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82 HASKINS & SELLS September Accounting for Milk Distributing Companies BY F. H . SANFORD, of the New York 39th Street Office THE business of distributing milk has within the past few years been the subject of numerous investigations, official and otherwise, due principally in the begin-ing to the strenuous objection on the part of the public to the steady advance in the price of the commodity. One result of these investigations has been to change the status of the industry from a private to a semi-public character, somewhat comparable with power, light or coal companies. It seems probable, considering the great importance of milk and its by-products, butter, cheese and cream, as articles of human diet, and the relationship between the milk supply and the health of the children in a community, that the trend toward public regulation of the industry will continue. A sufficient supply of pure milk at fair prices is necessary to the health and comfort of the community. What constitutes a fair price, whether the subject be considered from the point of view of the distributor or the regulating authority, must be determined from an accurate knowledge of the original cost of the milk, plus the costs incidental to its distribution. What these costs are can best be determined from an adequate system of accounts, properly kept. While most of the larger companies have such systems, enough others do not to make the preparation of a comparative statement of the costs of several companies operating in the same territory far from a simple matter. The accountant, therefore, should be fully informed as to the progressive stages of purchase and distribution to the end that he may so conduct an examination as to ascertain the costs of these operations, or, in the case of a system engagement, so design the accounts and records that these costs may readily be determined, and the selling price of the commodity accordingly justified. The following statement of sales, cost and profits is the form used by the several large distributors as evidence submitted at a hearing before the Milk Committee of the United States Food Administration, for the purpose of fixing the prices for bottled grade " B " milk in New York City for the month then ensuing. EXHIBIT " A" COUNTRY, BOTTLED—RETAIL: Quarts sold, Sales, Cost—Schedule No. 1: Up to delivery, Delivery, etc., Total cost, NET PROFIT, EXHIBIT " A" SCHEDULE NO. 1 Amount per quart QUARTS SOLD, COSTS UP TO DELIVERY, Purchases, Country—Can station expenses, Country—Factory expenses, Freight and ferriage, Hauling—City, City factory expenses, Depreciation. Total, COSTS OF DELIVERY, ETC.: Branch operation and maintenance, Delivery expenses, General, selling and administrative expenses, Depreciation, Deduction from sales, Shrinkage, Total, TOTAL COSTS,
Object Description
Title |
Accounting for milk distributing companies |
Author |
Sanford, Frederick Haniman |
Subject |
Milk trade -- United States -- Accounting |
Office/Department |
Haskins & Sells. New York Office |
Citation |
Haskins & Sells Bulletin, Vol. 04, no. 09 (1921 September 15), p. 82-86 |
Date-Issued | 1921 |
Source | Originally published by: Haskins & Sells |
Type | Text |
Collection | Deloitte Digital Collection |
Digital Publisher | University of Mississippi Libraries. Accounting Collection |
Date-Digitally Created | 2009 |
Identifier | HS Bulletin 4-p82 |