omitted in 1922, 1 in 1923, 1 in 1924, and 1 in 1925. Since the excluded firms were among the smallest in the samples, however, their omission had a relatively minor effect on the composite balance sheets and income statements.

The amounts of total assets, income, and dividends for the sample for 1922-1943 are considerably greater than those for the sample for earlier years. This is due to the fact that in a number of cases larger companies were substituted in the sample for 1922-1943 for smaller concerns included in the sample for 1914-1922. These differences should be borne in mind when trends over the entire period are examined.

For a more detailed description of these samples, see the unpublished manuscript, Corporate Financial Data for Studies in Business Finance, May 1945, available at the National Bureau of Economic Research.

The accounting terms used in these series are defined as follows:

Total assets: Sum of all asset items less depreciation and revaluation reserves.

Cash: Cash on hand and bank deposits.

Marketable securities: Government securities; call and time

loans.

Receivables: Notes and accounts receivable less bad debt reserve. Inventory: Raw materials; goods and work in process; finished goods; supplies-less reserves for inventory.

Investments and advances: Investment in, or advances to, subsidiaries or affiliated; other stocks and bonds.

Fixed assets (net): Land; plant; machinery; equipment; nonoperating property-less reserves for depreciation, depletion, and obsolescence.

Other assets: Prepaid expenses; deferred charges; intangibles; due from officers, directors, and stockholders; cash set aside for specific purposes or not available for immediate use.

Notes payable: All notes or bills to banks, trade, and others. Accounts payable: Accounts payable to trade. Other current liabilities: Accruals and current reserves. Long-term debt: All funded debt or mortgages, whether current or not, less sinking fund when listed on asset side; purchase obligations.

Other liabilities: Minority interest; deferred liabilities; amounts appropriated from surplus for specific purposes; due to officers, employees, and affiliates.

Preferred stock: Preferred and debenture stock less treasury preferred stock when listed on asset side.

Common stock: Common stock (A and B) or capital stock less common treasury stock when listed on asset side.

Capital reserves: Special appropriations from income or surplus for contingencies.

Surplus: Capital and earned surplus less profit and undivided surplus when carried on asset side.

Net income: Net amount after all expenses, interest, and taxes. Dividends: Cash dividends on preferred and common shares. Stock dividends are not included.

V 306–332. Business expenditures for new plant and equipment 1947-1970.

Source: U.S. Office of Business Economics (OBE), 1947–1969, Survey of Current Business, January 1970, p. 25-39; 1970, Survey of Current Business, March 1971, p. 20. Series prepared jointly with U.S. Securities and Exchange Commission (SEC).

These series measure estimated expenditures for new structures and additions to existing plants (including major alterations), as well as expenditures for new machinery and equipment that are chargeable to fixed asset accounts. They include expenditures for replacement purposes and for additions and modernization and exclude expenditures for land, costs of maintenance and repairs, items charged off as current operating expense, new facilities owned by the Federal Government and operated under contract by private companies, and plant and equipment furnished a company by communities and organizations.

Coverage is extended to all private nonagricultural business except real estate operators; medical, legal, educational, and cultural services; and nonprofit membership organizations. The data generally reflect company expenditures, aggregated on a fully consolidated basis, rather than individual establishment data. Each company is assigned an industry classification on the basis of its primary activity, utilizing the Standard Industrial Classification system. Thus, the total capital expenditures of a company for both its primary and secondary activity are included under the assigned industry category. The possible effect of the aggregation of company data in this manner is that the expenditures of one industry could be included in a different industry's total.

Data on plant and equipment expenditures appearing prior to 1947 in a similar OBE-SEC series are not entirely comparable to the series for 1947 to 1970, due to revisions that have occurred. The effect of the revisions, which are benchmarked to data from the 1958 and 1963 censuses, was to increase the rate of growth of capital expenditures over the period for both manufacturing and nonmanufacturing industries.

The gross national product (GNP) series on fixed nonresidential investment (F 54-56) differs from these series in definition and industry coverage. The GNP investment accounts cover capital expenditures of farm enterprises, professional persons, real estate operators, and nonprofit institutions and include oil well drilling costs charged to current expense, automobile costs used for business purposes, net purchases of used capital goods from government, and dealers' margins on used capital purchases, all of which are not covered or included by these series. The national accounts investment data are derived in a largely indirect manner from a variety of sources, with the equipment component resulting from the utilization, basically, of the commodity flow technique that provides commodity detail. The structures component is obtained in an equally indirect manner from Census Bureau construction data and other sources. In contrast, the OBE-SEC series is based primarily on sample survey results and provides expenditure estimates by purchasing industry.