. Florists' review [microform]. Floriculture. ? .TrTirT^?^?T^T»q^'«7^^'" ? TX'^—r-ff57>n"^-,^rr Jdli 8, 1013. The Horists' Review COST AND OVERHEAD EXPENSE A DISCUSSION OF BUSINESS ARITHMETIC WHAT ABE COST AND EXPENSE? The Elements That Determine Price. The subject of cost and overhead ex- pense is one which should interest every man in this room. Generally these terms . aj'e not clearly defined by the business world. Too frequently the sell- ing price is based on the invoice price, without due consideration to the over- head expense of operating the business. To my mind, cost mea
. Florists' review [microform]. Floriculture. ? .TrTirT^?^?T^T»q^'«7^^'" ? TX'^—r-ff57>n"^-,^rr Jdli 8, 1013. The Horists' Review COST AND OVERHEAD EXPENSE A DISCUSSION OF BUSINESS ARITHMETIC WHAT ABE COST AND EXPENSE? The Elements That Determine Price. The subject of cost and overhead ex- pense is one which should interest every man in this room. Generally these terms . aj'e not clearly defined by the business world. Too frequently the sell- ing price is based on the invoice price, without due consideration to the over- head expense of operating the business. To my mind, cost means the invoice price of an article, plus the expense of doing business on a certain number of dollars' worth of sales. If the in- voice cost of the article is $1 and it takes twenty per cent of the selling price to cover the expense of doing business, then the cost should be con- sidered $ instead of $1. It will then be necessary to add the per cent of profit which it is desired to earn. Manufacturers who change the form of a commodity have solved the prob- lem of the relation of overhead ex- pense to cost. By adding the item of overhead expense to the cost of their raw material, they know the exact cost of the manufactured article when it is placed in a packing case to be for- warded to a customer. Figuring, or Merely Quessing. We who are engaged in distributing seeds and other merchandise are too prone to feel that our expense items may be estimated, or guessed at, in- stead of being figiired down to a basis which may be depended upon to indi- cate the total cost of transacting the business. If we are to be successful in our busi- nesses, it will be necessary for us to conduct them on a scientific basis, or at least on a basis which will permit our knowing the exact relation of the expense items, when compared with the sales, of the year, month or day. In the general business world, only five per cent, of merchants who begin busi- ness on a certain date are still in b
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Keywords: ., bookcentury1900, bookdecad, booksubjectfloriculture, bookyear1912
