Efficiency Methods
An Introduction to Scientific Management

THE COSTING DEPARTMENT 43 be occupied only for a few minutes in placing the blank wheel in the machine, making a few adjust- ments, and starting the machine. The rest of the work, except for occasional scrutiny, occupies no workman’s time at all, the process being entirely automatic, and therefore the cost of the order is very incorrect if it is charged on a basis of wages. To obtain the actual cost the expense of running the machine is really the important item; and it is obviously very inaccurate to add a “ flat rate ” percentage to the value of the workman’s setting-up time, and charge this as the cost of the work. The determination of the cost of running machine tools is a difficult and highly technical business which cannot be dealt with in this context. Enough has been said to indicate the importance of these and similar statistics in the costing office. Various methods of computation are now in use, and the subject is still in a very controversial condition. Special attention may be drawn to the articles of Mr. A. Hamilton Church during the last few years in the Engineering Magazine (U.S.A.), to his book, since published, entitled “ Proper Distribution of Expense Burden," and to another valuable American treatise by Mr. Holden Evans, of the U.S. Navy, “ Cost-Keeping and Scientific Management.” 1 / 1 The American journal Machinery, of which there is an English edition, had several good articles on Costing in 1915 and 1916. The Harvard University Bureau for Business Research has drawn up a system of Cost Accounting for Shoe Manu- facturers, and issued it as a bulletin. See C. B. Thompson’s Collection, p. 550.