Document Type
Article
Publication Date
1921
Abstract
Attention has often been drawn by accountants and others to the failure of a large percentage of manufacturers to adopt the methods of cost accounting approved by the majority of professional accountants, but as far as the writer knows these criticisms invariably have been directed at the manufacturer and not at cost methods themselves. It does not seem to have occurred to these critics that if a large body of intelligent and practical men consistently refuse to introduce the recognized methods of cost accounting, this refusal may be due not to a lack of progressiveness but to a deliberate judgment that the advantages to be gained from these methods are not of sufficient value to offset the expense of their acquirement. That the failure of many manufacturers to introduce complete systems of cost accounting along the lines approved by the accounting profession is due to design rather than negligence would seem to be a reasonable supposition, for in general the average manufacturer is willing enough to spend money for innovations if he is fairly well satisfied that he will obtain an adequate return from his investment. In many cases he has cautiously waited to see the result of cost experiments in a neighboring factory and often after noting the considerable number of clerks required to maintain the new cost system has concluded that it would have to be a very remarkable system indeed to produce savings sufficient to offset the resultant increase in the pay-roll. He usually decides, therefore, to spend his money on something from which he is more certain of receiving a substantial return.
Relational Format
pamphlet
Series Title
Official Publications of the National Association of Cost Accountants, 1921 (June), Vol. II, no. 15
Recommended Citation
Harrison, G. Charter, "What is wrong with cost accounting?" (1921). Publications of Accounting Associations, Societies, and Institutes. 94.
https://egrove.olemiss.edu/acct_inst/94