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PROBLEMS OF THE HAULIER AND CARRIER.

30th March 1926, Page 31
30th March 1926
Page 31
Page 32
Page 31, 30th March 1926 — PROBLEMS OF THE HAULIER AND CARRIER.
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Which of the following most accurately describes the problem?

A Simple Method of Book-keeping Embracing all the Various Items which Form Operating Costs.

B00K-KEEPING has charms for the comparatively few, and he is .a freak (at least, so I think) who would describe it as an enthralling kind of job. Although the double-entry system really does not involve such a terrible task as might appear, many hauliers and carriers in a small way of business find it rather bewildering, and, in consequence, they often omit to keep any books at all. Obviously, this is bad policy, and many commercial motor users realize the fact, as they write to me in numbers wanting to know how to record operating costs without having to acquire a professional book-keeping knowledge.

Naturally, I believe in complete accountancy whenever it can be Afforded, but to comply with the requests referred to I propose dealing with the matter this week, outlining a very elementary system which, although it is really quite simple, does show all the outgoings for any particular period so long as the entries are kept up to date, which, of course, applies to any accounting schen)°, as the entries will not, in any circumstances, record themselves I Readers will remember that I described a simple method of filing bills and expense chits in The Commercial Motor of January 19th. The apparatus involved In the scheme consists of a box having nails projecting inside it, on which the bills are filed according to their nature. Every item of revenue or expense should be entered in the " cash-book " as and when received or incurred, and from this, supported by the bills and papers from the voucher box, entries are made in the ledger, or whatever takes its place, as and when opportunity arises. We may now start from this point to discuss methods of actual book-keeping, and it is presumed that the haulier or carrier has his bills filed under each of the ten headings which go to comprise operating costs.

The first thing is the books themselves. There is no need even to go in for bound ledgers, dny-books, or journals for keeping track of vehicle operating costs, if it is desired to save their cost. Quite good enough for the job are cheap books (" ruled cash "), bound in fairly stout• board (paper-backed ones 50013 become absolute scrap when lying about in the average office, where such luxuries as filing cabinets and bookshelves are almost non-existent). A handy size of book is about 61. ins, wide by 81 ins, deep, with a date column, I large column for the description of the items, and the three cash columns on each page. Be sure to buy ready-ruled books, as the bother of ruling by hand is very considerable.

Each book is for one vehicle and should be labelled on the cover with as many details of the machine to which it relates as the owner thinks tit. At any rate, the make and o number or fleet number will be wanted. Such items as chassis and engine numbers, tyre sizes, driver's name, etc., are useful for reference purposes. Although they are, perhaps, in the nature of "frills," it may be remembered that a glance at a fully detailed label may save quite a lot of time in such a case as the proprietor sending out an order for spares and wanting to know the chassis number when the lorry is away for a couple of days. The cost of a ruled book of the right kind is about 6c1., and it should last a couple of years. Surely nobody can say that ad. a year per vehicle for books is really dear !

The Headings in the Costs Book.

Now, having got the book—we will presume a onevehicle business to simplify the explanation—and labelled it, the next thing is to space out its pages conveniently, putting the headings at suitable intervals, so that, for example, we do not have a dozen waste pages at the end of " Fuel " and find that we are a page short at the end a "Wages." A weekly total of expenditure is usually wanted, so we shall have to allow for 52 entries as a minimum under each of the headings.

For those who do not feel the need for summarizing the position at such frequent intervals, they may, of course, have monthly or other totals as they think lit; but, as I have pointed out many times before, a proper summary of affairs at regular and frequent intervals is a great assistance towards preventing loss and waste.

In the case of such a thing as fuel, it must not be thought that expense is the only item which really needs to be recorded, and points such as this will be dealt with one by one in succeeding paragraphs. The number of entries obviously contrqls the space required by each section, and one can easily work out the number of times that the tank is filled per week—for example, in connection with the fuel section. Sufficient pages must be allowed to take the entries for 52 weeks. There will also he 52 lines for totals and a little space to spare as a margin.

Before considering items which affect the spacing of the headings we must remember the headings Ahemselves, which are :—Fuel, lubricants, tyres, maintenance, depreciation, licences, wages, rent and rates for garage, insurance and loss of interest on capital.

A little has already been said about fuel entries so far as the cash is concerned; there is another side of the question to be thought of, and that concerns mileage in relation to fuel used. For this purpose it is a good plan to use two opposite pages together, the right-hand one being for cash and quantities, the left-hand one for mileages and weekly consumption results. In this way the entries will be opposite each other, so that the weekly expenditure and the weekly consumption can be read at a glance and a line carried right across both pages to rule off at the end of the record for each week. When this course is to be followed, and one is calculating space, a left and right-hand page together count as one, not two.

Recording Consumption and Mileage.

Bills are entered up—or the equivalent prices for any amounts of fuel put into the tank during the week— on the right-hand page, and on the left-hand side are recorded the milometer readings at the beginning and end of each week. The cash columns on the extreme right are totalled, also the number of gallons on the left; the miles covered are found by subtraction and written down. The mileage per gallon is calculated, using the total number of gallons which are to be found on the right-hand side of the page, making due allowance for the quantity left in the tank, and carrying that forward as a debit to the next week's work.

Expenditure and consumption of lubricants are dealt with in just the same way; that is, two facing pages are used together, thus tallying not only cost, but consumption, which acts as an efficient check upon waste, and, in many cases, gives indication of engine trouble. Tyres are bought only at rare intervals, therefore the entries will be few and far between. Maintenance also involves only occasional entries.

Depreciation has to be entered up weekly to-get the proper results, but only one page need be used. The cost per mile must be decided upon, and all that has to be done is to enter up, each Saturday, for instance, the weekly cost, which is found by multiplying the miles covered during the week by the selected allowance figure. One line will suffice for each week, as all that has to be done is to put, for example, "200 miles at id. – 16s. 8d." This completes the running costs.

Turning to the standing charges, licences cost each week one-fifty-second of the yearly total, which, of course, is known in advance; therefore; one line per week is all that is needed when spacing out, not forgetting the line for yearly total. Wages, too, in most cases, can be entered on one line a week, also rent and rates for the garage are known in advance, and entries can, therefore, be made definitely, again allowing one line a week. Insurance and loss of interest on capital can be dealt with exactly in the same way.

Now we can proceed to space out the book and write in the headings. Leave the first page clear for details of the vehicle concerned, but head the second page on the right-hand side, and, if you like, the left, "Fuel.'" Work out the desirable space for fuel accounts on the basis mentioned, remembering to count both left and right-hand pages as one, as they are used together in recording items for the same week.. This will, of course, give double the space that is required for the actual cash entries. Leave a little extra for a margin, and then head another right-hand page "Lubricants" (here, again, left and right-hand pages are used together).

Carrying on, .we wake the "Tyres" heading, allowing 52 lines, or we had better say 60, for sarety, where weekly totals are to be compiled. More space is desirable for maintenance, as some of the entries may be rather long if full records are to be kept. If, however, reference be made to bills only and amounts are put down, say, "Voucher 412, £12 8s. 6d.," 60 lines should be enough. The same space is needed for depreciation, as the item consists merely of so many miles, multiplied by the selected allowance figure.

All the standing charges are known in advance and have no relation to the Mileage; therefore the proper entry in respect of each may be made every Saturday morning, and every section will occupy, say, 60 lines apiece; that is giving plenty of space for totals and so forth. If, however, accounts are only attended to monthly, the space may be reduced accordingly.

Having spaced your book and made the necessary headings, use it S.T.R.

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