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36 BULLETIN 1095, U. S. DEPARTMENT OF AGRICULTURE. 
The income and expense statements should show in detail just 
which phases of the business are most profitable, the net profit or 
loss, and all the facts relative to the operation of the business for 
the period, as well as comparison with the previous period. The bal- 
ance sheet should reflect the exact financial condition and should 
also show comparison with previous periods. The cost reports must 
show the unit cost (per quart) of every item of expense and the total 
cost per unit. 
QUANTITY RECORDS. 
Among the most important of all are the records of the quantity 
of milk handled through the various processes. Large volume (or 
quantity) is an important factor in a milk-distributing business, and 
for this reason unit costs must be closely watched. No manager can 
form a correct judgment of the efficiency of the operations unless 
he has the total quantity to compare with the total cost, and an ac- 
counting system arranged to show such information will be the 
best possible tool with which to ward off business failure. 
It would be impossible to put too much emphasis on the importance 
of keeping adequate quantity records. 
COST OF KEEPING ADEQUATE RECORDS. 
A word of warning might be spoken regarding the operation of an 
accounting system. It is often looked upon as a necessary evil, the 
expense of which should be reduced in every way possible, and especi- 
ally by such methods as the employment of low-salaried, incompetent 
bookkeepers, whose only recommendation is too often the small sal- 
aries for which their services may be secured. Unquestionably book- 
keeping and all office expense should be kept as low as possible, but | 
any reduction which tends to confuse and distort the information — 
which a properly operated accounting system can furnish for the — 
guidance of the management should not be considered for a moment. 
Without these important reports, those responsible for the direction 
of the affairs of the organization have no information on which to 
formulate the policies of management. Under these conditions | 
proper guidance of the business is an impossibility. 
A first-class bookkeeper will prove an exceedingly valuable asset; 
and after his work is done, to reap the best benefits possible from } 
an adequate accounting system, nothing can take the place of a regu- | 
lar independent audit by a reputable firm of public accountants. 
The cost may seem excessive, but it will not be when compared with } 
the benefits derived from it. | 

