An objective method of determining credit

Abstract

Based upon an item analysis of data from 800 successful, 800 unsuccessful, and 800 bankrupt firms, it was concluded that: "1. By breaking a subjective description of a business into individual items which can be treated quantitatively, it is possible to develop objective methods of evaluating credit… . 2. By requiring 100% reporting of items under investigation, such items could be validated and properly weighted… . 3. By observing more items in the field studies, greater reliability could be given to the conclusions… . 4. As a means of making the estimate of 'unsuccessful' and 'successful' more reliable, the credit house should predict the prosperity or failure of particular firms over various periods of time." (PsycInfo Database Record (c) 2025 APA, all rights reserved)