CHAPTER XVI 



COST OF MANUFACTURING BUTTER 



The items to be considered in determining the cost of manu- 

 facturing butter have been discussed in the foregoing chapters, 

 and may be briefly summarized as follows: 



Labor, direct and indirect. 



Coal and power. 



Ice and refrigeration. 



Water. 



Butter tubs, boxes, liners, and wrappers. 



Salt, color, washing powder, and miscellaneous supplies. 



Rent. 



Interest on investment. 



Insurance. 



Taxes. 



Depreciation. 



Repairs. 



It is only by exhaustive study of each factor which adds to the 

 manufacturing cost that a manager will be able to reduce such 

 cost to the minimum. 



The size of the creamery is one of the primary factors that 

 influence the cost of manufacturing. If the receipt of raw 

 material is small the cost of manufacturing a pound of butter 

 will naturally be high due to fixed expenses which cannot be 

 reduced. Wright " found that the cost of manufacturing a 

 pound of butter in the Iowa creameries was as follows: 



• i8th Annual Report, 1904, of the Iowa State Dairy Commissioner. 

 198 



