. In civic progress,
too, the beneficial results would be felt. The demand for
proper municipal accounting would soon become too insistent
and impatient to be longer ignored, and the responsibility of
public officials could then be more accurately and correctly
gauged.
If it is now clear that accounting should be included in the
high school curriculum, and if, furthermore, its great impor-
tance has been established, why should it not be offered rather
in the first year of the course than in the last? This question
might be asked us by those familiar with the fact that over
50% of those who enroll in our public high schools drop out
by the end of the freshman term. Obviously, accounting
cannot be studied without an understanding of bookkeeping,
so that this prerequisite imposes the necessity for relegating the
study of the more advanced topic to a later period of school
fife. Moreover, an appreciative understanding of account-
ing presupposes a certain maturity not present in boys and
girls prior to about their senior year of the high school course.
ReaHzing that the distinction between bookkeeping and ac-
counting is sufficiently real as to warrant separate treatment
of each, and having estabhshed the fact that the latter subject
should follow the former, a concluding line of inquiry remains
for treatment. This final division of the present chapter
2o6 Principles and Methods in Commercial Education
is to discuss the subject-matter of accounting suitable for
high school purposes, and its method of presentation. We
shall first outline what we believe to be the proper content
of the course, and then treat of the methodology involved.
Balance sheets and various statements should be studied
intensively. The distinction between capital and income
should be emphasized. Single entry should be contrasted
with double entry, and the change from the first system to
the second should be assigned as an exercise. The changes
from single proprietorship to partnership and from both to
the corporate form of organization, together with the organi-
zation of new corporations, should occupy a large part of the
time apportioned to this course. The principles underlying
controlUng accounts should be thoroughly mastered. State-
ment of affairs and the simple proceedings connected with
bankruptcy should also receive attention. Cost accounting
should be treated in an elementary way, while the accounting
of executors and of social or other organizations should not
be ignored.
It is believed that what has just been so briefly outHned
should form the maximum limits of a course for high school
pupils. The understanding of the reason involved rather
than the ability to reproduce forms should be the criterion of
success in this work. Less work more intensely pursued and
more thoroughly mastered, rather than more work generally
treated, constitute a safe guiding motive.
Now how shall the subject-matter be presented so as to
realize the ideals we have set before ourselves? In order to
approach the methodology properly, it is well to consider two
points ; namely, the cahbre of our pupils and the aim of our
instruction. We realize that the student of accounting has
already had two years of bookkeeping, during which time he
Accounting 207
became familiar with the principle of double entry, with the
detailed operations involved in the organization, construction,
and dissolution of simple concerns, and with the drawing up
of business and financial statements. Unfortunately, the
very nature of the situation precludes the possibility of a
thorough grasp of all the work involved ; but, more happily,
it will be found that the student's attrition with the items
handled has left him a residuum upon which we may safely
rely and which we may confidently employ as a foundation
for the superstructure of accounting. The aim we have al-
ready developed at sufficient length, so we need only recapit-
ulate it in the briefest terms, — a desire to understand the
purpose of accounts, the interrelationship of accounts, and
the abihty to read and prepare the more ordinary business
statements. And as a final word regarding the aim of the
course, we must include a conscious desire on our part to in-
still a longing for further study to the end that our graduates
shall not content themselves with being mere cogs in the great
office machine of commerce and industry, but that they strive
to attain the higher possibilities involved in accountancy as
a profession.
METHODOLOGY
Just as it was found impossible to treat fully of all the details
in the course in any subject, so it is impractical to attempt a
complete compendium of method for all the topics included
in this subject. We have already suggested how to develop
the important difference between capital and income, and we
now leave the subject by indicating the conclusion resulting
from a failure so to differentiate. This conclusion differs
somewhat from the more general and more philosophical one
previously arrived at, but it is of more service for the purposes
of the high school pupil. Were we, for example, to charge
2o8 Principles and Methods in Commercial Education
the cost of each year's painting to the Building account or the
amount of each month's Horseshoeing or horse stabling to the
Horse and Wagon account, it is readily seen that the respective
assets would grow more valuable as the building grew more
dilapidated and old and as the horses became aged and feeble.
This form of attack is similar to the rcductio ad absurdum of
geometry, and may be developed by Socratic questioning.
BALANCE SHEET
The reader is now asked to consider the balance sheet.
Two important points are selected for present treatment.
One deals with the reason for calling the statement a balance
sheet, the other with the need of segregating the individual
items according to some general plan.
Select a trial balance for discussion. Assign as an exercise
the closing of the corresponding books. This had resulted in
the elimination of all the nominal (loss and gain) accounts,
the addition to or deduction from the capital accounts of the
net profit or net loss, and the addition of certain real accounts
(asset and liability inventory items) which were absent, or,
at least not present in exactly the same way, previously.
Now assign as an additional exercise the taking of a trial
balance, often styled a " proof balance " in the elementary
texts. If the work has been correctly performed, the last
list of balances will reveal a debit total exactly equal to the
credit total. A comparison between these balances and those
contained in the so-called " Statement of Assets and Li-
abilities," which should also have been prepared, will show
a one-to-one correspondence throughout. It should not be
difficult now to recognize the practical identity of the balance
sheet and the statement. The terminology, too, should now
be perfectly clear : the balance sheet contained all the
Accounting
209
balances, hence it is a " balance sheet." The trial balance is
a list of all the balances, after posting, but before the books
have been closed. The balance sheet is a Hst of all the
balances after closing the books.
Having established the rationale for the term, it is quite
seasonable to consider the arrangement of the items on the
balance sheet. A simple illustration may be made to suffice
for the establishment of the need of a system of segregation. ,
Assume that you had a choice of associating with either
concern A or concern B, whose capitals were equal to each
other, upon the investment of a like sum by you. Could you
choose logically between the two? Let us see. The correct
balance sheet of concern A follows :
ASSETS LIABILITIES AND CAPITAL
Cash $ 8,000.00 Notes and Accts. Pay. $16,000.00
Notes and Accts. Rec. 12,000.00 Capital 18,000.00
Mdse. on hand 4,000.00
Plant and Mchy. 10,000.00
$34,000.00
$.:;4.ooooo
The correct statement for concern B is as follows
ASSETS
Cash
Notes and Accts. Rec.
Mdse. on hand
Plant and Mchy.
LIABILITIES AND CAPITAL
$4,000.00 Notes and Accts. Pay. $16,000.00
5,000.00 Capital 18,000.00
2,000.00
23,000.00
$34,000.00
$34,000.00
Even a casual inspection will reveal the reason for a decided
preference in favor of the first concern, everything else being
equal. Should A be called upon to pay off its indebtedness,
it could easily do so, and have a comfortable balance left for
the conduct of its affairs. But matters are quite different
2IO Principles and Methods in Commercial Education
with the other concern. If it realized the full amount on all
its current assets, five thousand dollars of its liabilities would
remain unliquidated. The evident reason for B's desire to
secure additional funds is to meet an apparent deficit, while A
is financially able to continue without such aid. The dis-
cussion might be prolonged indefinitely, but the conclusion
for our present purpose is already manifest. A segregation
of items so as clearly to set off current assets against current
liabilities, and corresponding classes of assets against the cor-
responding liabilities, is an accounting desideratum.
The individual teacher may carry the indicated separation
as far as his judgment indicates it as desirable, and he may even
reverse the order about to be shown, but the point to be em-
phasized is the absolute need of a systematic classification.
A suggested form follows :
BALANCE SHEET OF
THE L.
M. COMPANY, AS OF
DECEMBER
31
» 1913
Current Assets :
Current Liabilities :
Cash $
Notes Payable $
Notes Receivable
Accounts Payable
$
Accts. Receivable
_ ^
Trade Assets :
Deferred Liabilities :
Finished Goods $
Accrued wages $
Goods in process
Accrued interest
Raw materials
_ ^
on mortgage
$
Deferred Assets :
Fixed Liabilities :
Prepaid taxes $
20 yr. mtge. bond
$
Prepaid insuranfce
_ «
Capital and Surplus :
Fixed Assets :
Plant and Mchy. $
Capital Stock $
Tools
Surplus
Fixtures
$
Reserve
$
Accounting 211
SINGLE ENTRY
The transition from double entry to single entry is a very
simple process. A statement to the effect that the latter
system keeps personal accounts only furnishes the cue to
the necessary treatment. Consider a given transaction. Do
the rules of double entry result in either a charge or a credit
to a personal account? If there does result such a debit or
credit, it is to be entered accordingly ; the rest of the solution
is ignored. The conclusion is soon arrived at that in order
to ascertain whether as a result of a given transaction there is
to be a single entry debit or credit can be determined by the
application of double entry devices and tests already known.
After learning the principle of debit and credit as employed
in the single entry system, the next question concerns itself
with the books employed. Under the simplest conditions
a journal, a ledger, and a memorandum cash book suffice.
Inasmuch as under such conditions all postings are made from
the journal only, a cash item must appear twice. With the
growth of business, other books, such as sales and purchase
books, are added ; these, together with the cash book, become
posting media, and we soon see that double entry differs from
single entry only in the ledger accounts kept. But a class
readily sees that by means of special columns in the books of
original entry, double entry involves so little extra work that
no argument remains in favor of the single entry system.
When the further difference between the two systems regard-
ing the determination of the condition and progress of the
business has been seen, the class will be ready for the discus-
sion involving the relative merits of the two systems.
The change from single entry to double entry is often
regarded as a difficult step. We beheve that the obstacles
212 Principles and Methods in Commercial Education
are more imaginary than real. Let the class have before it
two ledgers, — one the result of single entry bookkeeping,
the other of double entry. Elicit from them that the essential
difference lies in the absence from the former of the real and
nominal accounts contained in the latter. But how may the
first be made like the second? Simply enough, by adding the
real and the nominal accounts. After performing the nec-
essary operations, induce the class to express what they did
in somewhat the following way :
First make the last single entry entry, i.e., give the proprietor
credit for the net gain, or charge him with the net loss found.
Then, copy the Statement of Assets and Liabilities into the
journal, posting all those items which are not checked.
The full journal entry, in a hypothetical case, is herewith
shown :
V
V
i8
24
19
V
V
Dec. 31, 1913
John Doe Cr.
For year's net gain as per statement.
31
I have this day decided to change my books
from Single Entry to Double Entry. The
following exhibit shows the condition of my
business :
Cash
Accounts Receivable
Notes Receivable
Mdse.
Notes Payable
Accounts Payable
John Doe, Prop.
The above balances have been posted as
indicated, except those checked ; cash appears
in the Cash Book, Accts. Rec. and Accts. Pay.,
itemized, and John Doe, Prop.'s account, are
already in the ledger.
568
1896
4304
3300
2000
2400
1800
7300
Accounting 213
CONTROLLING ACCOUNTS
Just as the distinction between capital and income may be
said to illustrate the distinction between bookkeeping and
accounting on the theoretical side, so the use of controlling
accounts may be said to differentiate the two on the side of
technique. The introduction of these accounts has enabled
the accountant to apply various " internal checks " or '' fraud
preventives " without sacrificing time.
It is hardly necessary to suggest that the various practical
advantages of controlUng accounts should be grasped by the
entire class. No teaching of the subject is complete which
fails to emphasize the fact that these accounts were sum-
maries as well as proofs, and that they faciUtated the taking
of trial balances. But as our experience serves to show that
many pupils who know how to keep books which embody
these controlling features fail to understand the principle
involved, and as we believe in the principle that what one
thoroughly understands one need not memorize, we propose
to develop a lesson on controUing accounts for the benefit
of the student and teacher as well as for the sake of the busi-
ness man who wishes to obtain more Hght upon this subject.
For the purposes of this model lesson, let us select one of
the two common examples of controlling accounts. Accounts
Receivable, or Customers' Ledger Controlling Accounts as it
is sometimes called, will now serve our purposes. We already
know that the transactions which ordinarily affect a customer's
account consist of sales as charges and of credits arising as a
result of payment in cash or by note, or by a return of goods.
Hence the necessity of arranging our books so as to provide
for these various charges and discharges, both individually
and collectively.
214 Principles and Methods in Commercial Education
The sales book, or an equivalent, furnishes the medium for
the debits. Each charge to an individual's account in the
customer's ledger corresponds to a similar charge to the con-
trolling account in the general ledger, in virtue of the fact that
the charge to this latter account is the sum or total of the
items previously posted as single items to the customers'
ledger. And though the entries to the individual accounts
be made daily, the sum to the controlling account is not
usually made oftener than once a month. If the work has
been performed correctly thus far, it follows that the sum ob-
tained by Usting all the items found in the various accounts
of the customers' ledger — and they consist of charges only,
as yet — will exactly equal the single item in the Customers'
Ledger Controlling Account. The next comment in this
connection is that the controlling account, in the condition
assumed, represents the total amount owed to us on open-book
accounts, while the sum of all the items in all of the accounts
of the Customers' or Sales Ledger shows this outstanding
amount in detail. Inasmuch as only the posting to the Gen-
eral Ledger affects the Trial Balance, it is necessary to offset
the charge to Customers' Controlling Account by a credit for
an equal amount. This is accomplished by crediting the
Sales Account with the same total from the Sales Book.
But the case just reviewed is one-sided and hypothetical.
The total amount just considered is reduced by various credits,
and these it is our intention now to consider. Remedy :
These credits, as the reader knows, consist of cash received
by us, notes receivable, and goods returned to us. We shall
first present the result of cash receipts, and then the effects
of notes and returned sales. Before proceeding, however, it is
well to observe the condition of the books at this stage. Let
us assume that our books at the present moment are as follows :
Accounting
215
I18
18
27
%
Sales, Dec. i, 1913
T. Jones, 2/10, n/30
(itemized)
8
T. Jones, 2/10, n/30
(itemized)
15
R. Smith, on acct.
(itemized)
29
T. Williams, 2/10, n/30
(itemized)
31
Customers' Controlling a/c, Dr.,| total for
Sales, Cr., j month
500
00
750
00
600
00
310
00
2160
00
In the Customers' Ledger:
18
1913
T. JONES
Dec.
2/10, n/3oS
2/10, n/30
500
750
27
1913
R. SMITH
Dec.
15
On ajc S
600
^ Folios in Customers' Ledger. 2 Folios in General Ledger.
2i6 Principles and Methods in Commercial Education
1913
T. WILLIAMS
Dec.
29
2/10, n/30 S
310
In the General Ledger
1913
CUSTOMERS' CONTROLLING ACCOUNT
Dec. 31
S 8
2160
1913
SALES ACCOUNT
Dec.
31
2160
Accounting 217
Assume that we have to consider the following transactions :
(a) Dec. II, Jones paid invoice of the ist inst., by check,
$490.00.
(6) Dec. 17, Jones paid invoice of the 17th inst., by check,
$750.00.
(c) Dec. 16, Smith paid on account, check, $200.00.
Omitting " a " for the moment, we know that " b " would
ordinarily result in :
Cash $750.00
To Jones $750.00
but, inasmuch as we now have a controlUng account, it must
also be credited with $750.00 in order to reduce the amount
of Accounts Receivable. The problem, then, is how to ar-
range the cash book so as to furnish the one debit and the two
credits. The class will readily see that if a special column on
the debit side of the cash book is provided for all items affect-
ing customers' accounts, each account may be credited in-
dividually, and the controlUng account credited with the total
of all items in this special columm. This arrangement affords
a solution for " b " and " c."
An apparent difficulty confronts us in the case of " a."
Were we to journalize the transaction, it would be :
Cash $490.00
Discount on Sales 10.00
Jones (Customers' Controlling %) $500.00
The cash book arrangement previously described may be so
modified as to provide a convenient medium for recording
2i8 Principles and Methods in Commercial Education
the more complicated transactions of the type just shown.
An arrangement of columns, such as the following, is usual :
Customers'
Controlling
Accot™T
Dis. ON Sales
Net
The amount of the check is entered in the last column, the
amount in payment of which it was received is entered in the
first column, the amount allowed for prepayment in the second.
Where no discount has been allowed, the amount received is
entered in the first and third columns. Posting offers no
special difficulties, if one bears in mind that the ledger result,
regardless of the book or form employed for the recording of
a transaction, remains unchanged. It is easily seen that the
total of Discount on Sales should be posted to the debit of
its account in the general ledger ; that from the first column
the individual items are to be posted to the credit side of
their respective accounts in the Customers' Ledger, while the
total is credited to the Customers' ControlHng Account in
the General Ledger. The net cash, that is, the difference
between the first and the second .columns, is the amount of
cash debited, and this is found in the net column on the debit
side of the cash book.
Returns of goods from customers and settlements by note
remain for treatment in connection with controlling accounts.
These transactions require a modification of the ordinary
Accounting
219
journal so as to provide for crediting the customers' personal
accounts in the Sales Ledger, and at the same time to furnish
a convenient means of posting to the controlling account in
the General Ledger. The following form (omitting Accounts
Payable, at present) will help explain the use of this book :
Purchase
Ledger
Controlling
Account
General
Ledger
L.F.
Dates
Notes Rec. His 30 day note,
N. Smith on account
Sales Returned goods,
R. Jones damaged
R. Franklin Gave our 60-day
Notes Payable note on account
Billings & Co. Returned goods.
Purchases not as per order
Customers' Ledger Controlling %
Purchase Ledger Controlling %
General
Ledger
Customers'
Ledger
Controlling
Account
1000
250
00
00
500
25
1250
00
00
00
1000
250
525
00
00
00
500
25
CO
00
525
00
1250
00
1775
00
1775
00
The reader will readily see that if the suggestions embodied
in the foregoing treatment of the Customers' Controlling ac-
count be observed, a class of average intelligence should have
no difficulty in grasping the principles involved. In a similar
way, but with less detailed explanation, the Purchase or Cred-
itor's Ledger Controlling accoimt may be taught.
COST ACCOUNTS
A very important element in the recent advance made by
accounting is the fact that it has been appHed to the deter-
2 20 Principles and Methods in Commercial Education
mination of factory costs. Competitive forces have made it
essential for the producer to control the cost of output to the
end that leaks be detected and weak links in the production
chain be discovered. It is because of the importance of
accounting in connection with the shop that it is deemed ad-
visable to include the elements of this subject in such a general
course as the one here planned. But how much should be
included and how shall that portion be taught?
Quite obviously, cost accounting cannot be thoroughly
presented. It is sufficient that the class recognize the differ-
ence between a manufacturing, trading, and profit and loss
statement and cost accounts. The former is a sort of post
mortem exhibit, — it shows the result of a period's operations.
Cost Accounting attempts to keep a contemporaneous record
so that not only will final results be obtainable, but so that
also, at intermediate periods, the efi&ciency of the operations
may be determined.
As illustrations of what cost accounts can accomplish, two or
three well-known examples must suffice. In a certain factory
it was found by the accountants who were called in that there
was a great discrepancy between the weight of raw metal and
the weight of the corresponding castings. The accountants
pointed out that there was a leak somewhere, and the manage-
ment, acting upon their advice, found that many faulty cast-
ings, instead of being returned by the workmen, were thrown
away behind a fence, so as to avoid detection of the defective
work. In another case, the leather employed by a certain
department of a shoe factory was excessive in comparison
with that employed for similar purposes in other departments.
Surveillance disclosed that the men were throwing completed
heels at boys who were swimming in a stream below the fac-
tory windows because the lads used to tease the workmen.
Accounting
221
Further investigation showed that the boys sold the heels to
a rival factory in another part of the town. Cost records,
to mention just another instance, have shown that it was
profitable to drive a drill at a speed sufficient to destroy it in
a few minutes rather than to slow down in order to lengthen
the life of the tool.
Now, what are cost accounts ? In answering this question
we also dispose of the other, how to teach cost accounting in
the high school. When we learn that the essential elements
of the productive activity, from the accountant's point of
view, consist of the destruction of raw materials, the direct
cost of labor employed, and the other more general or overhead
charges, the problem before us is greatly simphfied. In order
to control the raw materials used, some form of stores record
is necessary. The forms employed provide for a recording
of the total amount purchased, the amount given out for any
particular job, and the balance on hand. Wages paid out
are so divided, whenever possible, as to charge each job or
contract with the amount incurred on its behalf. Other
costs, such as depreciation of the plant, the use of fuel and
Hght, and the other factory costs, are apportioned in accord-
ance with some predetermined plan. In the simplest form,
the completed cost account, showing the profit on a particular
contract, is as follows :
Contract No. i86
Date
Materials
Wages
Factory Overhead
Apportioned
Profit
$1800.00
2600.00
225.00
750-00
)375-oo
Date
Amount of Con-
tract
Extras
$5000.00
37S-00
$5375-00
222 Principles and Methods in Commercial Education
DEVISING A SET OF BOOKS
It is no easy task to devise a system of books, even for a
simple business. The student should be led to see that two
preliminary steps are essential : {a) the business must be
surveyed so as to determine the kind of transactions which
occur. The transactions will suggest the books to be em-
ployed, {b) Before the books are ordered, typical transac-
tions should be entered upon sample rulings, so as to test the
value of the proposed system.
Let us employ an ordinary trading concern for the sake of
illustration. Its operations consist of purchases and sales,
cash receipts and disbursements, and miscellaneous trans-
actions. A purchase book, or purchase journal as it is some-
times called, a sales book, a cash book, and a journal are nec-
essary. Now let us suppose that the principal purchases are
made from a dozen concerns, while the number of customers
is several hundred. This state of affairs necessitates a di-
vision of the ledger into a sales ledger and a general ledger,
the latter including the accounts with creditors. In the cash
book and in the journal special columns will have to be pro-
vided for the customers' controlUng account. Other special
columns will be needed in the books of original entry in order
to reduce the work of posting frequently recurring items.
When a set has been planned in accordance with the scheme
just briefly outlined, an essential test, already mentioned,
must be appHed. Take the transactions which are to be of
frequent occurrence and make sure that there actually has
been provided a means of easy and efficient recording. But
before approving the set, it is well to assure one's self that the
less usual transactions can also be handled. As a general
rule it will be found that the journal will be the medium
Accounting 223
whereby such transactions will find their way to the proper
accounts.
AUDITING
The work of the present chapter would lack completeness
were we to conclude without some reference to auditing.
Though it is no part of the high school scheme of education
to turn out finished auditors, it is nevertheless fit and proper
that those in our charge recognize the kind of work performed
by the auditor. Even if our students never expect to earn a
livelihood by practising as pubHc accountants, they may never-
theless be called upon to vouch the treasurer's report of an
organization or a society, and such a possibiHty, by the way,
may serve as a very interesting introduction to the subject,
from the teacher's point of view.
Auditing is essentially reviewing. It consists, at least so
far as the high school course is concerned, of going over the
work of the bookkeeper and certifying to its correctness. Nor
is this division of accounting absolutely new. In the mathe-
matics room, for instance, checking of operations and results
has been insisted upon. In bookkeeping, too, the postings
have been gone over as a precaution against error, and other
steps have been taken to assure correct results. An audit is
a systematic checking, and because it is systematic it requires
a plan. Thus, if cash receipts and disbursements are to be
audited, it is necessary to ascertain that all money received
has been actually deposited or otherwise accounted for, and
that all payments were bona fide and legitimate.
But instead of merely checking cash, it is usually necessary
to go over all the work. Hence the need of knowing what
work requires checking. This necessitates that a list be made
of the books and vouchers to be examined so that a definite
idea shall be obtained of the problems to be solved, and in
224 Principles and Methods in Commercial Education
order to avoid the possibility of neglecting to examine some
book or class of accounts. As a final exercise, have the student
audit a complete set of books which has been kept by a fellow-
student. Insist that the certificate cover the correctness of
the work both with respect to principle and to fraud. Have
it also include a balance sheet and a statement of operations
based upon the trial balance which has been prepared by the
bookkeeper. The more capable student might criticise the
system examined and make constructive recommendations
for an improved set.
SUMMARY
There is a real distinction between bookkeeping and ac-
counting, although it is not easy to indicate the line which
separates the two. Due to the fact that it is possible materi-
ally to decrease the time which must be spent in acquiring
a knowledge of bookkeeping, without in the sHghtest way
eliminating any of the good features of the best course in
bookkeeping, considerable time is now available for high school
work in elementary accounting.
The course in accounting should be somewhat intensive.
The principal topics which should be included are the follow-
ing : Balance sheets, income statements, single entry, the
change from single entry to double entry, controlling accounts,
partnership accounting, and corporation accounting. If time
permits, some attention should be given to cost accounts, re-
serves, statement of affairs, deficiency accounts, and auditing.
The methodology which is indicated is based upon the prin-
ciples presented in connection with the teaching of book-
keeping. As much of the work in accounting is an extension
of bookkeeping, less time should be spent upon the introduc-
tory steps. Induction, rather than deduction, however, should
be the more prevalent method of presentation.
Accounting 225
EXERCISES
GROUP ONE
1. Describe the functions of the accountant in modern industrial
society.
2. Justify the inclusion of accounting in the curriculum of the com-
mercial high school.
3. Outline the steps which should be taken in the presentation of a
lesson on the balance sheet. How would you "motivate" the topic?
4. Why should double entry be studied before single entry? Dis-
cuss fully.
5. Indicate the pedagogic steps involved in a lesson on controlling
accounts. Select accounts payable for illustration.
6. Should cost accounts be taught in the high school ? Discuss fully.
7. What factors would determine your selection of specific sets of
books for class work. Draw your illustrations from the conditions
which exist in your own community.
8. Show how the high school course in auditing may be made prac-
tical.
9. What preliminary steps should be taken before installing a system
of accounts ?
GROUP TWO
1. Assume that the university authorities had criticised the wisdom
of offering a high school course in accounting. Draw up a brief for pres-
entation to the school authorities : (a) showing the value of the course ;
(b) proving its practical value ; and (c) proving that it does not compete
with the work offered by the university.
2. How should the methodology of bookkeeping be modified to meet
the requirements of accounting? Answer so as to guide high school
teachers.
3. As the head of the commercial department of a high school, select
one hundred dollars' worth of books to form the nucleus of an accounting
library. Briefly indicate the principles of choice which you observed.
4. Describe a system of indexing, which woidd make available for easy
reference, books and articles on accounting.
Q
226 Principles and Methods in Commercial Education
BIBLIOGRAPHY
Cole, W. M., Accounts — Their Construction and Interpretation. Boston,
Houghton Mifflin Co., 1908.
Greend LINGER, L., Accountancy Problems with Solutions. New York
Accountancy Pub. Co., Vol. I, 1909, and Business Book Bureau,
Vol. II, 191 1.
Hatfield, H. R., Modern Accounting. New York, Appleton & Co.,
1909.
Journal of Accountancy. New York, Ronald Press Co., current.
Klein, J. J., Elements of Accounting. New York, Appleton & Co., 1913.
Lisle, G., Account-Keeping in Principle and Practice. London, Green &
Sons, 1911.
Montgomery, R. H., Auditing Theory and Practice. New York, Ronald
Press Co., 191 2.
Nicholson, J. L., Cost Accounting, Theory and Practice. New York,
Ronald Press Co., 191 3.
Renn, G. B., Practical Auditing. Chicago, G. B. Renn, 1907.
RowE, H. M., Bookkeeping and Accounting. Baltimore, H. M. Rowe
Co., 1911.
Wolff, A. H., History of Accountants and Accountancy. London, Green
& Co., 1912.
Note. Pool's Manual of Railways, Manual of Industrials, and Manual
of Public Utilities furnish useful data for practice in the analysis of
annual reports of corporations.
CHAPTER VIII
Commercial Geography
its place in the curriculum
Tms term, in its larger sense, includes, as we have seen, a
study of the way in which man, by his industry, has subordi-
nated the forces of nature to his use. It.includes, therefore, a
study of the natural resources of the earth and a study of how
man, by his labors, has utilized these resources to his own ad-
vantage and to the advantage of his fellow-men. The study is,
or ought to be, the most cultural subject in the commercial
curriculum, because it gives the student an insight into the
nature of all those activities which give rise to man's industry
in relation to the material world. In this sense, therefore, it
is the broadest of all the subjects of the curriculum.
Unfortunately, there is no subject of the course which has
been taught more poorly than commercial geography. This
has been due partly to a misconception of the aim and content
of the subject, partly to the difficulties of handling the mass
of material, and partly to the lack of culture of those who have
taught the subject.
The greatest difl&culty has been due to the fact that infor-
mation has been made the end of the study, rather than or-
ganization, interpretation, and the relation of the subject to
the real activities of business. The mass of material included
in commercial geography cannot be absorbed by mere mem-
orizing. A good many facts can be memorized, of course,
but there is no assurance that these facts will remain in the
227
228 Principles and Methods in Commercial Education
mind ; and even if they did, it is a question whether in them-
selves they arc of much value. Facts are of very little value
unless they are interpreted and organized, and the results
applied to the understanding of business in its larger aspects.
Of what advantage, for example, is it for a student to know
the value of the foreign commerce of the United States in any
one year, as a fact for itself? This knowledge becomes of
value only when it is related to other facts of the same kind ;
as, for example, the commerce of the United States in other
years, the comparison of such commerce with that of other
countries, etc. ; and after such comparison is made, the ques-
tion should be asked : Is the country improving or is it going
back ? Is its rate of progress as large as that of other leading
countries, or not? After we have ascertained the fact, we
should then find the reason for it, and such inquiry will lead
us to discover the line along which the country has been
strong, the line along which it needs improvement, and what
are the factors necessary for such improvement. It will be
seen, therefore, that the handling of facts requires a selection
and an organization to bring out their meaning. A specific
illustration of how facts should be organized will be shown
below.
A second difficulty in the teaching of commercial geography
is due to a lack of facility on the part of the student for ob-
taining first-hand information. Facts are taken from books,
and no opportunity is given to the student to realize how facts
are gathered. In the very nature of the case, it cannot be
expected that the students will be able to gather the great
mass of statistical material by their own efforts. Millions of
dollars are spent every year by the United States government
and by private agencies to collect statistics. Upon the data
furnished by these public and private agencies the student
Commercial Geography 229
will, in the main, rely. At the same time every one should be
taught to realize the meaning of lirst-hand information.
Only in this way will he come to a real appreciation of the
meaning of statistics, and the way in which they aid a person
in the interpretation of commerce. There are sufficient op-
portunities for such first-hand observation in the immediate
environment of the student. Consequently, every course in
commercial geography should be introduced by a course in
local geography.
INTRODUCTORY COURSE IN LOCAL INDUSTRIES
The purpose of such a course in local commercial geography
will be threefold. First, to acquaint a student at first hand
with the meaning of the fundamental concepts used — such
concepts as transportation, raw material, manufactures,
market ; secondly, to make him acquainted with some of the
methods used in gathering facts, by giving him a first-hand
opportunity to gather some of the facts himself ; and thirdly,
to give him some background of experience, on the basis of
which he can interpret the facts and figures in connection
with places, countries, and activities, with which he cannot, in
the nature of the case, come in direct contact.
The opportunities for first-hand study of local geography
vary, of course, in different sections of the country. Persons
living in rural communities have fewer opportunities to make
a study of commerce than those living in the city. Further-
more, those students living in seaport cities have a still
larger chance for first-hand observation. Nevertheless, no
section of the country is so devoid of industry that it does
not offer some opportunity for a kind of laboratory or observa-
tional study of commerce. The initial step in such a study will
be the assignment of different problems to the students, to
230 Principles and Methods in Commercial Education
give them an idea of the fact that industry is going on before
their eyes, and to make them reaUze that fact. For example :
A student Uving in a city might be asked to take a census of a
particular block, and find out the kind of commercial indus-
tries that are conducted there. Another student might be
asked to follow a product through the various stages in its
transportation. Thus, it is possible, for example, for a stu-
dent to watch the processes by which goods are brought to a
store and unloaded ; or how certain goods are packed for
shipment, and how they are brought to the railroad station
or to the wharf. Another student might have the oppor-
tunity to watch a product through its different stages of manu-
facture and note how the raw material is transformed into a
manufactured product. These are common-place examples,
of course, and they may seem to deal with facts with which
every person should be acquainted. At the same time, it is
surprising to find the great amount of ignorance there exists
on the part of students in connection with such matters.
Teachers who take a knowledge of these facts on the part of
the student for granted, make a serious error, which is found
reflected afterwards, when they try to teach commercial
geography by means of a text-book, from which the students
memorize a mass of unrelated facts and figures. Besides, the
opportunity to gather facts at first hand is interesting to the
student, brings him in direct touch with commercial activities,
and trains him how to observe with his own eyes instead of
with the eyes of the teacher or writer of the text-book.
The same reasons, then, which prompt us to begin the regu-
lar course in geography in the elementary school, with a study
of the immediate locality in which the pupil lives, applies
even more strongly to the study of commercial geography.
The best teachers of elementary geography have recognized the
Commercial Geography 231
fact that the common notions can be made complete only by a
first-hand observation by the pupil; and local geography
alone gives an opportunity for observation within the grasp
of the immature mind. A first-hand observation of a river,
an island, a mountain, etc., will give the pupil at least a crude
knowledge of these terms. But the preHminary course in
local geography will have a larger aim than merely the visual-
ization of facts, because the concepts of this subject are less
static and more functional. A factory building or a store
will in itself give the pupil no idea of industry and com-
merce. It is these same places as centres of activity that
reveal some of the dynamic processes of industrial growth.
Facts about commerce contained in books are dead, unless
they are interpreted by a mass of experience which endows
these facts with vitaHty by showing them to be factors in a
process. The foundation for such organized experience must
be laid in the course in local industrial geography. Facts
and laws pertaining to the entire country, or even to a section
of it, do not have a concrete basis which lends itself to visual-
ization, and from which generalizations can be drawn. A
student cannot see the mining industry of the country, but
he can see a particular mine, the concrete observation of
which may typify the industrial laws pertaining to the min-
ing industry in the whole country. When, later on, he studies
about the mining industry, as a whole, a first-hand knowledge
of the local industry serves to throw light upon phases of the
study, which, otherwise, would remain abstract.
Furthermore, we have decided that the power to interpret
industrial facts is the most important result of the study of
commercial geography. This power is not merely of disci-
plinary value in strengthening the pupil's judgment, but it is
of direct, practical bearing. It enables him to understand the
232 Principles and Methods in Commercial Education
essential nature of business facts by referring them to the
forces which produced them. This knowledge helps him to
guide his course in the future by showing him how to deduce
possible effects from given causes or conditions. To under-
stand principles, he must discover them for himself by gen-
eralizing from the concrete manifestations of these principles.
These manifestations the inexperienced mind can grasp
only when they are displayed within the narrow circle of
his immediate environment. In the study of local industry
and commerce, he will find sufficient material for induction
and for illustration of principles. So important has this pre-
liminary course in local geography appeared to some teachers
that they have made it a very comprehensive course which
includes the greater part of the field ordinarily covered by
commercial geography. While there are strong reasons for
such an elaborate course, the difficulties are that it has to be
presented to minds that are not mature enough, and that
most localities fail to furnish that complete illustration of the
working of the principles of commerce as we find them in
large industrial centres Hke New York. An outhne of a
course in local commercial geography will be found in the
appendix to this chapter.
There is no lack of concrete material for the study of com-
mercial geography. Teachers overlook the abundance of
material which they might make use of, and rely upon the
text-book, because it follows the line of least resistance. The
text-book is an invaluable aid in commercial geography, and
its proper use will be discussed a Httle more in detail, but after
all, books, and particularly the text-book, should be used in
a supplementary, and not in an exclusive way. The concrete
material lies before every student, if he will only be taught
how to make use of it.
Commercial Geography 233
In connection with the discussion of aids in commercial
geography, we shall discuss the subject of the commercial
museum, observation trips, and pictures.
TOPICS TO BE INCLUDED
(i) Materials of Commerce. — This topic deals with the
materials — vegetable, animal, and mineral — which enter
into commerce. An intelligent knowledge of the materials pre-
supposes a knowledge of their source, their distribution, the
extent to which they add to the wealth of man, and the way
in which man transforms them so as to make them objects
of greatest utility.
(2) Physiographic Conditions which influence Commerce. —
In a certain sense, we might sum up the entire subject of
commercial geography by saying that there are two elements
involved, — nature and man. The study of nature in this
connection involves a study of the earth as nature offers it to
us (and this we note largely under the term of Materials of
Commerce), and the physiographic conditions which make
commerce possible. Under these we include the influence of
climate, soil, wind, and natural means of transportation.
This element is by no means an unimportant one. To get
the greatest value from the study of the physical or physio-
graphic conditions which influence commerce we must see
how man moulds and modifies these conditions in order to
make them of greatest use to himself. We may note, for
example, that weather conditions have a good or a bad in-
fluence upon a crop. But if we study this element from the
standpoint of man's adaptation to the weather conditions, we
obtain a much better insight into the relation of man to his
environment. Thus, the government issues weather reports
and predictions which may foretell possible disaster. Yet,
234 Principles and Methods in Commercial Education
the very knowledge of danger acts as a warning and leads us
to adjust ourselves to our expected conditions. We have a
season in which the earth is utterly unproductive, — the winter
season. But man's anticipation of the nature of this season
leads him to adjust himself to the expected condition by mak-
ing due preparation in time of productiveness. The study of
physical geography is both fascinating and useful when it is
taken up from the point of view of man's reaction and adjust-
ment to these conditions. While the geologist may study the
physical earth with a purely scientific interest, the student of
commerce should regard it entirely from the standpoint of
its relation to man's activities.
The motive of the student of commerce in studying such
factors as soil, cUmate, etc., is not the same, then, as in the
scientific study of physiography. No fact is considered
unless it has some bearing on the progress of commerce on the
earth, and no fact is studied unless that connection is actually
brought out. The proper study of physiography has the ad-
vantage of throwing light upon the manner in which the study
of commercial geography can become most fruitful. The
old study of physical geography consisted of an account of
the structure of the earth's surface. The new physical geog-
raphy puts the emphasis upon the forces which brought the
changes upon the earth's surface. Just so, our study of com-
mercial geography should deal with forces operating to pro-
duce changes, rather than mere dead facts. This leads us to
note that there are other forces which give rise to the facts of
commerce besides those of nature : the activities initiated by
man himself in moulding the environment for his own pur-
poses. We must therefore note :
(3) The Human Factors influencing Commerce. — These
include labor, transportation, money and banking, laws,
Commercial Geography 235
weights and measures, and government agencies. Among
these factors, the element of transportation is usually included
in the ordinary school course, because it is so closely con-
nected with geography proper, in view of the fact that the
large distances which separate people from the source of pro-
duction and the source of manufacture necessitate agencies
for transportation. But there are a number of other ele-
ments which are not strictly geographic in nature and which
are of the highest importance in facilitating the exchange of
products on earth. Some of these factors, like money and
banking, are generally included in the course on Economics.
It may be wise to defer the consideration of other human fac-
tors to another course, which we shall call the Technique of
Commerce, and which we shall treat in a separate chapter.
However, the government agencies influencing commerce
are of such an important nature and so generally overlooked,
that we take this occasion to refer at some length to the reasons
for giving extended consideration to this topic.
The facts connected with government activity in promoting
commerce and industry are not generally found in the or-
dinary text-book, but the government reports, and condensa-
tions of these reports as found in the almanacs, are of great
value in giving students an insight into the positive or busi-
ness side of the government contributions to commerce. The
indirect aid which the government gives to commerce is, of
course, well understood. If it did not give protection to its
citizens in the carrying on of their lawful pursuits, commerce
would be impossible. We see how commerce is crippled when
the stability of the government is threatened or when a stable
government is lacking. The relation of the government to
the making of laws to protect citizens at home and abroad,
and establishing uniform systems of weights, measures, and
236 Principles and Methods in Commercial Education
coinage, — these are all well understood. But still, the in-
fluence of these factors upon commerce should be discussed,
because the appreciation of the value of this factor is height-
ened by such discussion, and the student will get a much better
idea of the worth of his government. The direct aid of the
government to commerce, however, is generally overlooked.
Thus, the State Department, through the consular system in
cooperation with the Department of Commerce, is a most
valuable agency of the United States government in furnishing
to American merchants an account of the state of commerce
in foreign countries, and of the trade opportunities that are
offered to merchants in various parts of the world. The De-
partment of Agriculture is aiding, in a most direct way, the
agriculture of the country by helping to increase the produc-
tiveness of the soil by the elimination of waste through the
prevention of plant and animal diseases, by its protection of
the nation's food supply, and in numerous other ways. It is
necessary for students to know about these activities, not
merely because thereby they learn more about their govern-
ment, but because thereby they also learn how to avail them-
selves of the faciHties which the government affords them.
The work of the Departments of Commerce and Labor, in-
cluding such bureaus as the Immigration Bureau, Bureau of
Corporations, and the Bureau of Foreign and Domestic Com-
merce, is also of the highest importance. Here, again, the
discussion of the work of the departments leads to the con-
sideration of many large problems of vital interest to the
citizen. Thus, the discussion of the Immigration Bureau
naturally leads to the problem of immigration, the labor
problem in the United States, and various related topics.
Here we must again emphasize the fact that information
as such is of httle value if it does not lead to a discussion
Commercial Geography 237
and to a better insight as to the value of such information.
If the objection is made that such information is not readily
available, the answer is that if the teacher is looking for
a text-book in which all these data are compiled, he will be
disappointed. We shall note below how the teacher can
gather data for the study of these apparently inaccessible
topics, and how readily he can make them accessible.
(4) General Geography to be Included. — The study of com-
mercial geography should also include, of course, a considera-
tion of what might be called geography in the old sense, — the
study of the different countries of the earth, their important
industries, their large trade centres, etc. But in studying
these other countries, we must make a judicious selection.
Book knowledge, for its own sake, must be shunned. What
principles shall we follow in selecting our topics? First, of
course, we must understand the geography of the United
States. But even here we can emphasize certain facts and
suppress others. We are all aware how the old geography
regarded it a matter of the highest importance for a pupil to
know the capitals of all the different states of the Union.
The standpoint of commercial geography is entirely different.
Thus, taking New York State as an example : even though
Albany is the capital of the state, we regard Buffalo or Roches-
ter as more important cities. In many states the capital is
a very unimportant place, and the knowledge of it is of no
importance. If we were training post-ofl&ce clerks, we would
make it a specialty to teach them the location of as many
places in the United States as possible. But as no fact is
considered important that does not enter into relation with us
in an industrial, commercial, or social way, we have to select
our facts upon that basis. In considering the geography of
the United States by sections, it may be well not to take the
238 Principles and Methods in Commercial Education
state as the unit, but rather the section. Thus, for example,
New England would be a unit of study, not the individual
state. From the standpoint of commerce, state Hnes may
frequently be neglected. Commercially, Jersey City and
Hoboken are part of New York City, although politically
they belong to another state.
Next to the study of the United States and of the state in
which the student lives, the study of England, Germany, and
France looms up in importance. These are the three great
European countries with which our trade relations are most
important. Consequently, it will be necessary for us to note
the geography of these countries, but principally with refer-
ence to our trade relations with them. The detailed internal
geography of these countries is not important, except to the
extent to which it explains the progress of certain industries
in those countries. For example, it may be important to
explain certain factors which have contributed to the su-
premacy of England in the field of cotton manufactures.
This consideration might lead us to discussion of natural
conditions in England. As a general rule, however, unless
the fact enters into our commercial Hfe in some way, or unless
it explains a certain phase in the mastery by man of his en-
vironment, it may be neglected. One fault that must be
avoided is the learning of mere lists of exports and imports of
the country. This is the merest kind of book-learning or
fact-lore, that leads to nothing. We must repeat again the
injunction that no facts are to be taught unless they have
some significance in relation to our own activity.
The other European countries that may be included are
Italy, Russia, and Austria-Hungary. The reason for such
inclusion is the fact that these countries furnish a large body
of immigrants, and the understanding of economic conditions
Commercial Geography 239
in those countries gives us a better insight into the labor prob-
lem in the United States, and helps to explain our trade re-
lations with those countries. If the objection is made that
we are leaving the student in ignorance of important countries
like Sweden or Greece or Spain, the answer is that we are
compelled to make a selection. It is better to have an in-
tensive knowledge of a few facts than a superficial knowledge
of a great many. The most valuable substitute we could
give to the student for the large mass of facts is the ability
to find the facts for himself when he needs them, — the ability
to use reference books. How the student can be trained in
this direction will be discussed in connection with aids in
commercial geography.
For obvious reasons, our American neighbors, Canada and
Mexico, must not be overlooked in our study. As for the
South American countries, we may take Brazil, because of
the tremendous importance of its two crops, coffee and rubber ;
Argentina, because of its beef ; and ChiH, because of its nitre
and its general commercial progressiveness. Asia would
be represented in our course by Japan, China, and India.
Our trade relations with the Orient are of the utmost impor-
tance, not because of their present status, but because of the
unbounded possibilities which the Panama Canal to a large
extent will help to realize. These countries, with their very
large population, are only beginning now to demand those
luxuries of the western world which in our world have come
to be considered necessities. Their increasing demand will
lead to increased trade with the United States, their nearest
neighbor. The trade opportunities for American merchants
will therefore become multipHed many-fold within the next
few years, and the student should therefore come to a realiza-
tion of these opportunities. One of the things which a student
240 Principles and Methods in Commercial Education
in commercial geography should cultivate is the imagina-
tion. This is cultivated not only by a view of the present
conditions as they are pictured by the mind, but by the pos-
sible future conditions which we may expect. The man of
imagination, we may say paradoxically, is the best business
man, because he adjusts his activities not only to present
needs, but also to the larger needs of the future.
Our trade with the West Indies, of course, will have to re-
ceive due consideration, although the particular geography
of the several West India Islands and the various capitals
may not be of such great importance. There are at least
three staples of commerce that figure in the West India trade :
tobacco, sugar, and fruit. Again we must mention that a
study of these products can be best accomphshed not by merely
reciting their names or by telHng what countries they come
from, but by relating them to some agency or activity which
influences them. Thus, the West India fruit trade is largely
in the hands of the United Fruit Company. The study of
the activity of the United Fruit Company is a much better
means of organizing the subject of the fruit trade in the West
Indies than a consideration of the geography of the different
places from which the fruit comes. Our trade relations with
the Philippines will, of course, receive due attention, because
the Philippine Islands are a possession of the United States.
Australia and New Zealand are not so important to us now,
but they may become much more important on account of
the Panama Canal. In that case, Australian products will
have to receive proper attention. The continent of Africa
is of the least importance, commercially. There are a few
factors connected with it, that may be of value, such as the
gold and diamond supply of British South Africa. But the
geographic facts may be noticed as an incident to other topics
Commercial Geography 241
studied. Thus when the question of a coast line is considered,
Africa may be used as an illustration of how an unindented
coast Une results in few harbors, and therefore, in little com-
merce. The Congo region is another illustration of a topic
noted incidentally in connection with the study of the rubber
supply of Brazil.
SELECTION OF MATERIAL
Illustrated by the Topic of Materials of Commerce. — We
saw the difhculty of the study of commercial geography due
to the large mass of facts, and we stated that it was absolutely
necessary to make a selection. The principle of selection we
also stated to be this : Facts selected were to have some re-
lation to the possible industrial activity of the individual
student. We found, therefore, that we would have to reject
such topics as the detailed studv of Africa, the study of cer-
tain countries of Europe, etc. We also found that we had to
make a selection of a few of the products among all the ma-
terials of commerce. We may illustrate from materials of
commerce such a selection of facts and the principles to be
followed in such selection.
(a) Select those which are most important to the United
States, because of their magnitude. Corn is an illustration of
such a product. We must study it not only because it is by
far the greatest single crop of the United States and the most
valuable single product, but because the meat supply of the
country depends upon this crop.
{h) Select those which are illustrative of important phases of
industry. We select iron and steel on this principle, because
the industry involves a number of stages of manufacturing,
and it enters into the industrial activity of the United States
to a greater extent, perhaps, than any other single industry.
242 Principles and Methods in Commercial Education
(c) Select those which enter largely into international
trade. On this principle we select cotton, because it is the
greatest single export product of the United States. This
product helps to create the favorable balance of trade, and
thus makes the United States a creditor nation.
{d) Select those which illustrate utilization of by-products.
Petroleum is a good illustration of such a material. The
by-products in the refinement of crude petroleum to-day are
much more valuable than the kerosene, which at one time
was considered the only useful product of the refinement.
The importance of the utilization of by-products lies in the fact
that not only is the total wealth of the country increased in
that way, but the main product is reduced in price, because of
the elimination of waste. The cattle products and the pack-
ing industry may also be considered as an excellent illustration
of the utilization of by-products. The familiar saying that
" everything of the pig is utilized except the squeal," illustrates
this fact.
(e) Select those which are indispensable to the great indus-
tries of the United States. Thus copper might also be con-
sidered, because of its great importance in the electrical
industry and because the United States is the greatest pro-
ducer of this product.
(/) Select the most important food product in the coun-
try. In the greater part of the civiHzed world it is wheat.
Naturally, there is nothing more important than the food
supply of a country, but in addition, wheat should be con-
sidered in relation to its effect on the railroad business of the
country. The annual shipment in the fall of the harvested
wheat to the Atlantic Coast is one of the greatest sources of
revenue for the railroads. If the shipments of wheat are large,
the business of the railroad is large, the business of the steel
Commercial Geography 243
mills is large, because the railroads are their greatest cus-
tomers, and other industries are correspondingly benefited,
owing to the increased buying capacity of the workers. Thus
we see that the consideration of the relation of the wheat crop
leads us to a study of the relation of the size of the crop of the
country to its wealth as a whole.
(g) There is one product, gold, which should be considered
for a special reason of its own. It ought to be studied be-
cause of its importance as a medium of exchange, and the
relation of the gold supply to high prices. There may be a
number of products which we may have omitted from the
list, such as tobacco, sugar, coffee, etc., but these products
time does not allow us to treat independently. We may con-
sider them in relation to the country in which they play an
important part. Thus, coffee should be treated in some detail
when we come to study the geography of Brazil.
ORGANIZATION OF MATERIAL
How shall we organize the facts selected, as, for example, the
materials of commerce noted above, so as to hold them in mind,
so as to give them significance, and so as to relate them with
the other facts in our possession in a complete system. We
may state the following principles of organization :
(a) A knowledge of facts without interpretation is of little
value. By interpretation, we mean the discovery of the
causal relation of the facts, the explanation of the fact by
showing its relation to a cause, and by tracing the effect of
this fact upon other facts.
(b) Hence, pupils should not be asked to memorize facts
which have no significance. This point has been stated be-
fore. The more significant the associations gathered around
a fact, the more likely is it to remain in mind.
244 Principles and Methods in Commercial Education
{c) How shall we organize our knowledge of figures ? Com-
mercial geography deals with statistics and many of the
figures are of importance and should be remembered, but in
this connection we must remember that abstract figures are
of little significance. By this we imply that there is no
meaning revealed to the ordinary mind by the mere fact that
the total quantity of steel produced by the United States is
over 26 million tons. The mind does not grasp the impor-
tance of this fact. But when we compare this quantity with
that produced by Germany, — 13 million tons, — we begin
to draw inferences, and note that the United States pro-
duces twice as much steel as our nearest competitor. Relative
figures are therefore much more important than absolute
figures, and graphic methods are the best means of organizing
statistical facts by bringing out the quantitative relationship
between the figures. In connection with aids in commercial
geography, we shall discuss a Kttle more fully the importance
of graphs in commercial geography.
{d) Another method of organization is to follow a certain
factor through its various stages, to view it through its various
transformations, and trace its progress from its origin to its
destination. There is nothing that adds so much to the in-
terest of the study, there is nothing that helps so much to
transform the study from a static to a dynamic one, and there
is nothing that helps to focus the attention upon function rather
than facts, as does this procedure. Thus, we may follow iron,
starting with the mining of the ore and its transportation to
the blast furnaces, considering its transformation into pig
iron, its manufacture into steel bars, the rolling of these bars
into rails, and the laying of these rails upon our railroad tracks.
In this way, we not only attain an organized view of the value
of iron as a product, but we note the human agencies which are
Commercial Geography 245
necessary to transform the iron so as to make it most useful
to man, and we note all the organized effort which this necessi-
tates in the way of transportation, manufacture, etc. The
net result is to give us a view of iron not as a thing, but as a
promoter of industry and a satisfier of needs.
(e) In all our organization of facts, we must dwell upon the
importance of causal relationship. In order to show that a
certain factor is a cause, we use a method which we may con-
sider the method of hypothesis. We see a certain condition,
such as the development of a great cotton industry in New
England, and we are not satisfied with the mere fact of saying
that there is a great industry in that section, but we inquire
as to the cause of such development. In order to find an
explanation for this phenomenon, we consider the general
factors which promote an industry, and we assume that New
England must have these conditions. We look around and
find its great water power, its great supply of labor, its near-
ness to the market, and its early start in the industry ; and we
find that these factors explain the greatness of the industry.
We therefore call them causes. On the other hand, we see
that the cotton industry in the South is not as great as we
might expect. We look at the conditions, and we find the
absence of rehable labor, and this explains why, in spite of
other natural conditions, the South cannot compete with New
England in the manufacture of cotton. This shows us
another way in which we arrive at causal relationship, — a
very striking way. The writers on logic call it the Method of
Difference. For example, the country is prosperous, and we
should expect its prosperity to continue. All of a sudden,
we find the wheels of industry are stopped. What has hap-
pened? A certain condition has been changed. A money
stringency has arisen, the banks have called in their loans, and
246 Principles and Methods in Commercial Education
manufacturers have consequently been compelled to close
their shops. The change in prosperity is therefore attributed
to the change in this condition, other factors remaining the
same. The method of difference should be continually used
in order to explain a given situation. What is lacking in
Mexico, we ask? With all its natural resources, we see the
difference between Mexico and the United States. The answer
is, lack of something which the latter possesses, — stable gov-
ernment and education.
AIDS IN COMMERCIAL GEOGRAPHY
I. The Text-hook. — This is the only aid with which some
teachers are familiar. Of course, it has some uses, {a) As
a source of reference for facts. In the assignment of lessons
in the text-book, the teacher need not necessarily follow the
order of topics in the book. He may, and should, assign by
topics, and let the student, by use of the table of contents and
the index, find the treatment of the topic assigned, {h) As a
means of keeping the class together. Whatever the values of
individual assignment of problems may be, it nevertheless
remains a fact that there should be a common basis upon which
the pupils should build their knowledge. The text-book, in a
sense, represents the medium which unifies the work of the
different pupils, and furnishes the organized review of the
subject, (c) While the ordinary text-book method by which
the teacher assigns his lessons and hears recitations is grossly
inadequate, at the same time the text-book as a means of
review is of great importance, and may be read with great
interest by a person who has had an intelligent background
of experience, which the text supplements, {d) The text-book
is an aid in the organization of facts, because it gives to the
student types of organization. It makes comparisons, looks
Commercial Geography 247
for causal relations, and finds them, (e) By means of sug-
gestive causes and problems, it stimulates the pupil to investi-
gation and research.
The limitation of the text-book, we have noted incidentally.
{a) It cannot bring the facts up to date, because facts change
and statistics are different from year to year. The pupil
must therefore bring facts up to date by means of reference
books, ih) The text-book gives the facts and generally gives
the explanation of causes. It therefore checks self-activity.
It is true that the student will have to exercise his mind in
order to think over the explanations of the text-book, but, in
general, he may simply take them as dead facts and memorize
them. This is the main difficulty of the text-book recitation
method. For that reason, the progressive teacher will use the
text-book only as an aid in providing material, and make use,
to a large extent, of other aids.
2. Reference Books. — Among the reference books are al-
manacs, encyclopaedias, and government reports. The alma-
nacs are mines of information on many topics, — information
that is available when it is needed. The mistake that many
text-book writers make is to cram their books with information,
so as to make it relatively complete and take the place of the
reference books in that way. The pupil therefore imagines
that these facts are to be crammed. Many facts need not
even be remembered, but the student should be taught how to
find them whenever they are needed. One of the most impor-
tant abilities that the teacher can cultivate in the pupils is the
power to use reference books, because in that way he gives
them the power to help themselves by finding their own infor-
mation when the teacher is not there to give it to them. We
see how helpless many people are in the matter of finding
information on a number of simple topics, because they have
248 Principles and Methods in Commercial Educalio
never been taught how to find the information for themselves.
The student must be taught how to use a table of contents and
index. He must be taught how to use a catalogue, how to con-
sult a bibliography, how to find magazine articles on the
particular subject on which he is working, how to find the
information he is looking for in the almanac, the encyclo-
paedia, or the government report. (A list of important refer-
ences and government publications will be found in the appen-
dix to this chapter.)
But in the assignment of topics to students for research,
we must avoid certain mistakes. One of them is, to confine
the benefits derived from the topic for research to the partic-
ular student who is undertaking it. This is a common fault
of the seminar method as it is extensively used in colleges and
universities. The other students should not only have a
general knowledge of the topic on which the particular
student has specialized, but such knowledge should be im-
pressed by discussion in the class upon the report of the
student who has made a special investigation, and by holding
the other students responsible for a general knowledge of the
conclusions reached by the student who has made a special
investigation. Another fault which might be found in the
secondary schools is that students will present discussions and
reports which they themselves do not understand, because
they have copied the conclusions of others as they found them.
Questioning on the part of the teacher will avoid this difficulty.
Another difficulty might be that students will become pedantic
or desire to make a display of their diligence. This is not
really a serious difficulty, and is a matter the handhng of
which will depend upon the tact of the teacher.
We may note some suggestions on how the ability to use
reference books can be acquired. The basis for this ability
Commercial Geography 249
is the knowledge of how to use an index or a catalogue,
and an acquaintance with popular reference books like the
World Almanac or the Encyclopaedia. Skill in the use of
reference books can be developed only by practice, and the
following are some of the ways in which opportunities for
practice can be given :
(a) Lessons should be assigned by topics, instead of by
pages, so as to compel the student to resort to the index.
(b) Assignments should be made which are not fully
covered by the text-book, and will compel the student to go
to the library in order to obtain the information in some
other text-book or in reference books.
(c) Statistical facts and figures should frequently be looked
up by the students themselves, and not handed to them. For
this purpose a large number of convenient reference books,
like the World Almanac, should be in the hands of the class.
If possible, every student should have a copy of his own.
(d) A number of convenient statistical reference books,
such as BulHnger's Monitor Guides, Lloyds' publications, and
certain United States government bulletins should be found in
the commercial library of the school, so as to facilitate
research.
(e) Special lessons on the use of reference books should be
given in the class, and the students given a knowledge of
what the various sources of information are, and practical
drill, under the direction of the teacher, on how to find a
certain piece of information.
(/) Certain questions of fact, such as are frequently foimd
in the inquiry column of a newspaper, may be proposed to
different members of the class, who may be required to find
the answer in the reference book. At first the possible hnes
of research to discover the fact may be discussed in the class,
250 Principles and Methods in Commercial Education
but later on the question should be assigned without any
clue to the student. To insure honest work in this con-
nection, no two students should receive the same questions.
3. Observation Trips. — We found that one of the necessities
in commercial geography is a proper background of first-
hand information on the basis of which the student can gen-
eralize. This is to be supplied by the observation trips.
Such trips to business houses and industrial plants are well
known. Unfortunately, they have frequently failed of their
true purpose, because they have been looked upon as mere
holidays, and because the teacher has not definitely kept in
mind the purpose of the trip. The following principles to
be observed will suggest the way in which these trips can be
made of the highest educational importance.
{a) There should be a definiteness of aim. If the pupils
are going to a particular plant, the teacher should know why
he has selected that plant and what he is aiming to accompHsh
by the particular visit. This aim should be not only in the
teacher's mind, but in the pupil's as well.
{h) Most of the difficulties in the observation trips arise from
the fact that the student's attention is too scattered by the
novelty of the situation to enable him to observe the things
which the teacher wants him to observe. This trouble can
be obviated by suggestive questions given out by the teacher
in advance of the trip, to be answered by the pupil's indi-
vidual observation. The student will therefore be on the
look-out for the facts which are necessary to enable him to
solve his problem.
(c) Special problems may be given to particular students,
so that while the whole class will get a view of the object of
the observation trip as a whole, particular pupils will make it
their business to make an intensive study of certain phases.
Commercial Geography 251
(d) The most important part of the observation trip,
perhaps, is the discussion and the reports after the trip.
This phase is frequently neglected. It is the unifying factor
in the observation trip. It brings together the various obser-
vations of the pupils, it results in the exchange of ideas and the
stimulation of thought, and it leads to the inquiry of causal
relationship.
4. Commercial Museums. — The commercial museum has
become a very important adjunct to the course in commercial
geography. It furnishes the concrete material that is so neces-
sary in the study of materials of commerce. Its purpose is
twofold : first, to illustrate concretely the materials of com-
merce; secondly, to trace the product through its various
stages of manufacture by showing samples of the product in
the various stages of manufacture. Sometimes the commercial
museum will also include a number of technical forms and
instruments of commerce, such as various kinds of commercial
papers, time-tables, charts, and other supplementary material
necessary to explain the technique of commerce. Material
for a commercial museum may be gathered with very Httle
difficulty. Business men and manufacturers are ready to aid
educational institutions by sending samples of their products.
The important thing, however, is to classify such materials,
and to catalogue them so as to make them available for class-
room use. The mere putting away of material in cabinets for
show purposes is not taking advantage of the opportunity at
hand. It may be that a classification of the products in
accordance with the old type of food, clothing, and shelter,
is as good as any. A twofold classification of the products
may also be advisable : first, a collection of raw materials of
commerce, and, secondly, a separate collection of materials in
their various stages of transformation.
252 Principles and Methods in Commercial Education
5. Pictures, Stereo pticons, and Moving Pictures. — Pictures
are an important concrete aid where the faciUties for first-
hand observation are lacking. They give us a view of how
other people live, of how industries are conducted which we
cannot observe at home. Pictures are not properly made use
of by teachers, because they rely upon the fact that the mere
showing of the picture will lead the student to observe. This
is certainly not true, because seeing the picture and observing
its details are generally not synonymous. In order to make the
picture of educational use, it should be discussed in the class,
and the significant features of it pointed out to the students.
In that way, each picture will furnish the equivalent of a
chapter in itself. The stereopticon lecturer who explains
the pictures unconsciously shows the correct educational
principle by leading his students not only to see the picture,
but to observe its details. The moving picture has come into
modern hfe as a valuable educational adjunct. By presenting
movement and change, it helps us to see the transformation
which an object undergoes. It can therefore be made an im-
portant means of showing students processes in manufacture
and industry in their development. The disadvantages of
both the stereopticon and moving pictures are that the pres-
entation has to be in the form of a lecture, that note-taking is
out of the question on account of the darkness, and that
questions during the lecture are impracticable. These diffi-
culties can be obviated to a great extent by questions and dis-
cussions after the lecture. These are necessary, otherwise
the exhibition will degenerate into mere entertainment with-
out instruction.
6. Maps. — The map in the study of commercial geog-
raphy is important, first, because of the way in which it makes
possible the discussion of routes of commerce ; secondly, the
Commercial Geography 253
way in which it emphasizes the relation between physiographic
features and commerce. The teacher of commercial geog-
raphy ought to have various kinds of maps.
(a) Reference Maps for the location of places under dis-
cussion. These maps cannot be used for study, because they
are too complete, and contain too much detail.
(6) Mercators Maps. These are maps designed to facilitate
the study of trade routes. On these maps the meridians appear
as parallel lines. They are the only maps which make it
possible to study intelligently the trade routes of the world.
The disadvantage, that the continents appear somewhat dis-
torted at the north, is relatively of little importance.
(c) The Globe. While theoretically all geography, in the
narrow sense, should be studied from, or with the aid of, a
globe, practically this is impossible. The countries are rep-
resented on too small a scale, and the difficulty of seeing the
places on the globe from every part of the room renders its use
impracticable. It should, however, be used supplementary
to the Mercators maps and as a corrective of possible wrong
impressions.
{d) Relief Maps. These are maps in which the elevations of
the diff erentcountries are represented in relief. They are a use-
ful aid in the understanding of the relation between altitude,
climate, and production, and they are also a great aid in under-
standing the obstacles of travel and the influence of natural
barriers upon commerce.
{e) In the absence of these relief maps, physical maps which
omit political divisions are a good substitute.
(/) Commercial Maps. These are maps which are sub-
divided according to commercial and industrial areas. They
serve to emphasize the fact that as far as areas of fertility are
concerned, the political boundary is a mere accident.
254 Principles and Methods in Commercial Education
(g) Railroad Maps. These maps should contain important
railroads of the country, conspicuously marked. They are
important for the study of the problems of inland transporta-
tion. Many may be obtained gratis from the railway com-
panies.
7. The Graph. — There is no other method so valuable as a
means of making alive the dry figures in tables of statistics.
An analysis of the function of statistics will make this clear.
Figures in themselves have as little meaning as facts in them-
selves. It is only in relation to other figures that they acquire
a meaning. Without such relation they are both dry and
meaningless. For this reason, the untrained mind finds itself
unable to grasp the content of a column of statistics without
some concrete aid. Various devices have been adopted
to furnish such aid. Readers of popular newspapers are
familiar with the device adopted by writers on economic
subjects, to convey to the mind the magnitude of certain
figures. In all cases, some relative standard is adopted.
For example, the magnitude of the cotton crop of the United
States is pictorially illustrated by a large bale of cotton, in
comparison with the size of which the pictures of the bales
representing other cotton crops appear insignificant. Simi-
larly, the writer on the merchant marine of the United States,
who wants to give a most effective argument in favor of a
measure to stimulate the growth of American shipping engaged
in foreign trade, draws a series of vessels,, each representing
the tonnage of a country. The tiny vessel which represents
the tonnage of the United States in foreign commerce looks
ridiculous alongside the great monsters representing England
and Germany, and this form of representation gets hold of
the imagination in a way which endless columns of figures and
discussions will fail to do.
Commercial Geography 255
The first function of the graph in the study of commercial
geography is to stimulate the mind to make comparisons of
the relative magnitude of a certain product in different coun-
tries, or the relative magnitude of different products in the
same country. It will be noticed that comparison necessitates
a common factor or denominator. This is the particular
product in one case, or the particular country in the other case.
Thus, it would be valueless, as a general rule, to compare the
magnitude of the copper tonnage in the United States with the
tonnage of coal in Germany, because the common element of
comparison is lacking. The graphic illustrations, such as
may be found in any standard text-book on commercial
geography, show how, by means of heavy Knes, we can make
a comparison of the magnitude of a product, such as wheat,
in different countries. A scale has to be determined in
advance, and the figures in the statistical table have to be
reduced to that scale. Graph or cross-section paper should
be used for the diagram, because it is more accurate, and be-
cause it saves time.
Relative magnitudes are sometimes represented by areas
instead of lines. Thus, an entire circle represents, let us say,
the wheat crop of the world, and different sectors of this circle,
cut in proportion, represent the magnitude of the crop in
different countries. The census office makes extensive use of
the circle. In general, the use of the circle has certain dis-
advantages. First, because it necessitates coloring the dif-
ferent sectors, and secondly, because the eye finds it difficult
to grasp in an instant the relative magnitude of different
parts of the circle, unless the contrast is striking. There-
fore, the circle does not lend itself to such accurate repre-
sentation as the Hne diagram.
There is another graph, to which alone the term properly
256 Principles and Methods in Commercial Education
belongs. It is of the highest utility in both commercial geog-
raphy and history in revealing to us growth and progress.
Thus, if certain lines drawn to a scale represent the popu-
lation of the United States in' the different decades, we may,
by connecting the ends of these lines, form a curve which by its
direction shows in a most striking manner the upward trend
of the population of the United States. The curve is partic-
ularly important in showing fluctuations. Take a table of
statistics representing the total exports and imports of the
United States. Reduce the figures to a scale and draw lines
representing these figures. Join the ends of these lines and
you have a fluctuating curve showing that the progress of
commerce is not entirely in an upward direction ; that there
have been fluctuations, depressions, and recoveries. Simi-
larly, by making one curve represent the exports and another
curve in another color of ink represent the imports, we can see
by the closeness of the approach of the curves at different times
how the balance of trade has varied in different years. We see
that they never crossed, showing that the volume of exports
was never exactly equal to that of the imports. The graphic
representation of these facts will not only show the state of
affairs, but will lead the mind to search for causes in explana-
tion of the state of affairs. This discussion of the facts and a
search for causes which it stimulates will be illustrated in the
appendix of this chapter by a lesson on the analysis of a table of
statistics.
It must be remembered that those graphs are most impres-
sive to the student, which he has constructed himself. But
if the time will not allow for sufficient work of this sort in the
class room in commercial geography, the drawing department
should be enlisted to aid in this direction. Besides, many of
the graphs could be constructed at home by the students.
Commercial Geography 257
Practice in the interpretation of graphs cannot, however, be
confined to those made by the students themselves. It is of the
highest importance to give the students the abiUty to interpret
facts and figures, and to look for the causes of facts. This
ability can be stimulated and developed only by extensive
analysis and discussions. For this purpose, the teacher in
commercial geography will have to have at his command a
number of graphic charts which can be hung up on the wall.
Even without such charts, crude graphs drawn on the black-
board will be of utility in the discussion.
SPECIAL METHODS OF TEACHING COMMERCIAL GEOGRAPHY
A great deal on this topic has been indicated in what has
been said before. It will be convenient in this place to sum up
and to supplement some of the matters treated. In what
follows, only rational methods are, of course, mentioned. The
old type of relying upon facts memorized from a text-book
deserves no serious consideration.
(i) Heuristic Method. — This is the ideal method of the in-
vestigator. It is particularly of value in the study of local
geography. It is a method in which the student gathers and
interprets his own facts. To make this method available at all,
the student must be taught how to gather facts and how to
interpret them. Suggestive questions in the form of problems
have to be submitted to him, and the line which he must
follow in order to solve the problems indicated. These
problems at first have to be of a very simple nature because the
solution of the larger problems in commerce requires training,
both in the gathering and sifting of facts and in their inter-
pretation. This at once points to the limitations of the
heuristic method.
It is too difficult for the amateur student, and it might
258 Principles and Methods in Commercial Education
lead to two extremes, both of which have to be avoided. In
one case, the student will be given a problem to solve without
any hint or suggestion as to the line of attack. He will
naturally give up before going very far, just like the person
to whom a difficult conundrum is submitted. The teacher will
be compelled to give the solution himself, and thus defeat
the very purpose of the heuristic method. The other ex-
treme is to give too many hints to the student and to solve
the problem for him practically in advance. The good teacher
will choose the golden mean between these two extremes.
The heuristic method as a method of first-hand observation
for the gathering of certain facts is indispensable in local
geography. The student must see at first hand the phenomena
of commerce and industry, and secure a foundation of
experience on the basis of which he can build up the funda-
mental concepts of commerce. Observation visits to indus-
trial plants and the first-hand gathering of simple statistical
information are both steps in the application of the heuristic
method.
(2) The Inductive Method. — The heuristic method is, of
course, a method of induction, too, because it proceeds from
the particular fact to the general law. The term " inductive
method," as used here, implies a modification of the heuristic
method, so as to eliminate some of its difficulties. The im-
plication here is that the teacher presents the facts to the
student, instead of compelUng him to gather them for himself
(as in the heuristic method), and helps the student to draw
generalizations from these facts. It is much more rapid than
the strict heuristic method, and is available in the study of
the remote environment of the pupil, such as localities and
industries not immediately accessible. It presents more
definite tasks to the student, and gives him all the necessary
Commercial Geography 259
training in the establishment of causal relationship. Never-
theless, it cannot entirely supplant the pure heuristic method,
because the information which it presents to the student is
derived more or less at second hand.
The steps in the process of generalization are clearly indi-
cated by the so-called formal steps in teaching. The analysis
of a table of statistics for the purpose of drawing conclusions,
or generalizations, is a good illustration of the application of
the inductive method.
(3) The Type Method. — This is a form of the inductive
method which has useful application, especially in those schools
in which the time allowed for the course is limited. In such
courses, the teacher, instead of attempting superficially to
cover the whole ground, chooses a portion of the field for
intensive study. Instead of attempting to study all the
different industries of a country, he chooses one or two indus-
tries as typical of all the others, and as throwing sufficient
light upon the processes necessarily involved in most industries.
Thus, in the study of the agricultural industry, the teacher
selects one particular crop and follows it through all its stages
from sowing to harvesting, marketing, and consuming. This
study becomes typical of all the other agricultural crops, and
gives the student an organized view of one of the ways in which
man extracts wealth from the earth. The study of the prod-
uct through its various transformations gives rise to a series
of generalizations, which are of use to the student in inter-
preting other phenomena of commerce.
(4) Deductive Method. — In the study of the formal steps
of teaching, we find that all induction must terminate in
deduction, or application. Superficial persons confound the
term deductive method with a method of memorizing rules
and facts from a text-book. This is not what is meant by the
26o Principles and Methods in Commercial Education
true deductive method. It is a method which begins with a
cause or a situation, and proceeds to trace the effect or to
apply the law to other situations. Where a knowledge of the
fundamental concepts in commercial geography has been
taught, there is a sufl5cient basis of rational knowledge of
causes and laws, which may be apphed to the deduction and
interpretation of facts. The deductive method thus proceeds
from cause to effect.
With a knowledge derived from induction — that an indented
coast means good harbors — it proceeds to study a coast
such as that of Africa, and to draw conclusions from the fact
that the coast line is smooth. These conclusions it proceeds
to verify by means of facts. If those conclusions are not cor-
rect, there must be other conditions which operate. For
example, we know that a certain region has very little rainfall,
and we conclude from that fact that its agriculture is in a very
poor state. Instead, we find that it raises great fruit crops.
In explanation of this inconsistency, we find that irrigation
has broken down the obstacles to agriculture placed by nature.
The advantages of the use of the deductive method are:
(i) In showing us changes as they progress, — causes as
they are at work in producing effects. The inductive method,
after all, while working in the reverse direction, is compelled
to retrace its steps, and become deductive in the end.
(2) It teaches us how to anticipate effects from certain con-
ditions. The ability to foretell or prophesy, so to speak, is a
very important one in business. How can we anticipate the
possible success of a particular venture? By being able to
trace the consequences which certain conditions will naturally
give rise to.
The use of the deductive method implies a broad basis of
experience, and cannot, therefore, be used at the beginning of
Commercial Geography 261
the work ; but in the more advanced topics it should be used
continually. For example, instead of beginning with the
products of the country and explaining why the particular
products are successful in that country, we ought to proceed
to a large extent by considering the natural conditions which
exist in the country, including the human factors, and trace
how these conditions have cooperated in creating the state
of affairs as it exists.
OUTLINE LESSONS
I. Cotton (Two Lessons)
Motivation : Uses :
(i) Importance to man.
(2) Wealth which it adds to the United States.
(3) Number of persons the industry employs.
Production of cotton : Agricultural phases :
(i) Growth of cotton : conditions, geographical distribution,
kinds of cotton. (Review of matter studied in biologic course
— Samples of raw cotton to be shown. Map showing geo-
graphical distribution of product.)
(2) Statistics of cotton production : analysis by means of
graphs ; growth of cotton production, historically, and causes
of this growth ; relation of slavery to cotton production
(correlation with history).
(3) Ginning of cotton : The cotton gin and its work (illus-
trated by pictures) ; importance of Whitney's invention ; the
seed and its uses.
Marketing of cotton :
(i) Methods of packing ; importance of packing ; (correla-
tion with physics).
(2) The cotton factor or commission merchant.
(3) The cotton exchange (untechnical treatment).
262 Principles and Methods in Commercial Education
Transportation to market:
(i) Shipment to ports ; comparative importance of the
different cotton export ports.
(2) Cotton shipments abroad (note dependence of Eng-
land upon American cotton and effect of Civil War upon Eng-
lish industry) ; effect of foreign shipments on balance of trade
(brief and untechnical treatment).
Manufacture of cotton :
(i) Conditions favorable to cotton manufacture. (Note
general principles favorable to any industry, such as (a)
Abundance of raw material, (b) Power, (c) Abundance of labor
and skilled supervision, (d) Good transportation facilities,
(e) Large market, and show the application of these prin-
ciples to cotton manufactures in New England and the
South.)
(2) Steps in cotton manufacture. (Shown by pictures and
specimens.)
(3) Statistics of cotton production, — treatment with aid
of graphs (analyze figures, and explain superiority of New
England over the South).
Future of cotton manufacture in America: The influence of
the Panama Canal in helping American manufactures, par-
ticularly in the Oriental trade ; importance of the Oriental
trade ; probable effect of the European war upon the future
of American cotton manufactures in enlarging their markets.
Note. The dividing line between the two lessons is
drawn on this basis :
The production, marketing, and transportation of raw cotton
constitute one unit; the manufacture of cotton and the eco-
nomic factors connected with the struggle for the world markets
constitute another.
Commercial Geography
263
OUTLINE LESSON ON ANALYSIS AND INTERPRETATION OF
STATISTICS WITH THE AID OF GRAPHS
Progress of Foreign Commerce of the United States
1900-1913
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Purpose of Lesson. — i. To enable students to grasp as a
whole the growth and fluctuation of the volume of commerce.
. 2. To see the relation between exports and imports, and note
changes in balance of trade. 3. To interpret the movement
and give causes for the fluctuations at different times. 4. To
apply ability to interpret statistics to similar statistical graphs
in general, and to the course of foreign commerce of the coun-
tries in particular.
Introduction. — (It is presumed that students have been
taught to convert a statistical table into a graph.) Students,
as a part of home work, may bring in graphical chart above.
264 Principles and Methods in Commercial Education
In later lessons this will not be necessary. It also can be
dispensed with at this stage ; but the teacher should have a
large graphic chart ready for class discussion.
Presentation. — Export Curve. What year marks the high-
water mark of export trade? The low-water mark? Is the
movement of the graph continually upward? In what period
is there fluctuation? (1900-1903, 1908-1910.) Where is it
horizontal? (1903-1904,1907-1908.) What does this denote ?
(No change.) In what period is the upward movement pro-
nounced? (1905-1907,1910-1913.) In what period is there a
downward movement? (1901-1902, 1908-1909.)
Import Curve. — Similar questions. Other questions to de-
velop the fact that steep upward grade indicates rapid prog-
ress ; steep downward grade, rapid dechne ; slight grade, slow
change.
Relation between export and import curve. Do the two
curves intersect at any point? When do they come closest
together? (1903 and 1910.) When are they farthest apart?
(1908, 1911, 1913.)
Generalization. — Generalized observations, i. Imports of
the United States are smaller than the exports. Balance of
trade is always in our favor. Wliy? 2. The volume of
exports and imports is not a continually increasing quantity.
There are periods of fluctuation.
Interpretation. — Why was there such a sharp upward
movement in 1905-1907? Because it was a " trade boom "
period. Why was there a check to it in 1907- 1908? Because
of the effects of the panic of 1907. Why was there such a
drop in 1908-1909 ? Because the full effects of the panic on the
business world did not show themselves until 1 908-1909. What
is the significance of the export curve from 1910 to date? A
recovery from trade depression.
Commercial Geography 265
Why was there such a drop in imports 1907-1908 ? Because
we retrenched on luxuries and cut down on the importation
of these. (Note that the export movement igoy-igoSis rela-
tively stationary instead of downward, because we are trying
to find a market abroad for our unsold goods, thus keeping
up the volume of exports.) Why is the balance of exports
over imports so great in 1908 ? Because we have been trying
to find a market for our goods, and cut down on our imports
of luxuries. Why is the balance so small in 1910? Recovery
from trade depression has taken place, we have made up for
our retrenchment in luxuries in previous years, and we do not
need to look for an expansion of our foreign trade, because of
the satisfactory domestic market.
Application. — Teacher will have ready charts of other
countries like Great Britain, France, and Germany. Pupils
will note, for brief comparison, relation of import and export
curve in these countries and develop reasons for excess of
imports over exports in Great Britain. Comparison made
between the state of trade in these countries during our
periods of depression and the state of trade in the United
States.
SYLLABUS IN LOC.\L INDUSTRIES OF NEW YORK CITY ^
Part I
Local Occupations : (i) of the neighborhood as ascer-
tained by the student ; (2) of New York City from the Federal
census; (3) Classification of these industries. (A) Extrac-
tive industries of New York City: (i) Function; (2) Loca-
tion ; (3) Advantages. (B) Manufacturing and mechanical
^ Course offered by the New York High School of Commerce since 1904,
which can be adapted to the study of any other industrial community.
266 Principles and Methods in Commercial Education
pursuits of the City of New York : (i) Function; (2) Needs of
the manufacturer, — (a) Raw material, (b) Supply of labor,
(c) Supply of capital, (d) Supply of power, (e) Access to the
market ; (3) Influence of each in locating local manufactures ;
(4). Other causes determining the location of local manu-
facturers; (5) Comparison of local manufactures with those
of the country, state, and nation according to, — (a) Capital,
(b) Laborers, (c) Wages, (d) Value of product. (C) Trans-
portation industries of New York City: (i) Function;
(2) Kinds ; (3) Character of traffic. (D) Trading industries
of New York City : (i) Function; (2) Kinds, — (a) Wholesale
and retail, (b) Specialty store and department store, (3) Ten-
dency to eliminate wholesaler and jobber. (£) Service
industries of New York City : (i) Professional service ; (2)
Personal service ; (3) Domestic service. (F) Banking and
funding facilities of New York City : (i) Function; (2) Kinds,
— (a) Banks, commercial, savings, (b) Trust companies,
(c) Building loan associations, (d) Insurance companies,
life, fire, marine, accident, etc. ; (3) Exchange facihties.
Part II
New York State. (A) Advantages of its situation:
(i) Importance of New York Harbor; (2) Superiority of
New York Harbor : Hudson River, Mohawk Valley en-
trance to the interior ; (3) Importance of Hudson-Champlain
route to the North ; (4) Significance of Long Island Sound.
(B) The chief extractive industries : (i) Farming and Dairy-
ing ; (2) Fruit growing ; (3) Market gardening ; (4) Oil and
naturalgas; (5) Lumbering; (6) Mining. (C) Thechief manu-
factures of the state: (i) Clothing, women's; (2) Clothing,
men's ; (3) Textiles ; (4) Foundry and machine-shop prod-
ucts ; (5) Furs ; (6) Newspapers and periodicals ; (7) Liquors,
Commercial Geography 267
malt ; (8) Tobacco, cigars, and cigarettes ; (9) Slaughtering,
meat packing ; (10) Printing and publishing, book and
job; (11) Localization of certain manufactures in particular
cities. (D) The transportation facihties of the state : (i)
Water routes, — (a) Erie Canal and its connections, (b) Barge
Canal, (c) Hudson River, (d) Lake Champlain and Canal;
(2) Rail routes, — (a) New York Central Lines, {b) Erie,
(c) Lehigh Valley, {d) Lackawanna, (e) Delaware & Hudson ;
(3) Pipe Hnes. (E) Banking facihties and financial suprem-
acy. (F) Commercial future of the state: (i) Development
of water power ; (2) Changes in kinds of agriculture ; (3) De-
velopment of the Adirondacks as sources of power, lumber,
iron, and recreation.
SUMMARY
Commercial geography includes a study of the way in which
man, by his industry, has subordinated the forces of nature to
his use.
The difficulties in teaching are due to making information,
rather than organization and interpretation, the end of the
study ; and to a lack of faciUty for obtaining first-hand infor-
mation. The second difficulty may be met by begiiming the
study with the geography of the locaHty.
The topics to be included in commercial geography are :
(i) the materials of commerce ; (2) physiographic conditions
which influence commerce ; (3) the human factors in com-
merce ; (4) the geography of the United States, of the state
in which the student hves. of our American neighbors, and of
the great commercial countries of the world.
The general principle of selection of material is that the
facts selected are to have some relation to the possible indus-
trial activity of the student. Specific principles are stated
268 Principles and Methods in Commercial Education
in the text. The facts selected must be organized, so that the
student will be able to hold them in mind, to give them sig-
nificance, and to relate them with the other facts in his pos-
session, in a complete system.
Aids in commercial geography are the text-book, reference
books, observation trips, the commercial museum, pictures,
stereopticons and moving pictures, maps, and graphic charts.
Special methods of teaching commercial geography are the
heuristic method, the inductive method, the type method,
and the deductive method. The use of the deductive method
implies a broad basis of experience. It cannot therefore be
used at the beginning of the work ; but in the more advanced
topics it should be used continually.
EXERCISES
GROUP ONE
1. Show wherein commercial geography and industrial geography
differ from general and physical geography. Discuss fully.
2. Discuss the difficulties in teaching commercial geography. How
may these obstacles be overcome ?
3. What is meant by the interpretation of industrial facts? How
may this power be acquired in the high school ?
4. State the principles which should guide the teacher in his selec-
tion of the materials of commerce for class-room use. Illustrate.
5. How should the text-book in commercial geography be used ?
6. What aids should the teacher employ in order to make his teach-
ing of geography vital ?
7. Define the heuristic method, and explain its application to com-
mercial geography.
8. What is meant by a "type" lesson? Discuss its value in the
teaching of geography.
9. Show the value of the deductive method in commercial geography.
ID. Give three graphic devices employed in commercial geography,
pointing out their uses and limitations.
Commercial Geography 269
GROUP TWO
1. Outline a lesson on "Localization of Industries in the United
States, " illustrating from prominent industries. Give in detail one section
of your lesson.
2. Suggest a system of classification of products for a commercial
museum.
3. Give the sequence of steps in teaching pupils how to use reference
books, showing progressively the reference books you would introduce.
BIBLIOGRAPHY
Text-books
Adams, C. C, A Text-book of Commercial Geography. New York, Apple-
ton & Co., 1908.
Gannet, Garrison and Houston, Commercial Geography. New York,
Amer. Book Co., 1905.
Robinson, E. V. D., Commercial Geography. Chicago, Rand, McNally
Co., 1910.
Smith, J. R., Industrial and Commercial Geography. New York, Holt
& Co., 1913.
Trotter, S., Geography of Commerce. New York, Macmillan Co., 191 1.
Books on Methods
King, C. F., Methods and Aids in Geography. Boston, Lee and Shepard,
1897.
McMuRRY, C. A., special Method in Geography. New York, Mac-
millan Co., 1903.
Sutherland, W. J., Teaching of Geography. Chicago, Scott, Foresman
& Co., 1909.
Teacher's Manual of Method in Geography. New York, Macmillan Co.,
1903.
Tildsley, J. L., The Study of Local Industry and Trade. N. E. A.
Report, 1905, p. 682.
Whitbeck, R. H., Commercial Geography. N. E. A. Report, 191 2,
P- 1057.
270 Principles and Methods in Commercial Education
Reference Books for Students
American Year Book. New York, Appleton & Co., annual.
Bullinger's Monitor Guide. New York, current.
Encyclopcedia Britannica. Eleventh edition.
Journal of Commerce and Commercial Bulletin. New York, current.
NoYES, F. K., Teaching Material in Govcrntnent Publications. Washing-
ton, Bur. of Ed., Bulletin No. 47, 1913.
Seligman, E. R. a., Principles of Economics. New York, Longmans
Green & Co., 1910. (Contains an admirable list of general refer-
ences.)
Statesman's Year Book. London, Macmillan & Co., annual.
Statistical Abstract. Washington, Bureau of Foreign and Domestic Com-
merce, annual.
Superintendent of Documents, Washington, publishes a monthly Price
List of United States Public Documents for Sale.
System (Magazine). Chicago, current.
U. S. Census, Considar Reports, and Reports of the Bureau of Foreign
and Domestic Commerce.
World Almanac. New York, Press Pub. Co., annual.
CHAPTER rX
Technique of Commerce
PURPOSE
The purpose of the course in the technique of commerce is :
(i) To relieve the course in Commercial Geography from
a part of its content, so as not only to improve the teaching of
what remains by making it more intensive, but also to organize
the content so taken out, on a more scientific basis. It has
been customary to make commercial geography the dumping-
ground for all kinds of topics, so that it has become the all-
inclusive subject. Unfortunately, it is impossible to cover
so much ground without giving the most superficial attention
to the topics involved.
(2) To make an intensive study of the functions of com-
merce, by giving the student a comprehensive view of the
human agencies, which, through the organization of the func-
tions of commerce, have made its growth possible.
(3) To give the background of experience for an intelligent
study of the principles of economics. The average student of
eighteen or nineteen, such as we would find in the last year of
the secondary course, is capable of studying the philosophy of
business, such as is found in the principles of economics, if
he has sufficient illustrative material to make the economic
laws concrete. According to this view, then, the course is
one in applied economics. It will be unnecessary to defend a
procedure by which the applications of the principles of eco-
271
272 Principles and Methods in Commercial Education
nomics are treated before the abstract principles themselves.
This method is only another illustration of the inductive
method. The same reason exists for such a concrete course as
for a course in inductive or applied geometry, as a preparation
for the study of deductive or Euclidean geometry.
The objection that it will be hard to observe the boundaries
of the subject of the technique of commerce, and that it will
constantly trespass upon the field of commercial geography,
need not give us any serious concern. There is no objection to
the study of commercial arithmetic because it reviews a
number of topics taken up in the elementary school arithmetic ;
nor is it an objection to the study of accounting to say that
a number of topics in bookkeeping are repeated, and that
therefore the boundaries between bookkeeping and accounting
are not observed. The point of view in both subjects is a httle
different, and the review of bookkeeping in accounting is from
a more scientific standpoint. This analogy does not com-
pletely explain the relation between commercial geography
and the technique of commerce, but simply points out the
fact that the point of view of the two is different. In com-
mercial geography, the centre of organization is, to a large
extent, the country or the locality, while the industry is sub-
ordinated with reference to that. In the technique of com-
merce, the centre of organization is the industry, while the
geographic element is made subordinate with reference to this.
Each subject, therefore, reenforces the other by viewing the
facts studied in the other subject from another point of view.
This does not imply that the field of commercial geography
is identical with that of the technique of commerce. In the
latter, the organized functions of commerce are discussed in a
very comprehensive way. In the former, they are treated
incidentally.
Technique of Commerce 273
DIFFICULTIES OF THE SUBJECT
The difi&culties which we found in the study of commercial
geography exist perhaps to a larger extent in this subject.
(i) The difficulty connected with the selection and organi-
zation of facts is not so very great, because the field is more
limited than that of commercial geography. Furthermore,
an industry, as a unit of study, lends itself to better organiza-
tion than a country or a material of commerce. But even in
this study, in order to avoid overwhelming the study with
details, it is necessary to choose typical industries and typical
processes as illustrations of general business laws and functions.
(2) The difficulty due to absence of facihties for first-hand
observation can be met by the use of pictures, concrete material,
and the use of the limited facilities for first-hand observation
that may exist in the community. Of course, facilities for
observing organized business do not exist to the same extent
in all parts of the country, but since organization is largely
a matter of schemes and documents that can be exhibited on
paper, the facilities for a concrete study of organization should
be available to all. The commercial museum should have, as
a part of its collection, documents, business papers, reports,
etc., as an aid to the study of organization.
(3) The greatest difficulty is due to the absence of an
available text-book. No matter what the abuses of the text-
book are, it nevertheless serves to unify the work of the
student. The difficulty is not insurmountable, in view of the
advanced character of the students to whom this course is
open. There are two ways open for the teacher. One is for
him to write a text-book in outline, and to present mimeo-
graphed copies of the outlines to the student as the course
progresses, and the other, to assign different topics for in-
274 Principles and Methods in Commercial Education
vestigation to different students, and to discuss the reports
brought in by these students in the class. This method is what
practically may be called the heuristic or seminar method, as
applied to this subject. The disadvantage of such a method
in this case lies in the fact that there is danger that each
student will pursue his investigation without regard to what
the other students are doing, and without making himself
acquainted with the work of the other students. This
difficulty is met, as we indicated in connection with commercial
geography, by holding every student responsible for a general
knowledge of the results of his neighbor's work. It may be
well to have a mimeographed outline prepared by the student
beforehand or as a result of his report, and to distribute it to the
other students for reference and for purposes of review. In
many instances the same topic may be presented to the class
as a whole, particularly where opportunities exist for observa-
tion trips, and a discussion of the result of this trip should lead
to generalizations upon the facts which operate in the world
of industry.
It must be remarked here that discussion upon the reports
or the observations, and systematic questions along the lines
of a report, is the only method by which the teacher can make
sure that the pupil is actively observing the facts, and par-
ticipating in their organization. The method of suggestive
questions in the way of problems furnishes the right incentive
for the students' active observation. The question suggests
the problems which the organizer meets with and how he solves
them. The inductive method, from fact to explanation, or
from effect to cause, has, therefore, extensive application.
Similarly, the method of proceeding from cause to effect plays
an important part. A form of organization being given, we
observe how this organization proves its worth in the exercise
Technique of Commerce 275
of the functions of commerce and in the accomplishment of
efficient results.
The sources for the study of the technique of commerce
have been made available in a compact way by the publication
of several excellent books, each of which deals with a special
phase of the subjects. While there are too many of the books
to use them all as general texts for the class, two or three of the
most important books might be used as such texts with excel-
lent result. But the substance of all of them can be made
available, to a large degree, by the assignment of different
portions of the books for reports and for reference, according
to the method indicated in the preceding paragraph. The
planning of a course in the technique of commerce is not very
difficult, if we keep in mind the analogy of the divisions of the
ordinary text-books on economics into production, exchange,
distribution, and consumption. A syllabus of the course will
be suggested by the headings that follow and by the discussion
of the reasons for including certain topics.
(i) Manufacturing. The classification of industries be-
longs largely to the subject of commercial geography. The
technical processes involved in manufacturing are considered
in other fields, such as physics and chemistry. The topics
connected with manufacturing which are to be included in our
course here are such as are connected with the organization
of the manufacturing plant, shop management, employment
of labor, the technical forms necessary to keep track of costs,
the relation of the different parts of the plant, and general
problems of overseeing work.
(2) Preparation for market. Too httle attention has been
paid in the past to the various methods in which the finished
articles are prepared for shipment. The question of packing
is a very important one. It is said America loses a good deal
276 Principles and Methods in Commercial Education
of its South American trade in competition with Germany,
because it overlooks the details which have to be observed in
insuring the safe arrival of the articles to their destination.
Here it must be observed that it is not the aim of this part of
the course to teach the intricacies of the method of packing.
Work of this sort would be of a speciahzed character, and
would require a laboratory or, at least, a museum. But the
main purpose of this work is to teach the student that an
important problem exists in business, — a problem that must
be met, and that cannot be ignored without inviting disaster.
(3) Transportation. This is probably the most compre-
hensive topic in the course on the technique of commerce.
It includes an account of problems of transportation by rail and
by water. While the course in commercial geography con-
siders routes by land and water, it does not take up in any
detail the organization of such transportation and its relation
to the shipper ; or the relation of the government to the rail-
roads. This course treats of such topics as the conditions
which determine the establishment of railway rates, the docu-
ments connected with shipping and railway transportation,
and the conditions under which articles are transported, —
all of which have to be considered, together with many inci-
dental topics.
(4) Marketing a product. In this subject, we have to
consider the relation of the manufacturer to the jobber, the
place of the middleman, the wholesaler and the retailer, and
the commission man. Certain recent phenomena in connec-
tion with marketing should be considered, such as the develop-
ment of the mail-order house, the growth of corporations, and
the tendency for the elimination of the middleman. The trust
as a phenomenon of modern business organization, can be
treated best in connection with the course in economics.
Technique of Commerce 277
Methods of reaching the consumer, such as advertising, should
also be considered under the head of marketing. This topic
should be made concrete by an analysis of typical modern
advertisements, for the purpose of arriving inductively at the
principles of advertising.
The work in advertising and salesmanship is considered
so important that several schools have already introduced
courses in these subjects in the last year of the secondary
school course. While we do not in any way underrate the
value of a knowledge of advertising and salesmanship, we
believe that in ordinary circumstances a special course in this
subject is not productive of the best results. The phases of
advertising that are connected with English and drawing
are easily handled. The psychology and the technique of
salesmanship may be easily taught in theory, but in practical
illustrations the results will be largely barren. Just as soon
as the schools have established cooperative relations with busi-
ness houses, such as are discussed in the last chapter of this
work, the introduction of a special course in advertising and
salesmanship will become a very valuable feature.
It is true that the defenders of such a course, under present
conditions, assert that it is possible for the student to practise
on the rest of the class by playing the part of salesman, and
trying to induce his fellow-students to buy. But it is evi-
dent that the conditions are far from analogous to those in real
business, because the mock customers have no real money to
give up ; and while they may be convinced by the arguments
of their fellow-pupil, it is a question whether they would be
similarly convinced if their money were at stake. We do
not imply that there is no value in a theoretical course in ad-
vertising and salesmanship without practice work. As a mat-
ter of fact, we advocate including a brief treatment of these
278 Principles and Methods in Commercial Education
problems in the course in the technique of commerce. But
our aim of work in this connection is not to make salesmen out
of pupils, but to give them a realization of the problems that
exist, and, if possible, to determine their vocational bent in a
specialized direction.
In evening high school and university extension work,
courses of salesmanship are very valuable, because they serve
the needs of students who are already engaged in practice,
because they give them new ideas which they can test, and
because they give them principles of action which they can
apply in real business. We consider that a special course in
advertising and salesmanship is of that highly specialized
character that we think out of place in a high school which
offers no practice work. But we repeat, that with the oppor-
tunities for practice work which the cooperation with the busi-
ness community would furnish to students of the last year,
such a special course would be very" effective.
(5) Exchange. This includes the very difficult subject
of money and credit. It includes a study of the functions
of money, the question of high price, the functions of banks
and other agencies of credit, the work of the credit man, the
mechanism of the stock exchange and the clearing house, and
foreign exchange. The subject is of such difficulty that it
should be postponed until some progress has been made in
the study of the principles of economics, of which it is properly
a division.
ECONOMIC ACTIVITIES OF THE GOVERNMENT
As a supplement to the course in the technique of com-
merce, there ought to be a study of the economic functions
of the nation, state, and municipal government. Possibly
this course ought to be made a part of the course in civics.
Technique of Commerce 279
It would be preferable, however, to put this work in charge
of the department of economics, because it deals almost ex-
clusively with economic functions, with which the teacher
of history may not be so familiar. Where the departments
of history and economics are the same, the task will, of
course, devolve upon the teacher of history.
As a matter of civic duty, it is incumbent upon every
citizen to know how the money raised by the community is
spent. It is a part of civic culture for a student to learn
something about the economic phases of the water supply,
of street paving, lighting, transportation, and something about
municipal accounting. The topic of the duties of citizens
is, of course, treated in the elementary school, but the broader
view of the activities of the community, particularly as they
affect the citizen from an economic point of view, is a sub-
ject that must be reserved for the more mature mind. In
the New York High School of Commerce a very comprehen-
sive course in municipal activities is offered to first-year stu-
dents. While they profit considerably by it, the advantage
of the course would be much more striking if it were post-
poned to a later period. The syllabus of the course in that
school will be found appended to this chapter. The matter
of municipal finance as well as public finance will have to be
treated after the student has some familiarity with the prin-
ciples of economics. The same rule, by the way, appUes
to the discussion of corporation finance. Logically, the sub-
ject of raising money should precede the discussion of the
way in which it is spent. But the consideration of the way
in which public moneys are spent lends itself to much easier
treatment than the other topic.
The relation of the state to business does not lend itself
very conveniently to independent treatment, because the
28o Principles and Methods in Commercial Education
state contributes indirectly to the promotion of industry
and commerce by means of its laws and regulations. Conse-
quently, such phases of pubUc regulation as the administra-
tion of our canals and the regulation of our public utilities
might be treated with better advantage in connection with
the subject of transportation. The dependence of commerce
upon the existence of a wise system of regulation should
be emphasized as frequently as possible, especially to impress
the learner with a higher conception of the meaning of gov-
ernment and his relation to it. The functions of the United
States government in connection with commerce are so much
connected with geographic questions that perhaps the sub-
ject might be left to commercial geography. In connection
with transportation, we have to study in detail the relation
of the government to the regulation of the railroads. Ques-
tions of pubHc finance, such as ways and means of raising
funds, the regulation of the currency and government finance,
may be profitably studied in connection with economics.
Aids and Methods. — As the aids and methods in the tech-
nique of commerce are practically the same as those in com-
mercial geography, it will be unnecessary to repeat them
here. The reader will find them discussed in Chapter VIII.
SYLLABUS IN MUNICIPAL ACTIVITIES ^
Part I
Origin of government in cooperation for public purposes ;
growth of government to meet increased needs arising from
the growth of population: {A) the town, the smallest unit
of self-government ; {B) the county, a group of towns ; (C) the
* Based upon the course of study offered by the New York High School of
Commerce since 1906, and easily adaptable to the needs of any community.
Technique of Commerce 281
village, due to the growth of a part of a town ; (D) the city,
a village grown large.
Part II
New York City: {A) Causes for consolidation; {B)
Greater New York Charter ; (C) Outline of New York City
Government. (I) How New York City gets its money :
(a) From taxation ; {h) From other sources (the general fund) ;
(c) From loans. (II) The Board of Estimate and Apportion-
ment : {a) Estimates income from (la) and (Jb) ; {b) Appor-
tions the income among the departments ; (c) Approves bonds ;
{d) Makes provision for the payment of corporate stock
through the sinking fund, which is in charge of the Sinking
Fund Commissioners ; the interest is an increasing annual
charge to be met out of the current income. (Ill) How New
York City gets its employees, — the Civil Service Commis-
sion under the administrative control of the State Civil Ser-
vice Commission.
Part III
The street, the central element of city life. Its capacity
for transportation controls the growth of the city. How the
city acquires land for street and other public purposes. The
street plan: {A) City plans; {B) Defects of the 1807
plan; (C) Improvements proposed in Manhattan possible
through excess condemnation; {D) How these defects are
avoided in new sections. Street pavements: {A) Construc-
tion; {B) Maintenance and repair. Transportation on the
streets: {A) Vehicular and foot traffic; {B) Surface and
elevated. Franchises: {A) What they are; {B) How
they are granted ; (C) What restrictions should be imposed
upon grantees. Transportation under the streets: {A) At
present municipal ownership and private operation of the
282 Principles and Methods in Commercial Education
subways with state regulation through a local board — the
Public Service Commission of the First District ; {B) Should
we have municipal operations? (C) Proposed extensions of
the present system. Street cleaning and refuse collection.
Refuse. Disposal. Sewerage system and sewage disposal :
{A) Sewerage for the protection of the public health;
{B) For protection of the harbor. Street lighting; light
and power distribution through the streets. Water supply:
{A) The Croton reservoirs and aqueducts; {B) New Cats-
kill reservoirs and aqueducts ; (C) Supply for Brooklyn and
Queens; {D) Supply for Richmond. Water distribution:
{A) Water waste and metering as a remedy; {B) High press-
ure system ; (C) Water rents. Street trades and miscel-
laneous uses of the street : {A) Licensing problems; {B) In-
cumbrances; (C) Permits for signs, stands, bay windows,
awnings, etc. Docks, improved street terminals. Bridges,
extended streets. Ferries, bridge substitutes. Fire: {A)
Protection from fire ; {B) Prevention of fire. Health :
{A) Positive work of the Health Department; {B) Prevent-
ive work of the Health Department. Tenement-house
Department: {A) Regulation of buildings other than tene-
ments; {B) Care and maintenance of public buildings.
Education. Parks and museums. The Department of
Charities, and Bellevue and Allied Hospitals. PoHce : {A)
protection of the public ; {B) Prevention of crimes ; (C) De-
tection of crimes. The local courts and the Department of
Correction. Taxation and the Department of Taxes and
Assessments.
Part IV
Review of the city activities through a more careful study
of the budget and per capita costs.
Technique of Commerce 283
PartV
The part of the citizen in local government: {A) National
and municipal parties ; {B) Party organization and manage-
ment.
SUMMARY
The purpose of this course is to organize a part of the con-
tent of commercial geography on a more scientific basis, to
make an intensive study of the functions of commerce, and
to give the background of experience for an intelligent study
of the principles of economics.
In order to avoid the difficulty due to a mass of details,
typical industries and processes should be selected. Other
difl&culties to be met are the hmited facilities for first-hand
observation, and the absence of available text-books. The
lack of text-books compels the use of a topical method of in-
dividual research and reports.
The syllabus in the technique of commerce follows the
analogy of the divisions of economics, (i) Manufacturing
includes the organization of industry; (2) preparation for
market includes the subject of packing ; (3) transportation
includes the technique of physical distribution by land and
sea; (4) marketing a product includes the study of modern
buying and selling organization, including the subjects of
merchandising, advertising, and salesmanship ; (5) exchange
includes the subjects of money and credit, banking, and
stock, cotton, and produce exchanges.
The course in the technique of commerce should be sup-
plemented by a study of the economic functions of the gov-
ernment and by a study of public and corporation finance.
The methods to be used in teaching this subject are similar
to those discussed under commercial geography.
284 Principles and Methods in Commercial Education
EXERCISES
GROUP ONE
1. Bound the field of the technique of commerce so as to distingiiish
it from commercial geography.
2. For teaching purposes, how would you divide the subject-matter
included in this chapter ?
3. Justify the inclusion of courses in advertising and salesmanship as
part of the high school course.
4. Why is it important to teach the economic activities of the govern-
ment ?
5. What use should be made of the principal government publica-
tions ?
6. How would you introduce the subject of technique of commerce to
a high school class ?
GROUP TWO
1. Modify the syllabus in municipal activities so as to adapt it to the
needs of your own community. Justify each change.
2. Outline a lesson on the organization of the United States Steel
Corporation, which could be used in an advanced class.
3. Prepare a set of instructions to be furnished the teachers of tech-
nique of commerce for the purpose of preserving unity of work in class-
room instruction and of minimizing the tendency to be diffuse.
BIBLIOGRAPHY'
General Works
Clow, F. R., Introduction to the Study of Commerce. New York, Silver,
Burdett & Co., 1901.
Eaton, S., How to do Business. Chicago, Monarch Book Co., 1896.
Hatfield, H. R. (Ed.), Lectures on Commerce. Chicago, Univ. of
Chicago Press, 1907.
Heelis, F. (Ed.), Theory and Practice of Commerce. London, Pitman &
Sons.
Meade, E. S., Business Geography, pp. 1 50-27 1 . Phila., Ziegler Co., 1902.
' See also pages 269 and 270.
Technique of Commerce 285
OxLEY, J. M., The Romance of Commerce. New York, Crowell & Co.,
1896.
Special
Calkins and Holden, Modern Advertising. New York, Appleton & Co.,
1905.
DuRAND, E. D., Finances of New York City. New York, Macmillan &
Co., 1898.
FiSKE, A. K., The Modern Bank. New York, Appleton & Co., 1904.
Johnson, E. R., Ocean and Inland Water Transportation. New York,
Appleton & Co., 191 1.
Johnson, J. F., Money and Currency. New York, Ginn & Co., 1905.
KiRKBRCDE AND Sterrett, Modem Trust Company. New York, Mac-
millan Co., 1913.
McVey, F. L., Modern Industrialism. New York, Appleton & Co.,
1904.
Meade, E. S., Corporation Finance. New York, Appleton & Co., 191 2.
Poor, H. V., Manual of Railroads. (Statistical Annual.) New York,
H. V. and H. M. Poor, current, 191 1.
Pratt, S. S., Work of Wall Street. New York, Appleton & Co., 1903.
Prendergast, W. a., Credit and Its Uses. New York, Appleton & Co.,
1906.
Scott, W. D., Psychology of Advertising. Boston, Small, Maynard &
Co., 1910.
Sheldon, A. F., Art of Selling. Libertyville, 111., Sheldon Univ. Press,
1911.
Sparling, S. E., Introduction to Business Organization. New York, Mac-
millan Co., 1906.
Taylor, F. W., Principles of Scientific Management. New York, Harper
& Bros., 1913.
White, H., Money and Banking. Boston, Ginn & Co., 1911.
CHAPTER X
History of Commerce
PURPOSE of the course
This course properly belongs to the department of history.
It is not wise to expect the commercial teacher to give in-
struction in this subject. The reasons are : first, his lack of
equipment in the way of a broad knowledge of the subject;
and secondly, his lack of training in methods of teaching his-
tory. Nevertheless, in connection with several of the com-
mercial subjects, such as accounting, commercial geography,
and law, the historical element should occasionally be brought
forward by the commercial teacher in order to throw light
upon the way in which a particular subject has grown to be
what it is. One of the greatest achievements of the nine-
teenth century has been the apphcation of the historical
method to the study of the social and economic sciences and
to the study of biology. In the latter, we call the historical
method the method of evolution.
This statement gives us a clue to the purpose of the history
of commerce; that is, the study of the development of the
important phases of modern industrial life from the stand-
point of how they came to assume the form that they have
to-day. The apphcation of the historical method to eco-
nomics has revolutionized that study; the application of
the historical method to the study of law tends to make
judges who are much more responsive to the interpretation
of legal principles in line with modern industrial conditions.
286
History of Commerce 287
Since the history of modern industries is the result of com-
plex circumstances, it is idle to expect to study it indepen-
dently of the history of institutions and culture. It is for this
reason that the regular department of history should take up
the study of economic history in connection with the larger
background of general history. If this is done, the phenomena
of commerce will appear related to the other historical phe-
nomena, and not in an unintelligent isolation.
The purpose of this chapter is principally to aid the history
teacher in the appreciation of those topics which are needed
to give an appreciation to the student of the growth of modern
industrialism. So important is the economic element in our
history, that certain theorists have maintained that all his-
tory must be explained on the basis of economic growth.
These theorists, while one-sided, represent a healthy protest
against the old view, which regarded history as a mere study
of kings and their fortunes, wars and the succession of dynas-
ties ; and even against the less narrow view of history as past
politics. Where a special course in industrial history is
offered, constant reference should be made by the teacher to
the general period in which the particular industrial event
occurred. Knowledge of general history should, therefore,
be presupposed and the connection of the economic events
with political and social history should be emphasized by means
of parallel charts of events.
The selection and organization of facts in economic history
furnishes problems similar to those to be found in commer-
cial geography, and what was said about methods of selection
and organization there applies to a large extent here. If we
bear in mind the true purpose of history, — the understand-
ing of our present institutions, in the light of our growth, —
we shall have a sure guide which will help us in emphasizing
288 Principles and Methods in Commercial Education
certain facts and eliminating others and a guide for the
organization of facts in causal series. These considerations
will show us :
1. That facts which are merely of antiquarian importance,
or which only satisfy curiosity, might, in large part, be
omitted ;
2. That those facts should loom in importance which ex-
plain institutions as they exist to-day ; and
3. That certain facts which may not be directly connected
with present conditions might, nevertheless, be studied, be-
cause they serve as lessons to guide us in our present Hfe.
An example of a fact of this sort is the failure of John Law's
scheme in the early eighteenth century. The danger and the
disastrous consequences of over-speculation are strikingly
illustrated there. But history repeats itself, and several
times the same results have shown themselves, because people
are either ignorant of the lessons of the past or are hopeful
that history will contradict itself for their benefit. The pre-
ceding discussion will show us what commercial topics may,
with great advantage, be emphasized by the history teacher.
SELECTION OF TOPICS
In ancient history, there is practically nothing of conse-
quence, excepting perhaps the exploits of the Phoenicians,
which have a mere historic interest. But the mediaeval his-
tory of commerce is of extreme importance, because the
foundations for modern commerce were laid in the Middle
Ages. In this period, political, social, and economic history
must be closely correlated ; otherwise, the period is entirely
unintelHgible. Here comes the folly of trying to teach the
history of commerce to a class which is ignorant of general
history, and apart from general history. An effective aid to
History of Commerce 289
organization is to take the mediaeval history of a particular
country, like England, as a type, and to consider the other
countries in relation to England, and in those important as-
pects which the history of England does not illustrate.
The development of the town is the core of the industrial
history of the mediaeval ages. But since the town was a
political creation and its development was dependent upon
political and religious aspects, it is necessary to refer to those
topics in order to throw light upon the growth of the town.
Hence, the development of the feudal system and the effect
of the Crusades are widely connected with the growth of the
town. The discussion of mediaeval markets and fairs is also
to be taken in conjunction with social and political condi-
tions, and similarly, the study of the merchant and industrial
guilds. The teacher of political history who discusses the
Magna Charta is apt to look upon the document as merely
political in character. If he reads it closely, he will see the
influence and the recognition of the merchant and artisan
class in that document, and the influence of industrial condi-
tions upon the development of constitutional history. This
power, by the way, is strikingly illustrated by the conditions
which led to the adoption of our own Constitution.
There are several topics which the study of industrial his-
tory of England does not throw sufficient light on. Some of
these are : the development of trade routes, and systematic
trade relations through the Italian city repubhcs and through
the Hanseatic League. In the discussion of these two topics
we have aspects applicable to modern industrial conditions,
which may be gathered; as, for example, development of a
consular system, the origin of the bill of exchange, and the
development of a code of international law.
The study of mediaeval commerce must stimulate the im-
290 Principles and Methods in Commercial Education
agination of the pupil so as not to lead him to make the mis-
take of interpreting conditions of those days by analogy with
present conditions. On the other hand, we must miss no
opportunity, where there are analogies, to point them out.
The student should not forget that a system of international
trade and industrialism, as we know it to-day, was unknown
in the Middle Ages, and yet we should not lose sight of the
roots of present conditions, which originated in those days.
In what is commonly known as the beginning of modern
history, one period receives something like adequate treat-
ment in the ordinary history, and that is, the period of dis-
covery, exploration, and settlement. But the mistake fre-
quently made by the student of general history is to look
upon the enterprises as individual exploits and as mere
stories of adventure. The student in the secondary school
should have outgrown the narrative or biographical stage of
history and have come to regard the study in the light of
economic and other motives of men, and the consequences to
which these led.
Other topics which should receive due attention in the
early period of modern times are the economic influence of
the Reformation, the development and strengthening of the
spirit of nationality, and the influence of a strong central
government upon commerce. The development of English
industries and commerce is a striking phenomenon which
should receive separate attention, particularly because the
history of England before 1776 is the history of our own
country, and because this history strikingly illustrates the
principles of industrial growth and the obstacles to it as re-
vealed by the mistakes which the continental countries made
and by which England profited.
The mercantile system, the development of banking, the
History of Commerce 291
corporations and trading companies, and the work that was
accomplished both in America and Asia close the history
of the early modern period and bring us to the threshold of
modern industriaHsm as we find it to-day.
The epoch-making event or series of events which ushered
in this period is called the industrial revolution. It is a
striking commentary upon the way history is generally
written, that an event fully as important as the French Revo-
lution, with which it was contemporary, receives practically
no attention in the general history text-book. This is because
of the fact that it lacks the spectacular elements of the other
events, and that its changes are not immediately apparent,
although, ultimately, much more permanent than the effects
of the French Revolution. It is an event which marks the
changes from the domestic system of manufacture to the
modern industrial system, and it should be traced in all its
consequences both in England and in the United States.
With the end of the eighteenth century, England ceases to
be the centre of organization for modern history, as far as
American students are concerned, and the industrial history
of the United States takes its place. But in connection with
the effects of the industrial revolutions, England is still the
ideal type of organization, because the effects of the industrial
revolution and the attempt to meet those effects, by factory
and labor legislation, followed through the nineteenth cen-
tury and down to the present day.
The chief topics in connection with the industrial history
of the United States would be exemplified by the way in
which the new country was conquered by the pioneers, by
the influence of immigration, and by the utilization of our
natural resources. The industrial history of the United
States, through the national period and up to the present day,
292 Principles and Methods in Commercial Education
may be ideally correlated with commercial geography, be-
cause of the fact that this country gives us illustrations of
primitive conditions which are more or less recent, and which
the European countries do not give us so readily. The de-
velopment of this country beautifully illustrates the condi-
tions under which man, in his struggle with nature, masters
it for his own purposes and for the betterment of man-
kind.
Recapitulation of point of view governing in the history
of commerce : (i) Those topics are selected which show the
gradual conquest of the earth by man. (2) One country is
made the centre of organization. (3) The development of
commercial phenomena is treated to some extent independently
of national Umits, especially in the topical reviews. Thus, the
growth of the mercantile system cannot be viewed and prop-
erly understood in connection with one country alone. In
this topic, the mercantile system, not the country, is the type
of organization. (4) Correlation with economic geography
should constantly be kept in view.
METHODS OF STUDY
(i) The Text-book Method. A good text-book should be the
basis of the work. The teacher should have such works as
Gibbins's or Cheney's " Industrial History of England " and
Coman's " History of the United States " as supplementary
text-books to the general works in the course. Since topics,
as in commercial geography, need not be assigned by pages,
the use of several books is no disadvantage, especially as the
student has been taught how to use his text-book as a refer-
ence book. The text-book recitation method alone is apt to
make the study dry and uninteresting, and may give the
student an inadequate idea of the meaning and source of his-
History of Commerce 293
torical facts. It must therefore be supplemented by other
works. The use of a large number of books gives rise to what
may be called the topical method.
(2) Topical Method. In this method students are as-
signed different portions of a topic to work up, and do not
use the same text-book from which to work up the topic.
The advantage is that all the contributions of the student
bear upon the main topic and omit unessential details, and
students get a fulness of information impossible to obtain
from a single text-book. The disadvantage is that the lack
of a text-book is apt, in a secondary school, to deprive the
work of its unity, and to divide responsibility in failing to
estabHsh as its minimum requirement the knowledge of a
text on the part of every member of the class.
(3) Source Method. The advocates of this method believe
that history ought to be studied from first-hand sources :
accounts of eye-witnesses, journals, letters, inscriptions, etc.
They believe that only in this way will students get the
right idea of how history is made, and the opportunity to
draw their inferences as to the significance of events instead
of having to accept the conclusions of others. The objection
to the use of this method in the secondary schools is that the
proper historical perspective cannot be obtained from the
accounts of contemporaries. Furthermore, it takes a highly
trained mind to draw inferences from historical facts. The
teacher is doing enough if he leads the pupil to grasp the
inferences of great historians and shows him how to verify
these conclusions by reexamining the facts for himself. The
use of sources is therefore supplementary to the main work
and not primary. " The aim of historical study is not so
much training in the art of historical investigation (a training
which the source method gives) as in thinking historically.
294 Principles and Methods in Commercial Education
The importance of sources lies in the fact that they teach
the pupil that he is deahng with Uving characters."
Sources are valuable as an adjunct to the regular work,
because they make the study more concrete by making the
characters of the past, for example, speak and act Hke Hving
persons, and because they, therefore, give a vivid picture of
the life and state of society in the past. But the source or
" seminar " method, as such, is inapplicable to the secondary
school as far as history is concerned, although its analogue,
the laboratory method, is of high utihty in commercial geog-
raphy,
(4) Combined Method. The teacher uses all the good
features of the preceding methods, (a) He uses a single text-
book, because it gives unity to the work and centres respon-
sibiHty. {b) He groups the events in topics, and assigns work
in other books supplementary to the ground covered in the
text-book. This work consists either in summaries of chap-
ters from other books, or in larger reports combining the sub-
stance of several books on the topic, (c) He uses the source
method in assigning topics which are supplementary to the
text-book and which require the student to examine sources.
(5) Other Suggestions on Method, {a) The formal steps
of teaching are not of very great assistance in connection
with history, because history is not primarily a scientific sub-
ject, — one in which it is intended to derive certain generali-
zations. It is true that one of the purposes of studying the
subject is to develop the historical judgment by giving the
student the ability to judge men and events in the past, and
to transfer the results of these judgments to the judging of
men and events of the present. On the other hand, it must
be borne in mind that the greater part of the effort of the
teacher should be devoted to give the student a view of a
History of Commerce 295
period, as a whole, in all its activities. The first appeal is,
therefore, to the imagination, — an appeal that is aided con-
siderably by pictures, documents, and other concrete material.
To look upon history, therefore, as a subject which is
principally designed to furnish us with generalizations and
appHcations, and to follow the sequence of the so-called
formal steps of teaching, is to distort the historical perspec-
tive and to lead to hasty and valueless generahzations. The
causal series is, of course, of the highest importance. We
want to see the facts in their causal sequence and not merely
in their time sequence, but the facts of history can best be
understood by tracing them as consequences of causes rather
than discovering the causes from the effects.
A rational deductive method is of the highest utility in
history. To illustrate : In tracing the development of New
England as a manufacturing centre, we might take the con-
dition of New England as it is to-day and work backwards
in order to trace the causes of such growth. A procedure Hke
this would be appropriate enough in commercial geography,
but in history it would be doing violence to the chronological
order. The proper method would be to show certain con-
ditions as they existed in New England at the beginning of
the nineteenth century, and trace how inevitably these con-
ditions led to certain consequences. This is the method of
going from cause to effect. The formal steps, on the other
hand, lead from effect to cause.
{h) One of the most serious defects in teaching history
consists in giving the pupils words or concepts which they
do not understand. A most striking illustration of this sort
is the use of the term " charter " in connection with the early
American colonies. The term " charter government " is
flung at the pupils without any clearing up of its historical
296 Principles and Methods in Commercial Education
significance. One reason for this in the elementary schools
is that we do not bring in sufficiently the industrial back-
ground of poHtical history. The student of industrial his-
tory should see that America was settled by the enterprise
of trading companies which expected to make a profitable
venture. He sees that these companies received privileges
from the king, and these privileges were embodied in a charter
which practically became the law under which the colony
was governed. The analogy with the franchise of a public
service corporation or the charter of an incorporated society,
in which the privileges of the corporation are not only defined
but restricted, should be made use of to throw light upon
the historical concepts as we find them. Nothing will help
so much in the understanding of the historical forces at work
as the calling up of a living picture of the period. Hence the
great importance of aids in historical teaching to accompHsh
this end.
AIDS IN HISTORICAL TEACHING
{a) Maps and charts. In using maps the teacher must
be careful to use maps of the period in illustrating historical
events, and not maps of to-day. It interferes with the work-
ings of the historical imagination to illustrate the American
colonial period by using a map of the United States of to-day.
(h) Visiting of landmarks. Very limited use of this can be
made here.
(c) Pictures of men and places.
{d) Use of graphic methods, such as statistical charts and
curves, to illustrate such facts as the growth of the popula-
tion of the United States, etc. They give a concrete image of
the development and the relation of events, which can readily
be grasped by the mind which is repelled by dry lists of facts
and figures.
History of Commerce 297
(e) Note-books. In these the student jots down the
oral account supplementary to the text-book, which the
teacher gives to the class, as well as an abstract of the
reports of other students on topics assigned them outside
the book.
(/) School Ubrary.
SUMMARY
The history of commerce can be studied effectively only
with the background of general history. Hence, its teaching
does not belong to the province of the commercial teacher,
but to that of the teacher of general history.
The selection and organization of facts in the history of
commerce is determined (i) by the necessity of explaining
the historical development of the phenomena of commerce of
to-day ; (2) by the value of studying the lessons of success
and failure of experiments of the past, as a guide to present
conduct.
In mediaeval history we find the roots of many of our
commercial institutions. The history of England may be
made the centre of organization for the study of the mediaeval
history of commerce and of modern history up to the nine-
teenth century ; and especially in connection with the causes
and results of the industrial revolution, which is one of the
most important topics in the history of commerce. In the
nineteenth century the United States may be made the basis
of organization.
The methods of stud3dng history are (i) the text-book
method ; (2) the topical method ; (3) the source method ;
and (4) the combined method. The formal steps of teaching
have only a Hmited appHcation to the study of history. In
teaching history, concepts are frequently given which are
298 Principles and Methods in Commercial Education
abstract and empty. Important aids in making the study
concrete are maps, landmarks, pictures of men and places,
use of graphic methods, note-books, and supplementary
books in the school library.
EXERCISES
GROUP ONE
1. Under what conditions would you teach the history of commerce
as a special subject ? Which department should take charge of it, —
the department of commerce or of history ? Why ?
2. Give an illustration of some concept in the history of commerce
(like the guilds or the town) , and show how you would make it concrete
to the student.
3. Give the relative uses of the text-book method, the topical method,
and the source method in the teaching of industrial history.
4. Discuss the value of maps and charts in history, treating of the
following points : {a) their uses ; {b) methods of utilizing them to the
best advantage ; (c) their limitations.
5. Show, by reference to the origin and rise of corporations, how you
would correlate the history of commerce with law.
6. Outline a lesson on the development of banking. How would you
correlate this topic with the principles of banking discussed in economics
or in the technique of commerce ?
GROUP TWO
1. Illustrate the going from cause to eflFect and from effect to cause in
history, and show when each form of movement is used.
2. Choosing as your topic the manufactures of New England, give a
lesson designed to bring out the influence of geography upon history.
BIBLIOGRAPHY
BOGART, E. L., Economic History of the United States. New York,
Longmans, Green & Co., 1908.
Bourne, H. E., Teaching of History and Civics. New York, Longmans,
Green & Co., 1902.
History of Commerce 299
Cheney, E. P., Industrial and Social History of England. New York,
Macmillan Co., 1908.
CoMAN, K., Industrial History of the United States. New York, Mac-
millan Co., 1905.
Day, C, History of Commerce. New York, Longmans, Green & Co.,
1907.
GiBBiNS, H. B., Industrial History of England. London, Methuen &
Co., 1906.
Mace, W. H., Method in History. Boston, Ginn & Co., 1897.
Webster, W. C, General History of Commerce. New York, Ginn & Co.,
1903.
CHAPTER XI
Commercial Law
difficulties and faults of teaching
This subject suffers almost as much from faulty teaching
as commercial geography. One of the serious obstacles to
improvement in this direction is the fact that very Uttle has
been written on the subject of the teaching of law, particu-
larly from the standpoint of the secondary school. On the
other hand, there are a number of works on method in
geography, and the text-books themselves throw a great deal
of light on methodology in the subject. While there are
several satisfactory text-books in commercial law available
for secondary schools, they do not, as a rule, throw sufficient
light upon the adaptation of the principles of teaching to
instruction in law.
The defects in the teaching of law in secondary schools are
due to the following causes : (i) Lack of appreciation by the
teacher of the true purpose of the subject. Those who frame
the curriculum, too, are vaguely aware of the fact that train-
ing for business requires some knowledge of law. But a
purpose, in order to be helpful in guiding the teacher in his
work, should be more definitely formulated, and this will be
done below. (2) A lack of scholarship on the part of the
teacher. The latter can hardly be held to a serious respon-
sibility for this lack, because he is generally a layman in the
subject, and having many different branches to handle, it is
very difficult for him to give expert attention to this subject
300
Commercial Law 301
unless he has some definite guidance. On the other hand,
it is generally difficult for a school to find a teacher who has
had a law school training. Where such a teacher is avail-
able, of course, this difficulty falls away, but even in the case
of a layman, the difficulty due to lack of scholarship is not
insuperable, and it will be shown how the teacher who has
had no legal training can perfect himself, at least to the extent
of obtaining the proper breadth of view and understanding
of the sources of the law, from which he can add to his im-
perfect store of knowledge when occasion requires. (3) A
violation of the important principles of teaching, due either
to ignorance of pedagogy or to inability of the teacher to
apply the principles of teaching to commercial law, because
of his failure to grasp the true purpose of the study, or to
understand the various parts of the subject in their organic
relation.
The notion that any one who understands the subject is
properly equipped to teach it has long ago been exploded.
The lawyer, therefore, may have an excellent grasp of his
subject, but it does not follow that he will necessarily make a
good teacher of commercial law, because of his ignorance of
methods of teaching it. And thus, we find many great scholars
in a subject who are utter failures when they attempt to
teach their subject ; a fact which has led a cynic to remark,
that a person's ability to teach is in inverse proportion to
his scholarship. Of course, we subscribe to no such heresy.
While it is true that the good secondary school teacher, who
is excellent in his methods of presentation and drill, will,
nevertheless, fail as a teacher of commercial law, if he lacks
breadth of view, scholarship, and proper perspective, we
nevertheless hold that with only the fractional scholarship
in law which the lawyer possesses he will make a very much
302 Principles and Methods in Commercial Education
better teacher than the latter, because he will keep on the
level of his pupils' attainments, he will arouse their self-
activity, and he will give them the necessary amount of in-
telligent drill.
The knowledge of the principles of teaching is, therefore,
of great importance, and without it all the scholarship in the
world will not avail. On the other hand, there are special
problems connected with the teaching of commercial law and
special methods which grow out of an appreciation of the
true purpose of the subject. Consequently, the commercial
teacher, even though he has been trained in pedagogy, must
understand the true purpose of the subject and the special
problems in method which arise in the attempt to realize this.
We must therefore pass in review the purpose which underlies
the teaching of the subject in the commercial school.
VALUE OF THE STUDY
Utilitarian Value. — We noted in Chapter I the general pur-
pose of the study of commercial law as an element in business
education, and we found that men in business, in their deal-
ings with each other, constantly come into difi&culties in which
they must safeguard their rights. This they can only do
properly if they know the law. Of course, it may be sug-
gested here that a business man who is his own lawyer has a
fool for a client, but it is not the intention that he should
study law in order to be able to conduct his own litigation.
It is imperative, however, that he should know how to in-
trench himself in all his contracts and other legal relations
so as to protect himself against unwarranted attack and to
provide himself with the arms to enforce his rights, if they
should be challenged. A good deal of unnecessary litigation
would be avoided if every person, at the time he entered into
Commercial Law 303
his contracts or business engagements, safeguarded his rights
in the proper way. While it is true that for his more important
contracts he will consult his lawyer, there are numerous
occasions in which he does not have the lawyer at his beck
and call, in which he must act quickly, and in which, there-
fore, his knowledge of law will be of the greatest help.
As a general rule, in spite of carping critics to the con-
trary, the standard of commercial integrity is high, and
business men carry out promises which they could avoid
through legal technicalities or flaws. If this were not the
case, the courts would be flooded with litigation. On the
other hand, faith in the integrity of the person he is dealing
with has led many a business man to great losses, which
could have been avoided if he had known the law. The mere
knowledge by an unscrupulous opponent of the legal strength
of a person's position leads him to refrain from attack or
from avoiding his obligations. To sum up, then, we may
say, almost paradoxically, that a man in business should
have a knowledge of law, not in order to practise it, but in
order to know how to avoid Htigation.
In a more narrow utilitarian sense, the study of law is of
very great importance to the student who contemplates
specializing in the profession of pubHc accountancy. Prob-
lems which the accountant has to solve are intimately con-
nected with legal questions. While it is true that in most
important matters the lawyer will be consulted, the ac-
countant who is properly trained in the fundamental prin-
ciples of law will detect legal points, the consideration of
which is of highest importance to the business ; — points the
existence of which neither the lawyer nor the principal would
have been aware of, without the assistance of the speciaHzed
knowledge of the accountant. No wonder, then, that com-
304 Principles and Methods in Commercial Education
mercial law is one of the required subjects of the examina-
tion for the degree of certified public accountant.
It may be objected that the place for this study should be
the university and not the secondary school, because it is
not the function of the latter to prepare for the practice of
the accountant's profession. While it is true that it is not
the function of the secondary school to give specialized prepa-
ration in a particular line of business activity, it should,
nevertheless, lay a broad foundation in law, on the basis of
which the university student who specializes afterwards in
a particular phase of the subject can pursue his narrower
field with the proper perspective. Again, a number of sub-
jects studied in the secondary schools, such as accounting,
will be repeated in the university. But this repetition will
be, not a case of travelling over the same ground, but a spiral
repetition. The point of view will be broader, and the work
at the same time will be more intensive. A good foundation
laid in the secondary school will be of immense help in the
more advanced study of the same subject in the higher school
of commerce.
Culture Value. — We have spoken of the utilitarian value
of the study of law. There is another view, the broad
cultural one, which deserves consideration. Every educator
reaUzes the importance, in education for citizenship, of a knowl-
edge of our institutions to those who are going to participate
in maintaining them. The course in civics partially supphes
this need by training the future citizen to comprehend the
sources and development of our institutions, and his relation
to them. Every well-arranged course in civics devotes con-
siderable attention to what may be called public or constitu-
tional law, including the work of our legislatures and of our
executives and the duties of citizenship. But the work of
Commercial Law 305
our courts is given very little attention in the ordinary course,
beyond a statement of the kinds of courts and their jurisdic-
tion. The great body of private law which regulates the
legal relations of individuals in society to each other is en-
tirely neglected. The work of the courts which have been in-
strumental in establishing this great body of law, the study
of the problems they have met, and how they have attempted
to work them out, the meaning of precedent, the value of
establishing a general rule which will also work out sub-
stantial justice, — these are all problems which, in great part,
are neglected by the student of civics.
The good course in commercial law, in supplying this need,
contributes in great part to the culture of the citizen by
giving him a better knowledge of the meaning of our institu-
tions, and of his duties to the state and to other individuals.
Furthermore, a knowledge of the workings of our courts is
indispensable in connection with intelligent opinion and
action on such subjects as the recall of judges and judicial
decisions. How can a person unacquainted with the basis of
our law and the function of our judges and the bases of their
decisions vote intelligently upon any proposition involving
our judicial system? The study of law gives us not only a
better view of the growth of our institutions, but it also
gives us a better understanding of many of the established
forms of commercial life. No student can understand such
subjects as the evolution of corporations or the development
of the use of negotiable instruments, without an understand-
ing of the growth of the law on these subjects. The study of
commercial law will, therefore, throw interesting light upon
the growth of commercial institutions and instrumentalities.
Just as history throws light upon law, so, conversely, the
study of law will throw light upon industrial history.
3o6 Principles and Methods in Commercial Education
Disciplinary Value. — Another aim which is going to in-
fluence the teacher is the disciplinary one. Irrespective of
whether the powers gained from the study of law are trans-
ferable to other subjects, it is nevertheless true that the aim
of the teacher to give the student power to reason about law,
rather than information about it, will influence, and, in fact,
direct the instructor's course in the presentation of the sub-
ject. It is peculiarly true of law, that the uninitiated look
upon it as a subject crammed with facts that must be memor-
ized in great part by the student, and they look with awe upon
the many formidable tomes in which the law is found, and
which they surmise the person who would be learned in the
law must absorb. One who knows what the study of law
means realizes what a misconception underlies this view. A
lawyer's knowledge of the law is one of fundamental prin-
ciples, and it involves not merely familiarity with the prin-
ciples, but ability to recognize the principle as it appears in
numerous concrete situations or cases. The ability to apply
the principle, the ability to sift and digest decisions, to recog-
nize differences between apparently similar situations, and
similarities in apparently diflerent cases, and to reconcile
apparent contradictions, — all this is a matter of training of
judgment and reasoning, and not a mere matter of knowledge
of abstract rules. It is therefore evident that the aim of the
teacher should be the development of power to reason about
law, of the ability to apply the law to various situations, and
of the power to find the law on any subject whenever one
needs it. The ability to conduct research is very essential
to a lawyer, because his argument is, to such a large extent,
based upon authority. This ability may be of minor im-
portance to the secondary school student, but it has an in-
teresting phase, which will be discussed later, in connection
Commercial Law 307
with the advisability of research work, by the student of our
course.
This view of the aim of the teacher, which directs him to
look to the development of power in the student, rather than
to imparting information, is emphasized, because it has an
influence upon methods of teaching and upon selection of
material to be taught. Following are some of the aspects to
which this view leads :
(i) The teaching of law is not principally designed to fur-
nish a mass of information to the student. This is because
the information is too vast and unorganized and because
there is too much of it that is apparently conflicting or in-
consistent. The legally trained mind should be able to recon-
cile apparently conflicting decisions when these are not in
direct opposition, to understand the fundamental reasons
back of the decisions, to appreciate the reasons which have
led the courts to deviate from the former decisions, and to
comprehend the distinguishing elements in cases which to the
lay mind are apparently similar. This ability requires train-
ing in judgment and reasoning, both of which are exercised
by practice. An opportunity for such practice is given by
the teacher when he asks the student to decide a certain case,
to give the reasons for a given legal decision, and to say
whether he agrees with the decision or not.
(2) A second direction in which this view influences the
teacher is in the handling of principles upon which there is
no unanimity in the various states. As our text-books are
not intended to have their use restricted to a particular state,
they attempt to do justice to all sides, by mentioning that
the law in some states is thus and so, while in other states it
is different. Now, as a piece of information judged from the
point of utility, this is valueless. If we live in New York
3o8 Principles and Methods in Commercial Education
State, we want to know what the law in New York is, and
(again if we keep the utilitarian side in mind) what the
law in other states is does not concern us. This so-called
practical point of view was formerly taken by the New York
Board of Law Examiners, who marked an answer incorrect,
no matter how sound its reasoning, or how much in accord
with the common law, unless it was in harmony with the law
in the state. In line with this poHcy, the same board gave
partial credit for answers which were correct, but which
contained no reasons. Under the direction of the court the
Board has recently reversed its attitude and now gives credit
principally for the soundness of reasoning of the answer.
This should be the attitude of every teacher who is marking
examination papers, — to give no credit for guess answers
and to rate the papers principally on the ability to reason
which they display.
We may sum up the reason for mentioning conflicting
decisions on any subject, even if a decision in the state in
which the student Hves is clear and definite. It is the same
as the reason which prompts the case books to give dissenting
opinions of judges. The discussion of conflicting views
gives the student a better insight of the reasons which
prompted the decision ; it gives him the power of judgment
to weigh in the balance opposing opinions ; it trains him to
think about law, rather than to remember mere decisions or
statutes, by discouraging guesswork and putting a premium
on reasoning.
In the preceding paragraphs we noted that the develop-
ment of power to think law, rather than the knowledge of
legal facts, should determine our aim in teaching commercial
law. What will be the result of teaching the subject with
such an aim in view ? Obviously, there will be a gain of power
Commercial Law 309
to analyze legal situations, to apply principles to states of
fact, to understand the reason for certain rules of law, and
to deduce consequences from these rules. We may add that
the necessity of apprehending a given case requires the stu-
dent to put himself mentally into the situation which gave
rise to the dispute. Otherwise, his judgment will be abstract
and mechanical. In his constant efforts to reproduce the
various conditions which give rise to Htigation, and to get a
sympathetic apprehension of the facts, a student will culti-
vate his imagination.
Some may say that the development of judgment and
imagination will be of use only in connection with legal facts,
and that those powers as gained from the study of law will
not be capable of transfer to other subjects. In reply it may
be said that law cases deal with concrete phases of Hfe ; that
the problems of law are such as one might meet in everyday
affairs ; and that therefore the trained lawyer has more
power and aptitude to apply his ability to situations outside
of his profession than the trained professional man in any
other vocation. It is for this reason that we find lawyers
occupying most of the administrative positions in pubHc life
and even in the commercial and financial world. Those who
belittle the disciphnary value of a study have particularly
in mind the student of mathematics who, in spite of his
great power to reason in his specialty, may show no aptitude
whatever in other affairs of life. This is due partly to the
abstract nature of mathematical facts and to the failure of
teachers to show the applicability of these facts to concrete
experience. On the other hand, the defender of mathematics,
especially of geometry, points to the valuable training the
student derives in learning how to deduce the logical conse-
quences of a given hypothesis. In this respect, however,
3IO Principles and Methods in Commercial Education
law is not at a disadvantage. The student is constantly
required to trace the results growing out of a given situation
(hypothesis) ; he notes how changes in the facts give rise to
different decisions, and he thus gets valuable training in de-
ductive reasoning. In other words, the training in judgment
and reasoning derived from the study of law is more valuable
than the similar training in reasoning derived from deductive
geometry. While it is true that the chain of reasoning in
law is not so rigorous as in mathematics, this defect is made
up by the concrete content which it possesses, and which
therefore helps to make the power derived from it applicable
to other fields of study.
Correlation Value. — The study of commercial law is also
valuable if properly pursued, on account of the light it throws
on other subjects. In the history of commerce we trace the
development of commercial institutions and instrumentalities
of commerce. Most of the phases of law are the outgrowth
of conditions which had to be met in defining and safeguarding
the rights of persons in their dealings with others. Any
study of law which leaves out of sight the historical or de-
velopment element misses an important possibility for cul-
ture and loses a phase without which the principles are only
partially understood. This is particularly true of the law of
merchants and the Statute of Frauds. The development of
law is necessarily a reflex of historical conditions, and thus
history and law reenforce each other.
In connection with arithmetic, we find similar correlation
elements. The student of arithmetic who reads about legal
rate of interest. United States rule (in partial payments),
days of grace, interest on accounts overdue, etc., has only a
vague notion of what these terms mean. The good teacher
of arithmetic, of course, explains these matters to the class.
Commercial Law 311
But as the study precedes that of law in the course, the
understanding of these notions is only vague. Not until the
student takes up commercial law is there an opportunity
for a complete exposition of these topics in arithmetic. And
it is the duty of the teacher of law to add a familiar touch
by referring to those topics in arithmetic which the study of
law helps to clear up. Similarly, commercial law, deaHng
as it does with business, naturally gives to the students
interesting side-lights upon many forms of business practice,
— forms that are good and forms and procedure that should
be avoided in order to keep from litigation.
With regard to correlation of law and accounting, we must
refer in part to what was said about the utility of law to the
accountant. The corporation accountant, in particular,
must constantly refer to legal decisions on the subjects. Many
of the forms which the accountant and auditor uses are deter-
mined by law. The teacher of commercial law should,
therefore, as much as possible, show how legal principles
affect accounting forms and practice.
THE SECONDARY SCHOOL COURSE IN COMMERCIAL LAW
Topics to be Included. — The question of selection of topics
for purposes of the secondary school course is a very vital
one ; first, because the field of commercial law is very large,
and its boundaries not definite ; secondly, because the time
available for the subject is Hmited, and if superficiality is
to be avoided and effective work invited, the teacher will
have to confine his instruction to essential topics. In view
of the embarrassment of riches which the subject offers, the
problem will become, to a large extent, one of exclusion.
This policy we shall have to follow on the principle that it
is better to teach a few topics effectively than a large num-
312 Principles and Methods in Commercial Education
ber superficially. The danger of superficial treatment arises
from the fact that the appeal in that case will be in large part
to the mechanical memory, and rational consideration and
discussion will be almost impossible.
When we look at the content of the ordinary text-book for
secondary schools, and find how much ground it attempts
to cover and how many topics it attempts to crowd in, we
can draw this conclusion, a priori, that the teacher is in-
vited to cram all these facts into the minds of his pupils, with
little regard to reasoning, discussion, drill, and consequent
assimilation. No matter how good the teacher is, and no
matter how well intentioned he may be, the necessity of
covering a good deal of ground prevents him from giving
due attention to methods which will stimulate the pupil's
mind and develop in him an abiding interest in the subject.
Even the professional law school is compelled to Umit the
ground to be covered because of the many ramifications of
the subject, and it is satisfied to give the students the leading
principles of the important subjects together with practice
in their apphcations. To make up for this necessary limita-
tion, outside of providing post-graduate work for those who
intend to specialize in some branch, it shows the student how
to handle a problem in law, and how to trace its solution back
to the authorities.
How, then, shall we limit the field so as to omit nothing
essential and so as to cover the ground in an effective manner
within the allotted time? Let us take it for granted that
certain essential preliminary topics have been covered.
What these are, we shall find later in the discussion of the
first lessons. We must then determine what topics belong-
ing to the field of substantive law are essential in a business
course, and to do so, we must decide upon the principles
Commercial Law 313
which will guide us in our choice. First, of course, we must
choose the branch upon which all other branches lean, and
of which most of them are only special ramifications. This
is the law of contracts. Secondly, we must choose that special
application of contracts which is of the highest importance in
the mercantile world, and which in fact constitutes its essence,
— contracts for the sale of personal property. Thirdly, the
extensive use of credit in modern business necessitates the
study of the law of credit instruments. Hence, we must
include the law of commercial paper. These, then, are the
three essential topics in commercial law which the considera-
tion of utiHty alone, not to mention other reasons, would
determine us in including : contracts, sales of personal prop-
erty, negotiable instruments.
It may be asked why the subject of real property is not
included in our topics of the first Hne of importance. The
reason is, first, that the subject as a whole is very technical ;
secondly, real estate transactions are a special kind of mer-
cantile transaction, and are not comparable, as far as wide-
spread application in business is concerned, to sales of per-
sonal property. It is only fair to require that one who wishes
to speciahze in real estate law because he expects it to be
within the field of his vocational endeavor should take a
special course in the subject.
One phase of real estate law, however, — the law of land-
lord and tenant, — does belong to the essential part of our
course. We may put it among our subjects in the second
hne of importance. Another phase of it, too, is necessarily
connected with the subject of contracts and sales, and that
is the distinction between real and personal property. The
study of the Statute of Frauds as a branch of the law of con-
tracts will bring in, for purposes of illustration, the question
314 Principles and Methods in Commercial Education
of what is real property. The subject of fixtures is connected
with this question, as are other subtopics which belong to
the borderland between real and personal property.
In our subjects of the second Hne of importance we shall
include agency, partnership, bailment and common carrier,
and landlord and tenant. It requires Httle discussion to
justify the inclusion of agency in our course. The complexi-
ties of business make it impossible for the executive to attend
to many of the details of the business personally, and necessi-
tate a delegation of his authority. This leads to many prob-
lems that are unique, in the sense that their solution is not a
special application of the law of contracts. Thus, the whole
subject of " undisclosed principal " is of great practical im-
portance in business, and deserves the special consideration
it receives in the topic of " agency." " Partnership " is very
closely related to agency, and, besides, is of obvious impor-
tance. It is therefore also included.
It may be surprising that " corporations," a subject so
closely related to partnership, is not included even in the
subjects of the second line of importance. The fact is that
the law of corporations has so many technical aspects de-
pendent upon statute law in the different states that it is
hardly suited to satisfactory treatment in the secondary
school course. There are several practical phases connected
with corporations that are of the utmost importance. This
is particularly true in connection with the course on tech-
nique of commerce, in which the subject of the corporation,
as a form of business organization, receives special attention.
Historically, too, the corporation, in the seventeenth and
eighteenth century, was responsible for the settlement and the
industrial development of many parts of the world. And in
the nineteenth and twentieth century the corporation has
Commercial Law 315
been instrumental in carrying out the greatest industrial
enterprises of modern times. With its tremendous resources
and its potentiahties for goods, there have been serious
abuses of power. The discussion of the corporation will
therefore be amply covered in the history of commerce,
economics, and technique of commerce ; and many legal
aspects of corporations may be profitably considered in corre-
lation with the other work. Moreover, corporation account-
ing raises a number of important questions regarding the
status of various kinds of stock, the rights and Habihties of
stockholders and directors, etc., and these topics should be
handled as they arise. To consider them apart from their
applications to accounting, or finance, is to make them ab-
stract, uninteresting, and unprofitable.
" Common carriers," in view of the importance of the
railroad to the business man, deserves special treatment. It
may be more closely connected with economics and civics
by including in it the problem of government regulation.
" Bailments " is so closely connected with " common carriers "
— in fact the latter presupposes the former — that it should
also be included.
In topics of the third line of importance we shall include
insurance, guaranty and surety, and possibly a brief treatment
of corporations.
One who looks over the list of topics recommended, and
compares it with the topics in the ordinary text-book, may
wonder how we have limited the field of study, as we said
we would do, in view of the fact that we have included
practically every topic considered in the ordinary book. In
reply we may say that the division of topics in accordance
with primary, secondary, and tertiary importance implies
emphasis upon thoroughness in the subjects of contracts, sales,
3i6 Principles and Methods in Commercial Education
and commercial paper; a selection of the leading principles
of agency, partnership, landlord and tenant, bailments and
carriers, and a thorough discussion of these ; and a brief
general treatment of corporations, insurance, guaranty and
surety, particularly with reference to their aspects of corre-
lation with business practice. Our most important topics
will therefore be thoroughly discussed, with many illustrative
cases and legal problems; our topics in the second line of
importance will be handled the same way, but their number
will be limited ; while the topics of the third line of impor-
tance will receive a still briefer and less technical treatment.
Preliminary Topics. — In our survey of the essential topics
which made up the substance of commercial law we men-
tioned the law of contracts as the foundation upon which
most of the other topics are based. This might suggest that
we ought to begin our course with the study of the principles
which underhe contracts. Logically this would be the
correct procedure, but pedagogically it would not. It would
be giving the impression to the student that the principles
of law are ready made, and it would not only fail to point
out that law is a matter of growth, which keeps pace with the
requirements of our economic life, but it would neglect to
show the student the machinery by which law is made. Some
accounts of the purpose of law, the distinctions between
public and private law, and some statements of the courts
which enforce it ought to be given to the class : phases of
the subject included in a course on elementary law.
This phase of the subject is presented in all text-books in
commercial law, but unfortunately the attempt to crowd
too much matter in a few pages makes the chapter dealing
with this topic dry and unattractive. There is nothing more
calculated to deaden interest in a subject than a large number
Commercial Law 317
of definitions at the outset of the study. The introductory
lesson in the subject should be more interesting and more
alive than any other lesson, because it so often determines
the right attitude of the mind of the learner.
The teacher must therefore lead up to the subject of com-
mercial law, its meaning, and its problems, by a series of
illustrations which show the way in which disputes and claims
arise. Instead of beginning with a definition of law, let him
begin with practical illustrations of duties of the individual
to the state, as determined by public law, and duties of in-
dividuals to each other, as determined by private law. Now
there are certain duties which individuals voluntarily assume,
but which nevertheless become legal obligations that they
cannot disregard without a penalty. These obligations are
known as contracts. When we speak of freedom of contract,
we mean that a person is perfectly free to enter into any legal
contract he pleases, but once he has made his choice, he is
no longer free, but must abide by the consequences of his
choice. Questions of law arise when parties disagree as to
the extent of their mutual obligations, and then one of the
parties applies to the arbitrator — the court — to decide the
difference in his favor, setting before the court his side of the
case, and supporting his allegations by evidence of facts.
No better view of the need of law can be given to students
than by beginning with the formation of an actual contract in
everyday business, and tracing the conditions which might
arise that would lead to dispute. The important point to
be borne in mind in the presentation is the fact that the
need for law, and the divisions of the law, should be developed
from actual facts, and not presented in an abstract form.
The preceding paragraphs imply that a certain amount of
procedure should be included. But how much of it? Is it
3i8 Principles and Methods in Commercial Education
necessary for the student to learn the steps in the prosecution
of the case from the service of the summons to judgment and
levy of execution? Certainly not, and most decidedly not
at the beginning of the course. It has been pointed out that
the study of commercial law is not intended to enable a busi-
ness man to try his own case. Nevertheless, one phase of
procedure a student must know, for historical and cultural
reasons, and that is how a legal principle is established. This
necessitates a certain mention of our appellate tribunals.
It should be pointed out, by means of concrete examples,
how a dispute in connection with a certain contract, which
involves a certain state of facts, is presented to the courts for
decision and how an appeal to the higher court is taken by
the defeated party. In this appeal the latter challenges the
correctness of the interpretation of the law by the lower court,
and the decision of the higher court lays down a precedent,
which succeeding judges are practically bound to follow, and
which they modify only when circumstances and conditions
in industrial life have so changed as to make the old precedent
inapplicable. This body of precedent, it should be pointed
out, constitutes the common law. The students should be
shown how it is important to have uniform rules which the
judge is bound to respect rather than leave every case to his
discretion. The advantage of the common law in giving
us rules which are both uniform and elastic may be shown,
and the transition to statute law made by concrete examples.
Thus, a certain decision of the courts may lay down a rule
that seems unwise to the people. In that case, they have
the power within limits, through their legislative bodies, to
change the rule. The abrogation of the fellow-servant rule
in negligence cases — a rule that entered in campaigns for
the recall of judicial decisions — is an illustration of how public
Commercial Law 319
opinion led to legislative action after the courts had repeat-
edly refused to change the rule or precedent.
Thus we lead the student to reaHze the relation between
the common law and the statute law, and to note the fact
that the large bulk of our law was worked out in the decisions
by the courts of actual cases which established precedents for
succeeding cases. We show him how statute law has followed
common law, to correct and supplement it, not to displace it.
The lengthy discussion above was necessary, first, in order
to show the teacher how to impress upon the student the way
in which law grows ; secondly, in order to show the teacher
how to lead up to definitions or distinctions such as between
common law and statute law ; and thirdly, to show how the
student is to be introduced to an understanding of the func-
tion of our courts. One more point to be noted carefully
by the teacher is that the definition should be developed by
means of examples, and not stated in dogmatic form. Nor
should the preHminary topics be presented entirely in lecture
form. A certain amount of appeal by means of questions to
the experience of the student will insure his attention and his
participation in the work, and will keep the teacher from
going beyond the student's depth.
To sum up : the preHminary lesson should, by means of
practical examples, bring out the purpose of commercial law,
the function of our courts (without any account of technical
procedure), the function of the appellate courts, the estab-
lishment of a precedent, the change of a precedent, and the
distinction between common and statute law. Other matters
in connection with remedies, such as the distinction between
courts of law and courts of equity, the meaning of such terms
as judgment, execution, etc., had better be explained as the
need arises in connection with later topics.
320 Principles and Methods in Commercial Education
METHODS OF TEACHING
What has been said before will sufficiently bring out the
fact that we do not incline to any lecture method or to such
a use of the text-book as will make the recitation a matter of
memorizing unintelHgible rules. The discussion of the prev-
alent methods in the professional law schools will throw
some light upon methods of teaching in the secondary
schools, and we shall therefore discuss the relative merits
of the text-book and the case methods, in order to draw some
conclusions regarding methods in commercial law.
Text-book Method. — No law school to-day uses the lec-
ture method, because the teacher reahzes that a knowledge
of principles is to be derived only by discussion and applica-
tion of them to numerous cases. The text-book, the basis
of the method used in many law schools, presents a digest of
principles or rules deduced by the author from the decision
of the different courts. References to these decisions accom-
pany the text, and the students are expected to look up many
of these references, in order to see the source of the law in the
particular case from which it was obtained. This method
may be said to be the method of deduction. It presents the
rule ready made, but gives it justification by illustration.
IntelUgent users of this method also give the students abun-
dant practice in the appUcation of the rule to problems, thus
furnishing both the necessary drill and material for the dis-
cussion that is so important in developing the trained legal
mind.
Case Method. — Within the past quarter of a century,
under the stimulus of the example of the late Dean Lang-
dell of Harvard, teachers of law schools have adopted the
Case Method. This is the inductive or development method
Commercial Law 321
applied to the teaching of law. A series of cases in full, con-
taining both the facts and the decision of the court, are pre-
sented to the student. These cases are so graded in their
sequence, as to develop the principles of a particular sub-
ject, like contracts, in a logical sequence. From a perusal
of the case the student draws the particular rule of law that
is established by the decision. In spite of certain disadvan-
tages which will be noted, this method marks a rational
advance in methods of teaching. Its advantages may be
summarized as follows : (i) It is inductive. Instead of
beginning with an abstract principle of law, which has to be
made intelhgible by examples, it leads up to the rule from
a particular state of facts. (2) It gives the student a reah-
zation of the growth and development of legal principles by
confronting him with situations which led to the estabHshment
of these principles. This is due to the inductive sequence
which it follows. In several of the Harvard case books, the
cases are presented in historical order, so that the student
sees the evolution of a particular rule of law. (3) It adds
interest to the study of law by furnishing a common basis
for discussion. The facts and the decision of the case are be-
fore every student, and discussion of various phases of it
is thus facilitated. (4) The case method is in Hne with the
improvement of professional instruction in other fields. This
improvement consists in the combination of laboratory
methods with the theoretic instruction. The introduction
of the university school marked a great advance in the
training of the professional man, who formerly prepared by
a purely empirical method. Thus the candidate in medicine
used to assist the physician, and by the apprentice method
pick up both his theoretic and practical knowledge. The
law student " read law " in the office of a lawyer, where, it
322 Principles and Methods in Commercial Education
is true, he became familiar with the legal procedure, but
where his theoretical training was rather desultory, owing
to self-directed and misdirected effort.
The university school changed this by providing systematic
instruction and preparing the student to apply his knowledge,
after graduation, to the practical requirements of his profes-
sion. The next advance came when it was realized that
theory and practice ought to go hand in hand, and that prac-
tical training in the application of principles should be given
to the student, so as to make him efficient by developing his
judgment and skill. Thus was introduced the clinic in med-
ical instruction and the case in law instruction. In spite
of certain disadvantages, which are not at all insuperable,
the case method has come to stay.
What are these disadvantages? (i) Not enough ground is
covered. There are too many ramifications of a particular
subject, Hke contracts, and unless we make the case book of
a prohibitive size, it is impossible to cover every subdivision
by means of a case. The advocates of the text-book claim the
advantage here, because of their abiHty to cover the ground
completely. In reply to this objection it may be said that
the object of the instruction is not to cram the student full of
law, but to teach him how to reason upon the law, and how
to search for it, when he needs it. The finding of the leading
principles by means of a comparatively small number of cases
is sufficient to accomplish this purpose.
(2) The method is too difficult. The language of the deci-
sion, especially in the older cases, may offer obstacles to
students. This objection is only valid for students of sec-
ondary school age. Professional students should be trained
how to meet difficulties of this sort.
(3) The decision in the case may include several questions
Commercial Law 323
which are not relevant at that particular time to the principle
under investigation. This objection may be met by arranging
the case so as to ehminate phases not germane to the topic.
But even if the case is presented as a whole, the intelhgence of
the student should be trained to make the proper selection.
In conclusion, it must be said that all pedagogic argu-
ments are in favor of the case method, and particularly of a
modification of it, by an improvement on the ordinary case
book. This is the presentation of some of the cases in full,
and the addition of other cases as problems, by the statement
of the facts alone. This gives the necessary supplementary
drill and training in judgment, and stimulates the student's
power of initiative.
Application to Secondary School Teaching. — How, under
conditions as they confront us, can we secure the advantages
of the case method in secondary school teaching? The full
benefits can be obtained only by a method of condensed cases.
Evidently the hmited time devoted to the subject will not
permit a study of complete cases. Moreover, such a study
would be practically impossible, because of the technicaHties
and matters of legal procedure that are so often connected
with the statement of facts and the decision. It is possible,
on the essential topics, such as contracts, sales, and negotiable
instruments, to present a series of condensed cases, in which
the facts could be stated briefly, and the saHent points in
the decision given in the language of the court. In fact, the
authors of this work have such a case book in manuscript. A
recent work on commercial law for secondary schools prom-
ised the presentation of actual cases to the student. When
it was examined, it was found to be something entirely dif-
ferent. The author of the work had summarized the prin-
ciples, and then presented a series of problem cases of a
324 Principles and Methods in Commercial Education
difficult nature, citing the name of the case and the volume
and page where it was to be found. Now there was very Uttle
in the text itself to help the student or the teacher to solve
the problem. The book was another illustration of the faulty
form of the deductive method which thrusts abstract rules
at the students, and expects that this alone will make them
proficient in the appHcation of these rules.
In view of the fact that a desirable case book for second-
ary schools has not yet been pubUshed, we must ask how we
can secure some of the benefits of the case method or the in-
ductive method with the text-books we have.
In order to answer this question, we shall have to consider
the subject of special methods in commercial law.
Special Methods. — Sufficient has been said to show that
the proper way to begin a topic Hke contracts or agency is
not to give a definition. A student ought to be made to
reahze the way in which the topic presented arose out of the
conditions of modern business. The first phase, then, of
every new topic is to show its correlation with business
practice, and to bring out the way in which it serves to satisfy
a certain need. As an illustration, we may take the subject
of Agency. The teacher does not begin with a definition of
agency, but presents the conditions of modern business
under which it is impossible for a person to attend to all the
details of his work himself. The student is made to realize
the necessity under which the business man delegates at
times both matters involving discretion and matters involving
mere routine. This at once suggests the question to whom a
man may delegate his work, what the powers of this agent are,
and what his legal rights and liabiUties are. Thus the way is
opened for an outline of the entire subject in its correlation
with business itself.
Commercial Law 325
The second step is the presentation of the first legal phase
of the particular topic. In the subject of agency, it is neces-
sarily the question how the power of the agent is conferred
upon him, and what conditions may arise which will entitle a
man, by implication, to be considered an agent, even without
express authority. An obvious way to handle this topic is
to give a summary of the various ways in which the power of
agency is conferred, and then ask the student to apply the
principles learned to problems. This is the path of least
resistance, but it is undoubtedly not the best way. A series
of situations should be presented to the student in which the
question of whether a person really has the power to act arises.
Students may be asked to give their reasons, and compare their
answers with the rule of law, which the teacher will state to
them. In many cases the answers will coincide with the actual
law. This is not strange, because in spite of their many tech-
nicalities, legal decisions as a general rule are organized com-
mon sense. If a condensed case book is available, the student
will be able to peruse the problem and its solution and see the
law as it is developed by the court, from a given state of facts.
In such a case, the condensed cases would be assigned prepar-
atory to the discussion in the class. If a text-book is used,
however, the exposition in the text-book should be assigned
as a lesson supplementary to the discussion in the class
room.
The third step is this : the student states underl5dng rules
which have been established by the court, and he discusses
the reasonableness of the rule. A teacher should not hesitate
to allow a student to criticise the judicial decision, where he
seems to think that it is not founded upon good reason. The
danger that students will develop a contempt for the judgment
of the court is negligible. There is nothing that will sharpen
326 Principles and Methods in Commercial Education
their power of discrimination and their respect for the common
law more than the discussion of the reasons which actuated
the judges in their decision. In the vast majority of cases
they will find that the rule is reasonable, and that it works
substantial justice.
As 2i fourth consideration : the rule of law itself is of no value,
except in so far as it is applicable in the solution of actual
problems. The lawyer does not study the principles of law
for their own sake, but because he needs those principles to
meet all the intricate situations that arise, upon which he is
consulted. A person may know all the rules of law and yet
make a poor lawyer because his power of discrimination —
his ability to see that a certain state of facts is to be decided
by a particular rule — has not been developed. He knows
the rule, but he does not know that it fits a given set of cir-
cumstances. This ability can be developed only by constant
practice in the solution of legal problems.
One mistake, however, is commonly made in connection
with this drill. In a subject like negotiable instruments, for
example, writers of elementary text-books will present all the
rules on a given subject, with a few illustrative cases, before
they give any drill problems. This is a serious mistake.
Each lesson should include numerous drill problems. For
example, after the formal requisites of negotiable instruments
have been considered, the student should be given numerous
cases in which the question of whether or not these formal
requisites have been complied with is the point at issue. To
provide material for this purpose, the teacher will have to
present mimeographed problems to the student. To read off
the problems from a book and make the pupils give the solu-
tion is too much of a strain on the attention of most of them.
All the members of the class ought to have the particular
Commercial Law 327
problem before them so as to be able to give a decision, after
a couple of moments' thoughtful consideration of the ques-
tion.
In connection with effective drill, the reader is again advised
to consider the effective results obtained from using Socratic
questioning at this stage of the lesson. To illustrate : the
student reads over the facts of a case, which we might call the
hypothesis (using the analogy of geometry), and he gives the
decision that is applicable to this state of facts. But it may
be that certain distinctions have escaped him in his reading
of the facts, which differentiates this case from the one with
which he is familiar. His answer is therefore wrong. If the
teacher merely corrects him without any comment, he loses
a valuable opportunity to train the student in accuracy of
judgment. He should lead him to discover his own error by
Socratic questions which bring out the fact that the student
has not properly read his question. The lesson which he learns
by this questioning will lead him not to make snap judg-
ments, and to weigh his answer carefully before he gives it.
For 3, fifth consideration another useful exercise in the appli-
cation stage of the lesson is to vary the hypothesis, or the
state of facts, and to let the student realize the change in the
decision which such a change in the hypothesis produces.
Thus, in connection with the subject of Guaranty, assume that
A guarantees orally that he will pay B's debt to C, if B does
not pay. The students see that this guaranty cannot be
enforced, because it is not in writing. The case is then changed
by having A tell C to extend credit to B and he will be re-
sponsible for it. This case calls attention to the fact that A
binds himself primarily to C by his agreement, and as this is
not a guaranty in the real sense of the word, the oral contract
is effective. By thus changing the state of facts in the case,
328 Principles and Methods in Commercial Education
we impress upon the student a better understanding of the
meaning and the appHcation of certain principles.
In the sixth place, concrete methods should be used wher-
ever possible. In all we have said about methods in com-
mercial law we have emphasized the importance of avoiding
an abstract presentation, and of making a student see the
relation between law and actual business. It is this motive
which leads us to include business and legal documents in our
course. Is it necessary for the student to understand legal
forms ? is the question that is often asked. Not such as in-
volve mere legal procedure, such as the summons or complaint.
Nevertheless, every good text-book reproduces in facsimile
such legal forms as contracts, negotiable instruments, powers
of attorney, bills of sale, deeds, etc. The purpose of this
presentation ought to be not so much to teach the student
how to make out these documents himself, as to give him con-
crete illustrations of the applications of the principles. In
some cases, it is true that it would be a valuable exercise for
the student to draw up certain documents, like contracts or
articles of copartnership. The purpose of this exercise
would be to test the student's knowledge of the essentials that
are necessary in such documents. A still more valuable exer-
cise would be the criticism of some of the documents drawn
up by the students, in order, with the aid of the class, to dis-
cover the respects in which these forms are deficient, and in
which they reveal legal flaws. The thing for the teacher to
bear in mind is that it will not be necessary for the student to
use the exact verbiage of formal legal documents. To com-
pel him to do so will be to burden his memory unnecessarily,
and, as a general rule, the hallowed legal phraseology is, in
most cases, unnecessary to the legality of a document.
Another way in which legal forms may be of value is to
Commercial Law 329
give the student the opportunity to fill out blanks that are
furnished to him. Most legal forms may be bought at the
stationer's, so that the task of the lawyer is confined to the
mere filling out of the blanks. Work of this sort may be very
useful to the student in sharpening his knowledge of the
essentials required in certain documents. In this connection,
the teacher may cooperate with the department of typewrit-
ing, so that students may fill out their blanks in typewriting,
using data to suit themselves.
Additional Notes on Method. — i. The Selection of Cases.
We have already said that the teacher should not wait until
he has presented all the principles of a certain subject before
he gives applied problems. And we have also said that the
teacher should have a sufficient number of mimeographed
problems selected from the abundance of material found in
different text-books to present to the student in connection
with the drill work. When a subject like contracts is com-
pleted, then it is appropriate for the teacher to give miscel-
laneous cases on the subject, so as to bring the various subdi-
visions of it in review in the student's mind. There are
certain additional remarks on the selection of the problem
cases and the proper use of them that may be of value to
the teacher.
(a) They should be graded in difficulty. It is unfair to
expect students to wrestle with some of the refined distinc-
tions that have engaged the attention of courts, unless their
minds have been properly prepared for the work by judicious
drill upon easier cases.
(b) On the other hand, the problem cases to be selected are
to be such as to require some points of reflection so as to make
the student feel that the solution represents a definite advance
in his knowledge of law. Evidently leading questions, that is.
330 Principles and Methods in Commercial Education
those which suggest the answer, are to be avoided, as they are
not conducive of reflection.
(c) The teacher should never accept the answer " yes "
or " no " without an intelhgent reason for the answer. Any
other attitude will only be conducive of guesswork. Even if
a student has given a wrong decision, if his answer is based
upon fair reasoning, he should be given at least a passing mark.
It is scarcely necessary to say that such cases are to be pre-
ferred as contain points that lend themselves to discussion,
or to the taking of opposite sides of the question. The great
majority of cases are of this sort. Sometimes, however, there
are cases where all the right is obviously on one side. These
have their place in the course, but they are evidently not so
valuable for training the student in making acute discrimi-
nations as those in which the issues are fairly evenly balanced.
{d) Except in connection with miscellaneous review, cases
presented, as a rule, should not contain more than one diffi-
culty or aspect of the law. A case, for example, may contain
elements of agency, corporation, technical procedure, and
possibly other steps. To give such a case, in connection with
the preparatory subjects of a pupil's work on a particular
topic like agency, is to tend to confuse his mind. The peda-
gogical principle of one difficulty at a time ought to be borne
in mind. In review cases, it may be well frequently to present
cases that may be approached from several angles, and it is a
distinct advantage to be able to do so at times.
{e) It goes without saying that the facts of the problem
cases should be stated clearly and without any omission of
essential facts. Writers of elementary text-books who are
compelled to save space, owing to the necessity of compressing
so many topics in a small volume, frequently state the prob-
lem, and omit essential facts. This is hardly wise, as a rule.
Commercial Law 331
Sometimes it is permissible to present a case in that brief
form so as to compel the student to answer the question by-
supplying hypothetical facts which the author of the problem
has omitted. But such cases should not be given on examina-
tions. To illustrate this point, the teacher may present to
the class a case in which a person has sold orally sixty dollars'
worth of goods to another person, and ask them whether the
contract can be enforced. The statement of facts is incom-
plete because the obvious answer of the student that the sale
cannot be enforced under the Statute of Frauds depends
upon whether the alternatives to a written memorandum,
namely, part payment or delivery and acceptance, were
applied.
(/) An attempt should be made by the teacher not only to
stimulate the judgment and reason of the students, but to
arouse their imagination in connection with the cases. It
may seem strange to say that their imagination should be
appealed to in connection with law, because it may be said that
cold hard facts and reasons are used, not imagination. But
the purpose of stimulating the imagination is not to lead the
students to do any guessing, but to make them see the reality
of the work they are doing, and its relation to everyday business
life. For this reason, the facts in the case should be such as
actually occur in daily life.
Examiners and writers of problems are in the habit of using
A and B as the names of the parties. This may be very con-
venient and safe at times, but it does not tend to make the
case real to the student. As far as possible, the real names of
persons and places should be used. Occasionally it is true
that the use of letters A, B, and C is helpful in the apprehension
of the facts of a case. Thus if three parties are involved in a
negotiable instrument, A as the maker, B as the payee, and
332 Principles and Methods in Commercial Education
C as the indorser, the use of these letters is certainly helpful
in the apprehension of the facts of a case. It might therefore
be advisable not to be too dogmatic in the matter of requiring
real names to be used in all cases. A discussion of the facts
of the case with reference not merely to the legal principles
involved, but with reference to aspects of business procedure
and business ethics, is very valuable. This discussion brings
consciously to the mind of the student, matters of business
ethics, points of attack he should guard against, and methods
he should adopt in order to safeguard his rights. The teacher
should therefore not fail to draw lessons for practical conduct
wherever it is possible to do so, points which not only deal
with business and personal ethics, but points which develop
a right attitude of mind toward our institutions.
2. Reviews and Examinations. — No matter how well a
subject is presented, the review cannot be dispensed with. A
student who has completed his negotiable instruments six
months before may find that many of the details of this tech-
nical branch of commercial law are only faintly in his mind.
It is true that the cases on one topic frequently are interrelated
with phases of another topic. But to rely upon such an acci-
dental review is rather hazardous. It is possible to provide
some form of continuous review throughout the course. For
example, after we have completed sales of personal property,
we give a miscellaneous review of all phases of the subject,
presenting cases not in the order in which the topics were
developed in the text, but in an irregular order. The presen-
tation of the problems in the miscellaneous review in the order
in which the topics occur in the text may suggest to the student
the exact place where he is to find the solution of the difficulty ;
and in a review we want to take away a crutch of this sort.
In addition to the miscellaneous review on sales, a number of
Commercial Law 333
review problems on contracts may be given, thus keeping some
of the distinctive principles of contracts before the students.
In the same way, perhaps, a part of a period once a week
should be devoted to a miscellaneous review on all that a stu-
dent has had on the subject up to the time. This review may
be in the form of a written examination, in the form of an oral
review, or in the form of home work assignment to be brought
in in writing.
The examination is a valuable thing because it trains the
student in quickness of decision and in bringing all the re-
sources at his command to bear upon the solution of the
problem in a limited time. One kind of an examination ques-
tion should be very sparingly used ; that is, the definition.
It is easy to cram definitions, but impossible to cram solutions
to problems. Therefore, if the examination is devoted
exclusively to problem cases, the charge that it encourages
cramming is entirely avoided. Again, some teachers ask the
students for a summary of rules on a certain question. This
is very inadvisable; first, because it encourages cramming,
and secondly, because a knowledge of a set of rules is of
practically no value as such. The important point is that
the student should know how to apply a rule.
Many lawyers would fail in an examination if they were
required to formulate sets of rules. Such a test would be
merely one of memory. Thus, a lawyer might be asked for
exceptions to the liability of common carriers, and fail to an-
swer the question, even though he might be familiar with all
the exceptions, — the reason for his failure being that for the
moment the points do not come to him. But he will not be
phased by a question in which his decision on a given state of
facts is required. We must therefore conclude that the only
fair and practical examination is one in which the student is
334 Principles and Methods in Commercial Education
asked to give decisions and reasons in a set of problem cases.
Occasionally, questions of principles may be required, but they
should not be of such a nature as to require him to enumerate
five or six exceptions to a rule.
3. Research Work. — As we are not training students to
be lawyers, it is scarcely necessary to offer them much of an
opportunity to conduct research work of their own on points
or problems of law. They are so occupied with their various
other duties that time scarcely allows this. There may,
however, be a few exceptional students who take an interest
in this kind of work, and who may contemplate entering the
profession of the law. Such students should be given the
opportunity to learn something about how to get at the
sources of the law, how to use reference books, and how to
discover the law on a certain subject, when one requires it.
In fact, every student should learn how he must proceed, that
is, what sources he must try to get at, in order to discover the
law on a particular point. But the preparation of briefs or
special reports on some topic may be confined to two or three
of the exceptional members of the class. The topic chosen
for investigation should be one on which authorities have dis-
agreed. The elementary text-book frequently makes mention
of the fact that some jurisdictions hold one view and some
another. It would be interesting for some particularly
bright student to investigate the conflicting authorities on
this point, and to summarize the arguments in favor of one
decision and those in favor of the opposite decision. If the
student makes a report of his research to the class, he will
vicariously, so to speak, bring all the members of the class in
touch with the original sources.
4. The Teacher's Library. — The demands upon the good
teacher of commercial law who really carries out his task
Commercial Law 335
well will be very great. It would be beyond the demands of
human reason to expect him to be proficient in all the branches
of a subject. But he should be in a position to have access
to some of the sources of the law, and to be able to use all
those aids by which he may become proficient in the particu-
lar topic which he is presenting to the class. It is not too
much to expect that the teacher has prepared his lesson so
well, that even though he is not a lawyer he knows as much
as a lawyer, for the time being, at least so far as this particu-
lar subject is concerned.
Should the teacher use a key to problems, or is this use of
the key unworthy of his intelligence ? One thing is true, that
he should not use the key in the presence of the class. On
the other hand, it is unreasonable to expect him to have an
absolutely perfect knowledge of all the cases, without the aid
of the key ; and it is undesirable that he should, by using his
unaided judgment, give the class a wrong solution of the prob-
lem. The use of the key is therefore not at all reprehensible.
But of course its use should be confined to the teacher.
As a part of every teacher's equipment there should be a
fair professional library. This should include : first, a series
of standard texts on different phases of the law. By texts
we do not mean elementary books for secondary schools, but
presentations of phases of the law by authorities : such works
as Pollock on Contracts, Huffcut on Agency, Cook on Cor-
porations. The Hornbook Series, published by The West
PubHshing Company, of St. Paul, are a set of authoritative
texts on various subjects, which have the distinction of being
comparatively brief, and of singHng out the essential rules
by means of heavy t}^e.
Second. A series of case books on different subjects, such
as WilHston on Contracts, Ames on Bills and Notes, and
336 Principles and Methods in Commercial Education
other case books, will be found very useful to the teacher,
because he will thus have the opportunity, occasionally, to
read to the students authoritative decisions on certain points
in the language of the court. The students will thus be
brought a little nearer to the sources of the law, and ambi-
tious members of the class will have access to them if they
desire.
Third. If there are funds available, an encyclopaedia of law
would be useful. But as between an encyclopaedia on the one
hand, and case books and text-books on the other, we should
certainly prefer the latter.
Fourth. A collection of secondary schoolbooks will be useful
to the teacher, both for supplementary review cases and for
possible light they might throw upon the best sequence of
the presentation of topics.
Fifth. A collection of the statutes of the state. Thus, in
New York State, the volumes comprising the Consolidated
Laws may prove very useful. There are two subjects on which
there is a tendency to uniformity in the different states in the
Union, — negotiable instruments and sales. The uniform
acts of both these subjects should be a part of the reference
library. If possible, annotated editions of these statutes
should be secured.
Sixth. After all that is said about the importance of a library,
the most important reference library to the teacher is the
advice of some lawyer, who is both able and willing to help
the teacher with advice on some of the difficulties. This
source of aid is particularly important because of the necessity
of adapting the principles of the common law, as presented in
the text-book, to the possible modifications which it has under-
gone in the particular state of the Union in which the school
is situated. The most helpful counsel that a lawyer can give
Commercial Law 337
to a teacher corresponds to the greatest help which the teacher
can give to his pupil, and that is, to show him how to help
himself.
OUTLINE LESSONS IN COMMERCIAL LAW
I. Outline Lesson on the Fourth Section, State of Frauds
Preparation. — (i) Introduction. Common law requires no
contracts to be in writing.
(2) Motivation. Difficulties in proving contracts by means
of witnesses ; danger of perjured testimony and possibilities
of blackmail in certain cases, such as sales of real estate and
promises of dowry in marriage contracts.
Presentation. — (i) Passing of a statute by parliament
requiring certain contracts to be in writing, signed by the
party to be bound, in order to hold him liable.
(2) Significance of term " Statute of Frauds " explained.
(Statute to prevent frauds and perjuries.)
(3) Relation of this act of parliament to our state statutes.
(Brief historical review of the source of our laws.)
Exposition. — (i) Summary of the classes of contracts as
included in the fourth section of the State of Frauds. (Sev-
enteenth section, on sales of personal property, left for another
occasion.) Reason for the inclusion of each class by illus-
tration of the possibilities of fraud and perjury connected
with each.
(2) Illustration of contracts for the purchase of real prop-
erty, contracts not to be performed within one year, and con-
tracts in consideration of marriage. Illustrations to be given
principally by members of class. Wrong illustration to be
corrected by Socratic questioning.
(3) Further analysis of the terms of the statute. Illus-
tration of a written contract between A and B, signed by
338 Principles and Methods in Commercial Education
A alone, held by B. (B can hold A, but A cannot hold B.)
Requirement that contract must be signed by the party to be
bound. Practical application of this requirement. Both
A and B get copies of the contract; A signs B's copy and B
signs A's copy.
(4) Formal statement of the terms of the Statute of Frauds.
Application. — Cases involving Statute of Frauds. Re-
marks on cases to be selected :
(i) Cases involving refined distinctions between real and
personal property are to be avoided. The cases to be pre-
sented are to impress upon the mind the necessity of comply-
ing with the Statute of Frauds.
(2) Cases to be selected are to contain some points that
require a little reflection.
Examples: a. A written contract contains no signatures
or the signature of the party that is suing. Is it valid?
(Question not to be presented in this abstract form. Actual
case is to be presented.) Point of law involved in the case
as well as the solution should be formulated by student himself.
b. A written contract contains the signature of B alone.
Can A sue on it?
(3) Cases to be selected are to contain points that lend
themselves to discussion.
Examples : A contract is not signed at the bottom, but
contains the signature of the parties on top of the instrument.
Does it satisfy the requirements of the statute?
Discussion. — Teacher sums up the discussion and states
the side the courts have taken in their decision. (For other
remarks, see p. 329 seq. Note especially what is said on the
use of the Socratic method, p. 327.)
(4) Cases to be selected, to illustrate that oral contracts
under the Statute of Frauds are voidable, not void. Fact
Commercial Law
339
brought out by the following example : A sues B on an oral
contract for the sale of real property. No defence. Can he
recover? Answer. Yes, if B does not take advantage of
the defence of the Statute of Frauds. Court will not recog-
nize it otherwise. Hence reason for calling contract voidable,
not void.
II. Outline Lesson on the Distinction between Real Property
and Personal Property
Preparation. — Motivation, (i) Importance of distinction.
Student should be made to realize that distinction is not merely
academic, but has real importance. This may be done by
presenting case of an oral contract for sale of certain property
(like fruit trees), and showing how the question of the ability
of interested party to enforce contract depends upon whether
fruit trees are real property or personal property.
(2) Other instances of importance of distinction are men-
tioned to pupils, a. Realty goes to heirs of a decedent
directly, while personalty goes to the executor to be admin-
istered by him, and to be charged with the payment of debts
of decedent, h. A mortgage on a house is foreclosed, and the
house is sold for the benefit of the creditor. Can the furnace
in the house be sold with it ? Can the window shades or the
tools used in connection with repairing the house be sold?
Answer depends upon whether these are realty or personalty.
Presentation. — (i) Case involving contract for the sale
of land on which house is situated. The terms of the contract
do not mention the house. Is the latter included ?
(2) Case involving sale of land on which there are fences,
stone walls, etc.
Generalization. — Land and things attached to the land
(fixtures) are real property.
340 Principles and Methods in Commercial Education
Application. — (i) Cases involving the Statute of Frauds in
connection with the relative claims of executor and heirs, the
foreclosing mortgagee and the mortgagor, and dealing with
things attached to the land.
(2) Cases showing the effect of tenant's placing fixtures on
property. Formulation of rule with regard to tenant's fixtures
and tenant's trade fixtures.
Second Presentation. — Cases involving land sold, on which
crops are growing.
Second Generalization. — Formulation and discussion of rule
with regard to question whether crops are realty or personalty.
Second Application. — (i) Cases involving question of
validity of oral sale of crops, of ownership of crops as between
executor and administrator, etc.
(2) Miscellaneous cases on distinction between real and
personal property involving cases on fixtures, on crops, and
other cases not discussed before, to test power of original
thinking. Illustration : Question whether the following are
real property : Stock in a realty corporation, soil severed from
land, growing trees to be cut down for lumber.
Note. As there are at least two important topics connected with the dis-
tinction between real and personal property — {a) The rules with regard to
personal property attached to the land becoming real property (the doctrine
of fixtures) and {b) the rules with regard to things which are of the land (like
crops), but which are considered as personal property under certain condi-
tions — the rules connected with each one of the topics should be developed
separately. Hence, this lesson contains at least two different lessons, each one
having the steps of presentation, generalization, and application.
SUMMARY
The teaching of commercial law in secondary schools must,
as a general rule, be intrusted to persons who have had no
legal training. A knowledge of the purpose of the study
will be of great help to the teacher in giving him the right
point of view in teaching.
Commercial Law 341
The purpose of the study is (i) to enable the business man
to prevent Htigation by safeguarding his rights at the time
when he enters into his contracts ; (2) to give the student who
will specialize in accountancy the necessary correlated knowl-
edge of law ; (3) to give the student a better knowledge of our
institutions and his duties to the state and other individuals ;
(4) to give him mental discipline, — particularly to train his
judgment ; (5) to throw strong side-lights upon related sub-
jects, like the history of commerce, accounting, and arith-
metic.
In order to organize the study properly, we must limit the
number of topics included in the study, and emphasize some
more than others. Topics of the first line of importance are
contracts, sales, and negotiable instruments ; topics of the
second Hne of importance are agency, partnership, bailment
and common carriers, landlord and tenant ; topics of the
third line of importance are insurance, guaranty and surety,
and corporations.
A few preliminary topics should precede the substantive
study of commercial law, such as the function of the courts,
especially the appellate courts, in relation to commercial law,
the meaning of precedent, how a rule of law is established, how
it is changed, and the distinction between the common law
and statute law.
The general methods of studying law are the text-book
method and the case method. The latter is the method used
in the leading law schools, but in its strict form is not adaptable
to secondary schools, because there is no available case book.
But even with present text-books, some of the benefits of the
inductive or case method can be secured. This leads us to
discuss the following special points in method :
(i) Every new topic should be introduced in correlation
342 Principles and Methods in Commercial Education
with business, and in view of the way in which it satisfies
the needs of commerce.
(2) The principle of law should be presented next.
(3) The cause and the reasonableness of the rule should be
discussed.
(4) The rule should be applied to a large number of cases,
and the Socratic method used in correcting wrong answers.
(5) Documents and legal forms help to make the study
concrete.
In the handling of problem cases the following points should
be observed : They should be graded ; they should present
one difficulty at a time ; the statement of facts should be brief,
without omitting essential points ; and the cases should be
made real, by correlating the facts in them with actual busi-
ness.
There should be a continuous review of preceding topics
by a large number of miscellaneous reviews throughout the
course. The examination in commercial law should not be
on definitions or rules but on cases.
Research work may be given to a limited number of ambi-
tious students, in order to give them a first-hand acquaintance
with the sources of law. As a part of every teacher's equip-
ment there should be a fair professional library, including
standard text-books, case books, secondary schoolbooks, a
collection of statutes of the state, and, if possible, an encyclo-
paedia of law.
EXERCISES
GROUP ONE
1. Tell what means the teacher who has not had a legal education
should adopt, in order to make his teaching of commercial law effective.
2. What is the broadly practical and the narrowly utilitarian purpose
of the study of commercial law ?
Commercial Law 343
3. Why is a knowledge of law essential to the good citizen and to the
man of culture ?
4. What principles would guide you in limiting the field of commercial
law, and how would you determine the relative emphasis to be laid on
different topics ?
5. Give the advantages and the disadvantages of the case-book
method of instruction.
6. How would you proceed to give the student an idea of the im-
portance of "precedent" in law?
7. Illustrate the use of Socratic questioning in correcting wrong
answers in law.
8. To what extent and why would you allow criticism and arguments
on the reasonableness of certain principles as established by judges ?
9. What principles would you bear in mind in selecting and assigning
problem cases to the class ?
10. What use would you make of legal forms and documents ? To
what extent would you let students draw up such forms ?
GROUP TWO
1. What phases of the law of evidence would you give to a class of
pupils who intend to specialize in accountancy ? Why ?
2. If a pupil wants information on a topic like the statute of frauds
in your state, with reference to sales of personal property, how would you
direct him to find the information ?
3. Give an outline of a lesson or a series of lessons on the legal e£fect
of indorsement.
BIBLIOGRAPHY!
Secondary School Text-books
BuRDiCK, F. M., Essentials of Business Law. New York, Appleton &
Co., 1904.
Gano, D. C., Commercial Law. New York, Amer. Book Co., 1904.
Teacher's Hand Book. New York, Amer. Book Co., 1907.
HuFFCUT, E. W., Elements of Business Law. New York, Ginn & Co.,
1905.
Teachers' Manual. New York, Ginn & Co., 1905.
! For references to sources and other references see pp. 335-336.
CHAPTER XII
Economics
function of the course
This subject properly forms the culmination of the entire
business course. Its function is to organize and classify the
student's knowledge of business, in accordance with the fun-
damental principles and laws that operate in it. It is there-
fore designed to give him the proper outlook upon business
policy, by teaching him how to weigh principles and actions
in the light of fundamental laws. For that reason we may call
the subject the philosophy of business. A knowledge of this
is essential to every good citizen, because questions of gov-
ernmental policy are so frequently economic in nature that
the citizen who votes on matters of this sort should have some
means of estimating the arguments pro and con of every ques-
tion, instead of having to depend upon rule of thumb, or
specious arguments of politicians. Moreover, sound eco-
nomic policy in business is dependent upon a knowledge —
which, it is true, some persons who have never studied eco-
nomics possess by intuition — of the fundamental laws of
economics. And no person who has studied it will be attracted
by fraudulent advertisements which promise exceptionally
high returns upon an investment. For the economist realizes
that safety and rate of return are in inverse relation, and when
a certain business proposition offers high returns, he knows
that it requires investigation. If he chooses to invest, he does
so with his eyes open, knowing the risks he must run in doing
344
Economics 345
it. But he is rarely taken in by the mere ghttering prospects
laid before him. The number of illustrations on the value of
the knowledge of economic law may be multiplied indefi-
nitely.
The basis of preparation of the student of economics is a
knowledge of the concrete phases of business, and a descrip-
tion of the forces which operate in business. In such subjects
as commercial geography, for example, the treatment was
more or less descriptive. It is true that the organization of
facts in accordance with causal relationship was insisted upon ;
but the organization of the facts under economic laws was not
taken up except incidentally, because the mind of the student
was hardly mature for this kind of systematization. Before
the study of economic theory can be taken up, the student
must be well grounded in the facts relating to industrial life.
Many economic theories appear half baked, just because those
who formulate them have not taken the trouble to found them
upon a large basis of fact.
In view, therefore, of the large presupposition of experience
on the part of the student, a deductive treatment of the sub-
ject may be justified here more than in any other stage. The
abstract principles will not appear so abstract, because the
minds of the students have been prepared for the work.
Nevertheless, extensive application to concrete facts of busi-
ness should make the abstract principles alive and real.
Therefore, to give the student economic law, without illustrat-
ing its workings in real life, is to give him an empty formula.
There is no objection, however, to beginning the subject in-
ductively, so as to establish the purpose of the subject. Thus,
the basic principle in our economic life is the existence of
desires. Our pupils may be guided to establish the existence
of such psychologic phenomena by a series of questions aris-
346 Principles and Methods in Commercial Education
ing out of the general query, " Why does your father work? "
This exercise might be followed by another in order to estab-
lish the intensity of desires which will be found to be in the
order from necessity to luxury, or, more specifically, from food,
clothing, and shelter, to the desire for pleasure. Another
task which may be assigned in the preliminary stage is a divi-
sion of occupations into extractive, convertive, distributive.
A successful means of accomplishing this end is to arrange the
various occupations with which the pupils are familiar, and
then to group them in accordance with their nature or func-
tion. Though some of this work may have been done in con-
nection with earlier topics, it may be repeated for the sake of
a firm foundation.
Even our writers of modern text-books have recognized the
necessity of a certain inductive presentation of economics
in their text so as to trace its principles in a more satisfactory
sequence. Thus, the psychological school of economists be-
gins the subject with a consideration of consumption — the
satisfaction of certain needs which exist in man. This leads
to a consideration of the means by which man may satisfy
those needs, and brings up the subjects of production and
distribution. This sequence should be followed by the teacher
also.
DIFFICULTIES AND HOW TO MEET THEM
(i) Ground to be covered. In the time assigned to the
subject in secondary schools, it is evidently impossible to do
full justice to all its phases. One difficulty in covering the
ground has been the inadequate basis of experience on the
part of the student. We have tried to meet this difficulty in
our course by providing a special course on the technique of
commerce and industry, in which many of the descriptive
Economics 347
phases can be treated, to the relief of the course in pure eco-
nomics. Thus, it is a burden on this course to be compelled
to consider such details as the concrete workings of the clear-
ing house or the stock exchange. Such descriptive phases
should be treated in the other course, so as to limit our work
here to a very brief review, if necessary, and the consideration
of the philosophy of bank clearings or stock speculation, the
economics of clearing-house certificates in times of panic, etc.
In our commgrcial curriculum we provided that the work on
money and banking should come in the last year contempo-
raneous with the work in economics. This also would relieve
the course in pure economics from the consideration of this
topic, while the work in money and banking could combine
both the descriptive and the philosophic phases of the subject.
Another way in which the difficulty connected with the
ground to be covered may be met is by limiting the number
of topics. As between a full treatment of a few selected topics
and a superficial treatment of the entire field, the first is pref-
erable. In making our selection of topics, we should be guided,
first, by the relation of the subject selected to current issues,
and secondly, by its relation to sound business policy.
(2) The great difficulty which economists have in defining
their fundamental concepts, such as value, capital, etc.,
may be considered by some an argument against introducing
the subject in the secondary schools. But the same argument,
if applied to geometry, would lead us to exclude that subject
also. Mathematicians have been unable to define such terms
as straight fine, angle, axiom, but this does not at all interfere
with our understanding of geometric propositions that are
based upon these concepts. It is true that we cannot define
these terms, but we have a working knowledge of what they
are. Similarly, we may not be able to define our fundamen-
348 Principles and Methods in Commercial Education
tal concepts in economics, but we have a general notion of
what they are.
How much time should the teacher devote to the consid-
eration of some of the abstract terms? Extended study of
the controversy which exists, as to the meaning of such terms
as value, rent, and interest, is hardly desirable. The attempt
to consider the differences of view regarding the definitions
of these terms will lead the student into the metaphysical
field, for which his mind is hardly prepared, and the results
will hardly compensate him for the effort. But where a dif-
ference of view regarding the meaning of certain terms is mate-
rial to the understanding of practical issues, it should receive
due consideration. For example, a proper valuation of the
various definitions of capital will have a material bearing upon
one's attitude toward socialism or similar economic plans.
(3) The laws of economics are by no means so fixed and
eternal as those of natural science. There are many economic
principles, the truth of which is still debatable, and many
theories, urging their claims for acceptance, which are only
countenanced by a small number of men. What stand should
the teacher take on debatable topics, especially where these
topics have become political issues? Thus, what position
should the instructor take with reference to the relative merits
of free trade and protection ? This difficulty is not insurmount-
able if we bear in mind that our attitude should be a judicial
one. The student is entitled to know the arguments on both
sides, and to weigh them for himself. The teacher who takes
a particular stand on a question is apt to be a partisan. The
proper attitude of mind is the judicial one ; and it is to be
assumed particularly toward such doctrines as socialism.
It is not the duty of the teacher either to uphold the doctrine
or to attack it, but to show both its strength and its weakness.
Economics 349
and leave the decision to the student. One thing the teacher
should do, however, and that is to check the student from
drawing rash conclusions and from becoming a narrow partisan.
He should be led to suspend final judgment until such time
as he is mature enough to take a final stand on the matter.
But, it may be objected, how can the student be expected
to arrive at the truth, if economists themselves are not agreed
upon what the truth is? The student of philosophy finds
the same difi&culty. In answer to this objection, it may be
said that whether the student makes up his mind definitely
as to where the truth is, is of far less importance than whether
he realizes the existence of the issue or the problem, and the
necessity of deep study and reflection to arrive at some work-
ing conclusion. The man who realizes that a difficulty exists,
even though he does not know the way out, is ahead of the
one who is not even aware of the existence of the problem.
TOPICS IN ECONOMICS
Though desires for food, shelter, and the satisfaction of
other desires are our ruling motives for economic activity,
production and distribution are more important divisions of
the secondary school economics than consumption. In pro-
duction, the various classes of producers should be treated
of, and it should be understood why certain countries are
leaders in certain lines and why others have been unsuccessful.
The elements which contribute to production should be studied
preferably through the medium of a typical industry, like the
steel industry. A consideration of the United States Steel
Corporation, both in its phases of production and organiza-
tion, will serve as a means of organizing in the students'
minds the principles underlying production.
Distribution is the field wherein most opportunity is afforded
350 Principles and Methods in Commercial Education
for effective treatment with commercial pupils. This division
of economics includes, among other headings, the marketing
of finished products, transportation, and banking. If time
permits, public utilities, government ownership, banking and
currency problems, consular service, and other similar topics
may be discussed.
Under the general head of marketing, it is well to discuss, as
of fundamental importance, '/>/ace and time utility. The study
of EngHsh history should lead the pupils to realize that this
form of utility was not always recognized. Once understood,
the difference in price, due to supply and demand, season of
the year and location, affords no difficulty. Various ways of
selling must also be considered. This involves wholesaling,
jobbing, and retaiHng. It also includes personal selling, selling
by advertising or by salesmen, and the mail-order business.
Importing and exporting, together with the related problem
of warehousing, should also be discussed in this connection.
The railroads and steamships require individual attention.
The establishment of transportation facilities commencing
with the turnpikes has meant so much to the growth of our
country that we are warranted in devoting quite some time
to the topic. Besides the historical side of the subject, the
effect of the public service utility boards and the Interstate
Commerce Commission should be understood. The rate
schedules known as tarifs should be discussed, so that the prin-
ciple of rate making shall not be entirely foreign to our grad-
uates. The tendency in our country toward better service
rather than lower fares or rates might be contrasted with the
tendency which obtains in England and on the continent.
Some light should also be thrown on the relation between the
railroad and the state on the one hand, and the railroad and
the pubHc on the other, so that a clearer vision shall be ob-
Economics 351
tained on questions involving the public ownership of such
public utilities. Time will hardly permit more than a most
casual treatment of the civic and political issues involved, but
it is quite necessary that our pupils have some idea of the ques-
tions they will be expected to express views upon later in life.
The historical development of banking should be briefly
traced so that the evolution involved shall be understood.
The changes from mere safekeeping to investment loans,
from monopoly to free banking, and from local and state to
national banking, are the important points in the historical
sequence. The enlarged functions of bankers offer both in-
teresting and instructive material for study. The methods
employed in establishing a state or national bank should be
understood in general terms, while the present-day distinctions
between state and national banks, and state banks and trust
companies, deserve special attention. Savings banks, while
not important from a commercial standpoint, are neverthe-
less worthy of attention. The United States Treasury and
the Federal Reserve System should also be briefly discussed.
Produce markets, such as cotton, coffee, and produce ex-
changes, also deserve special attention. Spot buying and deal-
ing in futures should be understood. The difference between
gambling and speculation, together with the economic value of
future trading, are both interesting and edifying to the average
student. The great growth of stock exchanges, due to the
spread of the corporate form of organization and the wider
and more general public investment in stocks and bonds, is
sufficient warrant for including the subject in the high school
course.
Questions involving free trade and protection are bound to
arise every once in a while. In order to prepare the high
school pupil for intelligent understanding of the issues involved,
352 Principles and Methods in Commercial Education
we are justified in devoting some time to this subject. Tariff
history will have already been presented in their history courses,
so that all that remains for treatment in the economics room
will deal with the principles involved. Clear notions should
be carried away regarding the fallacy involved in mere wage-
scale differences, in failing to consider the efficiency of the
worker, and the cost of transportation between the source of
production and the market of consumption. The wisdom of
protecting infant industries should be compared with the toll
exacted from the consuming public, which suffers during the
too often prolonged period prior to the maturity, and also with
the policy of doing only such work as we are best suited for.
The argument of the ultraprotectionists who appeal to
patriotism in order to make us a self-sufficient nation should
also be considered. But in presenting arguments we should
avoid the appearance of being dogmatic, except where the
argument is obviously fallacious, and especially where the
consensus of recognized opinion on the subject is practically
unanimous.
Crises and panics are a common phenomenon of our eco-
nomic and industrial life. A tendency toward periodic recur-
rence has been detected, and some theories have been advanced
regarding the " cycles of good times and hard times." Be-
sides devoting some attention to the history of panics in our
country and the cycles referred to, we should present the cur-
rency problem with sufficient fulness to enable the formation
of individual opinions regarding the relation between sound
banking and panics.
We have indicated but a few of the important headings
suggested by a complete course in economics. There are
several other topics which are extremely important, and the
consideration of which must not be shirked, in spite of the
Economics 353
temptation to avoid embarrassing issues. These include
trade-unionism, the regulation of trusts, and socialism. As
was said before, the issues on these subjects should be pre-
sented fairly, and so far as possible without partisan bias.
Certain questions of public finance should also be taken up,
either as a part of the course or in supplementary work in
connection with applied economics.
NOTES ON METHODS OF TEACHING
I. Type Method. — The development of abstract prin-
ciples by means of type illustrations is an important
means of making the principle concrete. As we showed
before, it may be useful to bring out the processes in-
volved in production by taking the United States Steel
Corporation as a type. As an illustration of the estab-
lishment of an abstract economic principle by means of
a typical illustration, let us take the economic law of diminish-
ing returns. The principle may be established by selecting a
square mile of land devoted to potato-growing. It will be
evident that a piece of a given fertility may be made to pro-
duce more than the product which would result from the efiforts
of one man working without any tools whatsoever. But it
is also evident that if we were to hire enough men so as to
place one upon each single square foot that the wages would
exceed the value of the output. Somewhere between one
man and a thousand, let us say, is the proper mean. A prob-
lem may be formulated easily in which, by a comparison be-
tween the value of the product resulting from the employment
of various combinations of men and tools, we discover the most
satisfactory combination. The application may be made
to a factory or other industrial organizations, and similar
tests applied.
354 Principles and Methods in Commercial Education
2. Application of the Historical Method to Economics. —
The orthodox school of economists of the type of John Stuart
Mill made the mistake of discussing the principles of economics
from the standpoint of a particular state of society. They
disregarded the fact that whether a principle is true or not
may depend upon the conditions to which one tries to apply
it. This historical point of view is very important in dis-
criminating between two opposing points of view on a certain
question. Some of the advocates of protection or free trade,
for example, speak of their respective doctrines as if they
represented eternal truths, regardless of circumstances. There
is no absolute or eternal truth, either in the protectionist or the
free-trade policy. The truth of the doctrine depends to a large
extent upon the economic condition of the state of society to
which the policy is to be applied. Even the most rabid free-
trader will admit that the protectionist policy was responsible
for the development of great French and German industries.
But, likewise, the fanatical protectionist will have to concede
that the English cotton industry needs no protection, and
any duty on cotton goods in England would be really a burden
to the consumer.
The historical phases of economics are important, not only
because of their culture aspect and their correlation with indus-
trial history, but because they determine the right attitude
of the mind toward economic questions. The most vehement
advocate of the free coinage of silver recognizes that the issue
is absolutely dead to-day, because of the enormous gold produc-
tion of the past fifteen years. Questions of economic policy
should therefore not be determined from the standpoint of
their absolute truth, but from the standpoint of their truth
relative to conditions as they exist in a particular time and
place.
Economics 355
3. The Use of the Seminar Method. — In the college or
university course, a required part of every student's work
includes research on some special topic in economics, in addi-
tion to the general work of the class. A limited amount of
special investigation is advisable, just as it is advisable in the
history work in secondary school to assign special essays, in
the preparation of which the students obtain some acquaint-
ance with sources and authorities, and some practice in weigh-
ing evidence. Similar motives apply in economics. One
application of this method is the arrangement of debates on
economic questions. Informal debates or discussion in the
class should be resorted to at all times, because they bring
out the freest discussion on the part of the members of the
class. But formal debates, requiring close preparation, are
not so good as special investigations on some particular topic.
The attitude of the debater is one of narrow partisanship.
Anything that tends to challenge his side of the issue he
neglects, and anything that tends to favor his side he is apt
to exaggerate. The special investigation, on the other hand,
compels the student to investigate into the relative merits of
the issue, carefully to weigh the evidence, and to give a judi-
cial decision.
4. Application and Drill. — Sufficient has been said already
to indicate the importance of applying the abstract principles
of economics to the interpretation of current politico-economic
issues and problems of business organization and policy.
S- Use of Graphs. — As in commercial geography, extensive
use should be made of graphs. The text-books give several
applications of the use of the graphs by means of which some
of the abstract laws of economics are elucidated.
In conclusion, it must be said that the purpose of the course
in economics is not to cram a student full of fact or to give
356 Principles and Methods in Commercial Education
him a lot of patent remedies for economic evils, but to stimu-
late him to realize the existence of economic problems, to di-
rect the line of thought he must follow to find the solution
of those problems for himself, and to interest him in pursuing
his reading and study of economic works after he has left
school, and to lead him to weigh public economic questions
in the light of fundamental principles, so as to make him an
intelUgent and broad-minded participant in our democracy.
SYLLABUS IN ECONOMICS ^
I. Consumption. Human wants : their classification ; how
satisfied; why wants increase; how new wants are created
and the significance of this to the business man.
Utilities : kinds of utility, elementary or qualitative, form
utility, place utiHty, time utility, quantitative utihty.
Goods : economic and free, the transition from one to the
other ; the law of diminishing utility ; marginal utility ; pres-
ent goods versus future goods ; the law of demand ; the causes
of increase or decrease in demand; elastic versus inelastic
demand ; stimulation of demand ; the law of variety ; the
function of advertising ; the effects of prosperity and adversity
on demand ; of charges of fashion ; of accident ; the law of
least social cost.
Productive consumption and final consumption : statistics
of consumption ; Engel's Law ; the influence of education
on expenditures.
II. Production. Definition of production : value of motive
force of production ; value as estimate of marginal utility ;
the relation between value and the cost of production of the
marginal producer and the utility of the marginal unit to
^ A full outline, which may have to be somewhat curtailed by schools which
cannot afford suflScient time for a complete treatment.
Economics 357
the marginal consumer. Normal value and market value
under competitive conditions and under monopoly conditions.
Explanations of the formula that monopolies tend to fix prices
at the point of greatest net return. The factors in production.
The products of a country depend upon : {A ) Physical condi-
tions ; {B) (i) Upon the number of laborers and (2) efficiency
of the individual laborer ; (C) Upon the material equipment ;
{D) Upon the organization of the laborers and their adjust-
ment to the physical environment and to the material equip-
ment.
III. Nature. Nature supplies : (a) Land, (b) Water, (c)
Vegetable life, (d) Animal life, (e) Natural materials and
forces.
The law of diminishing returns as applied to agriculture,
mines, fisheries, and building sites.
IV. Labor. The problem of population ; efficiency of in-
dividual laborers depends upon: (A) Health, (B) Physical
strength and endurance, (C) Intelligence, (D) Judgment,
(E) Ambition, (F) Energy, (G) Perseverance, (H) Imagina-
tion, (/) Mechanical ingenuity, (/) Technical knowledge.
The elements determining each of them. The efficiency of
the workers as tested by unit cost. The relative efficiency
of American workmen and those of foreign countries.
V. The Material Equipment — Capital. The definition
of capital; the origin of capital; the chief kinds of capital
goods; the distinction between fijxed and circulating capital
goods, specialized and free capital goods. The advantage of
the capitalistic methods of production ; the law of diminishing
returns in capital; capital funds the result of saving; the
chief ways in which capital funds are converted into capital
goods : (A) Through the investment of one's saving in one's
own business; (B) Through direct borrowing of savings of
358 Principles and Methods in Commercial Education
others; (C) By direct borrowing through banks; produc-
tion conditioned by ability and will to save.
VI. Business Organization. Simple cooperation ; division
of occupation ; complex division of labor within an occupa-
tion ; territorial division of labor ; the economic stages in
the evolution of our complex division of labor.
The chief forms of business organization are: {A) The
single entrepreneur; {B) The partnership; (C) The simple
corporation; {D) The trust or holding company; {E)
Organized society, government ownership.
The advantages of large-scale production; cases where a
large scale of production is not desirable.
VII. The Trust Problem. The trust ; the holding com-
pany of to-day ; the chief objections to the trust, extortionate
prices, the watering of stock, unfair competition ; political
influence ; remedies for each ; the advantage of trusts ; the
Sherman Act.
VIII. Transportation. The various methods of transporta-
tion, by manual power, animal power, water, steam, elec-
tricity ; the theory and practice of rates ; discrimination in
rates and its consequences ; the work of the Interstate Com-
merce Commission and of the Public Service Commission of
the State.
IX. Marketing Goods. The reasons for the exchange of
commodities found in differences of climate, of other environ-
ment, of ability, and of wants. The law of comparative costs
as the basis of exchange. The mechanism of exchange as
weights, measures, etc. ; the historical form of exchange ;
why the fair and weekly market have disappeared ; the ser-
vice rendered by the middleman ; why he is being eliminated.
X. Money. The historic forms of money; definition of
money ; the functions of money ; the value of money ; dis-
Economics
359
cussion of the quantity of money ; the use of index numbers for
determining a general rise or fall in prices ; the single standard ;
the double standard ; the multiple standard ; the advantages
and disadvantages of each ; Gresham's Law ; the issue of
paper money ; reasons for ; effects ; our present money
system.
XI. Credit. Meaning of credit ; benefits and evils of ;
effects on prices ; the chief forms of credit paper ; uses and
forms of each ; speculation ; benefits and evils ; instruments
for speculation; exchanges, brokers; panics and financial
crises ; their causes ; effects.
XII. Banking. The origin of banks; the chief services
rendered by banks ; how banks extend credit ; the nature of
bank deposits ; the bank reserve and its effect ; the work of
the trust company ; of savings banks ; of private banks ; the
functions and working of the clearing house ; the issue of
bank notes ; features of banking in the United States ; the
Federal Reserve System.
XIII. Foreign Trade. Chief imports and exports of the
United States and of the Port of New York ; meaning of a
favorable balance of trade ; how the difference between im-
ports and exports is made up ; the settling of balances ; bills
of exchange ; how the rate is determined ; causes affecting
the rates of exchange; governmental aid to foreign trade
through our system:of ambassadors, consuls, and special agents ;
through mail and ship subsidies ; through commercial treaties ;
through bounties, tariffs, tonnage duties, etc.
XIV. The Tariff Question. The arguments for and against
a protective tariff; the difference between a revenue and a
protective tariff ; reciprocity ; the most favored nation clause ;
the argument for bounties.
XV. Distribution. The problem of distribution; the
360 Principles and Methods in Commercial Education
nature of income ; gross income is replacement fund and
fund available for current consumption (allocation fund) ;
the effect of changes in prices on income; real income and
money income; the shares in the product, rent, wages, in-
terest, profits.
XVI. Rent. Rent; various definitions of rent; Fetter's
conception of rent; the Ricardian theory of rent; the con-
nection between rent and prices; the eflect of changes in
economic conditions in rent; agricultural rent and urban
rent ; house rents and ground rents ; the unearned incre-
ment ; the capitalization of rent ; the taxation of rent.
XVII. Wages. Definition of; money wages versus real
wages; time wages and piece wages; theories of wages,
the iron law; the wage fund, bargain theory, productivity
theories; reconciliation of these theories. The effect on
wages of machinery ; of the agreeableness or disagreeableness
of the work; of the social esteem in which the occupation
is held ; of the chance for promotion ; of international com-
petition ; of irregularity of employment ; of education. The
labor problem a wage problem ; attempts at solution, premium
plans, profit sharing, cooperation.
The work of the labor union, the weakness of the uniform
minimum union wage ; the efifect on wages of the restriction
of output; of the limitation of the hours of labor; of the
limitation of the number of apprentices; the strike, the
lockout, the boycott; the black list; of concihation and
arbitration ; the Canadian system of arbitration ; the labor
legislation of New York State; workingmen's insurance;
Workmen's Compensation Act; the work of the State and
Federal Labor Bureau, women's wages and hours of labor;
the child labor laws ; the wages paid in typical local industries
and the reason for the differences.
Economics 361
XVIII. Interest. Definition of ; why paid ; various the-
ories ; the canonist, the abstinence, the naive productivity ;
the Austrian, the Socialist theory. The rate of interest;
on what it depends ; why the rate varies in different localities
and countries ; the rate on call money ; on commercial paper ;
on long time loans ; gross interest versus net or pure interest ;
causes of the fluctuation in the rate ; the effect of money
laws on the rate ; the money rate as an index of trade condi-
tions.
XIX. Profits. Why profits appear as a distinct share in
distribution ; the analogy of profits and rents ; tendency of
profits to increase or decrease.
Monopolies : Different kinds of monopolies, {A) Personal ;
{B) Legal : (i) Private, (2) Public ; (C) Natural monopolies
of situation ; {D) Natural monopolies of organization ; {E)
Capitalistic monopolies ; {F) Labor monopolies.
The formula of monopoly price " Point of greatest net
return." How each form of monopoly seeks to obtain the
greatest returns. Methods of correcting monopoly profits.
Limitations on power of monopolies to fix prices : {A) Power
of substitution ; {B) Potential competition ; (C) Legal inter-
ference.
XX. State Control of Industry. {A) Through regulation
of prices ; {B) Through regulation of the industry : (i) In-
terstate Commerce Commission, (2) Public Service Commis-
sion, (3) State Department — Banking and Insurance, (4)
Statutes, (5) The courts ; (C) Through regulation of profits ;
{D) Through prohibition of combinations ; (£) Municipal
ownership — the arguments against and for ; (F) Socialism.
Definition of ; danger of confounding with anarchism and
communism ; tabulation of socialistic enterprises in this state
and nation ; the nature of the socialistic society ; its effect
362 Principles and Methods in Commercial Education
on the individual; why socialism grows; its dangers; why
society of necessity grows more socialistic.
ECONOMIC PROBLEMS. An intensive study of at least
two economic problems : {A) The trust problem ; {B) The
money question ; (C) The transportation problems ; {D) The
labor question ; (£) Government ownership.
SUMMARY
Economics, as the philosophy of business, forms the cul-
mination of the entire business course. The basis of prep-
aration for this subject is the knowledge of the descriptive
phases of business derived from the preceding studies.
In view of this knowledge, the deductive method is justi-
fied here, more than in the other subjects. But the inductive
method should influence us in arranging the sequence of topics,
by beginning with human needs and the means of satisfying
them.
The difficulties of the study are due to the ground to be
covered, to the lack of uniformity of definition of fundamental
concepts, and to differences between economists regarding
the validity of certain economic policies. The ways in which
the difficulties may be met are explained in the text. The
leading topics to be taken up in the course are then con-
sidered.
Important points on method are: (i) The development
of abstract principles by means of type illustrations is an
important means of making the principles concrete ; (2) The
historical method should be used, because of its aid in deter-
mining the right attitude of mind toward economic ques-
tions; (3) The seminar method has its use, in connection
with preparation for debates and special investigations or
supplementary topics; (4) Economic principles should be
Economics 363
applied to current questions ; (5) Graphs are a great aid
in economics as well as in commercial geography.
EXERCISES
GROUP ONE
1. Why should economics be offered during the senior year of the high
school course ?
2. Show how the work in local industries, technique of commerce,
commercial geography, and history of commerce may be utilized by the
teacher of economics.
3. Name the most important economic topics to be included in the
high school course. On what do you base your opinion ?
4. What attitude should the teacher take toward questions of con-
troversial economic policy ?
5. Should economics be taught inductively or deductively ? Explain
your answer fully.
6. What is meant by the historical method in economics? Show
how you would apply it in teaching free trade versus protection.
7. Illustrate how the use of the graphic method helps to make the
teaching of economics more real.
8. What place would you assign to extemporaneous and prepared
debates on economic topics ?
GROUP TWO
1. As the head of a commercial high school, what attitude would you
assume toward the discussion of socialism in the economics class room ?
Justify your stand.
2. Prepare an outline on the laissez-faire doctrine, and show how this
model outline may be used as a type for other lessons in the course.
3. Criticise the syllabus appended to the present chapter, and sug-
gest modifications which would make it more suitable for your commun-
ity. Give reasons for any changes you may advocate.
BIBLIOGRAPHY
Brisco, N. a.. Economics of Business. New York, Macmillan Co., 1913.
Ely, R. T., Outline of Economics. New York, Macmillan Co., 191 2.
364^ Principles and Methods in Commercial Education
Plehn, C. C, Introduction to Public Finance. New York, Macmillan
Co., 1913.
Seager, H. R., Introduction to Economics. New York, Holt & Co., 1904.
Sparling, S. E., Introduction to Business Organization. New York,
Macmillan Co., 1906.
Taylor, W. G. L., Exercises in Economics. Lincoln, Univ. Pub. Co.,
1900.
Thurston, H. W., Economics and Industrial History. Chicago, Scott,
Foresman & Co., 1899.
CHAPTER XIII
Business English
aim and scope
This course is sometimes given separately and as an adjunct
to the business department. There is no reason for this,
except in those special schools which have no English depart-
ment, and which have a more narrow aim than the commercial
secondary school. In the ordinary high school, it is inad-
visable to make this separation, because, in the first place, it
would involve a duplication of work, and in the second place,
the subject would be in charge of persons who are not special-
ists in teaching English. The purpose of the course, as we
shall outline it below, is to indicate to the English depart-
ment the topics that are to be included as a part of its course
in order to make it practical ; and secondly, to give an out-
line to such schools as desire to give a specialized course in
the subject.
In this connection, it should be remarked that the teaching
of the clear and idiomatic use of the mother tongue should
not be looked upon as the concern of the English department
alone. Just as this department should correlate its work
with the other departments by choosing forms and topics
that will be of use in the other subjects, so the other depart-
ments should make it a part of their aim to maintain the stand-
ard of good English, both in oral and written expression. This
duty, as we shall see, partly devolves upon such departments
as stenography and typewriting.
365
366 Principles and Methods in Commercial Education
The aim of the course in Business EngHsh is to give the
student the ability to use the English language clearly, accu-
rately, and forcibly, both orally and in writing, in connection
with all the different phases of business activity. The course,
therefore, includes a study of business forms, expressions, and
reports. The double aim that we find in the ordinary course
in English — ability to appreciate literature and ability to
express one's thoughts properly — may be compressed into
one, and the teaching of composition in its application to
business may sum up the aim of the course in Business
English.
The essentials of composition are twofold : first, the pos-
session of ideas to be expressed, and secondly, the knowledge
of the best form in which to express them. It is the function
of the other departments to give the students ideas upon sub-
jects connected with business. While they do this to broaden
the student's mind, by giving him an outline of the activities
and the requirements of business, it is the function of the
English department to see that those ideas acquired in the
other departments will find adequate expression from the
standpoint of form. The English teacher in the commercial
school must, therefore, see to it that the topics he chooses for
composition are such as are within the range of the students'
experience. It is especially advisable to confine all composi-
tion work to the requirements of business and everyday life,
and to omit compositions which deal with mere literary topics.
What are, then, the prerequisites of good composition work
on the formal side? These are correct spelling and a good
vocabulary.
The importance of correct spelling need not be discussed
here, because it is so obvious. Even in a high school, we find
students misspelling ordinary words. Spelling drill is recom-
Business English ;^6'j
mended in the work of this department. The words chosen
should be such as are commonly misspelled. The teacher
will make a collection of these from the papers of the various
students, and devote a few minutes to drilling the class on
these words. The teacher of stenography will do the same
thing with words that are misspelled in the typewriting tran-
scriptions.
The acquisition of a good vocabulary is a matter of practice,
opportunities for which are found in connection with com-
position work. The student's meagre stock of words can
easily be enlarged, especially if the teacher directs the stu-
dent, with the aid of the dictionary, to introduce variety in
his expression. Of course, a method sometimes employed
of giving students lists of words with definitions is entirely
inadequate and almost useless. Only those words are remem-
bered which confront the pupil in the ordinary course of his
work, and which he is therefore compelled to master. There
is danger, to be sure, in encouraging the student to enlarge
his vocabulary by varying expressions which he is using, owing
to the fact that he is apt to get away from simplicity of expres-
sion. But this danger is more fancied than real, and will
be found only in a few isolated cases.
GRAMMAR AND RHETORIC
The motive in studying grammar and rhetoric in our course
is entirely practical. It is not intended to present the sub-
ject in its scientific completeness, but only in so far as the sub-
ject will be of practical use in composition. There are, indeed,
persons who say that grammar is of no practical use in teach-
ing persons how to write correctly, — that imitation is the
great source of correctness. There is an element of truth
in this, but there is also an element of exaggeration in it. It
368 Principles and Methods in Commercial Education
is true that we do not usually write with the aid of rules, but
if we did not know the rules of good usage, how would we
be able to judge of the accuracy of our expression, if we came
face to face with a doubtful construction? The most valu-
able use of grammar, therefore, lies in the fact that it enables
us to criticise and improve our own work. Moreover, sup-
pose the teacher tries to correct a wrong form of expression
by merely telling the student that he is wrong, without giv-
ing him any reason for this fact. What kind of impres-
sion will he make upon the student's mind? If we are to
make teaching rational, we must base our statements upon
a rational foundation, and we do this by means of the study
of grammar and rhetoric. The rules of syntax will concern
us more than other phases of technical grammar. These
rules will be tested and applied in connection with violations
of the rules of agreement, government, and order of words in
the sentence. The memorizing of formal rules and tables
should be avoided.
In connection with the exercises in false syntax, something
must be said about the attitude of some teachers toward this
kind of work. It is said that students ought not to be de-
liberately presented with errors of speech for the mere pur-
pose of correcting mistakes. It is true that the most effective
work of this sort is in connection with exercises taken from
actual mistakes made by the pupils in the course of their
composition work. Nevertheless, practice confined to this
kind of work is not sufficient, and it is necessary to look for
material elsewhere. To confine the exercises to the correc-
tion of disjointed sentences is perhaps bad, too. There is
abundant material in everyday letters and compositions to
supply enough illustrative material for practice. Among
topics that should be emphasized in the course are sequence
Business English 369
of tenses, proper use of the infinitive and partidpi'?, and the
position of adjective and adverbial modifiers in the sentence.
As for rhetoric, it is necessary to make this study more
practical than is usually done. The theoretical discussion
of good usage and the principles of sentence and paragraph
structure is not enough, because such a theoretical discus-
sion is not sufficiently related to the demands of practical
work. Consequently, it has been maintained, and with very
good reason, that the practical study of the sentence and
paragraph should precede the study of words, — a procedure
which reverses that of the ordinary rhetoric, which begins
with words, then takes sentences and paragraphs, and finishes
with the composition. Among the qualities of style, we shall
have to emphasize practically the qualities of clearness, cor-
rectness, and unity. These are the essentials of good style.
Qualities of force and elegance, while important, belong
rather to the luxuries of style, and are more valuable for the
student who is training for authorship than for the student
who is merely training for business life. It must be admitted,
however, that authorship is finding its place even in business.
Some of our enterprising advertising concerns have been
introducing advertising literature of high literary quality —
literature that is almost entitled to the name.
The study of grammar and rhetoric, to sum up, then, will
be conducted entirely in the interests of good writing, and
not as a study for its own sake. We must, therefore, consider
some of the forms which practical training in composition
and language work will take.
FORMS OF COMPOSITION AND LANGUAGE WORK
(A) Transcription. This form may hardly be put under
the heading of composition work. It has its place, however,
370 Principles and Methods in Commercial Education
to a limited extent, in calling the attention of the pupil to
conventional forms of business papers, to arrangements of
the parts of a document, such as the formal parts of a letter,
and to characteristic business phrases. One form of tran-
scription that has its place, however, is copying from rough
draft. The typewritten transcription of stenographic notes
is one form of practice in this line, but even the rapid dicta-
tion of business forms in longhand gives the desired practice
to the student in the proper placing of his copy on the paper.
{B) Language Drill Work as an Aid in Composition. This
drill work may be conducted in connection with the actual
composition lesson or apart from it with materials chosen
personally from the composition work of the student. Some
of the forms for this drill work will take the following shape :
(i) Changing grammatical forms of noun or verb ; for
example, changing the singular into a plural, a present into a
past, and all the other corresponding changes in the sentence
which are made necessary by the change of one form.
(2) Supplying missing words. This is a good drill for
students, especially where two or three alternative expres-
sions are given to him and he must decide which one of the
three fits appropriately in the vacant place in the sentence.
(3) Substituting synonyms and synonymous words for
those used. This is a valuable method for enlarging the stu-
dent's vocabulary. A valuable aid in this direction, one that
authors appreciate very highly, is a book like Roget's The-
saurus, which gives not only synonyms, but related expressions
on the subject.
(4) Condensation. The art of condensation is very im-
portant to the business man, because it means, in many cases,
the saving of money and time. The ability to condense an
important thought into few words, without making it difficult
Business English 371
for the reader to grasp it, is a very valuable one, particularly
to the writer of advertisements. Thus persons who are not
skilled in condensation find it difficult to compress their
thoughts into few words without omitting essential elements,
and even if they are successful in crowding everything into a
brief space, they make the thought obscure. Some of the
more modest forms of condensation upon which the student
can try his skill, as a preparation for the more important work,
are:
a. Combining several simple sentences into compound or
complex sentences, and compressing clauses into phrases or
even into single words.
b. Making abstracts or summaries of paragraphs, chapters,
and stories, and summarizing a thought of a whole story into
one or two sentences. The condensation of a circular into a
small advertisement, or the condensation of a letter into a
single telegram, is the most valuable practical application of
the art of condensation.
(5) Amplification. This art is necessary, as well as the
art of condensation. Its practical value arises in the expan-
sion of a topic into a paragraph and an outline into a composi-
tion. The true art of amplification consists in the ability to
expand the thought in such a way as to make each sentence
bear upon the logical development of the thought, and as to
constitute a connected whole, which has unity. The business
man has occasion to make use of this art when he is compelled
to develop a whole composition out of a few disjointed or
fragmentary hints given to him. The practical use of the
art of amplification is found in the class room in connection
with writing compositions from outlines. Almost every
assignment of a task in composition work is an exercise in
amplification.
372 Principles and Methods in Commercial Education
(C) Reproduction. Composition work may be divided
into two classes : reproduction and invention. The former
is based upon imitation and the latter upon original effort.
In a large sense, the element of originality is found even in
reproduction, just as the element of imitation is found in
invention. By reproduction, we mean the imitation of a
model composition by reproducing it either in substance,
or producing a composition along similar lines. In business,
there are certain standardized forms of expression, — typical
methods of developing certain topics, — that must be mastered
by the student before he can be allowed free scope to exercise
originahty. A student who disregards business forms and
expressions and uses those which suit his taste best, is almost
as bad as the lawyer who tries to disregard precedent. The
study of model business letters, reports, and advertisements
is, therefore, of the highest value. A critical analysis of models
has many values : (i) It gives the student an idea and an
incentive for imitation.
(2) It allows him to see in its complete state the thing which
he is planning to do.
(3) It gives him a knowledge as to the proper order of pro-
cedure in order to develop a certain thought.
(4) It increases his vocabulary by bringing him in contact
with speech that is better and fuller than his own.
(5) It adds to his stock of ideas.
(6) It gives him an acquaintance, that is indispensable,
with conventional formal phrases and usage in business.
There are, of course, certain dangers that are connected
with the use of models ; as, for example, the use of a model that
is beyond the level of the pupil's intelligence or experience.
This fault will be avoided if the composition work is thor-
oughly correlated with the other work of the students. A
Business English 373
second danger in the use of models is in the effect it may have
upon checking the spontaneity of the student's expression.
In the early stages of development, this danger is negligible,
and if care is taken to have the student write upon lines parallel
with the model instead of identical with it, this danger will
be avoided.
In regard to the proper use of the model, it is sometimes
said that it should be introduced only after the student feels
the need for such a model. For example, if the student is
asked to write a composition on a certain topic without
any other aid, and his effort is compared with the model
which is introduced then, an appreciation of the value of the
model will be very much keener than it would be if the model
were introduced at the very start. There is something to be
said in favor of this. The only difficulty is that some stu-
dents will exert no effort whatever, unless they have some
hint of procedure at the very start, and this they get when
the model is presented to them.
(D) Invention. The work in original composition is
built upon the foundation laid by reproduction. In a sense,
there is no such thing as absolutely original effort in composi-
tion, especially in business composition. While the student
will be writing original letters, reports, circulars, and adver-
tisements in connection with the needs of his work, neverthe-
less, he will be making use extensively of phrases and forms
borrowed to a large extent from the models which he has
studied.
Aids in Composition. The Outline. — In the presentation of
topics for composition, the question arises as to the extent to
which the teacher is to aid in the development of the topic.
This leads us to the consideration of the outline. The value
of an outline in any composition consists of the fact that it
374 Principles and Methods in Commercial Education
gives the pupil a plan of his work and thus frees him largely
from the necessity of planning and executing it at the same
time. It is therefore of psychological value, as it gives the
pupil only one thing to do at a time, makes the sequence of
his thought logical, and gives him confidence. The objec-
tions to the use of the outline are that it weakens the power
of originality and sustained thought by guiding pupils along
a certain groove ; that it makes the composition seem stilted
and lacking in spontaneity, and that it checks variety of expres-
sion by making the sentences appear as answers to questions.
These are objections that are all true, if the outline is not
properly used. They may be obviated in the following ways :
(i) The outline may be developed from the model by ques-
tioning the pupils and letting them suggest the sequence of
the topics, or by questioning the pupils without the model,
by asking them what sequence they would naturally expect.
Thus the outline will develop as a result of cooperation of
the teacher and the class ; and it will not check spontaneity
but rather reenforce it.
(2) If the outline is not excessive in detail, and if it is in
the form of headings rather than interrogative sentences,
freedom of expression will be preserved.
(3) Variety of expression can be secured by a preliminary
oral discussion of the topics in the outline, in which different
pupils are asked to give their amplifi.cation of the topic. This
is one of the valuable features of the outline, in that it allows
opportunity for oral composition which in almost all cases
should precede the written composition.
(4) In advanced classes, occasional compositions should be
written without the aid of any formal outline, but even in
these compositions, the pupil should make his own outline
preliminary to writing the composition in detail.
Business English 375
(5) The writing of skeleton compositions by pupils is good
logical training. It is an essential preliminary to the writing
of any long composition. The brief is a good example of
such a skeleton composition.
LETTER- WRITING
This is such an important phase of composition work for
the business student that we give a little more extended
treatment to it.
The formal parts of a letter, and the spacing, spelling, and
punctuation of these formal parts, are of such great importance
that special attention should be given to them. The busi-
ness man is apt to disregard or depreciate any letter of appli-
cation that comes to him, no matter how meritorious, if it
lacks perfect accuracy in those parts. But in teaching pupils
accuracy in the formal parts of a letter, it may be advisable
to give them practice in writing skeleton letters. By these
we mean letters in which the body is left out entirely, but
in which the formal parts are in their correct position. In
the teaching of the business letter the student should be
taught how to analyze the model and use the outline, which
gives the sequence of development of topics. At first the
letters may be analyzed by the teacher in cooperation with
the class ; and afterwards by the class, without the assistance
of the teacher. The aim should be to train the pupils to
know the topics that should be included in a business letter
upon a particular subject, and the sequence in which those
topics should be developed.
In the earlier stages of the course in letter-writing, where
oral composition is a necessary preliminary to the writing of
the letter, the outline forms an ideal basis for oral discussion,
especially so in training the pupils in variety of expression.
376 Principles and Methods in Commercial Education
One pupil will give his form of introduction, another pupil
will vary it, and thus good training in variety of expression
will be furnished; for while there are certain stereotyped
expressions in business letters, there is still enough oppor-
tunity for variety and originality. In the advanced work,
the pupils should make their own outline. It may be advis-
able to let the advanced students make mental outlines of
letters, so as to give them training in writing good letters on
first draft, without the necessity of recasting or rewriting the
whole letter.
The following is an illustration of the kind of outline re-
ferred to in the preceding paragraph, using, as an illustration,
a letter of application for a position.
1. How applicant learned of the vacancy.
2. Qualifications, education, and profession, including age,
experience, place of present and past employment.
3. References as to character and ability.
4. Salary requested and statement as to prospects of
advancement.
5. Applicant's request for an opportunity for a personal
interview.
Classification of Letters and Order in which Letters are to be
Introduced. — The development of the course in letter-writing
should be from the simple to the complex. Those letters
which deal with a single topic should come first. The classi-
fication that follows is, therefore, upon the basis of the order
of introduction of the letter in the course, and is based not
only upon consideration of the development from the easy
to the more difficult, but upon consideration of the needs of
the student.
1. Letter ordering goods.
2. Letter of inquiry.
Business English 377
3. Letter of acknowledgment (receipt).
4. Letter asking for remittance of bill due.
5. Letter of application for a position.
6. Letter of recommendation.
7. Letter of complaint.
8. Letter of introduction.
9. Circular letter making an announcement, or offering
something for sale.
In this connection it must be remembered that the course in
letter-writing may follow an order slightly differing from the
above, a kind of spiral form ; that is, some of the earlier forms of
letters will be written a second time but with more complex
factors in them. For example, a letter asking for a remittance of
a bill may be very simple in its nature, but when it is connected
with the topic of dunning letters, it involves a number of
complex considerations, together with a discussion of business
ethics. It therefore belongs more properly to the advanced
parts of the work. Similarly, the letters of recommendation
may give rise to a series of such letters as, for example, a con-
fidential inquiry as to the character of an applicant on the
part of the new employer, and the reply of the latter. Here
a good question of business ethics and even of law arises.
These questions point to the fact that the course in business
correspondence cannot be isolated from the rest of the busi-
ness course ; that it involves the treatment of business prac-
tice, etiquette, and law ; and that the correlation of the course
in business correspondence with the other topics will make
it more vital and an integral part of the real business course.
WRITING OF REPORTS AND ADVERTISEMENTS
The need for reports, both oral and written, as a necessary
part of business training is perfectly evident. Technical
378 Principles and Methods in Commercial Education
reports in the form of financial statements are, of course,
not connected with the English course, but the clear analysis
and application of a report in language is clearly a matter of
English. Since it is better not to isolate the substance of the
technical report from its language, the matter of clearness of
expression and logical sequence of such a report may be left
to the accounting department. But the study of reports,
of succinct statements of happenings, of the presentation of
needs for the coming year, of the statement of work accom-
plished, of the forecast of future conditions, — most of these
matters in their more elementary forms, — maybe conveniently
taken up in the last year of the secondary school course. The
successful making of a report depends upon the study of good
models. For this reason, the study of trade journals and
trade reports will be of very great help. Model reports on
simple occurrences of facts may be found in the daily papers.
In fact, the newspaper reporter is the specialist in making
reports. The study, therefore, of newspaper articles, the
reproduction of these, and the writing of independent news
reports on items connected with happenings in the school —
this kind of work is a valuable training in the writing of, trade
reports. We saw, in another chapter, the trade journals and
magazines which we consider it advisable for the teacher in
secondary schools to possess. The specialization along defi-
nite lines, however, is out of place in the secondary school,
and must be reserved for the university.
The ability to write advertisements is a valuable accom-
pHshment, because of the necessity which every business
man now and then is confronted with in the way of writing of
routine advertisements. The more elaborate form of adver-
tising has to be left to a special course, because it involves
special training, but the simpler forms of advertisement writing
Business English 379
should be taught to the student in the English course. The
principles of advertising, which are discussed to some extent
in the course on the Technique of Commerce, may be reviewed
in the English course. The writing of illustrated advertise-
ments or cards, so common in our street-cars, is a matter that
is outside of the scope of the English department. The
department of drawing will occupy itself with the artistic
phase of the work, and will also incidentally discuss the de-
scriptive matter that should accompany the illustration, the
most effective condensation of such descriptive matter,
and the most suitable placing of it on the card.
CORRECTION OF COMPOSITION WORK
The leading principle which should govern us in correcting
compositions of students is that mistakes corrected by pupils
themselves are more effectively brought home to them than
if they were corrected by the teacher. Hence, pupils should
be taught how to correct their own compositions, because in
this way a greater exercise of self-activity on their part will
be called for, the critical power of the pupil will be developed,
and habits of care and improvements of standards will result.
Two extremes are to be avoided in the correction of com-
positions.
1. Telling pupils how to correct their own compositions
without giving them any other aid, and
2. Correcting the compositions for them.
Pupils should be given some cue which will suggest to them
where the error is. This may be of various forms :
1. By pointing out the error to them without telling the
correction ;
2. By letting them find their own error by localizing it,
that is, by telling them approximately where it is contained ;
380 Principles and Methods in Commercial Education
3. By asking them questions which will direct them to the
erroneously constructed word or sentence, and which by. com-
parison will lead them to see their own error. If the teacher
himself makes the correction, as in a complicated construc-
tion, the pupil should be asked to give the reason.
In the correction of compositions in the course in Business
English purist standards should, to a certain extent, be kept
in view. The reason for this is that there is a marked increase
of carelessness in usage on the part of the business man.
Students will use a loose construction or an abbreviated sen-
tence, and defend themselves on the ground that they have
seen business men use such a form. The only way to counter-
act such a growing laxity is to insist upon a reasonably rigid
standard. Of course, to create censoriousness has a bad effect
in checking the spontaneity and imagination of the pupils,
but this will follow only if the writing and the criticism of
the work occur in the same lesson. The correction of a
composition should be in a lesson separate from the writing of
it, because then the pupil will not be self-conscious in the
production of his work, and will approach the task of correc-
tion with a fresh mind. If he tries to correct the errors while
his mind is still on the topic which he is writing, many errors
will escape him.
Since it is our purpose to teach pupils how to correct their
own compositions, we must let them do so under proper direc-
tion. The critical power is best aroused if the mind is focused
on one difficulty, hence the advantage of reading the whole
composition for one type of error at a time. For example,
the whole composition will be read,
1. For spelling, capitalization, and punctuation.
2. For simple grammatical mistakes, such as agreement of
subject and predicate.
Business English 381
3. For the larger aspects of construction.
4. For deciding whether pupils have followed up their
outline.
5. For seeing whether the paragraphing is correct.
6. For improving sentence structure by changing from com-
pound to complex sentences, etc.
An additional means of developing critical power is to give
pupils occasional opportunity to correct their neighbors'
compositions, because one sees his own fault in his neighbor
quicker than in himself. Pupils should indicate the supposed
fault of the neighbors in the margin, and a system of proof-
readers' marks should be used for this purpose. Proof-read-
ing is one of the forms of correction which should be culti-
vated. The business man has constant opportunity to read
printers' proofs, and he ought therefore to be trained in methods
of reading proof, and in the proper way of indicating and in-
terpreting proof-readers' marks.
SUMMARY
The course in Business English should be given by the Eng-
lish department, and not by the commercial department.
The aim of the course is to give the student the ability to use
English clearly, accurately, and forcibly, both orally and in
writing ; and the teaching of composition in its application
to business is the central aim of the course.
Correct spelling and a good vocabulary are the formal
prerequisites of composition. Grammar and rhetoric, both
studied practically, are of value because they give the stu-
dent correct standards and because they sharpen his critical
faculties.
Among the forms of composition and language work are :
(a) transcription ; {b) language drill work in changing gram-
382 Principles and Methods in Commercial Education
matical forms, supplying missing words, practical use of
synonyms, condensation and amplification ; (c) reproduction
of model forms ; {d) writing of original compositions. The
model and the outline are valuable aids in composition work.
Uses and limitations of both are mentioned in the text.
Letter-writing is the most practical form of composition work.
The formal parts of the letter should receive special attention.
To obtain the best results, students should analyze model
letters, and make outlines to aid them in writing their own
letters. The development of the course in letter-writing
should be from the simple to the complex.
The writing of ordinary reports and advertisements belongs
to the English course. Technical reports belong more appro-
priately to the department with which they are connected.
The leading principle which should govern us in correction
of compositions is that pupils ought to be taught how to cor-
rect their own work.
EXERCISES
GROUP ONE
1 . Why should Business English be oflfered by the English department
rather than by the commercial department ?
2. How does Business English differ from the ordinary work in Eng-
lish?
3. What is the place of grammar and rhetoric in the English course of
the commercial high school ?
4. Explain the importance of writing reports and summaries as a
part of the training of commercial pupils.
5. What is the function of the outline in composition work ?
6. How should spelling be taught in the commercial high school ?
7. Outline a lesson on answering an advertisement for a position
as bookkeeper and stenographer.
Business English 383
GROUP TWO
1 . Plan a series of lectures on business topics so as to help teachers of
English in a commercial high school.
2. Outline instructions to the English teachers of a business high
school, which will guide them in (a) the emphasis on business topics for
composition work, and (b) the selection of articles having a commercial
value for purposes of making abstracts.
BIBLIOGRAPHY ^
Altmaier, K. L., Commercial Correspondence and Postal Information.
New York, Macmillan Co., 1913.
Belding, a. G., Commercial Correspondence. New York, Amer. Book
Co., 1905.
Chubb, P., Teaching of English. New York, Macmillan Co., 1902.
C0DY,S., Business English — What? Why? How? New York, N. E. A.
Report, 191 1, p. 839.
Effinger-Raymond, F., // / were a Teacher of English. N. E. A.
Report, 1913, p. 621.
Opdycke, J. B., Elements of Composition. New York, Appleton & Co.,
1913-
News, Ads, and Sales. New York, Macmillan Co., 19 14.
Shawcross, W., Manual of Commercial English. London, Pitman &
Sons.
1 References to text-books in grammar, rhetoric, and composition are omitted.
CHAPTER XIV
Stenography and Typewriting
stenography
We should have been inclined to omit the treatment of this
subject in this work, because it is a large subject that deserves
a separate treatise. But as many teachers of commercial
subjects find themselves under the necessity of including the
teaching of stenography as a part of their work, it is advisable
to include a brief account of certain pedagogic phases of this
subject.
Educational Value. (A) Practical Value. — This phase of
the subject was discussed in the first chapter. It will only be
necessary, therefore, to summarize certain points here.
(i) Its utility as a time saver to the executive, who can use
the time thus saved in solving the larger problems that arise
in a business.
(2) Its value as an aid to clerical efficiency by increasing
many times the amount of work turned out.
(3) Its value in preserving accurately, certain records, such
as those of trials, of speeches, and of literary effort.
The power which the subject requires and which the teacher
should cultivate in connection with the teaching of the sub-
ject should also be considered here, because a regard for this
phase of the subject will influence methods of teaching to a great
extent.
(B) Disciplinary. — (i) The development of the power of
concentration. This is a very essential prerequisite for all good
384
Stenography and Typewriting 385
work. Attentiveness and alertness can only be developed by-
eliminating as far as possible all distracting elements in the
early stages of teaching. It is very true that in an office the
dictation which the stenographer receives is given under condi-
tions which are anything but favorable to concentration, but
if the habit of concentration has been formed in the appren-
ticeship period, the power to disregard those distracting
elements will be developed.
(2) Control of the mind over the muscles and responsiveness
of the hand to the command of the brain. This can be de-
veloped only by practice. Accuracy and speed are matters
of habit, and the principles to be observed in habit formation as
they have been discussed in Chapter III will have to be taken
into consideration in such development.
(3) The development of habits of accuracy and neatness,
especially in connection with typewriting, is again a matter of
practice. Any overlooking of faults, failure to " prevent
exceptions," will result in destroying the fruits of previous
training.
(4) The development of the sense of responsibility. The
sense of responsibility cannot be cultivated by mere theorizing
about it or lecturing to the students about it, although a lecture
as a supplement to training is a valuable thing. The oppor-
tunities for training in responsibility exist in every subject
in the curriculum. What special opportunities does this
subject offer in training pupils to a sense of self-reliance?
We find a common complaint in the business world that stenog-
raphers are not properly trained, that they lack initiative, that
their work is merely mechanical. It is possible to arrange the
work in a school in such a way as to give an opportunity for the
exercise of initiative. A course which confines itself to mere
dictation and mechanical reproduction is not sufficient in itself
386 Principles and Methods in Commercial Education
for the purpose of developing self-reliance. There are oppor-
tunities for the teacher to dictate an outline in stenography
and then require the student to transcribe the outUne in narra-
tive form. Another opportunity for initiative is to allow
students to dictate letters of their own composition to other
pupils ; and still another to ask the student to write letters
of their own composition, merely assigning to them the topic
with which the letter is to deal. Thus, it ought not to be neces-
sary in an office for the executive to be compelled to dictate
routine letters to the stenographer. This training, therefore,
is valuable in teaching the pupil how to take care of these
routine matters upon his own initiative, when he enters busi-
ness.
Quickness of judgment to a very high degree is required
of the stenographer. Outlines or abbreviations have to be
taught, that will express a certain idea in the shortest way, and
still be legible ; and this has to be done instantly. This
training is again a matter of habit formation. The more
common difficulties are relegated to the automatism of habit,
and the unusual problems which come up in the course of dic-
tation are therefore taken care of by the mind with very little
difficulty.
(5) Development of imagination and judgment. The
stenographer needs this power particularly in the reading of
shorthand notes. The context must be reproduced from
notes, in which the omission of vowels and the use of con-
tractions leave something to the imagination. Memory can-
not always be relied upon to help in this case. If the ste-
nographer has not sufficient culture, his imagination will have
no scope for activity, and he will be hampered in reproducing
the notes which are outside of the regular business routine.
The deficiency in the preliminary education of a stenographer
Stenography and Typewriting 387
is, of course, beyond the remedy of the special teacher.
The judgment is exercised in the quickness of decision which
the stenographer must make in the writing of outHnes, so that
these are correct applications of principle, well constructed
and legible. In the choosing of phrases best suited to the kind
of dictation, good judgment is also required.
(C) Value in Correlation with Other Subjects. — (i) It helps
a student in his English, because the transcription must be
accurate, both in spelling and grammar. It is the duty of
the shorthand teacher to consider the correction of bad Eng-
lish within his province. No subject teacher has any right to
shift responsibility for mistakes in English upon another de-
partment, and this is particularly true of the teacher in
stenography. Where such teacher finds that the mistakes are
very prevalent, it is his duty to confer with the teacher of
English, to see in what way the fault can be remedied. Occa-
sional spelling drills given by the teacher in stenography will
not take much time and will be very useful. The teacher will,
of course, select words which are commonly used in business.
It may also be well, occasionally, to consider common errors
of speech without regard to the fact that such subjects are
taken up in another department.
(2) As the usual systems of shorthand are phonetic, it
might be thought, theoretically, that phonography would
interfere with the spelling of the pupils. But practical expe-
rience has shown that this is not so. The transcription of the
notes on the typewriter necessitates correct spelling, and there-
fore acts as an antidote to any possibility of phonetic spelling
in longhand. It may be said, incidentally, that phonetic
written spelling of a word, in order to emphasize the phonetic
nature of the usual systems of shorthand, is to be condemned
precisely because it will interfere with the visual impression
388 Principles and Methods in Commercial Education
of the word, and therefore hinder the pupil's correct spelHng.
On the other hand, oral phonetic spelling, in order to emphasize
the fact that silent letters are not written in shorthand, is of
great value, and has none of the disadvantages that written
phonetic longhand spelling has.
(3) Stenography gives the pupil a practical knowledge of
business routine and business forms. The course in office
practice ought to be connected with the department of ste-
nography and typewriting. Since stenography will principally
be used in commercial work, it is, of course, very desirable that
the bulk of dictation shall be in the form of business letters.
On the other hand, there are other forms of stenographic
work which the student will have to perform in business, such
as the filling out of forms, the writing of legal papers, the
making of reports, etc. Practice in this form of dictation
should therefore be given to the student. Correlation of the
dictation work with business routine will have the incidental
advantage that in practising for the sake of technical pro-
ficiency the student will at the same time learn a great deal
about business procedure.
(4) Stenography trains the pupil's ear by emphasizing the
correct pronunciation and the correct accent of words. It
consequently improves his pronunciation. We are apt to
take for granted that the student knows how to pronounce
correctly the words he is going to write, and that he has the
proper conception of sound values. With this idea in view,
we begin our course by plunging right into the intricacies of
technical shorthand. This is a mistake. One or two in-
troductory lessons should be devoted to ear training, and
at the beginning of each lesson, in the early stages of the
work, a little time devoted to a pronunciation drill will be
profitable.
Stenography and Typewriting 389
Aims of the Teacher. — In the narrow or technical sense,
these aims may be briefly stated as follows :
(i) To impart correct principles of the system taught.
(2) To enable the student to apply these in writing short-
hand legibly and rapidly. In giving our illustration in con-
nection with methods, we shall have reference to the Pitmanic
systems. We do so merely for the sake of convenience, and
not because we are pronouncing an opinion on the advantages
of one system over another. However, this point is immaterial,
because the principles of teaching to be discussed are the
same, no matter what the system is.
Teaching Methods. — The general principles which will
govern the teacher in his methods, we must repeat, are the
principles of self-activity and habit formation. Specifically,
we may illustrate some of the points in connection with
correct method, by pointing out some of the faults which are
found in connection with the teaching of stenography.
{A) Faults of Method. — (i) The principles are all taught be-
fore any attempt is made to give dictation. This is a violation
of all sound principles of teaching. It is like trying to make a
mechanic by means of a series of lectures on a trade without
giving him any practice. It is impossible for the student to
digest the principles that are thrown at him in a great heap.
It is all very well to say that the principles of stenography are
clear, but the aim in teaching shorthand is not so much to give
the student an intelligent knowledge of the principles, but to
give him the ability to use them efficiently. This is a matter of
practice. Each rule taught should be drilled upon until a
knowledge of it is second nature with the student. Our best
text-books to-day begin with dictation almost in the very first
lesson. The advantage of this method is twofold. First,
it gives a chance to the pupil to digest the principles by drilHng
390 Principles and Methods in Commercial Education
upon their use ; secondly, it gives him the interest in the sub-
ject by making him reahze that he is writing shorthand at the
very start.
(2) Some teachers who avoid the fault of postponing dicta-
tion to the very end still make the mistake of including too
many rules and exceptions in the same lesson. The correct
principle is that one rule at a time should be presented and
drilled on before another one is given. Thus, it may be well
to present the rule without any exceptions, drill on it, and then
introduce exceptions.
(3) An almost universal fault is that of introducing a prin-
ciple without making the student see the reason of the necessity
for it. This point was mentioned in Chapter III in connection
with purpose or motivation in teaching. The inventor of
shorthand had many reasons for adopting certain devices.
How much more enlightening it is to the student to be put in
the attitude of the mind of the inventor of shorthand, who felt
impelled by certain reasons to adopt a certain device, than to
have the device thrown at him as a mere fiat !
While the method of induction, as we have seen, is not, in
its strict form, applicable to the teaching of shorthand, a
certain modified form of it which embodies the principle of
going from the illustration to the rule has its place in ste-
nography. We may illustrate this by a lesson on the s circle
in the Pitmanic systems.
(a) A number of words containing 5 are dictated ; pupils
write them, using the long s, because they know no other.
{h) Their attention is called to the frequent occurrence of
s in the language. This leads them to consider how much
time could be saved by a shorter form for s.
{c) The students having realized this necessity, the circle
is now introduced by the teacher and some of the outlines
Stenography and Typewriting 391
written before in the long form are written on the board by
the teacher in the shorter form.
(d) The students write these outlines, together with others
of the same kind, from dictation.
(e) The difficulties of using the circle in words beginning
with a vowel followed by an j are shown, and the first excep-
tion to the use of the s circle is therefore noted. At this
point the teacher dictates matter containing words in which
the 5 circle may be used and those in which the 5 circle is not
permissible.
(/) The last step involves the dictation of a connected pas-
sage in which there are not only words embodying the prin-
ciple taught, but words embodying principles previously
studied.
(4) In the dictation of the connected passage, the teacher
is apt to sacrifice good English for the sake of giving many
appUcations of the principle. This is one of the most char-
acteristic faults of the shorthand text. The passages are in
bad and meaningless English. We may state as a general
rule, that passages dictated should always be in good English,
and preferably should deal with business. This advice should
be followed, even though in doing so opportunities for drilling
on the principle are lost. If any extensive drilling is to be
done on the principle, the isolated word should be used as the
medium. Dictation of nonsensical connected passages has
no advantages over dictation of isolated words, and, on the
other hand, involves serious disadvantages of its own.
(5) The dictation of lists of words has its place in connection
with a drill upon a new principle, but it is possible to overdo
work of this sort. The bulk of the class work should be on
dictation of connected matter. Where there are words em-
bodying particular difficulties, they may be discussed in ad-
392 Principles and Methods in Commercial Education
vance of the dictation. Some teachers prefer to discuss the
difficulties in words after the dictation of the passages, but we
beHeve that, for purposes of cultivating speed and self-reliance,
it is more advisable to discuss the hard outlines expected, in
advance, so as to smooth over the difficulties, and to give the
student confidence. It is very easy for one unexpected diffi-
culty to throw the student off the track and make him lose
more than a sentence, and this danger should be avoided.
(6) In connection with principles of habit formation, we saw
that bad habits formed early are hard to eradicate. Any
attempt of the teacher to force the student's speed has a dis-
astrous effect upon legibility. Poorly written, inaccurate, and
illegible outlines result from the attempt of the teacher to
develop speed before the ability to make good and accurate
outHnes has been developed.
(7) In connection with self-activity, we saw how important
the principle of " learn to do by doing "is. A teacher whd
lectures on a shorthand outline, or who lets one pupil write
on the board while the others are merely watching, is not
obtaining the maximum amount of self-activity on the part
of the class. The pupils in the seats should write the outlines
simultaneously with those at the board. It is a useful thing
when dictating to have three or four pupils write their notes
on the board, while the others write theirs at the seat. The
danger that pupils will copy from those at the board is entirely
negligible.
Suggestions on Method. — (i) We saw, in connection with
the correlation of stenography with English, that the student
should be brought to a realization of the phonetic nature of
stenographic writing. We saw also that a preliminary drill
in sound analysis of words should be given. The purpose of
this drill should be to note the absence in the pronunciation
Stenography and Typewriting 393
of the silent letters, and to determine the accent of the words.
It is surprising to find how many pupils there are without any
conception of accent ; or pupils, who, while accenting correctly,
are unaware of the syllable upon which they put the stress.
We may repeat what we said before, that in the early stages
of the subject a pronunciation drill should precede every
lesson.
(2) As dictation of connected matter is so important from
the very start, it is necessary to introduce the most common
word-signs and phrases in the beginning. The old books used
to introduce the contractions and phrases in a mass, and thus
throw an extra burden upon the memory of the student.
The word-signs and phrases should be introduced gradually
as the lessons progress.
(3) An important question which has split teachers of short-
hand into two camps is the question whether any deviation
from the standard outlines, as found in the authorized dic-
tionary, should be allowed. There is something to be said in
favor of each side. In phraseography, for example, there can-
not be any such thing as an accepted form or an unauthorized
form. Each stenographer will have to adapt the principles
of phraseography to the purposes of the particular line of
business which he is reporting. To be able to do so, he will
have to learn on what principles phraseography is based, and
what element in the phrase contributes the main part of the
outline. Writers of shorthand texts should limit the number
of phrases and contractions to those most uniformly employed,
and allow no deviation from these. At the same time they
should teach pupils what principles they are to employ in
building up phrases of their own. The objection, that if
students modify their outlines to suit themselves, other per-
sons will not be able to read their outlines, is of very Uttle
394 Principles and Methods in Commercial Education
importance. There is only one way in which a shorthand
system can be of universal legibility, and that is by the use of a
stenotype. This machine is as yet in an experimental stage,
and it is too early to tell whether it has any advantages over the
ordinary system.
(4) Our text-books in stenography sometimes lay great
stress upon mnemonic devices for remembering positions of
vowels, hooks, etc. These should be used very sparingly.
If the mnemonic sentence makes no sense and is a mere non-
sensical combination of words, it should not be used, because
it will only entail additional effort in remembering the sentence
as well as the key to it. A sentence such as the following,
** That pen is not much good," has its uses as an aid in remem-
bering the position of the vowels, and in thus tiding the pupil
over his initial difficulties.
Common Faults oj Students, and How to correct Them. — The
consideration of the common faults of students will throw light
upon many of the problems of method.
(i) Writing words as they are spelled. The remedy for this
is pronunciation drill as mentioned above.
(2) Writing in wrong position. The remedy is to make the
student pronounce the word aloud and note the accented
vowel. It is useless for the teacher to tell the student that his
position is wrong, without letting him discover his own mis-
take. Thus, if the pupil does not realize that he has picked
out the wrong vowel for his accent, the teacher will call his
attention to the fact by pronouncing the word himself, and
exaggerating the stress upon the accented syllable. In this
way, the worst ear in the world will have its attention called
to the syllable which has the stress.
(3) Writing outlines that are not neat, — too large, for
example. The remedy is insistence upon neatness from the
Stenography and Typewriting 395
very start. It is because the teacher has failed to emphasize
this at the beginning and has allowed exceptions to creep in
that these faults have developed. When this is the case, the
teacher must lead the student towards correcting this fault.
(4) Inability of the student to read his notes. This is due
to forcing the speed of the student, and not giving him an
opportunity to read his notes. The remedy is to let the writing
of shorthand and the reading of notes go hand in hand from the
very start. The reading of engraved shorthand is of impor-
tance in giving the additional drill necessary for the reading of
notes.
(5) The other faults of students are faults which are found
in other subjects as well. They arise from lack of judgment,
from misapplication of principles, which shows itself in the use
of a wrong outline. The remedy depends entirely upon the
nature of the mistake. In general, it may be said that it is
better to lead the student to see his own error by questioning
him, than to tell him his mistake outright. Thus, if the pupil
makes a wrong outline, the teacher should not forthwith
correct it, but call his attention to the wrong form, and by
questioning him, lead him to realize that the form is wrong
and what the correct form is. This method of questioning is
known as Socratic questioning, and is one of the most powerful
means known to the teacher for the correction of mistakes.
TYPEWRITING
In this subject the principles of habit formation are still
more important than in stenography. There are two extremes
to be avoided, however. One is, putting the student at the
machine and letting him work out his own fate. This is
ruinous, because it results in the formation of bad habits.
Teachers reahze that typewriting is a subject to be taught,
396 Principles and Methods in Commercial Education
not merely to be picked up. On the other hand, the opposite
policy of doing all the drill work during the regular class periods
is a great waste of time. After the initial stages in the forma-
tion of good habits have been passed, most of the drill work
should be done after school hours. There are practical diffi-
culties connected with this, because of the fact that students
have no machines on which to practise at home, thus neces-
sitating a large equipment in school, in order to provide a large
proportion of the pupils with individual typewriters to practise
on. Were it not for this fact, it would be advisable to have
typewriting introduced into our course of study at the same
time as stenography.
The time is not very far distant when the typewriting com-
panies will be able to reduce the rental of machines to such
a rate as to enable each pupil to take a machine home, as he
takes a text-book home now.
In connection with the habits which, at the very start, we want
to develop in the student of typewriting, is the habit of taking
care of his machine and keeping it in good order, right posture,
the use of all the fingers, and the habits of accuracy and neat-
ness. Little need be said about the value of every one of these
habits. Some remarks may be of value in connection with
several of the habits. With regard to the use of all the fingers,
the experience of all teachers is that one who becomes ac-
customed to use two or four fingers, for example, will find it
very difficult to break this habit. The result will be a hard
touch and a retardation of speed. It is therefore important,
in connection with posture, to see to it that the pupil has his
hands over the keyboard instead of away from it. The fact
that the system of touch typewriting encourages this proper
touch, is one of the many reasons why it should be adopted in
all schools.
Stenography and Typewriting 397
The habit of accuracy must be developed at the very start,
by rejecting any work that shows any errors, and compelling
the student to rewrite it. The same rule would apply to neat-
ness. Any copy that shows erasures or finger marks or is im-
properly spaced should be rejected. It is true that in prac-
tical business we are not so severe in the matter of erasures.
But it must be remembered that if we want to check the habit
of carelessness, we must prevent its development at its incip-
iency, and this can be accomplished only by rejecting work that
is not reasonably perfect.
Suggestion on Method, (i) Mechanism of the Machine. —
Every student should be taught some facts about the mechan-
ism of the machine, so as to know how to take better care of
it, and how to make emergency repairs, or the adjustments
necessary, when a machine gets slightly out of order. Inabil-
ity of the student to attend to some trifling disarrangement of
the machine results in tying up the work until a mechanic
can be sent for. This causes both inconvenience and loss of
time.
(2) Touch Typewriting. — Reference to touch typewriting
has already been made above. This method was developed
in the education of the blind ; and it soon became evident that
it was generally applicable to all persons. The next step was
the realization that it was not only a method available to all,
but that it was far superior to the other method in speed and
touch. The technical methods in touch typewriting have been
extremely well developed by the manuals on the subject,
and it is unnecessary to discuss them here. One remark,
however, must be made, and that is, if the teacher adopts the
touch system, he should not compromise by allowing the
visible method to be used as well. The first should be used
exclusively.
398 Principles and Methods in Commercial Education
(3) The subject of spacing and forms is of extreme impor-
tance. Consequently, considerable practice should be given to
the student in typewriting legal forms and in filling out blanks.
(4) The stenographer and typist has almost exclusive charge
of the mechanical side of the incoming and outgoing mail.
Filing and indexing — work which was considered in con-
nection with office practice — should therefore be an essential
in this course. In fact, it is difficult to separate the course in
typewriting from that in office practice. Although it is pos-
sible to have office practice without typewriting, it is inadvis-
able to have typewriting without office practice in close
correlation with it.
(5) Duplicating work should also be taught to the student :
not only the making of carbon copies, but also the cutting
of stencils for the mimeograph.
While we have spoken of the necessity of having absolutely
accurate work, yet times will always arise when it is neces-
sary to make corrections and inserts. For this reason the
student should be taught how to attend to such matters.
SUMMARY
The practical educational value of stenography lies in its
utility as a time saver to the executive, as an aid to clerical
efiiciency, and as a means of preserving certain records.
The disciplinary value lies in its development of concentration,
control of the hand, development of habits of accuracy and
neatness, development of the sense of responsibility, develop-
ment of the imagination and the judgment.
'; The educational value of stenography in correlation with
other subjects lies in its aid to correct English, in giving pupils
correct values of English sounds and improving their pronun-
ciation, and in giving them valuable office practice.
Stenography and Typewriting 399
Faults to be avoided in teaching stenography are :
(i) The teaching of all the principles before any attempt is
made to give dictation. (2) Including too many rules and
exceptions in the same lesson. (3) Introducing a principle
without making the student see the reason for it. (In this
connection the sequence of steps in a lesson is given.) (4)
Sacrificing good English for the sake of giving many applica-
tions of principle. (5) Dictating words instead of passages.
(6) Forcing speed at the expense of accuracy. (7) Failure
to give sufficient practice to all students. Methods of over-
coming the faults are indicated.
Other suggestions on method are : The giving of frequent
pronunciation drill ; the introduction of common word-signs
and phrases in the beginning, so as to make dictation possible
at the very start ; the teaching of the general principles of
phrase construction ; and the sparing use of mnemonic devices.
Common faults of students are : Writing words as they
are spelled ; writing in wrong position ; lack of neatness ;
inabiUty to read their notes ; the misapplication of principle.
The remedies are indicated in connection with each fault.
The principles of habit formation are of still greater applica-
tion in typewriting than in stenography. The development
of good posture, neatness of work, proper technique, and habit
of accuracy are extremely important. The use of touch
typewriting is recommended. Among the phases of work
that the student must get in this course are proper spacing
and technical forms, carbon work, stencil and mimeograph
work, addressing, filing, and indexing.
400 Principles and Methods in Commercial Education
EXERCISES
GROUP ONE
1. What is the practical value of stenography and typewriting ?
2. Briefly explain the disciplinary value of stenography.
3. Define the place of stenography in the commercial programme.
4. Should the school limit itself to a single system of shorthand ?
Discuss pro and con.
5. State the advantages of the touch system of typewriting compared
with other systems.
6. Should the teacher of stenography insist upon an absolute ad-
herence to the dictionary outline, or should he encourage rational devia-
tion therefrom ?
GROUP TWO
1. As the principal of a newly organized commercial high school,
how would you decide :
(o) Upon the system of stenography to introduce ?
(Jb) Upon the kind of typewriting machines to purchase ?
2. Plan a system of practical training for your pupils of stenography
and typewriting, utilizing the facilities afforded by the school alone.
3. Outline a model lesson in stenography, suitable as a type to be
followed by yovmg teachers.
BIBLIOGRAPHY 1
Bock, W. F., The Psychology of Skill. Missoula, Univ. of Montana,
1908.
Brown, D. W., Factors of Shorthand Speed. New York, Shorthand
Pub. Bur., 1897.
Clark, G. A., Shorthand — Its Educational and Practical Value. N.E.A.
Report, 191 1, p. 845.
Fritz and Eldridge, Expert Typewriting. New York, Amer. Book Co.,
1912.
MoRAN, S. A., Teaching Shorthand. N.E.A. Report, 1908, p. 881.
^ References to text-books in stenography are not included.
PART THREE
SPECIAL PROBLEMS IN COMMERCIAL
EDUCATION
CHAPTER XV
The Preparation and Equipment of the Commercial
Teacher
the situation
Commercial education, especially in the higher forms, has
made wonderful advances during the past decade. All the
signs of the time point to even greater forward strides. In
order to meet the demand for this kind of instruction, it is
essential that there be supplied a sufficiently large number of
well-trained teachers. The fact that universities throughout
the land have begun to respond to the call augurs well for the
friends of higher commercial education in the United States.
Though the curricula of our schools do not as yet attain to the
position of those of France, Germany, and other European
countries, a good beginning has been laid, so that it is reason-
able to expect that ere long not much more will be left to hope
for.
This preliminary introduction will serve as an approach to
the topic of this chapter. Not many years ago, the problem
of what was a proper training for the commercial teacher
did not concern many educators or business men. Within
the memory of most of us there was a time when it was a
2 D 401
402 Principles and Methods in Commercial Education
matter of indifference whether the teacher of business subjects
had the training afforded by institutions of high school grade,
or not. His technical training consisted of a knowledge of
bookkeeping, in scope no broader than that which nowadays
is presented during the first year's high school work in the
subject ; a study of commercial arithmetic which emphasized
foreign exchange and " short cuts " ; and his education was
rounded out with an ability, often painfully acquired, to swing
a pen artistically. Some few added to their accomplishments
a knowledge of stenography.
If the training which has thus been so briefly outlined suf-
ficed for the teacher of a past decade, such is no longer the
case. What preliminary education is expected of the man or
woman who expects to enter the ranks ? An intelligent answer
requires a survey of the domain presided over by the com-
mercial teacher.
The most superficial acquaintance with modern business
education would suffice to indicate that a much broader
knowledge is required at present than formerly. But this
surface indication is not sufficiently exact for our purposes.
So though our investigation demands a more scientific basis,
the difficulty which apparently looms up is not as real as might
be imagined, inasmuch as an insight into the curriculum of the
commercial high school has been gained by a study of the
subject-matter contained in the second chapter. It is our
purpose now, in the light of what is expected of the student,
to ascertain how the teacher may be best fitted successfully
to accomplish the work he is called upon to perform.
Lest we take too narrow a view of our subject, it is well that
we do not hasten to survey the field from its purely technical
side alone. Too long, indeed, was it deemed sufficient that
the student preparing for the teaching of business subjects
Preparation and Equipment of the Commercial Teacher 403
should acquire some familiarity with what might be termed
" the three R's " of commerce — reckoning, 'riting, and
recording. Without continuing this topic in the present con-
nection, we wish to point out that our problem, in its entirety,
must consider the fundamental training of the teacher in
general, and then discuss what special training should be
added by the person wishing to specialize in commercial work.
It is our purpose first to discuss the education of this teacher
without direct reference to any specific field of pedagogic
activity, as the books on education, whose number is legion,
spare us the need of developing this topic in too great detail.
It is no longer held that the teacher is born ; all concede that
he may be made. Psychology, pedagogy, and the science of
class management have amply justified the contention of their
friends regarding their efhcacy to improve the raw material of
normal classes, so as to produce good teachers for our schools.
We know, then, that instruction aiming to develop teaching
ability is practical and feasible. But instruction in how to
teach — so most educators agree — should only be offered to
those who have previously acquired the culture afforded by
institutions of higher learning. No advanced community
any longer sanctions less than a high school education as
a prerequisite for the teaching profession ; the tendency is
toward an insistence upon a college education for persons
who intend to teach in secondary schools. The members
of a high school faculty should not have less than a college
training, though for practical purposes it may be, and often is,
necessary to lower the bars in order to secure instructors in
certain technical subjects.
404 Principles and Methods in Commercial Education
COLLEGE TRAINING
The question arises, Should the commercial teacher have an
academic degree ? And if so, what subjects should he choose
during his college course ? It is our firm conviction that the
college graduate, as a general rule, makes a better pedagogue
than the person who has not received the benefits of a so-called
liberal education. Just why this should be so is not easy to
state. It hardly suffices to assert that our experience justified
the statement. Especially is this so in the light of what a very
popular college president, in a recent address, defined culture
to be, — that which was left to a college graduate after he had
forgotten all that he had learned at his alma mater. Though
this definition must not be accepted literally, it will serve
our purposes for a moment. If, then, it is not the subjects of
instruction in themselves which are of prime value, what is it
that causes us to advocate a college education for all those who
wish to enter the professional fold ?
Probably the most important contributions of a college
education are the powers of attacking a problem and the
broader point of view. The ability to size up a situation or to
solve the problems which confront us, though often the result
of what has been called a " natural gift," is, by most of us,
acquired only as a result of education and training. The
liberal-minded man is most often the product of the college.
And even in the realm of business it is easy to read the sign
of the times which points unerringly to the need of higher
commercial education. This spirit of the times demands of
the man of affairs, as it has long of the minister, physician,
and lawyer, a liberal college education, so as better to fit him
to wrestle with the material things of this world.
We might be somewhat diffident about so strongly advocat-
Preparation and Equipment of the Commercial Teacher 405
ing that the prospective teacher devote three or four years of
his hfe to further schooHng were it not for the change in the
colleges and universities which is often associated with the
name of President Charles W. Eliot. The elective system,
combined with the fact that economics has been so liberalized
as to include courses in business administration, trade
policies, advertising, railway rate making, factory efficiency,
and other strictly practical commercial subjects, has re-
moved the last argument of the so-called self-made man to
the effect that the only way to learn a thing is to do it. Busi-
ness men have come to realize that a proper combination of
theory and practice spells greater efhciency than was possible
under the apprenticeship system which prevailed until quite
recently.
Now that educators have come to realize that no single
subject of instruction enjoys a monopoly of mental discipline,
and that the training value of a topic depends not so much
upon itself as on the manner in which it is presented and its
relationship to life work, a wonderful change has come upon
the pohcy pursued by study-programme builders. No longer
is it felt that the classics, mathematics, and moral philosophy
should occupy the major part of the students' time ; practical
subjects, which in themselves are as much an intellectual
discipline as was ever true of the older studies, and at the same
time prepare for the life outside of the college campus, have
come to be regarded as suitable diet for the student. It is
because of this change in the college and university curricula,
that we feel it so strongly incumbent upon us to advise the
reader to seize the opportunity, if presented, to come within
the influence of an institution which is dominated by modern
educational ideals.
4o6 Principles and Methods in Commercial Education
EXTENSION COURSES
But we realize that many of those to whom these pages will
come have either no chance to attend a college, or else are
now teaching, and cannot very well begin their preparation
anew. To them, it is the Gospel of Hope, not of Despair,
we wish to preach. Traditions have been shattered in this
twentieth century of ours; all good roads lead to success.
Our institutions of learning, catering to the needs of those who
cannot devote all of their time to instruction, have begun to
offer evening courses and summer school work, which practi-
cally parallel the regular day sessions. Yet even for those
who cannot attend upon this work, the door of hope is not
closed. Reliable correspondence schools have made available
to the ambitious student much of that which formerly was for
the elect alone.
Regular day session work is probably most fruitful of results.
This is true for a number of reasons, of which the most impor-
tant are that most students who attend these classes have
greater leisure than the other groups, and that they pursue
their studies at a period during the day when their minds are
freshest. Class instruction, whether in winter or summer or
during the day or evening, is more desirable than correspond-
ence instruction because of the emulation which is excited by
the daily recitation. But correspondence schooling, when
properly and conscientiously conducted, is, to the properly
qualified ambitious worker, hardly less beneficial than any
other kind. On this point, the remarks of the late President
Harper of the University of Chicago are very apropos :
"I have myself been personally interested in correspondence work for
twenty years, and I have seen the system worked for that period of time.
In some respects there is opportunity for better work in correspondence
Preparation and Equipment of the Commercial Teacher 407
study than in ordinary class-room recitation. Each student in a cor-
respondence course has to recite on all the lessons, while in many a class
room the student recites on only about one-thirtieth of the work of a
three months' course. It is safe to say that the standard of work done
in correspondence courses is fully equal to that of the work done in the
larger classes. Indeed, I may say that there is a larger proportion of high-
grade work done by correspondence than in class recitation. People
who take work by correspondence do it because they want to get some-
thing out of it, while in many courses in colleges, the students take the
work merely because it is required in the curriculum."
A word of explanation is necessary regarding our attitude
toward instruction by correspondence. We have met many
persons who are discouraged because they have not had, or
do not have, an opportunity to improve themselves by means
of college or university work. We have just tried to show
that for the truly ambitious opportunity knocks more than
once — in fact, it keeps on knocking all the time. The in-
vitation is for all the old and young, the beginner and the
experienced teacher, man and woman, native and foreigner.
It is true that correspondence instruction in practical sub-
jects is of value only where the student has opportunity to
apply his theories to practical experience either in the labora-
tory, the shop, or the business. But then many of the stu-
dents who take correspondence work, do so in order to help
them organize their practical experience, in order to give them
a broader outlook upon their work and a consequent oppor-
tunity to advance themselves in it. The instruction fulfils
its purpose as far as those students are concerned. Corre-
spondence work in business subjects is therefore valuable to
learners, because the large majority of them are engaged in
business, and have the opportunity, by practical use, to test
what they have learned.
But we cannot leave the discussion without a parting word,
4o8 Principles and Methods in Commercial Education
or else we may be misunderstood. Despite our approval of
correspondence instruction, we must regard it as a substitute,
not as an alternative, of regular university work. Every one
who has time and means to pursue regular university courses
should by all means do so. The dividends are bound to be
ample and satisfactory.
SPECIALIZATION
Now that we are agreed that a college education is a desir-
able preliminary for the work of the teacher because, aside
from all other benefits, it actually prepares him for his life
work, another question remains. What special training will
best fit the commercial teacher for his professional duties?
It has already been seen that an examination of the high school
curriculum, with which a study of Chapter II acquainted
us, would probably furnish a reliable index.
In thus speaking of the curriculum in Chapter II, we must
guard against falling into a natural error. We are not justi-
fied in jumping to the conclusion that a high school student
who has pursued the work outlined for a commercial course is
by virtue of such training best fitted for the task of teaching.
Nor would such a person be much better able to cope with
the problems of the schoolmaster, were he to add a normal
course to his high school education. For it is to be remem-
bered that whereas a good student of a certain subject may
prove a successful coach for a less able classmate, it is quite
a different task to formally present a topic to a class. The
best preparation for the successful presentation is a thorough
knowledge of subject-matter, and such an understanding can
only be acquired by pursuing one's studies beyond the rela-
tively narrow confines of the academy.
When dealing with the training of the commercial teacher,
Preparation and Equipment oj the Commercial Teacher 409
we are treating of an instructor who must supplement what-
ever knowledge he has acquired at school or college, by actual
experience gained in the real world of business. Thus, the
person who essays to teach bookkeeping should have kept
books, — the person who discusses railway rate making
should, if possible, have helped to establish a tariff. But this
is an ideal state which though aimed at is quite beyond at-
tainment. Fortunately, any business experience so changes
the academic attitude, that a healthy reaction to unpractical
theory results from such contact, and it is found that the
student body is much more impressed by the man who comes
from business than with the profound cloister philosopher
who theorizes on what real banking or real importing are, or
ought to be.
The conclusion often drawn from such statements as those
contained in the foregoing paragraph, serves to emphasize
the need of a training in logic for many persons. Though
business experience enriches academic instruction, it by no
means follows that the man of business, — solely because of
his experience, and without the acquirements which would
be his were he to have pursued courses in business subjects, —
makes the ideal teacher of commercial students. Every one
familiar with school administration can present examples of
brilliant artists who cannot teach the rudiments of drawing,
of skilled mechanics who fail to succeed as instructors in man-
ual training, of successful practical men who are all at sea in
the changed environment of the class room.
We are now prepared to accept the conclusion that the
training of the teacher is a much more complex process than
at first sight appeared to be the case, while the situation is
more complicated still when we deal with the teacher as a
speciaHst. Soon we shall see that the analysis in so far as it
4IO Principles and Methods in Commercial Education
applies to the teacher of commercial branches offers greater
diflSculty than might be expected even in light of what ob-
stacles were anticipated, because he is called upon to present
such a variety of more or less unrelated groups of subjects.
Still, before we proceed with the final division of this section,
it is well to summarize our conclusion thus far. The ambi-
tious student who aims at success as a teacher of business
subjects should strive to acquire a college education which
should include or be supplemented by courses in pedagogic
and commercial subjects, and he should endeavor to secure
some actual experience at keeping books, or as a real worker
in some business, so as to secure an insight into affairs which
in school, no matter how well it carries out the ideals of busi-
ness education, he can ever hope fully to accomplish.
The time has now come to ascertain what special topics the
reader should be prepared to handle. Necessarily the re-
quirements will vary with different situations, but for our
purposes we shall employ the model curriculum arranged for
the commercial high school and shown in an early chapter.
Obviously, the subjects included under science, languages,
mathematics, and other such general groups, are not properly
included as business topics, though necessarily included in
the curriculum for purposes which have been made clear
elsewhere. An ability to teach other subjects than those
primarily his own will enhance the value of the instructor
to any institute, but as a man or woman is usually engaged
because of his or her ability as a specialist, we shall devote
our attention solely to those which constitute commercial or
business subjects. In passing, however, it may be said that
the person who has had the benefits of a liberal education,
and who understands methodology, can, in an emergency,
handle with reasonable success almost any subject the prin-
Preparation and Equipment of the Commercial Teacher 411
ciples of which have been definitely formulated in a text-
book.
The first group of subjects in the curriculum may be styled
the technical group. Of the subjects in this group, accounting
is the most important. Besides bookkeeping, it includes
penmanship, commercial arithmetic, business forms, and busi-
ness practice. The second group may be termed economics
or the science of commerce. It consists of commercial geog-
raphy, the history of commerce, and economics. To these
subjects may be added commercial law.
One who wishes to qualify to teach stenography must
become proficient not only in subject-matter and methods of
teaching, but must obtain thorough training in English com-
position and rhetoric, in business practice and usages, and in
office systems and routine. Subjects of the economics group
and commercial law should form a part of the teacher's train-
ing, although they are hardly necessary as a part of the quali-
fying examination for the position as teacher of stenography.
The question may arise whether a teacher of the subject should
be required to take a speed test, or whether it is sufficient for
him merely to be thoroughly acquainted with the principles
of the shorthand system. Our answer is that the teacher who
wishes to drill students in speed must understand the prac-
tical problems that have to be overcome in the attainment of
it. He can hardly be familiar with these if he has never con-
quered them himself. Besides, the schools are entitled to
the services of experts in their craft. Too often has the
charge been made that persons who are unfit to obtain a good
position in the business world take to teaching commercial
subjects.
Another prerequisite of all business teachers is penmanship.
Good penmanship was long deemed a gift. Various systems
412 Principles and Methods in Commercial Education
of full or modified muscular movement writing have demon-
strated the fact that every one can easily and quickly secure
the ability to execute fairly desirable copy. The prospective
teacher must realize that it is almost, if not absolutely, im-
possible to secure a position unless the applicant is able to
show himself a master of what is sometimes known as a good
business hand.
This discussion would not be complete were we to neglect
to indicate how a knowledge requisite for the task of the per-
son undertaking to teach the subjects just indicated may
be secured. Students in high schools or colleges which do not
offer instruction in this work can secure it by attending summer
sessions, or by correspondence work. To be able to do book-
keeping properly, however, the prospective teacher must also
study accounting, and, as was shown earlier, he must also
secure some business experience. Every one must decide for
himself how to do this ; some may decide to do so in some of
the ways already pointed out, or else by devoting another
year or two to the period of preparation. He may supplement
his business experience, if this is meagre, by observation work
in business houses. The time is coming when every school
board will permit teachers of commercial work to absent
themselves, for a short time every year, for the purpose
of studying concretely the ways in which business is con-
ducted.
In conclusion, we must consider the complaint that the
prospective financial rewards of teaching commercial branches
hardly justify an elaborate period of preparation. It is true
that the salaries paid are, as a rule, inadequate, but not to
those who are in a position to command a salary proportional
to their worth ; and they are persons that have had a broad
training. Not until the standard of preparation of the com-
Preparation and Equipment of the Commercial Teacher 413
mercial teacher is at least as high as that of the academic
teacher will his standing equal and his salary surpass that of
the other. In order to expect the community to value his
services properly, the commercial teacher must impress it
with his worth by an adequate preparation and special equip-
ment for his profession.
SUMMARY
The success of commercial education in the secondary and
high schools depends upon a supply of well-trained teachers.
The old-time teacher of business subjects had little more than
a knowledge of elementary bookkeeping and arithmetic, a
smattering of stenography, and the abihty to write artisti-
cally.
The well-equipped teacher of to-day should have a broad
general culture equivalent to a college education, and a ground-
ing in pedagogy. If he has not had this culture, and resident
courses are not available, he should try to obtain it through
the correspondence schools.
The specialized training of the prospective teachers in ad-
dition to pedagogic study, should be in connection with an
intensive study of groups of commercial subjects. The first
group is the technical group, including accounting and arith-
metic ; the second is the economic group, including commer-
cial geography, history, the technique of commerce, law, and
economics. The third group includes stenography, type-
writing, and English.
Every teacher should have had some practice work in busi-
ness, and this experience should be supplemented, even when
he is already engaged in teaching, by observation work in
business.
414 Principles and Methods in Commercial Education
EXERCISES
GROUP ONE
1. Discuss the progress made in the training of the teacher of com-
mercial subjects.
2. Why should the teacher of bookkeeping have some actual business
experience ?
3. Should a commercial teacher pursue an academic course at college ?
Give reasons.
4. Summarize the views of modern educators regarding the value
of correspondence instruction.
5. Criticise the statement, "the practical accountant makes the best
teacher of bookkeeping."
6. In what subjects of the ordinary college course should the prospec-
tive teacher of commercial subjects specialize ? Why ?
GROUP TWO
1. Plan a summer course in reading for a teacher of business subjects,
who has not had a college education.
2. Prepare a normal course in bookkeeping and accounting suitable
for teachers.
3. Outline an address of inspiration to be delivered to a convention of
commercial teachers, most of whom have had no academic training
beyond the high school.
BIBLIOGRAPHY
Brown, H. B., Available Means and Additional Means Required for the
Preparation of Commercial Teachers. N.E. A. Report, 1907, p. 884.
Bulletin of the Harvard School of Business Administration. Cambridge,
Harvard University, current. (Similar bulletins may be obtained
from other universities. Among them may be mentioned the fol-
lowing: Dartmouth College, Amos Tuck School of Administra-
tion and Finance; New York University, School of Commerce,
Accounts and Finance ; University of Chicago, School of Commerce ;
University of Pennsylvania, Wharton School of Finance.)
COOLEY, E. G., Training of Vocational Teachers in Germany. Washington,
Report of U. S. Bur. of Ed., 1911, Chap. 11.
Preparation and Equipment of the Commercial Teacher 415
DeGarmo, C, Methods of Preparing Teachers for Commercial Schools in
Germany. N.E.A. Report, 1908, p. 902.
Fisher, P. M., The Essentials of the Ideal Commercial Teacher. N.E.A.
Report, 191 1, p. 865.
Pitman, J. A., The Education and Professional Training of Commercial
Teachers. N.E.A. Report, 1910, p. 847.
Weber, F. C, Methods of Improving Commercial Teachers now at Work.
N.E.A. Report, 1907, p. 890.
CHAPTER XVI
Relation of the Secondary School to the Higher
School of Commerce and to the Business Com-
munity
the secondary school and the higher school of
commerce
The topics to be considered in this chapter are very impor-
tant for the secondary school student and graduate, because
they involve a question of the articulation of his work in the
school with his work after graduation. In order to answer
some of the questions that may arise on this point, we must
define once more the vocational aim of the secondary school of
commerce.
Sufficient has been said on this subject to indicate that the
aim of the high school is not vocational in the special sense of
the word, but prevocational. To illustrate the distinction
between the two, we may compare the technical high school
with the trade or engineering school. The latter is designed
to train the specialist in a particular line of activity ; the former
aims to give the student an acquaintance with several lines of
technical activity, to aid him in determining his choice of a
specialty which he is to pursue after graduation, and to give
him that training which will enable him very materially to
reduce the period of apprenticeship in whatever line of in-
dustry he enters.
Our secondary commercial school occupies a position anal-
ogous to that of the technical high school. With the excep-
416
The School and the Business Community 417
tion of the work in stenography and typewriting, it scarcely
may be said to prepare directly for a vocation. It is true
that graduates are prepared to take positions as bookkeepers,
but the school does not bring them to the goal of the book-
keeper's ambition : the profession of certified public account-
ancy. It does, however, give them the general culture, the
ability to take advantage of their opportunities in business,
to observe and to interpret, to pursue self-culture toward
the attainment of this goal by the combination of experience
and self-instruction. The higher lines of technical commer-
cial activity are practically closed to the person who has
had no more than a common school education ; although
in exceptional instances, we find persons of native energy,
intelligence, and will who have mastered the greatest technical
difficulties by self-study or by correspondence instruction.
We must repeat, then, that while the graduate of the sec-
ondary school may be disappointed by having to begin almost
on the same level as the one who has had no such education,
he will outstrip his rival in a short while, and will attain a
position to which, without such education, he never could
have aspired. But the high school graduate need not be too
vain of what he has accomplished, and imagine that his edu-
cation is complete. If there is one thing that a cultured
man realizes, it is the necessity of pursuing the search for
knowledge right through Hfe. The high school graduate
should therefore have developed in his course that thirst for
knowledge which would urge him to satisfy it; and his ex-
perience in business will lead him to see how much he needs
to supplement his knowledge in order to advance himself to
the higher stages of his vocation. He will look about him for
an opportunity for further study, and if he lives in that com-
munity in which are given higher courses of instruction in
41 8 Principles and Methods in Commercial Education
commerce, he will be very fortunate indeed. If this oppor-
tunity does not exist, he will take advantage of the instruc-
tion offered by the better class of correspondence schools.
The curriculum of the university school of commerce is de-
termined both by the needs of the business community and
by the degree of previous training which it presupposes. Its
aim is distinctly practical or vocational. In the secondary
school, the attempt to give specialized courses in real estate,
insurance, or salesmanship must end in failure. The inclusion
of such courses, even as electives, looks well in a curriculum,
but on what basis can the student determine his election ? In
exceptional cases a pupil may have his mind focused on a
definite real estate or insurance office in which a position is
waiting for him after graduation. But the secondary school
cannot afford to give courses for those few, and even if it
could, the work would be of very little value, because it could
not be correlated with practical experience. It is, however,
a very good thing to be able, in a general course, like applied
economics or technique of commerce, to present these special
activities so as to give the student an outlook upon various
business activities in order to suggest problems to him, and
in order to determine his choice of a particular phase of busi-
ness activity. In most cases, the student's choice of a par-
ticular line of business will be determined by accidental cir-
cumstances. If he obtains a position in a bank, then he will
feel that, if he expects to make banking his life work, he must
know the work from all sides. Here comes the greatest func-
tion of the university school of commerce: in offering courses
to students who are already engaged in business, who feel the
inadequacy of their present knowledge, who realize the prob-
lems that exist, and who can fi.nd instruction that will not only
satisfy their need in their present position, but prepare them
The School and the Business Community 419
for the highest achievement in their Une of work. The work
is only another illustration of human experience, that when
theory and practice go together, the results are most successful.
There are certain high school graduates, however, who in-
tend to enter a university school in order to devote all their
time to post-graduate study. The university satisfies the
needs of these students as well, by offering a systematic
course leading to a degree. But even such students should,
in some way or other, spend a part of their time in actual
business. What would we think of the physician who re-
ceives his degree to practice medicine without having done
any clinical work ? It is therefore a peculiar situation to find
a person graduating as a specialist in a certain business with-
out any business experience whatever. Most of the students
in higher schools of commerce either are engaged in business
and devoting a part of their time to study, or they have had
business experience and are taking a year or two off, to do
some studying which will fit them for higher lines of work.
The university also serves the need of business men who
are not able to devote a large portion of their time to study,
but who are interested in certain special lines of work that
correlate with their business activities. These men are cer-
tainly made better for the supplementary training they are
receiving. And finally, the higher school is of the greatest
value to the commercial teacher, as we indicated in Chapter XV.
THE RELATION OF THE HIGH SCHOOL TO THE BUSINESS
COMMUNITY
After all that is said about the commercial high school, the
only prevocational function which still devolves upon it is to
bring the school in closer touch with the business community.
There are at least two reasons for this : First, it must make the
420 Principles and Methods in Commercial Education
theoretic work in the school concrete and appKcable to real
business conditions ; secondly, it must make it easier for the
graduate to adapt himself to his vocational surroundings,
with the least possible waste of effort. The prevocational
technical school has partly solved the problem by bringing
the machine shop and some of the equipment of industrial
life into the school. To a limited extent this may also be done
in the commercial school. It is possible, for example, to have
the standard office equipment, filing systems, calculating
machines, mimeographs, and other duplicating machines, etc.,
as a part of the equipment of the school. The student may
thus become acquainted with office appliances, — an acquaint-
ance which will stand him in good stead.
But an equipment is not a business, and making use of the
equipment is not the same as doing business. Shall we have a
model ofiice, a miniature store or bank, or some other form of
business ? Experiments along this line have not been success-
ful, because they do not impress the student sufiiciently with
the reality of the work ; they are mere play. By arousing
the imagination, we can, of course, give a certain appearance
of reality to the work. In bookkeeping, the good teacher can
impress the student with a reality of the business, the trans-
actions of which he is recording, by making him take an in-
terest in the particular customers with which the firm is deal-
ing, with the margin of profit on which the business is working,
with the progress which the business has made, and with pos-
sible suggestions for improvement that might have to be made.
Successful work along the lines of stimulating the imagina-
tion of the students presupposes very good teaching, very
good business material, and exercises that have an air of
verisimilitude about them.
There is another way in which the business may be brought
The School and the Business Community 421
into the school, although it is not the most substantial way.
We refer to addresses or courses of lectures given by repre-
sentative members of the business community to the members
of the school. A lecture, it is true, is hardly the best peda-
gogical method of impressing the student with knowledge.
But these lectures have a great importance, nevertheless ;
first, they introduce the students to successful types of busi-
ness men, and thus give them a certain amount of encour-
agement. Secondly, they make the students feel that the
business community is taking an interest in them, and is
ready to help them if they show themselves worthy of help.
Thirdly, they are very important in connection with voca-
tional guidance.
It is true that the students in commercial schools have
decided their vocation to be a business career. But business
to-day is highly specialized, and even though a student may
have decided to enter commercial life, the question still re-
mains, in what direction he should specialize. These lectures
give a certain bent therefore to the student's post-graduate
activity. We may say, then, that even if the information
obtained from the lectures is not permanent, the inspiration
given and enthusiasm aroused are abiding, and they there-
fore accomplish their purpose. The New York Chamber of
Commerce has recently organized a series of lectures by
business men to the students of the commercial high schools
of New York. It is very encouraging for the future to find
that the most representative organization of business men in
the city has realized the duty that devolves upon it to co-
operate with the educational authorities of the city to an end
that will serve to the benefit of the community at large.
Systematic work undertaken by organized effort is far
more effective than the desultory work which marks pre-
422 Principles and Methods in Commercial Education
vious effort along this line, and the chamber of commerce or
board of trade in every community should imitate the example
of the New York commercial body, and take initiative in the
matter of closer cooperation between the school and the busi-
ness community. But to insure the success of the system of
lectures, they should be organized into courses, students should
be encouraged to ask questions, supplementary work on the
basis of the lectures should be given by the teachers to their
classes, and the students should be examined on the substance
of the lectures. The courses of lectures should therefore be
regarded as a part of the required work of the school.
If there are limited opportunities for business to come to
the school, the only other way to increase the measure of
cooperation with the commercial community is for the school
to go into the business. In a very small way this can always
be done with a selected number of students by taking them
for observation trips to various industrial and business houses.
The ways and means for effective work in this direction were
suggested in the chapters on the technique of commerce and
commercial geography, and emphasis was laid there upon the
fact that in order to make these visits of educational value,
the students must be prepared to know what to look for, and
they must be required to report upon and discuss the results
of their observations.
A practical way of bringing business and school together
is being worked out by the educational authorities of New
York. The plan is to bring the school into the business
place, to send teachers to some of the large department stores
and organize classes there for the purpose of instructing the
students to a better understanding of their duties in the es-
tablishments in which they are working, and to supply such
deficiencies in the elementary education of the workers as
The School and the Business Community 423
are a hindrance to their progress. Before the pubhc authori-
ties decided to undertake this work, there had aheady been
in existence classes of this sort in the Wanamaker stores and
elsewhere. The estabhshment of this plan on a larger scale
is another realization of the duty which the community owes
to those who have been compelled to go to work before their
elementary education was complete.
But this experiment bears only indirectly upon our par-
ticular problem in this chapter, namely, how to bring the
secondary commercial school in closer cooperation with the
business community. The continuation classes started in the
mercantile establishments are, after all, only subordinate to
the practical work which the pupils are doing in the business.
We are looking at the subject from the standpoint of its
feasibility, with the educational view primary and the prac-
tical or vocational part secondary. It is true that we may
provide higher evening instruction for the graduates of our
secondary school ; and the commercial college which is to be
established in New York under the supervision of the Chamber
of Commerce will supply this need in a large measure. Even-
ing instruction is, however, a drain on the worker who has
been using up his nervous energy all day. The best hours
for mental effort are in the morning or in the late afternoon,
and the problem to work out is how to secure the cooperation
of the business community so as to enable the workers to
devote some of the hours which are most productive for
mental acti\'ity to post-graduate study that will be most
helpful to them in their line of work. The College of Com-
merce will undoubtedly work out a plan of part-time pursuit
of a gainful occupation and part-time instruction in correla-
tion with it — and at such hours as are most productive of
good. But this will still leave unsettled the question, whether
424 Principles and Methods in Commercial Education
we cannot have some practical business training for the student
of the secondary school while he is studying.
Is it desirable, we may ask, assuming that the practical
difficulties can be eliminated, to combine instruction with
employment in business during the secondary school period?
Probably not during the first two years of the course. The
student is not sufficiently prepared, at the age of fourteen, to
do effective work in business, and he needs to devote all his
time to his school work. But in the third and fourth years
some attempt at a combined system should be made.
In order to have a definite line along which we can inaugu-
rate a particular system of coordination between the business
and the school, we must study what has been done along these
lines in the industrial world. There are two systems that
have been installed in different communities, the cooperative
system and the continuation system. In the first system the
manufacturer agrees with the school system to give a system-
atic apprentice course in the trade, while the school agrees to
give special theoretical instruction that is directly connected
with the technical work. In some cases, the school alternates
with the shop, taking the students one week and sending them
to the shop the other. The next week students in the shop
come back to school for instruction, while those who have
been in the school go to the shop. The work in theory and
practice is carefully coordinated, so that one helps and sup-
plements the other.
The cooperative plan has been a great success in Fitchburg.
It has been found that the average boy can do nearly as much
school work as that required in the four-years high school
course, by means of half-time work in school and half-time in
the shop. The superintendent of one of the large industries
of Fitchburg says of the value of this course : "On their
The School and tJie Business Community 425
graduation we find that the high school boys are practically
of the same intelligence, so far as shop work goes, possibly not
quite as keen in touch as the ambitious boy who serves his
time on the old plan, but they have a mental equipment from
their study in the schools that would give them in a few months'
time in the shops the same touch with the addition of the
school training. They are more manly and have wider vision,
and we prefer them to the boys who are taught the trade with-
out the school experience." ^
The cooperative scheme of instruction with its close coordi-
nation between school and shop, such as is found in Fitchburg,
is hardly applicable to business. Commercial work is scarcely
of the same specialized character as shop work, and only coor-
dination of a general kind is required. It would be a highly
interesting experiment, however, to try the plan of letting
pupils in the third and fourth year of the high school devote
one week to instruction and one week to business. It is true
that this plan might necessitate a fifth year of school. But
what of it? The gain would much more than compensate
for the loss. And not more than an additional year to the
regular course would be needed, because the long vacations
would be utilized as a regular part of the course. The ob-
jection that there might be a loss of continuity in the work
is not borne out by the experience of those cities in which the
cooperative industrial plan has been tried. As a matter of
fact, the students would return from business to the school
with a refreshed mind and with a new enthusiasm.
Under the part-time continuation plan, the employee is
left free to engage in school work for a part of every day or
one or more days a week. This system is particularly ap-
plicable to persons who are already engaged in business, and
1 New York Times Annalist, March 23, 1914.
426 Principles and Methods in Commercial Education
who wish to obtain a sounder theoretic foundation for their
practical work. The cooperative system, on the other hand,
is chiefly applicable to persons with whom study is the major
pursuit, and practice is supplementary. Applying the part-
time continuation system to the secondary commercial school
would involve sending third and fourth year pupils for a part
of a day, or preferably for one or two days a week, to the place
of business. Of course it may be argued that no employer
would be willing to break up the routine of his business in
order to give opportunity to some outsider to get some prac-
tical experience. In other words, it may be contended that
an employer would get no use from such an arrangement.
In considering this, it must be remembered that the purpose
of sending pupils of the school to commercial establishments
would be not so much to give them a chance to earn a part of
their way, but to give them some contact with real business.
Even if they do not receive any compensation, they would
still gain a great deal from one day's work a week, outside of
school. Of course the better plan would be to have the al-
ternating system of one week of business and one week of
school, as outlined in the preceding paragraph, because such
a scheme would give a certain amount of continuous, instead
of mere fragmentary, experience. In this alternating scheme,
too, the work of the pupil would be distinctly worth while to
the business man, and it would be fair for him to pay some
wages.
The success of the cooperative plan of instruction is de-
pendent, to a large extent, upon the coordination of the work
in business with the work in school. We have said that the
close coordination found in industry is hardly possible in
business, because the office or business house does not at
any one time reveal all the different phases of the business
The School and the Business Community 427
from the simplest to the most complex, as does the shop, in
which all the different stages in the evolution of a product
may be revealed to the apprentice. But the mere fact that
the student is in business, keeping his eyes open and seeing
the realities of the things that are discussed in theory in school,
is a great means of education, even though the work to which
the student apprentice would be sent would probably be of
a humble character, such as office-boy work. But it must be
remarked that without preparation by the school for the work
that the student is going to do the succeeding week in busi-
ness, the practice work will be almost fruitless. How much
does the office boy, for example, observe of what is going on
in the business, outside the narrow scope of his activity ? The
student should have suggestive problems for observation put
to him. He must be made to feel that he must get the an-
swers to those problems by his observation during his practice
week. He must feel that the work he is doing in business is
an essential part of the work required for graduation from
high school. If progress reports of his efficiency in the prac-
tical work are made, and if the payment of wages is made
conditioned upon efficient work, the student will have the
best incentives to do his utmost ; and the results will be
profitable to the business and to the pupil, and highly satisfac-
tory to his teacher.
Many details connected with the working out of an efficient
scheme of cooperation require special coordinators, such as
are found in Fitchburg : persons who understand both the
needs of the school and the needs of the business community ;
persons who will take charge of the placing of pupils in the
business houses for practice work, who will see that the em-
ployer treats them fairly, and who will follow and check up
their progress. In a large school system it may be necessary
428 Principles and Methods in Commercial Education
to have coordinators for specialized lines of industry, to secure
the best results. Thus, there would be a coordinator for the
banking, insurance, and other financial concerns ; a coordina-
tor for the merchandising and salesmanship business, another
one for accounting, etc. It would also be the duty of the
coordinator to articulate the work of one student apprentice
with the one who succeeds him. As we noted above, the al-
ternating scheme of cooperation requires the pupil to spend
one week in school and another one in the business house.
When he returns to school the next week, his place is taken
by a fellow pupil, who was in school during the week that the
other one was doing practice work. To insure the continuity
of the work in the business house, so as to make it possible for
the employer to respond to suggestions for cooperation, it
would be necessary for the two apprentices, — the one who
is leaving and the one who is taking his place, — to meet
each other to confer about work for the ensuing week. This
meeting, under the direction of the coordinator, could take
place on Saturdays.
In the alternating scheme a pupil would not necessarily do
all his practice work in the same business throughout the year.
It would be preferable for him to have experience in several
lines of business activity. In this way his vocational bent
would be determined, and prospective employers would
have great opportunities to discover possible talents and apti-
tudes of apprentices. This opportunity, which cooperation
gives to pupils " to find themselves," is one of the most valu-
able features of the plan. Any complete scheme of compul-
sory cooperative or continuation instruction that is at all
systematic may involve legislation, the constitutionality of
which might be in doubt. The success of the plan must be
looked for in the direction of voluntary cooperation between
The School and the Business Community 429
the school and the business community and in the pubHc
spirit or enlightened selfishness of the business man. It is
hoped that the chambers of commerce, working in con-
junction with the school authorities, will develop a feasible
and efficient plan of cooperation.
An opportunity for cooperation that should be made use of
is the assignment of pupils, under supervision, to do some of
the business work connected with the school, and even with
some of the departments of the city . government. In several
western communities such a plan has been adopted. One
thing that can be done is to make use of the large opportuni-
ties which the city as an employer can offer for observation
and practice work by students of the commercial high schools.
But there are several additional elements, outside of those
already considered, which will aid very materially in the suc-
cess of the plan. Some of these are as follows :
1. Visits by teachers to business houses. If the school is
to keep alive to the needs of business, the teachers must keep
up with the times. Modern business is growing so rapidly
in its methods that it does not take many years before a book
on a business subject becomes out of date. Even granting a
basis of business experience on the part of the commercial
teacher, it is still possible that he will get out of date, unless
in some way he keeps in touch with changing conditions in
business ; this he can only partially do through reading the
latest books and magazines which deal with business problems.
Every teacher ought to make it his object to spend several
days of the year in the active observation of how practical
business is conducted ; and school boards ought to furnish all
the facilities to teachers in the way of leave of absence, in
order to enable them to do so.
2. Teachers' and Business Men's Clubs. Organizations
430 Principles and Methods in Commercial Education
ought to be formed, consisting of business men and teachers,
for the discussion of problems arising in connection with co-
operation between the school and the business community.
Such clubs will be of benefit to the business man in broadening
his point of view, by showing him the educational problems
involved, and by giving him an opportunity to impress his
practical views upon those immediately in charge of educa-
tional administration and instruction. The clubs will be of
benefit to the teachers in making them more responsive to the
needs of the community, in broadening their outlook, and in
making the results of their teaching more effective, by the
larger opportunities which they will obtain for their pupils in
practical training.
An important result of cooperation will be to make the
business man value more highly the needs of a sound theoretical
foundation, and to insure in the long run a generation of more
efficiently trained men. If the business man gives practical
recognition to the work of the school by honoring the certifi-
cate of pupils who have been trained under the cooperative
plan, the success of it will be more assured.
In conclusion, it will be perfectly evident to our readers,
that just as in the past few years the greatest advance in
commercial education has been in the direction of the estab-
lishment of university departments of commerce as well as
high schools of commerce, so the great advance of the next
few years will be in the line of development of the cooperative
plan of instruction.
SUMMARY
The graduate of the secondary school of commerce is not a
specialist in commerce, but he has a business culture which
will enable him to reduce very materially his period of ap-
The School and the Business Community 431
prenticeship. The function of the higher school of commerce
is (i) to give the high school graduates who have entered busi-
ness the opportunity to specialize in subjects in correlation
with his practical work. (2) To give them an opportunity to
devote the main part of their time to post-graduate study.
But practice work in business should be a required part of
post-graduate study. (3) To give special courses to business
men. (4) To give the commercial teacher supplementary
work.
It is the duty of the school to come in closer touch with the
business community in order to correlate theory with practice
and to make it easier for the graduate to adapt himself to his
vocational surrounding with the least possible waste of effort.
The ways of bringing the business into the school are by
the use of standard equipment, model offices, and miniature
stores, and addresses or courses of lectures. The ways of
bringing the school into the business are by organized obser-
vation trips to business houses, by continuation classes in
business places and department stores, by part-time instruction
in the day or evening schools along the line of the student's
vocation.
Employment of high school students in business as a means
of combining theory with practice is not feasible in the first
two years of the course. Cooperative plans of instruction
have been adopted in fines of industry in a few cities. The
alternating plans of Cincinnati and Fitchburg, by which
students spend one week in school and one week in the indus-
try, have been very successful. The system may be appfied
to commerce also, but without the close articulation possible
in industry. Part-time cooperative plans are not so good as
alternating plans. The success of all cooperative plans re-
quires teachers who will keep in touch with the community
432 Principles and Methods in Commercial Education
through visits to business houses and through clubs ; coor-
dinators who will correlate the theoretical and the practical
work of student apprentices, and the public spirit and en-
lightened selfishness of the business community.
EXERCISES
GROUP ONE
1. What is meant by the vocational aim of the secondary school of
commerce ?
2. Distinguish between vocational and prevocational training.
3. Justify the spending of four years in a commercial high school by a
boy who will have to begin his business career at the "foot of the ladder."
4. How can the high school serve the business community, and how
can business and industry aid the high school ?
5. Discuss the value of a "model office" as part of the equipment of
a secondary school of commerce.
6. Describe what steps the Chamber of Commerce of your community
could take to encourage business education.
7. Describe the Fitchburg plan of coordinating the work of high
school with that of the shop.
8. How does the Cincinnati plan differ from the Fitchburg plan ?
GROUP TWO
1. Outline a plan of cooperation between a commercial high school
and practical office work.
2. Arrange a programme of suitable subjects for a series of addresses
to be given by the leading business men of your community to the
students of the commercial high school.
3. Outline a set of instructions for a group of high school seniors who
have obtained permission to inspect the office equipment and organiza-
tion of a local concern.
4. Prepare a circular letter to the business men of your community,
calling attention to the business training offered by your high school,
inviting inspection, suggestion, and cooperation, and offering to supply
their needs for well-trained office help.
The School and the Business Community 433
5. Assume that six business houses in your community were wilHng
to permit twelve of your students to assist them afternoons and Satur-
days. Arrange a scheme for proper correlation, and explain how you
would utilize this number so as to prove of greatest advantage to the
business men, to the individual pupils, and to the entire class.
BIBLIOGRAPHY
Beckwith, H., German Industrial Education and its Lessons for the United
States. Washington, U. S., Bur. of Ed. Bulletins, 1913, No. 19.
Consular Reports on Continuation Schools in Prussia. Washington,
U. S. Bur. of Ed. Bulletins, 1913, No. 9.
CoOLEY, E. G., Vocational Education in Europe. Chicago, Commercial
Club, 1912.
Dabney, C. W., The Municipal University and Its Work. N. E. A.
Report, 191 2, p. 773.
Farrington, F. E., Commercial Education in Germany. New York.
Macmillan Co., 1914.
Herrick, C. a., Commercial Education as a Branch of Vocational Train-
ing. N. E. A. Report, 1910, p. 861.
James, E. J., Relation of the College and University to Higher Commercial
Education. New York, Amer. Econ. Assn. Publications, 1901.
Report of the Proceedings of the First Annual Convention of the National
Association of Corporation Schools. 1913.
Schneider, H., Report on Vocational Education in New York City Public
Schools. (In Report on School Inquiry.) New York, 1913.
Cooperation of Schools and Shops. Washington, U. S., Bur. of Ed.
Bulletins, 1913, No. 10.
Stuart, R. R., Specially Prepared and Incidental Business Training.
N. E. A. Report, 1913, p. 626.
Wirt, W. A., Utilization of the School Plant. N. E. A. Report, 1912,
p. 492.
INDEX
Account, fundamental notion in book-
keeping, 165.
Accountant defined, 201
Accounting, Chap. VII, 201
place in curriculum, 61
justification for including course, 204
methodology in, 207
syllabus, 206
Advertising and Salesmanship, course in,
277
/Esthetic training, 38
Algebra, apphcations of, to arithmetic, 105
educational value, 7
formulas, value of, 107
rational foundation for arithmetic, 102
Apperception, 76
Arithmetic, blackboard in, 121
Business, Chap. IV, gi
business, reasons for including in high
school, gr
causes of failure in, g2
commercial, educational value of, 6
course of study, iig
diagram in, 122
examination in, 124
oral work in, 122
place in curriculum, 61
rules for elimination of topics, gs
special methods in, 121-
teacher's note-book in, 123
text-book in, 123
topics in higher commercial, no
Assets and Liabilities, statement of, 1 7g
Auditing, 223
Balance Sheet in accounting, 208
in bookkeeping, i7g
Balliet, Dr. Thomas, on adaptation of
arithmetic course to practical life, log
Bank Discount, 114
Biology, educational value, 15
place in curriculum, 57
Blackboard in arithmetic, 121
Bonds, 115
Bookkeeping, Chap. VT, 151
aim of course in, 154
and accounting, educational value, 8
and business practice, place in curricu-
lum, 61
"Budget" or "Voucher" System, 140
ethics of, igi
practice set in, 160
syDabus in, ig5
teachers, 156
texts, 152, 159
Books, special in bookkeeping, 182
Budget, 196
system in bookkeeping, 140
Business community and the school, 419.
Business education, content of, 5
forms, 135
practice and ofl6ce routine, educational
value, II
technique, place in curriculum, 6x
Calculation, artificial aids to, 105
Capital versus income, 202
Case Method in law, 320
adapted to secondar>' school teaching, 323
Cash Book, 83, 183
Chemistr>', educational value of, 16
place in curriculum, 58
Civics, educational value of, 22
Class-room instruction, disadvantages of , 85
Closing the books in bookkeeping, 186
Clubs, teachers' and business men's, 429
College of Commerce, 423
College training, value of, 404
Columns, special, 185
Combined method, in history of commerce,
294
Commerce, Government aid to, 236
History of. Chap. X, 286
human factors in, 234
physiographic influence on, 233
technique of, 271
435
436
Index
Commercial Geography, Chap. VIII, 227
aids in, 246
general geography included in, 237
human factors in, 234
materials of commerce, 241
methods in, 257
organization of material, 243
physiographic elements in, 233
reference books, 247
selection of material, 241
teaching difficulties, 227
topics in, 233
Commercial Law, Chap. XI, 300
correlation value, 310
culture value of, 304
discipHnary value of, 302
drill in, 326
place in curriculum, 63
preliminary topics, 317
selection of cases, 329
selection of topics in, 311
special methods, 324
steps in lesson in, 324
utilitarian value of, 302
Commercial museums, 251
Commission, 112
Composition, 369
aids in, 373
work, correction of, 379
Compound interest, 116
Concrete material for commercial geog-
raphy, 232
mistakes in use of, 78
Concrete to abstract, principle of develop-
ment in teaching, 76
Conflict of laws, attitude of teacher on,
308
Continuation system of apprenticeship,
426
Controlling accounts, 186
Cooperative system of apprenticeship, 422
Coordinators, system of, between the
school and business, 427
Correction of composition work, 379
Correspondence instruction, 406
Cost accounts, 219
Course of study, basis for admitting non-
vocational subjects into, 51
of the secondary commercial school.
Chap. II, 49
principles upon which electives are
offered, 54
problem of constructing, 49
reasons for deviation from standard, 66
schedule for four years, 53
Courts, function of, 318
Customs and duties, in arithmetic, 118
Debit and credit, teaching of, 165
Deductive method in commercial geog-
raphy, 259
in history of commerce, 295
in law, 310, 327
Devices, special, in bookkeeping, 191
Devising a set of books, 222
Diagrams in arithmetic, 122
Difficulties, subdivision of, in arithmetic,
121
Difficulties, in commercial law, 300
in economics, 346
in geography, 227
in technique of commerce, 273
Disciplinary value of law, 32.
influence upon methods of teaching, 307
Double entry bookkeeping, introduction of,
166
Drafts, 188
Drawing, place in curriculum, 63
Drill, in arithmetic, 94, 97
class, special, 105
importance of, 78
in commercial law, 326
Duplicating work, 398
Duties, in arithmetic, 118
Economics, Chap. XII, 344
basis of preparation of student of, 345
debatable topics in, 348
educational value of, 19
fundamental concepts in, 347
ground to be covered, 346
place in curriculum, 62
syllabus in, 356
topics in, 349
Economy, training in habit of, 42
Educated versus self-made men, i
Education, aims of, 2
business, as discipline, 24
Essentials and Value of Business, Chap.
I, I
Electives, principles upon which offered, 54
English, Business, Chap. XIII, 365
business, aim and scope of, 365
place in curriculum, 55
Index
437
Ethics of bookkeeping, 191
business, 44
Examinations in arithmetic, 124
in bookkeeping, 194
in commercial law, 332
Exchange, foreign, 118
study of, 278
Extension courses for commercial teachers,
406
Facts, interpretation of, in commercial
geography, 231
in history, selection of, 288
Figures, organization of knowledge of,
244
Filing, 143, 398
Fitchburg plan of cooperation, 424
Formal discipline, 25
Formal steps of the recitation, 83
in history, 294
Forms in typewriting, 398
Formulas in bookkeeping, 181
use and value of, in arithmetic, 107
Free-arm movement in penmanship, 130
Geography, Commercial, Chap. VIII, 227
educational value of, 20
place in curriculum, 60
Geometry, plane, educational value of, 8
Government, study of economic activities
of, 278
Grammar and rhetoric, 367
Graph, the, in commercial geography, 254
Graphic method, 296
Graphs in bookkeeping, 191
Graphs in economics, 355
Group system of instruction, 87
Habit formation, principles of, 78
Habit subject, 81
Habits, development of, 41
Hatfield, Professor, use of balance sheet
results, 203
Heuristic method, 257
Higher school of commerce, and secondary
school, 416
Historical method in economics, 354
teaching, aids in, 296
History, educational value of, 20
place in curriculum, 58
History of Commerce, Chap. X, 286
methods in, 292
point of view, 292
purpose of course, 286
topics in, 288
Home preparation in bookkeeping, 192
Human factors influencing commerce, 234
Imagination, constructive, in bookkeeping,
189
in commercial geography, 240
in law, 331
training of, 35
Income versus capital, 202
Individual instruction, uses and limitations
of, 85
Induction, method of, 77
versus deduction in bookkeeping, 156
Inductive method in commercial geog-
raphy, 258
in arithmetic, 121
Industrial history of the United States, 291
Industrial revolution, 291
Industries, local, 229
Intellectual training in business education,
25
Interest, in arithmetic, 113, 116
Interest and purpose, 75
Invention in composition work, 373
Journal, 177
Judgment, training of, 29
Known to unknown, principle of develop-
ment, 76
Language drill work, 37
educational value, 5
Languages, foreign, place in curriculum, 56
Law, Commercial, Chap. XII, 300
educational value, 22
Lectures by business men, 421
Legal forms, 328
Letter writing, 375
Library, teacher's law, 334
Local industries, course in, introductory to
geography, 229
place in curriculum, 59
syllabus in, 265
Maps, 252
Manufacturing, study of, 275
Marketing a product, study of, 276
Materials of Commerce, 233
'HE following pages contain advertisements of a
few of the Macmillan books on kindred subjects
Commercial Education in Germany
By FREDERIC E. FARRINGTON, Ph.D.
Associate Professor of Educational Administration, Columbia University
Cloth, i2mo, 267 pages, $1.10
"COMMERCIAL EDUCATION IN GERMANY"
is a study of industrial and commercial training in the
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To the American teacher, he gives not only a broad
view of the educational system, but those definite detail
suggestions of practice so helpful in progressive work ; for
example, in the chapter on Lower Commercial Schools:
The Conditions of Employment
Search for Position
Occupations for Pupils
Apprentice Period.
Under regulations for the Continuation Schools are given
suggestive topics as follows :
Attendance
Discipline and its Enforcement
Year and Session.
In the discussion of the program of study for these
schools, there are worth-while suggestions of each topic
and each main division covering Methods of Instruction
and the Type Lessons given in each grade.
This book, the result of Professor Farrington's thorough
investigation, is a valuable study of a phase of education,
significant to teachers, of ways and means of solving many
of our own educational problems.
THE MACMILLAN COMPANY
Publishers 64-66 Fifth Avenue Nev York
THE MEANING AND PRACTICE OF
Commercial Education
'By CHEESMAN A. HERRICK, Ph.D.
President Girard College, Philadelphia, Pennsylvania
Cloth, i2mo., XV + 27S pages. $1.25
The book above mentioned was prepared to explain the idea and
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An appendix furnishes a goodly number of curricula for schools of
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THE MACMILLAN COMPANY
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Cloth. i2mo. Illuslrated. 252 pages. $.70.
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The whole purpose of the book is to help the student to write a good
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Business Arithmetic for Secondary Schools
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This book is designed for use in those schools in which it is
desired to emphasize the practical rather than the merely theoretical
phases of the subject. The principles of arithmetic are by no
means neglected ; in fact, the simple logical development and state-
ment of these principles is one of the most noteworthy features of
the book. The author does not stop here, however, but goes on to
show how arithmetic is used in the actual processes of business life.
The book not only furnishes an excellent drill in arithmetical prin-
ciples and processes, but it introduces the student to business
technique.
Problems are original and vital and they are numerous enough
to provide abundant practice without becoming a burden. The great
variety of form in which they are stated serves to increase interest
and to emphasize principles rather than form of statement.
Among the topics of common interest treated are rapid adding,
short methods in multiplication, averaging, making change, house-
hold expenses, payment for service, advertising, aliquot parts, practi-
cal measurements, composite units, graphic arithmetic, insurance,
savings accounts, bids and estimates.
The book is alive from beginning to end.
THE MACMILLAN COMPANY
64-66 FIFTH AVENUE NEW YORK
CHICAGO BOSTON SAN FBANCISCO ATLANTA DALLAS
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