Fig. 18. Summary of Supplies Drawn
This report shows the value of supplies drawn each day by each department. The amounts can be entered daily from the requisitions, the totals being entered at the end of the week.
Summary of Administrative Expense. The reports and records described place the statistical department in a position to make complete summaries of administrative expense. The salaries of department and division heads, clerks, and stenographers employed in each department are obtained from the accounting department; mailing expense is obtained from the weekly report of the mailing clerk; cost of supplies drawn is shown by the supplies clerk's report; the amount of expense items not otherwise accounted for is supplied by the accounting department. The last item named—representing overhead expense—can be distributed to the departments on the basis of the ratio of the known expense of each department—that is, if the known expense, including salaries, mailing, and supplies, in one department is 20% of the known expense of all departments, it may be charged with 20% of the overhead.
Fig. 19. Form for a Distribution of Administrative Expense
Fig. 19 shows a form for a summary of all administrative expense, the different classes of expense being divided for each department. Totals of expense of each class, totals for each department, and the grand total are shown. Totals of the different classes and the grand total must agree with the records of the accounting department. At the bottom of the administrative expense summary the per cent of total administrative expense to sales and turnover—or cost of goods sold—should be shown.
Profit and Loss Statements. The profits shown by the comparative trading statement, Fig. 9, are trading profits only—not net profits, as administrative expense and profits from other sources than sales are not included. A statement should be prepared, therefore, which will show net profits. This can be combined with the trading statement, but the better plan is to prepare a separate statement. It is usually advisable to supply copies of the trading statement to the heads of all departments of the sales division that each may see what progress he is making, and compare it with that of other departments. It is not advisable, however, to let the department heads know the exact net profits; this information is for the general manager and directors.
Fig. 20 shows a form of monthly profit and loss statement, divided by departments. The totals for the fiscal year to the first of the current month are brought forward at the head of the sheet; then the figures for the current month are entered. Sales, sales expense, and sales profits are taken from the trading statement; administrative expense is shown by the summary, Fig. 19. Administrative expense is charged to the different departments on the basis of the turnover—that is, if the total administrative expense is 10% of the total turnover, each department will be charged an amount equal to 10% of its turnover.