Analysis of General Ledger Edward P. Moxey

analysis of general ledger, 1919



temporary , permanent expenditures : cost accounting purposes, therefore, first distinction considering expenditures present must made between expenditures assets of more permanent type known fixed assets, , comprehended in term plant , of more or less temporary character, known profit , loss items, or comprehended in general class of nominal accounts.
classification of merchandising expenditures : following more detailed classification becomes desirable. taking merchandising concern sake of illustration, find profit , loss expenditure divided 2 parts, distinguishing feature being difference between payments dealt in, classified under heading merchandise, , payments services , other items necessary proper conduct of business, known general expense.

a further subdivision of general expense must made show items make total amount. 2 subheadings, known respectively trading expense , administrative expense, employed. former covers detailed expense accounts go make cost of distributing goods, including salesmen s salaries , expenses, rent of store in case of merchandising house, costs of advertising , of delivery service; while latter includes accounts show cost of managing financial , business affairs of concern, including administrative salaries , general office expense, such as, example, office supplies.

on other hand, merchandise, being entirely general in character, subdivided. first distinction made between purchases , sales. sales may divided classified sales accounts, while in division of purchases find first signs of detailed costs.