MILK PRODUCTION COST 

 ACCOUNTS 



CHAPTER I 



THE FUNCTIONS OF A COST SYSTEM 



A COST system has for its object not only a direct benefit to 

 the particular dairyman who keeps accurate cost accounts, but 

 also an indirect benefit to the public by making it possible to 

 put the dairy business on a sound basis throughout the 

 country. 



The ends to be attained by a system of cost accounts for 

 milk production are: 



1. To regulate selling price. 



2. To detect, locate, and eliminate waste in material, labor, 

 and other expenses incident to production. 



3. To change any operation and determine the actual effect 

 on cost. 



4. To enable the manager to direct the work with greater 

 efficiency. 



5. To make it possible to standardize the work. 



6. To compute costs at different times and under different 

 conditions. 



7. To provide reliable statistics for comparisons and studies 

 in different States and localities. 



Almost every dairy in the United States is a part of a gen- 

 eral farm proposition, and without cost accounts for the dairy 

 itself it is impossible to determine to which enterprise profits 

 or losses are due. Although a dairy farmer may be getting a 

 fair interest on his capital and a fair wage for his labor, sur- 

 veys or cost records of his dairy often show that the profits 

 are not derived from the cows. When the feeds are figured 



