SELF-SERVING IN RETAILING FOOD PRODUCTS. 41 
termined accurately. The methods by which this can be deter- 
mined vary greatly, some being very simple and others very com- 
plex, depending upon the amount and kind of information desired. 
The subdivision of expense accounts is all that will be dealt with 
here, since that is of special interest, and also since accounts of this 
nature are not kept as commonly as might be considered desirable. 
In order that an intelligent view of the cost of operation may be 
had, the expenses should be subdivided into 10 or 15 accounts. An 
enumeration of the possible accounts, together with a brief descrip- 
tion of what they should consist of follows. 
1. Management. 
To the management account should be charged all office supplies 
and expenses, such as telephone, stationery, and postage, together with 
office wages and management salaries. A special buying-expense 
account is sometimes maintained in establishments large enough to 
warrant handling the matter in this way. It is assumed here, how- 
ever, that buying expenses will be included in management ex- 
pense. To this account should be charged the actual management 
salary where such a salary is paid. When no management salary is 
paid, the account should be charged with the salary the manager 
could command when working for some one else, and the offsetting 
credit should be made to the owner's personal (drawing) account, to 
which all checks by him for personal use should be charged. 
2. Rent. 
Actual expenditures for rent should be charged to the rent ac- 
count. 
3. Interest. 
Interest paid should be charged to an interest account. Some ac- 
countants treat interest not as a part of operating expense, but as a 
deduction to be made from net operating profit, in order that the 
true net income may be ascertained. (See Form I, p. 50.) 
4. Insurance and Taxes. 
To the insurance and taxes account should be charged all taxes on 
the stock or equipment or on the volume of business, the cost of local 
licenses, and Federal revenue taxes except income taxes. The cost of 
fire insurance on the stock and equipment, employees' liability in- 
surance, and burglary insurance should be charged to this account. 
Where premiums are paid for fire insurance on the building, however,' 
they should not be charged to this account, but to a realty operating 
account. If the insurance and taxes account is properly kept, in- 
surance and taxes can be separated readily for income-tax purposes. 
