COST ACCOUNTING 



263 



ILLUSTRATION 53 



YEARLY HORSE LABOR SUMMARY USED AS A BASIS 

 FOR DISTRIBUTING EQUIPMENT EXPENSE 



' See ' ' Horse Labor Record, ' ' page 232. 



For example, if the horse labor record for the year shows 

 the totals indicated in Illustration 53, and the balance of 

 Equipment Expense account is $200 at the close of the 

 year, the machine cost per hour is $200 divided by 4000, 

 or 5 cents. This means that for every hour horses are 

 used in connection with a farm element, such element is 

 responsible for 5 cents' worth of repairs, depreciation 'and 

 interest on the equipment. 



Applying this 5 cent rate to the farm elements recorded 

 in the yearly Horse Labor Summary of Illustration 53, 

 the household is charged with 1160 times .05, or $58, for the 

 use of equipment during the year. Likewise, the other ele- 



