Loss on Defective Castings after Shipment: (See Note 5 below) 
Difference between the sales value and the scrap value of castings shipped to customers and re- 
jected, plus the freight, etc. 
Charges for work done by customers to make the castings meet their requirements. 
Cost of labor at foundry in making castings rejected and returned by customers suitable for 
acceptance by such customers. 
Depreciation: (See Note 6 below) 
For depreciation of entire plant and its equipment. 
Clerks’ Salaries: 
Includes salaries of all clerks and stenographers, except department clerks in the metal, mold- 
ing, core, and cleaning departments. 
Accounting Department: 
Salaries, wages, material, supplies, and other charges used in operating the accounting depart: 
ment, 
Management Salaries: 
Works manager, assistant works manager, general superintendent, etc. 
“ngineering Department: 
Salaries, wages, material, supplies, and other charges used in operating the engineering depart- 
ment, 
Purchasing Department: 
Salaries, wages, supplies, etc., used in oy erating the purchasing department. 
Miscellaneous Operating Expense: 
Labor :—Wages of employes engaged in work of a general nature and not otherwise specified, 
such as watchmen, janitors, police, experimental, and development. 
Material :—Material and supplies of a general nature and not otherwise specified, such as tele- 
phone, telegraph, stationery, ice. lauadry, traveling expense of operating men, etc. 
[nventory Adjustment: 
Reserve fund for inventory adjustment to be created by charging to costs monthly an amount 
based upon a predetermined rate per net ton of good castings produced. 
Administrative Expense: 
Salaries and expenses of executives 
Head office rental 
Legal expense 
Subscriptions 
Dues 
Directors’ fees 
Expense: 
Salaries and commissions of salesmen 
Traveling expense of salesmen 
Clerks, stenographers, and others in sales 
department 
Advertising 
Note 5. Preferably a reserve fund for loss on defective castings after shipment should be created by 
charging to costs monthly an amount based upon a predetermined rate per net ton of good castings, or an 
imount based upon a predetermined percentage of total sales to customers. 
Note 6. Depreciation should be provided for regularly each month upon some definite and suitable 
sasis. and charged to monthly costs. 
Note 7. A reserve fund for doubtful accounts or bad debts should be created by charging to costs 
monthly an amount based upon a predetermined percentage of total sales, or an amount based upon a prede- 
termined rate per net ton of good castings.