Omaha daily bee., 1915-07-11
PLAN FOR CREDIT EXTENSION
Trade Commission Proposes System
to Aid Smaller Factories and
Retail Stores.
STANDARD FORM OF ACCOUNTS

Edward n. Hurley OF the Feoera Iraue
commission. IN statement today sug-
costing plans by which the commission
NAV give constructive help 20 American
business. emphasized two methods which
he considered Of particular Importance.
zone OF these" said Mr.. Hurley, In his
statement, is to aid the business men OF
the country in obtaining the additional
credits TO which their business operations
may entiue them The second is to aid
In establishing a standard system OF
bookkeeping and cost account. The two
are interdependent."
THE commission has In mind, Mr. Hur-
ley announced. dividing the country into
zones and maintaining in each. experts
In accounting, costs and manufacturing
upon whom manufacturers. merchants
and business men may call for advice
and assistance in establishing economies
Credit OF Smaller Men Limited.
The small manufactures, the country
storekeeper, and the retail merchant az
a rule" he said. do not get all the
banks credit that they ought 70 receive,
owing 10 the fact that they are unable 70
present balance sheets in accordance with
good business practice. These men are
Just as good business men in many
respects, as those Of larger operations.
They have brains. ability. knowledge OF
their wares and of their customers. but
they 40 not speak the language OF the
banker In that they are not able to
present q statement showing their true
assets and liabilities.
Frequently a business man with a
credit Of a few hundred dollars at his
bank. based wholly on personal grounds.
could. II he could produce reliable bal
ance sheet, readily obtain several thou
sand dollars which would enable him to
expand his business along sound lines.
Failing to obtain Il. his business IL limited
and confined.
Bankers are In business 20 loan
money TO business men, and recognize
that loans made on balance sheets that
are sound are desirable loans. The
banker will welcome any standard OF
statement that will permit him easily to
ascertain the exact liabilities and assets
bf his customer.
standard IL Needed.
1T Is recognized that no ono standard
form OF accounting can be applied TO all
classes Of business. and that special
forms must be devised for each group
or class of commerce ana industry. For
example, the coal industry can use one
standard system Of accounting. Amons
others the country store and general
store retailer, the wholesale grocer,
the boot and shoe wholesaler, the boot
and shoe retailer, the drug store, the
manufacturer OF textiles. the manufac-
turer OF machinery. the wholesale
clothier, the retail clothier. each must
have his own special system. But u Is
true that a great many Of these farms
could be adapted for use In lines other
than those for which they are originally
arranged. as certain fundamental prin-
ciples underile the general structure OF
accountancy and must be recognised Dy
each group ,a.,
THE fact must be sdmitted that n
order TO put selling price on your
products you must. II you be a manufac-
turer. first know exactly what It costs
YOU 60 manufacture and sell them. When
business was done on large percentage
Of profit this was not 30 essential. but
IN most lines Of industry today the large
percentage Of profit has passed. We are
working on a smaller margin ana we
must absolutely know what our goods
cost. ANY old and out-of-date method
OF arriving at cost figures. without mar
gins Of profit 30 close. must be elimi-
hated.
1T IL a fact we'll understood among
business men that the general demorali-
zatIon In a large number Of Industries
has been caused by firms who cut prices
not knowing what their goods actually
cost 10 manufacture; and the cost Of
selling, which Is equally important. Il
almost wholly lost sight OF.
Cost service L. Needed.
How can the Federal Trade commits
sion help cure these conditioner BY no
compulsory methods. Tine commission
has no power and no desire TO use such
methods. But the commission does hope
TO reach the desired end by putting al
The service cf the manufacturers and
merchants who have not had the ex-
perlence or advantages that larger firms
possess, the accountants. bookkeepers
and experts In cost Of production that
are employed by the commission, and IN
that way to help strengthen American
industries where they are weak. These
services will be rendered only on the
request OF the Individual merchant OF
MANUFACTURER WHO uctifca thcu
TN European countries, manufacturer
and merchants. aided by their govern
ments, have developed high state Of
efficiency. which enables them TO sell
their goods Ia the markets of the world
The Federal Trade commission desires
to do what Il can 20 help bring the
American manufacturers and merchants
on equal terms Sith these foreign com.
petitors IN order that We may be able Il
get and hold our share OF foreign trade
when there is completed within the
commission the organization for aiding
business. any manufacturer or merchant
on request may receive ca an approved
form for presentation 10 his hank wher
seeking credit;. % a form designed q
show accurately and concisely HE asset
and liabilities. stock on hand. etc; Cc) {
form of double entry Bookkeeping adaotet
70 his class Of business. as well az (d)
form and method OF arriving at costs
aiso adapted 70 his line OF business. Al
Of these sample forms viii be simple II
character and can be supplied by IN.
local printer. II IL hoped that the off
ferent banks throughout the country vii
carry supplies OF these forms for IN,
horcfit o. their customers"
Slx-TEAR-0LD GIRL IS