388 APPENDIX 



ventory price can be determined more easily by estimating 

 downward from the market price. For example, the first time 

 a colt or calf is inventoried it should be shown at approxi- 

 mately 10% below its selling price at that time. The same 

 principle should be followed in each subsequent year. After any 

 given animal is full-grown, it should be inventoried at the same 

 unit value each year. 



Products: Grain and feed should be inventoried at cost 

 price. This is determined from the Crop account in any specific 

 instance under a cost system as described in Operation of 

 Crop Account, Chapter IX. When the cost price of grain and 

 feed is not available, inventory such products at approximately 

 10% below a fair average market price for the several months 

 preceding the day on which the inventory is recorded. Using 

 such an average market price tends to minimize the effect of 

 any exceptionally high or low prices that might exist on the 

 inventory date. 



Miscellaneous Supplies: Cement, nails, barbed wire, axle 

 grease and other commodities commonly listed under miscel- 

 laneous supplies inventory usually have a known unit cost 

 price available. Such cost price should be used in pricing the 

 portions of the commodities on hand when taking an inventory. 



Household Furnishings: The simplest way of inventorying 

 the articles in the house is to place a reasonable nominal value 

 on the entire lot of furnishings, say $500, $600, or some other 

 round amount, and use the same amount from year to year. 

 The amount used should be about 25% less than the a 

 gate cost at time of first appraisal for inventory of all house- 

 hold furniture, carpets, rugs, pictures, clothing, jewelry, dishes 

 and kitchen utensils. After such appraisal, any subsequent 

 purchases of any of the articles named above should be charged 

 to the Household account, but should not increase or decrease 

 the inventory figure. This last statement is subject to modifi- 

 cation only in case the general scale of household furnishings 

 is raised materially as a result of a marked refurnishing of the 

 house with substantially better articles. 



The object in advocating such a simple but apparently un- 



