CHAPTER 17 

 COMPLETE SET OF COST ACCOUNTS 



IF instead of keeping accounts with one crop or animal 

 as illustrated with potatoes, one keeps an account with 

 each enterprise on the farm, he will have a complete set of 

 cost accounts. There are some elaborate systems of double 

 entry accounts that have been devised, usually by persons 

 who have never actually done any real keeping of cost ac- 

 counts on farms. It is very rarely that any such system 

 is advisable on a farm. One must ever remember that 

 cost accounting is an entirely different thing from ordinary 

 bookkeeping. All that is necessary to have a complete set 

 of cost accounts is to have an account, just like the potato 

 account, with each enterprise on the farm. 



There are many advantages of such a set of accounts. 

 Instead of accounting for only part of the labor, the entire 

 labor of men, horses, and equipment is accounted for and 

 charged to some account. Instead of guessing at what 

 these are worth, we find what an hour of horse or man 

 labor really costs. 



With such a set of accounts, there are always two entries, 

 except for cash transactions. If one has an account with 

 both the hay field and horses, he will charge the horses 

 with hay at the same time that he credits the hay field with 

 what the horses ate. If the hay was bought for cash, no 

 entry is necessary except the charge to horses. If one 

 desires, he may keep the cash account also. He will then 

 have his accounts by the double entry method, but this 



440 



