—All purchases of every nature that can be charged directly so are distributed from purchase vouchers. The departmental manager and foreman have a direct interest in these and usually look out for all supplies and like expense items.
Inventories.
—An actual physical inventory is taken at the terminating date of each month or period, making a record of the items of every nature on hand that is a liquid asset and not usually including interests which are charged off as an item of expense.
Store Account.
—To avoid duplication of purchases of material used, it is usual to have a general store in which these are carried and dispersed to operating departments on order. This store account usually includes the distribution of mechanical labor, such as pipe fitters, carpenters, machinists and labor of similar classes, being charged out to the department requiring their services.
Labor.
—Plant labor is a large item of the expense of manufacture and one that is controllable within measure by the management. There are certain standards of divisions recognized by practice and for such departments if the business be large it is well to have a weekly analysis and a cost per unit developed. For a lesser business, monthly will serve. This expense item keeps the departmental men on the alert and serve as a basis of distribution of labor for departmental ledger purposes.
A system of labor classification is as follows:
(1) Cattle Yards.—All labor in the care of cattle from arrival at plant, and delivering into knocking pens.
Includes expense items of caring for cattle, cleaning pens, troughs, feeding and driving.