Document Type
Article
Publication Date
1916
Abstract
It should be made clear at the outset that the cost department deals with cost accounting, with debits and credits, different in character but the same in principle as the debits and credits handled by the bookkeeper in the sales and cash records. Cost calculations are sometimes made entirely detached from the general bookkeeping, but it is very rarely that such records have anything like their full value, and their use is always attended by the very considerable risk that they cannot be proved by the showing on the financial books at the end of the year or other closing period. Only cost records which are tied in with the general accounting records in the treasurer's office will give complete control over the operating expenses of the factory, and enable the management to know at all times how much is invested in raw materials, work in process, and finished product; and also to know the cost of the goods which are being sold. A cost department, therefore, should not be engaged simply in cost finding, but rather in cost accounting, which is much broader work and much more valuable to the management.
Relational Format
article
Recommended Citation
Scovell, Clinton Homer, "Relation of the cost department to the factory organization" (1916). Individual and Corporate Publications. 51.
https://egrove.olemiss.edu/acct_corp/51