226 



THE AGRICULTURAL NEWS. 



July 26, 1919. 



If we see from our costing analysis that the expenditure 

 on hibonr is obviously as low as it will go, we do not 

 worry about it. We concentrate on those items that 

 appear to be excessively high. 



The example just given will help to show the 

 general principle of costing. Costing is a different 

 system with entirely different aims to ordinary book- 

 keeping. Costing is internal and inter-sectional, or 

 we might say inter-departmental. In ordinary 

 financial book-keeping, statements of the gross and the 

 net profit over a certain period are aimed at, with the 

 collection of information showing the sources of the 

 profit, together with a statement of the assets and 

 liabilities existing at a certain date. In a complete 

 costing system, the aim is to show the profit or loss on 

 each section of the undertaking, after taking into 

 consideration the use of the assets employed therein. 

 The costing system, more especially in agriculture, 

 should aim at effecting economy in expenditure so as 

 to reduce the cost of production. It also helps to fix the 

 selling prices of the articles produced, especially in 

 relation to submitting tenders in competitive trade: 

 costing also supplies figures for future use, for checking 

 and regulating thi- various items of cost, and for 

 comparing om- year's production with another. 



The account books suggested for agricultural 

 costing by Mr. L. F. Foster, FL.A.A., F.C.I.S., who 

 has recently written on the subject, include (a) Goods, 

 Stock and Stores Received Book, (b) Sales, Stock or 

 Goods Outward Book, (f;) Transfer Book or Journal, 

 (d) Wages Book, and (e) Cost Ledger. Perhaps the most 

 essential book from the point of view of the system is the 

 Transfer Book. This book should be used for recording 

 transfers, apportionments ai.d adjustments, between 

 two or more accounts in the costing system, e.g., the 

 transfer of manure from the pens to the fields. No 

 transfer whatsover should be made except through 

 the medium of this book, as otherwise valuable and 

 mutual dealings between two sections of the estate 

 will be unrecorded in any book of original entry. 



In the case of free-housing for labourers, the 

 rental value of these hous.s should be debited to 

 the crops which the men have worked upon. Similarly 

 where land is drained, the cost of the drainage must 

 be written off to the particular fields drained over a 

 number of years, gay, five or ten. If the field is used 

 for crops, the variois crop accounts will bear the 

 annual charge ; if used for giazing, the accounts of the 

 ▼arious classes of stock grazed will be debited. 

 Administrative charges, and rent and taxes must be 

 apportioned equitably over the various sections of the 

 estate at the end of the yeai. 



If the financial books have been kept on adequate 

 and scientific lines, the profit as appearing in the 

 Costing Profit and Loss Account should e(jual the 

 profit as appearing in the financial books. When this 

 proof is established, the two systems, which in 

 themselves have no relation to one another, will be 

 absolute proof of accuracy as far as debits and credits 

 are concerned. 



Enough has been said to indicate the general 

 principles of agricultural costing. Every business 

 requires its own system, and consequently no one system 

 can be laid down for every business. For estate work 

 in the West Indies, costing shoulil prove immensely 

 valuable, though, on account of the extra work involved, 

 it might prove equally unpopular unless a costing clerk 

 were employed. There is no reason why a nutnber of 

 such clerks could not be trained, and obtain positions 

 on the larger estates. 



Costing, it is believed, would reveal many surprises 

 in West Indian agriculture. The expenditure on 

 artificial manures in .some places would be found to be 

 astonishingly high and the expenditure on cultivation 

 astonishingly l<nv. It would be most instructive to learn 

 the true costing for a ton of sugar-cane or a pound 

 of cotton in different places. It would then be possible 

 to see whether yield alone is the determining factor as 

 regards profit and loss. In England an Agricultural 

 Costings Committee has been appointed by the 

 Board of Agriculture, and farmers are being asked 

 to co-operate in the matter of providing accounts for 

 expert investigation. Useful results are likely to 

 follow from this new economic study of farming, and 

 it is a pity that we have not got an official Agricul- 

 tural Costings Committee in the West Indies. 



COLONIAL SUGAR STATISTICS. 



The Jnternniiniinl Sii!:nr ^ounuxl for -Tune 1919, pub- 

 lishes a Uriel but comprehen'<ive review of British Colonial 

 Reports for the year 1917-lS. In this the position of the 

 sugar industry in some of the sugar-producing colonies of 

 the West Indies, and in Mauritius is dealt with, the e.vports 

 for varying periods being presented in tabular form. 



The sugar and syrup industries of St. Vincent showed a 

 satisfactory increased output in 1917-1^, but doubt is 

 expressed as to whether this will be mHintained, owing to the 

 attention being given to Sea Island cotton. The total 

 quantity and value of sugar, syrup and molasses eiported 

 from this island in 1917 was — sugar l,l!i;4-,L'01, value .£1 1,.584 

 syrup and molasses Hi, 144 gallons, value £3,102, making 

 a total value, of £14,686. 



Stimulated by high prices, and assisted by favourable 

 conditions for crop production, the industry has established 

 a modern record for sugar in Jamaica with an export of 

 .■{2,000 tons for 1917, estimated to have realized .£672,000, 

 This represents double the saluo of the sugar crop if Jamaica 

 forty years ago, when sugar was the chief staple of t he ( Colony, 

 and fruit was still an unimportant minor industry. 



