Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1922-10-06
fco,.inued from Page Two)


~ O.. conducted in the Job De-
n,rtment are these:
numbered Job Ticket or enVel-
., made out with the necessary
o;ecations of the stock and ink
no used and work to be done, this
..,one containing the copy for the
job. s..o, IN tho n,.n+
.. .ssipned a Lot Number, and pur-
80, 70 the requisition the stock
- cuts the stock and enters on a
Lii report sheet the Job Number,
ssroe Of Customer. Lot Number and
moun, OF stock. This daily report
we, is posted by the Cost Clerk
~ the lob Stock Inventory. This
I.vsr,orv is a loose leaf record run
n,,p by Lot Numbers, the arrange
went OF the book and Its specially
Ie,ised index being such that any
ca Of stock in the plant may be
-.,6fv located. and the cost and
amount on hand be ascertained at
glance.
r,cb operative keeps a Time Card.
and by the use of JOB NUMBERS
ro-k classification numbers and
.re clock. records in detail the time
md character Of his work on each
.oh and the time and character OF his
interchangeable time, that is, time not
clargeable 70 any job.
These Time Cards are posted by
the Cost Clerk daily to the Individual
Ion summaries of the corresponding
,,nhers each Of which contains the
de.ailei record of the labor and ma
,e,,al entering into particular 10t.
TIE Time Cards are then given to
,to Paw Roll Clerk. who enters them
., specially prepared sheets for the
..o. told purpose, first Of the weekly
paw Roll. and second of the distrl-
tu,ion OF the time to the several
Factory Departments and expense &C
c..n.s IN accordance with the char
ar.er of the work done. At the end
cs ,he month the Pay Roll clerk as
sembles on single sheet the
charseable and interchangeable time,
ard their respective cost in eat De-
rartment and Expense account, to-
gcther with certain additional figures
and percentages which form the rasis
Of special computations at other
points in the cost system.
AZ the end Of the month prelim-
mary trial balances of the General
and Factory Ledgers are taken, and
nom these and other sources the
Ieeessary figures are assembled on
the Job Cost Summary Sheet pre-
vously described.
Going back for moment to the
Irdividual Job Summary, the cost
70 the concern % the time consumed
On pa 'ticular Job in the various
Factory Departments is not only tne
wages paid to operatives, but also al
I'VE other elements OF cost in each
department., namely the fixed. cur
rent and general expenses. The Jot
cost Sheets have assembled all these
wages and expenses, month by month
and show the avcra~o cost per hOul
For each Department for the pre-.
cading - months. The concern mus
charge it's Gus. omers sum suff1c'eh
10 return this cost. with an added
per centage of profit. On the in
dvidual Job Summary, therefore, TIKI
Total time consumed in each Depart
mcnt is multiplied by the hour cos
~ that Department, and the stipu
lated per cottage of profit added. II
tho actual cost Of the materials il
added n per Centage for stock handl
'rg and to the Cost of Completed
fn
selling Expense. OF course. by rea
son Of special contract price. or o
unnecessary time consumed and tn
Ike, the amount actually billed tn
customer may differ from the amo un
rorked out as above, but in the ag
grogate the concern must get bacl
the amount revealed by its COS
sheets. and something more, If it il
To continue in business. If parti
cllar Job is billed at less than thi
amount. II shows loss which il
embodied in the results shown OF
Ne Summary Sales sheet at the emf
Of the month.
8 The Method Of Interiocking tn
General Accounting System will
the Cost Finding System
For statistical and accounting pur
poses IL Is necessary to ascertain il
ire actual cost. month by month. b.
means Of the cost sheets previousl.
doCrlhcd. hut because Of fluctuation
die 70 productive activity. suddel
and abnormal expenses and the like
4 Is not practical to use the actua
months cost. either in estimating o
charging jobs. The set-up cost i
therefore used. which is ordinaril.
'he average cost ascertaned for TIL
preceding twelve months. Incident
ally II is to be noted that the month
~ inventory Of uncompleted jobs o
Work in Process. which is one Of tn
assets OF the business and must ap
pear on the Monthly Balance 81 eet
. computed on the basis Of this set
up cost
\ General Ledger Account entitle,
"Reserve for Overhead" absorbs tn
ference between the actual and tn
sct-np cost. and Is added to or de
dUcted from the Net Profit on tn
Monthly Income and Expense State
trent, IN order TO show the actua
profit
Ry the joint operation of the Re
Hsrve for Overhead, the Work II
Process account. the Sales Register
the Cost Summary. the individual
f'b Summaries and the Trial Bal
'nces. the General Accounting Sys
''m and, the Cost Finding System ar
ted together in a manner ensurin.