Ellis Mast Sowell, The Evolution of the Theories and Techniques of Standard Costs (The University of Alabama Press, 1973).
Reviewed by Kenneth S. Most Texas A & M University
This university press publication of a history of standard costing, a previously unpublished 1944 doctoral dissertation, fills a curious gap in the English language literature. Charles Weber's history, in German, dates from 1960, but covers only the American contribution. Sowell reviews evidence of cost calculation and bookkeeping before the late 19th century and identifies Garcke and Fells, an engineer and an accountant, as the first to recommend integrated financial and cost accounting. He traces the transformation of English cost estimating procedures into systems of standard costs and em-phasizes the influence of engineers throughout.
Shortly before 1900, American and English accountants took up the engineering ideas of standards, comparison with actuals and analysis of variances; starting with Emerson and Nicholson (1908-9), American theory and practice prevailed. The two national influences, however, met in the person of Charter Harrison, an English bom and educated accountant who practiced in the USA, and who started laying the foundations of the theory of standard costing around 1911.
Besides tracing the progress of cost estimating in English manu-facture, including the medieval guilds, and the influence of the scientific management movement on cost accounting, Sowell de-votes chapters to the history of accounting for materials, labor and "burden"; his remark on the paucity of principles in works on standard costing rings as true today as it did in 1944. It is interesting to note that neither direct standard costing nor the behavioral prob-lems which arise out of the influence of wage premium systems on the development of standard costing, was important enough to merit attention thirty years ago.
The only major defect in Sowell's argument is his distinction between an estimate and a standard, which remains unclear throughout the book. In one place it lies in the fact that "an estimate is a cost which will be as nearly representative as possible of the actual costs to be incurred," but some of the standard cost pro-