Manufacturing costs and accounts . Total Total % Mfg. Fia. 94.—General diagram for Method C (Facing Pagt 352.) COSTING ON METHOD C 353 shop or department cost of the product at all periods irrespectiveof the slackness or otherwise of the shops. If it takes $40machine time to do a certain job today when the shop is busy,it should not take any more machine time next month when theshop is slack. But if the machine should earn $80 in a month,and thus be capable of doing two such jobs when the work isthere for it to do, that is no reason for charging $80
Manufacturing costs and accounts . Total Total % Mfg. Fia. 94.—General diagram for Method C (Facing Pagt 352.) COSTING ON METHOD C 353 shop or department cost of the product at all periods irrespectiveof the slackness or otherwise of the shops. If it takes $40machine time to do a certain job today when the shop is busy,it should not take any more machine time next month when theshop is slack. But if the machine should earn $80 in a month,and thus be capable of doing two such jobs when the work isthere for it to do, that is no reason for charging $80 as machinetime to the job in the slack season. It is much better, and willmake the situation much clearer to everybody if we expressthe cost of the job in the slack season in two parts thus: Machine time $40 Supp. rate 40 Factory cost $80 There are certain cases when wasted manufacturing capacitymight be required as a separate item. Thus, if we have tomaintain a repair department in connection with our product ina certain locality, the prices which we get for our work beingregulated by comp
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