Cost accounting to aid production; a practical study of scientific cost accounting

This historic book may have numerous typos and missing text. Purchasers can download a free scanned copy of the original book (without typos) from the publisher. Not indexed. Not illustrated. 1921 Excerpt: ... it is possible to ascertain the amount of scrap that is to be transferred to the scrap inventory account, it will be necessary to credit the scrap clearance account with the actual and standard values of scrap used in production. The current price of scrap so used will be charged to the scrap reclamation account (Form J) where labor on reclamation will also be charged, thus making a total of scrap metal and labor on reclamation which represents the cost of producing blanks from scrap. In as much as nearly all blanks are bought from the outside, it is proper to credit the scrap reclamation account with the value of such blanks at the price for which they are purchased on the outside, carrying any balance to the credit or debit of profit and loss account, as representing additional profit or loss to the profit or loss made in the regular course of operation. The credit to scrap reclamation account for blanks made will be offset by a corresponding debit to the appropriate material account: in the latter account the entry in the actual column being the amount credited to scrap reclamation, the entry in the standard column being the regular standard cost of the blank. Burden D1str1but1on A Matter Of Judgment The exercise of the faculty of judgment is of particular importance when determining methods to be employed in connection with burden distribution. There is no one plan of distribution applicable to all classes of business, and refinements of distribution which in one case would be of the utmost importance in another would be absurd. For instance, in a business such as that of the manufacture of bolts and nuts where the cost of tools is very great and where high efficiency of operation depends very largely upon the wearing quality of tools, it is necessary ...