+ 127
+
+to because of its flexibility in the arrangement of the records.
+
+The size of the cards or sheets will depend upon the number of entries which they are to contain and the amount of information they are to record. Usually a 5 x 8 card will suffice but no arbitrary rule can be laid down. The essential thing is for the stores ledger to record the receipt and issue of material and supplies in a convenient form for handy reference so that the quantity of any item on hand can be readily ascertained at any time.
+
+The exact form of the stores ledger card or sheet will vary with conditions. It should record, however, the quantity and value of receipts in columns to the left and similar data as to withdrawals to the right, with a further column or columns to the right to record the quantity, and also the value when necessary, of the material on hand. As receipts are in bulk and issues are in small quantity, more space should be allotted to withdrawals than to receipts. As shown in Form 14, a column under "Receipts" gives the number of the purchase order which authorizes the purchase of the material; also, if this does not appear in the heading, a column may be added for the unit price at which current withdrawals are to be taken. The heading of the card usually shows the name of the article or material entered, its number or symbol, location, unit price, minimum stock below which it should not be allowed to fall, and the quantity to order when the minimum is approached.
+
+For withdrawals the stores ledger card should provide columns for the number of the requisition which
+
+128
+MATERIAL COSTS
+
+authorizes the withdrawal and for the quantity withdrawn. Columns for the quantity left and its cost value are also provided and this quantity and value are usually entered in the balance columns after every third withdrawal. When, however, the withdrawals of any item are numerous and are made in small quantities, it
+
+
+
+ | Article |
+ No. |
+
+
+ | Bo No. |
+ |
+
+
+ | Minimum Stock |
+ |
+
+
+ | Quantity to Order |
+ |
+
+
+ | Receipts |
+ Issues |
+ TOTAL |
+ Current Unit Price |
+
+
+ | Date |
+ Quant. |
+ Issue |
+ Reg. No. |
+ Quant. |
+ Reg. No. |
+ Quant. |
+ Reg. No. |
+ Quant. |
+ Reg. No. |
+ Quant. |
+ Reg. No. |
+ Quant. |
+ Reg. No. |
+ Quant. |
+ Reg. No. |
+ Quant. |
+ Reg. No. |
+ Quant. |
+ Reg. No. |
+ Quant. |
+ Reg. No. |
+ Quant. |
+
+
+
+Form 14. Stores Ledger
+
+is not always necessary to figure on the stores ledger card the value of the balance until the end of the accounting period. It is, however, necessary to place on the stores requisition against which the issue is made the value of the material withdrawn, so that it may be properly charged against the product in which it is used. (See Form 14.) Reference to the "Current Unit Price" readily enables this to be done.
+
+STORES ACCOUNTING AND RECORDS 129
+
+As different lots of the same material may vary in price, the current price must be changed from time to time to agree with the purchase price, if the value of receipts is to balance the value of corresponding withdrawals. Such change must not be made, however, until the material purchased at the former price is completely exhausted. In other words, material must always be "charged out" at the same price at which it has been brought in. No alteration in the unit price is ever made until the material issued is taken from a lot which bears a different price from the preceding one. Prices may go up or down, but this does not affect the card ledger prices until material has been bought and used at the new price. If the price changes materially this change may be reflected in the selling price of the manu-
+
+
+
+ | No or Sign |
+ Article |
+ Unit Price |
+ (Where Shored) |
+ Min. |
+
+
+ | D.O.R. |
+ ORDER NO. |
+ QUANTITY |
+ DATE RECEIVED (DOLVERCH) |
+ BALANCE |
+ DATE RECEIVED (DOLVERCH) |
+ BALANCE |
+
+
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+
+
+
+Form 13. Stores Ledger
+
+130
+MATERIAL COSTS
+
+factured product before any of the raw material is bought at the new price, but this is a question of price-making and does not affect the stores ledger cost price.
+(See Chapter XIII.)
+
+It is always possible, of course, to keep the stores ledger by quantity only without regard to price. In such case, however, the current price should appear on the stores ledger card for use in calculating the cost value of withdrawals and the value of balances at the end of the cost period. Values must be found when the balances of the stores ledger are to be compared with that of the controlling Stores account of the general ledger.
+
+When the quantity of any item kept in stock reaches the minimum point, the stores-keeper notifies the purchasing agent, usually by means of a purchase requisition which calls for the specified “Quantity to Order.” A purchase order is then placed for this quantity, which, when received, replenishes the item of stores up to the maximum requirements of the factory.
+
+5. Control of Stores Ledger
+
+A general proof of the clerical accuracy of the entries in the stores ledger is afforded by the agreement between the total of its balances and the balance of the controlling Stores account on the general ledger. The entries in the stores received book correspond with those in the stores column of the purchase journal or voucher register. The debit entries of the stores ledger are posted from the stores received book. The total of the stores column of the purchase journal is posted at the end of the cost period to the debit of **the**
+
+![]() A page from a book or document.
+
+STORES ACCOUNTING AND RECORDS 181
+
+general ledger controlling Stores account. Therefore, as the source of the debit entries in each case is the same, and assuming the equality of the opening inventory balances, the debit footings should agree.
+
+The credit entries of the stores ledger are posted from the individual requisitions; these same requisitions are summarized in the stores issued book and the total of this summary is posted to the credit of the controlling Stores account at the end of the period. Therefore, as the source of the credit entries in each case is the same, the credits in the controlling Stores account must equal the total credits on the subsidiary ledger if the clerical work is correct and, both debits and credits being equal, in the general ledger and the stores ledger, their balances also must agree. This agreement is the basis of all proper stores control and should be found in every cost system.
+
+6. Control of Issues
+
+The keeping of the stores issued book insures the proper accounting for all stores issued, either as a charge to production or to expense, and when necessary to a particular department. Under the process method of cost-finding the departmental classification of issued stores is all that is required. Under the job order method it is necessary to go more into detail and to record the issue of materials on cost sheets. The requisitions classified or grouped by items and entered in the stores issued book show the kinds of stores used. The same requisitions classified or grouped by order number show the stores which have been used on each job.
+
+132
+
+**MATERIAL COSTS**
+
+An important feature of stores control when goods are made to order is the verification of the fact—if it is a fact—that the various kinds of stores withdrawn for manufacturing purposes have been used on orders and properly charged to them. This verification is arrived at by comparing the total debit to the controlling Work in Process account with the total material charges entered on the current cost sheets. As the entries in both cases are taken from requisitions chargeable to production, they should agree, and thus check the accuracy of each other.
+
+**7. Bin Tag as a Means of Stores Control**
+
+Bin tags, the use of which is suggested by their name, are often used as a further means of controlling stores by recording each issue on the spot, *at the time it is made*. If a tag such as is illustrated in Form 16, is placed on the bin itself, or in a receptacle attached to the shelf or rack on which the article to which the tag refers is stored, there is no excuse for any omission in recording the movement of stores.
+
+Bin tags are only memoranda kept as an additional check on the issue of stores. If entries are accurately made, the record on the bin tag should agree with the material in the bin or on the shelf, as shown by actual count, weight, or measure. Should any serious discrepancy between the controlling Stores account and the subsidiary stores ledger arise, the data entered on the bin tag can be checked with the entries on the stores ledger card. If the figures on the tag agree with the actual count, weight, or measure, but not with the stores ledger card, the presumption is that a posting has been
+
+STORES ACCOUNTING AND RECORDS 133
+
+omitted from the ledger which should be adjusted accordingly. If the bin tag figures agree with those of the ledger card, but not with the physical inventory, something obviously is wrong—probably a failure to enter an issue, or a misappropriation. Of course, in either case the cause of the discrepancy should be investigated.
+
+![]() Form 16. Bin Tag
+
+8. Stores Requisition
+
+A withdrawal from stores is authorized by means of a "Stores Requisition" or "Requisition for Materials" (Form 17). Under the process method this specifies to which department the charge is to be made. Under the job order method it gives the number of the job order against which the charge is to be made.
+
+134
+
+**MATERIAL COSTS**
+
+The usual requisition form gives the date, quantity, description, and value of the stores desired, and indicates the use to which they are to be put—that is, whether they are to be charged to production or to expense. In the column headed "Charge to" is entered the number of the production order or expense order against which the stores withdrawn are to be charged.
+
+
+
+ | Stores Requisition |
+ Dept. No. |
+
+
+ | Date |
+ Quantity |
+ Stores Item |
+ Charge To |
+ Price |
+
+
+ |
+ |
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+ |
+ |
+
+
+ | Issued by ____________ Required by ____________ |
+
+
+
+Form 17. Stores Requisition
+
+The several purposes of a stores requisition may be summarized under the following heads:
+
+1. To authorize the issue of stores.
+2. To distinguish between stores which are to be charged against orders and those which are to be charged to an expense account.
+3. To supply the material cost on the order against which it is to be charged.
+4. To serve as a voucher for the entries to the withdrawal columns of the stores ledger.
+5. To furnish information regarding material issued for entry in the stores issued book.
+
+STORES ACCOUNTING AND RECORDS 135
+
+**9. Bill of Material**
+
+In many factories the materials and finished parts needed to make up a particular order can be accurately determined in advance by referring to blue-prints and specifications. The common practice in such a case is to specify the stores required for a particular order on a "Material Sheet" or "Bill of Material." The general
+
+
+
+ | Job No. |
+ BILL OF MATERIAL |
+
+
+ | Description |
+ 100 Oak, Sable, Flat Top |
+
+
+ |
+ On January 2, 19XX |
+
+
+ | Quantity |
+ Dimensions |
+ Kind of Lumber |
+ No. of Pieces |
+ Blk FT. |
+ No. Feet |
+ Amount |
+
+
+ | 100 |
+ 17" x 28" x 6" |
+ Square Oak |
+ 2000 |
+ |
+ |
+ $2.00 |
+
+
+
+Form 18. Bill of Material
+
+purpose of this form is indicated by its name. This record takes the place of the ordinary stores requisition. Its advantage lies in the fact that it collects the material cost of an entire order on a single document, thus saving clerical labor and insuring accuracy.
+
+The bill of material illustrated in Form 18 is used in a furniture factory. It is made out in the office from
+
+136
+
+MATERIAL COSTS
+
+the blue-print and specifications for the job. The orig-
+inal is the cutting list given the mill, while the duplicate
+is the bill of material for the cost department. Similar
+forms are used in clothing factories for the purpose of
+instructing the cutting department as to the amount of
+material to cut, and of supplying cost clerk with data
+for figuring the material used on a job. In assembling
+industries where articles are made up from standard
+parts the bill of material consists of a list of the parts
+required. In this case the bill of material may be sent
+to the stores-room as a requisition.
+
+10. Stores Issued Book
+
+A "Stores Issued Book" bears much the same rela-
+tion to the issued or credit side of the stores ledger that
+the stores received book bears to the received or debit
+side. As a rule, issues of stores are numerous and
+should be recorded on the stores ledger in detail and on
+the stores issued book in summary day by day. These
+summaries are made up from the requisitions. These
+requisitions should be classified for posting purposes
+according to the type of order under which they fall
+("production" or "expense"), and then, under the de-
+partment from which they are issued.
+
+Form 19 suggests the ruling of a stores issued book.
+The total value of withdrawals for the month is sum-
+marized in the first column and in the remaining col-
+umns the issues are classified by departments and as
+charges to production or to expense. At the end of the
+period, the total in the first column is posted in the gen-
+eral ledger to the credit of the controlling Stores ac-
+count. The corresponding debit is to:
+
+![]() A table showing Stores Issued Book.
+
+STORES ACCOUNTING AND RECORDS 137
+
+![]() Daily Summary of Stores Issued form 10.
+Form 10. Stores Issued Book
+
+
+
+
+ | DAILY SUMMARY OF STORES ISSUED |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+
+
+ | DATE |
+ TOTAL |
+ PRODUCTION ORDERS |
+ DEPARTMENT ORDERS |
+
+
+ |
+ |
+ A | B | C | D | A | B | C | D | A | B | C | D | A | B | C | D | A | B | C | D | A | B | C | D | A | B | C | D |
+
+
+
+
+
+
+
+FOR OFFICE USE ONLY
+
+138
+
+**MATERIAL COSTS**
+
+1. **Production orders in process:**
+ Under the job order method of cost accounting, a summary of all stores issued against production orders is charged to Work in Process account.
+ Under the process method, individual debits aggregating the total of the production orders column are made to the proper productive departments.
+
+2. **Expense orders:**
+ Summaries aggregating the total of the expense orders columns are debited to the departments which have withdrawn the stores.
+
+The stores issued book should contain at the close of the period a daily and monthly record of the value of the stores withdrawn, so classified as to distinguish between stores chargeable to production and those chargeable to expense; and this classification should further show under each head the departments for the needs of which stores have been withdrawn. Under the process method the charge is made to the department only. Under the job order method the charge is made in total to the Work in Process account and is entered in detail on the cost sheets for the production orders.
+
+11. **Material Returned to Stores or to Vendor**
+
+It has heretofore been taken for granted that stores when once issued are completely consumed in manufacture. As a matter of practice, this is not always the case. More material is frequently requisitioned than is
+
+STORES ACCOUNTING AND RECORDS 139
+
+needed for a particular job, in which case a portion must be returned to stores. Sometimes defects or differences in material show themselves after its withdrawal, making it necessary to return the material to the party from whom it was purchased.
+
+The return of invoiced goods to the vendor after they have been taken into stores follows the usual accounting procedure—the reversal of the entries made in both the general ledger and the stores ledger. Such entries, however, are not often made, since defects in goods of sufficient gravity to warrant their complete rejection are generally discovered before the invoice is recorded and passed for payment.
+
+The return to the stores-room of material requisitioned in larger quantity than is needed is usually adjusted through the factory journal, reversing the figures on the books and making the entries in red ink to indicate the nature of the transactions. Under manufacturing conditions where returns to stores are numerous and unavoidable they should be segregated in a separate "Stores Returned Book." "Stores Returned Notes" must then be used as supporting documents for the book entries. As the book and notes simply reverse the operations which have been fully described, no further description of their use and their relation to each other is needed here.
+
+12. Periodical Adjustments
+
+It must be admitted that, however carefully stores may be handled and values recorded, it is impracticable to keep the records with the absolute accuracy of cash records. Items of small intrinsic value, frequently re-
+
+140
+
+MATERIAL COSTS
+
+quisitioned, are sometimes overlooked and the trifling inaccuracies of scales will in time cause some discrep-
+ancy. Shrinkages will sometimes occur and a certain amount of spoilage and waste is unavoidable in the handling of certain stores. If, after all due allowance has been made for these causes of discrepancies, any considerable difference is revealed between the actual balance on hand and that which should be on hand as shown by the ledger, it will be due probably to one of two causes—failure to post one or more requisitions, or the withdrawal of stores without authority.
+
+If a comparison of the aggregate balances of the stores ledger cards with the controlling balance reveals a larger balance in the stores ledger, the figures in the controlling Stores account in the general ledger will probably be the true accounting balance. The discrepancy may be caused by omitting to post one or more stores issues—assuming that the clerical accuracy of the postings and balances has been verified.
+
+If there is any serious deficiency in one or more arti-
+cles or items of stores, as shown by a physical inventory, while the balances in the stores ledger agree with the controlling balance, this difference may safely be attributed either to the issuing of stores without authori-
+ty or to misappropriation. Assuming no malpractice,
+all that can be done to rectify the omission is to consider it as a charge to production which has been omitted and to debit it to general expense, by which means it will be distributed over production in the form of burden.
+
+A higher degree of care is, of course, exercised in keeping stock records of precious stones and metals than in accounting for low-priced stock.
+
+STORES ACCOUNTING AND RECORDS 141
+
+REVIEW QUESTIONS
+
+1. How can stores accounts be controlled?
+2. What is a good method to use for identifying stores?
+3. How should the receipt of stores be handled?
+4. How is a stores ledger operated?
+5. What checks are there on the balances shown on the stores ledger?
+6. When the price of an article of stores varies from time to time, what price is to be used when such stores are issued?
+7. How are stores issues charged?
+8. What records should be kept of stores issued?
+9. To what accounts are stores issues charged?
+10. How should discrepancies in stores ledger balances be adjusted?
+
+CHAPTER XII
+
+STORES PROBLEMS
+
+1. Complications in Determination of Material Costs
+
+When the quantity of raw material entering into a unit of production or consumed in its manufacture can be accurately measured and the price is known, material cost can readily be ascertained. Equally simple should be the calculation when a specific quantity of material is withdrawn from stores for a specific job or process designated on the stores requisition. In practice, however, the figuring of material cost is not always so free from complications. As noted in Chapter XI, prices fluctuate widely; material sometimes loses or gains in weight or in volume from atmospheric or other causes, and after it is requisitioned, may prove defective, or be wasted or spoiled by careless workmanship. Also by-products and scrap frequently result from the processes of manufacturing. The causes of the fluctuations in value or cost or quantity used may be inevitable, intentional even, or they may be accidental, but whatever their origin they occasion many baffling cost problems which need careful handling if exact material costs are desired.
+
+2. Fluctuations of Price
+
+Many kinds of raw material fluctuate widely in price—sometimes changing with every lot purchased. The rule in cost accounting is to withdraw stores at
+
+142
+
+STORES PROBLEMS 143
+
+cost, but their fluctuating prices sometimes render the observance of this rule difficult. This is the case especially when goods are purchased in bulk and it is impracticable to keep one lot separate from another. When the fluctuations are so frequent and so great as to require special methods, the problem may be solved in one of three ways.
+
+The first and simplest method is to take an average price based on the figures of a number of years and to compute the material cost accordingly. This is a rough and ready method which at best is applicable only to those products in the manufacture of which wages and overhead form a much larger item of cost than material.
+
+The second method is to use the material price of a particular lot and to adhere to it until a quantity equal to the particular lot has been withdrawn. This method is simple, as it eliminates the necessity of identifying a specific consignment of goods with any one job or process. When material is uniform and is received in bulk or in large consignments, this method furnishes sufficiently accurate cost figures.
+
+A third method is to keep each new lot of material by itself and price each item issued at its exact cost. Under the job order method this is usually a simple matter. Under the process method of production it involves the use of different plans of handling according to the nature of the stores. Thus in a tannery, a lot number is allotted to each consignment of hides, which is stored by itself. As material is requisitioned the number of the lot from which it is drawn is entered on the requisition by the stores-keeper and the price extended accordingly.
+
+144
+
+**MATERIAL COSTS**
+
+The third method is clearly the most accurate of the three as the material cost is the actual invoice price of the material used plus such charges as freight, cartage, and handling.
+
+**3. Fluctuations in Weight or Volume**
+
+It has been noted above that materials frequently undergo changes in weight or volume due to atmospheric or other conditions. These changes are in some cases very considerable and the unit price at which the material is "charged in" must be changed to meet the new conditions. Thus, if a certain kind of dyestuff costing $50 weighs 100 pounds when taken into stores and loses 10 pounds in weight before it is requisitioned, it must be priced for withdrawal purposes at 5.55½ per pound ($50÷90). Or again, a warp costing $1 a yard and measuring 800 yards before weaving may shrink 15 yards during the process, the yield amounting to 95 per cent. The cost of the warp should then be increased proportionately and figured at approximately $1.058 per yard after weaving, to arrive at the exact material cost of the cloth per yard.
+
+Under such conditions the calculation of material cost is sometimes simplified by computing the physical changes which material may undergo in terms of percentages. For example, when material loses weight, the amount of the loss is expressed as a percentage of the original weight. If a number of lots of cotton weighing, say, 300 pounds before "picking" average 285 pounds after the operation, the percentage of loss is 15–300 or 5%. This standard percentage once determined is then deducted from the weight of all lots
+
+STORES PROBLEMS 145
+
+going through the operation to give the weight of the picked product.
+
+**4. Waste of Material**
+
+Wastage of material in the course of its conversion into finished product is frequently a necessary resultant of the manufacturing processes. This means that having paid so much for a given quantity, weight, or length of material, some of this value disappears in the course of manufacture. The waste may be caused by inevitable conditions. In this case it is one of the legitimate costs of manufacture and requires no special attention save to guard against its exceeding the necessary wastage percentage. It may, however, be the result of carelessness, inferior skill, and poor workmanship, in which case it is a preventable loss that should be avoided. In the clothing and shoe industries, for example, in cutting the raw material an unavoidable waste results which may be very greatly increased by lack of skill. The task of the cost accountant is to determine whether the waste in any given instance is greater or less than may reasonably be expected.
+
+To check unnecessary waste, standards should be established, so that any serious increase over this normal may be promptly detected. By the establishment of these standards the amount of any loss due to a preventable cause is ascertained and a measure of efficiency is set, below which a department or an individual worker is not permitted to fall without investigation. If such a preventable loss occurs, however, it should not be treated as a legitimate material cost but it should be charged to a special "Wastes" account and be handled
+
+146
+MATERIAL COSTS
+
+as an expense item. Thus the direct material costs are not affected by variations in the skill of workers or by carelessness in processing. Furthermore, losses due to such causes are quickly discovered and the fact that they are occurring is emphasized by their inclusion in the waste charge.
+
+5. Defective and Spoiled Material
+
+Defective and spoiled material presents a much more complex problem than wastage. Defects may be discovered and spoilage may take place after considerable expenditure has been incurred in wages and overhead, and thus the cost of the original material is only a small part of the total loss.
+
+Under the job order system, if the spoiled work consists of an article or product complete in itself up to the point when spoilage occurs, the total costs can be debited to a Spoilage account, which is also credited with the scrap value, if any, of the rejected product. The work is then started again. If the spoiled work consists of some part or parts required to complete a more complicated product, the accounting problem is solved by issuing a "Replacement Order." This is virtually a duplicate production order which authorizes the manufacture of a similar part or parts up to the point where the rejection took place. When the workman reaches this point he turns in the order and resumes work on the original production order. By this means the cost of replacing the spoiled work is ascertained with fair accuracy and is, of course, charged to the Spoilage account.
+
+This plan is obviously not applicable to the process method of cost-finding. In bulk production a certain
+
+STORES PROBLEMS 147
+
+percentage of spoiled work is often unavoidable and is perhaps not discovered until the finished product is inspected. In foundry work, for instance, castings frequently show defects after the molten metal has cooled, and these castings are then rejected. Here the defective material can be used again, and the simplest way of dealing with the spoilage is to ignore the defective product and base the cost on the perfect output. Thus, if twenty tons of metal are poured from the cupola, resulting in nineteen tons of perfect and one ton of defective castings, the total cost—less the material cost of the defective castings—is distributed over the nineteen tons to give the unit price per ton or pound. This is virtually treating the cost of the operations on the defective castings as overhead, which is the usual method of disposing of the cost of spoiled product—less any salvage value—under any system.
+
+6. Scrap and By-Products
+
+Scrap consists of the remnants or remainders of requisitioned material too small in size or value to be turned back to stores. Its accounting treatment depends on whether or not the scrap is of sufficient value to affect appreciably the cost of the product. If it is, the value of the scrap, less any cost of preparing it for sale, is usually deducted from the material cost of the production order or process on which it applies.
+
+If the pieces of scrap are small and cannot be identified as coming from the material used on particular orders, their value should be credited to general factory expense, thereby reducing the overhead on the product.
+
+149
+MATERIAL COSTS
+
+Methods of handling and accounting for by-products are determined largely by the nature and value of the particular by-product and vary with the conditions of manufacture. In some cases, notably in the chemical industry, by-products have little or no similitude to the main product. Glycerine, for example, though a by-product in the manufacture of soap, is at the same time a separate and distinct product. For this reason, instead of being treated as an offset to the cost of material, it is considered as a manufactured article and is credited to the Work in Process account or to the account with the operating department in which it is produced, usually at its cost for material.
+
+In wood-working industries scraps of lumber are often worked up into toys, in which case the toy department is usually charged with the pieces of lumber used at what is considered the market value.
+
+7. Material Used "as Needed"
+
+The material cost calculation is simplified when every item is drawn from stores on a requisition and can be charged at once to its own job order number. In some cases, however, operating conditions are such that requisitions cannot be used for all material. Thus, where material is exceptionally heavy or bulky as in the case of the material for heavy castings, it would be obviously impossible to requisition the exact amount required, and in such a case a report of material used takes the place of the requisition. In other cases it may be impossible to estimate the amount of material that will be used in the course of the day's work because much depends upon the speed of the operator. In other in-
+
+STORES PROBLEMS 149
+
+stances it is impossible to estimate with any degree of accuracy because defects are liable to develop in the material in the course of manufacture. In such cases the operative should measure the quantity of the material used as work progresses and report this quantity on a suitable form, which as a rule is a combination time and material record. This is the usual practice in paper-box factories.
+
+8. "Loss and Gain on Estimates" Account
+
+When the quantity of material which will actually be used on a particular order cannot be determined in advance and must be estimated, an account termed "Loss and Gain on Estimates" is opened to show any difference between the estimated material required for individual jobs and the value of the material which is actually used.
+
+Thus in a shoe factory, when a sample line is prepared at the beginning of the season, the quantity of calf-skin required to make the upper leathers of the different styles of shoes is estimated by spreading the patterns over a calf-skin and measuring the number of square feet they cover. The price of the skins is also estimated by taking an average price based on experience and a knowledge of leather prices. These estimates are used throughout the season as the basis of the material cost calculations. If, for example, a production order is issued for a certain number of cases of shoes of a particular style requiring calf-skin uppers, the required number of calf-skins are requisitioned from stores. But, in practice, the area of the calf-skins actually issued is sometimes more and sometimes less than the estimated area
+
+150
+
+**MATERIAL COSTS**
+
+of skin required on an order, their cost varies from time to time, and careless cutting may increase the amount of skin used, so that the actual cost charged on the stores requisition rarely agrees exactly with the estimated cost of the skins. This difference is adjusted by debiting the Loss and Gain on Estimates account with the actual stores value of skins issued and crediting it with the estimated value plus the value of any pieces of calfskin returned to stores. Its balance, representing the difference between the actual and estimated cost of material, is ordinarily closed out to the expense of operating the stores department, i.e., Stores Expense or Material Burden account. (Chapter V, §6.)
+
+**9. Material Wastage and Handling Expense**
+
+A problem which is sometimes met with in calculating the cost of material is where it undergoes changes before it can be used—changes which are sometimes so great that the purchase price bears little or no relation to the charge which must be made to the orders. The woodworking and the steel industries afford good examples of such conditions and of the methods by which they are met.
+
+Thus lumber is purchased at so much a thousand feet and various charges, such as freight and hauling, are incurred in its delivery. Expenses are again incurred in sorting and stacking it, and before it can be used in the factory it must, as a rule, be kiln-dried and sawed into stock sizes. This results in considerable expense and wastage before the raw product is really taken into the factory stores.
+
+The charges for freight, hauling, kiln-drying, saw-
+
+STORES PROBLEMS 151
+
+ing, and so on, incurred before the lumber is ready to be delivered to the factory for manufacturing purposes, are easily handled. Their total is found and their sum divided by the total number of thousand feet of all kinds of lumber actually received. In this way a cost per thousand feet may be determined and added to the cost of lumber delivered to the factory.
+
+The cutting of lumber into stock sizes before it is delivered to the factory results in a certain amount of waste. To determine the amount of waste a tally is kept of the number of pieces of each size cut. At the end of the cost period the total amount of material of all sizes cut from a particular kind or grade of timber is obtained. The difference between this total and the amount of lumber purchased gives the wastage for the cost period. The total amount of material cut is the net amount of lumber available for factory purposes and, when divided into the total cost of lumber, including all costs of freight, handling, drying, cutting, etc., gives the price per foot at which the lumber goes into the factory.
+
+REVIEW QUESTIONS
+
+1. What information is needed in order to make a calculation of the cost of material in a unit of the product?
+2. What is the best method for determining material which has been withdrawn from stores when several lots of the same kind of material have been mixed together?
+3. What effect does an increase or decrease in weight due to atmospheric conditions have on the price?
+4. How is waste material which is the result of manufacturing operations best handled when making cost calculations?
+
+152
+
+**MATERIAL COSTS**
+
+5. What procedure is followed in handling the cost of defective material which has been rejected during the process of manufacture?
+
+6. What disposition should be made of the revenue received from the sale of scraps of material, such as cuttings in a garment factory?
+
+7. What is the purpose of a Loss and Gain on Estimates account? Give an example showing the operation of such an account.
+
+8. How is the wastage which results from the cutting of lumber applied to the cost of the factory product?
+
+CHAPTER XIII
+
+CLASSIFICATION OF STORES
+
+1. Relation to Cost Accounting
+Though the classification of stores and equipment belongs more to the sphere of factory organization and management than to that of cost accounting proper, the accountant is interested in the subject because success in the operation of a cost system is largely dependent upon the accuracy with which stores are accounted for. In a large plant where items of stores run into thousands, mistakes in handling and recording issues are certain to occur unless stores are so classified and symbolized that any one of the several thousand items can be accurately designated and described.
+
+2. Necessity for Stores Classification
+The necessity for some system of stores classification is perhaps most apparent in the mechanical industries where, without it, confusion, if not chaos, would inevitably occur in the handling of stores. A hundred or more different parts, scores of tools, and many kinds of supplies may be needed on a moderately complex mechanical job. To designate each of these by a distinctive and descriptive name would be so burdensome and result in so many errors that an easier and more accurate method is essential.
+
+Even in industries where the need for classification is less obvious some attempt at it will always be found.
+150
+
+154
+MATERIAL COSTS
+
+A walk through any manufacturing plant will show that though the stores-keeper may know little or nothing about the subject of classification, he still follows its first principles by arranging and grouping stores in natural divisions to facilitate handling and counting. Thus in a foundry and machine shop the lumber is usually stored in a shed near the pattern-making shop and classified as to kind and size; the pig iron is in the yard near the foundry, arranged in piles to facilitate counting; the castings are stored in the same fashion near the machine shop; in the general stores-room, commodities, such as screws, bolts, and nuts are arranged, according to size, in separate bins in a section devoted to each kind; oils and inflammable materials are placed in a separate fireproof building; and so on. Here we have a careful arrangement of stores to suit special conditions and in this way the principles of classification are applied.
+
+3. Advantages of Classification
+
+In addition to the obvious fact that the classification and symbolizing of stores and equipment save time and trouble in keeping stores records, a further advantage lies in the fact that the use of symbols compels accuracy in description and thus assists in pricing; reference to the stores ledger file is facilitated and when items are withdrawn for manufacturing purposes, or when an inventory is taken, there is no excuse for vagueness or guesswork in describing the article required.
+
+If the foreman or other employee requisitioning stores is compelled to designate articles by their symbols, he must, before making out a requisition, first con-
+
+![]() A page from a book with text discussing material costs and storage arrangements.
+
+CLASSIFICATION OF STORES 155
+
+sult the stores catalogue or other list to ascertain the symbols of the things wanted. Thus he selects precisely what he needs and describes the item with such precision that no mistake need arise in issuing it or in recording the issue on the books. In the same way, when an entry needs to be made on the stores ledger and one out of perhaps several thousand cards has to be picked out of the file, the card can be found much more quickly and accurately under its number than if referred to first within a class and then under a name within the class.
+
+4. Systems of Stores Classification
+
+There are two broad systems of stores classification — by means of numbers and by means of letters. Under both methods items of the same kind or class are first arranged in general groups to which a key number or letter is allotted. The number or letter which always stands as the first unit in a symbol of several numbers or letters indicates the group to which the item belongs. The remaining numbers or letters of the symbol designate the precise item in a subdivision of the group. Letters are sometimes combined with numerals, thus securing the advantages of both methods. In such a code the letters as a rule refer to the type and kind of article, and the numerals to its location or to its size, shape, or other physical characteristic.
+
+A numerical code possesses one advantage over a letter code in that a number is to most persons more definite. Its position is more easily fixed, it can readily be found in a file or on a bin, and, if out of place, it is more likely to attract attention than a disarranged letter or combination of letters. On the other hand, a code
+
+156
+MATERIAL COSTS
+
+composed of letters is easier to memorize than a numerical code and for this reason is often used in small plants in which the items of stores are comparatively few in number, and a stores catalogue or other printed list is therefore unnecessary.
+
+**5. Numerical Classification Code**
+
+What is known as the "block" system of classification is the simplest of all numerical codes. Blocks or series of numbers are assigned to each main class for the purpose of numbering the items within that class. Thus, the numbers 1 to 999 may be allotted to office supplies. Within this block 1 to 99—or as many of these numbers as necessary—may indicate various kinds of plain paper, 100 to 199 the firm's stationery, 200 to 299 desk stationery supplies other than paper, and so on.
+
+The limitation of this method is that as the blocks of numbers are assigned to broad divisions and items within a class are arbitrarily numbered, the mind does not readily associate any number with a particular article. When certain numbers are used to describe certain generic groups—as in the method to be described in the following section—this limitation is not found.
+
+**6. Dewey Decimal Code**
+
+The Dewey decimal system of classification as used in many public libraries is an elaboration of the block system. Its special feature is the adaptability of the code to new numbers. Because of this elasticity and the clearness with which it designates an article as belonging to a certain generic class, it is finding favor in plants where numerous items of stores are kept in stock.
+
+CLASSIFICATION OF STORES
+
+To explain the operation of the system, it may be assumed that in the stores-room of a wholesale hardware concern many kinds of hand tools and implements are kept in stock and that the number “5” is allotted to the entire class of hand tools. The first broad division designates the general type of tool; that is to say, the first figure in the symbol “5” stands for any kind of hand tool. The second figure narrows the field of a thousand or more possible hand tools by indicating their use, e.g., 51 for the pounding hand tools (the 5 designating a hand tool, the figure 1 its character); in the same way 52 may indicate boring and piercing hand tools, and so on. Having by the use of the symbol 51 narrowed the field to a tool used for the purpose of pounding, the third figure may indicate the kind of pounding tool—511, for example, standing for all classes of hammers. Having arrived at the type of article, the next step is to describe one of a particular kind. This is done by the introduction of a decimal point and the use of further numbers; 511.1, for instance, may stand for tack hammers, 511.2 for claw hammers, while 511.11 may indicate a special size of tack hammer, and so on. It should be noted, however, that there can be no more than nine main groups, no more than nine subdivisions of each main group, no more than nine divisions of these sub-groups, etc. This difficulty may be met by using letters after the ninth item—for instance, 511.9 may be followed by 511.A, 511.B, etc.
+
+The construction of such a code is illustrated in the following example:
+
+
+| 500 | Hand tools, and implements |
+| 510 | Pounding tools |
+
+
+158
+
+**MATERIAL COSTS**
+
+520 Tools for dividing and trimming solids (axes, saws, chisels, scissors, clippers, scythes, and other cutters)
+
+530 Shaping, planing, surfacing, molding, sharpening, filing, and thread-cutting tools
+
+540 Boring and piercing tools
+
+550 Tools for holding and manipulating solid bodies (frames, wrenches, screwdrivers, keys, hooks)
+
+560 Tools for scooping, shoveling, and digging (spoons, shovels, forks, rakes, scoops, and diggers)
+
+570 Tools for blowing, pumping, directing, sifting, and stirring (except shovels, spoons, scoops, and brushes)
+
+The complete code for hammers might read as follows:
+
+- 500 Hand tools, utensils and implements
+- 510 Pounding tools
+- 511 Hammers
+ - 511.1 Tack hammers
+ - 511.2 Claw hammers
+ - 511.3 Sledge hammers
+
+A key must first be used to operate the code until familiarity with the numbers is acquired. With practice the mind quickly identifies particular groups, and classes within the group, with certain numbers. The feature of this system is the association of certain types of articles, not only with specific numbers, but with the position of the number in the code.
+
+CLASSIFICATION OF STORES 159
+
+**7. Mnemonic System of Letter Classification**
+
+A classification code made up of letters which so far as possible are mnemonic, i.e., suggestive of the name to which they refer, can only be used with advantage when the main classifications on the list do not exceed in number the letters of the alphabet. A symbol when associated with a particular article by means of its initial letter is easily remembered, and reference to a key or catalogue list soon becomes unnecessary.
+
+In making up a mnemonic code a base sheet is first prepared. This consists of the letters A to Z, with I and O omitted because they resemble numerals. To each letter is allotted the name of a main class; thus if "S" stands for "Stores," a symbol in which S appears as the first letter would denote some item of stores. The next step is to prepare a secondary sheet or list of different kinds of stores. For example, the classification of stores in the kitchenware department of a wholesale hardware concern might be:
+
+
+
+ | A | Aluminum | M | Enamel and agate ware |
+
+
+ | C | Chinaware | | |
+
+
+ | E | Earthenware | N | Nickel ware |
+
+
+ | F | Fibrous ware | P | Copper ware |
+
+
+ | G | Glassware | R | Rubber goods |
+
+
+ | H | Hardware | S | Steel and iron ware |
+
+
+ | K | Crockery | T | Thinware |
+
+
+ | L | Lighting fixtures | V | Stoves |
+
+
+ | | W | Wooden ware |
+
+
+
+It will be noticed that in twelve out of the sixteen items listed the initial letter of the word is used; in the
+
+160
+MATERIAL COSTS
+
+remaining cases the initial is suggested by the sound of the word.
+
+To carry the classifications a step further, in codify-
+ing, say, chinaware, B may be used for bowls, C for cups, P for pitchers, S for saucers, T for platters, and so on, with numbers to designate the particular kinds of pitchers, bowls, etc., carried in stock. Thus, the com-
+plete symbol for a special pitcher carried in the china-
+ware section of the stores department may be S C P 10.
+Such a symbol is much more easily impressed on the mind than one composed wholly of numerals.
+
+8. Combination Code
+
+Numerals are sometimes combined with letters to
+furnish information according to their position in the
+code. Suppose, for example, that a large concern op-
+erates a number of stores-rooms in different parts of its
+plant. In such a case requisitioning is simplified if the
+stores-rooms are numbered and the numbers are intro-
+duced in the symbol after the letter "S" to indicate the
+location of the particular item referred to in the code.
+Thus, to take the preceding example, if kitchenware is
+stored in room 5 the symbol for pitchers becomes S^2 C P 10,
+the number being smaller in size than the let-
+ters and printed above the line. Numbers are frequently
+used in this way to indicate different brands and sizes
+of the same article.
+
+9. Important Points in Devising a Code
+
+The system of classification to be simple and logical
+should be based upon the physical characteristics of
+stores and equipment. Where many thousand items
+
+CLASSIFICATION OF STORES 161
+
+are to be classified, study will reveal that many of these have qualities in common, allowing logical grouping into main and sub-classifications. Unless the code is logically arranged and easy to understand, workmen are apt to shrink its use and in consequence mistakes occur. The main object of symbolizing is to furnish an abbreviated means of accurately designating any article. Therefore, the ideal code is one that condenses specific information within a brief symbol which is easy to memorize and which cannot be confused with another symbol.
+
+Whatever the code adopted, it should be definite enough to prevent any article finding its way into more than one class and complete enough to include all stores and every piece of equipment; it must be elastic so that additional items of stores and equipment can be inserted as they come into stock without disturbing the arrangement of the articles already classified. The dumping of unclassified items into a miscellaneous section should be avoided.
+
+10. Stores Catalogue
+
+After all main and sub-classes of the code have been decided upon and after a symbol has been assigned to each article within a class, the final step is to prepare a catalogue which will serve as an index to the stores classification. Confusion is apt to arise in the handling of items because of slight differences between two articles of the same kind which are hard to describe or because sizes are not clearly specified or because the proper designation of a particular item may not be known. Such confusion is obviated by the use of a catalogue of stores which furnishes a correct description of every item of
+
+162
+MATERIAL COSTS
+
+material and supplies carried in stock, so grouped and arranged that reference to its code number requires but a moment.
+
+REVIEW QUESTIONS
+
+1. What purpose is served by a classification of stores?
+2. What is meant by the numerical system of stores classification? What are its advantages and disadvantages?
+3. What is the mnemonic system of stores classification? What are its advantages and disadvantages?
+4. What is the block system?
+5. What is the Dewey decimal code? Illustrate.
+6. What is a combination code? Illustrate.
+7. What purpose is served by a stores catalogue?
+
+Part V
+Labor Costs
+
+[API_EMPTY_RESPONSE]
+
+CHAPTER XIV
+
+RECORDING THE COST OF LABOR*
+
+**1. Labor Cost Problems**
+
+As labor is always an important element of cost and often constitutes the largest item in the cost of manufacture, the importance of accurate labor records cannot be emphasized too strongly. Without such records there can be no accurate cost accounting, nor as a rule can there be economical production. If labor is wrongly reported, the cost records will be meaningless or misleading; some jobs may show too high a labor cost and others too low. If labor is lost or frittered away, the cost records should disclose the fact and point the way to such investigations and action as will prevent its recurrence.
+
+The computation of the direct labor cost of a product is comparatively simple and there is no reason why it should not be accurate. A predetermined wage is paid for either the productive time of workers or for the number of pieces produced and these wages are always a matter of record on the factory books, whether or not a cost system is in operation. For cost purposes it is only necessary to apply these wages to the product upon which the labor has been expended.
+
+Under the process method the procedure for obtaining labor cost is simple, requiring little, if any, special mechanism. Under the job order method the procedure
+
+*See Volume II, Chapter XXVI, "Labor and Salaries."*
+
+165
+
+166
+LABOR COSTS
+
+is more complex. Special forms are required to con-
+nect the wages of the individual workers with the dif-
+ferent orders on which they may have been engaged dur-
+ing the cost period. The forms used and the routine
+followed vary with conditions.
+
+2. Labor Costs under the Process Method
+
+The labor records of a cost system have a dual pur-
+pose: (1) to supply pay-roll data upon which the wage
+payments to employees may be based, and (2) to sup-
+ply information as to where or how the services of em-
+ployees are expended, so that proper charges may be
+made against the product.
+
+Under the process method, the same pay-roll which
+records the wages and the salaries of the employees can
+also be made to show the labor cost on processes and
+thus the labor cost of the product. This result is se-
+cured by the segregation or grouping on the pay-roll
+of the names of employees by departments. The total
+of wages and salaries of each department is taken from
+this pay-roll and charged to the proper departmental
+process accounts at the end of the period. It is unneces-
+sary to distinguish between productive and non-productive labor. The clerk, the foreman, and the floor-
+sweeper on the pay-roll of a process department are
+considered for accounting purposes as essential to pro-
+duction as the workmen who do the actual productive
+work in the department. The salaries of the administra-
+tive officers, superintendent, inspectors, time clerks,
+watchman, and others who are not directly connected
+with any particular department should be charged to general expense.
+
+RECORDING THE COST OF LABOR 167
+
+If only the labor cost of the unit of production is desired, the labor cost of each department or process divided by the total output for the period gives the labor cost per unit for each department, and these departmental labor costs added together give the total labor cost for each unit of output. Or the sum of the labor costs of all processes or departments for the period divided by the total output for the period will likewise give the total labor cost for each unit of production.
+
+3. “In and Out” Time
+
+Where labor is paid for on a time basis, as is usually the case under the process method, the original factory document from which the time chargeable to each department is entered on the pay-roll is the “gate” record, on which is registered the time when the employee enters and when he leaves the factory or his department. This time card or ticket bears the same relation to the pay-roll that an invoice bears to the purchase journal. The pay-roll classifies purchases of interior personal service, as the purchase journal classifies purchases of goods and exterior service—in both cases the allocation, so far as possible, being to departments.
+
+The gate record is commonly kept by means of a time clock. The superiority of this method in comparison with the old-fashioned check system is so obvious, and time-recording mechanism of one form or another is now so universally used, that a detailed description of the method is unnecessary. The gate record presents documentary evidence of the hour and minute when employees enter and leave the premises and gives an authoritative basis for labor charges, incidentally distin-
+
+![]() A page from a book about recording labor costs.
+
+168
+LABOR COSTS
+
+guishing between those employees who are late and those who are punctual.
+
+4. Job Order Labor Costs
+
+A clock of the type used to record gate time indicates the hours of arrival and departure. This meets the requirements of a process cost system—particularly if departmental time clocks are used—but is not adequate for a job order system, as a record based on gate time obviously does not indicate how time is spent within departments. For job order purposes the gate time record, if kept, must be supplemented with time cards or some similar means of showing in detail the disposition of the employee's time and the amount of wages to be charged to each order.
+
+Whatever the system of time-keeping employed, the pay-roll in a job order cost system should classify the employees by departments to determine the departmental labor cost, and in addition should be so ruled as to separate direct and indirect labor. When this is done the totals of the current payments for direct labor chargeable to orders—which must, of course, equal the sum of the detailed labor charges to orders for the same period—can be taken from the pay-roll, as can also the indirect labor charges for the departmental expense accounts. Under this method, the payments to workmen who fashion the product appear in one column as a direct labor charge, while the time of superintendents, foremen, and general utility men appears in another column as a charge to general expense or the expense account of some operating or service department, as the case may be.
+
+RECORDING THE COST OF LABOR 169
+
+**5. Time-Work**
+
+Productive labor is paid either on a time basis, or by piece-work, or by some bonus or premium plan which is a combination of both time- and piece-work. When time rates are complicated by the payment of premiums or bonuses for production above the established standards, the computation of labor costs is sometimes a matter of difficulty.
+
+Where direct labor is paid for at different hourly rates based on the grade and skill of the worker, the amounts to be charged to orders and entered on the payroll are obtained through the medium of individual time records. Here the forms used will be determined by the conditions of manufacture, the object in all cases being to show on which orders an employee has worked and the time devoted to each order day by day.
+
+In recording time, it is important to obtain an exact agreement between the pay-roll totals of productive labor and the various amounts charged to the different orders. Thus, if a workman arrives at eight in the morning and leaves at noon, his total time for the forenoon as shown by the gate record is four hours and the record in the shop should also show four hours of labor—less any lost time. These four hours may have been devoted to one job or may perhaps have been divided among a number of jobs according to the conditions. To ascertain whether or not this agreement exists, the daily total hours charged to orders in each department, as taken from the workman's time tickets, should be compared with the daily gate time and any differences recorded. The gate time thus serves as a check on the accuracy of the shop time. The time records for each day
+
+
+
+ | 5. Time-Work |
+ Productive labor is paid either on a time basis, or by piece-work, or by some bonus or premium plan which is a combination of both time- and piece-work. When time rates are complicated by the payment of premiums or bonuses for production above the established standards, the computation of labor costs is sometimes a matter of difficulty. |
+
+
+ |
+ Where direct labor is paid for at different hourly rates based on the grade and skill of the worker, the amounts to be charged to orders and entered on the payroll are obtained through the medium of individual time records. Here the forms used will be determined by the conditions of manufacture, the object in all cases being to show on which orders an employee has worked and the time devoted to each order day by day. |
+
+
+ |
+ In recording time, it is important to obtain an exact agreement between the pay-roll totals of productive labor and the various amounts charged to the different orders. Thus, if a workman arrives at eight in the morning and leaves at noon, his total time for the forenoon as shown by the gate record is four hours and the record in the shop should also show four hours of labor—less any lost time. These four hours may have been devoted to one job or may perhaps have been divided among a number of jobs according to the conditions. To ascertain whether or not this agreement exists, the daily total hours charged to orders in each department, as taken from the workman's time tickets, should be compared with the daily gate time and any differences recorded. The gate time thus serves as a check on the accuracy of the shop time. The time records for each day |
+
+
+
+170
+LABOR COSTS
+
+should be checked up on the morning of the following day and any discrepancies should be immediately inquired into while the details are fresh in the memory of all concerned. These discrepancies may arise from many causes. Sometimes mistakes are made in entering time on the tickets, or odd quarters and half hours lost by tardiness are not deducted on the time tickets.
+
+When the gate and shop records agree, the time on the individual time tickets is extended in terms of money. The time tickets are then classified by order number, entered on the cost sheets of the orders to which they apply, and passed on to the pay-roll department. Here they are sorted by clock numbers—which appear on the time tickets as well as on the gate record—and the amounts representing wages due to productive workers are entered on the department pay-rolls. By checking day by day the total number of hours charged to orders and to expense (see Chapter XV) with the gate time, and by using the shop time records as the source of both the pay-roll and the cost figures, an agreement between the total amount of wages for the period and the wages charged to orders and department expense can be obtained daily, weekly, or monthly, as required.
+
+6. Piece-Work
+
+The forms of time tickets or other records used for computing the labor cost on orders naturally vary with the conditions of manufacture and shop routine. Where labor is paid for by the piece the time record usually takes the form of a piece-work slip or ticket (Form 26, page 186), the purpose of which is to record the quantity produced, the wages to be paid, and the number of
+
+RECORDING THE COST OF LABOR 171
+
+the production order to which the wages are to be applied.
+
+One difficulty in piece-work is the verification of the quantity produced. Where articles are made to be turned into stores, the stores-keeper's record of the quantity received may be taken as proof of the correctness of the piece record. In many factories, however, work passes from hand to hand—as in a jewelry factory. Here the numerous operations performed on the product are often paid for by the piece. Since the number of pieces may diminish as defects develop, or as work is spoiled in processing, the stores-keeper's record is no longer a safe check on the piece-work records. The verification of the quantities shown on the individual records under such circumstances will vary with the conditions and falls more within the province of shop management than that of cost accounting. The cost accountant is chiefly concerned with the labor pricing of the pieces produced, with the entry of the wage amount on the pay-roll, and with the proper charging of this amount to the order by means of its cost sheet.
+
+It is clear that if all work on an order is paid for at piece rates, a summary of the piece cost slips or tickets belonging to this order will give its productive labor cost. It is clear also, that if a summary of the productive labor for the period as entered on the pay-roll is made, the figures should agree with the summary of the current piece cost slips which are debited to the controlling Manufacturing or Work in Process account. This agreement establishes the fact that the current productive wages recorded on the pay-roll have been in one way or another charged to orders.
+
+172
+LABOR COSTS
+
+**7. Pay-Roll Form and Procedure**
+
+The precise form of the pay-roll is immaterial so long as it classifies the total wages of the period by departments and, in a job order factory, so long as it distinguishes between productive and non-productive labor within the operating departments. When the cost period does not always coincide with the pay period, as where the cost period is a month and wages are paid weekly, the cost accountant's work is simplified by showing the amount of wages due to each worker—whether on an hourly, weekly, or salary basis—day by day. The pay-roll columns can then be footed and posted at any time.
+
+The general procedure in entering up the pay-roll is as follows: As checks are drawn for wages and salaries at the end of each pay period, the account kept with wages and salaries in the general ledger is charged with the amount. At the end of the cost period the amounts thus accumulated (plus any wages accrued should the cost period not coincide with the pay period) are closed out in accordance with the classification of wages and salaries shown on a pay-roll analysis sheet. In other words, under the process method, Wages and Salaries account is closed out to departments; under the job order method direct labor is closed out to the controlling Manufacturing account or accounts, and indirect labor and salaries to the departmental expense accounts.
+
+Whether one controlling Manufacturing account or separate productive department Work in Process accounts are used to record the cost of manufacture, the only difference in the procedure is in the closing entries
+
+RECORDING THE COST OF LABOR 178
+
+to Pay-Roll (or to Salaries and Wages account) which under the process method shows the distribution to the several departments. The following journal entry which summarizes the labor operations of a woolen mill is typical:
+
+
+
+ | Stock in Process (Dye House) |
+ $........ |
+
+
+ | Mixes in Process (Picker Room) |
+ ........ |
+
+
+ | Yarn in Process (Carding and Spinning) |
+ ........ |
+
+
+ | Cloth in Process (Weaving) |
+ ........ |
+
+
+ | Cloth in Process (Finishing) |
+ ........ |
+
+
+ | Maintenance and Building Up-keep |
+ ........ |
+
+
+ | General and Office Expense |
+ $........ |
+
+
+ | To Pay-Roll. |
+ $........ |
+
+
+ | To distribute pay-roll charges. |
+ |
+
+
+
+8. Accuracy of Records
+
+The accuracy of the entry to the Manufacturing account (or accounts) may be tested by summarizing both the current shop time tickets or sheets and the current charges for labor on the cost sheets. The three totals should be in agreement. The accuracy of the totals of indirect labor charged to the various department expense accounts can be tested by comparing the total indirect labor for the period with a summary of the indirect wages entered on the current standing expense orders—the operation of which is explained in Chapter XVIII.
+
+As the labor cost is usually a very large part of the value of a product, the time spent on any job should be kept with the strictest accuracy. Moments wasted here and there, particularly when beginning and quitting work, may seem of no importance, but in a large factory they amount in the aggregate to a serious item of cost.
+
+174
+
+LABOR COSTS
+
+Such waste is caused by lack of discipline. To main-
+tain discipline reasonable rules should be prepared and
+enforced and employees should be impressed with the
+importance of economy in the use of time and of exact-
+ness in recording it.
+
+REVIEW QUESTIONS
+
+1. How is the labor cost applied to the products in a process factory,
+such as a flour mill or a tannery?
+2. How is labor cost distributed in a job order factory where
+operators are paid by the hour, as in a sheet metal or novelty
+goods establishment?
+3. How should the pay-roll be analyzed in a job order factory?
+4. What internal check do labor cost records afford on the pay-roll?
+5. How is the labor cost applied where operators are paid by the
+piece, as in shoe, glove, and clothing factories?
+6. To what accounts is the pay-roll charged in process factories?
+7. What entry is made to distribute the pay-roll in a job order
+factory?
+
+![]() A page from a book about labor costs.
+
+CHAPTER XV
+
+TIME AND PAY RECORDS
+
+1. Individual Job Tickets and Time Reports
+
+There are two general methods of recording the productive time chargeable to orders. The first method requires the use of an individual time card or other form of time ticket to report the time expended on each order number. In this case any time which elapses between the finishing time of one job and the beginning time of another is not shown on the two time tickets used because they record only the actual time worked; the interval between the jobs is lost time. The second method is to record on a single time card or sheet the complete disposition of each man's daily time; in this way any idle time or time devoted to unproductive labor appears upon the time report as the worker must account for his full time theron.
+
+The advantages of the individual order number card are its flexibility and the ease with which labor can be calculated by classifying the cards under orders and operations. A disadvantage is the liability to error where the record is made on separate cards, the tendency being to charge more time to orders than is actually worked, especially when operations are frequently changed. When the disposition of the total hours worked is made upon a single report form there is no loophole for odd quarter- and half-hours to be charged to two orders. A drawback to the use of time reports
+
+175
+
+176
+LABOR COSTS
+
+of this nature is that the time spent on orders cannot be so readily determined when one report relates to several orders as it can when each time card relates to its own particular order.
+
+The first method is generally used when it is desired to ascertain the cost of different hand or machine operations performed upon a particular piece, as in machine work. The second method is commonly employed in shops where the operations are not sharply defined and where the same kind of work may be done by men paid at different rates. In such a case any man competent to do a certain class of work does it regardless of his rate of pay and the cost charge for such work—as in the composing room of a printing plant.
+
+**2. Making the Time Record**
+
+The safest time report is that in which the beginning and finishing time is recorded by a time clock or stamp. It is usually impossible for employees to tamper with a mechanical time recorder and its use effectively precludes the falsification and evasion so easily possible when the time records are made by hand.
+
+If mechanical time recorders are not employed, reports must be made out by hand, the method varying according to the conditions. In some shops the men themselves make the time record. In others, a time-keeper circulates among the men and records the time of each job. In some cases the foreman is the official timekeeper and enters the time as the workmen report to him. None of these plans is entirely satisfactory. Almost invariably when the men report to a timekeeper they make a pencil memorandum of the time to be re-
+
+![]() A page from a book about labor costs.
+
+TIME AND PAY RECORDS 177
+
+ported aud, if the workman's memorandum is depended upon at all, it might better be the final entry than a pre-
+liminary note. It may also be said generally that it is not conducive to accurate records to require shop hands to do clerical work. The time entries are better made by the mechanical recorders which do the "accounting," thus requiring of the workmen only the actuating impulse.
+
+A certain amount of "filling in" is, of course, necessary with any kind of time card. The body of the card is best made out by a clerk or the foreman of the factory, leaving only the starting and stopping time to be filled in by the workmen. If a time recorder is used, the entry of this starting and stopping time is a purely mechanical act on the part of the workmen.
+
+3. Non-Mechanical Daily Time Cards
+
+Form 30 shows how the time of operators in a machine shop is recorded against a particular order. The employee's number, the date, and the order number are entered at the top of the ticket. A description of the job follows, the operation to be performed is punched at the side, and the time when the operation begins and ends is punched at the bottom of the card, the day being divided into intervals of a quarter or an hour each. The elapsed time is entered on this card and is extended at the operator's rate in order to determine the labor cost chargeable to the job.
+
+A summary of the time recorded on all cards bearing the same job number, classified by operations, gives the direct labor cost on the job by operations. A further classification to show the cost of hand work as distin-
+
+
+
+ | FORM 30 |
+ SHOWS HOW THE TIME OF OPERATORS IN A MACHINE SHOP IS RECORDED AGAINST A PARTICULAR ORDER. |
+
+
+ | THE EMPLOYEE'S NUMBER, |
+ THE DATE, AND THE ORDER NUMBER ARE ENTERED AT THE TOP OF THE TICKET. |
+
+
+ | A DESCRIPTION OF THE JOB FOLLOWS, |
+ THE OPERATION TO BE PERFORMED IS PUNCHED AT THE SIDE, |
+
+
+ | AND THE TIME WHEN THE OPERATION BEGINS AND ENDS IS PUNCHED AT THE BOTTOM OF THE CARD, |
+ THE DAY BEING DIVIDED INTO INTERVALS OF A QUARTER OR AN HOUR EACH. |
+
+
+ | THE ELAPSED TIME IS ENTERED ON THIS CARD AND IS EXTENDED AT THE OPERATOR'S RATE IN ORDER TO DETERMINE THE LABOR COST CHARGABLE TO THE JOB. |
+ A SUMMARY OF THE TIME RECORDED ON ALL CARDS BEARING THE SAME JOB NUMBER, CLASSIFIED BY OPERATIONS, GIVES THE DIRECT LABOR COST ON THE JOB BY OPERATIONS. |
+
+
+
+178
+
+LABOR COSTS
+
+
+
+ | Assembling |
+ Employee No. |
+ Date |
+ Laying Out |
+
+
+ | Boring |
+ Shop Order No. |
+ 19 |
+ Milling |
+
+
+ | Boring |
+ for HAND WORK PUNCH OPERATION TWICE |
+ Painting |
+
+
+ | Cutting |
+ Description |
+ |
+ Planing |
+
+
+ | Filing |
+ |
+ |
+ Shaping |
+
+
+ | Filing |
+ |
+ |
+ Tapping |
+
+
+ | Filing |
+ |
+ |
+ Threading |
+
+
+ | Grinding |
+ Quantity |
+ Hours |
+ Rate |
+ Amount $ |
+ Turning |
+
+
+ | Keyseating |
+ 7 % 36 % 36 % |
+ 8 % 56 % 9 % 10 % 16 % 13 % 56 % |
+ % 12 % 36 % % |
+ % |
+
+
+ | Jaw Seating |
+ 36 % 36 % |
+ 2 % 56 % 3 % 56 % 4 % 36 % 9 % 2 % 36 % % |
+ % 6 % 36 % % |
+ % |
+
+
+
+Form 20. Time Card—Machine Shop
+
+Operator No.
+Name
+Order No.
+
+
+| Quantity | Description | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|---|
+
+No.
+ Hours |
+ Minutes |
+ Total Time |
+ Article |
+
+
+ | Time |
+ Rate |
+ Total |
+ Time |
+ Rate |
+ Total |
+ Rate |
+ Time |
+ Rate |
+
+
+
+
+ | 7 |
+ 10:00 |
+ 7.62 |
+ 7.62 |
+ 1:54 |
+ 7.62 |
+ 7.62 |
+ 1:54 |
+ 7.62 |
+ 7.62 |
+
+
+ | 8 |
+ 10:00 |
+ 7.62 |
+ 7.62 |
+ 1:54 |
+ 7.62 |
+ 7.62 |
+ 1:54 |
+ 7.62 |
+ 7.62 |
+
+
+ | 9 |
+ 10:00 |
+ 7.62 |
+ 7.62 |
+ 1:54 |
+ 7.62 |
+ 7.62 |
+ 1:54 |
+ 7.62 |
+ 7.62 |
+
+
+ | 10 |
+ 10:00 |
+ 7.62 |
+ 7.62 |
+ 1:54 |
+ 7.62 |
+ 7.62 |
+ 1:54 |
+ 7.62 |
+ 7.62 |
+
+
+ | 11 |
+ 10:00 |
+ 7.62 |
+ 7.62 |
+ 1:54 |
+ 7.62 |
+ 7.62 |
+ 1:54 |
+ 7.62 |
+ 7.62 |
+
+
+ |
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+TIME AND PAY RECORDS
+181
+
+ates not only human fallibility and fraud but any charge of favoritism on the part of the foreman as well, while its records are quickly made and are beyond dispute.
+
+Form 23 illustrates a convenient method of measuring by mechanical means shop time spent on jobs. It differs from the ordinary clock card which gives the beginning and finishing time, inasmuch as it gives the number of hours and minutes actually spent on the job. Of
+
+![]()
+A circular clock face with various symbols and numbers around the edge.
+
+
+| TIME EMPLOYED | COMMENCED |
+|---|---|
+| Aug 15 1919 | Workmen No. 54 |
+
+| Boring | Drilling | Grinding | Planning | Tapping | Time Allowed |
+|---|---|---|---|---|---|
+| Shipping | Facing | Milling | Roughing | Threading | Premium Credit |
+| Cutting Off | Filing | Mounting | Shaping | Turning V | Remain |
+
+Quantity ____________ Total Time: 3.6 Rate: 30 Cost: ____________
+
+Form 23 Mechanical Time Card
+
+the three "dials" shown on the face of the card, the one to the right records by means of the triangular-shaped wedge the time the operation begins. This record is stamped on the card by inserting it in the clock and pulling a lever. After the "commenced" time is stamped in this way, a reverse pull on the lever prints the two dials over "time employed" but without showing the arrows. When the work is finished the card is inserted again and a pull of the lever prints in the arrows, showing in hours and tenths of an hour, the time the opera-
+
+182
+
+LABOR COSTS
+
+tion has occupied. Form 23 shows that employee number 54 began work at 1 P.M. on August 15, 1919, that he performed a turning operation on job 125, and that he worked 3.8 hours, the dial in the center recording the time by tenths of an hour.
+
+The object of indicating time by hours and tenths of hours in this way is to facilitate the computing of the labor cost. For example, it is much easier to multiply 3.8 by 30 cents per hour and obtain $1.14, than to apply the hourly rate of 30 cents against 8 hours and 48 minutes. Such a card as this simplifies the task of making up the pay-roll and insures reports for the full time spent on particular jobs.
+
+5. Daily Time Sheet
+
+Under some conditions, as previously stated, the disposition of each man's daily time may be more conveniently recorded on a single sheet than on a number of tickets. Such a sheet is illustrated in Form 24. The feature of this record, which is used in the composing room of a printing establishment, is the ease with which time may be charged against orders. Its operation can readily be understood by a study of the form. Assume that work on order No. 100 begins at 5:12 P.M., and ends at 6:30. Lines are drawn under the nearest six-minute interval to the beginning and ending times and carried across beneath the figures in the next column. The first column gives the beginning and ending time; the second column by a simple calculation gives the elapsed time. This time in hours and tenths is determined by deducting the figures opposite the starting time in the second column from those opposite the
+
+TIME AND PAY RECORDS
+183
+
+![]() A blank time sheet form with various fields to fill out.
+FORM 24. INDIVIDUAL DAILY TIME SHEET - PRINTING PLANT
+
+
+
+ | NAME: |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+ |
+
+
+ | ORDER CUSTOMER OR NAME OF PUBLICATION |
+ DATE OF ORDER |
+ DATE OF PUBLICATION |
+ DAY OF WEEK |
+ AMOUNT (DOLLARS) |
+ AMOUNT (CENTS) |
+ AMOUNT (DOLLARS) |
+ AMOUNT (CENTS) |
+ AMOUNT (DOLLARS) |
+ AMOUNT (CENTS) |
+
+
+
+
+
+
+
+
+
+ | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT | NIGHT
+ |
+
+
+
+
+
+
+FORM NO. 15-16-17-18-19-20-21-22-23-24-25-26-27-28-29-30-31-32-33-34-35-36-37-38-39-40-41-42-43-44-45-46-47-48-49-50-51-52-53-54-55-56-57-58-59-60-61-62-63-64-65-66-67-68-69-70-71-72-73-74-75-76-77-78-79-80-81-82-83-84-85-86-87-88-89-90
+![]() A blank time sheet form with various fields to fill out.
+
+184
+
+LABOR COSTS
+
+ending time. Thus 0.2 deducted from 1.5 gives 1.3 hours to be charged to order No. 100 for composition --- as would be checked in the column so headed.
+
+In the spaces provided on the right side of the form the gate time is stamped by means of a clock stamp and the total hours worked are entered in the space at the right-hand upper corner. Thus the time to be entered on the pay-roll, which can be seen at a glance, is distinguished from the time chargeable to orders, and one entry checks the accuracy of the other.
+
+By changing the headings in the columns of Form 24 this time sheet can be adapted to meet the conditions of almost any job order establishment.
+
+6. Piece-Work Records
+
+Forms for recording the labor cost of piece-work cannot be standardized to the degree possible with time-keeping records. The conditions under which piece-work is carried on, and the method of inspection and payment to some extent determine the design of the forms used. In many cases a piece-work card or slip,
+
+
+
+ | N° |
+ 1 |
+ Pay for this work |
+ as |
+ TEN CENTS A DOZEN |
+
+
+ | To |
+ |
+ Lot No. |
+ |
+ Lot No. |
+
+
+ | Style |
+ |
+ No. of Pieces |
+ |
+ No. of Pieces |
+
+
+ | Date In |
+ |
+ Date Out |
+ |
+ Date In |
+
+
+ | This slip must be filed into the package and returned with the work. |
+
+
+
+Earl & Wilson
+
+Form 25. Piece-Work Slip
+
+TEAR OFF
+this coupon and
+return to your pay envelope
+Earl & Wilson
+
+TIME AND PAY RECORDS 185
+
+recording quantity and price, may also be designed to serve as a receipt for work done or even as a voucher for payment of wages to the employee. For this purpose the piece-work slip or card is made in coupon form. The coupon is detached when the work is completed and retained by the employee as a receipt for work done and as a check on the amount in his pay envelope.
+
+A simple form of piece-work slip is shown in Form 25. The information it records is self-explanatory and the convenience of the coupon feature is equally apparent. The body of the card goes to the accounting department for use in making up the pay-roll and in determining the labor charge to orders. The coupon is retained by the employee as a receipt for work done, to be used in case of any question as to the wages due him.
+
+A more elaborate use of the coupon feature is shown in Form 26. This type of record is especially suitable for a factory routine in which the unit of production passes through a number of hands before the round of operations performed upon it is completed. The form shown is used in the cloak and suit industry and represents a tag which is attached to a garment when operations are paid for by the piece. The operations are listed and numbered from the bottom upward in their sequence of manufacture and in coupon form, so that the coupons when detached and checked by the foreman in charge serve as a voucher for the payment of wages. The numbered squares in the center of the tag are used to place responsibility for defective work—by the simple expedient of entering the clock numbers of the workers in the squares which correspond in number with the coupon for the operations performed.
+
+186
+LABOR COSTS
+
+EMPLOYEE'S PIECE-WORK COUPON
+
+
+
+ | THE A.B.CO. |
+ Date |
+
+
+ | Butcher(s) |
+ Soft Roll |
+ |
+
+
+ | D.S. |
+ |
+ |
+ Lap Sear |
+ |
+ |
+ 3.5. |
+ |
+ |
+
+
+ | Style |
+ 50k |
+
+
+ |
+ 1 |
+ 5 |
+ 9 |
+ 13 |
+ 17 |
+ 21 |
+
+
+ |
+ 2 |
+ 6 |
+ 10 |
+ 14 |
+ 18 |
+ 22 |
+
+
+ |
+ 3 |
+ 7 |
+ 11 |
+ 15 |
+ 19 |
+ 23 |
+
+
+ |
+ 4 |
+ 8 |
+ 12 |
+ 16 |
+ 20 |
+ 24 |
+
+
+
+As each workman detaches the coupon corresponding with the operation which he performs he must also enter his clock number in the proper space above.
+
+
+ | Description of Operation | Clock Number (Press) |
|---|
| Putting on the Cooker Cover | 24 |
|---|
| Pulling off the Cooker Cover | 25 |
|---|
| Cooking the Meat in the Cooker | 26 |
|---|
| Cooking the Meat in the Cloak | 27 |
|---|
| Cooking the Meat in the Cloak with a Presser | 28 |
|---|
| Cooking the Meat in the Cloak with a Presser and a Presser Handle | 29 |
|---|
Cooking the Meat in the Cloak with a Presser and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser Handle and a Presser
+
+TIME AND PAY RECORDS 187
+
+**7. Pay-Roll Records**
+
+The form of the pay-roll is determined by the length of the pay period, the system of paying wages (by the time or by the piece), and the details to be entered.
+Form 27 is a loose-leaf sheet designed to record both time and piece rates in an establishment manufacturing underwear, where the larger part of the work is paid for by the piece. The daily time is entered in the columns under "Day of Week." Overtime and piece-work appear in the next columns. Wages are distributed in the columns showing the manufacturing classifications, and from the total for the week any necessary deductions are made as indicated on the form. In the columns to the right of the form provision is made for calculating the different denominations of money needed to fill the pay envelopes. Non-productive labor is usually calculated on a separate pay-roll analysis sheet.
+
+The feature of Form 28 is the use of one permanent or "master" sheet and a number of shorter sheets so designed as to dispense with the rewriting of names week after week. The names of the workmen are written on the long sheet, which remains in the binder until the end of the year, or until changes among the employees necessitate its rewriting. A short sheet is inserted weekly. At the end of the year the binder is emptied and its contents are bound for future reference.
+
+Form 29 simplifies the pay-roll record by omitting names and listing merely employees' numbers and amounts due under the heads of productive and non-productive work in each department. The entries are made by means of an adding machine. This simplification of the pay-roll work can be carried out with safety.
+
+188
+LABOR COSTS
+
+FORM 97: Pay-Roll Record
+
+
+
+ | TIME AND PAY-ROLL |
+
+
+ | FOR THE WEEK ENDING |
+
+
+ | DAY OF WEEK |
+ STAFF NAME |
+ STAFF NO. |
+
+
+ | MON - TUE - WED - THU - FRI |
+ NAME |
+ NO. |
+
+
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+
+
+ |
+ |
+ |
+
+
+ | LAB RMS | BALANCE | EXPENSES | NET | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME | STAFF NO. | STAFF NAME |
+
+![]() A blank time and pay-roll form for labor costs, with space for staff names, staff numbers, and expenses. The form is labeled "Form 97: Pay-Roll Record". A small table below the main form shows sample data for LAB RMS, BALANCE, EXPENSES, NET, STAFF NO., and STAFF NAME columns. The top left corner has a small square with a circle in the center (O).
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+189
+
+Form 29. Pay-Bill Record (master sheet and short weekly direct)
+
+![]() A diagram showing a grid with various lines and annotations, including "Period," "Pay," "Time," "Employer's Sign," "Employee's Sign," and "Date." The diagram appears to represent payroll records.
+
+190 LABOR COSTS
+
+either under the process method or when shop time tickets are used as the basis of the record and shop time is checked in detail and in total against gate time and
+
+
+
+ | PAY-ROLL |
+
+
+ | Week Ending |
+ Department |
+
+
+ |
+ |
+ NON-PRODUCTIVE |
+ PRODUCTIVE |
+ TOTAL |
+
+
+ | No. |
+ Amount |
+ No. |
+ Amount |
+ No. |
+ Amount |
+
+
+
+Form 29. Pay-Roll Record—Simple Form
+
+against the current cost sheets as outlined in Chapter XIV, § 5.
+
+8. Pay-Roll Statements and Graphs
+
+The work of the cost accountant should include statements showing variations in cost as they occur from period to period. This is especially true when the factory is separated from the main office so that conditions
+
+TIME AND PAY RECORDS 191
+
+cannot be observed daily by the chief executives. The precise form of the statistical work will obviously be determined by the phases of the business in which the management at the time is most interested. There are, however, certain reports which should always be a matter of record in every business to which they are applicable. Thus, where the output is uniform it is always desirable to compile a statistical report at the close of each period showing the average labor cost per unit in each department, for comparison with corresponding records of previous periods.
+
+Graphs are frequently the best means of keeping the management informed of the current trend of factory operation or overhead. Form 30, for instance, shows by means of a graph a comparison between the average hourly rates earned by piece-workers and day-workers in a plant. An upward trend in the earnings of piece-workers up to November 22 is indicated on the chart, after which the piece-work begins to fall off.
+
+The graph shown in Form 31, which gives the ratio of non-productive to productive labor, is another valuable statistical record. Every factory has a dead line above which this ratio should not be allowed to pass. The changes from month to month or during any other period can be shown more quickly and more forcibly in the form of a graphic chart than in any other way. A study of the curves on the chart shows the monthly rise and fall of productive and non-productive labor. The points of particular interest to the management are the extent of these fluctuations and their comparison with those of former periods and especially the relation between the non-productive and productive labor.
+
+192
+
+LABOR COSTS
+
+Form 30. Chart showing Average Hourly Wage for Piece-Workers and Day-Workers
+
+![]()
+A line graph titled "LABOR COSTS" with two lines. The left line is labeled "SCC" and the right line is labeled "SCC". The x-axis ranges from 0 to 5, with tick marks at 0, 1, 2, 3, 4, and 5. The y-axis ranges from $0.00 to $0.25, with tick marks at $0.00, $0.05, $0.10, $0.15, $0.20, and $0.25.
+
+
+Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
+$0.00 $0.05 $0.10 $0.15 $0.20 $0.25
+
+TIME AND PAY RECORDS
+
+198
+
+Form BL Chart showing Productive and Non-Productive Labor and Ratio of Non-Productive to Productive Labor
+
+![]()
+A line graph titled "Time and Pay Records" shows the relationship between Productive Labor (PL) and Non-Productive Labor (NPL). The x-axis represents time in increments of 0.005, starting from 0.000 and going up to 0.035. The y-axis represents the number of units, ranging from 0 to 60,000.
+
+The line representing Productive Labor (PL) starts at approximately 60,000 units at the beginning of the graph and decreases gradually to around 2,000 units by the end. The line representing Non-Productive Labor (NPL) starts at around 4,000 units at the beginning of the graph and increases slightly before decreasing to around 2,500 units by the end.
+
+There is a legend indicating that the top line represents Productive Labor (PL) and the bottom line represents Non-Productive Labor (NPL).
+
+
+The x-axis values are:
+- 0.000
+- 0.005
+- 0.010
+- 0.015
+- 0.020
+- 0.025
+- 0.030
+- 0.035
+
+The y-axis values are:
+- 6,000
+- 7,000
+- 8,000
+- 9,000
+- 10,000
+- 11,000
+- 12,000
+- 13,000
+- 14,000
+- 15,000
+- 16,000
+- 17,000
+- 18,000
+- 19,000
+- 20,000
+- 21,000
+- 22,000
+- 23,577
+- 24,577
+- 25,577
+- 26,577
+- 27,577
+- 28,577
+- 29,577
+- 31,577
+
+The y-axis label is "Units."
+
+The x-axis label is "Time."
+
+194
+LABOR COSTS
+
+REVIEW QUESTIONS
+
+1. What methods are in use for obtaining a record of the elapsed time spent on jobs in job order factories?
+2. What mechanisms have been introduced to assist in obtaining accuracy in time records?
+3. Describe the procedure for obtaining the labor costs on jobs in a composing room of a job printery where compositors are paid by the day.
+4. What is meant by the decimal system of time reporting? What are its advantages and disadvantages?
+5. Describe a suitable form for checking piece-work payments.
+6. What use can be made of pay-roll statistics?
+
+CHAPTER XVI
+
+WAGE SYSTEMS
+
+1. Variations in Wage Systems
+
+Though the connection between a study of wage systems and cost accounting may not at first be apparent, sooner or later in the operation of every cost system the existing method of wage payment will be closely scrutinized and criticized with a view to its improvement. Especially is this so if the method in vogue is the old-time “day rate.” A primary object of every cost system is to increase production and lower costs, and to this end some incentive must be offered to workers. Under the day-rate method of wage payments, standard hourly and daily rates are paid for certain classes of work, the rates depending partly on the skill called for and partly on local labor conditions. But as the same rates are usually paid for the same class of work, regardless of differences of skill among men doing the same work, no incentive is offered to increase production. The man who works hard, who does his best, and shows more than average energy and productive capacity, receives the same reward as the man who works in a leisurely fashion and whose output is just sufficient to enable him to “hold his job.”
+
+That there are grave defects inherent in the use of the day-rate method of wage payment may be assumed from the fact that all recent methods of wage payment have been devised with a view to avoiding its worst fea- 195
+
+196
+LABOR COSTS
+
+ture—the “lack of incentive.” An incentive to do more and better work is offered to workers in various ways, ranging from the straight piece-work method of paying for quantity of output at a fixed rate, to the more complex premium systems which offer rewards on a sliding scale and on different bases for the quantity produced within a given time. It is necessary for the cost accountant to become familiar with the operation and comparative advantages of all these various modern methods of wage payment.
+
+Theoretically, the day-rate method should be used only in the case of routine workers when to be “on the job” during certain hours is of more importance than to do a set task or complete a certain amount of work. Foremen, inspectors, firemen, watchmen, and all workers who are engaged more in work of the nature of “mind-ing” or “tending” than in producing, must be paid by the day or week because of the nature of their occupation. In all other cases, where workers are occupied in producing something, means should be devised to increase the output of individuals by basing the payment on the output.
+
+2. Labor Costs under Day-Rate System
+
+It is not generally realized how widely output varies among men occupied with similar tasks when wages are paid on the dead level of the day-rate plan. The following calculation, which is based on an experimental investigation made in a plant about to change from day rates to a premium plan, shows that differences in labor cost of as much as 50% may exist where the day-rate plan is used.
+
+WAGE SYSTEMS 197
+
+EARNINGS UNDER THE DAY-RATE PLAN
+
+
+
+
+ | Operative |
+ Actual Time |
+ Rate per Hour |
+ Amount Earned |
+ No. of Pieces Produced |
+ Cost per Piece |
+
+
+ |
+ |
+ |
+ |
+
+
+
+
+ | No. 1 |
+ 100 min. |
+ 30 cts. |
+ 50 cts. |
+ |
+ 10 pcs. |
+ 5.0 cts |
+
+
+ | 2 |
+ 80 " 80 " |
+ 30 " 30 " |
+ 45 " 45 " |
+ 9 " 9" |
+ 5.0 " 5.0" |
+
+
+ | 3 |
+ 80 " 80 " |
+ 30 " 30 " |
+ 40 " 40 " |
+ 7 " 7" |
+ 5.7 " 5.7" |
+
+
+ | 4 |
+ 70 " 70 " |
+ 30 " 30 " |
+ 33 " 33" |
+ 6 " 6" |
+ 5.8 " 5.8" |
+
+
+ | 5 |
+ 60 " 60 " |
+ 30 " 30" |
+ 29 " 29" |
+ 5.6 " 5.6" |
+ |
+
+
+ | 6 |
+ 50 " 50 " |
+ 30 " 30" |
+ 23 " 23" |
+ 4.2 " 4.2" |
+ |
+
+
+ | 7 |
+ 40 " 40 " |
+ 30 " 30" |
+ 20 " 20" |
+ 4 " 4" |
+ 5.0 " 5.0" |
+
+
+ | 8 |
+ 30 " 30 " |
+ - - |
+ - - |
+ - - |
+ - - |
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+198
+LABOR COSTS
+
+trebled, usually to the surprise of those responsible for establishing the rates.
+
+A seeming advantage of the piece-rate plan is that it entails less supervision because idle operatives are automatically penalized. In practice, however, additional inspection is often required to see that no defective work is paid for. Care must be taken also to check the piece-workers' earnings in order to avoid paying twice for the same work. Inspection by foremen can sometimes be reduced by making each workman responsible for any defective work received from another. In this way each operative checks the work he receives it and a final inspection only is needed.
+
+A further advantage of the plan is that the manufacturer knows his labor cost before the goods are made. When he is asked to quote on a job, or when he is about to place a new article on the market, he can fix the selling price of the product with great accuracy. A contrasting disadvantage is that until experience has shown the actual capacity of an average willing workman, it is difficult to determine a rate which will be fair for all concerned—the employee, the employer, and the consumer.
+
+**4. Fixing the Piece Rates**
+
+A common experience in fixing piece rates is that of a certain hardware manufacturer. He no sooner had put into practice a straight piece-work system than he realized that he had fixed the rates too high. He explained his position in this way: "I fixed the rates with the expectation that employees would earn from a third to a half more. Before the rates had been established a
+
+WAGE SYSTEMS 199
+
+month, some employees had doubled their previous out-
+put and others, I learned, would have equalled them if
+they had not thought that the rate would be cut."
+
+Thus the adoption of piece rates often places the employer in a dilemma. "To make the change from day-
+to piece-work the rate must be acceptable to the majority of employees. If the rates in the first instance are set suf-
+ficiently high to make them acceptable to all workmen,
+including the laggards and the inefficient, the skillful and industrious employee frequently receives compensation that
+the employer considers disproportionate to the class
+of labor he is called upon to perform. If the rates are
+cut, employees naturally become dissatisfied and lose
+confidence in their employer's good faith. The prac-
+tice of reducing piece rates because of increased pro-
+duction has become so common that union workmen
+are often opposed to this plan of payment; or, where
+it prevails, they carefully restrict the output to some
+standard set by themselves. Yet experience shows that
+piece rates, when carefully fixed in the first instance,
+give good results under proper supervision. Home
+work is usually paid for at piece-work rates.
+
+"If the employer wishes to approximate maximum production, he must be prepared and willing to pay more than the previous day rate; and no piece-work plan will attain its object unless he takes that stand. If he can afford to pay a certain amount for the making of an article now, he can surely afford to pay the same amount per article when a larger number are produced per day; especially since the indirect expenses are in-
+creased comparatively little for an increased produc-
+tion in the same time, while, as these expenses are dis-
+
+199
+
+200 LABOR COSTS
+
+tributed over a larger number of articles produced, the cost of each article is proportionately decreased.**
+
+The determination of piece rates presupposes a knowledge of the technicalities of the trade and is thus outside the province of the cost accountant. In some industries the rates are established in conference between the manufacturer and the trade union representatives of employees. The price for a job is usually set from previous records and an average is struck between the capacities of the slowest and the most rapid workers.
+
+5. Differential Piece Rates
+
+A simple modification of the straight piece-rate plan is the “differential” piece rate by which varying degrees of skill and energy as reflected in different performances are recognized and rewarded. A standard of performance is set, and if this is attained and passed, the scale of pay ascends for every piece or dozen pieces made, as the case may be—as illustrated in the following section. The standard is based on the quantity that a conscientious worker of average skill may be expected to produce in a day. When an operative fails to reach this standard, the rates are so set that his pay is slightly less than he would have earned had he been working on a time or hourly basis. When, however, he reaches and passes the standard, the reward is liberal, gradually rising to 50% in excess of the possible earnings under the day rate. The more efficient the worker, the greater his reward, while the manufacturer can afford to pay on an ascending scale for increased production because by so doing he saves on indirect costs.
+
+*“Cost Accounting,” by Nicholson and Rohrbach, page 103.
+
+WAGE SYSTEMS 201
+
+"The differential piece-rate plan is specially devised to speed up production where the indirect expenses are high in proportion to material and labor costs. To get the best results in such a case the productive capacity must be made as effective as possible, even at a higher payment for labor cost. What is lost on the high piece rate will be more than made up by the distribution of the large amount of indirect expenses over an increased output.
+
+"The point of great importance in the differential piece-rate plan is the making of a fair rate at its introduction. An ill-judged rate at this time may be fatal and the utmost skill and judgment are necessary to guard against such a mistake. The plan also calls for a well-organized supervising corps, the actual increase of cost for this depending entirely on local conditions, the nature of the shop, and the organization."
+
+**6. Calculation of Differential Piece Rates**
+
+The following tables show the ascending scale of pay per piece when the minimum of 5 pieces within the hour is attained, for which the rate of pay is 3.5 cents per piece. The rate per piece rises one-tenth of a cent for each additional piece made within the hour.
+
+The rate per hour and the amount earned when 10 pieces are made within intervals of time varying from 100 to 30 minutes is shown below. It will be seen that the workman producing 10 pieces an hour is paid 4 cents for each piece or 40 cents an hour; a man turning out 10 pieces in 30 minutes or 20 pieces an hour receives 5 cents apiece or $1 an hour.
+
+"Cost Accounting," by Nicholas and Rohrbach, page 103.
+
+
+
+ |
+ Rate per Hour |
+ Amount Earned |
+
+
+ | 10 Pieces |
+ 3.5 cents |
+ 35 cents |
+
+
+ | 11 Pieces |
+ 3.6 cents |
+ 36.6 cents |
+
+
+ | 12 Pieces |
+ 3.7 cents |
+ 37.4 cents |
+
+
+ | 13 Pieces |
+ 3.8 cents |
+ 38.2 cents |
+
+
+ | 14 Pieces |
+ 3.9 cents |
+ 39 cents |
+
+
+ | 15 Pieces |
+ 4 cents |
+ 40 cents |
+
+
+
+![]() A table showing the calculation of differential piece rates.
+
+202
+LABOR COSTS
+
+EARNINGS UNDER THE DIFFERENTIAL PIECE RATE
+
+
+
+
+ | No. of Pieces per Hour |
+ Rate per Piece |
+ No. of Pieces per Hour |
+ Rate per Piece |
+
+
+
+
+ | 6 pcs. |
+ 3.6 cts. |
+ 15 |
+ 4.4 |
+
+
+ | T " 3.7 |
+ 15 |
+ 4.2 |
+
+
+ | 8 " 3.8 |
+ 17 |
+ 4.6 |
+
+
+ | 9 " 3.9 |
+ 17 |
+ 4.7 |
+
+
+ | 10 " 4.0 |
+ 18 |
+ 4.8 |
+
+
+ | 11 " 4.1 |
+ 19 |
+ 4.9 |
+
+
+ | 12 " 4.4 |
+ 20 |
+ 5.0 |
+
+
+ | 13 " 4.3 |
+ |
+ |
+
+
+
+
+EARNINGS UNDER THE DIFFERENTIAL PIECE RATE
+
+
+
+
+ | Oper-ative No. |
+ Actual Time No. of Pieces Made |
+ No. of Pieces per Hour |
+ Rate per Piece Earned Amount Earned per Hour Rate per Hour |
+
+
+
+ | No. of Pieces per Hour | No. of Pieces per Hour | No. of Pieces per Hour | No. of Pieces per Hour | No. of Pieces per Hour | No. of Pieces per Hour | No. of Pieces per Hour |
|---|
| No. 1 100 min. | 10 pcs. | 3.6 cts. | 36 cts. | 21.6 cts. | | | 2 90 min. | 10 pcs. | 3.7 cts. | 37 cts. | 24.6 cts. | | | 3 80 min. | 10 pcs. | 3.8 cts. | 38 cts. | 28.5 cts. | | | 4 70 min. | 10 pcs. | 3.9 cts. | 39 cts. | 33.4 cts. | | | 5 60 min. | 10 pcs. | 4.0 cts. | 40 cts. | 46.5 cts. | | | 6 50 min. | 10 pcs. | 4.2 cts. | 42 cts. | 50.4 cts. | | | 7 40 min. | 10 pcs. | 4.5 cts. | 45 cts. | 67.5 cts. | | | 8 30 min. | 10 pcs. | 50 cts. | 100.0 cts. |
|---|
+
+
+
+7. Premium Wage System
+
+A premium differs from a differential rate of pay in that the computation of the amount earned is based on time instead of on the quantity produced. The worker is rewarded in proportion to the time saved on a specific job or operation. The various premium systems in vogue differ in their mode of computing the value of the time saved, but the fundamental principle in all cases is the same, viz., to reward the efficient worker with a proportion of the value of the time saved. The saving in overhead should exceed the amount of the premium.
+
+![]() A table showing earnings under the differential piece rate system for various rates and hours worked.
+| No. | Actual Time | No. of Pieces Made | Rate per Piece | Amount Earned | Rate per Hour |
+|---|---|---|---|---|---|
+| No. 1 | 100 min | 10 pcs | 3.6 cts | 36 cts | 21.6 cts |
+| No. 2 | 90 min | 10 pcs | 3.7 cts | 37 cts | 24.6 cts |
+| No. 3 | 80 min | 10 pcs | 3.8 cts | 38 cts | 28.5 cts |
+| No. 4 | 70 min | 10 pcs | 3.9 cts | 39 cts | 33.4 cts |
+| No. 5 | 60 min | 10 pcs | 4.0 cts | 40 cts | 46.5 cts |
+| No. 6 | 50 min | 10 pcs | 4.2 cts | 42 cts | 50.4 cts |
+| No. 7 | 40 min | 10 pcs | 4.5 cts | 45 cts | 67.5 cts |
+| No. 8 | 30 min | 10 pcs | - | - | - |
+
+The table shows how earnings vary depending on the number of pieces made and the rate per piece, as well as the total amount earned and the rate per hour for each operating condition (time). For example, at a rate of $3.6 cents per piece, working for one hour would earn $36 cents ($36 = $3.6 x $1), while working for two hours would earn $72 cents ($72 = $36 x $2). Similarly, working for three hours would earn $54 cents ($54 = $36 x $1 + $36 x $1 + $36 x $1).
+
+WAGE SYSTEMS 203
+
+As an example of the working of the premium sys-
+tem, assume that job number 1 would ordinarily be in
+the shop 20 hours and be assessed for overhead at a uni-
+form hourly rate of 30 cents, making the burden on the
+job $10. Assume that in addition to the regular wage
+of 50 cents an hour, a premium of 25 cents an hour is
+offered for each hour saved under the standard time of
+20 hours.
+
+Under a day-rate system of 50 cents an hour the
+operator would finish the work in 20 hours and receive
+$10, and the employer would incur an overhead charge
+of $10. The total cost would thus be $20. Now as-
+sume that under the premium system the job is finished
+in 15 hours. The labor cost is then $7.50 plus a premium
+of, say, 25 cents for each of the 5 hours saved, or a total
+of $8.75. The overhead (at 50 cents an hour) is re-
+duced from $10 to $7.50, making the total labor and
+overhead $16.25 instead of $20, although wages are
+raised from 50 cents to 58 1/3 cents an hour—an increase
+of 16 2/3%.
+
+8. Calculation of Premium Wage System
+
+The accompanying tables show the computation of
+earnings when a premium of either 50% or 33 1/3%
+of the value of the wages saved is added to the opera-
+tive's regular hourly rate.
+These wage tables illustrate the effect on the cost per piece when the value of the time saved is shared in different proportions by employer and employees. Un-
+less the overhead of a department amounts to much more than the direct labor cost, it is financially impracticable to divide the time with the employee on a 50% basis. To
+
+204
+
+LABOR COSTS
+
+do so would be to increase the cost of production in favor of the employee. In departments where the overhead is low, only moderate rates of premium can economically be offered as incentives to efficiency.
+
+EARNINGS UNDER THE 50% PREMIUM SYSTEM
+Time allowance, 100 minutes. Rate per hour, 30 cents. Number of pieces produced, 10.
+
+
+
+
+| Operative |
+Actual Time |
+Time |
+50% Premium |
+Total Earnings |
+Rate per Hour |
+Rate per Piece |
+
+
+
+
+| No. 1 |
+100 min. |
+0 min. |
+0 cts |
+50 cts. |
+30.9 cts. |
+5.0 cts. |
+
+
+| 2 |
+80 |
+20 |
+5.0 |
+45.0 |
+22.5 |
+4.50 |
+
+
+| 3 |
+60 |
+20 |
+5.0 |
+45.0 |
+22.5 |
+4.50 |
+
+
+| 4 |
+70 |
+30 |
+7.5 |
+42.5 |
+36.4 |
+4.25 |
+
+
+| 5 |
+60 |
+40 |
+10.0 |
+40.0 |
+40.0 |
+4.00 |
+
+
+| 6 |
+50 |
+40 |
+10.0 |
+40.0 |
+40.0 |
+4.00 |
+
+
+| 7 |
+50 |
+60 |
+15.0 |
+37.5 |
+45.8 |
+5.78 |
+
+
+| 8 |
+40 |
+70 |
+17.5 |
+32.5 |
+65.9 |
+3.25 * |
+
+EARNINGS UNDER THE 33 1/3% PREMIUM SYSTEM
Time allowance, 100 minutes. Rate per hour, 30 cents. Number of pieces produced, 10. |
|---|
| Operative No. | Actual Time 100 min. | Time 0 min. | 33 1/3% Premium 16 1/3% | Total Earnings 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46.6 46. | Rate per Hour * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * | Rate per Piece ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** * |
|---|
| No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | No. | |
|---|
+
+9\. Task and Bonus System (Gantt System)
+
+Under the wage payment plans so far described, the incentive of extra earnings is so graduated that more
+
+WAGE SYSTEMS 205
+
+than the minimum wage can be earned without much effort. Under the task and bonus method a standard of attainment is set and no extra reward is paid unless it is reached. If it is attained the bonus then increases as the time set for the task is further reduced. The feature of this plan is that it offers a strong incentive to reach a predetermined standard of efficiency and surpass it, while at the same time it offers the man who fails only his regular hourly rate.
+
+**EARNINGS UNDER THE TASK AND BONUS SYSTEM**
+
+Bonus 40%. Rate 30 cents per hour. Number of pieces produced, 10. Standard time, 100 minutes.
+
+
+
+
+ | Operative |
+ Actual Time |
+ Bonus |
+ Total Earnings |
+ Rate per Hour |
+ Labor Cost per Piece |
+
+
+
+
+ | No. |
+ 170 min. |
+ 0 cts. |
+ 85 cts. |
+ 30 cts. |
+ 8.5 cts. |
+
+
+ | 2 |
+ 160 ** |
+ 0 ** |
+ 80 ** |
+ 30 ** |
+ 8.0 ** |
+
+
+ | 3 |
+ 150 ** |
+ 0 ** |
+ 75 ** |
+ 30 ** |
+ 7.5 ** |
+
+
+ | 4 |
+ 140 ** |
+ 0 ** |
+ 75 ** |
+ 30 ** |
+ 7.5 ** |
+
+
+ | 5 |
+ 130 ** |
+ 0 ** |
+ 65 ** |
+ 30 ** |
+ 6.5 ** |
+
+
+ | 6 |
+ 120 ** |
+ 0 ** |
+ 60 ** |
+ 30 ** |
+ 6.0 ** |
+
+
+ | 7 |
+ 110 ** |
+ 0 ** |
+ 55 ** |
+ 30 ** |
+ 5.5 ** |
+
+
+ | 8 |
+ 100 ** |
+ 0 ** |
+ 70 ** |
+ 62.5 ** |
+ 7.0 ** |
+
+
+ | 9 |
+ 90 ** |
+ 23 ** |
+ 68 ** |
+ 45.3 ** |
+ 6.8 ** |
+
+
+ | 10 |
+ 80 ** |
+ | | | | |
|---|
**
Earnings
(in cents) |
|---|
**
Labor
Cost
(in cents) |
|---|
| | | | |
|---|
**
Earnings
(in cents) |
|---|
**
Labor
Cost
(in cents) |
|---|
| | | | |
|---|
**
Earnings
(in cents) |
|---|
**
Labor
Cost
(in cents) |
|---|
| | | | |
|---|
**
Earnings
(in cents) |
|---|
**
Labor
Cost
(in cents) |
|---|
| | | | |
|---|
**
Earnings
(in cents) |
|---|
**
Labor
Cost
(in cents) |
|---|
| | | | |
|---|
**
Earnings
(in cents) |
|---|
**
Labor
Cost
(in cents) |
|---|
| | | | |
|---|
**
Earnings
(in cents) |
|---|
**
Labor
Cost
(in cents) |
|---|
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+```html
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+```
+```
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+206
+LABOR COSTS
+
+utes his regular rate of 30 cents an hour is increased by 40%, to 42 cents an hour. It will be observed that as soon as the standard is attained by the production of 10 pieces in 100 minutes, the labor cost per piece rises slightly—to fall again as the time in which 10 pieces are produced is decreased. The standard of attainment is usually fixed so high that an operative cannot earn more than a 40% premium. The slight increase in cost due to the bonus paid when the task is attained, is more than offset by the saving in overhead.
+
+10. Graduated Premium Wage System
+
+Instead of paying a round sum of either one-third or one-half the value of time saved, the premium can be so graduated that its rate increases in proportion to the time saved. The chief merit of this system is its flexibility and its justice to both employer and employee. Experience shows that it offers ample incentive to the worker to reduce the cost of production while the employer is protected by the fact that he receives full value for wages paid.
+
+The following table shows how earnings are computed. It will be noted that the worker who completes an operation in 80 minutes when the standard time is 100 minutes receives a premium of 20%. That is, if the standard rate is 30 cents an hour his earnings will be at the rate of 36 cents an hour. If he completes the job in 50 minutes, or half the standard time, he receives a premium of 50%, or an hourly rate of 45 cents. As the hourly rate increases the cost per piece decreases, as shown in the table. High rates of pay are thus offset with proportionately low production costs.
+
+
+
+
+ |
+ |
+ |
+
+
+
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+ |
+ |
+ |
+
+
+| Time (minutes) |
+Earnings (cents) |
+Rate (cents/hour) |
+
+
+| 80 |
+36 |
+36 |
+
+
+| 50 |
+45 |
+45 |
+
+
+| 40 |
+54 |
+54 |
+
+
+| 30 |
+63 |
+63 |
+
+
+| 20 |
+72 |
+72 |
+
+
+| 10 |
+81 |
+81 |
+
+
+| 5 |
+90 |
+90 |
+
+
+| 1 |
+99 |
+99 |
+
+
+ | | |
+
+
+| Total Time (minutes) | Total Earnings (cents) | Total Rate (cents/hour) |
+
+
+| 285 | 279.90 | 279.90 |
+
+
+ | | |
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+
+| Total Time (minutes) | Total Earnings (cents) | Total Rate (cents/hour) |
+
+
+| 360 | 360.00 | 360.00 |
+
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+ | | |
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+| Total Time (minutes) | Total Earnings (cents) | Total Rate (cents/hour) |
+
+
+| 435 | 435.90 | 435.90 |
+
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+ | | |
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+| Total Time (minutes) | Total Earnings (cents) | Total Rate (cents/hour) |
+
+
+| 510 | 510.90 | 510.90 |
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+```html
+...DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS - DRAFTING EXPENSE AND COST OF SALES TABLE FOR A DRAFTING SYSTEM - REPRESENTATIVE SYSTEMS
+
+PRODUCTION-CENTER JOB ORDER COSTS <page_number>327</page_number>
+
+To make up the balance sheet and profit and loss statement at the close of the period, the balances of the inventory accounts are set up on the balance sheet and the Cost of Sales account is closed out to the Profit and Loss account.
+
+REVIEW QUESTIONS
+
+1. What is the production-center method of cost-finding? How does it differ from other methods?
+2. What purpose is served by the machine expense account?
+3. Of what factors is machine expense composed?
+4. How are fictitious hours handled?
+5. How is overhead expense apportioned to jobs under the production-center method of cost-finding?
+6. Show the pro forma expense accounts affected by a distribution of expense in a production-center cost system.
+7. Is the production-center system adapted to an automobile manufacturing plant? If so, why?
+
+<img>A page from a book or report, with text discussing production-center job order costs.</img>
+
+CHAPTER XXV
+
+PROCESS COST SYSTEM—CLAY PRODUCTS
+
+1. Account Classification
+
+Cost-finding in all process plants or factories is based on the simple principle of segregating costs by processes. Department accounts are opened on the general ledger to collect the cost of those phases of productive activity which it is desirable to show separately in the financial or other periodical statements.
+
+In a plant or mine of considerable size the details of the general ledger accounts are usually recorded in a cost ledger in which separate accounts are, as a rule, opened to analyze and show in detail the items making up each general ledger account. Thus, to take an example from one of the extractive industries, the cost of copper mining is usually segregated on the general ledger under the heads of Underground Expense, Surface Expense, Hoisting, Transportation and Hauling, Stamping, Construction Work, and so on. “Underground Expense” in its turn is divided on the subsidiary ledger into Sinking, Drifting, Stoping, Timbering, and other technical mining operations. “Surface Expense,” “Hoisting,” and other expense items are similarly divided. Thus, the cost of any phase of the work is recorded in summary form in the general ledger and in detail in the cost ledger.
+
+The foregoing classification is used by an enterprise
+
+<page_number>328</page_number>
+
+PROCESS COST SYSTEM—CLAY PRODUCTS <page_number>329</page_number>
+
+with expenditures totaling millions of dollars annually and with hundreds of accounts. A small organization, of course, would not find it necessary to subdivide its accounts in this way. The subsidiary ledger might be dispensed with and entries be made direct to the general ledger process accounts from the purchase journal and pay-roll. Supporting documents to show the distribution of the fixed and other prepaid or accrued charges would then be all that was required to segregate costs by processes.
+
+2. Preliminary Information
+
+To illustrate the general method of process cost-finding, a system used in the clay products industry is presented in detail.* This system has been selected both because it is typical of the simple procedure of process cost-finding employed in the extractive industries and at the same time embodies the features of manufacturing as well as of mining.
+
+The operation of the system of cost-finding is complicated by the fact that, while the major part of the product is composed of a regular 9-inch brick, the cost of which can easily be averaged, orders are occasionally received for bricks of a special kind, the cost of which has to be separately computed. As it is impossible to keep the cost of the special kind separate from that of the common kind of brick through all the stages or processes of manufacture, means have to be devised to estimate this cost. Of course, if an order for a special type of product is large enough to employ the entire services of the plant for a definite period of time, as a week or
+
+*The system presented is substantially that used by the American Face Brick Association.*
+
+<img>A diagram showing a flowchart for process cost finding.</img>
+
+330 REPRESENTATIVE SYSTEMS
+
+more, the complication referred to no longer arises. But usually these special orders are included in the regular flow of production. The method of calculating the cost as shown here will be found suggestive as to the means to be employed in solving the chief and perhaps the only difficult problems of process cost-finding.
+
+**3. Production Details**
+
+The bricks regularly produced by the plant under consideration are made from clay and a certain proportion of broken bricks (technically known as “bats”) which are crushed and ground in the proportions of 3 or 2 of clay to 1 of bats, depending upon the grade of brick required. The clay is extracted from a clay pit or bank and the cost of this process is worked out on the ton basis. If the pit is leased a royalty per ton is usually paid; if owned by the manufacturer a depletion charge replaces the royalty charge.
+
+A certain amount of breakage takes place during the drying and burning processes, but the quantity of broken brick thus secured is not as a rule sufficient for the needs of the plant and therefore purchases are made from outside. An average cost per ton of the bats used in manufacture is figured from month to month and is shown separately in the final cost calculation.
+
+The cost of crushing and grinding is also computed on the ton basis, while the cost of the remaining processes (consisting of molding the regular bricks by machinery, or the special kinds by hand, and drying them in the tunnel preparatory to setting and burning them in the kiln) is computed per thousand bricks handled.
+
+When an order is received for bricks of a special
+
+PROCESS COST SYSTEM—CLAY PRODUCTS <page_number>381</page_number>
+
+kind, the cost of making the molds and molding the bricks by hand has to be computed separately, after which the cost of drying and burning the green brick is found by measuring the proportion of space occupied by the special brand on the floor of the drying tunnel and within the kiln.
+
+To illustrate, a standard size of kiln holds 140,000 9-inch bricks. Assuming that the kiln is charged with 120,000 9-inch bricks, that the cost of burning is $1,400 for the period, and that the rest of the space is occupied by 4,000 special bricks of a much larger size, these should obviously be charged with one-seventh of the burning cost—that is to say, with $200 which represents the cost of burning 20,000 9-inch bricks.
+
+**4. Daily Time Slip**
+
+Despite the fact that bricks are sometimes made to meet special requirements, no formal production orders are issued. Foremen are instructed as to what is required and thereafter the progress of production is reported day by day on the time slips shown in Form 22 (page 180).
+
+The mechanics who make the molds record their time against each job on these slips, crossing the starting time when they receive the job, and circling the stopping time when the job is finished. This furnishes the cost department with accurate information as to the length of time required to make molds which are to be charged to the customer, and also enables the proper amount of time to be charged against any particular shape for which special molds are being made.
+
+Hand molders also use one of these time slips
+
+332 REPRESENTATIVE SYSTEMS
+
+for each job. The quantity produced is recorded in the space for that purpose at the bottom of the slip. The slip shows the article or brand that is worked upon, together with the size. If a special job, its number as well as that of any blue-print or drawing is noted on the slip. The foreman of a machine gang uses one slip for all the men included in his gang. On the front he notes his own number and indicates the work which the gang is doing; on the back he notes the numbers of the workmen.
+
+This time slip enables the cost department to file the actual time consumed on either special or regular work and provides a record from which it is possible to bring out accurate individual costs on any shape of brick, no matter how difficult, and regardless of whether or not this particular shape has been made before. The quantity produced is in every case recorded in the proper space at the bottom of the form so that time can be checked with production. The production figures are used in making up daily and monthly production records for the use of the cost department.
+
+5. Setting and Drawing Reports
+
+Form 44 is a daily report of the number of bricks “set,” that is, placed in the kiln, and this report is handed in by the foreman of each setting gang. It records the name of the brand and other designations of the particular bricks set, the number of “green” or new pieces set, the number of imperfectly baked pieces which have been reset, and the date and hour when the gang started work. If it takes longer than one day to set the kiln, which happens in most cases, a report is handed in daily and on the last report is given the time finished.
+
+PROCESS COST SYSTEM—CLAY PRODUCTS 333
+
+FORM 46. Kiln Drawing Report
+
+<table>
+ <tr>
+ <td colspan="2">DRAWING REPORT</td>
+ </tr>
+ <tr>
+ <td>No.</td>
+ <td>Date</td>
+ </tr>
+ <tr>
+ <td>Material No.</td>
+ <td>Order No.</td>
+ <td>Page No.</td>
+ </tr>
+ <tr>
+ <td>Quantity</td>
+ <td>Form No.</td>
+ <td>Page No.</td>
+ </tr>
+</table>
+
+<table>
+ <tr>
+ <td colspan="2">SETTING REPORT</td>
+ </tr>
+ <tr>
+ <td>No.</td>
+ <td>Min.</td>
+ <td>Max.</td>
+ <td>Min.</td>
+ <td>Max.</td>
+ <td>Min.</td>
+ <td>Max.</td>
+ </tr>
+ <tr>
+ <td>Product Code</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Product Name</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Event</td>
+ <td>Name</td>
+ <td>Cargo Number</td>
+ <td>Packing Sheet</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+</table>
+
+FORM 44. Brick Setting Report
+
+334 REPRESENTATIVE SYSTEMS
+
+After the bricks are burned and the gang starts drawing a kiln, a drawing report (Form 45) is operated in the same way as the setting report. These two reports are used to make up the kiln record, which, as will be shown presently, summarizes the production results of each kiln. These records do not enter into the cost accounting scheme, being purely administrative records.
+
+6. Daily Record of Production
+
+The gross production for the cost period is compiled on daily records of production (Form 46) which in their
+
+<table>
+ <tr>
+ <td>DAILY RECORD OF PRODUCTION</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>No.</td>
+ <td>Employee or Gang</td>
+ <td>Brand</td>
+ <td>Designation</td>
+ <td>No. Pieces</td>
+ <td>Weight</td>
+ <td>Cumulative</td>
+ </tr>
+ <!-- Additional rows can be added here -->
+</table>
+
+Form 46. Daily Brick Production Record
+
+turn are summarized on a monthly report. The daily record is made up from the quantities reported by hand and machine molders on the daily time slips, as already explained. The monthly record summarizes the same
+
+PROCESS COST SYSTEM—CLAY PRODUCTS 835
+
+information as to the number of pieces and the weight of the different brands.
+
+7. Daily Record of Broken Bricks
+
+The net production of bricks for the period is determined by deducting from the gross amount, as obtained from the daily record, the quantity broken during that
+
+<table>
+ <tr>
+ <td colspan="6">RECORD OF BROKEN BRICKS</td>
+ </tr>
+ <tr>
+ <td>Class</td>
+ <td>Total Burned</td>
+ <td>Broken</td>
+ <td>Gross Weight of Broken</td>
+ <td>Charge per Brick</td>
+ <td>Net Cost per Brick</td>
+ <td>Cost per 1000</td>
+ </tr>
+ <tr>
+ <td>9" Head</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Machine</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Other</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>- 3%</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Ch.</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+</table>
+
+Form 47. Daily Record of Broken Bricks
+
+period. This quantity is computed day by day on Form 47. At the end of the month the daily records are summarized on a similar monthly record which becomes the basis for computing the net cost per thousand to be charged, for breakage, to the cost of the good bricks produced—as will be shown in the final cost calculation.
+
+The gross cost of the broken bricks is computed by
+
+386 REPRESENTATIVE SYSTEMS
+
+multiplying the number of thousands by the price per thousand of perfect bricks (as shown later on the final cost sheet). This price includes material, labor, and expense up to the point where the bricks are set in the kiln. Obviously, the broken bricks are not worth their manufacturing or gross cost when used again as "raw material," for the reason that bats can be purchased in the market at much less than the manufacturing cost of the broken brick. Therefore, from the gross cost is deducted the proper value of the broken brick—a value based on the price that would have to be paid for bats of the same grade if purchased from outside sources. This leaves the "net cost of broken" as shown on the form. This net amount, which is manifestly one of the items of cost chargeable to the good bricks, is divided by the number of thousands of good bricks produced during the period to give the "breakage cost" per 1,000 as shown on the final cost sheet. Thus the business sells back to itself at a fair price the broken bricks, and charges production with the difference between the selling price of the by-product and the manufacturing cost incurred in its production.
+
+**8. Record of "Bats"**
+
+The price at which bats are charged in the final cost calculation is worked out in Form 48. This record states, in terms of tons, the quantity and value of the bats purchased from outside sources during the month and of the broken brick derived from manufacturing. To these figures any freight incurred and the cost of handling are added and the average cost per ton is figured for the month and to date. The average cost is
+
+<img>A table showing calculations related to representative systems.</img>
+
+PROCESS COST SYSTEM—CLAY PRODUCTS 337
+
+then used as the price for bats, as will be shown in the final cost figures later.
+
+BATS RECORD
+
+<table>
+ <tr>
+ <td></td>
+ <td>100% Bats</td>
+ <td>100% Bats</td>
+ <td>100% Bats</td>
+ <td>100% Bats</td>
+ </tr>
+ <tr>
+ <td>Bats Purchased</td>
+ <td>144</td>
+ <td>145.00</td>
+ <td>145.00</td>
+ <td>145.00</td>
+ </tr>
+ <tr>
+ <td>Purchased</td>
+ <td></td>
+ <td>3.00</td>
+ <td>3.00</td>
+ <td>3.00</td>
+ </tr>
+ <tr>
+ <td>Rum Bats Purchased</td>
+ <td></td>
+ <td>155.00</td>
+ <td>155.00</td>
+ <td>155.00</td>
+ </tr>
+ <tr>
+ <td>Handling Labor</td>
+ <td></td>
+ <td>8.00</td>
+ <td>8.00</td>
+ <td>8.00</td>
+ </tr>
+ <tr>
+ <td>Total</td>
+ <td>144</td>
+ <td>166.00</td>
+ <td>166.00</td>
+ <td>166.00</td>
+ </tr>
+ <tr>
+ <td>Average Cost per Bat</td>
+ <td></td>
+ <td>1.22</td>
+ <td>1.22</td>
+ <td>1.22</td>
+ </tr>
+</table>
+
+Form 48. Monthly Bats Record
+
+9. Kiln Record
+
+As the setting, burning, and drawing reports are handed in, they are summarized on Form 49. This record serves several useful purposes. The difference between the "total equivalent in" and the "total equivalent out" represents the number of broken bricks resulting from the operation of this particular kiln. As the same men usually work on the same kiln, the records reflect the capacity of different gangs. The record serves also as a check on production in that the totals for all kilns must agree with the aggregate totals of the subsidiary records. Finally, brands of an irregular size, i.e., a
+
+338
+REPRESENTATIVE SYSTEMS
+
+KILN RECORD
+<table>
+ <tr>
+ <td colspan="2">CAPACITY OF EQUIVALENT</td>
+ <td colspan="2">TOTAL SET UP TIME (MIN)</td>
+ </tr>
+ <tr>
+ <td>Setting</td>
+ <td>Time</td>
+ <td>Time</td>
+ <td>Time</td>
+ </tr>
+ <tr>
+ <td>Brand</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ </tr>
+ <tr>
+ <td>Brand</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ </tr>
+ <tr>
+ <td>Brand</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ </tr>
+ <tr>
+ <td>Brand</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ </tr>
+ <tr>
+ <td>Brand</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ </tr>
+ <tr>
+ <td>Brand</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ </tr>
+ <tr>
+ <td>Brand</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ </tr>
+ <tr>
+ <td>Brand</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ </tr>
+ <tr>
+ <td>Brand</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ </tr>
+ <tr>
+ <td>Brand</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ </tr>
+ <tr>
+ <td>Brand</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ </tr>
+ <tr>
+ <td>Brand</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ <td>Set Up Time</td>
+ </tr>
+ <tr>
+ <th colspan="4">Form #0 - Kiln Record</th>
+ </tr>
+</table>
+
+<page_number>S.</page_number>
+
+<img>A form titled "Kiln Record" with columns for setting, time, and total set up time for various brands.</img>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<page_number>S.</page_number>
+
+<watermark>Kiln Record Form #0 - Kiln Record - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S. - S.
+
+PROCESS COST SYSTEM—CLAY PRODUCTS 339
+
+size other than the standard 9-inch, are reduced to their equivalent in the regular 9-inch size and shown in the "total in," "total out," and "broken" columns. The figures thus indicate whether or not the kiln has been operated to its full capacity and how one burning compares with another in efficiency.
+
+10. Financial Records
+
+The forms so far described which are peculiar to the brick manufacturing industry are used primarily for the purpose of gathering information concerning the kind and quantities of brick produced. As to financial records, there are two which are common to all industries and which play an important part in segregating costs by processes. These are the pay-roll and the voucher record or purchase journal.
+
+A very simple kind of pay-roll is all that is required in the ordinary brick plant. Form 50a is usually sufficient. Three columns are ruled to show the weekly wage, piece-rate earnings, and total pay of employees. Names are listed by departments. The salaries of officials and clerical employees who cannot be allocated to any particular department come under the head of administrative expense, the distribution of which will be shown later. At the end of the cost period the Pay-Roll account is credited with the labor charges to departments.
+
+The standard form of voucher record is used ordinarily in brick plants and is an important feature of the cost system. So far as is practicable, expenditures are classified at their source by allotting one column in this record to every department which has been made a cost
+
+340
+REPRESENTATIVE SYSTEMS
+
+FORM 50. (a) Pay-Roll Record-Brick Manufacturing Plant
+
+<table>
+ <tr>
+ <td>NO.</td>
+ <td>NAME</td>
+ <td>RATE</td>
+ <td>PERCENTAGE</td>
+ <td>TOTAL PAY</td>
+ <td>DEDUCTION</td>
+ <td>TOTAL NET</td>
+ <td>REMARKS</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+</table>
+
+<img>A blank Pay-Roll form with columns for NO., NAME, RATE, PERCENTAGE, TOTAL PAY, DEDUCTION, TOTAL NET, and REMARKS.</img>
+
+**PROCESS COST SYSTEM—CLAY PRODUCTS** <page_number>341</page_number>
+
+division. Expenditures which cannot be departmentalized on the register, such as taxes and insurance or the purchase of a plant asset, are entered in a "Sundry" column. The operation and ruling of the voucher register and the purchase journal have already been explained in Volume I of "Business Accounting." The point to note here is that all expenditures other than those for wages and for items paid for in cash or its equivalent are first recorded in the voucher record.
+
+**11. Fixed Charges Sheet**
+
+An illustration of a fixed charges schedule is given in Form 506 (page 342). The left-hand page of the form shows an analysis of the investment in lands, buildings, and equipment and the apportionment of their values among departments. Only in the case of rent or the maintenance and up-keep of building is the apportionment based on floor space; in the other cases values are taken into consideration. Thus, while the crushing and grinding department occupies 4% of the floor space of the plant, it is assigned only 1% of the value of the buildings by reason of its being located in an inexpensive frame structure. Appraised values as well as the actual space occupied are thus taken into consideration.
+
+The distribution of the fixed charges is shown on the right-hand page. The percentages of depreciation estimated for each department are applied to the appraised values shown in the left part of the form. Taxes are apportioned according to the percentages worked out in the column headed "Total Buildings and Equipment"; insurance is distributed according to the percentages shown under the headings "Buildings" and
+
+<img>A scanned page from a book, specifically page 341, titled "PROCESS COST SYSTEM—CLAY PRODUCTS," with text discussing fixed charges sheet and process cost system.</img>
+
+342 REPRESENTATIVE SYSTEMS
+
+**FIXED CHARGES SHEET**
+
+| Densities | Flow Rate | Balance of Investment | Total Investment | Total Investment | Total Investment | Total Investment | Total Investment |
+|---|---|---|---|---|---|---|---|
+| **Densities** | **Flow Rate** | **Balance of Investment** | **Total Investment** | **Total Investment** | **Total Investment** | **Total Investment** | **Total Investment** |
+| 0.000 | 5000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 |
+| 1.5% | 25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 |
+| 3.5% | 17,500 | $17,500 | $17,500 | $17,500 | $17,500 | $17,500 | $17,500 |
+| 6.5% | 8,750 | $8,750 | $8,750 | $8,750 | $8,750 | $8,750 | $8,750 |
+| 13.5% | 4,375 | $4,375 | $4,375 | $4,375 | $4,375 | $4,375 | $4,375 |
+| 26.5% | 2,187.5 | $2,187.5 | $2,187.5 | $2,187.5 | $2,187.5 | $2,187.5 | $2,187.5 |
+| 46.5% | 1,193.75 | $1,193.75 | $1,193.75 | $1,193.75 | $1,193.75 | $1,193.75 | $1,193.75 |
+| 66.5% | 696.875 | $696.875 | $696.875 | $696.875 | $696.875 | $696.875 | $696.875 |
+| 96.5% | 348.4375 | $348.4375 | $348.4375 | $348.4375 | $348.4375 | $348.4375 | $348.4375 |
+
+**Fixed Charges Sheet**
+
+| Fixed Charges Sheet - Approval of Charge Sheet |
+|---|
+| Fixed Charges Sheet - Approval of Charge Sheet |
+| Fixed Charges Sheet - Approval of Charge Sheet |
+| Fixed Charges Sheet - Approval of Charge Sheet |
+| Fixed Charges Sheet - Approval of Charge Sheet |
+| Fixed Charges Sheet - Approval of Charge Sheet |
+| Fixed Charges Sheet - Approval of Charge Sheet |
+| Fixed Charges Sheet - Approval of Charge Sheet |
+
+Forms 86 (b) Schedule of Fixed Charges-Brick Manufacturing Plant
+
+**PROCESS COST SYSTEM—CLAY PRODUCTS** <page_number>343</page_number>
+
+"Equipment," and interest on investment according to the percentages shown under "Total Investment." After the annual department charge is worked out in this way the charge for a cost period of any length can readily be determined. In the last column of Form 50b the fixed charges are shown for periods of four and five weeks.
+
+**12. Cost Ledger**
+
+The cost ledger is composed of loose-leaf sheets so ruled as to show the figures for the current month and the cumulative figures for the year. (See Forms 51-53.) Each sheet contains a sufficient number of columns for six months. The distribution of the two service departments, administration and power—as illustrated by Form 51—is worked out for each month; and the "cost per ton" or "per thousand," as the case may be, is figured below the entries on the process cost sheets. This book therefore contains in great detail all the information as to costs required by the management.
+
+Accounts on the general ledger are carried with each process department for the purpose of charging Finished Goods account with the cost of the production for the period. In the process accounts on the general ledger the comparative figures and other details shown on the cost ledger are, of course, omitted. The control of the cost ledger is effected by comparing the cost of the finished goods as shown on the general ledger with the figures derived by multiplying the current cost of brick per thousand (as worked out in the final cost calculation in § 15) by the number of thousand bricks produced during the period.
+
+<img>A page from a book titled "PROCESS COST SYSTEM—CLAY PRODUCTS" showing a table or chart.</img>
+
+344 REPRESENTATIVE SYSTEMS
+
+**13. Service Departments**
+
+In the average brick plant, power and administrative expenses cover the services rendered production.
+
+<table>
+ <thead>
+ <tr>
+ <th>ADMINISTRATIVE</th>
+ <th>MONTH OF JULY</th>
+ <th>YEAR TO DATE</th>
+ </tr>
+ </thead>
+ <tbody>
+ <tr>
+ <td>Executive Salaries</td>
+ <td></td>
+ <td>$800.00</td>
+ </tr>
+ <tr>
+ <td>Office Salaries</td>
+ <td></td>
+ <td>150.00</td>
+ </tr>
+ <tr>
+ <td>Office Expense</td>
+ <td></td>
+ <td>41.50</td>
+ </tr>
+ <tr>
+ <td>Telephone and Telegraph</td>
+ <td></td>
+ <td>23.40</td>
+ </tr>
+ <tr>
+ <td>Postage</td>
+ <td></td>
+ <td>83.10</td>
+ </tr>
+ <tr>
+ <td>Utilities</td>
+ <td></td>
+ <td>5.25</td>
+ </tr>
+ <tr>
+ <td>Insurance and Taxes on Office</td>
+ <td></td>
+ <td>9.75</td>
+ </tr>
+ <tr>
+ <td>Depreciation on Office</td>
+ <td></td>
+ <td>3.00</td>
+ </tr>
+ <tr>
+ <td>Total Monthly Expense.</td>
+ <td></td>
+ <td>$768.00</td>
+ </tr>
+ <tr>
+ <td>Less Charge to Distributing 25%</td>
+ <td></td>
+ <td>192.00</td>
+ </tr>
+ <tr>
+ <td>Charge to Works.</td>
+ <td></td>
+ <td>$576.00</td>
+ </tr>
+ <tr>
+ <td>Administrative</td>
+ <td></td>
+ <td>$376.00</td>
+ </tr>
+ <tr>
+ <td>Superintendent</td>
+ <td></td>
+ <td>200.00</td>
+ </tr>
+ <tr>
+ <td>Watchman</td>
+ <td></td>
+ <td>65.00</td>
+ </tr>
+ <tr>
+ <td>Total to Works.</td>
+ <td></td>
+ <td>$841.00</td>
+ </tr>
+ </tbody>
+</table>
+
+Distribution:
+Crushing and Grinding 10% $ 84.10
+Machine-Made Brick 10% 84.10
+Tunnel Drying -
+Hand Molding, 9 inch 20% 168.20
+Shape Molding 25% 210.25
+Hot Floor Drying -
+Setting 10% 84.10
+Burning 10% 84.10
+Shipping and Labor 15% 126.15
+
+Form 81 Cost Ledger-Administrative Account
+
+**PROCESS COST SYSTEM—CLAY PRODUCTS** <page_number>345</page_number>
+
+Unless it is desired to subdivide office and other miscellaneous expenses under different heads, all such items are charged to the administrative department. A portion of this expense is usually allocated to the selling or distributing department (as shown on page 344) if the manager and office force devote part of their time to this end of the business. The total works expense for the period is apportioned over the process departments on the basis of the number of men employed in each. The cost ledger entries on pages 344 and 346 illustrate the customary procedure.
+
+Power expense is handled in the same way but the distribution, of course, is made only to the departments utilizing power and in proportion to their estimated consumption.
+
+**14. Process Accounts**
+
+The process accounts on the cost ledger are debited with their share of the fixed charges as shown on the schedule of fixed charges (Form 50b), with the labor as shown on the pay-roll, with purchases of supplies and repair parts as taken from the voucher register, and with the estimated cost of heat or power. These entries cover all the items of cost. In a small brick plant, or any process factory of small size, minor repairs are usually carried out by the "handy man" of the department, or perhaps by a mechanic from the power house; major repairs are turned over to an outside agency. In the latter case, repair expense can be charged direct from the voucher register. In the same way, supplies can be charged either to the department requisitioning them or, if they are for the general use of several depart-
+
+<img>A page from a book or report showing a table titled "Process Cost System—Clay Products." It includes columns for various costs and expenses, such as "Fixed Charges," "Labor," "Supplies," "Repair Parts," "Heat," and "Power." There are also rows for different departments or processes, with corresponding amounts listed under each category.</img>
+
+# 846 REPRESENTATIVE SYSTEMS
+
+ments, the invoice cost can be proportionately divided.
+In a large organization it would be necessary to operate stores and repair departments, and allocate the expense by means of stores requisitions and standing order cost sheets.
+
+<table>
+ <tr>
+ <td>Cost of Clay</td>
+ <td>Month of July</td>
+ <td>Year to Date</td>
+ </tr>
+ <tr>
+ <td>Royalties</td>
+ <td>$ 10.40</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Labor</td>
+ <td>149.40</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Miscellaneous Supplies</td>
+ <td>10.20</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Freight</td>
+ <td>48.10</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Hauling</td>
+ <td>41.90</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Total Cost.</td>
+ <td></td>
+ <td>$260.00</td>
+ </tr>
+ <tr>
+ <td>Total Tons Clay</td>
+ <td></td>
+ <td>1,040</td>
+ </tr>
+ <tr>
+ <td>Cost per Ton.</td>
+ <td></td>
+ <td>$ 0.25</td>
+ </tr>
+</table>
+
+<table>
+ <tr>
+ <td>MACHINE DEPT.</td>
+ <td>Month of July</td>
+ <td>Year to Date</td>
+ </tr>
+ <tr>
+ <td>Labor</td>
+ <td>$292.09</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Repairs to Machines.</td>
+ <td>31.20</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Supplies</td>
+ <td>11.50</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Share of Administrative</td>
+ <td>84.10</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Share of Sales</td>
+ <td>20.00</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Share of Fixed Charge</td>
+ <td>85.29</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Total Operating Cost.</td>
+ <td></td>
+ <td>$932.09</td>
+ </tr>
+ <tr>
+ <td>Production</td>
+ <td></td>
+ <td>700,000</td>
+ </tr>
+ <tr>
+ <td>Cost per 1,000.</td>
+ <td></td>
+ <th>$ 1.83</th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><th></th><br/></tr><br/>
+<br/>
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+<form_82_cost_ledger_process_accounts_1_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_0_62_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_accounts_form__82_cost_ledger_process_account
+
+PROCESS COST SYSTEM—CLAY PRODUCTS <page_number>347</page_number>
+
+As one process cost account is much like another, two examples will suffice to illustrate their operation—one showing the cost per ton of the clay produced and the other the cost per thousand of the machine process of brick molding. It is apparent that until the clay and bats are crushed and ground, and take form and shape, the cost cannot be computed in thousands. For this reason some processes are computed by the ton and others by the thousand.
+
+**15. Summary of Cost**
+
+The make-up of the final cost calculation is simple. As already noted, the unit of production is 1,000 9-inch bricks and 4,000 of these weigh approximately one ton. Therefore, when computing the final cost, the 3 tons of clay and the 1 ton of bats composing the 4 tons of clay and bats—the raw material of the product—are priced at their unit costs, and these costs are entered on the page of the cost ledger devoted to an analysis of the cost of brick. The unit or basic costs of the remaining processes are added thereto to give the “works cost” which is also the price at which broken brick shall be charged back to the factory. To this price are then added the expenses of handling and shipping the product and the expense incurred by breaking, giving the total factory cost per thousand as shown on page 348.
+
+The correctness of these figures, as already stated, can be proved by multiplying the number of thousand bricks produced during the period (irregular shapes being reduced to their 9-inch equivalents) by the total factory cost. The result should equal the amount deb-
+
+<img>A page from a book with text discussing process cost systems for clay products.</img>
+
+348 REPRESENTATIVE SYSTEMS
+
+<table>
+ <tr>
+ <td>TOTAL COST OF 9-INCH MACHINE BRICK</td>
+ <td>MONTH OF JULY</td>
+ </tr>
+ <tr>
+ <td>3 tons Clay at 25 cents.</td>
+ <td>$ .75</td>
+ </tr>
+ <tr>
+ <td>1 ton Bats at $1.31.</td>
+ <td>1.31</td>
+ </tr>
+ <tr>
+ <td>Crushing and Grinding, 4 tons at 49 cents.</td>
+ <td>1.96</td>
+ </tr>
+ <tr>
+ <td>Machine Dept.</td>
+ <td>1.33</td>
+ </tr>
+ <tr>
+ <td>Tunnel Drying Dept.</td>
+ <td>2.74</td>
+ </tr>
+ <tr>
+ <td>Setting Dept.</td>
+ <td>.35</td>
+ </tr>
+ <tr>
+ <td>Burning Dept.</td>
+ <td>.90</td>
+ </tr>
+ <tr>
+ <td>Works Cost (Price of Broken)</td>
+ <td>$ .38</td>
+ </tr>
+ <tr>
+ <td>Shipping and Labor.</td>
+ <td>.51</td>
+ </tr>
+ <tr>
+ <td>Breakage Cost.</td>
+ <td>.24</td>
+ </tr>
+ <tr>
+ <td>Total Factory Cost.</td>
+ <td>$10.08</td>
+ </tr>
+</table>
+
+Form 55. Cost Ledger-Summary of Costs
+
+ited to Finished Goods account on the general ledger.
+The cost of special brands of an irregular shape can be proved by multiplying their equivalent in 9-inch bricks (as shown on the kiln record, Form 49) and comparing the result with the sum of the cost of the various processes.
+
+REVIEW QUESTIONS
+
+1. What type of cost system is adapted to extractive industries?
+2. What system of cost-finding is best suited to meet the needs of a manufacturer of clay products?
+3. How is time kept on work in a brick-making plant?
+4. What records of production should be kept in a brick factory?
+5. What process accounts are required in a brick-making plant and how are they operated?
+
+CHAPTER XXVI
+
+ESTIMATED COSTS
+
+1. Nature of Estimating Cost System
+
+An estimating cost system is a modification of a job order system. Instead of calculating costs on one or a group of like articles, costs are computed by lines or groups of different articles. The total costs of the group are then compared with those based on an estimate of the cost of each article or group of articles in the line. In other words, instead of separately computing the cost of each job, a number of jobs are combined. Total costs are then controlled by comparing them with those based on a careful analysis, made in advance, of what the components of the combination ought to cost. The estimated figures are based, when possible, on past performances. Sometimes the system is spoken of as predetermined job costs.
+
+The chief merit of the estimating method of cost-finding is that in certain cases satisfactory results can be obtained with much less clerical work and fewer forms than are needed to compute job order costs. While the estimated figures do not give the exact cost of each article made, this, as will be seen later, is unnecessary in certain lines of business. All that the system aims to do is to show the manufacturer how much profit (or loss) he has made on certain lines or groups as a whole, and the reason for any rise or fall in their cost of production. If the manufacturer wants more
+
+<page_number>30</page_number>
+
+350 REPRESENTATIVE SYSTEMS
+
+than this, if he desires to know the actual cost of certain articles in a particular line, he must apply the mechanism of a job order system to those particular articles. The estimating system is thus incomplete and is to be commended only under certain conditions, as discussed in the next section.
+
+2. Application of Estimating Cost System
+
+Cost-finding by means of estimates is in many instances the only practicable plan. The intrinsic value of the product may be so small, or one article may differ so slightly from another in the same line that the expense of figuring costs for each article becomes prohibitive. Take for example the manufacture of cheap jewelry. The lines, consisting of badges, scarf pins, rings, brooches, pendants, and the like, may be made in thousands of different styles and sold at hundreds of different prices. In such a case, detailed costs on each article are impracticable and unnecessary. The manufacturer is interested in the profit on a line as a whole, or on a number of new styles in a line. The cost of any single article is so small a fraction of the whole that it is not worth considering in detail. Also the selling price may be based as much upon appearance and popular demand as upon cost.
+
+Another example is the manufacture of notions. In this and analogous instances only the simplest of methods is practicable. The office staff will in many cases consist of a bookkeeper with possibly an assistant and one or two stenographers. These employees will have neither the time nor the necessary qualifications to attend to a complete cost system. Predetermined esti-
+
+<table>
+ <tr>
+ <td>350</td>
+ <td>REPRESENTATIVE SYSTEMS</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>than this, if he desires to know the actual cost of certain articles in a particular line, he must apply the mechanism of a job order system to those particular articles. The estimating system is thus incomplete and is to be commended only under certain conditions, as discussed in the next section.</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>2. Application of Estimating Cost System</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>Cost-finding by means of estimates is in many instances the only practicable plan. The intrinsic value of the product may be so small, or one article may differ so slightly from another in the same line that the expense of figuring costs for each article becomes prohibitive. Take for example the manufacture of cheap jewelry. The lines, consisting of badges, scarf pins, rings, brooches, pendants, and the like, may be made in thousands of different styles and sold at hundreds of different prices. In such a case, detailed costs on each article are impracticable and unnecessary. The manufacturer is interested in the profit on a line as a whole, or on a number of new styles in a line. The cost of any single article is so small a fraction of the whole that it is not worth considering in detail. Also the selling price may be based as much upon appearance and popular demand as upon cost.</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>Another example is the manufacture of notions. In this and analogous instances only the simplest of methods is practicable. The office staff will in many cases consist of a bookkeeper with possibly an assistant and one or two stenographers. These employees will have neither the time nor the necessary qualifications to attend to a complete cost system. Predetermined esti-</td>
+ </tr>
+</table>
+
+ESTIMATED COSTS <page_number>351</page_number>
+
+mates meet the needs of such a case equally as well as they meet the needs of a large manufacturing business producing a variety of styles in which the clerical expense of figuring costs in detail would be disproportionate to the value of the product.
+
+3. Use of the Estimating Cost System
+
+The estimate and test plan of cost-finding—as the estimating system is frequently called—gives satisfactory results only when productive labor is either paid for at piece rates or can be approximately calculated in advance, and when overhead expense does not vary widely from one period to another. Starting with these essential conditions (which are usually found in the industries just cited) the time tickets and other records generally handled by foremen or employees are dispensed with and costs are recorded directly on the books. To this end the output of the factory is divided into lines and accounts are opened with each line to collect the cost of material, labor, and overhead.
+
+The division of the product into lines must be determined from the facts of the case. The greater the similarity between the articles which compose a line, the more closely can the cost of any one article be estimated. Wide ranges in cost and selling price within a line may lead to the sale of some of the articles at a loss which has to be recouped by the profit made on other goods.
+
+It may be noted that as each new line involves the opening of three ledger accounts and the devising of means to keep the material, labor, and indirect expense of each line separately—expense is handled as a percentage of labor—the limits are soon reached at which
+
+<page_number>352</page_number>
+**REPRESENTATIVE SYSTEMS**
+
+practical results can be obtained by the use of an estimating cost system.
+
+**4. Basic Principles**
+
+It is apparent that the manufacturing expenditures made during a given period plus the beginning inventory and minus the closing inventory represent the cost of the goods sold during the period if both inventories are priced at the same figures. If now a count is kept of the quantities of goods produced by items and these items are priced at figures estimated to be their actual manufacturing cost, the opening inventory plus the expenditures for the period should equal the estimated cost of the quantities sold plus the closing inventory— if the estimated prices are correct. To illustrate, if the estimated cost of several lots of goods sold during a period totals $1,000, and the opening and closing inventories are alike, then the estimated cost of each lot may be considered to be correct if it is found that the manufacturing cost also equals $1,000 when the books are closed at the end of the period. If the manufacturing cost is more than $1,000, then the estimates were too low; if less, they were too high.
+
+The estimate and test plan of cost-finding is based on the foregoing simple principle. To condense the description of the method and to explain the book entries required in its operation, four schedules showing the sources of the figures for journalizing are given in the present chapter. For the sake of simplicity, figures and entries for one line only are given, it being of course understood that exactly the same procedure is followed when the output is divided into two or more lines.
+
+ESTIMATED COSTS <page_number>353</page_number>
+
+**5. Estimate of Cost**
+
+Much of the value of cost figures lies in a comparison of performances. When lines of goods closely resemble each other, past experience enables a close estimate to be made of the probable cost of a new line and past performances enable a close watch to be kept on the current cost of old lines. In this way standards are established and any serious deviation from them calls for instant investigation.
+
+In controlling costs by means of estimates the first step is to prepare an itemized statement of all expenses for the year and ascertain the proportion applicable to each cost period. As the figures are for the factory as a whole, this is a simple matter. The pay-roll is then analyzed to find the average cost of the productive labor for a given cost period and from these two sets of figures the average ratio of expense to direct labor can be determined. In factories producing lines of small intrinsic value the overhead will be comparatively low, ranging from 20 to 60%. In the illustrative schedules which follow, expense is assumed to be 50% of the direct labor cost.
+
+With this ratio determined, estimates can be compiled of the cost of each article in the different lines made. If work is paid for at piece rates the labor cost can be very closely estimated; but if paid for on hourly rates foremen must be consulted and asked to figure on this element. The material cost estimate should present no difficulty. The purchase price of material is a matter of record and therefore by weighing, or determining in some other way, the quantity of material used in the production of a certain number of articles and allowing
+
+<img>A page from a book with text discussing estimated costs.</img>
+
+354
+REPRESENTATIVE SYSTEMS
+
+for any scrap, a close estimate can be made. With the foregoing figures as a basis, a schedule is made out as shown below, giving each article or style in the line:
+
+Cost per Dozen Pairs of Line No. 1
+
+<table>
+ <thead>
+ <tr>
+ <th>Style No.</th>
+ <th>Material</th>
+ <th>Labor</th>
+ <th>Indirect Expense</th>
+ </tr>
+ </thead>
+ <tbody>
+ <tr>
+ <td>100</td>
+ <td>$1.00</td>
+ <td>$ .50</td>
+ <td>$0.25</td>
+ </tr>
+ <tr>
+ <td>110</td>
+ <td>1.25</td>
+ <td>.60</td>
+ <td>.30</td>
+ </tr>
+ <tr>
+ <td>120</td>
+ <td>1.50</td>
+ <td>.70</td>
+ <td>.35</td>
+ </tr>
+ <tr>
+ <td>130</td>
+ <td>2.00</td>
+ <td>1.00</td>
+ <td>.50</td>
+ </tr>
+ <tr>
+ <td>145</td>
+ <td>2.50</td>
+ <td>1.20</td>
+ <td>.60</td>
+ </tr>
+ <tr>
+ <td>160</td>
+ <td>3.00</td>
+ <td>1.40</td>
+ <td>.70</td>
+ </tr>
+ </tbody>
+</table>
+
+It should be noted that the above estimate is based on the unit of manufacture which may be a dozen, a gross, so many hundreds, or any other measure. It does not indicate the quantity to be manufactured. It merely gives the details of what is expected to be the material, labor, and overhead cost of certain articles in line No. 1 which are designated by their style number. These estimates are the backbone of the system and should be made with the greatest possible care.
+
+6. Opening Inventory
+Having estimated the cost of the items in the line, an inventory is taken for the purpose of opening the three ledger accounts kept with that line. The opening figures are obtained by extending and adding the estimated costs of the goods on hand of the line to be manufactured. Any work in process should be taken as representing a certain quantity of finished goods—if one-third finished, one-third the quantity; if one-half finished, one-half; and so on. Any raw material on hand of the kind used in the manufacture of the line,
+
+ESTIMATED COSTS 355
+
+should be valued and added to the footing of the material price column. In the example given, it is assumed for the sake of simplicity that there is no raw material on hand.
+
+OPENING INVENTORY
+
+<table>
+ <thead>
+ <tr>
+ <th>Quantity</th>
+ <th>Style No.</th>
+ <th colspan="2">Material</th>
+ <th colspan="2">Labor</th>
+ <th colspan="2">Indirect Expense</th>
+ </tr>
+ <tr>
+ <td>Dosen Pairs</td>
+ <td></td>
+ <td>Dosen Pairs</td>
+ <td>Total Dosen Pairs</td>
+ <td>Dosen Pairs</td>
+ <td>Total Dosen Pairs</td>
+ <td>Dosen Pairs</td>
+ <td>Total Dosen Pairs</td>
+ </tr>
+ </thead>
+ <tbody>
+ <tr>
+ <td>1,000</td>
+ <td>100</td>
+ <td>81.00</td>
+ <td>$1,000</td>
+ <td>80.50</td>
+ <td>$ 500</td>
+ <td>80.25</td>
+ <td>250</td>
+ </tr>
+ <tr>
+ <td>2,500</td>
+ <td>110</td>
+ <td>1.25</td>
+ <td>3,125</td>
+ <td>.60</td>
+ <td>L500</td>
+ <td>.30</td>
+ <td>750</td>
+ </tr>
+ <tr>
+ <td>5,000</td>
+ <td>130</td>
+ <td>.85</td>
+ <td>4,625</td>
+ <td>.30</td>
+ <td>L450</td>
+ <td>.15</td>
+ <td>750</td>
+ </tr>
+ <tr>
+ <td>2,500</td>
+ <td>130</td>
+ <td>1.25</td>
+ <td>4,625</td>
+ <td>1.00</td>
+ <td>4,625</td>
+ <td>.30</td>
+ <td>L1,385</td>
+ </tr>
+ <tr>
+ <td>1,250</td>
+ <td>145</td>
+ <td>.85</td>
+ <td>3,000</td>
+ <td>1.20</td>
+ <td>L440</td>
+ <td>.60</td>
+ <td>720</td>
+ </tr>
+ <tr>
+ <td>900</td>
+ <td>160</td>
+ <td>.85</td>
+ <td>2,760</td>
+ <td>1.40</td>
+ <td>L260</td>
+ <br/>
+ .70
+ </tr>
+
+ <!-- Total Row -->
+ <!-- Material -->
+ <!-- Labor -->
+ <!-- Indirect Expense -->
+ <!-- To General Ledger Account -->
+ </tbody>
+ <tfoot style="font-size: smaller;">
+ <!-- Total Row -->
+ <!-- Material -->
+ <!-- Labor -->
+ <!-- Indirect Expense -->
+ <!-- To General Ledger Account -->
+ </tfoot>
+ <!-- Total Row -->
+ <!-- Material -->
+ <!-- Labor -->
+ <!-- Indirect Expense -->
+ <!-- To General Ledger Account -->
+ <!-- Opening inventory. -->
+ <!-- (Opening inventory.) -->
+ <!-- Actual Manufacturing Cost -->
+ <!-- At the close of the period the expenditures for the three elements of manufacturing cost are summarized and debited to their proper accounts by journal entry as shown below. The sources of the figures are as follows: Assuming that work is paid for at piece rates, -->
+ <!-- $14,575.00 -->
+ <!-- $7,650.00 -->
+ <!-- $3,525.00 -->
+ <!-- $25,150.00 -->
+ <!-- (Opening inventory.) -->
+ <!-- Actual Manufacturing Cost -->
+ <!-- At the close of the period the expenditures for the three elements of manufacturing cost are summarized and debited to their proper accounts by journal entry as shown below. The sources of the figures are as follows: Assuming that work is paid for at piece rates, -->
+ <!-- $14,575.00 -->
+ <!-- $7,650.00 -->
+ <!-- $3,525.00 -->
+ <!-- $25,150.00 -->
+ <!-- (Opening inventory.) -->
+ <!-- Actual Manufacturing Cost -->
+ <!-- At the close of the period the expenditures for the three elements of manufacturing cost are summarized and debited to their proper accounts by journal entry as shown below. The sources of the figures are as follows: Assuming that work is paid for at piece rates, -->
+ <!-- $14,575.00 -->
+ <!-- $7,650.00 -->
+ <!-- $3,525.00 -->
+ <!-- $25,150.00 -->
+ <!-- (Opening inventory.) -->
+
+356 REPRESENTATIVE SYSTEMS
+
+the mechanism used in computing wages will serve also in segregating on the pay-roll the direct labor cost of the different lines. If wages are paid for at hourly rates, either productive employees must be segregated on the pay-roll by lines of work and foremen instructed to report the transfer of workers from one line to another, or a simple system of time-keeping must be devised to classify productive work by lines.
+
+The classification of raw material purchases by lines should be an equally simple matter. If, for example, materials of a certain kind, size, or quality are exclusively used in the manufacture of certain articles, these articles might with advantage be grouped into a separate line. The material cost of the various lines could then be classified at its source by allotting a column to each line in the purchase journal or voucher register.
+
+Overhead is charged to each line in proportion to the total labor cost at the percentage rate applied to the estimated figures. The following journal entry illustrates the bookkeeping procedure:
+
+<table>
+ <tr>
+ <td>Material Purchases</td>
+ <td>$158,825.00</td>
+ </tr>
+ <tr>
+ <td>Direct Labor</td>
+ <td>74,445.00</td>
+ </tr>
+ <tr>
+ <td>Indirect Expense</td>
+ <td>37,447.50</td>
+ </tr>
+ <tr>
+ <td>To General Ledger Account.</td>
+ <td>$265,717.50</td>
+ </tr>
+</table>
+
+8. Closing Inventory
+
+At the end of the period a closing inventory is prepared which in no way differs from the opening inventory excepting, of course, that the quantity of goods varies according to the tally. The following schedule and journal entry make clear the bookkeeping procedure:
+
+ESTIMATED COSTS 357
+
+CLOSING INVENTORY
+
+| QUANTITY | MATERIAL | LABOR | INDIRECT EXPENSE |
+|---|---|---|---|
+| Dozen Pairs | Spots No. | Dozen Pairs | Total | Dozen Pairs | Total | Dozen Pairs | Total |
+| 800 | 100 | $1.00 | $800 | $0.50 | $400 | $0.25 | $200.00 |
+| 1,200 | 110 | 1.25 | 1,500 | .60 | 750 | .30 | 360.00 |
+| 250 | 120 | 1.50 | 375 | .70 | 275 | .38 | 87.60 |
+| 500 | 145 | 2.50 | 1,250 | .60 | 750 | .60 | 450.00 |
+| 1,000 | 145 | 2.50 | 2,500 | .60 | 1,250 | .60 | 600.00 |
+| 750 | 160 | 2.25 | 1,625 | .70 | 1,375 | .70 | 925.50 |
+| | | | $6,425 | | $4,845 | | $9,225.50 |
+
+General Ledger Account. $14,499.50
+To Material... $8,425.00
+" Labor... ...$4,945.00
+" Indirect Expense... ...$2,922.50
+(Closing inventory.)
+
+9. Cost of Goods Sold
+
+So far three accounts—material, labor, and expense—have been charged with the current manufacturing cost of the line and the value of its opening inventory; they have also been credited with the value of the closing inventory. The balances of these accounts therefore represent the actual cost of the goods sold during the period, divided into its elements of material, labor, and expense. If now the estimated material, labor, and expense cost of the items of this line sold during the period is computed and the three accounts are then credited with the estimated figures, a credit balance in one or more of these accounts would indicate that the estimated elements of cost were too high; a debit balance would indicate that they were too low.
+
+358 REPRESENTATIVE SYSTEMS
+
+To furnish the necessary figures for these credit entries the quantity of each item sold is extended at its estimated price and the resulting figures are credited to their respective accounts, the offsetting debit being to the Cost of Goods Sold account. The accompanying schedule and journal entry illustrate the method:
+
+<table>
+ <tr>
+ <td>QUANTITY</td>
+ <td>STYLE No.</td>
+ <td>MATERIAL</td>
+ <td>Labor</td>
+ <td>Indirect Expense</td>
+ </tr>
+ <tr>
+ <td>Dosen Pairs</td>
+ <td>No.</td>
+ <td>Total Dosen Pairs</td>
+ <td>Total</td>
+ <td>Dosen Pairs</td>
+ <td>Total</td>
+ <td>Dosen Pairs</td>
+ <td>Total</td>
+ </tr>
+ <tr>
+ <td>10,000</td>
+ <td>100</td>
+ <td>$1.00</td>
+ <td>$10,000</td>
+ <td>$0.50</td>
+ <td>8,500</td>
+ <td>$0.25</td>
+ <td>$2,500</td>
+ </tr>
+ <tr>
+ <td>20,000</td>
+ <td>110</td>
+ <td>1.25</td>
+ <td>25,000</td>
+ <td>60</td>
+ <td>12,000</td>
+ <td>3.00</td>
+ <td>6,000</td>
+ </tr>
+ <tr>
+ <td>5,000</td>
+ <td>120</td>
+ <td>1.50</td>
+ <td>7,500</td>
+ <td>-7.0</td>
+ <td>3,500</td>
+ <td>-3.5</td>
+ <td>1,750</td>
+ </tr>
+ <tr>
+ <td>25,000</td>
+ <td>135</td>
+ <td>1.75</td>
+ <td>43,750</td>
+ <td>96.83</td>
+ <td>22,875</td>
+ <td>-96.83</td>
+ <td>11,438</td>
+ </tr>
+ <tr>
+ <td>15,000</td>
+ <td>145</td>
+ <td>2.50</td>
+ <td>37,500</td>
+ <td>129.69</td>
+ <td>18,750</td>
+ <td>-96.83</td>
+ <table><tbody><tr><th style="text-align: right;">Total:</th><th style="text-align: right;">$877,369.99</th></tr></tbody></table><table><tbody><tr><th style="text-align: right;">Cost of Goods Sold:</th><th style="text-align: right;">$276,235.69.99</th></tr></tbody></table><table><tbody><tr><th style="text-align: right;">Material:</th><th style="text-align: right;">$160,000.99.</th></tr></tbody></table><table><tbody><tr><th style="text-align: right;">Labor:</th><th style="text-align: right;">77,500.99.</th></tr></tbody></table><table><tbody><tr><th style="text-align: right;">" Indirect Expense:</th><th style="text-align: right;">$8,758.99.</th></tr></tbody></table>
+
+10. Factory Ledger
+
+After the foregoing journal entries have been posted to their proper ledger accounts, adjusting (i.e., closing) entries are made debiting or crediting, as the case may require, the Cost of Goods Sold account. If in making the adjustment it is necessary to charge material, this indicates that the cost estimates for material are too high. A corresponding credit adjustment is made to the Cost of Goods Sold account. If the adjust-
+
+ESTIMATED COSTS <page_number>359</page_number>
+
+ment calls for a credit to the Material account, this indicates that the estimates of material have been too low. A charge is then made to the Cost of Goods Sold account.
+The Labor and Indirect Expense accounts have to be adjusted in like manner and the amount of the adjustment shows to what extent the cost estimates are incorrect. When discrepancies from month to month indicate that the estimates of any elements of cost are too high or too low, they should be revised accordingly.
+
+After the adjustments have been made, the debit balance to Cost of Goods Sold account, into which the manufacturing accounts are closed, will obviously represent the total cost of all the articles of one particular line which have been made during the period. This balance is closed out to the Cost of Goods Sold account.
+
+FACTORY LEDGER ACCOUNTS
+
+<table>
+ <thead>
+ <tr>
+ <th>MATERIAL</th>
+ <th></th>
+ <th></th>
+ <th></th>
+ </tr>
+ </thead>
+ <tbody>
+ <tr>
+ <td>Jan. 1</td>
+ <td>Jan. 31</td>
+ <td>Cost of Goods Sold.</td>
+ <td>$160,000.00</td>
+ </tr>
+ <tr>
+ <td>Inventory</td>
+ <td>8,147,500</td>
+ <td>Inventory</td>
+ <td>8,425.00</td>
+ </tr>
+ <tr>
+ <td>Purchases</td>
+ <td>153,825</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Adjustment</td>
+ <td>25.00</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>$168,425.00</td>
+ <td></td>
+ <td>$168,425.00</td>
+ </tr>
+ </tbody>
+</table>
+
+<table>
+ <thead>
+ <tr>
+ <th>Labor</th>
+ <th></th>
+ <th></th>
+ <th></th>
+ </tr>
+ </thead>
+ <tbody>
+ <tr>
+ <td>Jan. 1</td>
+ <td>Jan. 31</td>
+ <td>Cost of Goods Sold.</td>
+ <td>$77,500.00</td>
+ </tr>
+ <tr>
+ <td>Inventory</td>
+ <td>8,736.00</td>
+ <td>Inventory</td>
+ <td>4,945.00</td>
+ </tr>
+ <tr>
+ <td>Direct Labor</td>
+ <td>74,445.00</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Adjustment</td>
+ <td>80.00</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>$81,545.00</td>
+ <td></td>
+ <td>$81,545.00</td>
+ </tr>
+ </tbody>
+</table>
+
+360
+REPRESENTATIVE SYSTEMS
+
+INDIRECT EXPENSE
+
+<table>
+ <tr>
+ <td>Jan. 1</td>
+ <td></td>
+ <td>Jan. 21</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Inventory</td>
+ <td>$ 3,252.00</td>
+ <td>Cost of Goods Sold</td>
+ <td>$38,750.00</td>
+ </tr>
+ <tr>
+ <td>Jan. 21</td>
+ <td></td>
+ <td>Inventory Adjustment</td>
+ <td>2,022.50</td>
+ </tr>
+ <tr>
+ <td>Indirect Expense</td>
+ <td>37,447.50</td>
+ <td>Adjustment</td>
+ <td>260.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td><strong>$40,972.50</strong></td>
+ <td></td>
+ <td><strong>$40,972.50</strong></td>
+ </tr>
+</table>
+
+<table>
+ <tr>
+ <td>Cost of Goods Sold</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Jan. 1</td>
+ <td></td>
+ <td>Jan. 21</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Material</td>
+ <td>$160,000.00</td>
+ <td>Adjustment on Material</td>
+ <td>$ 25.00</td>
+ </tr>
+ <tr>
+ <td>Jan. 31</td>
+ <td></td>
+ <td>Adjustment on Labor..</td>
+ <td>50.00</td>
+ </tr>
+ <tr>
+ <td>Labor</td>
+ <td>77,200.00</td>
+ <td>General Ledger.</td>
+ <td>276,375.00</td>
+ </tr>
+ <tr>
+ <td>Indirect Expense</td>
+ <td>38,250.00</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Adjustment on Indirect Expense</td>
+ <td>200.00</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td><strong>$876,450.00</strong></td>
+ <td></td>
+ <td><strong>$876,450.00</strong></td>
+ </tr>
+</table>
+
+The following journal entry is all that is necessary to effect the necessary adjustments in the accounts:
+Material, Adjustment............. $ 25.00
+Labor, Adjustment.................. 50.00
+To Cost of Goods Sold.............. $ 75.00
+Cost of Goods Sold................... 200.00
+To Indirect Expense, Adjustment.... 200.00
+
+11. General Ledger Account
+In an organization large enough to warrant the employment of a cost clerk, the manufacturing and expense accounts would as a rule be kept in the factory ledger controlled by one general ledger account. In a small organization all the accounts might be kept in the general ledger. In either case the general ledger account summarizes the costs of the line and controls the
+
+ESTIMATED COSTS <page_number>361</page_number>
+
+figures. As has been seen, this account is credited with the costs for the period when the manufacturing accounts are charged, and is debited with the value of the closing inventory. Therefore, its credit balance represents the actual cost of the goods made and sold and after the necessary adjustments have been made, should be in agreement with the debit balance of the Cost of Goods Sold—as shown below:
+
+<table>
+ <tr>
+ <td colspan="2">GENERAL LEDGER ACCOUNT</td>
+ </tr>
+ <tr>
+ <td>Jan. 1</td>
+ <td>Jan. 21</td>
+ </tr>
+ <tr>
+ <td>Inventory</td>
+ <td>Inventory</td>
+ <td>$ 14,492.50</td>
+ <td>$ 25,150.00</td>
+ </tr>
+ <tr>
+ <td>Jan. 31</td>
+ <td>Purchases, Material...</td>
+ <td></td>
+ <td>153,829.00</td>
+ </tr>
+ <tr>
+ <td>Cost of Goods Sold</td>
+ <td>Indirect Labor...</td>
+ <td></td>
+ <td>14,445.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>Indirect Expense...</td>
+ <td></td>
+ <td>37,447.50</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>$290,967.50</td>
+ <td>$290,967.50</td>
+ </tr>
+</table>
+
+12. Summary
+
+It will clearly be seen that the estimating method of cost-finding can be applied as readily to the manufacture of several lines as to the output of a small factory making only one line. In the first case the purchase journal and the pay-roll form must be arranged to analyze the material and labor cost; in the second case this analysis will not be necessary. In either case the simplicity of the system lies in the fact that it is not necessary to follow jobs (with their accompanying records) through the factory, or to segregate expense by departments for the purpose of computing separate burden rates.
+
+If at the close of the period the cost of goods sold is found closely to approximate the actual costs, the
+
+362 REPRESENTATIVE SYSTEMS
+
+estimates of the cost of each unit in the line can be accepted as correct. The object of the system is, of course, not so much to ascertain unit costs as to control the elements of cost of different lines so that an increase of any kind will at once be noted. When, for example, overhead is estimated for the ensuing period, item by item, and actual expenditure is compared with estimated expenditure at the close of the period, this comparison constitutes an important check. A rise in overhead which cannot be explained indicates waste or inefficiency. The same consideration applies to material and labor costs. What the figures ought to be can be estimated very closely and with this estimate as a standard of performance effort can be directed to further improvement.
+
+REVIEW QUESTIONS
+
+1. What is an estimating cost system? Under what conditions can good results be obtained from estimated costs?
+2. Would an estimating cost system be adapted to the requirements of the needle industry, generally speaking? If so, why? State your reasons fully.
+3. How is the estimate of cost made?
+4. What relation do the opening and closing inventories bear to an estimating cost system?
+5. Set up pro forma ledger accounts for an estimating cost system.
+
+<img>A page from a book or report.</img>
+
+CHAPTER XXVII
+
+TEXTILE COSTS—MANUFACTURE OF YARN
+
+1. Nature of Problem
+
+While the general principles which underlie the determination of costs in the textile industry are the same as in other industries, such costs merit separate discussion because of their seemingly complex character. On analysis this complexity will be found to be more apparent than real. In some departments costs are found by the process method, and in others by the job order method because of the diversity of the productive operations. Certain processes or groups of processes are carried on at distinct industries, the product of one department becoming the raw material of another. Finally, the general operating conditions are fairly similar in all plants and the manufacturing processes are quite uniform throughout the different textile trades notwithstanding the different kinds of raw material used and many varieties of fabrics woven. All this makes for simplicity and thus the study of a representative system of textile accounts is all that is required to explain the cost problem. Such a system of textile accounts is presented in this and the two following chapters.
+
+2. Manufacture of Yarn
+
+The numerous processes involved in textile manufacture may be divided generally into:
+
+<page_number>363</page_number>
+
+364 REPRESENTATIVE SYSTEMS
+
+1. The making of yarn
+2. The weaving of cloth
+3. Knitting
+
+Cloth fabrics and knit goods of all kinds are made out of yarn, the raw material of which, for purposes of classification, may be divided into: (1) short fibres, (2) long vegetable fibres, and (3) silk. Cotton and wool are included in the first class; linen, hemp, and sisal under the second class; and silk is in a class by itself. In all except silk mills, raw fibres are first twisted together to form yarn “in singles,” i.e., single-ply yarn. From these singles two- or three-ply yarns are made. Three-ply yarns when twisted together form cabled yarns such as sewing thread and rope. Ply yarns only are used in the processes of weaving and knitting.
+
+Raw silk consists of the filaments of silk wound from the cocoon of the silk-worm in continuous strands. These strands are twisted together to make “thrown,” i.e., spun silk which is used in subsequent manufacturing processes. As the making of yarn is in all cases a series of continuous processes, the cost of the different processes is computed by means of the process method.
+
+3. The Weaving and Knitting of Fabrics
+
+In order to follow clearly the nature of the operations for which costs are computed, the following brief technical description is necessary.
+
+Weaving. Fabrics are woven by interlacing filling yarn, i.e., yarn which runs across the fabric, with warp yarn, i.e., yarn which runs the length of the fabric. The loom weaving entails three operations known as: (1)
+
+<img>A diagram showing the process of weaving.</img>
+
+TEXTILE COSTS—MANUFACTURE OF YARN 365
+
+shedding, (2) picking, and (3) beating up. Some of the warp yarns are raised and others depressed (depending upon the pattern of the fabric) by the harness of the loom across which they are stretched so as to make a “shed” through which the shuttle containing the filling-yarn passes. The second operation—picking—consists in driving the shuttle through the shed, each passage of the shuttle adding one pick to the fabric. The third operation consists of “beating up” the pick into its place so as to make a compact fabric. After the above cycle of operations is completed, the front beam of the loom holding the woven portion of the fabric winds up and the back beam holding the warp unwinds. The cycle is repeated until the loom run is completed.
+
+The number of picks per inch in the filling and number of ends per inch in the warp measure the fineness of the fabric. Each piece of fabric is woven in a special design and may be as long as required. Ordinarily the weaving of one warp constitutes a job for which a production order is issued and therefore costs in the weaving department of a textile mill are found by the job order method.
+
+Knitting. The process of knitting fabrics consists in looping a continuous strand of yarn together by means of either spring or latch needle machines and the operation is almost automatic. In computing the cost of knit goods such as hosiery or underwear, the unit cost per garment or per yard is found by dividing the cost of operating the machine or battery of knitting machines by the number of garments or yards produced. This method of cost-finding thus combines the features of both machine-hour and process costs.
+
+<page_number>366</page_number>
+REPRESENTATIVE SYSTEMS
+
+**4. Dyeing and Finishing Processes**
+
+Woven fabrics are finished in various ways by being dyed, bleached, mercerized, printed, and so on. The cost of each of these processes is departmentalized and distributed over the production to give the unit cost.
+
+The process of dyeing may be carried out in the raw, i.e., before the wool or cotton is made into yarn; or the yarn or cloth may be dyed. Many textile mills are equipped only to manufacture and dye yarns and others only to throw silk. Dyeing, whether of yarn or fabrics, may also be carried on as a separate industry. But a large-sized modern textile mill usually includes all processes within its walls.
+
+**5. Departmental Divisions**
+
+The accounts to be presented are those of a woolen mill, the productive departments of which are divided into:
+
+1. Dyeing
+2. Picking
+3. Carding
+4. Spinning
+5. Weaving
+6. Knitting
+
+Operations 2, 3, and 4 consist of the yarn manufacturing processes.
+
+The non-productive departments of the mill for which accounts are opened on the books consist of:
+
+1. Light, heat, and power
+2. Building maintenance
+3. General expense
+
+TEXTILE COSTS—MANUFACTURE OF YARN <page_number>367</page_number>
+
+4. Office expense
+5. Boarding house expense
+
+The cost of operating the stores-room is a comparatively small item of expense, and so is included among the general expense items. The expense of running a boarding house is part of the general operating expense.
+
+6. Material and Supplies Account
+
+In the system under consideration the raw material purchases are few in number and consist of different grades of wool, shoddy and waste, and dyestuffs and chemicals. These materials are kept in a stores-room, controlled by a stock record kept on the principle of the stores ledger. The raw materials are drawn upon as required by the picking and carding departments, the foremen of the departments making out the requisitions by which the issues are controlled. At the end of the cost period the requisitions are classified under the heads of: (1) raw materials, (2) supplies, and (3) dye-stuffs and chemicals, and the total in each case is posted to the controlling ledger account bearing the same name. The pro forma account which follows illustrates the operation of the Raw Material account.
+
+7. Waste Account
+
+In every textile mill an appreciable portion of the raw material charged to departments is returned to stores in the form of waste of some kind. Most of the waste, technically known as “card strippings” and “grey headings,” occurs in the making of yarn. Some of this waste is sold but a large part of it can be reworked. The
+
+<table>
+ <tr>
+ <td colspan="3">RAW MATERIAL (WOOL, SHODDY, AND WASTE)</td>
+ </tr>
+ <tr>
+ <td>Inventory:</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Wash<br/>Anthony, " 8000</td>
+ <td>Lot 8212<br/>10,000 lbs.<br/>10,000 lbs.</td>
+ <td>$ 7,500.00<br/>$ 7,500.00</td>
+ </tr>
+ <tr>
+ <td>33 Purchases:</td>
+ <td>20,000 lbs.</td>
+ <td>$145,600.00</td>
+ </tr>
+ <tr>
+ <td>Anthony, Lot 8211<br/>10,000 lbs.<br/>10,000 lbs.</td>
+ <td></td>
+ <td>$145,600.00</td>
+ </tr>
+ <tr>
+ <td>Freight on Purchases</td>
+ <td>1929</td>
+ <td>$2,920.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>30,000 lbs. at a cent.</td>
+ <td>60.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>50,000 lbs.</td>
+ <td>$89,898.99</td>
+ </tr>
+</table>
+
+<table>
+ <tr>
+ <td colspan="3">WASTE (TO BE SOLD OR REWORKED)</td>
+ </tr>
+ <tr>
+ <td>Inventory:</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Grey woolskins<br/>Grey headings</td>
+ <td>5,000 lbs.<br/>5,000 lbs.</td>
+ <td>$ 75.28<br/>$ 75.28</td>
+ </tr>
+ <tr>
+ <td>31 Manufactured<br/>Grey woolskins<br/>Grey headings</td>
+ <td>15,000 lbs.<br/>15,000 lbs.</td>
+ <td>$12,893.99</td>
+ </tr>
+</table>
+
+<table>
+ <tr>
+ <th>Inventory:</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</th><th>Total Quantity</th><th>Total Value</than></table>
+
+<table border="1">
+<tr style="background-color: #e6e6e6;">
+<td style="text-align: center;"><page_number>968</page_number></td>
+<td style="text-align: center;">REPRESENTATIVE SYSTEMS</td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></td>
+<td style="text-align: right;"></ td
+<tr style="background-color: #e6e6e6;">
+<td></table
+
+TEXTILE COSTS—MANUFACTURE OF YARN 369
+
+simplest method of accounting for it is to credit the departments with the approximate value of the waste returned to stock and debit them with issues as made. The sum of the returns and issues is controlled as shown on the pro forma account on page 368.
+
+**8. Stock in Process in Dye House Account**
+
+This account collects the cost of operating the dye house and is charged with the various items which make up the debit side of the account given below. At the end of each accounting period, the inventory of work in process is credited to this account. The difference between the total charges to the account and the closing inventory is the cost of the product of the dye house for the period, which is also credited to the account.
+
+If but a single product is made during the period, such as, for example, khaki, it is obvious that the cost of production is equal to the total cost of the output, as shown by the account divided by the number of pounds produced. Thus, if the production were 30,000 lbs. of khaki, the cost would be 98 cents per lb. as shown in the illustrative figures.
+
+**9. Mixes in Process (Picker Room) Account**
+
+In the manufacture of yarn certain quantities of different grades of wool, waste, or shoddy are mixed together in the picker room for the purpose of producing yarn of a definite weight and grade. Whenever a mix is to be made, an order is issued to the mixing department. This order gives the mix number and the pounds required, together with the ingredients. Generally, mixes are made in 2,000, 5,000, or 10,000 lb. lots.
+
+<table>
+ <tr>
+ <td>1 Inventory:</td>
+ <td>$0.00</td>
+ <td>$5,000.00</td>
+ <td>$8,000.00</td>
+ </tr>
+ <tr>
+ <td>Work, Lot A-300</td>
+ <td>10,000 lbs.</td>
+ <td>$5,000.00</td>
+ <td>$8,000.00</td>
+ </tr>
+ <tr>
+ <td>Anthony, Lot A-560</td>
+ <td>1,500 lbs.</td>
+ <td>$5,000.00</td>
+ <td>$8,000.00</td>
+ </tr>
+ <tr>
+ <td>2 Input (Per tonnage of daily report):</td>
+ <td>2,500 lbs.</td>
+ <td>$5,000.00</td>
+ <td>$8,000.00</td>
+ </tr>
+ <tr>
+ <td>Water</td>
+ <td>1,500 lbs.</td>
+ <td>$5,000.00</td>
+ <td>$8,000.00</td>
+ </tr>
+ <tr>
+ <td>Skipper from Stock</td>
+ <td>1,500 lbs.</td>
+ <td>$5,000.00</td>
+ <td>$8,000.00</td>
+ </tr>
+ <tr>
+ <td>Dryer,</td>
+ <td>1,500 lbs.</td>
+ <td>$5,000.00</td>
+ <td>$8,000.00</td>
+ </tr>
+ <tr>
+ <td>Chemicals</td>
+ <td>1,500 lbs.</td>
+ <td>$5,576.92</td>
+ <td>$8,999.92</td>
+ </tr>
+ <tr>
+ <td>Sprays</td>
+ <td>1,576 lbs.</td>
+ <td>$4,999.92</td>
+ <td>$8,999.92</td>
+ </tr>
+ <tr>
+ <td>Repairs</td>
+ <td>1,576 lbs.</td>
+ <td>$4,999.92</td>
+ <td>$8,999.92</td>
+ </tr>
+ <tr>
+ <td>Pye-Red</td>
+ <td>1,576 lbs.</td>
+ <td>$4,999.92</td>
+ <td>$8,999.92</td>
+ </tr>
+ <tr>
+ <td>Depreciation</td>
+ <td>1,576 lbs.</td>
+ <td>$4,999.92</td>
+ <td>$8,999.92</td>
+ </tr>
+ <tr>
+ <td>Insurance</td>
+ <td>1,576 lbs.</td>
+ <table border="1">
+ <tbody><tr><th>Taxes:</th><th></th><th></th><th></th></tr><tr><th>Lights,</th><th>Heat,</th><th>and Power (part)</th><th>283.33</th></tr><tr><th>Maintenance and Up-keep of Building (part)</th><th></th><th></th><th>283.33</th></tr><tr><th>Ground Expense (part)</th><th></th><th></th><th>283.33</th></tr><tr><th>Bosnian House (part)</th><th></th><th></th><th>283.33</th></tr><tr><th>Office Expense (part)</th><th></th><th></th><table border="1">
+ </tbody></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table>
+
+<table border="1">
+ <thead>
+ <tr style="background-color: #f2f2f2;">
+ <th colspan="4">STOCK IN PROCESS IN DYE HOUSE</th>
+ <!-- Output: $5,244.67 per tonne -->
+ <!-- Input: $4,766.33 per tonne -->
+ <!-- Anthony: $4,766.33 per tonne -->
+ <!-- Water: $4,766.33 per tonne -->
+ <!-- Skipper from Stock: $4,766.33 per tonne -->
+ <!-- Dryer: $4,766.33 per tonne -->
+ <!-- Chemicals: $4,766.33 per tonne -->
+ <!-- Sprays: $4,766.33 per tonne -->
+ <!-- Repairs: $4,766.33 per tonne -->
+ <!-- Pye-Red: $4,766.33 per tonne -->
+ <!-- Depreciation: $4,766.33 per tonne -->
+ <!-- Insurance: $4,766.33 per tonne -->
+ <!-- Taxes: $4,766.33 per tonne -->
+ <!-- Lights, Heat and Power (part): $4,766.33 per tonne -->
+ <!-- Maintenance and Up-keep of Building (part): $4,766.33 per tonne -->
+ <!-- Ground Expense (part): $4,766.33 per tonne -->
+ <!-- Bosnian House (part): $4,766.33 per tonne -->
+ <!-- Office Expense (part): $4,766.33 per tonne -->
+ <!-- Total: $48,252.58 -->
+ <!-- Anthony: $48,252.58 -->
+ <!-- Water: $48,252.58 -->
+ <!-- Skipper from Stock: $48,252.58 -->
+ <!-- Dryer: $48,252.58 -->
+ <!-- Chemicals: $48,252.58 -->
+ <!-- Sprays: $48,252.58 -->
+ <!-- Repairs: $48,252.58 -->
+ <!-- Pye-Red: $48,252.58 -->
+ <!-- Depreciation: $48,252.58 -->
+ <!-- Insurance: $48,252.58 -->
+ <!-- Taxes: $48,252.58 -->
+ <!-- Lights, Heat and Power (part): $48,252.58 -->
+ <!-- Maintenance and Up-keep of Building (part): $48,252.58 -->
+ <!-- Ground Expense (part): $48,252.58 -->
+ <!-- Bosnian House (part): $48,252.58 -->
+ <!-- Office Expense (part): $48,252.58 -->
+ <!-- Total: $48,252.58 -->
+ <!-- Anthony: $48,252.58 -->
+ <!-- Water: $48,252.58 -->
+ <!-- Skipper from Stock: $48,252.58 -->
+ <!-- Dryer: $48,252.58 -->
+ <!-- Chemicals: $48,252.58 -->
+ <!-- Sprays: $48,252.58 -->
+ <!-- Repairs: $48,252.58 -->
+ <!-- Pye-Red: $48,252.58 -->
+ <!-- Depreciation: $48,252.58 -->
+ <!-- Insurance: $48,252.58 -->
+ <!-- Taxes: $48,252.58 -->
+ <!-- Lights, Heat and Power (part): $48,252.58 -->
+ <!-- Maintenance and Up-keep of Building (part): $48,252.58 -->
+ <!-- Ground Expense (part): $48,252.58 -->
+ <!-- Bosnian House (part): $48,252.58 -->
+ <!-- Office Expense (part): $48,252.58 -->
+ <!-- Total: $48,252.58 -->
+ <!-- Anthony: $48,252.58 -->
+ <!-- Water: $48,252.58 -->
+ <!-- Skipper from Stock: $48,252.58 -->
+ <!-- Dryer: $48,252.58 -->
+ <!-- Chemicals: $48,252.58 -->
+ <!-- Sprays: $48,252.58 -->
+ <!-- Repairs: $4
+
+TEXTILE COSTS—MANUFACTURE OF YARN 371
+
+<table>
+ <tr>
+ <td colspan="5">MIXES IN PROCESS (JICKER ROOM)</td>
+ </tr>
+ <tr>
+ <td>Inventory:</td>
+ <td>30</td>
+ <td>30</td>
+ <td>30</td>
+ <td>30</td>
+ </tr>
+ <tr>
+ <td>Weeks let up</td>
+ <td>10,000 lbs.</td>
+ <td>8,000 lbs.</td>
+ <td>8,000 lbs.</td>
+ <td>8,000 lbs.</td>
+ </tr>
+ <tr>
+ <td>Rush from Up House</td>
+ <td>10,000 lbs.</td>
+ <td>10,000 lbs.</td>
+ <td>10,000 lbs.</td>
+ <td>10,000 lbs.</td>
+ </tr>
+ <tr>
+ <td>31 Input:</td>
+ <td>20,000 lbs.</td>
+ <td>87,500 lbs.</td>
+ <td>87,500 lbs.</td>
+ <td>87,500 lbs.</td>
+ </tr>
+ <tr>
+ <td>(Per daily report)</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Kilns (Per day's report)</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Purchase from Other Mills</td>
+ <td>16,500 lbs.</td>
+ <td>8,250 lbs.</td>
+ <td>8,250 lbs.</td>
+ <td>8,250 lbs.</td>
+ </tr>
+ <tr>
+ <td>Stock from Other Mills</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Regulars</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Pay Roll</table><table><tbody><tr><th>Paid Out</th><th>Cash</th><th>Cash from Prev</th><th>Cash from Prev</th></tr><tr><th colspan='4'>Insurance</th></tr><tr><th>Taxes</th><th>$25.00</th><th>$25.00</th><th>$25.00</th></tr><tr><th>Lights Heat and Power (part)</th><th>$25.00</th><th>$25.00</th><th>$25.00</th></tr><tr><th>Maintenance and Upkeep of Building</th><th>$25.00</th><th>$25.00</th><th>$25.00</th></tr><tr><th>General Expenses (part)</th><th>$25.00</th><th>$25.00</th><th>$25.00</th></tr><tr><th>Billing House (part)</th><th>$25.00</th><th>$25.00</th><th>$25.00</th></tr><tr><th>Clerk Expense (part)</th><th>$25.00</th><th>$25.00</th><th>$25.00</th></tr></tbody></table>
+
+<table border="1">
+ <thead>
+ <tr style="background-color: #f2f2f2;">
+ <th>Description</th>
+ <th>Amount (Part)</th>
+ <th>Total Amount (Part)</th>
+ <th>Total Amount (Whole)</th>
+ <br/>
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+
+372 REPRESENTATIVE SYSTEMS
+
+In calculating the cost of mixes produced during any period, it is necessary to distribute over the different mixes the total cost of production as shown by the debit to the ledger account given on page 371.
+
+This Mixes in Process (Picker Room) account is charged with the opening inventory of work in process, with all raw material issued to the picker room and all stock received from the dye house. In case mixed stock is delivered direct to the picker room from another mill, it is charged directly to this account through the purchase journal. Supplies and repair parts, the pay-roll, and lastly, a pro rata part of the fixed charges, maintenance, and up-keep of building, and general expense, are included in the Mixes in Process (Picker Room) account. At the end of each accounting period, the inventory of work in process in the picker room is credited to this account. The difference between the total debits to this account and the closing inventory gives the cost of the various mixes produced during the period which is credited to the account.
+
+10. Cost of Mixes Made
+
+In determining the cost of the different mixes produced during the period, the procedure is to figure the cost of material in each mix number by referring to the mixing department orders, which show the ingredients in each case. The labor and expense for the period can be apportioned over the different mixes on a pound basis. A columnar sheet should be used for making the calculation, arranged as shown below. As many columns will be needed as there are mixes produced during the period. It will be noticed that the column headings
+
+TEXTILE COSTS—MANUFACTURE OF YARN 373
+
+<table>
+ <tr>
+ <td colspan="5">COST OF MIXELS MADE IN PICKER ROOM</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Lot No.</td>
+ <td>Rfs. No.</td>
+ <td>Fundal.</td>
+ <td>281</td>
+ <td>91</td>
+ <td>284</td>
+ <td>1013</td>
+ <td>285</td>
+ <td>Etc.</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td>10,000</td>
+ <td>5,000</td>
+ <td>5,000</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Total:</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td colspan="5">Raw Materials:</td>
+ <td colspan="4">Assayt. Pkg.Ln. Assayt. Pkg.Ln. Assayt. Pkg.Ln. Assayt. Pkg.Ln.</td>
+ </tr>
+ <tr>
+ <td colspan="5">Supplies:</td>
+ <td colspan="4"></td>
+ </tr>
+ <tr>
+ <td colspan="5">Payroll:</td>
+ <td colspan="4"></td>
+ </tr>
+ <tr>
+ <td colspan="5">Depreciation:</td>
+ <td colspan="4"></td>
+ </tr>
+ <tr>
+ <td colspan="5">Insurance:</td>
+ <td colspan="4"></td>
+ </tr>
+ <tr>
+ <td colspan="5">Tax:</td>
+ <td colspan="4"></td>
+ </tr>
+ <tr>
+ <td colspan="5">Light, Heat, and Power:</td>
+ <td colspan="4"></td>
+ </tr>
+ <tr>
+ <td colspan="5">Maintenance and Up-keep:</td>
+ <td colspan="4"></td>
+ </tr>
+ <tr>
+ <td colspan="5">General Expense:</td>
+ <td colspan="4"></td>
+ </tr>
+ <tr>
+ <td colspan="5">Boarding House:</td>
+ <td colspan="4"></td>
+ </tr>
+ <tr>
+ <td colspan="5">Office Expense:</td>
+ <td colspan="4"></td>
+ </tr>
+ <tr style="border-top: solid black;">
+ <th>Total</th><th></th><th></th><th>$26,780.00</th><th>$8,000.00</th><th>$0.00</th><th>$4,200.00</th><th>$0.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,200.00</th><th>$8,2
+
+<page_number>874</page_number>
+
+**REPRESENTATIVE SYSTEMS**
+
+<table>
+ <tr>
+ <td colspan="3">YARN IN PROCESS (CARDING AND SPINNING)</td>
+ </tr>
+ <tr>
+ <td>Inventory:</td>
+ <td>Room report(1)</td>
+ <td>31 Original summary of daily Spinning</td>
+ </tr>
+ <tr>
+ <td>Lot 281, Mix 91, Run 200 $000 Ru. - $000.00</td>
+ <td>$6,250.00</td>
+ <td>$6,250.00</td>
+ </tr>
+ <tr>
+ <td>Lot 282, Mix 91, Run 200 $000 Ru. - $000.00</td>
+ <td>$6,250.00</td>
+ <td>$6,250.00</td>
+ </tr>
+ <tr>
+ <td>Bill Laptot (Over quantity)1</td>
+ <td>$6,250.00</td>
+ <td>$6,250.00</td>
+ </tr>
+ <tr>
+ <td>Lot 283, Mix 91</td>
+ <td>$6,250.00</td>
+ <td>$6,250.00</td>
+ </tr>
+ <tr>
+ <td>Lot 284, Mix 91</td>
+ <td>$6,250.00</td>
+ <td>$6,250.00</td>
+ </tr>
+ <tr>
+ <td>Lot 285, Mix 91</td>
+ <td>$6,250.00</td>
+ <td>$6,250.00</td>
+ </tr>
+ <tr>
+ <td>Lot 286, Mix 91</td>
+ <td>$6,250.00</td>
+ <td>$6,250.00</td>
+ </tr>
+ <tr>
+ <td>Lot 287, Mix 91</td>
+ <td>$6,250.00</td>
+ <td>$6,250.00</td>
+ </tr>
+ <tr>
+ <td>Lot 288, Mix 91</td>
+ <td>$6,250.00</td>
+ <td>$6,250.00</td>
+ </tr>
+ <tr>
+ <td>Lot 289, Mix 91</td>
+ <td>$6,250.00</td>
+ <td>$6,250.00</td>
+ </tr>
+ <tr>
+ <td>Card Cleaning:</td>
+ <td>$6,250.00</td>
+ <td>$6,250.00</td>
+ </tr>
+ <tr>
+ <td>Supplies:</td>
+ <td></td>
+ <td></table><br/>
+ Repairs:
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,533.83<br/>
+ $46,53
+<img>A table showing inventory details for Yarn in Process (Carding and Spinning).</img>
+
+TEXTILE COSTS-MANUFACTURE OF YARN 375
+
+<table>
+ <tr>
+ <td>Product</td>
+ <td>Cost</td>
+ <td>Total Cost</td>
+ </tr>
+ <tr>
+ <td>Spinning</td>
+ <td>6,000.00</td>
+ <td>6,000.00</td>
+ </tr>
+ <tr>
+ <td>Fleet Charge (per ton)</td>
+ <td>800.00</td>
+ <td>800.00</td>
+ </tr>
+ <tr>
+ <td>Preparation (per ton)</td>
+ <td>800.00</td>
+ <td>800.00</td>
+ </tr>
+ <tr>
+ <td>Daylighting (per ton)</td>
+ <td>800.00</td>
+ <td>800.00</td>
+ </tr>
+ <tr>
+ <td>Invoice</td>
+ <td>1,000.00</td>
+ <td>1,000.00</td>
+ </tr>
+ <tr>
+ <td>Transfer</td>
+ <td>5,000.09</td>
+ <td>5,000.09</td>
+ </tr>
+ <tr>
+ <td>Lights, Heat and Power (part)</td>
+ <td>1,166.67</td>
+ <td>1,166.67</td>
+ </tr>
+ <tr>
+ <td>Lights, Heat and Power (part)</td>
+ <td>1,166.67</td>
+ <td>1,166.67</td>
+ </tr>
+ <tr>
+ <td>Lights, Heat and Power (part)</td>
+ <td>1,166.67</td>
+ <td>1,166.67</td>
+ </tr>
+ <tr>
+ <td>Lights, Heat and Power (part)</td>
+ <td>1,166.67</td>
+ <td>1,166.67</td>
+ </tr>
+ <tr>
+ <td>Lights, Heat and Power (part)</td>
+ <td>1,166.67</td>
+ <td>1,166.67</td>
+ </tr>
+ <tr>
+ <td>Lights, Heat and Power (part)</td>
+ <td>1,166.67</td>
+ <td>1,166.67</td>
+ </tr>
+ <tr>
+ <td>Lights, Heat and Power (part)</td>
+ <td>1,166.67</td>
+ <td>1,166.67</td>
+ </tr>
+ <tr>
+ <td>Lights, Heat and Power (part)</td>
+ <td>1,166.67</td>
+ <td>1,166.67</td>
+ </tr>
+ <tr>
+ <td>Lights, Heat and Power (part)</td>
+ <td>1,166.67</td>
+ <td>1,166.67</td>
+ </tr>
+ <tr>
+ <td>Lights, Heat and Power (part)</td>
+ <td>1,166.67</td>
+ <td>1,166.67</td>
+ </tr>
+ <tr style="border-top: solid black;">
+ <!-- Table header -->
+
+
+
+ Total Cost: $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $893,783.49
+ = $
+
+376 REPRESENTATIVE SYSTEMS
+
+provide for showing the amount chargeable to each mix and also the cost per pound. Thus in the illustrative case presented, the cost of making 10,000 lbs. of mix No. 91 is $9,000, or 90 cents per lb.
+
+11. Yarn in Process (Carding and Spinning) Account
+
+After the raw wool has been mixed it is carded, or if a fine textile is to be made it is also combed preparatory to spinning into yarn. To obtain the cost of these two processes an account termed Yarn in Process (Carding and Spinning) is opened. The charges to this account are much the same as to the other process accounts. The method of determining the credits, i.e., the cost of the different lots of yarn spun, involves a technical explanation to be taken up in the following section. An example of a Yarn in Process account is given on page 374.
+
+12. Calculating the Cost of Yarn
+
+Yarn is made from different mixes in different sizes, and what is technically known as the "run" system of numbering woollen yarns is used for the purpose of estimating the carding and spinning cost. If one pound of one-run yarn contains 1,600 yards, and one pound avoirdupois contains 7,000 grains, it follows that:
+
+<table>
+ <tr>
+ <td>1 lb. of 1 run=1,600 yards; 50 yds.=218 gr.</td>
+ </tr>
+ <tr>
+ <td>1 " " 2 " " =3,200 " " 50 " " =100 "</td>
+ </tr>
+ <tr>
+ <td>1 " " 3 " " =4,800 " " 50 " " =72 "</td>
+ </tr>
+ <tr>
+ <td>1 " " 3/4 " " =1,200 " " 50 " " =291 "</td>
+ </tr>
+ <tr>
+ <td>1 " " 1/2 " " =800 " " 50 " " =437"</td>
+ </tr>
+ <tr>
+ <td>1 " " 1/4 " " =400 " " 50 " " =875 "</td>
+ </tr>
+</table>
+
+In the mill under consideration the grains per 50
+
+TEXTILE COSTS--MANUFACTURE OF YARN 97
+
+yds. of yarn designate the run. Thus, the yarn pro-
+duced is known as a 200-run, a 160-run yarn, and so on.
+This is equivalent to saying that the mill is making 1.1
+run (218÷200=1.1), 1.38 run, and so on. From the
+ foregoing table it is seen that the length of one pound
+of yarn varies directly with the run number. For cost
+purposes it is assumed that the cost of conversion (labor
+and expense) in the carding and spinning rooms is also
+proportional to the run number and on this basis labor
+and expense are apportioned to the various sizes of yarn.
+
+Suppose, for example, that the labor and expense
+for a certain period are $12,000, and that five runs of
+yarn have been produced as shown in columns 1 and 2
+of the table given below. The method of apportioning
+the $12,000 over the different runs is then to multiply
+the pounds by the run number and prorate the amount
+over the product as shown.
+
+<table>
+<thead>
+<tr>
+<td colspan="5">TABLE SHOWING THE METHOD OF CALCULATING THE CONVERSION COST (LABOR AND EXPENSE) FOR EACH RUN OF YARN</td>
+</tr>
+<tr>
+<td>Run</td>
+<td>Pounds</td>
+<td>Product</td>
+<td>Product</td>
+<td>Labor and Expense Per Lb.</td>
+</tr>
+</thead>
+<tbody>
+<tr>
+<td>(1)</td>
+<td>Yield</td>
+<td>(1) and (2)</td>
+<td>Multiplier</td>
+<td>(3) and (4)</td>
+<td>(5) - (7)</td>
+</tr>
+<tr>
+<td>(2)</td>
+<td></td>
+<td>(3)</td>
+<td>(4)</td>
+<td>(5)</td>
+<td>(6)</td>
+</tr>
+<tr>
+<td>1.1</td>
+<td>5,300</td>
+<td>6,350</td>
+<td>1,0684</td>
+<td>$ 1,068.48</td>
+<td>$ 1,383</td>
+</tr>
+<tr>
+<td>1.25</td>
+<td>5,300</td>
+<td>6,350</td>
+<td>1,0684</td>
+<td>$ 1,068.48</td>
+<td>$ 1,383</td>
+</tr>
+<tr>
+<td>1.4</td>
+<td>6,400</td>
+<td>8,400</td>
+<td>1,6684</td>
+<td>$ 1,461.46</td>
+<td>$ 2,356</td>
+</tr>
+<tr>
+<td>1.3</td>
+<td>9,000</td>
+<td>13,500</td>
+<td>1,6684</td>
+<td>$ 2,922.34</td>
+<td>$ 3,922</td>
+</tr>
+<tr>
+<td>1.8</td>
+<td>22,000</td>
+<td>36,000</td>
+<td>1,6684</td>
+<td>$ 3,636.89</td>
+<td>$ 5,300</td>
+</tr>
+<tr>
+<td></td><td></td><td></td><td></td><td></td><td></td>
+</tr>
+<tr>
+<td></td><td>46,000</td><td>71,205</td><td></td><td>$12,000.00</td><td></td>
+</tr>
+<tr>
+<td></td><td></td><td></td><td></td><td></td><td></td>
+</tr>
+<tr>
+<td></td><td>$12,000.÷ 71,205 = 1.6844 </td><td></td><td></td><td></td><td></td>
+</tr>
+<tr>
+<td></td><td>71,925 ÷ 46,000 = 1.565 run average </td><td></td><td></td><td></td><td></td>
+</tr>
+<tr>
+<td></td><td>$12,000 ÷ 46,000 = 2.69 per lb. of run 1.565 </table>
+
+$2.29 ÷ 1.565 = $1.46 per lb. of run 1
+
+378
+
+<table>
+ <tr>
+ <td colspan="5">COST OF YARN CARDED AND SPUN</td>
+ <td colspan="5">REPRESENTATIVE SYSTEMS</td>
+ </tr>
+ <tr>
+ <td>Lot No.</td>
+ <td>Rhs No.</td>
+ <td>Pounds Used</td>
+ <td>Yield</td>
+ <td>981</td>
+ <td>91</td>
+ <td>96</td>
+ <td>96</td>
+ <td>5,000</td>
+ <td>5,000</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td>53,000</td>
+ <td>46,000</td>
+ <td>4,200</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td>Gross Total</td>
+ <td>Total Pcs Lb.</td>
+ <td>Pcs La.</td>
+ <td>Total</td>
+ <td>Pcs La.</td>
+ <td>Pcs La.</td>
+ </tr>
+ <tr>
+ <td>Cost of Raw Material</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td>$84,000.00</td>
+ <td>$8,857.1</td>
+ <td>$8,857.1</td>
+ <td>$8,857.1</td>
+ <td>$8,857.1</td>
+ </tr>
+ <tr>
+ <td>Card Cleaning</table><table><tbody><tr><th>Cost of Raw Material</th><th>$84,000.00</th><th>$8,857.1</th><th>$8,857.1</th><th>$8,857.1</th></tr><tr><th>Spare Parts</th><th>10,000.00</th><th>10,000.00</th><th>10,000.00</th><th>10,000.00</th></tr><tr><th>Pulp-Hull-Corning</th><th>1,926.33</th><th>1,926.33</th><th>1,926.33</th><th>1,926.33</th></tr><tr><th>Pulp-Hull-Spining-Broom</th><th>4,926.33</th><th>4,926.33</th><th>4,926.33</th><th>4,926.33</th></tr><tr><th>Drapery-Striping-Room</th><th>5,926.33</th><th>5,926.33</th><th>5,926.33</th><th>5,926.33</th></tr><tr><th>Tumble Dryer and Power,</th><th>196.67</th><th>196.67</th><th>196.67</th><th>196.67</th></tr><tr><th>Light, Heat and Power,</th><th>836.67</th><thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.67<thalink style="background-color: #cccccc;">836.
+
+TEXTILE COSTS—MANUFACTURE OF YARN 379
+
+From the table on page 377 it is seen that 1.1-run yarn costs $8.1835 per lb., for labor and expense. As each run is made from a certain mix number, the cost of material is obtained from a sheet showing the cost per pound of each mix number. Reference to the sheet on page 378 shows that the cost of run 1.1 is made up of raw material, labor, and expense. As many columns are employed for the purpose of ascertaining the cost of each run as may be required.
+
+Yarn making is often carried on as an isolated industry in mills specially equipped for the purpose; and even in textile mills which do their own spinning the cost of yarn is segregated from other costs. Yarn then becomes the raw material to be used in the weaving of cloth and the knitting of fabrics. The methods of determining the cost of these processes are described in the following chapter.
+
+REVIEW QUESTIONS
+
+1. What is the necessity for departmentalizing labor and expense in a textile mill?
+2. What are the typical cost accounts required in a woolen mill?
+3. How should the labor and expense in the picking department be distributed?
+4. How should the cost of yarn be calculated?
+5. What is meant by the "run" system for numbering woolen yarn and how are the run numbers used in cost calculations?
+
+<img>A page from a book with text discussing textile costs and manufacturing of yarn.</img>
+
+CHAPTER XXVIII
+
+TEXTILE COSTS—WEAVING AND KNITTING
+
+1. Cloth in Process (Weaving) Account
+
+To ascertain the cost of woven cloth produced, a manufacturing or work in process account called Cloth in Process (Weaving) account is opened and is charged with the inventory at the beginning, with the yarn used —whether received from the spinning room or purchased from outside mills—and the pay-roll of the weaving department, which department includes the operations of spooling, dressing, drawing-in, weaving, and burling. Finally the Cloth in Process (Weaving) account is charged with a pro rata part of the fixed charges, maintenance and up-keep of the building, and general expense.
+
+At the end of each month this account is closed with an inventory of the cloth in process. The difference between the total debits and the closing inventory gives the cost of the woven fabrics produced during the period.
+
+The usual plan, as already stated, is to treat the weaving end of the mill as an entirely separate enterprise. If the yarn mill sells to the weaving mill, it should be credited for its product at cost, and the yarn should also be charged to the weaving mill at cost.
+
+The general form and the usual entries in the Cloth in Process (Weaving) account are shown on pages 382 and 383.
+
+<page_number>380</page_number>
+
+TEXTILE COSTS—WEAVING AND KNITTING 381
+
+To calculate the cost of each woven fabric produced during the period and thus determine the credits to Cloth in Process account, it is necessary to apportion the total cost of production, as shown by the debit side of Cloth in Process (Weaving) account, among the different styles woven. To this end a record is kept of the output of the weaving department during each period.
+
+Thus, assume the production during the month to be as follows:
+
+<table>
+ <thead>
+ <tr>
+ <th>Style</th>
+ <th>Looms</th>
+ <th>Finished Yds.</th>
+ <th>Looms</th>
+ <th>Yds.</th>
+ <th>Finished Yds.</th>
+ <th>Pieces</th>
+ </tr>
+ </thead>
+ <tbody>
+ <tr>
+ <td>115</td>
+ <td>125,485</td>
+ <td>96,461</td>
+ <td>80,749</td>
+ <td></td>
+ <td>48,119</td>
+ <td>1096</td>
+ </tr>
+ <tr>
+ <td>132</td>
+ <td>4276</td>
+ <td>2,501</td>
+ <td>1,246</td>
+ <td></td>
+ <td>1,764</td>
+ <td>40</td>
+ </tr>
+ <tr>
+ <td>129-1</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td>37</td>
+ <td>1</td>
+ </tr>
+ <tr>
+ <td>i24-1</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td>37</td>
+ <td>1</td>
+ </tr>
+ </tbody>
+ <tfoot>
+ <tr>
+ <th colspan="7">Samples</th>
+ </tr>
+ </tfoot>
+</table>
+
+The problem now is to make an apportionment of the cost of weaving during the period among the different styles. The construction of a fabric determines what warp and filling is used. Thus, style 115 cloth is made up of 60% warp yarn (mix 91, run 160) and 40% filling yarn (mix 91, run 160). The cost of the yarn is obtained from the yarn cost sheets.
+
+Spooling labor is paid for at the rate of 16.07 cents per 1,000 yds. for a 7%—run yarn, on which basis a charge for spooling can be made to each fabric for spooling warp yarn. Dressing labor is paid for by the day and can be distributed on the basis of the number of warps dressed. Drawing-in is paid for at the rate of 48.4 cents per 1,000 ends in the warp, on which basis the individual styles can be charged. Weavers on fabrics
+
+382
+
+CLOTH IN PROCESS (WEAVING)
+
+<table>
+ <tr>
+ <td>1 Inventory (Per unit of Weaving Department re-)</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Lot 250, M/s. (Total 200)</td>
+ <td>30</td>
+ </tr>
+ <tr>
+ <td>* 275 = 95, Run 136</td>
+ <td>8 3,000.00</td>
+ </tr>
+ <tr>
+ <td>* 280 = 103, Run 129</td>
+ <td>4,000.00</td>
+ </tr>
+ <tr>
+ <td>Lot 475, M/s. (Gyodak) (Total 200)</td>
+ <td>3,000.00</td>
+ </tr>
+ <tr>
+ <td>Lot 475, M/s. (Run 29)</td>
+ <td>4,000.00</td>
+ </tr>
+ <tr>
+ <td>Water Damson on Foca</td>
+ <td>2,000.00</td>
+ </tr>
+ <tr>
+ <td>Style 115</td>
+ <td>1,000.00</td>
+ </tr>
+ <tr>
+ <td>Style 115</td>
+ <td>1,000.00</td>
+ </tr>
+ <tr>
+ <td>Coron on Foca</td>
+ <td>2,000.00</td>
+ </tr>
+ <tr>
+ <td>Style 115</td>
+ <td>3,000.00</td>
+ </tr>
+</table>
+
+31 Input (Per unit of daily Spinning)
+<table>
+ <tr>
+ <td>Lot 251, M/s.</td>
+ <td>818,300.00</td>
+ </tr>
+ <tr>
+ <td>* Lot 251, M/s.</td>
+ <td>4,691.82</td>
+ </tr>
+ <tr>
+ <td>* Lot 251, M/s.</td>
+ <td>4,691.82</td>
+ </tr>
+</table>
+
+31 Output (Per unit of daily Spinning)
+<table>
+ <tr>
+ <td>Lot 251, M/s.</td>
+ <td>889,639.97</td>
+ </tr>
+ <tr>
+ <td>* Lot 251, M/s.</td>
+ <td>4,691.82</td>
+ </tr>
+</table>
+
+REPRESENTATIVE SYSTEMS
+
+TEXTILE COSTS—WEAVING AND KNITTING 883
+
+<table>
+ <tr>
+ <td>Lot 267 Mt. 105, Rum 125</td>
+ <td>1,600 lbs.</td>
+ <td>5,652.00</td>
+ <td>Waters Damson cv. Fronie</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>at 28% Mt. 91, at 36%</td>
+ <td>160</td>
+ <td>4,000.00</td>
+ <td>Syste 115, extra Pn. non</td>
+ <td>13,900.00</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Purchase Price</td>
+ <td>91, at 36%</td>
+ <td>360.00</td>
+ <td>Water Damson cv. Fronie</td>
+ <td>5,224.83</td>
+ <td>Extra Pn. non</td>
+ <td>10,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Supplies</td>
+ <td></td>
+ <td>5,000.00</td>
+ <td>Syste 115, extra Pn. non</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Repairs</td>
+ <td></td>
+ <td>10,000</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Special Outside Laborer,</table>
+
+<table>
+ <tr><th>Dry Goods</th><th>Purchase Price (net)</th><th>Total Cost (net)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</th><th>Taxable Value (tax)</th><th>Taxable Value (net)</than<td colspan="2">Total Tax</table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<tr style="background-color: #f2f2f2;">
+<td style="text-align: center;">Lettuce<br>(Net Weight)<br>(Pkt.)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax)<br>(Tax.<table style="border-collapse: collapse; border: none; margin: auto; width: 100%; height: auto;">
+<tr style="background-color: #f2f2f2;">
+<td style="text-align: center;">Lettuce<br style="font-size: smaller;">(Net Weight)...</table style="border-collapse: collapse; border: none; margin: auto; width: 100%; height: auto;">
+<tr style="background-color: #f2f2f2;">
+<td style="text-align: center;">(Pkt.)...</table style="border-collapse: collapse; border: none; margin: auto; width: 100%; height: auto;">
+<tr style="background-color: #f2f2f2;">
+<td style="text-align: center;">(Pkt.)...</table style="border-collapse: collapse; border: none; margin: auto; width: 100%; height: auto;">
+<tr style="background-color: #f2f2f2;">
+<td style="text-align: center;">(Pkt.)...</table style="border-collapse: collapse; border: none; margin: auto; width: 100%; height: auto;">
+<tr style="background-color: #f2f2f2;">
+<td style="text-align: center;">(Pkt.)...</table style="border-collapse: collapse; border: none; margin: auto; width: 100%; height: auto;">
+<tr style="background-color: #f2f2f2;">
+<td style="text-align: center;">(Pkt.)...</table style="border-collapse: collapse; border: none; margin: auto; width: 100%; height: auto;">
+<tr style="background-color: #f2f2f2;">
+<td style="text-align: center;">(Pkt.)...</table style="border-collapse: collapse; border: none; margin: auto; width: 100%; height: auto;">
+<tr style="background-color: #f2f2f2;">
+<td style="text-align: center;">(Pkt.)...</table style="border-collapse: collapse; border: none; margin: auto; width: 100%; height: auto;">
+<tr style="background-color: #f2f2f2;">
+<td style="text-align: center;">(Pkt.)...</table style="border-collapse: collapse; border: none; margin: auto; width: 100%; height: auto;">
+<tr style="background-color: #f2f2f2;">
+<td style="text-align: center;">(Pkt.)...</table style="border-collapse: collapse; border: none; margin: auto; width: 100%; height: auto;">
+<tr style="background-color: #f2f2f2;">
+<td style="text-align: center;">(Pkt.)...</table style="border-collapse: collapse; border: none; margin: auto; width: 100%; height: auto;">
+<tr style="background-color: #f2f2f2;">
+<td style="text-align: center;">(Pkt.)...</table style="border-collapse: collapse; border: none; margin: auto; width: 100%; height: auto;">
+<tr style="background-color: #f2f2f2;">
+<td style="text-align:center;">(Pkt.)...</table style="border-collapse:none;border:none;margin:auto;width:auto;height:auto;"></tr></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table></tbody></table/></thead><tbody><tr class='header_bottom_margin'><td colspan='3'></tr><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'><thead class='header_bottom_margin'><tr class='header_bottom_margin'>
+
+<table>
+ <tr>
+ <td><strong>384</strong></td>
+ <td colspan="2"><strong>REPRESENTATIVE SYSTEMS</strong></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td><strong>STP No.</strong></td>
+ <td><strong>Date</strong></td>
+ <td><strong>COST OF CLOTH WOVEN</strong></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>No. of Pieces (70d per warp)</td>
+ <td></td>
+ <td>115</td>
+ </tr>
+ <tr>
+ <td>No. of Pieces (70d per warp)</td>
+ <td></td>
+ <td>2,294</td>
+ </tr>
+ <tr>
+ <td>No. of Pieces (70d per warp)</td>
+ <td></td>
+ <td>26</td>
+ </tr>
+ <tr>
+ <td>No. of Pieces (70d per warp)</td>
+ <td></td>
+ <td>244</td>
+ </tr>
+ <tr>
+ <td>No. of Pieces (70d per warp)</td>
+ <td></td>
+ <td>909</td>
+ </tr>
+ <tr>
+ <td>Filling No. - 91, Run 169, % - 40%</td>
+ <td></td>
+ <td>275 Bns.</td>
+ </tr>
+ <tr>
+ <td colspan="2">Corr. Max.-Min. Tens.</td>
+ <td>Ancorcr Pkg.La.</td>
+ <td>Ancorcr Pkg.La.</td>
+ <td>Ancorcr Pkg.La.</td>
+ </tr>
+ <tr>
+ <td>Tens-Warp at Bl(18) at Bl(18)</td>
+ <td></td>
+ <td>$862.59</td>
+ <td>$862.59</td>
+ <td>$862.59</td>
+ </tr>
+ <tr>
+ <td>Total Cost of Yarns</td>
+ <td></td>
+ <td>8805.08</td>
+ <td>8805.08</td>
+ <td>8805.08</td>
+ </tr>
+ <tr>
+ <td>Direc Labor:</th><th>Sergeant, Yarn, P. W. at Bl(18)</th><th>$3.64</th><th>$3.64</th><th>$3.64</th></tr><tr><th>Direc Labor:</th><th>Dressing Yarn, D. W. at Bl(18)</th><th>3.12</th><th>3.12</th><th>3.12</th></tr><tr><th>Direc Labor:</th><th>Dressing Yarn, D. W. at Bl(18)</th><th>29.36</th><th>29.36</th><th>29.36</th></tr><tr><th>Direc Labor:</th><th>Weaving Yarn, F.W. at Bl(18) per yd.</th><th>876.15</th><th>876.15</th><th>876.15</th></tr><tr><th>Direc Labor:</th><th>Total Direc Labor.</th><th>876.15</th><th>876.15</th><th>876.15</th></tr><tr><th>Direc Labor:</th><th>Begins Weaving Day Laborer</th><th>-</th><th>-</th><th>-</th></tr><tr><th>Direc Labor:</th><th>Weaving Day Laborer</th><th>-</th><th>-</th><th>-</th></tr><tr><th>Direc Labor:</th><th>Weaving Day Laborer</th><th>-</th><th>-</th><th>-</th></tr><tr><th>Direc Labor:</th><th>Lifting Yarn and Power of Yarn General Exercise Place Overhead Lopes of Direc Laborer</th><table cellspacing="0" cellpadding="0" border="0">
+ </table></table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="0" border="0">
+ </table>
+
+<table cellspacing="0" cellpadding="
+
+TEXTILE COSTS—WEAVING AND KNITTING <page_number>385</page_number>
+
+with 24 picks per inch receive 8.8 cents per yard, on which basis weaving labor can be charged to the differ-
+ent styles. Burlers are paid by the day and so their time can be apportioned on a yardage basis.
+
+In addition to the direct labor above mentioned, other items to be charged to each style are the general weaving room labor, the fixed charges, a pro rata share of the maintenance and up-keep of the building, and general expenses. The basis to use in making the appor-
+tionment is the direct labor charge. The total cost of the yarn, direct labor, and overhead in the weaving de-
+partment gives the cost of the woven fabric.
+
+The tabulation on page 384 illustrates the method of calculation. In case the weaving department of a mill only works on one style during a period, the cost calculation is a very simple matter.
+
+2. Cloth in Process (Knitting) Account
+
+This account, as presented on the following page, is operated in the same way as the Cloth in Process (Weaving) account. The stock produced as shown on the credit side is of two kinds—spring needle and latch needle—and the cost problem is to ascertain the unit cost of each style of fabric produced. To this end a record is kept of the yards and pieces knit of each style.
+
+The manufacture of a knit fabric usually requires but one size of yarn, as the process consists in continually looping together the yarn until a sufficient quantity of goods has been produced. This is, of course, very differ-
+ent from the condition in a weaving mill where many kinds of yarn may be interlaced in order to make the fabric.
+
+<table>
+ <tr>
+ <td>1 Inventory on the Noma floor</td>
+ <td>31 Output (for summary of Knitting Depart.</td>
+ <td>31 Output (for summary of Knitting Depart.</td>
+ </tr>
+ <tr>
+ <td>Lot 274, Mts. 8, Rm. 100</td>
+ <td>1,000 lbs.</td>
+ <td>1,000 lbs.</td>
+ <td>1,000 lbs.</td>
+ </tr>
+ <tr>
+ <td>Cash: $575</td>
+ <td>$575</td>
+ <td>$575</td>
+ <td>$575</td>
+ </tr>
+ <tr>
+ <td>Lot 677, Mts. 8, Rm. 100</td>
+ <td>1,000 lbs.</td>
+ <td>1,000 lbs.</td>
+ <td>1,000 lbs.</td>
+ </tr>
+ <tr>
+ <td>Cash: $245</td>
+ <td>$245</td>
+ <td>$245</td>
+ <td>$245</td>
+ </tr>
+ <tr>
+ <td>81 Input (for summary of daily output)</td>
+ <td>31 Inventory (for summary of daily output)</td>
+ <td>31 Inventory (for summary of daily output)</td>
+ </tr>
+ <tr>
+ <td>Bread (per unit): $2.98</td>
+ <td>2.98</td>
+ <td>2.98</td>
+ <td>2.98</td>
+ </tr>
+ <tr>
+ <td>Lc. 286,</td>
+ <td>2.98</td>
+ <td>2.98</td>
+ <td>2.98</td>
+ </tr>
+ <tr>
+ <td>Potatoes:</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Potatoes: Washing at 4.5 cents per pound</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Knitting Lathery:</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Lathery: Newspaper, Hardware...</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Mending:</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Sewing:</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th><br><th colspan="3">Fresh Green Vegetables:</th></tr>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing='0' cellpadding='0'>
+<tr style='text-align:center;'>
+<td style='width:1%;'></table>
+
+<table cellspacing 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cellpadding= 'cell;padding=""></thead>
+
+<tbody>
+
+<tr class = "header_row">
+<th align = "left" >CLOTH IN PROCESS (KNITTING)</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Knitting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.</thead>
+
+<th align = "left" >Output (for summary of Kniting Depart.)
+
+**FEXTILE COSTS—WEAVING AND KNITTING** 387
+
+**3. Cost of Cloth Knit**
+
+The method of calculating the cost of cloth knit is shown in the table on page 388. The cost of yarn can be ascertained from the yarn cost sheets and a proper charge made accordingly. Labor in the winding department is paid for at the rate of 5 cents per spool, and mending is paid for at the rate of 3 cents per yard, on which basis a charge can be made to each style. It is assumed that the pay-roll of the spring needle section is chargeable to style 1010 and that of the latch needle section to style 1055. The indirect expense of the knitting department is divided between styles in proportion to the direct labor charge.
+
+**4. Cloth in Process (Wet and Dry Finishing) Account**
+
+The fabrics which have been either woven or knit are charged to the Cloth in Process (Wet and Dry Finishing) account. This account is also charged with all labor and expenses incurred in connection with the finishing operation. At the end of each accounting period the cost of the finished fabrics is calculated and credited to this account, leaving a balance equal to the inventory value of unfinished fabrics, as shown on page 389.
+
+**5. Calculating the Cost of Finished Cloth**
+
+The next step is to apportion the cost of the production of the wet and dry finishing departments over the different styles. This can be done on a columnar sheet as illustrated in the example given on page 390. The cost of the material is obtained from the weaving and knitting department cost sheets. Labor and expense are apportioned on a yardage basis, as shown.
+
+<table>
+ <tr>
+ <td colspan="3">REPRESENTATIVE SYSTEMS</td>
+ </tr>
+ <tr>
+ <td rowspan="2">Cost of Cloth Knit</td>
+ <td rowspan="2"></td>
+ <td rowspan="2"></td>
+ </tr>
+ <tr>
+ <td>100%</td>
+ <td>100%</td>
+ <td>100%</td>
+ <td>100%</td>
+ <td>100%</td>
+ </tr>
+ <tr>
+ <td>Material</td>
+ <td>Total:</td>
+ <td>Amount</td>
+ <td>Yrs Yc.</td>
+ <td>Amount</td>
+ <td>Yrs Yc.</td>
+ <td>Amount</td>
+ <td>Yrs Yc.</td>
+ </tr>
+ <tr>
+ <td>Pay-Off</td>
+ <td>$ 50,000.00</td>
+ <td>$ 7,000.00</td>
+ <td></td>
+ <td>$ 6,850.00</td>
+ <td></td>
+ <td>$ 6,850.00</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Cutting and Sizing Fabric</td>
+ <td>$ 5,000.00</td>
+ <td>$ 1,000.00</td>
+ <td></td>
+ <td>$ 1,155.00</td>
+ <td></td>
+ <td>$ 1,155.00</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Cutting and Sizing Needles</td>
+ <td>$ 5,000.00</td>
+ <td>$ 1,155.00</td>
+ <td></td>
+ <td>$ 282.50</td>
+ <td></td>
+ <td>$ 282.50</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Total Pay-Off</td>
+ <td>$ 15,000.00</td>
+ <td>$ 14,145.00</td>
+ <td></td>
+ <td>$ 1,467.50</td>
+ <td></td>
+ <td>$ 1,467.50</td>
+ <table><tbody><tr><th style="text-align: left;">Overhead Expense:</th><th style="text-align: right;">$ 2,500.00</th><th style="text-align: right;">$ 2,500.00</th><th style="text-align: right;">$ 2,500.00</th><th style="text-align: right;">$ 2,500.00</th><th style="text-align: right;">$ 2,500.00</th><th style="text-align: right;">$ 2,500.00</th><th style="text-align: right;">$ 2,500.00</th></tr><tr><th style="text-align: left;">Fibers and Spools:</th><th style="text-align: right;">$ 2,500.00</th><th style="text-align: right;">$ 2,500.00</th><th style="text-align: right;">$ 2,500.00</th><th style="text-align: right;">$ 2,500.00</th><th style="text-align: right;">$ 2,500.00</th><th style="text-align: right;">$ 2,500.00</th><th style="text-align: right;">$ 2,500.00</th></tr><tr><th style="text-align: left;">Needles-Lace:</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th></tr><tr><th style="text-align: left;">Labor and Power:</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th></tr><tr><th style="text-align: left;">Materials and Up-Crop of Building:</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><th style="text-align: right;">$ 1,253.33</th><table>
+
+<tr class='header_bottom_margin'>
+<td colspan='7'></table>
+
+<tr class='annotation_item'>
+<td>Building Frame:</table>
+
+<tr class='annotation_item'>
+<td>Overhead Expense:</table>
+
+<tr class='annotation_item'>
+<td>Total Cost:</table>
+
+<tr class='annotation_item'>
+<td>$82,899.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.66 $819,869.6
+
+TEXTILE COSTS—WEAVING AND KNITTING 389
+
+<table>
+ <tr>
+ <td>Inventory</td>
+ <td>Cloth in Process (Wet and Dry Finishing)</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>1 Inventory</td>
+ <td>Cloth in Process (Wet and Dry Finishing)</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Stock</td>
+ <td>Yds., -- lbs.</td>
+ <td>$ 2,000.00</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Stock</td>
+ <td>Yds., -- lbs.</td>
+ <td>$ 2,000.00</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Stock</td>
+ <td>Yds., -- lbs.</td>
+ <td>$ 4,000.00</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Stock</td>
+ <td>Yds., -- lbs.</td>
+ <td>$ 6,000.00</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Purchases</td>
+ <td>Yds., -- lbs.</td>
+ <td>$ 15,079.90</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Purchases</td>
+ <td>Yds., -- lbs.</td>
+ <td>$ 15,079.90</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Payroll</td>
+ <td>Yds., -- lbs.</td>
+ <td>$ 1,500.00</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Repairs</td>
+ <td>Yds., -- lbs.</td>
+ <td>$ 500.00</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Payroll</td>
+ <td>Yrs., -- lbs.</td>
+ <td>$ 500.00</td>
+ <table><tbody><tr><th style="text-align: right;">31 January:</th><th style="text-align: left;">$872,456.99</th></tr><tr><th style="text-align: right;">31 January:</th><th style="text-align: left;">$10,678.28</th></tr><tr><th style="text-align: right;">31 January:</th><th style="text-align: left;">$13,223.28</th></tr><tr><th style="text-align: right;">31 January:</th><th style="text-align: left;">$866,132.59</th></tr></tbody></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table>
+
+<table border="1">
+<tr><th>Description</th><th>Amount (net)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</th><th>Description (per Finishing Department re- part.)</than td colspan="2" rowspan="2">Office Expense (net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)</span>(net)
+
+390
+REPRESENTATIVE SYSTEMS
+
+<table>
+ <tr>
+ <td colspan="5">COST OF CLOTH FINISHED</td>
+ </tr>
+ <tr>
+ <td>Yard Finished</td>
+ <td>115</td>
+ <td>36,000</td>
+ <td>100</td>
+ <td>6,500</td>
+ </tr>
+ <tr>
+ <td>Pound Finished</td>
+ <td>67,900</td>
+ <td>440</td>
+ <td>1,500</td>
+ <td>5,500</td>
+ </tr>
+ <tr>
+ <td>Total</td>
+ <td>892,890.30</td>
+ <td>806,200.00</td>
+ <td>1,615,820.00</td>
+ <td>826,612.20</td>
+ </tr>
+ <tr>
+ <td>Material:</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Labor:</td>
+ <td>$ 892.890.30</td>
+ <td>$ 892.890.30</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Wet Finishing</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Dry Finishing</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Spray</td>
+ <td>$ 294.890.30</td>
+ <td>$ 294.890.30</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <th>Total Labor:</th><th></th><th>$ 1,187,780.60</th><th>$ 901,780.60</th><th>$ 1,615,820.00</th><th>$ 826,612.20</th>
+ </tr>
+ <tr>
+ <th>Overhead Payments:</th><th></th><th></th><th></th><th></th><th></th>
+ </tr>
+ <tr>
+ <th>Repairs & Repaints:</th><th>$ 1,187,780.60</th><th>$ 901,780.60</th><th>$ 135.00</th><th>$ 135.00</th><th></th>
+ </tr>
+ <tr>
+ <th>Depreciation:</th><th>$ 255,334.45</th><th>$ 255,334.45</th><th>$ 325.45</th><th>$ 325.45</th><th></th>
+ </tr>
+ <tr>
+ <th>Labor Int & Power:</th><th>$ 197,946.45</th><th>$ 197,946.45</th><th>$ 247.45</th><th>$ 247.45</th><th></th>
+ </tr>
+ <tr>
+ <th>Management & Upkeep of General Office:</th><th>$ 49,977.33</th><th>$ 49,977.33</th><th>$ 623.33</th><th>$ 623.33</th><th></th>
+ </tr>
+ <tr>
+ <th>General Expense:</th><th>$ 29,287.33</th><th>$ 29,287.33</th><th>$ 361.33</th><th>$ 361.33</th><th></th>
+ </tr>
+ <tr style="border-top: double;">
+ <thead style="background-color: #e6e6e6;">
+ <tr style="text-align: center;">
+ <td>Total:</td><td>$ 892,890.30</td><td>$ 806,200.00</td><td>$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ $$ **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$** **$**
+ </tr>
+ <!-- Additional rows -->
+ <!-- ... -->
+ <!-- Last row -->
+ <!-- Total: -->
+ <!-- Cost: -->
+ <!-- Overhead: -->
+ <!-- Total Cost: -->
+ <!-- Total Overhead: -->
+ <!-- Total Cost + Overhead: -->
+ <!-- Total Cost - Overhead: -->
+ <!-- Total Cost + Overhead - Overhead: -->
+ <!-- Total Cost - Overhead + Overhead: -->
+ <!-- Total Cost - Overhead - Overhead: -->
+ <!-- Total Cost + Overhead - Overhead - Overhead: -->
+ <!-- Total Cost - Overhead + Overhead - Overhead: -->
+ <!-- Total Cost - Overhead - Overhead + Overhead: -->
+ <!-- Total Cost - Overhead - Overhead - Overhead: -->
+ <!-- Total Cost + Overhead - Overhead - Overhead - Overhead: -->
+ <!-- Total Cost - Overhead + Overhead - Overhead - Overhead - Overhead: -->
+ <!-- Total Cost - Overhead - Overhead + Overhead - Overhead - Overhead: -->
+ <!-- Total Cost - Overhead - Overhead - Overhead + Overhead: -->
+ <!-- Total Cost + Overhead - Overhead - Overhead - Overhead - Overhead: -->
+ <!-- Total Cost - Overhead + Overhead - Overhead - Overhead - Overhead - Overhead: -->
+ <!-- Total Cost - Overhead - Overhead + Overhead - Overhead - Overhead - Overhead: -->
+ <!-- Total Cost - Overhead - Overhead - Overhead + Overhead: -->
+ <!-- Total Cost + Overhead - Overhead - Overhead - Overhead - Overhead: -->
+ <!-- Total Cost - Overhead + Overhead - Overhead - Overhead - Overhead: -->
+ <!-- Total Cost - Overheading + Overall Cost: -->
+ <!-- Total Cost + Overall Cost: -->
+ <!-- Total Cost + Overall Cost (Including): -->
+ <!-- Total Cost + Overall Cost (Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+ <!-- Total Cost + Overall Cost (Including and Excluding): -->
+
+TEXTILE COSTS—WEAVING AND KNITTING 391
+
+<table>
+ <tr>
+ <td>1 Inventory</td>
+ <td>FINISHED CLOTH</td>
+ <td>31 Cost of Goods Sold</td>
+ </tr>
+ <tr>
+ <td>Style 113 on, Melton, --- pcs.</td>
+ <td>8 $200.00</td>
+ <td>Style 113, Melton --- pcs.</td>
+ <td>8 $724.150</td>
+ </tr>
+ <tr>
+ <td>Kvpr --- pcs.</td>
+ <td>--- lbs.</td>
+ <td>Style 100 --- pcs.</td>
+ <td>--- lbs.</td>
+ </tr>
+ <tr>
+ <td>Sale 1910 & 4, Bue, O. D. blankets,</td>
+ <td>$600.00</td>
+ <td>Style 100 --- pcs.</td>
+ <td>$192.00</td>
+ </tr>
+ <tr>
+ <td>og. $48</td>
+ <td>$600.00</td>
+ <td>Inventory:</td>
+ <td>$1800.000</td>
+ </tr>
+ <tr>
+ <td>Size 1055, 5% lbs., Grey blankets,</td>
+ <td>$600.00</td>
+ <td>Wares:</td>
+ <td>$600.00</td>
+ </tr>
+ <tr>
+ <td>og. $48</td>
+ <td>$600.00</td>
+ <td>Style 113, Melton --- pcs.</td>
+ <td>--- pcs.</td>
+ <td>--- lbs.</td>
+ <td>$500.00</td>
+ </tr>
+ <tr>
+ <td>31 Finished Production (Per Finding De- partment report):</td>
+ <td>$724.150</td>
+ <td>Style 113, Melton --- pcs.</td>
+ <td>--- pcs.</td>
+ <td>--- lbs.</td>
+ <td>O. D. blankets,</td>
+ <td>$300.00</td>
+ </tr>
+ <tr>
+ <td>Style 1975 --- lbs.</td>
+ <td>$724.150</td>
+ <td>Style 1975 --- pcs.</td>
+ <td>--- pcs.</td><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br></tr>
+ <tr>
+ <td>Kerr --- lbs.</td>
+ <table border="1">
+ <thead>
+ <tr>
+ <th></th>
+ <th></th>
+ <th></th>
+ <th></th>
+ </tr>
+ </thead>
+ <tbody>
+ <tr style="background-color: #f2f2f2;">
+ <th>Style 1975 --- pcs.</th>
+ <th>--- pcs.</th>
+ <th>--- lbs.</th>
+ <th>O. D., Grey blankets,</th>
+ <th>$378.50</th>
+ </tr>
+ <!-- Additional rows for other styles -->
+ </tbody>
+ </table></tr>
+
+<tr style="border-top: double;">
+ <td colspan="2">$811,739.50</td></tr>
+
+<tr style="border-top: double;">
+ <td colspan="2">$811,739.50</td></tr>
+
+<tr style="border-top: double;">
+ <td colspan="2">$811,739.50</td></tr>
+
+<tr style="border-top: double;">
+ <td colspan="2">$811,739.50</td></tr>
+
+<tr style="border-top: double;">
+ <td colspan="2">$811,739.50</td></tr>
+
+<tr style="border-top: double;">
+ <td colspan="2">$811,739.50</td></tr>
+
+<tr style="border-top: double;">
+ <td colspan="2">$811,739.50</td></tr>
+
+<tr style="border-top: double;">
+ <td colspan="2">$811,739.50</td></tr>
+
+<tr style="border-top: double;">
+ <td colspan="2">$811,739.50</td></tr>
+
+<tr style="border-top: double;">
+ <td colspan="2">$811,739.50</td></tr>
+
+<tr style="border-top: double;">
+ <td colspan="2">$811,739.50</td></tr>
+
+<tr style="border-top: double;">
+ <td colspan="2">$811,739.50</td></tr>
+
+<tr style="border-top: double;">
+ <table border="1">
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+ ...
+
+392
+REPRESENTATIVE SYSTEMS
+
+**6. Finished Cloth Account**
+
+This account is charged with the production shown in Cloth in Process (Wet and Dry Finishing) account. The closing balance in this account represents the cost of goods sold. The manner of operating the account is shown on page 391.
+
+---
+
+**REVIEW QUESTIONS**
+
+1. What is the general procedure followed in calculating the cost of a woven fabric?
+2. How are the labor and expense of the finishing department apportioned over the output?
+3. To what account is the finished fabric charged?
+
+CHAPTER XXIX
+
+TEXTILE COSTS—GENERAL EXPENSE
+
+1. Expense Accounts
+
+In addition to the operating department accounts referred to in the preceding chapter, various expense accounts are opened to distribute the charges for heat, light, power, depreciation, taxes, etc., to departments. The schedules of distribution are given when required, to show the basis on which the charges are computed. With the exception of Shipping Expense which is closed out to Cost of Sales account, all the other expense accounts are closed out to the various manufacturing departments and to Shipping Expense.
+
+<table>
+ <tr>
+ <td>Shipping Department Expense</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>31 Pay-Roll</td>
+ <td>$800.00</td>
+ <td>31 Cost of Goods Sold.</td>
+ <td>$805.00</td>
+ </tr>
+ <tr>
+ <td>Supplies</td>
+ <td>200.00</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Repairs</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Misc. Expense</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Fixed Charge</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Depreciation</td>
+ <td>80.00</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Insurance</td>
+ <td>20.00</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Taxes</td>
+ <td>10.00</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Transfers:</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Light, Heat, and Power</td>
+ <td>80.00</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Maintenance and Up-Keep of Building</td>
+ <td>25.00</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>General Expense</td>
+ <td>5.00</td>
+ <table><tbody><tr><th style="text-align: right;">$865.00</th><th style="text-align: right;">$865.00</th></tr><tr><th style="text-align: right;"></th><th style="text-align: right;"></th></tr><tr><th style="text-align: right;"><page_number>393</page_number></th><th style="text-align: right;"></th></tr></tbody></table></table>
+
+<page_number>394</page_number>
+
+**REPRESENTATIVE SYSTEMS**
+
+**LIGHT, HEAT, AND POWER**
+
+<table>
+ <tr>
+ <td>31 Purchases</td>
+ <td>$1,850.00</td>
+ <td>31 Stock in Process</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Depreciation</td>
+ <td>600.00</td>
+ <td>(Dye House)</td>
+ <td>$ 200.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Mill in Process</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>(Picker Room)</td>
+ <td>200.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Yarn in Process</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>(Carding and Spin- ning)</td>
+ <td>300.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process</td>
+ <td>(Wet and Dry Fin- ishing)</td>
+ <td>500.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process</td>
+ <td>(Knitting)</td>
+ <td>100.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process</td>
+ <td>(Wet and Dry Fin- ishing)</td>
+ <td>500.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Shipping Department Expense</td>
+ <td></td>
+ <td>50.00</td>
+ </tr>
+ <tr style="border-top: 1px solid black;">
+ <th colspan="2">$1,850.00</th>
+ <th colspan="2">$1,850.00</th>
+ </tr>
+</table>
+
+The distribution of horse-power in the mill is re-
+ported to be as follows:
+
+<table style="width:100%;">
+ <thead style="background-color:#f2f2f2;">
+ <tr style="text-align:center;">
+ <th>H.P.</th>
+ <!-- Total H.P. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in the mill runs the same number of hours. If otherwise, the distribution of power must be in proportion to the product of the horse- power and hours run. -->
+ <!-- This is the basis to use for apportioning all power purchased if each department in
+
+TEXTILE COSTS--GENERAL EXPENSE 395
+
+MAINTENANCE AND UP-KEEP OF BUILDINGS
+
+<table>
+ <tr>
+ <td>31 Purchases</td>
+ <td>$ 25.00</td>
+ <td>31 Stock in Process</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Pay-Hold</td>
+ <td>50.00</td>
+ <td>(Dye House)</td>
+ <td>$ 100.00</td>
+ </tr>
+ <tr>
+ <td>Depreciation</td>
+ <td>80.00</td>
+ <td>Misses in Process</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Insurance</td>
+ <td>50.00</td>
+ <td>(Picker Room)</td>
+ <td>100.00</td>
+ </tr>
+ <tr>
+ <td>Taxes</td>
+ <td>50.00</td>
+ <td>Yard Work</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>(Carding and Spin-</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>ning)</td>
+ <td>200.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>(Wearing)</td>
+ <td>500.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>(Knitting)</td>
+ <td>100.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>(Wet and Dry Fin-</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>ishing)</td>
+ <td>400.00</td>
+ </tr>
+ <tr>
+ <td></table><br/>
+The floor space used by productive departments is as follows:
+
+<table id="floor_space_table">
+ <!-- Floor Space Table -->
+</table>
+
+<table id="department_expense_table">
+ <!-- Department Expense Table -->
+</table>
+
+<table id="total_sq_ft_table">
+ <!-- Total Sq. Ft. Table -->
+</table>
+
+In the foregoing tabulation all non-productive area is omitted, such as space used for entrance halls, superintendent's office, elevator shafts, stairways, etc.
+
+<table>
+ <tr>
+ <td>31 Purchases</td>
+ <td>$250.00</td>
+ <td>31 Stock in Process (Dye House)</td>
+ <td>$100.00</td>
+ </tr>
+ <tr>
+ <td>Pay-Roll</td>
+ <td>400.00</td>
+ <td>Mixes in Process (Picker Room)</td>
+ <td>100.00</td>
+ </tr>
+ <tr>
+ <td>Depreciation</td>
+ <td>200.00</td>
+ <td>Yarn in Process (Carding and Spinning)</td>
+ <td>100.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process (Wetting)</td>
+ <td>300.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process (Knitting)</td>
+ <td>60.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process (Wet and Dry Finish-ing)</td>
+ <td>200.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Shipping Department Expense</td>
+ <td>20.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td><strong>$870.00</strong></td>
+ <td></td>
+ <td><strong>$870.00</strong></td>
+ </tr>
+</table>
+
+This account is closed out on the basis of the productive labor pay-roll.
+
+<table>
+ <tr>
+ <td>31 Purchases</td>
+ <td>$180.00</td>
+ <td>31 Stock in Process (Dye House)</td>
+ <td>$80.00</td>
+ </tr>
+ <tr>
+ <td>Depreciation</td>
+ <td>260.00</td>
+ <td>Mixes in Process (Picker Room)</td>
+ <td>50.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Yarn in Process (Carding and Spinning)</td>
+ <td>50.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process (Wetting)</td>
+ <td>150.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process (Knitting)</td>
+ <td>25.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process (Wet and Dry Finish-ing)</td>
+ <td>15.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Shipping Department Expense</td>
+ <td>15.00</td>
+ </tr>
+ <tr style="border-top: double black;">
+ <th colspan="2"></th><th colspan="2"><strong>$385.00</strong></th><th><strong>$385.00</strong></th><th style="text-align: right;">$385.00</th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></th><th style="text-align: right;"></thal<th style="text-align: center;">BOARDING HOUSE ACCOUNT</thal<th style="font-size:x-large;">$385.00</thal<th style="font-size:x-large;">$385.00<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></thal<th/></tal
+<img>A table showing General Expense Account and Boarding House Account.</img>
+
+TEXTILE COSTS—GENERAL EXPENSE 397
+
+Office Expense Account
+
+<table>
+ <tr>
+ <td>31 Purchases</td>
+ <td>$ 40.00</td>
+ <td>31 Stock in Process</td>
+ <td>(Dye House)</td>
+ <td>$ 60.00</td>
+ </tr>
+ <tr>
+ <td>Pay-Roll</td>
+ <td>100.00</td>
+ <td>Mixes in Process</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Depreciation</td>
+ <td>100.00</td>
+ <td>Yarn in Process (Carding and Spinning)</td>
+ <td></td>
+ <td>50.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process</td>
+ <td></td>
+ <td>50.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>(Weaving)</td>
+ <td></td>
+ <td>50.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process</td>
+ <td></td>
+ <td>10.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>(Knitting)</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Cloth in Process</td>
+ <td></td>
+ <td>20.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>(Wet and Dry Finish ing)</td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Shipping Department Expense</td>
+ <td></td>
+ <td>10.00</td>
+ </tr>
+ <tr><th colspan="2">F940.00</th><th colspan="2"></th><th>F940.00</th></tr>
+</table>
+
+This account is closed out on the basis of the productive labor pay-roll.
+
+TABLE SHOWING APPORTIONMENT OF DEPRECIATION BY PERIODS
+
+<table border="1">
+ <thead>
+ <tr><th rowspan="2">Annual Depreciation</th><th colspan="2">4 Weeks</th><th colspan="2">5 Weeks</th><th colspan="2">13 Weeks</th></tr>
+ <tr><th>Dye House</th><th>Picker Room.</th><th>Carding</th><th>Spinning</th><th>Weaving</th><th>Knitting</th><th>Firing</th><th>Shipping</th><th>General Building Per manent Fixtures.</th></tr>
+ </thead>
+ <tbody>
+
+ </tbody>
+</table>
+
+Notes: The five-week periods are December, March, June, and September. The other periods are four weeks each. Each quarter has thirteen weeks (one five-week and two four-week periods).
+
+398
+REPRESENTATIVE SYSTEMS
+
+<table>
+ <tr>
+ <td colspan="5">ESTIMATE OF DEPRECIATION ON PLANT</td>
+ </tr>
+ <tr>
+ <td>Carr.</td>
+ <td>% of Cost</td>
+ <td>Scrap Value</td>
+ <td>Amount</td>
+ <td>Life In Years</td>
+ <td>Annual Depreciation</td>
+ </tr>
+ <tr>
+ <td>Dry House</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Poker Room</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Celling</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Sparking</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Washing</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Kneading</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Slicing</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>General Purpose Fixtures</td>
+ <td></td>
+ <td></td>
+ <td></td>
+ <table border="1">
+ <tbody><tr><th>Total</th><th>$\$$</th><th>$\$$</th><th>$\$$</th><th>$\$$</th><th>$\$$</th></tr><tr><th>Dry House</th><th>$\$$</th><th>$\$$</th><th>$\$$</th><th>$\$$</th><th>$\$$</th></tr><tr><th>Poker Room</th><th>$\$$</th><th>$\$$</th><th>$\$$</th><th>$\$$</th><th>$\$$</th></tr><tr><th>Celling</th><th>$\$$</th><th>$\$$</th><th>$\$$</th><th>$\$$</th><th>$\$$</th></tr><tr><th>Sparking</th><th>$\$$</th><th>$\$$</th><th>$\$$</th><th>$\$$</th><th>$\$$</th></tr><tr><th>Washing</th><th>$\$$</th><th>$\$$</th><th>$\$$</th><th>$\$$</th><th>$\$$</th></tr><tr><th>Kneading</th><table border="1"><tbody><tr><thead><tr><th>Description of Fixtures (in $)</thead></tr></tbody></table> $<table border="1"><tbody><tr><thead><tr><th>Description of Fixtures (in $)</thead></tr></tbody></table> $<table border="1"><tbody><tr><thead><tr><th>Description of Fixtures (in $)</thead></tr></tbody></table> $<table border="1"><tbody><tr><thead><tr><th>Description of Fixtures (in $)</thead></tr></tbody></table> $<table border="1"><tbody><tr><thead><tr><th>Description of Fixtures (in $)</thead></tr></tbody></table> $<table border="1"><tbody><tr><thead><tr><th>Description of Fixtures (in $)</thead></tr></tbody></table> $<table border="1"><tbody><tr><thead><tr><th>Description of Fixtures (in $)</thead></tr></tbody></table> $<table border="1"><tbody><tr><thead><tr><th>Description of Fixtures (in $)</thead></tr></tbody></table> $<table border="1"><tbody><tr><thead><tr><th>Description of Fixtures (in $)</thead></tr></tbody></table> $<table border="1"><tbody><tr><thead><tr><th>Description of Fixtures (in $)</thead></tr></tbody></table> $<table border="1"><tbody><tr><thead><tr><th>Description of Fixtures (in $)</thead></tr></tbody></table> $<table border="1"><tbody><tr><thead rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan="2"><tr colspan="6">Total$<table border="1"><tbody rowspan"
+
+TEXTILE COSTS--GENERAL EXPENSE 399
+
+<table>
+ <tr>
+ <td colspan="2">INSURANCE PREPAID ACCOUNT</td>
+ </tr>
+ <tr>
+ <td>31 Purchases</td>
+ <td>$2,470.00</td>
+ <td>31 Stock in Process (Dye House) $100.00<br>Mixes in Process (Picker Room) 100.00<br>Yarn in Process (Carding and Spinning) 500.00<br>Yarn in Process (Weaving) 500.00<br>Cloth in Process (Knitting) 100.00<br>Cloth in Process (Wet and Dry Finishing) 100.00<br>Shipping Department Expense 20.00<br>Maintenance and Up-keep of Buildings Balance 50.00<br>Balance $1,068.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>$2,470.00</td>
+ <td>$2,470.00</td>
+ </tr>
+</table>
+
+<table>
+ <tr>
+ <td>TAXES ACCRUED ACCOUNT</td>
+ </tr>
+ <tr>
+ <td>31 Purchases Balance $8,600.00</td>
+ <td>31 Stock in Process (Dye House) $50.00<br>Mixes in Process (Picker Room) 50.00<br>Yarn in Process (Carding and Spinning) 100.00<br>Yarn in Process (Weaving) 100.00<br>Cloth in Process (Knitting) 50.00<br>Cloth in Process (Wet and Dry Finishing) 50.00<br>Shipping Department Expense 10.00<br>Maintenance and Up-keep of Buildings Balance 50.00</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>$846.00</td>
+ <td>$846.00</td>
+ </tr>
+</table>
+
+<table>
+ <tr>
+ <td>400</td>
+ <td>REPRESENTATIVE SYSTEMS</td>
+ </tr>
+ <tr>
+ <td colspan="2">Pay-Roll Account</td>
+ </tr>
+ <tr>
+ <td>T Cash</td>
+ <td>$ 7,000.00</td>
+ </tr>
+ <tr>
+ <td>14 Cash</td>
+ <td>7,000.00</td>
+ </tr>
+ <tr>
+ <td>21 Cash</td>
+ <td>7,000.00</td>
+ </tr>
+ <tr>
+ <td>38 Cash</td>
+ <td>7,000.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">Yarn in Process:</td>
+ </tr>
+ <tr>
+ <td colspan="2">1. Carding ..... $450.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">2. Spinning ..... $5,000.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">Cloth in Process:</td>
+ </tr>
+ <tr>
+ <td colspan="2">1. Spinning ..... $1,000.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">2. Dressing ..... $1,000.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">3. Drawing-in ..... $1,000.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">4. Weaving-P. C ..... $3,500.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">5. Weaving-P. W ..... $6,500.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">6. Burling ..... $1,500.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">Cloth in Process (Knitting):</td>
+ </tr>
+ <tr>
+ <td colspan="2">1. Winding ..... $85.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">2. Knitting-Spring ..... $1,555.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">3. Knitting-Latch Needle ..... $1,555.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">4. Mending ..... $85.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">Cloth in Process (Wet and Dry Finishing):</td>
+ </tr>
+ <tr>
+ <td colspan="2">1. Wet Finishing ..... $85.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">2. Dry Finishing ..... $85.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">3. Sewing ..... $85.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">Maintainer's Up-Keep of Building ..... $85.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">General Expense ..... $85.00</td>
+ </tr>
+ <tr>
+ <td colspan="2">Office Expense ..... $85.00</td>
+ </tr>
+ <tr><td colspan="2" style="text-align:right;">$3,555.00</td></tr><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom: -1px;"><hr style="border-top: solid black; border-width: thin; margin-top: -1px; margin-bottom:-
+
+TEXTILE COSTS—GENERAL EXPENSE <page_number>401</page_number>
+
+REVIEW QUESTIONS
+
+1. What is the best basis for apportioning power to the various departments?
+2. How should the up-keep and maintenance of buildings be distributed to the factory departments?
+3. What items should be included under the head of General Expense, and how should the General Expense account be distributed to the various departments?
+4. What plan is best adapted to a textile mill for calculating the amount of depreciation applicable to each period?
+
+<img>A blank page with a faint vertical line on the right side.</img>
+
+Part VIII
+Graphic Presentation of Cost Data
+
+[API_EMPTY_RESPONSE]
+
+CHAPTER XXX
+USE OF GRAPHIC CHARTS
+
+1 Graphs vs. Statements
+
+The control of present, and the planning of future, business activities must to a great extent be based on the comparison of present with past performances. For this reason an important part of the work of the cost accountant should be the compiling of cumulative statistics covering the past operations of the business and the presentation of these statistics in such a way that the vital facts as to the activities of the business are brought forcefully into the remembrance of executives. The more detailed the records, and the more clearly the relation between costs, expenses, and output are shown, the more effectively can activities be guided and controlled.
+
+When statistics are presented in the form of statements and tabulated figures, close study and some calculation are usually required before their significance is grasped. The columns of figures of one statement must be carefully scrutinized and cross-reference made to the corresponding figures of other statements to trace the causes of increases and decreases. Some better, clearer method of presentation is needed. This is found in the graphic chart when it is required to show clearly the relation between two sets of figures derived from different sources; or when increases, decreases, and ratios are, as it were, to be thrown into relief, graphic charts possess
+
+<page_number>405</page_number>
+
+<page_number>406</page_number> GRAPHIC PRESENTATION OF COST DATA
+
+many material advantages over statements and tabu-
+lated figures.
+
+The great superiority of the chart form over the
+statement form for certain kinds of presentation lies
+in the ease, the vividness, and the completeness with which
+statistical information, comparisons, and results attained
+can be shown by the former. The value of the chart form
+for such purposes is well known to engineers, who
+make use of it, particularly for comparative purposes,
+whenever practicable. But the full value of the chart
+method of presentation for comparative purposes is not
+yet generally realized by accountants, as their experi-
+ence has usually been limited to graphs designed to show
+differences and not ratios.
+
+2. Difference and Ratio Charts
+
+The charts most commonly employed are termed
+“difference” charts and show arithmetical increases or
+decreases only. Their function, when used in cost work,
+is restricted to showing rises and falls in prices, unit
+costs, and so on. Ratio charts show the ratio of increase
+or decrease, i.e., the distance upward or downward rep-
+resents the percentage of increase or decrease, depend-
+ing upon the scale used.
+
+3. Difference Charts
+
+A difference chart is usually drawn on a sheet of
+cross-section paper, technically known as “co-ordinate”
+paper. When this paper is used, both vertical and hori-
+zontal lines mark off the units of measurement. Thus,
+for cost work, each division upward may represent one
+dollar, ten dollars, a pound, a ton, ten gallons, or any
+
+USE OF GRAPHIC CHARTS <page_number>407</page_number>
+
+other unit; while the divisions from left to right usually mark off the daily, monthly, or yearly periods depending upon the length of time which the chart is intended to cover. The units of measurement are usually indicated on the left-hand side of the chart, and, to make the calculation and reading of the figures easy, every tenth line—both vertical and horizontal—is frequently more heavily ruled than the others. The periods of time indicated by the vertical lines are also shown—usually at the bottom of the chart—in some distinctive way. When all this is done, the plotting of data on the charts is a simple matter. In difference charts, the zero line is always shown, and is made very heavy.
+
+**4. Illustrative Difference Charts**
+
+For the purpose of showing the construction and the field of utility of difference charts, two illustrations are given on page 408. It should be noted that the base line is zero and that the charts are read from left to right.
+
+Form 54 is a graph used in actual practice in a silk mill. The curves show the fluctuations in the labor and expense per yard of silk woven during the year. The distances between horizontal lines represent four cents a yard. The months are read from left to right as indicated. It will be seen that the total labor and expense per yard has fluctuated during the year between $8.22$ and $8.30$ per yard. The high peak culminating in March was caused by a partial strike which more than doubled the cost of production. The peak in September was caused by an increase in general expense due to extraordinary repairs. The chart as a whole shows a marked drop in the unit cost of labor and expense, especially
+
+408 GRAPHIC PRESENTATION OF COST DATA
+
+<img>Chart showing Cost per Unit of Product.</img>
+<page_number>Form 53. Chart showing Average Selling Price and Average Cost of Sales per Pound-SH-MIII</page_number>
+
+<img>Chart showing Labor and Expense per Yard-Silk Mill.</img>
+<page_number>Form 54. Chart showing Cost per Unit of Product.</page_number>
+
+USE OF GRAPHIC CHARTS <page_number>409</page_number>
+
+during the last half of the year, caused mainly by increased production.
+
+Form 55 shows how the average selling price per pound compares with the average cost of sales per pound in a sill-throwing mill. The trend of selling prices and costs is upward and on several occasions costs have actually exceeded selling prices. This increase was due to old contracts outstanding and a steadily rising price for raw silk. Manufacturers sometimes fail to realize that sales are being made below cost, when such is the case, until the matter is presented to them in graphic form.
+
+**5. Limitations of Difference Charts**
+
+Difference charts are best adapted to the comparison of unit costs, or for showing the trend in prices over a period of years. The scale used must, of course, be adapted to fit the data and the size of paper.
+
+When two or more sets of figures are to be compared, a single difference chart is limited to the presentation of figures which have the same unit as their common base; that is, comparisons must be made between different quantities of the same unit, dollars, or pounds, for example. If, for instance, the proportion of a silk mill in pounds is to be compared over a period of several years, the difference charts are suitable. When different units are to be compared, these charts do not give good results. Thus if it is desired to compare the pounds of silk sold with the amount (dollars) received for them for corresponding periods, the scale that fits the pounds does not fit the dollars. If two scales are provided, the presentation becomes complex.
+
+**410 GRAPHIC PRESENTATION OF COST DATA**
+
+Another limitation of the difference chart is that the rise and fall of the curves which represent two sets of figures may convey little meaning when fluctuations in a relatively small item of cost are compared with the fluctuations of a large item. The curve of the latter may show pronounced valleys and peaks, while the curve of the former, though the ratio of differences is quite as great, may show only slight undulations.
+
+**6. Ratio Charts**
+
+Ratio charts are constructed by marking off the field into main divisions, each line in a division representing a geometrical progression, that is, a multiple of the same line in the division below. The base number may be 1, 10, 100, and so on. Each main division is the same height, and the number of the divisions needed depends upon the lowest and the highest numbers to be compared. Thus, if the lowest number in the table of data to be plotted is 100, and the highest 1,000,000, the chart would be divided into four main divisions, as follows, reading from the bottom up:
+
+<table>
+<tr><td>1,000,000</td></tr>
+<tr><td>100,000</td></tr>
+<tr><td>10,000</td></tr>
+<tr><td>1,000</td></tr>
+<tr><td>100</td></tr>
+</table>
+
+In a ratio chart the base line is never zero. The distance between the main divisions may be any number of inches, the number depending upon the degree of accuracy required in measuring the scale.
+
+To illustrate the purpose of dividing the chart in this
+
+USE OF GRAPHIC CHARTS <page_number>411</page_number>
+
+way, assume that the spaces between the divisions representing the scales 10, 100, 1,000, 10,000, 100,000 are each one inch. It will be seen that a curve rising from 10 to 100 represents a tenfold increase and moves upward one inch. Or again, suppose the curve moves from 10,000 to 100,000. This also represents a tenfold increase and moves just one inch upward. In the first case the arithmetical difference is 90, while in the latter case it is 90,000. Nevertheless, the ratio of increase for the period is 90% in each case.
+
+7. Use of Ratio Charts
+
+Ratio charts have a wider field of utility than difference charts in that they make possible the comparison of large numbers with small numbers and vice versa, so that the relation between them and the percentage of increase or decrease can readily be seen. That is, magnitudes are usually shown instead of unit prices or costs.
+
+Suppose, for example, it is desired to compare the total pay-roll disbursements over a period of months with their hourly work output during the same period per hour. When comparisons such as this by means of ratios are desired, the scale of numbers does not mean dollars, or hours, or cents, but ratios or percentages, and so one scale answers for all. An increase in the pay-roll from $100,000 to $110,000 is a 10% increase and would be represented by the same increase in the vertical movement as an increase from 50 cents to 55 cents, or 10% in the wage rate. In order to tell whether the increase in pay-roll hours is inclined to be greater than that of wage rates, all that is necessary is to note the angle taken by the lines. The line which goes up at the sharpest angle
+
+**412 GRAPHIC PRESENTATION OF COST DATA**
+
+means that the item is increasing at the fastest rate. Thus an increase in the number of pay-roll hours may be accompanied by a decrease in wage rates or vice versa. Many useful comparisons can be made in this way.
+
+An interesting feature of the ratio charts is that compound interest curves when plotted or drawn on ratio paper result in straight lines. That is, if the amount of $1 at 10% compound interest be shown at the end of each year for, say, ten years, the line which connects the points would be absolutely straight. The explanation of this fact is that a straight line indicates a fixed rate per cent of increase or decrease. Assume, for example, that an operating expense curve rises throughout the year in an approximately straight line, and it is desired to ascertain the per cent of increase each month. Assume again that the curve starts on January 1 at $10,000 and on February 1 passes through the $10,100 line. $10,100—$10,000=$100. $100 is 1% of $10,000. Therefore, the operating expense increased during January at the rate of 1% and continued at that rate throughout the year because the line was straight. On January 1 of the ensuing year the expense would be $11,268.
+
+**8. Illustrative Ratio Charts**
+
+The accompanying charts and the statement figures from which the curves are plotted are taken from the actual practice of a textile mill. It is interesting to note and compare the clearness and simplicity of the information furnished by the charts with the seeming confusion and intricacy of the statement of figures.
+
+In studying the charts it should be borne in mind
+
+USE OF GRAPHIC CHARTS <page_number>413</page_number>
+
+<img>
+A line graph showing production, labor, and expenses over time.
+The y-axis ranges from 0 to 60,000 units.
+The x-axis shows months: January, February, March, April, May, June, July, August, September, October, November, December.
+Production (Y-axis): Starts at around 50,000 units in January, peaks around 60,000 units in February, then decreases slightly to around 55,000 units by March.
+Labor (Y-axis): Starts at around 25,000 hours in January, increases to around 35,000 hours in February, then decreases slightly to around 32,000 hours by March.
+Expenses (Y-axis): Starts at around $15,000 in January, peaks around $25,000 in February, then decreases slightly to around $23,000 by March.
+
+Legend:
+- Y-axis label: "TOTAL LABOR & EXPENSES"
+- Legend: "LABOR" (around 25,000 hours)
+- Legend: "EXPENSES" (around $15,000)
+
+A smaller inset graph within the main graph shows:
+- The y-axis ranges from 1,500 to 3,500 dollars.
+- The x-axis shows months: January, February, March.
+- Operating Expenses (Y-axis): Starts at around $1,800 in January, peaks around $2,750 in February, then decreases slightly to around $2,650 by March.
+- Office & General Expenses (Y-axis): Starts at around $1,250 in January, peaks around $1,850 in February, then decreases slightly to around $1,750 by March.
+
+Legend:
+- Legend: "OPERATING EXPENSES" (around $1,850)
+- Legend: "OFFICE & GENERAL EXPENSES" (around $1,250)
+</img>
+
+Form 56. Ratio Chart showing Production, Labor, and Expense—Silk Mill
+
+<table>
+ <tr>
+ <td colspan="10">GRAPHIC PRESENTATION OF COST DATA</td>
+ </tr>
+ <tr>
+ <td colspan="10">STATISTICAL TABLE SHOWING THE DIRECT LABOR CHARGES AND FACTORY EXPENSES AS PLOTTED IN CHART 56</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td>Yards</td>
+ <td>Produced</td>
+ <td>Largest Charges</td>
+ <td>Operating Expenses</td>
+ <td>Office and General Expenses</td>
+ <td>Total</td>
+ <td>Per Yard</td>
+ <td>Per Yard</td>
+ </tr>
+ <tr>
+ <td>1b-</td>
+ <td>December</td>
+ <td>60,630</td>
+ <td>$ 2,603.09</td>
+ <td>$ 8,167.67</td>
+ <td>$ 8,585.09</td>
+ <td>$ 8,533.06</td>
+ <td>8</td>
+ <td>14,006.</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>January</td>
+ <td>54,949</td>
+ <td>$ 2,576.92</td>
+ <td>$ 1,218.74</td>
+ <td>6,105.35</td>
+ <td>7,089.32</td>
+ <td>13</td>
+ <td>13,206.</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>February</td>
+ <td>54,472</td>
+ <td>$ 2,513.19</td>
+ <td>$ 977.46</td>
+ <td>6,848.72</td>
+ <td>7,113.19</td>
+ <td>13</td>
+ <td>13,896.</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>March</td>
+ <td>50,884</td>
+ <td>$ 2,498.84</td>
+ <td>$ 977.46</td>
+ <td>6,823.28</td>
+ <td>7,096.71</td>
+ <td>13</td>
+ <td>13,796.</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>April</td>
+ <td>47,502</td>
+ <td>$ 2,405.01</td>
+ <td>$ 1,239.28</td>
+ <table><tbody><tr><th style="text-align: right;">May:</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th></tbody></table></table></tr><tr><table><tbody><tr><th style="text-align: right;">June:</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th></tbody></table></tr><tr><table><tbody><tr><th style="text-align: right;">July:</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th></tbody></table></tr><tr><table><tbody><tr><th style="text-align: right;">August:</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th><th style="text-align: right;">$ 1,239.28</th><th style="text-align: right;">$ 2,405.01</th></tbody></table></tr><tr><table><tbody><tr><th style="text-align: right;">September:</th><table><tbody><tr><th style="text-align: left;"><span class='line_item_quantity'>7,</span></th><thead id='__annotation__rowinterval_'><tr id='__annotation__rowinterval_'><thead id='__annotation__rowinterval_'><col id='__annotation__rowinterval_'></col></thead></thead></table></tr></tbody></table></tr><tr><table><tbody><tr><th style="text-align: right;"><span class='line_item_unit_price_gross'>Average per month $<span class='line_item_currency'>$ </span></span>:</table></tr></tbody></table></tr><tr><table id='__annotation__table_3' class='annotation_table'>
+<tr id='__annotation__row_3' class='annotation_row'>
+<td id='__annotation__cell_3_0' class='annotation_column_0'>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:<br/>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:</table></tr>
+
+<tr id='__annotation__row_4' class='annotation_row'>
+<td id='__annotation__cell_4_0' class='annotation_column_0'>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:<br/>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:</table></tr>
+
+<tr id='__annotation__row_5' class='annotation_row'>
+<td id='__annotation__cell_5_0' class='annotation_column_0'>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:<br/>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:</table></tr>
+
+<tr id='__annotation__row_6' class='annotation_row'>
+<td id='__annotation__cell_6_0' class='annotation_column_0'>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:<br/>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:</table></tr>
+
+<tr id='__annotation__row_7' class='annotation_row'>
+<td id='__annotation__cell_7_0' class='annotation_column_0'>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:<br/>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:</table></tr>
+
+<tr id='__annotation__row_8' class='annotation_row'>
+<td id='__annotation__cell_8_0' class='annotation_column_0'>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:<br/>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:</table></tr>
+
+<tr id='__annotation__row_9' class='annotation_row'>
+<td id='__annotation__cell_9_0' class='annotation_column_0'>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:<br/>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:</table></tr>
+
+<tr id='__annotation__row_10' class='annotation_row'>
+<td id='__annotation__cell_10_0' class='annotation_column_0'>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:<br/>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:</table></tr>
+
+<tr id='__annotation__row_11' class='annotation_row'>
+<td id='__annotation__cell_11_0' class='annotation_column_0'>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:<br/>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:</table></tr>
+
+<tr id='__annotation__row_12' class='annotation_row'>
+<td id='__annotation__cell_12_0' class='annotation_column_0'>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:<br/>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:</table></tr>
+
+<tr id='__annotation__row_13' class='annotation_row'>
+<td id='__annotation__cell_13_0' class='annotation_column_0'>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:<br/>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:</table></tr>
+
+<tr id='__annotation__row_14' class='annotation_row'>
+<td id='__annotation__cell_14_0' class='annotation_column_0'>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:<br/>Average per month $<span class='line_item_currency'>$ </span>:<br/>Total $<span class='line_item_currency'>$ </span>:</table></tr>
+
+<tr id='__annotation__row_15' cellspacing= 'none'>
+<td colspan= '6' align=center rowspan= '6' valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top> </table>
+
+<table cellspacing= 'none'>
+<tr valign=top>&
+
+USE OF GRAPHIC CHARTS <page_number>415</page_number>
+
+that the curves approximately indicate all the figures shown on the accompanying statement at the close of each month; that is, the statement could be reconstructed from the charts to the nearest unit of 100, 1,000, etc., depending upon the division in which the curve is plotted. For the sake of exactitude and convenience the precise figures shown on the statement for the last month under review are entered on the chart shown in Form 36. As month by month the curve is extended, the figures of the preceding month are erased and those for the last period are substituted.
+
+In reading these charts the executive is primarily interested in the curves for the last month and only a glance is required to ascertain whether operations as a whole are satisfactory. Form 36, for example, plots the productive labor as examined for the period. The executive at once sees that the production of the preceding period was only maintained but increased, for the curve showing the number of yards produced has risen one-tenth of the space, or 1,000 yds., or an increase of approximately 1% over the preceding period. On the other hand, the operating and general office expenses have both dropped approximately one-twentieth of the space or one-half of 1%. Direct labor and total labor and expense tend to rise slightly as would be expected from an increase in production, but the percentage of their rise is slightly less than the percentage of increase in the yards produced—a satisfactory condition. The spaces shown in the ratio charts illustrated are usually subdivided in practice.
+
+Without going into the discussion of logarithmic theory, it may be stated here that the ratio chart depends
+
+416 GRAPHIC PRESENTATION OF COST DATA
+
+<img>
+A line graph titled "TOTAL LABOR AND EXPENSE PER VARD" shows fluctuations over time. The y-axis ranges from 0 to 18, with increments of 3. The x-axis appears to represent months or quarters, but specific dates are not visible.
+</img>
+
+<img>
+A line graph titled "DIRECT LABOR PER VARD" shows fluctuations over time. The y-axis ranges from 0 to 15, with increments of 3. The x-axis appears to represent months or quarters, but specific dates are not visible.
+</img>
+
+<img>
+A line graph titled "OPERATING EXPENSE PER VARD" shows fluctuations over time. The y-axis ranges from 0 to 7, with increments of 1. The x-axis appears to represent months or quarters, but specific dates are not visible.
+</img>
+
+<img>
+A line graph titled "DIRECT LABOR PER VARD" shows fluctuations over time. The y-axis ranges from 0 to 15, with increments of 3. The x-axis appears to represent months or quarters, but specific dates are not visible.
+</img>
+
+<img>
+A line graph titled "OPERATING EXPENSE PER VARD" shows fluctuations over time. The y-axis ranges from 0 to 7, with increments of 1. The x-axis appears to represent months or quarters, but specific dates are not visible.
+</img>
+
+Form #T. Chart showing Labor and Expense per Yardl-Silk Mill
+
+USE OF GRAPHIC CHARTS <page_number>417</page_number>
+
+on the principles of logarithms. It will be noticed that in Form 56 lines are interpolated between the main divisions. The placing of these lines is done by referring to a table of logarithms or by taking the distances from the scale on an engineer's slide rule. The distances between the lines are proportional to the logarithms of the numbers marked on the chart. Papers can be purchased already ruled with logarithm ratio charts.
+
+Form 58 gives the "perspective" view of production costs to the nearest $100, $1,000 or $10,000, as the case may be. Form 57 is a difference chart going into more detail and showing to what element of cost a rise or fall in the production cost per yard is due. Any violent fluctuations in the curves of this figure indicate unusual conditions and call for instant investigation.
+
+The curves of Form 58 are plotted from a cost statement showing the distribution of direct labor and shipping expense for the months to date. On comparing, for instance, the cost of the examining labor with the number of yards produced (Form 56), it is found that production from the beginning of the year to date has increased more than 100%, whereas the cost of examining labor has increased less than 75%. The shipping expense curve reveals violent fluctuations in the expenditures for freight and express, due to bills being held up for auditing purposes and therefore not always entered at the end of each month.
+
+The full value of the above charts can, of course, be appreciated only by the management in control of the activities which they depict. They serve, however, to illustrate the simplicity and value of this method of compressing and presenting statistical information.
+
+418 GRAPHIC PRESENTATION OF COST DATA
+
+<img>
+A line graph showing cost data over time.
+The y-axis ranges from 0 to 5,000 in increments of 1,000.
+The x-axis shows months from January to December.
+Legend:
+- TOTAL DIRECT CHARGE
+- MOVING LABOR
+- SHIPPING LABOR
+- WEAVING LABOR
+- PICKING LABOR
+- EXAMINING LABOR
+- SHIPPING EXPENSE
+
+Data points:
+- TOTAL DIRECT CHARGE: Starts at around 3,000 in January, peaks around 4,000 in July, then decreases to around 3,500 by December.
+- MOVING LABOR: Starts at around 1,500 in January, peaks around 2,500 in July, then decreases to around 1,750 by December.
+- SHIPPING LABOR: Starts at around 1,250 in January, peaks around 2,250 in July, then decreases to around 1,750 by December.
+- WEAVING LABOR: Starts at around 1,250 in January, peaks around 2,250 in July, then decreases to around 1,750 by December.
+- PICKING LABOR: Starts at around 1,250 in January, peaks around 2,250 in July, then decreases to around 1,750 by December.
+- EXAMINING LABOR: Starts at around 1,250 in January, peaks around 2,250 in July, then decreases to around 1,750 by December.
+- SHIPPING EXPENSE: Starts at around 1,250 in January, peaks around 2,250 in July, then decreases to around 1,750 by December.
+</img>
+
+Form 58. Ratio Chart showing Direct Labor and Shipping Expense—Silk Mill
+
+USE OF GRAPHIC CHARTS <page_number>419</page_number>
+
+REVIEW QUESTIONS
+
+1. What advantages does the graphic means of presentation have over ordinary statements?
+2. What two types of graphic charts are best adapted to meet the needs of the cost accountant? What are the advantages and disadvantages of each type?
+3. For what purpose are difference charts best adapted? Give two illustrations.
+4. What general principle are ratio charts based on?
+5. Which type of chart is best suited for making comparisons between pounds produced and cost of production?
+6. Which type of chart is best suited for making a comparison of the hourly earnings of piece-work operators with those of week workers?
+7. How can you tell what the percentage of increase or decrease is in a ratio chart without making an arithmetical calculation?
+8. If a line for operating expense on a ratio chart is straight, what does it indicate?
+9. From the data contained in the following table make charts on ordinary cross-section paper.
+
+Cost per Pound in Cents
+
+<table>
+ <thead>
+ <tr>
+ <th>Dyeing</th>
+ <th>Picking</th>
+ <th>Spinning</th>
+ <th>Weaving</th>
+ <th>Knitting</th>
+ <th>Finishing</th>
+ </tr>
+ </thead>
+ <tbody>
+ <tr>
+ <td>January</td>
+ <td>2.05c</td>
+ <td>2.00c</td>
+ <td>8.18c</td>
+ <td>22.74c</td>
+ <td>18.14c</td>
+ <td>18.27c</td>
+ </tr>
+ <tr>
+ <td>February</td>
+ <td>1.97</td>
+ <td>1.12</td>
+ <td>8.44</td>
+ <td>14.49</td>
+ <td>8.04</td>
+ <td>11.18</td>
+ </tr>
+ <tr>
+ <td>March</td>
+ <td>1.92</td>
+ <td>1.19</td>
+ <td>7.91</td>
+ <td>13.92</td>
+ <td>8.66</td>
+ <td>8.49</td>
+ </tr>
+ <tr>
+ <td>April</td>
+ <td>1.71</td>
+ <td>1.51</td>
+ <td>8.28</td>
+ <td>15.48</td>
+ <td>7.57</td>
+ <td>9.54</td>
+ </tr>
+ <tr>
+ <td>May</td>
+ <td>1.45</td>
+ <td>1.61</td>
+ <td>7.47</td>
+ <td>12.88</td>
+ <td>6.42</td>
+ <td>10.65</td>
+ </tr>
+ <tr>
+ <td>June</td>
+ <td>1.73</td>
+ <td>1.99</td>
+ <td>7.55</td>
+ <td>13.76</td>
+ <td>6.15</td>
+ <td>10.66</td>
+ </tr>
+ <tr>
+ <td>July</td>
+ <td>1.77</td>
+ <td>2.00c</td>
+ <td>7.73</td>
+ <td>13.98</td>
+ <td>6.80</td>
+ <td>12.51</td>
+ </tr>
+ <tr>
+ <td>August</td>
+ <td>.93c</table><table><tbody><tr><th>Sep.</th><th>.22c</th><th>.22c</th><th>.24c</th><th>.24c</th><th>.28c</th><th>.32c</th></tr><tr><th>October 20, 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x 20x
+
+<table>
+ <tr>
+ <td>490 GRAPHIC PRESENTATION OF COST DATA</td>
+ </tr>
+ <tr>
+ <td colspan="3" style="text-align:center;"><strong>THE STAR NEWSPAPER</strong></td>
+ </tr>
+ <tr>
+ <td>Month</td>
+ <td>Number of Papers Printed</td>
+ <td>Net Circulation Revenue</td>
+ <td>Aver. Net Circ. per M Papers</td>
+ </tr>
+ <tr>
+ <td>January</td>
+ <td>5,191,233</td>
+ <td>$83,654</td>
+ <td>86</td>
+ </tr>
+ <tr>
+ <td>February</td>
+ <td>4,200,085</td>
+ <td>47,132</td>
+ <td>11</td>
+ </tr>
+ <tr>
+ <td>March</td>
+ <td>4,660,068</td>
+ <td>55,464</td>
+ <td>12</td>
+ </tr>
+ <tr>
+ <td>April</td>
+ <td>5,049,323</td>
+ <td>59,624</td>
+ <td>12</td>
+ </tr>
+ <tr>
+ <td>May</td>
+ <td>5,291,188</td>
+ <td>64,002</td>
+ <td>12</td>
+ </tr>
+ <tr>
+ <td>June</td>
+ <td>5,589,338</td>
+ <td>68,338</td>
+ <td>13</td>
+ </tr>
+ <tr>
+ <td>July</td>
+ <td>5,233,692</td>
+ <td>65,486</td>
+ <td>13</td>
+ </tr>
+ <tr>
+ <td>August</td>
+ <td>4,922,141</td>
+ <td>65,561</td>
+ <td>13</td>
+ </tr>
+ <tr>
+ <td>September</td>
+ <td>4,802,616</td>
+ <td>65,119</td>
+ <td>13</td>
+ </tr>
+ <tr>
+ <td>October</td>
+ <td>5,507,916</td>
+ <td>71,208</td>
+ <td>13</td>
+ </tr>
+ <tr>
+ <td>November</td>
+ <td>5,242,746</td>
+ <td>68,298</td>
+ <td>13</td>
+ </tr>
+ <tr>
+ <td>December</td>
+ <td>4,702,274</td>
+ <td>60,800</td>
+ <td>13</td>
+ </tr>
+ <!-- Additional rows for other months -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+ <!-- ... -->
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">Month<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">Number of Columns of Advertising<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">Advertising Revenue<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">Average Revenue per Column<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">January<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">Number of Columns of Advertising<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">Advertising Revenue<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">Average Revenue per Column<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">January<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">Number of Columns of Advertising<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">Advertising Revenue<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">Average Revenue per Column<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">January<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">Number of Columns of Advertising<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">Advertising Revenue<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f0f0f0;">
+<td style="border: none; padding: .5em;">Average Revenue per Column<br><br></table>
+
+<table style="width:100%; border-collapse: collapse;">
+<tr style="background-color: #f
+
+USE OF GRAPHIC CHARTS <page_number>421</page_number>
+
+12. From the data contained in the following table prepare a ratio chart.
+
+<table>
+ <thead>
+ <tr>
+ <th colspan="3">The Star Newspaper</th>
+ </tr>
+ </thead>
+ <tbody>
+ <tr>
+ <td>Month</td>
+ <td>Number of Papers Printed on 8-Page Basis</td>
+ <td>Lbs. of Paper Used</td>
+ <td>Number of lbs. Used per M 8-Page Papers</td>
+ </tr>
+ <tr>
+ <td>January</td>
+ <td>9,457,802</td>
+ <td>1,214,000</td>
+ <td>129</td>
+ </tr>
+ <tr>
+ <td>February</td>
+ <td>7,963,124</td>
+ <td>1,032,000</td>
+ <td>131</td>
+ </tr>
+ <tr>
+ <td>March</td>
+ <td>10,028,748</td>
+ <td>1,350,000</td>
+ <td>135</td>
+ </tr>
+ <tr>
+ <td>April</td>
+ <td>10,718,524</td>
+ <td>1,416,000</td>
+ <td>132</td>
+ </tr>
+ <tr>
+ <td>May</td>
+ <td>10,483,271</td>
+ <td>1,404,000</td>
+ <td>135</td>
+ </tr>
+ <tr>
+ <td>June</td>
+ <td>9,957,626</td>
+ <td>1,246,000</td>
+ <td>128</td>
+ </tr>
+ <tr>
+ <td>July</td>
+ <td>8,956,809</td>
+ <td>1,172,000</td>
+ <td>131</td>
+ </tr>
+ <tr>
+ <td>August</td>
+ <td>7,806,503</td>
+ <td>974,000</td>
+ <td>128</td>
+ </tr>
+ <tr>
+ <td>September</td>
+ <td>8,873,164</td>
+ <td>1,142,000</td>
+ <td>129</td>
+ </tr>
+ <tr>
+ <td>October</td>
+ <td>12,017,490</td>
+ <td>1,544,000</td>
+ <td>128</td>
+ </tr>
+ <tr>
+ <td>November</td>
+ <td>11,207,081</td>
+ <td>1,418,000</td>
+ <td>128</td>
+ </tr>
+ <tr>
+ <td>December</td>
+ <td>10,497,696</td>
+ <td>1,316,000</td>
+ <td>126</td>
+ </tr>
+ </tbody>
+</table>
+
+<img>A table showing the number of papers printed on 8-page basis and the corresponding number of lbs. used per month.</img>
+
+| Month | Number of Papers Printed on 8-Page Basis | Lbs. of Paper Used | Number of lbs. Used per M 8-Page Papers |
+|---|---|---|---|
+| January | 9,457,802 | 1,214,000 | 129 |
+| February | 7,963,124 | 1,032,000 | 131 |
+| March | 10,028,748 | 1,350,000 | 135 |
+| April | 10,718,524 | 1,416,000 | 132 |
+| May | 10,483,271 | 1,404,000 | 135 |
+| June | 9,957,626 | 1,246,000 | 128 |
+| July | 8,956,809 | 1,172,000 | 131 |
+| August | 7,806,503 | 974,000 | 128 |
+| September | 8,873,164 | 1,142,000 | 129 |
+| October | 12,017,490 | 1,544,000 | 128 |
+| November | 11,207,081 | 1,418,000 | 128 |
+| December | 10,497,696 | 1,316,000 | 126 |
+
+The table shows the number of papers printed on an eight-page basis and the corresponding number of pounds used per month for each month from January to December. The total number of pounds used per month ranges from approximately 974 pounds in August to about 3 million pounds in December.
+
+<img>A blank page with a faint vertical line on the right side.</img>
+
+INDEX
+
+A
+Accident insurance, 238
+Account (See also "Accounts," "Controlling accounts")
+chart of accounts, 305, 306
+illustrated, 320, 300
+"insurance," illustrated, 102
+profit and loss, 109
+rent expense, 101
+journal entry illustrated, 107
+work in process, 79, 83
+costs, 85, 90
+illustrated, 85, 90
+journal entry illustrated, 107
+production-center system, illustrated, 324
+textile costs, 369-376, 366-370
+Accounting cost (See "Cost accounting")
+stores, 122-141 (See also "Stores")
+adjustment between actual and applied expense, 212, 283
+Form, 19, 20
+controlling (See also "Controlling accounts")
+balances, 108
+closing, 106-112
+departmentalization of A. S. T., 227
+ratification of system, 234-361
+expense, indirect, 315-316, 217,
+221, 293, 294-242, 568, 310
+(See also "Expense indirect")
+chart, 312, 310
+Forma, 19, 20; 214-216; 312; 313
+illustrated, 103-104
+journal entries, 105-108
+
+opening, 88
+process system, 89; 106-108; 269,
+271; 344
+production-center system, illus-
+trated, 324-242 (See also "Fixed charges")
+inventory, fixed charges, 294-242 (See also "Fixed charges")
+inventory system, fixed charges,
+inventory system, fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixed charges,
+inventory system fixedcharges
+
+<page_number>424</page_number>
+INDEX
+
+Administrative expense—Continued
+on distribution sheet, 224, 253,
+260
+production-center system, 291
+account illustrated, 382
+standing expense orders, 220
+subdepartmentalized
+Advertising expense, 217, 220
+Analysis (See also "Classification")
+—"Schedule"
+expense, indirect (See "Expense,
+indirect, distribution")
+pay-roll (See "Pay-roll")
+Analysis of textile costs (See under "Textile costs")
+Applied rates of expense distribu-
+tion, 215, 271-280 (See also un-
+der "Expense, indirect; distribu-
+tion over product")
+adjustments to actual and,
+212, 285-285, 290
+Assembly products, 66
+Aspects, production ("Plant")
+Automobile factory, inventory sheet, 121
+Form, 120
+
+B
+
+Balance sheet.
+entry of inventory accounts, 79
+Bill of material, 155, 304
+Form(s), 135, 304
+Bin tag, 138
+Form(s), 138
+Block system of classification, 156
+Boiler insurance, 238
+Bonus system of wage payment, 204
+Books (See "Plant")
+Breakfast-food factory, 42
+Brick manufacturing plant, 44, 90, 87,
+328-338 (See also under "Proc-
+ess cost system")
+Building (See "Plant")
+
+Building expense, 236, 237
+account illustrated,
+production-center system, 289,
+319
+textile costs, 385
+Burden (See "Expense indirect")
+By-products, 147
+
+C
+
+Candy factory, cost system, 19
+Castings, 60
+Catalog stores, 161
+Cement manufacture, 88, 92
+Charges (See "Costs")
+Charts,
+accounts, 20
+Form, 20, 21
+production-center system, 310
+elements of selling price, 319
+elements of selling price, 25
+Form(s), Form(s)
+expenses accounted for,
+production-center system, 310
+Forms,
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(s), Form(s)
+Form(ies),
+accounts,
+accounting system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+cost system,
+
+Advantages, 405
+difference, 406-409
+Forms, Forms, Forms
+pay-roll, 191
+Forms, Forms, Forms
+plotted from statements, 414.
+plus ratio., plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ratio.,
+plus ratio., plus ration.
+Checking figure.
+Classification.
+accounts process cost system.
+385
+
+expense indirect.
+
+INDEX
+
+<page_number>425</page_number>
+
+Classification—Continued
+invoices, indirect expense, 217
+indirect ledger, 218
+Form, 21
+labor, 166-168
+labor cost, 211
+material requisitions, 331
+parts, 303
+standing expense orders, 229-232,
+297
+numerical system, 290-292
+stores, 123, 158, 153-162 (See also "Stores")
+Clay products (See "Process cost system, brick-making plant")
+Cleaning costs, 180
+Card, 167, 108, 176
+Form, 181
+
+Closing accounts, illustrated, 106-109
+process cost system, 106-109
+Statement of manufacturing profit and loss, 110
+work in process account, process method, 185
+Clothing factory, 42
+piece-work time record, 183
+
+Cloth manufacture (See "Textile cost")
+Combined process and order method of finding, 48
+Commercial accounting, distinct from cost accounting, & comparison of cost at various peri-
+ods, 66
+Competition, ignorant, due to in-
+correct cost calculation, 6
+Comparative accounts, 54-55
+Form, 57, 80
+Controlling accounts, 77 (See also "Ledger") balances, 108
+checking figures, 96
+
+closing, illustrated, 106-109
+process cost system, 106-109
+costs, 81-82
+expense, indirect (See "Expense,
+indirect, accounts") finished goods, 79
+textiles, illustrated, 86
+journal entry, illustrated, 108
+production-cost system, 81
+production-center system, illus-
+trated, 325
+finished parts, 86
+materials costs, $x$, $y$, $z$ (See "Materials")
+entrys., 81
+estimated cost system, illus-
+trated, 85
+
+Journal entries, illustrated, 106
+process cost system, 86
+(textile costs), $x$, $y$, $z$, $w$
+pay-rolls.
+illustrated., 93
+journal entries, illustrated., 107
+process cost system., 88
+production-center system., 323
+textile costs.
+process cost systems., $a$, $b$, $c$,
+$d$, $e$ (See "Production-cost sys-
+tem.")
+production-center system., $f$, $g$,
+$h$, $i$ (See "Production-center sys-
+tem.")
+chart., $j$
+textile costs., $k$, $l$, $m$, $n$,
+$p$, $q$ (See "Production-cost sys-
+tem.")
+illustrated accounts., $r$, $s$, $t$,
+$u$, $v$, $w$ (See "Production-cost sys-
+tem.")
+stores (See subheading above),
+"Material"!
+suppliers' accounts.
+journal entries, illustrated., 106
+process cost system., 88
+work in process., 79, 83
+
+entries.
+illustrated., $x$, $y$, $z$ (See "Production-cost system.")
+journal entry. illustrated., 107
+process cost system.
+closing account., 90
+textile costs., $36$, $37$, $38$
+
+<page_number>486</page_number>
+INDEX
+
+Conversion costs, 88, 92
+accounts, 93
+distributed over yarn cost, tex-
+tile mill, 976
+statement, 305
+Copper smelter, 42
+Cost,
+conversion (See under "Costs")
+prime, 16
+total, 16, 25
+Cost accounting,
+breakfast-food factory, 42
+brick manufacturer, 46, 50, 87
+illustrated system, 328-345
+encyclopedia system, 43, 185
+clothing factory, 43, 185
+Form, 180
+combined job order and process
+system, 48 (See also "Textile costs")
+compound products, 54-60
+copper smelter, 42
+definition, 3
+distinct from commercial, 4
+efficiency standards laid down by,
+5, 7
+estimated cost system, 63-65, 840-
+305
+filling mill, 305
+foundries, 50, 147, 261
+Form,
+functions of, 5-11
+hat factory, 55
+Forma, 87
+ice factory, 12
+illustrated systems, 301-401
+importance of, 3
+inventory perpetual, maintained by,
+5, 7
+job order system, 19, 41, 47-52
+production-center system, 398,
+production-center illustrated,
+electrical goods, 301-327
+records, 29
+textile costs, illustrated, 305-401
+
+multiple parts products, 66
+"needle" industries, 65
+pattern mill, 43
+peripheries of, 13
+printing plant, 33, 42-192
+Form,
+20,
+process system, 12, 43-49,
+86-95
+brick manufacturing, 45, 90, 87
+brick manufacturing illustrated,
+308-364
+textile costs illustrated, 363
+prices of different lines indicated by,
+57,
+shoe factory, 58, 63
+Form,
+59,
+shortages and loss. simple products,
+41-58
+stock products. stocks.
+costs. products. stock products.
+stocks. trading concern. trading concern.
+trading concern. trading concern.
+uniform system. uniform system.
+system. system.
+when necessary. when necessary.
+yearly cost. year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year's cost. year's cost.
+year'
+
+INDEX
+
+<table>
+ <tr>
+ <td>Cost records, 29 (see also "Rec- erded")</td>
+ <td>D</td>
+ </tr>
+ <tr>
+ <td>Cost sheets, 30, 58, 76 (See also "Cost ledger")</td>
+ <td>Day-rate method of wage payment,</td>
+ </tr>
+ <tr>
+ <td>Formula, 35</td>
+ <td>164</td>
+ </tr>
+ <tr>
+ <td>material recorded on, 131</td>
+ <td>disadvantages of, 185-197</td>
+ </tr>
+ <tr>
+ <td>proof of, 192</td>
+ <td>Detailed system of stores classifica- tion, stores classification,</td>
+ </tr>
+ <tr>
+ <td>production-center systems, 308</td>
+ <td>Defective work, 146</td>
+ </tr>
+ <tr>
+ <td>Purchase record of issues, 138</td>
+ <td>Deferred expense (See "Prepaid expenses")</td>
+ </tr>
+ <tr>
+ <td>requisitions posted to, 306</td>
+ <td>Departmentalization of accounts, 5,</td>
+ </tr>
+ <tr>
+ <td>Cost summary, production system, 347</td>
+ <td>7, 22</td>
+ </tr>
+ <tr>
+ <td>Forma, 348</td>
+ <td>Departments,</td>
+ </tr>
+ <tr>
+ <td>Costs (See also "Cost accounting") comparison of, at various periods,</td>
+ <td>administrative (See also "Administrative expenses")</td>
+ </tr>
+ <tr>
+ <td>conversion, 86, 92</td>
+ <td>sub-departments, 265</td>
+ </tr>
+ <tr>
+ <td>accounts, 83</td>
+ <td>Distribution of indirect expense over (See under "Expense, in- direct")</td>
+ </tr>
+ <tr>
+ <td>distributing yarn cost, tex- tile mill, 376</td>
+ <td>non-productive, 102, 268 (See also "Administrative expense,")</td>
+ </tr>
+ <tr>
+ <td>statement of, 93</td>
+ <td>"Building expense," "Power plant expense," "Stores" de- partment expense,</td>
+ </tr>
+ <tr>
+ <td>departmentalization of all, pro- duction cost system estimates (See "Estimated cost system") distribution of indirect ex- pense, 99, 103, 107, 257-270 sub-departments, 265-268</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>extenuating material, 63</td>
+ <td>(See also "Labor") office (See "Administrative ex- pense")</td>
+ </tr>
+ <tr>
+ <td>(See also "Labor") indirect,</td>
+ <td>power plant (See "Power plant expenses")</td>
+ </tr>
+ <tr>
+ <td>indirect selling charge, chart, 25</td>
+ <td>process cost system (See "Proc- ess cost system")</td>
+ </tr>
+ <tr>
+ <td>(See also "Material") direct,</td>
+ <td>procurement expense,</td>
+ </tr>
+ <tr>
+ <td>directly,</td><table><tbody><tr><th colspan="2">D</th></tr><tr><th colspan="2">cost system (See "Process cost sys-</th></tr><tr><th colspan="2">tem"), See "Process cost system"</th></tr><tr><th colspan="2">process cost system (See "Process cost sys-</th></tr><tr><th colspan="2">tem"), See "Process cost system"</th></tr><tr><th colspan="2">process cost system (See "Process cost sys-</th></tr><tr><th colspan="2">tem"), See "Process cost system"</th></tr></tbody></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table></table/></div>
+
+<table cellspacing="0">
+<tr style="height: auto;">
+<td style="width:50%; height: auto;">
+<p style="margin-top: -1em;">Cost records, conversion costs (See also "Tex- tile costs") production report, weekly.</p>
+
+<p style="margin-top: -1em;">Formula, $45.</p>
+
+<p style="margin-top: -1em;">Forma, $45.</p>
+
+<p style="margin-top: -1em;">Coupon production order.</p>
+
+<p style="margin-top: -1em;">Forma, $90.</p>
+
+<p style="margin-top: -1em;">spending account (See also "Tex- tile costs") production report, weekly.</p>
+
+<p style="margin-top: -1em;">Formula, $45.</p>
+
+<p style="margin-top: -1em;">Forma, $45.</p>
+
+<p style="margin-top: -1em;">Coupon production order.</p>
+
+<p style="margin-top: -1em;">Forma, $90.</p>
+
+<p style="margin-top: -1em;">spending account (See also "Tex- tile costs") production report, weekly.</p>
+
+<p style="margin-top: -1em;">Formula, $45.</p>
+
+<p style="margin-top: -1em;">Forma, $45.</p>
+
+<p style="margin-top: -1em;">Coupon production order.</p>
+
+<p style="margin-top: -1em;">Forma, $90.</p>
+
+<p style="margin-top: -1em;">spending account (See also "Tex- tile costs") production report, weekly.</p>
+
+<p style="margin-top: -1em;">Formula, $45.</p>
+
+<p style="margin-top: -1em;">Forma, $45.</p>
+
+<p style="margin-top: -1em;">Coupon production order.</p>
+
+<p style="margin-top: -1em;">Forma, $90.</p>
+
+<p style="margin-top: -1em;">spending account (See also "Tex- tile costs") production report, weekly.</p>
+
+<p style="margin-top: -1em;">Formula, $45.</p>
+
+<p style="margin-top: -1em;">Forma, $45.</p>
+
+<p style="margin-top: -1em;">Coupon production order.</p>
+
+<p style="margin-top: -1em;">Forma, $90.</p>
+
+<p style="margin-top: -1em;">spending account (See also "Tex- tile costs") production report, weekly.</p>
+
+<p style="margin-top: -1em;">Formula, $45.</p>
+
+<p style="margin-top: -1em;">Forma, $45.</p>
+
+<p style="margin-top: -1em;">Coupon production order.</p>
+
+<p style="margin-top: -1em;">Forma, $90.</p>
+
+<p style="margin-top: -1em;">spending account (See also "Tex- tile costs") production report, weekly.</p>
+
+<p style="margin-top: -1em;">Formula, $45.</p>
+
+<p style="margin-top: -1em;">Forma, $45.</p>
+
+<p style="margin-top: -1em;">Coupon production order.</p>
+
+<p style="margin-top: -1em;">Forma, $90.</p>
+
+<p style="margin-top: -1em;">spending account (See also "Tex- tile costs") production report, weekly.</p>
+
+<p style="margin-top: -1em;">Formula, $45.</p>
+
+<p style="margin-top: -1em;">Forma, $45.</p>
+
+<p style="margin-top: -1em;">Coupon production order.</p>
+
+<p style="margin-top: -1em;">Forma, $90.</p>
+
+<p style="margin-top: -1em;">spending account (See also "Tex- tile costs") production report, weekly.</p>
+
+<p style="margin-top: -1em;">Formula, $45.</p>
+
+<p style="margin-top: -1em;">Forma, $45.</p>
+
+<p style="margin-top: -1em;">Coupon production order.</p>
+
+<p style="margin-top: -1em;">Forma, $90.</p>
+
+<p style="margin-top: -1em;">spending account (See also "Tex- tile costs") production report, weekly.</p>
+
+<p style="margin-top: -1em;">Formula, $45.</p>
+
+<p style="margin-top: -1em;">Forma, $45.</p>
+
+<p style="margin-top: -1em;">Coupon production order.</p>
+
+<p style="margin-top: -1em;">Forma, $90.</p>
+
+<p style="margin-top: -1em;">spending account (See also "Tex- tile costs") production report,</page_number>
+
+# 428 INDEX
+
+Departments—Continued
+shipping expense, 303
+chart, graphic, 417
+Form, 418
+stores (See "Stores")
+sub-
+non-productive, 205-206
+productive (machine groups), 278, 290
+"Machine rate method of distribu-
+ting expense over product"
+Depreciation, 98, 100, 344-352 (See also "Fixed charges")
+account, 223
+auxiliary equipment, 240
+journal entries illustrated, 107
+mechanical, 290
+obsoleteance, 245
+production-center system, 290
+rates, 247
+schedule, 234, 236, 239, 253
+Form, 295, 306
+idle-production, 266
+textile costs, 387, 388
+Dewey decimal system of classifica-
+tion,
+Difference charts, 466-469
+Form, 408, 411
+Different pictorial method of
+wage payment, 200
+Direct expense, 18
+Direct labor, 18 (See also "Labor," "Payroll")
+chart, graphic, 407-417
+Form, 408, 413, 414
+Distribution of cost related to prod-
+uct, process cost system, 44, 92
+Distribution of expense (See "Ex-
+penditure," direct)
+Drafting expense account, illus-
+trated, 396
+
+E Efficiency, standard of, laid down by cost accounting, 5, 7
+
+Electrical goods factory, illustrative production-center system, 301-302
+Electricity expense, 233, 239 (See also generally "Fixed charges," "Lighting")
+Employer's liability insurance, 238
+Engineering plant expense distribu-
+tion, 257-258
+Form, 313, 317, 225
+depreciation, 244-252
+cost system, 63-65, 549-550
+adjustment illustrated, 359-360
+estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at actual and estimated costs illustrated at实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本��实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，实际和估计的成本，
+Illustrated entries: I-104-106 opening: I-8 process cost system: I-89-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-106,
+I-
+
+INDEX
+
+<page_number>429</page_number>
+
+Expense, indirect--Continued
+accounts--Continued
+textile costs, 367, 383-389 (See also "Other textile costs")
+accrued expense, 88, 100
+adjustment between actual and
+projected labor cost, 253
+flat percentage charge, 284
+production-center system, 295
+revenue center method, 272
+administrative expense, 18, 96,
+102, 168, 172, 187, 213, 220,
+221 (See also generally sub-
+heading below, "Labor, indi-
+rect")
+on distribution system, 234, 253,
+254
+process cost system, 166, 344
+Forma, 344
+production-center system, 291,
+321
+standing expense orders, 226
+sub-departments, 265
+sub-departments, advertising,
+217, 220
+expense, activity, extent of 31
+upward adjustment, sub-heading
+below,
+"Rates of distribution, predeter-
+mined"
+accounting expenses, 265, 277
+production-center system, 289,
+319
+chart of accounts, 305
+Chart of Accounts (C.O.A.), 310,
+314-316 (See also "General ledger")
+costs of goods sold (C.G.S.), 310,
+314-316 (See also "General ledger")
+costs of merchandise inventory (C.M.I.), 310,
+314-316 (See also "General ledger")
+departmental overhead rates,
+percentage of labor method,
+272-275
+departmental overhead rates,
+productive-hour method,
+272, 275-277
+departmental overhead rates,
+rate predetermined, 45, 212,
+271-275 (See also "Fixed charges")
+departmental overhead rates,
+sold-hour method, 272, 279
+accounting expenses, 265, 277
+auxiliary equipment, 246
+journal entry, illustrated,
+300-301
+machinery, 280
+obsolescence, 295
+production-center system, 290
+productivity rate method,
+rates, 247
+schedule, 324, 344, 293, 295
+Forma., 340-341
+schedule of textile costs, 307,
+398
+sub-departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+departmental overhead rates,
+
+<table>
+<tr><td>Expense</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</td><td>accounting expenses</td><td>accounting expenses</td></tr>
+<tr><td>accounting expenses</ td<td colspan="3">table header: account number | account type | account description | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value | account value |
+| & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & & &
+|<br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br>
+|></table>
+
+<table>
+<tr>
+<td colspan="5">INDEX - Continued - Textile Costs - Other Textile Costs - Administrative Expense - Labor Indirect - Distribution System - Process Cost System - Production Center System - Standing Expense Orders - Sub-Departments - Advertising - Forma - Activity - Upward Adjustment Below - Rates of Distribution Predetermined - Accounting Expenses - Auxiliary Equipment - Journal Entry Illustrated - Machinery - Obsolescence - Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method Account Number Account Type Account Description Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value Account Value
+
+<table>
+<tr>
+<td colspan="5">INDEX - Continued - Textile Costs - Other Textile Costs - Administrative Expense - Labor Indirect - Distribution System - Process Cost System - Production Center System - Standing Expense Orders - Sub-Departments - Advertising - Forma - Activity - Upward Adjustment Below - Rates of Distribution Predetermined - Accounting Expenses - Auxiliary Equipment - Journal Entry Illustrated - Machinery - Obsolescence - Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX - Continued - Textile Costs - Other Textile Costs - Administrative Expense - Labor Indirect - Distribution System - Process Cost System - Production Center System - Standing Expense Orders - Sub-Departments - Advertising - Forma - Activity - Upward Adjustment Below - Rates of Distribution Predetermined - Accounting Expenses - Auxiliary Equipment - Journal Entry Illustrated - Machinery - Obsolescence - Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX - Continued - Textile Costs - Other Textile Costs - Administrative Expense - Labor Indirect - Distribution System - Process Cost System - Production Center System - Standing Expense Orders - Sub-Departments - Advertising - Forma - Activity - Upward Adjustment Below - Rates of Distribution Predetermined - Accounting Expenses - Auxiliary Equipment - Journal Entry Illustrated - Machinery - Obsolescence - Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX - Continued - Textile Costs - Other Textile Costs - Administrative Expense - Labor Indirect - Distribution System - Process Cost System - Production Center System - Standing Expense Orders - Sub-Departments -
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost System Production Center System Standing Expense Orders Sub-Departments Advertising Forma Activity Upward Adjustment Below Rates of Distribution Predetermined Accounting Expenses Auxiliary Equipment Journal Entry Illustrated Machinery Obsolescence Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost System Production Center System Standing Expense Orders Sub-Departments Advertising Forma Activity Upward Adjustment Below Rates of Distribution Predetermined Accounting Expenses Auxiliary Equipment Journal Entry Illustrated Machinery Obsolescence Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost System Production Center System Standing Expense Orders Sub-Departments Advertising Forma Activity Upward Adjustment Below Rates of Distribution Predetermined Accounting Expenses Auxiliary Equipment Journal Entry Illustrated Machinery Obsolescence Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost System Production Center System Standing Expense Orders Sub-Departments Advertising Forma Activity Upward Adjustment Below Rates of Distribution Predetermined Accounting Expenses Auxiliary Equipment Journal Entry Illustrated Machinery Obsolescence Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost System Production Center System Standing Expense Orders Sub-Departments Advertising Forma Activity Upward Adjustment Below Rates of Distribution Predetermined Accounting Expenses Auxiliary Equipment Journal Entry Illustrated Machinery Obsolescence Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost System Production Center System Standing Expense Orders Sub-Departments Advertising Forma Activity Upward Adjustment Below Rates of Distribution Predetermined Accounting Expenses Auxiliary Equipment Journal Entry Illustrated Machinery Obsolescence Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost System Production Center System Standing Expense Orders Sub-Departments Advertising Forma Activity Upward Adjustment Below Rates of Distribution Predetermined Accounting Expenses Auxiliary Equipment Journal Entry Illustrated Machinery Obsolescence Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost System Production Center System Standing Expense Orders Sub-Departments Advertising Forma Activity Upward Adjustment Below Rates of Distribution Predetermined Accounting Expenses Auxiliary Equipment Journal Entry Illustrated Machinery Obsolescence Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost System Production Center System Standing Expense Orders Sub-Departments Advertising Forma Activity Upward Adjustment Below Rates of Distribution Predetermined Accounting Expenses Auxiliary Equipment Journal Entry Illustrated Machinery Obsolescence Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost System Production Center System Standing Expense Orders Sub-Departments Advertising Forma Activity Upward Adjustment Below Rates of Distribution Predetermined Accounting Expenses Auxiliary Equipment Journal Entry Illustrated Machinery Obsolescence Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost System Production Center System Standing Expense Orders Sub-Departments Advertising Forma Activity Upward Adjustment Below Rates of Distribution Predetermined Accounting Expenses Auxiliary Equipment Journal Entry Illustrated Machinery Obsolescence Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost System Production Center System Standing Expense Orders Sub-Departments Advertising Forma Activity Upward Adjustment Below Rates of Distribution Predetermined Accounting Expenses Auxiliary Equipment Journal Entry Illustrated Machinery Obsolescence Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost System Production Center System Standing Expense Orders Sub-Departments Advertising Forma Activity Upward Adjustment Below Rates of Distribution Predetermined Accounting Expenses Auxiliary Equipment Journal Entry Illustrated Machinery Obsolescence Production Center System Productivity Rate Method Rates Schedule Schedule of Textile Costs Department Overhead Rates Percentage of Labor Method Productive Hour Method Rate Predetermined Sold Hour Method
+
+<table>
+<tr>
+<td colspan="5">INDEX Continued Textile Costs Other Textile Costs Administrative Expense Labor Indirect Distribution System Process Cost Sys
+
+<page_number>430</page_number>
+INDEX
+
+Expense, indirect—Continued
+distribution sheet, 29, 36, 38, 335-370
+Forms, 271, 254, 255, 258, 259,
+262, 263
+administrative expenses, 250
+depreciation (See subheading
+above), "Depreciation sched-
+ule"
+fixed charges (See subheading
+below), "Fixed charges sched-
+ule"
+power plant, 260
+standing orders and supplies
+requisitions distributed on,
+225
+statement of expenses, produc-
+tion-center system, 308
+Form, 307
+stores department expense, 260,
+264
+stores department expense ap-
+plied direct to material, 358
+sub-departments, 265-268
+electricity, 258, 258 (See also
+housing costs), "Fixed charges",
+"Light and heat"
+equipment, 215, 217, 222
+estimated cost system (See "Esti-
+mated cost system")
+fixed charges, 213, 217, 235-243
+(See also "Fixed charge")
+account" illustrated in produc-
+tion-center system, 320
+schedule, 254, 253, 255
+Form, 307
+schedule, process system, 341
+Form, 342
+schedule, sub-departments, 266
+gas, 215, 231, 239 (See also
+generally subheadings "Fixed
+charges", "Light and heat")
+"general expense account"
+fabric costs, 361
+
+Insurance, 98, 100, 213, 217, 238,
+298 (See also generally subheadings above), "Fixed charge(s)"
+account illustrated, 102
+production-center system, 107
+textile costs, 389
+interest on investment, 240 (See also subheading above), "Fixed charges"
+journal entries illustrated, 106-
+108
+labor, indirect, 168, 168, 213, 290,
+296-297
+account illustrated, 211
+"Administrative ex-
+penses"
+chart of accounts graphic, 191
+Form, 193
+classification, 221
+income statement illustrated,
+repair to machinery, 241,
+296 standing expenses order,
+244-245 ledger subsidiary,
+218, 266, 267 Form,
+Form,
+estimated cost system, 348
+process center system, 345 Form,
+Form,
+heat and light, 296-98 (See also generally subheadings above), "Electri-
+city", "Gas"
+account illustrated, production-
+center system, 380
+account illustrated fabric costs,
+361 machine-rate method of dis-
+tribution (See "Machine-rate method")
+machinery, 213, 217, 299 (See also "Machine-rate method")
+depreciation, 346-349 expense account, 296-303
+
+INDEX
+
+Expense, indirect—Continued
+machinery—Continued
+inventory, 207
+power expense, distribution, 260
+taxes, 290
+non-productive departments (See also "Administrative" expenses)
+"Power plant expense," "Stores department" accounts, 102, 268
+chart, 212
+Form, 214
+distribution of expenses, 99, 103,
+104, 257-270
+sub-departments, 255-269
+costs (See also subheading above,
+"Administrative" expense")
+account, textile costs, 307
+"overhead" account, illustrated, 101
+plant assets, 218, 217, 229
+plant labor cost, 260
+power expense
+textile costs, 304
+power plant expense, 98, 99, 102
+account, illustrated, 103
+journal entry, illustrated, 107
+distribution cost system, 344
+production-center system, 389
+Form, 214
+prepaid expense, 98, 101, 217
+production-center system (See "Machine-rate method")
+product-cost departments, 103-105,
+212
+account illustrated, 344
+Form, 214, 215
+distribution of expense over,
+98, 103 (See also sub-
+heading above, "Distribution")
+journal entry, illustrated, 107
+purchase journal, 213, 217, 224,
+238
+rates of distribution, predeter-
+mined, 42, 212, 271-285
+records, 235 (See also individual accounts)
+rental income account illustrated, 101
+journal entry, illustrated, 107
+production-center system, 389
+reserve account, illustrated,
+classification, 237, 299-302
+distribution sheet, 324
+distribution, sub-departments,
+366
+list of members, 257, 299
+Form, 293
+time ticket form, 227
+Form, 298
+statement of production-center system,
+368
+Form, 368
+stores department expense,
+98,
+102 account,
+illustrated,
+production-
+center system,
+367 spread to material,
+568,
+367,
+302 on distribution sheet,
+265-266 sub-departments,
+366 discount received before receipt,
+150 stores ledger,
+318 sub-departments,
+555-568 (See also "Machine-rate method")
+supplies,
+17,
+313,
+217,
+291,
+295-298 account,
+81,
+123 charged direct; unusual method,
+
+<table>
+<thead>
+<tr>
+<td>Index</td>
+<td>Page Number</td>
+</tr>
+</thead>
+<tbody>
+<tr>
+<td>Expense</td>
+<td>431</td>
+</tr>
+<tr>
+<td>Expense indirect - Continued</td>
+<td></td>
+</tr>
+<tr>
+<td>Machinery - Continued</td>
+<td></td>
+</tr>
+<tr>
+<td>Inventory</td>
+<td>207</td>
+</tr>
+<tr>
+<td>Power Expense Distribution</td>
+<td>260</td>
+</tr>
+<tr>
+<td>Taxes</td>
+<td>290</td>
+</tr>
+<tr>
+<td>Non-productive Departments (See also "Administrative" Expenses)</td>
+<td></td>
+</tr>
+<tr>
+<td>"Power Plant Expense", "Stores Department" Accounts</td>
+<td>102,</td>
+</tr>
+<tr>
+<td>Chart</td>
+<td>212</td>
+</tr>
+<tr>
+<td>Form</td>
+<td>214</td>
+</tr>
+<tr>
+<td>Distribution of Expenses</td>
+<td>99,</td>
+</tr>
+<tr>
+<td>Sub-departments</td>
+<td>104,</td>
+</tr><tr>
+<td>Costs (See also Subheading Above,"Administrative" Expense")</td>
+<td></td>
+</tr><tr>
+<td>Account Textile Costs</td>
+<td>307</td>
+</tr><tr>
+<td>"Overhead" Account Illustrated</td>
+<td>101</td>
+</tr><tr>
+<td>Plant Assets</td>
+<td>Illustrated:</td><td>Plant Assets: Form: Distribution Cost System: Production Center System: Time Ticket Form: Statement of Production Center System: Stores Department Expense: Account: Spread to Material: On Distribution Sheet: Sub-Departments: Discount Received Before Receipt: Stores Ledger: Sub-Departments:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></ td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td td </table>
+
+<table border="1">
+<thead>
+<tr style="background-color: #f0f0f0;">
+<th>Description</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th>
+<th>Page Number(s)</th>
+<th>Description (continued)</th><br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/>
+<br/
+
+<table>
+ <tr>
+ <td style="text-align: right;">452</td>
+ <td style="text-align: left;">INDEX</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td>Expense, indirect--Continued<br>supplies--Confessed<br>included in term "stores," 23<br>journal entry, illustrated, 106<br>posting to stores issued book, 138<br>process cost system, 68<br>production-center system, 291, 325<br>requisition, 224, 233<br>standardized expense orders, 224, 235-236<br>Form, 230<br>taxes, 98, 100, 215, 235, 238 (See also generally subheading above, "Fixed charges")<br>account, illustrated, textile costs, 391<br>definition, 24<br>inventory or record, 75, 96<br>ledger, 77<br>Form, 78<br>fiscal account (stores), 67, account, 66<br>definition, 24<br>Fixed charges--cost period, 22<br>Fixed charges, 215, 217, 235-236<br>"account," illustrated, production-cost system, 397<br>billing schedule, 235, 237<br>production-center system, 289<br>S19<br>textile costs, 285<br>depreciation, 98, 100, 244-252<br>account, 229<br>adjustment journal entry, 246<br>journal entry, illustrated, 107<br>machine charge, 290<br>obsolescence, 245<br>production-cost system, 290 rates, 247<br>schedule, 224, 234, 240-253<br>Form, 311<br>schedules--subdepartments, 365 schedule, textile costs, 307, 308 electricity, 285-289 (See also generally subheading below,"Light and heat")<br>Form No. S-19 (See also generally subheading below,"Light and heat")<br>insurance, 98, 100, 213, 217, 233,<br>account, illustrated,</td>
+ <td style="text-align: center;">
+ Finished goods,<br>account,<br>illustrated,<br>journal entry,<br>illustrated,<br>process cost system,<br>91<br>production-center system,<br>illustrated,<br>S19<br>definition,<br>inventory or record,<br>75-76<br>ledger,<br>77<br>Form,<br>78<br>fiscal account (stores),<br>67,<br>account,<br>66<br>definition,<br>24<br>Fixed charges--cost period,<br>22<br>Fixed charges,<br>215,<br>217,<br>235-236<br>"account," illustrated,<br>production-cost system,<br>397<br>billing schedule,<br>235,<br>237<br>production-center system,<br>system,<br>S19<br><br><table>
+ <thead>
+ <tr>
+ <th>Description</th>
+ <th></th>
+ <th></th>
+ </tr>
+ </thead>
+ <tbody>
+ <tr>
+ <td colspan="3">Factory:</td>
+ </tr>
+ <tr>
+ <td colspan="3">lodges,</td>
+ </tr>
+ <tr>
+ <td colspan="3">controlled by general ledger,</td>
+ </tr>
+ <tr>
+ <td colspan="3">estimated cost system,</td>
+ </tr>
+ <tr>
+ <td colspan="3">process cost system,</td>
+ </tr>
+ <tr>
+ <td colspan="3">Form No. S-19 (See also "Process cost system", brick-making plant)</td>
+ </tr>
+ </tbody>
+</table>
+
+Extracted records (See also "Records") controlled by general ledger,</td>
+ <td style="text-align: center;">F</td>
+ <td style="text-align: center;">account illustrated,</td>
+ <td style="text-align: center;">102</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</td>
+ <td style="text-align: center;">index.</ td
+
+INDEX 433
+
+Fixed charges—Continued
+insurance—Continued
+journal entry, illustrated, 107
+production-center system, 290
+textile costs, account illustrated,
+107
+interest on investment, 240
+light and heat, 265, 304 (See also subheadings below, "Electricity")
+rent, 98, 100, 235, 236
+account, illustrated, 101
+journal entry, illustrated, 101
+production-center system, 290
+schedule, 294, 293, 293
+
+Form 1
+process system, 341
+Form, 342
+sub-departments, 290
+taxes, 98, 101, 233, 238
+journal entry, illustrated, 107
+production-center system, 290
+textile costs, account illustrated,
+305
+telephone, 213, 233
+water, 258, 265
+
+Fixed cost expense distribution
+(See "Rates of expense distribu-
+tion")
+
+Fluctuations:
+prices of stores, 182
+weight or volume of material, 144
+Forecasts:
+defective castings, 117
+expense, 261
+production order, 50
+Form, 51
+store classification, 154
+Freight expense, stores, 190
+
+Gantt system of wage payment, 204
+Gas expense, 213, 233, 239 (See also generally "Fixed charges,"
+"Light and heat")
+"General expense account," illus-
+trated,
+general ledger (See "Ledger")
+General ledger (See "Ledger")
+Goods in warehouse (See "Warehouse")
+Goods in process (See "Work in Process")
+Graduated premium system of wage payment, 206
+Graphic charts (See "Charts")
+
+Hat factory, 55
+Form I
+Holding expenses, stores, 130
+Heat and light (See "Light and heat")
+Ice factory, cost system, 12
+Idle time, machines, 295
+Illustrations (See "Cost accounting")
+Indirect expense (See "Expense", in-
+ternal)
+Indirect labor (See "Labor", indi-
+rect)
+Indirect material (See "Supplies")
+Insurance expense, 226
+Insurance accident, 238
+Insurance expense, 98, 100, 213, 217,
+238 (See also generally "Fixed charges")
+account, illustrated, 102
+journal entry; illustrated, 107
+textile costs,
+boiler,
+fire,
+production-center system,
+Interest on investment, 240 (See also generally "Fixed charges")
+
+<table>
+<thead>
+<tr>
+<td>Index</td>
+<td>Page Number</td>
+</tr>
+</thead>
+<tbody>
+<tr>
+<td>Fixed charges—Continued</td>
+<td>433</td>
+</tr>
+<tr>
+<td>insurance—Continued</td>
+<td></td>
+</tr>
+<tr>
+<td>journal entry,</td>
+<td>illustrated,</td>
+</tr>
+<tr>
+<td>production-center system,</td>
+<td>290</td>
+</tr>
+<tr>
+<td>textile costs,</td>
+<td>account illustrated,</td>
+</tr>
+<tr>
+<td>107</td>
+<td></td>
+</tr>
+<tr>
+<td>interest on investment,</td>
+<td>240</td>
+</tr>
+<tr>
+<td>light and heat,</td>
+<td>265,</td>
+<tr>
+<td>304 (See also subheadings below,</td><td>"Electricity"</td>
+</tr>
+<tr>
+<td>rent,</td><td>98,</td><td>100,</td><td>235,</td><td>236</td>
+</tr>
+<tr>
+<td>account,</td><td>illustrated,</td><td>101</td>
+</tr>
+<tr>
+<td>journal entry,</td><td>illustrated,</td><td>101</td>
+</tr>
+<tr>
+<td>production-center system,</td><td>290</td>
+</tr>
+<tr>
+<td>schedule,</td><td>294,</td><td>293,</td><td>293</td>
+</tr>
+<tr>
+<td>Form I</td><td></td><td></td><td></td><td></td>
+</tr>
+<tr>
+<td>process system,</td><td>341</td><td></td><td></td><td></td>
+</tr>
+<tr>
+<td>Form,</td><td>,<br/>342<br/></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br></br/></table>
+
+<table border="1">
+<thead>
+<tr style="background-color: #f0f0f0;">
+<th>Description</th>
+<th>Pages</th>
+<th>Description</th>
+<th>Pages</th>
+<th>Description</th>
+<th>Pages</th>
+<th>Description</th>
+<th>Pages</th>
+<th>Description</th>
+<th>Pages</th>
+<th>Description</th>
+<th>Pages</th>
+<th>Description</th>
+<th>Pages</th>
+<th>Description</th>
+<th>Pages</th>
+<th>Description</th>
+<th>Pages</th>
+<th>Description</th>
+<th>Pages</th>
+<th>Description</th>
+<th>Pages</th>
+<th>Description</th>
+<th>Pages</th><th>Description</th><th>Pages</th><th>Description</th><th>Pages</th><th>Description</th><th>Pages</th><th>Description</th><th>Pages</th><th>Description</th><th>Pages</th><th>Description</th><th>Pages</th><th>Description</th><th>Pages</th><th>Description</th><th>Pages</th><th>Description</th><th>Pages</th><th>Description</th><th>Pages</th><th>Description</th><th>Pages</th><th>Description</th><th>Pages</than td style="border: none;">
+ <table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+ <style>.header { font-weight: bold; }
+ </style><span class="header">Index:</span>
+ <style>.header { font-weight: bold; }
+ </style>&#x{index} – &#x{page_number} – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –
+ <style>.header { font-weight: bold; }
+ </style>&#x{index} - &#x{page_number} - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
+ <style>.header { font-weight: bold; }
+ </style>&#x{index} -- &#x{page_number} -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
+ <style>.header { font-weight: bold; }
+ </style>&#x{index} --- &#x{page_number} --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
+ <style>.header { font-weight: bold; }
+ </style>&#x{index} ---- &#x{page_number} ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- 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+ <style>.header { font-weight: bold; }
+ </style>&#x{index} ----- &#x{page_number} ----- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
+ <style>.header { font-weight: bold; }
+ </style>&#x{index} ----- &#x{page_number} ----- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- -------
+ <style>.header { font-weight: bold; }
+ </style>&#x{index} ----- &#x{page_number} ----- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- ------------------------ -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
+ <style>.header { font-weight: bold; }
+ </style>&#x{index} ----- &#x{page_number} ----- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- --------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ----------------------------------------------------
+ <style>.header { font-weight: bold; }
+ </style>&#x{index} ----- &#x{page_number} ----- 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+ <style>.header { font-weight: bold; }
+ </style>&#x{index} ----- &#x{page_number} ----- ---------------------------------------------------------------------------
+ <style>.header { font-weight: bold; }
+ </style>&#x{index} ----- &#x{page_number} ----- ---------------------------------------------------------------------------
+ <style>.header { font-weight: bold; }
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+ <style>.header { font-weight: bold; }
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+ <style>.header { font-weight: bold; }
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+ <style>.header { font-weight: bold; }
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+ <style>.header { font-weight: bold; }
+ </style>&#x{index} ----- &#x{page_number} ----- ---------------------------------------------------------------------------
+ <style>.header { font-weight: bold; }
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+ <style>.header { font-weight: bold; }
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+
+<page_number>434</page_number>
+INDEX
+
+Inventory, controlling accounts, 79
+finished goods, 75, 76
+perpetual,
+advantages, 10,
+cost accounting maintains, 5, 9
+necessity for, 75
+raw material, 76
+sheet, 121
+Form, 120
+stores, 118
+physical, 10, 121
+sheet, 121
+Form, 120
+work in process, 74
+Investment, interest on, 240
+Invoicees, classification of, indirect expense, 217
+subsidiary ledger, 218
+Form, 218
+
+J
+Jewelry manufacturing concern, 350
+Job cost sheets (See "Cost Sheets")
+Job order system, 15, 41, 107
+(See also "Cost accounting")
+Journal entries,
+controlling accounts, illustrated, 106-108
+production-center system, 311,
+314-316
+purchases, 122, 130
+expense, indirects, 213, 217, 224
+posting to general ledger, 30
+process cost system, 339
+
+L
+Labor, 165-205,
+account, illustrated, 65
+estimated cost system, 359
+Journal entry, Illustrated, 107
+account, process cost system, 80
+classification, 167, 168
+
+cost period different from pay period, 172
+direct, 18
+chart, graphic, 497-447
+Form(s), 498, 415, 436, 438
+indirect (See "Labor," indirect below)
+methods of distributing expense over per product used on, 275-289 pay-roll (See "Pay-roll")
+piece-work basis, 168-171 production center system, 306 records, 165-166 accuracy essential, 165 process cost system, 166 purpose of control system time basis, 169 process cost system, 347 time record (See "Time records")
+wage systems,, 169 (See also "Wage systems")
+Labor, indirect,, 18, 160,, 168,, 219,
+classification of labor costs accounts,, 221 administrative (See "Administrative accounts")
+chart of accounts graphic,, 191 Form(s), 193 classification,, 251 time tickets,, 227 Form(s), 227
+
+M
+Ledger (See also "Accounts") controlling accounts (See "Controlling accounts")
+
+<img>A page from an index or table of contents.</img>
+
+INDEX
+<page_number>435</page_number>
+
+Ledger—Continued
+chart of procedure, 308
+Form, 303
+expense, 218, 266, 267
+cost sheet, 306
+Form, 303
+factory cost, 76 (See also "Cost sheets")
+controlled by general ledger, 74
+estimated costs, 308
+process cost system, 90, 328,
+343-348
+Forms, 345, 346, 348
+general,
+"account," 360
+relation between cost accounts
+and, 4, 75
+plant, 229
+stock (finished goods), 77
+storage,
+stores, 57-58, 81, 119, 126, 218
+Form, 78, 128, 129
+control of, 130
+discrepancies, 139
+posting from stores received books, 126, 130
+process cost system, 88
+Letter code of classification, 155,
+159
+shipping expense credits, 267
+Light and heat, 225, 304 (See also "Electricity"), "Gas", also gen-
+erally "Fixed charges") accountants' office,
+production-center system, 220
+textile costs, 304
+Lumber industry, charges applied to raw material, 130
+
+M
+
+Machine-rate method of distribu-
+tion (See also "product", 272,
+277-279, 287-288, 301-327)
+accounts, 310-327
+chart, 310
+Form, 312, 313
+Illustrated(), 319-326
+
+chart of procedure, 308
+Form, 303
+cost sheet, 306
+Form, 303
+departmental division into pro-
+duction centers, 98, 275, 287,
+illustrative systems, 301-327
+journal entries, 311, 314
+Illustrated(), 314-318
+Labor costs,
+machine expense account, 296
+material cost, 306, 309
+particulars account, 305
+production orders, 305
+rates,
+administrative expense, 291
+building expenses, 290
+charging., 293
+checking., 294
+compensation., 288-295
+depreciation charge., 290
+insurance charge., 290
+plant capital expense., 290,
+290 rent., 298
+repairs expenses., 291
+schedule of supplementary., for idle time.,
+supplementary., for idle time.,
+supplies., etc. expense., 291
+taxes charge., charge.,
+tools expense., charge.,
+statement of expenses., charge.,
+taxes charge., charge.,
+stock list., Form.
+Stocks and materials inventory,
+Materials inventory., Form.
+"Machine-rate method of dis-
+tributing expense" (See also "product",
+"accountants' office", "production-center system",
+"raw material", "labor costs",
+"inventory", "taxes")
+expenses account., charge.,
+illustrated., charge.,
+insurance., charge.,
+power expense distribution.,
+taxes., charge.
+
+<img>A page from a book or report with text and some illustrations.</img>
+
+# 486 INDEX
+
+**Maintenance of buildings (See "Building expense")**
+
+Manufacturing accounting (See "Work in process account")
+
+Manufacturing cost and profit and loss statement, 109
+
+Material, 17, 115-102 (See also "Stores" and "Supplies")
+account, 75, 81, 238 entries, 81 estimated cost system, illustrated, 83 journal entries, illustrated, 106 production-cost system, illustrated, 324 textile costs, 367, 368 bill of, 135 Form, 135 costs, estimated, 63 process method, 86 estimated cost, 63-65, 149 (See also "Estimated cost system") included in term "stores," 23 indirect, in "Stores" and "Supplies" inventory or record, 70 parts classification, 905 record on stores ledger, 130, 306 proof of, 132 records, 76 (See also "Stores") requisitions, 25, 58, 133 Form, 58 N analysis, 228 classification, 131, 136 parts, 67 posting to general ledger, 131-136 process cost system, 194 production-center system, 506 purposes of, 134 record on stores ledger, 127, 306 summarized in stores issue books, 131 supplies on distribution sheet, 224, 253 when impracticable to use,
+sheet, 148 Form, 135 stock list, 135-304 Form, 135-304 stores departments expense ap-
+plied to cost $298, $297, $292 Material cost method of distribut-
+ing expense over product, 272,
+297 Mechanical time card, 167, 168,
+176 Form, 181 Merchandising business costs, 24 Merchandise service. See also
+general subject of "Labor," in-
+direct"
+Methods of cost accounting (See
+"Cost accounting")
+Methods of distributing expense over product (See "Expense in-
+come" distribution over prod-
+uct")
+Mining. See Mining
+(See also "Stocks")
+Monemonic system of stores classifi-
+cation. See classification
+Monthly reports of production. See
+production
+Form. See form
+
+N "Needle" industries estimating
+costs in $6 Non-productive departments (See
+also "Non-operational expenses")
+"Building expense." See Power
+plant expense.
+Departments departmental accounts. See
+accounts. See accounts.
+Distribution of indirect expense,
+99, 103, 104; $27-$270
+Sub-departments expense. See sub-
+departments expense. See sub-departments expense.
+
+<table>
+<thead>
+<tr>
+<td>Topic</td>
+<td>Description</td>
+</tr>
+</thead>
+<tbody>
+<tr>
+<td>Maintenance of buildings</td>
+<td>(See "Building expense")</td>
+</tr>
+<tr>
+<td>Manufacturing accounting</td>
+<td>(See "Work in process account")</td>
+</tr>
+<tr>
+<td>Manufacturing cost and profit and loss statement</td>
+<td>statement,</td>
+</tr>
+<tr>
+<td>Material,</td>
+<td>Material.</td>
+</tr>
+<tr>
+<td>account,</td>
+<td>account.</td>
+</tr>
+<tr>
+<td>entry,</td>
+<td>entry.</td>
+</tr>
+<tr>
+<td>estimated cost system,</td>
+<td>estimated cost system.</td>
+</tr>
+<tr>
+<td>illustrated,</td>
+<td>illustrated.</td>
+</tr>
+<tr>
+<td>journals,</td>
+<td>journals.</td>
+</tr>
+<tr>
+<td>entry,</td>
+<td>entry.</td>
+</tr>
+<tr>
+<td>illustrated,</td>
+<td>illustrated.</td>
+</tr>
+<tr>
+<td>production-cost system,</td>
+<td>production-cost system.</td>
+</tr>
+<tr>
+<td>illustrated,</td>
+<td>illustrated.</td>
+</tr>
+<tr>
+<td>textile costs,</td>
+<td>textile costs.</td>
+</tr>
+<tr>
+<td>bill of,</td>
+<td>bill of.</td>
+</tr>
+<tr>
+<td>form,</td>
+<td>form.</td>
+</tr>
+<tr>
+<td>costs,</td>
+<td>costs.</td>
+</tr>
+<tr>
+<td>estimated cost,</td>
+<td>estimated cost.</td>
+</tr>
+<tr>
+<td>method,</td>
+<td>method.</td>
+</tr>
+<tr>
+<td>system,</td>
+<td>system.</td>
+</tr>
+<tr>
+<td>included in term "stores,"</td>
+<td>included in term "stores."</td>
+</tr><table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<table>
+
+<!-- Table -->
+```html
+<style type="text/css">
+ table {
+ border-collapse: collapse;
+ width: auto;
+ }
+ th {
+ border-bottom: solid black thin;
+ padding: .5em;
+ }
+ td {
+ border-top: solid black thin;
+ padding: .5em;
+ }
+ tr.header {
+ background-color: #f0f0f0;
+ border-top: solid black thick;
+ border-bottom: solid black thick;
+ padding: .5em;
+ }
+ tr.footnote {
+ background-color: #f0f0f0;
+ border-top: solid black thick;
+ border-bottom: solid black thick;
+ padding: .5em;
+ }
+ tr.footnote td {
+ border-top: none;
+ border-bottom: none;
+ padding: .5em;
+ }
+ tr.footnote p {
+ margin-left: .5em;
+ }
+ tr.footnote p:last-child {
+ margin-right: .5em;
+ }
+```
+```html
+<style type="text/css">
+ table {
+ border-collapse: collapse;
+ width: auto;
+ }
+ th {
+ border-bottom: solid black thin;
+ padding: .5em;
+ }
+ td {
+ border-top: solid black thin;
+ padding: .5em;
+ }
+ tr.header {
+ background-color: #f0f0f0;
+ border-top: solid black thick;
+ border-bottom: solid black thick;
+ padding: .5em;
+ }
+ tr.footnote {
+ background-color: #f0f0f0;
+ border-top: solid black thick;
+ border-bottom: solid black thick;
+ padding: .5em;
+ }
+ tr.footnote td {
+ border-top: none;
+ border-bottom: none;
+ padding: .5em;
+ }
+ tr.footnote p {
+ margin-left: .5em;
+ }
+ tr.footnote p:last-child {
+ margin-right: .5em;
+ }
+```
+```html
+<style type="text/css">
+ table {
+ border-collapse: collapse;
+ width: auto;
+ }
+ th {
+ border-bottom: solid black thin;
+ padding: .5em;
+ }
+ td {
+ border-top: solid black thin;
+ padding: .5em;
+ }
+ tr.header {
+ background-color: #f0f0f0;
+ border-top: solid black thick;
+ border-bottom: solid black thick;
+ padding: .5em;
+ }
+ tr.footnote {
+ background-color: #f0f0f0;
+ border-top: solid black thick;
+ border-bottom: solid black thick;
+ padding: .5em;
+ }
+ tr.footnote td {
+ border-top: none;
+ border-bottom: none;
+ padding: .5em;
+ }
+ tr.footnote p {
+ margin-left: .5em;
+ }
+ tr.footnote p:last-child {
+ margin-right: .5em;
+ }
+```
+```html
+<style type="text/css">
+table {
+border-collapse: collapse;
+width:auto;
+}
+th {
+border-bottom:solid black thin;
+padding:.5em;
+}
+tbody {
+border-top:solid black thin;
+padding:.5em;
+}
+tfoot {
+border-top:solid black thick;
+padding:.5em;
+}
+tfoot td {
+border-top:none;
+border-bottom:solid black thick;
+padding:.5em;
+}
+tfoot p {
+margin-left:.5em;
+}
+tfoot p:last-child {
+margin-right:.5em;
+}
+```
+```html
+<style type="text/css">
+table {
+border-collapse: collapse;
+width:auto;
+}
+th {
+border-bottom:solid black thin;
+padding:.5em;
+}
+tbody {
+border-top:solid black thin;
+padding:.5em;
+}
+tfoot {
+border-top:solid black thick;
+padding:.5em;
+}
+tfoot td {
+border-top:none;
+border-bottom:solid black thick;
+padding:.5em;
+}
+tfoot p {
+margin-left:.5em;
+}
+tfoot p:last-child {
+margin-right:.5em;
+}
+```
+```html
+<style type="text/css">
+table {
+border-collapse: collapse; width:auto; } th {border-bottom:solid black thin;padding:.5em;} tbody {border-top:solid black thin;padding:.5em;} tfoot {border-top:solid black thick;padding:.5em;} tfoot td {border-top:none;border-bottom:solid black thick;padding:.5em;} tfoot p {margin-left:.5em;} tfoot p:last-child {margin-right:.5em;} </style><table><thead><tr><th colspan="2">INDEX</th></tr></thead><tbody><tr><th>Maintenance of buildings (See "Building expense")<br>Maintaining buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (See "Building expense")<br>Maintenance of buildings (see)
+
+INDEX 497
+
+Non-productive departments—Cost.
+expense, indirect, 312
+chart, 312
+Form, 316
+Non-productive labor (See "Labor," indirect") 350
+Non-manufacturing concern, 350
+Number, order, 33
+Numerical classification system, 155
+standing expense orders, 229-232
+list, 227, 229
+Form, 230
+
+O
+
+Qholescence, 245
+Office expense (See also "Administrative expense")
+account illustrated, textile costs, 367
+Operating departments (See also "Productive departments")
+individual cost classification centers, 278, 281, 301
+Order method of cost-finding, 131
+41, 47-92 (See also "Cost accounting")
+entries in controlling accounts, 81-86, 85, 96
+Orders,
+production, 29, 50, 55, 305
+Form, 32, 51, 57
+authorization of, 32
+Form, 340
+combination, 55
+Form, 57
+cost sheets (See "Cost sheets")
+company, 57
+Form, 59, 60
+numbering, 33
+parts pre-numbered items, 37
+process coat system, 138
+Form, 137
+
+sources of, 81
+summary of orders issued, 138
+replenishment, 146
+standing expense (See "Standing expense orders") overhead (See "Expense," indirect") Overhead (See "Expense," indirect") Overvoltage, effect on expense distribution rates, 268
+
+P
+
+Paper mill, 43, 50
+Parts,
+account illustrated, production-center systems, 324
+classification codes, 305
+accounting terms definitions, 24 when "stores" and when "stock,"
+24
+
+Part product,
+66
+Patterns cost., 62, 261 Pay-roll,
+167, 168, 172, 187-193, 339 (See also "Labor," indirect") Form(s), Form(s) Form(s), Form(s)
+Form(s), Form(s), Form(s), Form(s)
+
+process cost system, 89 account illustrated, 89-107 journal illustrated stratified. IOM production-center systems. B23 textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs. textile costs.
+
+charts graphic.
+190 Form(s), Form(s), Form(s), Form(s)
+Form(s), Form(s), Form(s), Form(s)
+period different from pay period,
+172 period coinciding with cost period,
+23 process cost system,
+88-93 Form(s), Form(s)
+sources of data,
+36 Pay system (See "Wage systems")
+
+<img>A page from an index or table of contents.</img>
+
+<table>
+ <tr>
+ <td><strong>488</strong></td>
+ <td><strong>INDEX</strong></td>
+ </tr>
+ <tr>
+ <td colspan="2">Percentage of labor method of dis-</td>
+ </tr>
+ <tr>
+ <td colspan="2">tributing expense over product,</td>
+ </tr>
+ <tr>
+ <td colspan="2">275-276</td>
+ </tr>
+ <tr>
+ <td>Period, cost (See "Cost period")</td>
+ <td>Perpetual inventory (See "Inven-</td>
+ </tr>
+ <tr>
+ <td colspan="2">tory")</td>
+ </tr>
+ <tr>
+ <td>Physical inventory of stores, 121</td>
+ <td>Daily time sheet, 182</td>
+ </tr>
+ <tr>
+ <td>Piece-rate method of wage payment,</td>
+ <td>Form, 183</td>
+ </tr>
+ <tr>
+ <td>differential piece-rate method, 200</td>
+ <td>production order, 33</td>
+ </tr>
+ <tr>
+ <td>straight method, 197-200</td>
+ <td>Process cost system, 12, 43-45, 86-</td>
+ </tr>
+ <tr>
+ <td>Fixing rate, 197-200</td>
+ <td>95, 328-348</td>
+ </tr>
+ <tr>
+ <td>Piece-work, 169-171</td>
+ <td>account classification, 328</td>
+ </tr>
+ <tr>
+ <td>chart, graphic, 191</td>
+ <td>accounts, 371</td>
+ </tr>
+ <tr>
+ <td>Form, 192</td>
+ <td>brick-making plant, 45, 50, 87,</td>
+ </tr>
+ <tr>
+ <td>pay-roll, 329</td>
+ <td>328-349</td>
+ </tr>
+ <tr>
+ <td>Form, 188</td>
+ <td>account codes, 328, 345-347</td>
+ </tr>
+ <tr>
+ <td>time card, 184</td>
+ <td>Forms, 344, 346</td>
+ </tr>
+ <tr>
+ <td>Form, 186</td>
+ <td>administrative expense account,</td>
+ </tr>
+ <tr>
+ <td>comps, Form, Form,</td>
+ <td>364</td>
+ </tr>
+ <tr>
+ <td>Plant,</td>
+ <td>Form, Form,</td>
+ </tr>
+ <tr>
+ <td>aants., 213, 217, 222</td>
+ <td>brick production record, daily,</td>
+ </tr>
+ <tr>
+ <td>building expense (See "Building</td>
+ <td>Form,</td>
+ </tr>
+ <tr>
+ <td>expense")</td>
+ <td>broken brick record, daily,</td>
+ </tr>
+ <tr>
+ <td>Power expense,</td>
+ <td>Form,</td>
+ </tr>
+ <tr>
+ <td>account, illustrated,</td>
+ <td>broken brick record, monthly,</td>
+ </tr>
+ <tr>
+ <td>taxable income", Form,</table>
+
+<table>
+
+<tr>
+
+<td><strong>Power plant expense account, Form:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr>
+
+<td><strong>Power plant expense account:</strong></table>
+
+<tr
+
+```json
+[
+ {"line_item": "Percentage of labor method of distributing expenses over product"},
+ {"line_item": "Periods (See \"Cost period\")"},
+ {"line_item": "Perpetual inventory (See \"Inventory\")"},
+ {"line_item": "Physical inventory of stores"},
+ {"line_item": "Piece-rate method of wage payment"},
+ {"line_item": "Differential piece-rate method"},
+ {"line_item": "Straight method"},
+ {"line_item": "Fixing rate"},
+ {"line_item": "Piece-work"},
+ {"line_item": "Chart"},
+ {"line_item": "Graphic"},
+ {"line_item": "Form"},
+ {"line_item": "Pay-Roll"},
+ {"line_item": "Time card"},
+ {"line_item": "Form"},
+ {"line_item": "Comps"},
+ {"line_item": "Plant"},
+ {"line_item": "Aunts."},
+ {"line_item": "Building Expense (See \"Building Expense\")"},
+ {"line_item": "Power Expense"},
+ {"line_item": "Account Illustrated"},
+ {"line_item": "Taxable Income"},
+ {"line_item": "Power Plant Expense Account"},
+ {"line_item": "Form"}
+]
+```
+
+INDEX 489
+
+Process cost system—Continued
+brick-making plant—Continued
+setting report, 332
+Ferris, 170
+time ticket, 179, 331
+Form, 45
+current period, 87
+classification of stores, 131
+closing controlling accounts, 80,
+106 combined with order system, 48
+compared with order system, 95
+cost center, 90
+defined, 41
+distribution of costs direct to product, 92
+distribution of expense, over product, 271
+distribution of manufacturing cost entries in controlling accounts, 86-96
+costs, indirect, accounts, 89, 106-108, 269, 344
+distribution, 89, 271
+distribution direct to product, 41
+flour mill, 87
+journal entries, illustrated, 106-
+108
+labor, 88, 94, 105
+account, illustrated, 95
+monthly time basis of payment, 167
+material cost, 86
+material requisitions, 134
+payment, 167
+Form, 340
+account, 89
+analysis charts, 179
+production reports, 43
+Form, 45
+purchase journal, 329
+stores classification, 131
+
+stores ledger, 88
+supplies account, 88
+textile costs, 363 (See also "Tex-
+tile costs")
+textile costs, illustrated, 363
+work in process account, 89
+closing dates illustrated, 90
+
+Product.
+Production of expense over, 98,
+225, 275-276 (See also un-
+der "Expense", indirect")
+Production method of distribu-
+ting expense (See "Machine-
+rate method")
+Production chart graphic, 415
+
+Production orders (See "Orders")
+Production reports, 44, 328-329
+Forms, 45, 353-355, 337-338
+
+summarized daily,
+chilly,
+Form,
+monthly,
+Form,
+Form,
+weekly,
+Form,
+
+Productive departments.
+Indirect expense, 212
+chart of accounts.
+
+Form. 214. 215 distribution over departments,
+90. Indirect expenses also "Ex-
+pense", indirect ("distribution").
+Indirect expense account,
+illustrated,
+Form.
+Journal entry diary. Illustrated. 107 productive-center sub - depart-
+ments.
+forms. 275. 267
+
+Productive method of distribu-
+ting expense over product,
+272. 275-277
+
+Profit standard account. 100 Profit or loss shown by cost ac-
+counting. 4
+
+<table>
+<thead>
+<tr>
+<td>INDEX</td>
+<td>489</td>
+</tr>
+</thead>
+<tbody>
+<tr>
+<td>Process cost system—Continued</td>
+<td></td>
+</tr>
+<tr>
+<td>brick-making plant—Continued</td>
+<td></td>
+</tr>
+<tr>
+<td>setting report</td>
+<td>332</td>
+</tr>
+<tr>
+<td>Ferris</td>
+<td>170</td>
+</tr>
+<tr>
+<td>time ticket</td>
+<td>179</td>
+</tr>
+<tr>
+<td>Form</td>
+<td>45</td>
+</tr>
+<tr>
+<td>current period</td>
+<td>87</td>
+</tr>
+<tr>
+<td>classification of stores</td>
+<td>131</td>
+</tr>
+<tr>
+<td>closing controlling accounts</td>
+<td>80,</td>
+</tr>
+<tr>
+<td>combined with order system</td>
+<td>48</td>
+</tr>
+<tr>
+<td>compared with order system</td>
+<td>95</td>
+</tr>
+<tr>
+<td>cost center defined</td>
+<td>41</td>
+</tr>
+<tr>
+<td>distribution of costs direct to product</td>
+<td>92</td>
+</tr>
+<tr>
+<td>distribution of expense over product</td>
+<td>271</td>
+</tr>
+<tr>
+<td>distribution of manufacturing cost entries in controlling accounts</td>
+<td>86-96</td>
+</tr>
+<tr>
+<td>costs indirect accounts</td>
+<td>89,</td>
+</tr>
+<tr>
+<td>106-108,</td>
+<td>269,</td><td>344</td><td>distribution.</td><td>89,</td><td>271</td><td>distribution direct to product.</td><td>41</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></ td><br/>
+<td>floor mill.</table>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f0;">
+<th>Description of Account Type and Purpose (continued)</th>
+
+<table border="1">
+<thead style="background-color: #f0f0f0;">
+<tr style="background-color: #f0f0f...
+
+<table>
+ <tr>
+ <td><page_number>440</page_number></td>
+ <td>INDEX</td>
+ </tr>
+</table>
+
+Profits of different lines, cost accounting indicators, 8, Purchases journal, 81, 120, 136 expenses, indirect, 213, 217, 224, 235 posting to general ledger, 130 process system, 350 Purchases order, 124 Purchasing department, 116, 124
+
+R Rates, depreciation, 247 Rates of expense distribution over product, 422, 312-275 adjustment of material and applied expense, 212, 392-285 flat percentage charge, 284 reserve account, 285 machine-rates method, 272, 277, 279, 287-95, 301-327 (See also "Machine-rates") material cost method, 272, 281 percentage of labor method, 272- 275 prime cost method, 273, 281 process system, 271 productive-hour method, 272, 275- 277 sold-hour method, 273, 279 Ratio charts, 406, 410-418 Forms, 415-418 Item material (See "Material") Records, 399 cost, 399 cost sheets, 90, 38, 76 (See also "Cost ledger") Forms, 39, 37 material ordered on, 131 production-center system, 300 Form, 309 record of orders issued, 138 requisitions posted to, 306 expense indirect, 224 (See also individual bradings throughout)
+
+inventory short, 121 Form, 120 form. I65-169 (See also "Labor") process cost system (See "Process cost system") reports (See "Reports") time (See "Time records") Register. voucher (See "Purchase register") Rent. $80. $00. $00. $00 (See also generally "Fixed charges") production-center system. $89 time expense account. Illustrated. $00 Journal entry. Illustrated. $00 Entry printed. Illustrated. $00 Repairs. $00 machinery. $00 (See also general subject of "Labor", indirect) production-center system. $00 standing expense orders. $00 Replacements in stock. $00 Reports (See also "Slatent costs") material used. $46 production-costs (See "Production re- ports") time (See "Time records") Requisition forms (See "Material requisi- tions") Reserve for expense account. $89 Return of material to vendor. $00 Rope making. $00
+
+$ Salaries (See "Labor", "Pay-roll") Schedule (See also "Analysis") depreciation rates. $39. $46. $39 textile costs. $67. $68
+
+INDEX
+
+<page_number>441</page_number>
+
+Schedule--Continued
+fixed charges, 224, 233, 235
+Form, 235
+process system, 341
+Ferry, 236
+Scheduling work in department(s), for even capacity, 62
+Scrutiny, 237
+Selling price,
+cost accounting fixes, 5, 6
+editions, 25
+Form, 25
+Service departments (See "Admin-
+istrative expense"), "power plant
+expenses," "Shared department
+expense"
+Stocks,
+cost (See "Cost sheets")
+expansion distribution (See "Ex-
+pense, indirect, distribution
+sheets")
+Shipping department, account illus-
+trated, textile costs, 383
+Shipping expense,
+chart of accounts, 417
+Form, 418
+Shop factory,
+direct labor sheet, 62
+estimated cost of material, 140
+estimated costs in, 63
+stock, 63
+Form, 55, 60
+Soap factory, by-products, 148
+Salesperson method of distributing
+expenses, 275, 276, 279
+Spinning mill, 46 (See also "Textile
+costs")
+waybill production report, 44, 45
+Form, 45
+Spoilage of material, 146
+Stationary expense orders: 31, 224,
+226-228
+classification, 227, 229-230
+distribution, 224
+sub-departments, 236
+
+numbering, 229
+list of, 227, 229
+Form, 230
+time tickets, 227
+Form, 230
+
+Statements,
+expenses, production-center sys-
+tem(s), 80,
+Form, 307
+manufacturing and profit and loss,
+monthly, 31
+pay-rolls, 190
+statistical, 405, 414
+Standard cost charts (See "Chart,"
+graphic)
+Steel industry, charges applied to raw material,
+Stock. See (See also "Material,"
+"Stores")
+ledger (for raw goods), 77
+Form. See Form.
+list. See list.
+Trends. See Trends.
+Stores (See also "Material," "Sup-
+plies")
+accountants,
+journal entries, illustrated, 106
+accounting. See Material,
+adjustments. See Material,
+arrangement. See Material,
+bill of material. See Material,
+bin log. See bin log.
+Form. See Form.
+hyphenation. See Hyphenation.
+charges applied to raw material,
+classification. See Classification.
+advantages. See Advantages.
+basis for system used. See System.
+"block" system. See System.
+catalogue. See Catalogue.
+
+<table>
+<thead>
+<tr>
+<td>Schedule--Continued</td>
+<td>Form</td>
+<td>Statement(s)</td>
+</tr>
+</thead>
+<tbody>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td>
+<td>Statements,</td>
+</tr>
+<tr>
+<td>fixed charges,</td>
+<td>fixed charges,</td><table
+
+<table>
+ <tr>
+ <td><page_number>448</page_number></td>
+ <td>INDEX</td>
+ </tr>
+ <tr>
+ <td colspan="2">Stores—Continued<br>classification—Continued<br>combination of letters and<br>numbers, 155, 160<br>Dewey decimal system, 156<br>letter system, 157, 158<br>mnemonic system, 159<br>numerical system, 155<br>symbols used, 154<br>control of stores, 81, 122<br>defective work, 146<br>definition, 23, 116<br>department arrangement, 117<br>department expense, 98, 102 (See also generally "Non-productive expenditures")<br>account, 217<br>account illustrated, production-cost center system, 321<br>napped direct to material, 268,<br>297, 302<br>on distribution sheet, 269, 264<br>sub-departmentalized, 300<br>estimated quantity, 140<br>expense, incurred before receipt, 130<br>finished parts, 25, 67, 86<br>fuctuations in weight or volume, 144<br>inventory, 118<br>perpetual, 9, 10<br>physical, 321<br>sleevi, 321<br>Forn., 120<br>issued, check on, 131-133<br>issued books, 131, 136<br>Forn., 137<br>control of, 137<br>posting to general ledger, 136<br>requisitions summarized in, 131,<br>136<br>kerevi, 118<br>Ledger, 76-78, 81, 119, 126, 218<br>Forn., 78, 128, 129</td>
+ <td>control of, 130<br>diameter control, 130<br>pouching from stores received book, 125, 130 process cost system, 88 price list control of stores estimated, shoe factory, 149 fluctuations in, 142 purchase order, 194 purchasing department, 116, 124 receiving order form. T9A</td>
+ <tr>
+ <td colspan="2">Form. T95 agreement with purchase jour-nal. T9B posting to stores ledger. T9B</td>
+ <td>T9C record of abstracts. T9C records. T95, T98-T99 requisitions (See "Material requisitions") returnable stock scrap. T94 shrinkage adjustment on books. T94 spoiling. T95 supplies (See "Supplies") used. report of. T94 waste. T94-T95 adjustment on books. T94 before use of stores. T95 Sub-departments non-productive (machine groups), T95-T96 non-productive (See "Machine rate method of distributing ex-penses over periods") Subsidiary ledgers (See "Ledger") Summary cost ledger process cost sys-tem Form. T98 daily work sheet. T92</td>
+ </tr>
+</table>
+
+INDEX
+
+Summary—Continued
+production, daily, 371
+Form, 387
+monthly, 386
+Form, 387
+weekly, 384
+Form, 45
+time tickets, 171, 173, 177
+Simmons, 200
+stock, 291, 292
+Supplies, 71, 213, 211, 221, 225-232
+account, 81, 122
+journal entries, illustrated, 106 process of transactions, 88 charged direct, unusual method, 292 included in term "stores," 293 posting from stores issued book, 138 production-center system, 291 account, illustrated, 325 requisitions, 224 on distribution sheet, 254, 255 standing expense orders, 254, 226- 232 Form, 290 System cost (See "Cost accounting")
+Task system of wage payment, 204 Taxes expenses, 98, 103, 213, 233, 238 (See also generally "Fixed charges") account, illustrated textile costs, 396 journal entry, illustrated, 107 production-cost accounts, 399 Telephone expense, 213, 231 (See also generally "Fixed charges") Textile analysis sheets, 91, 355-401 analysis sheets,
+cost of cloth knit, 387, 388 cost of cloth woven, 381, 384.
+385 cost of mixes, 372, 373 cost of yarn carded and spun,
+378, 379 finished cloth, 387, 390 conversion cost distributed over yarn cost, depreciation schedules,
+387, 398 dying and finishing,
+accounting schedule,
+367-369 expense accounts indirect,
+367-369 building supplies,
+366 building expenses,
+365 "general expenses,"
+insurance,
+50-55 heat and power,
+expense office,
+costs,
+taxes,
+finished goods account,
+fluctuations weight and volume of material,
+144 knitting machine costs,
+department costs,
+accounting costs,
+operating departmental costs,
+payroll taxes,
+raw material account,
+shipping expense account,
+spinning costs,
+production report,
+weekly,
+44-45 Form,
+45 wages account,
+wages received,
+wages processed,
+work in process accounts,
+dye house,
+dye house,
+katting costs,
+mixes,
+sewing costs,
+weaving costs.
+Time basis of wage payment,
+clocks,
+"on and out,"
+<page_number>443</page_number>
+<page_number>444</page_number>
+<page_number>445</page_number>
+<page_number>446</page_number>
+<page_number>447</page_number>
+<page_number>448</page_number>
+<page_number>449</page_number>
+<page_number>450</page_number>
+<page_number>451</page_number>
+<page_number>452</page_number>
+<page_number>453</page_number>
+<page_number>454</page_number>
+<page_number>455</page_number>
+<page_number>456</page_number>
+<page_number>457</page_number>
+<page_number>458</page_number>
+<page_number>459</page_number>
+<page_number>460</page_number>
+<page_number>461</page_number>
+<page_number>462</page_number>
+<page_number>463</page_number>
+<page_number>464</page_number>
+<page_number>465</page_number>
+<page_number>466</page_number>
+<page_number>467</page_number>
+<page_number>468</page_number>
+<page_number>469</page_number>
+<page_number>470</page_number>
+<page_number>471</page_number>
+<page_number>472</page_number>
+<page_number>473</page_number>
+<page_number>474</page_number>
+<page_number>475</page_number>
+<page_number>476</page_number>
+<page_number>477</page_number>
+<page_number>478</page_number>
+<page_number>479</page_number>
+<page_number>480</page_number>
+<page_number>481</page_number>
+<page_number>482</page_number>
+<page_number>483</page_number>
+<page_number>484</pages>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.</img>
+
+<img>A page from a book or document with text and numbers.
+
+# INDEX
+
+<table>
+ <tr>
+ <td>Time records, daily time sheet, 175, 182<br>Forma, 176, 180<br>payroll, 167, 168, 172, 187-193, 339<br>Forms, 188-190, 340<br>analytical system, 220<br>charts, graphic, 190<br>Forma, 192, 193<br>cost period different from pay period, 187<br>non-productive labor, 187<br>process cost system, 88, 339<br>Forma, 300<br>sources of data, 36<br>statements, 150<br>production-center system, 306<br>time clock, 167, 168, 170<br>Forma, 181<br>time tickets, 25, 35, 167-182, 331<br>Forma, 176, 178, 180<br>checking, accuracy of 189, 173<br>lost time, 175<br>piece-work system, 184, 186<br>Forma, 184, 186<br>piece-work coupons, 185<br>Forma, 186<br>standing order list, 227<br>Forma, 228<br>summaries, 171, 173, 177</td>
+ <td><strong>W</strong><br>Wages system, 309<br>basis system, 204<br>day-rate method,<br>advantages of, 195-197<br>differentiate rate method, 200<br>Gantt system, 204<br>premium method, 202<br>graduated method, 206<br>straight piece-rate method, 197-<br>200<br>failing rate, 198<br>tall clock system, 204<br>Wages (See "Labor," "Pay-roll")<br>Waste., f42, I45<br>wages coupons textile cost.<br><em style="text-decoration: underline;">adjustments on books</em>, textile cost.</td>
+ <td><strong>V</strong><br>control of cf., 65<br>premium system of wages stores before used, I50<br>Water., 253, 259 (See also generally "Fluctuations in wages)<br>Weighing of materials fluctuation in costs.<br><em style="text-decoration: underline;">Wood-working industries</em>, scrap.<br><em style="text-decoration: underline;">Wooden mill</em>(See also "Textile cost")<br>expense accounts chart., I21<br>Forma., I46</td>
+ <td><strong>X</strong><br>Work in process account., I53<br>accounts., I53<br>entries., I54<br><em style="text-decoration: underline;">Journal entry</em>, illustrated., I57<br><em style="text-decoration: underline;">Process method</em>, I59<br><em style="text-decoration: underline;">Production-center system</em>, illustrated., I64<br><em style="text-decoration: underline;">Standing order list</em>, illustrated., I64</td>
+ <td><strong>Z</strong><br>wage rates textile cost., I60-I64; I80-I89; I90-I99; II0-II9; III0-III9; IV0-IV9; V0-V9; VI0-VI9; VII0-VII9; VIII0-VIII9; IX0-IX9; X0-X9; XI0-XI9; XII0-XII9; XIII0-XIII9; XIV0-XIV9; XV0-XV9; XVI0-XVI9; XVII0-XVII9; XVIII0-XVIII9; XIX0-XIX9; XX0-XX9; XXX0-XXX9; XL0-XL9; XLX0-XLX9; XLXI0-XLXI9; XLXII0-XLXII9; XLXIII0-XLXIII9; XLXIV0-XLXIV9; XLXV0-XLXV9; XLVI0-XLVII9; XLVIII0-XLVIII9; XLIX0-XLI9; L0-L9; LI0-LI9; LII0-LIIN; LIII0-LIII9; LIV0-LIV9; LV0-LV9; LVII0-LVII9; LVIII0-LVIII9; LX0-LX9; LXI0-LXI9; LXII0-LXII9; LXIII0-LXIII9; LXIV0-LXIV9; LXV0-LXV9; LXVI0-LXVI9; LXVII0-LXVII9; LXVIII0-LXVIII9; LXIX0-LXI9; LI0-LIIN; LIII0-LIIIN; LIIV0-LIVN; LIVII0-LIVIN; LIVIII0-LIVINN;</td>
+ <td><strong>A</strong><br>Voucher register (See "Purchase Journal")<br>Varn manufacture (See "Textile cost")</td>
+ <td><strong>B</strong><br>Costs of production center system., illustrated., I64</td>
+ <td><strong>C</strong><br>Taxable income record or record., T46-T47;<br>T48-T49;<br>T56-T57;<br>T58-T59;<br>T66-T67;<br>T68-T69;<br>T76-T77;<br>T78-T79;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T86-T87;<br>T88-T89;<br>T...</td>
+ <td><strong>D</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>E</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>F</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>G</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>H</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>I</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>J</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>K</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>L</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>M</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>N</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>O</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>P</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>Q</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>R</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>S</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>T</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>U</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>V</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>W</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>X</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>Y</strong><br>Purchase order record or record., T46-T47;</td>
+ <td><strong>Z</strong><br>Purchase order record or record., T46-T47;</td>
+ <td></table>
+
+<img>A page from an index with various letters and numbers listed.</img>
+
+| Time records | Wages system |
+|---|---|
+| Forma | bonus system |
+| payroll | day-rate method |
+| Forma | advantages of |
+| Forma | of |
+| Forma | differential rate method |
+| charts | Wages |
+| Forma | Gantt system |
+| Forma | premium method |
+| Forma | graduated method |
+| Forma | straight piece-rate method |
+| Forma | process cost system |
+| Forma | Wages |
+| sources of data | Wages |
+| production-center system | Wages |
+| time clock | Wages |
+| time tickets | Wages |
+| time tickets | Wages |
+| checking | Wages |
+| checking | Wages |
+| total costs | Wages |
+| total costs | Wages |
+| trading costs | Wages |
+| trading costs | Wages |
+| Twine factory | Wages |
+
+U Underwear factory
+Forma
+Uniform cost system
+Up-keep of buildings (See "Building-
+ing expense")
+
+V Voucher register (See "Purchase Journal")
+Y Yarn manufacture (See "Textile cost")
+
+<img>A blank white page.</img>
+
+<img>A blank white page.</img>
+
+<img>A blank page with a faint vertical line at the bottom.</img>
+
+UNIVERSITY OF CALIFORNIA LIBRARY
+Los Angeles
+
+This book is DUE on the last date stamped below.
+
+Form LB-021c 8/30(5676ut)444
+
+A 000 266 002 5
+
+<img>A black and white image of a textured surface, possibly fabric or paper.</img>
\ No newline at end of file
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