Small Tools. Most small tools are purchased, but some of them may be made in the plant. These tools may be purchased singly, or in lots of one dozen, or in other quantities. To meet these conditions the form, Fig. 17, provides for a record of date of purchase, description, quantity, unit, material and labor costs, per cent and amount of burden, and total cost. When the tools are purchased ready for use, only the last money column is used.
Drawings and Patterns. This inventory includes all drawings and patterns that are in use or of value to the business. In placing a value on this property, conservatism is necessary. A new pattern is supposedly worth what it cost to manufacture it. But a pattern may become obsolete in a very short time. It is necessary, therefore, when taking the inventory, to estimate the probable life of all patterns, basing this estimate not only on wear and tear, but on the probability of their being replaced by later models. The cost of drawings and patterns should be entirely absorbed in the cost of the goods manufactured, and to cover this a very liberal rate of depreciation must be provided. In the inventory form we do not show the depreciation, as we consider it more practicable to take a complete inventory, and make a new appraisal of drawings and patterns at the end of each fiscal period. The form given for this inventory, Fig. 18, shows date put in stock, the number, description, and details of cost.
Material and Supplies. The inventory of material and supplies includes all material which goes into the construction of the goods and all supplies required in the operation of the plant.
In recording this inventory, supplies and material should be kept separate, and each should be thoroughly classified. One sheet should show but one special class; that is, if one of the items is hardware, nothing but the hardware inventory should be included on the same sheet. This form, shown in Fig. 19, gives the description, the purpose for which the material is used, quantity in stock, unit of measure, unit value, and total value.
Parts and Finished Stores. This section is intended to include all finished parts in a plant manufacturing parts to be later assembled into complete machines, also any finished stores or semi-completed parts. Under the latter head would come such items as castings, which are made in advance, to be used as needed. This inventory is recorded on the form shown in Fig. 20, giving the description, for what used, the number of the part, quantity, unit, unit value, and total value.
Work in Process. Under the head of work in process is included all partially completed orders in the plant at the time of inventory. If an efficient cost system has been maintained, it will not be a difficult matter to arrive at accurate costs of all such material. Without a cost system it is necessary to use extreme care in estimating the cost of material and labor to date.
One of the most important items of information in this inventory is the last operation, which means the last completed operation. It is necessary to have this information before we can figure the actual cost. The form for this inventory, Fig. 21, includes description, name of last operation, cost of material, cost of labor, per cent and amount of burden, and total value.
Manufactured Goods. The inventory of manufactured goods includes all goods completed ready for the market. In a trading business this would include the regular stock in trade. Fig. 22 shows a form for the inventory of manufactured goods, which, with slight changes, would answer the purpose for the stock in a trading business. The form shows the order number (meaning the shop order number on which the goods were manufactured), the description, the quantity, the material and labor costs, the burden, and total value.
When these inventories are completed, and the extensions made, it will be seen that a complete record of values of all physical property is provided. From these records the ledger accounts should be adjusted so that all records will correspond. The records also furnish the necessary information from which to make the stores record, which is necessary when installing the system.
These inventory sheets may be filed either in the drawers of a vertical file or in a loose-leaf binder, though the latter is preferred. The sheets for each class should be kept by themselves and classified as explained above. The index may be alphabetical, or blank indexes, on which the names of the classes are written, may be used. The sheets in each class should be numbered consecutively and kept in numerical sequence.