One of the expensive drawbacks of the older practice of building an entire machine in one department, and another machine of different type or size in another department, rather than to so divide the work as to have the department equipped with machines of one type (as planers) and the next with another type (as lathes) and so on, is that while one department will be crowded with one class of work, say planer work, the next one will have their planers idle and the lathes will be crowded. The author remembers one shop arranged after these ancient ideas in which, by actual count, nearly two thirds of all the machines of the plant were idle at a time, and largely owing to the above causes, thereby throwing on each machine in use the expense burden belonging to three machines. This meant that the shop in general was equipped with about three times the number of machines necessary to do the required work by a modern organization plan, and therefore lost that much money unnecessarily.

By our plan all the machines of a class or type are located in one department, and the departments so arranged that in the natural succession of operations the work passes from the first department to the adjoining one whenever possible, and so continues until completed. Thus we get the maximum of continuous service from the smallest number of machines and have very few idle ones, consequently the minimum burden of this character.

By our plan of accounting for the cost of a given job we find it made up of five separate factors or charges, brought together by the cost clerk. These are: first, the cost of direct labor; second, the cost of material; third, the fixed charges; fourth, the expense burden on the machines used; and fifth, a due proportion of extra burden on account of idle machines.

The drawing room and pattern shop expenses require special notice. In the usual discussion of shop costs perhaps they have not had a fair share of attention. It often happens that both drawings and patterns are directly chargeable to certain jobs as are of special nature. In calculating these charges we go about it in the same general manner as in ascertaining the cost of jobs in the machine shop proper. That is, charging for time occupied, material used, and to this is added a burden of fixed charges and an expense burden consisting of its proper proportion of the cost of non-productive labor, lighting, heating, ventilating, and cleaning, which, in the drawing room, will be assessed by the total area of floor surface occupied by this department divided by the number of men employed, to ascertain the burden rate per man, which is to be added to the time and material cost.

In the pattern shop the same method is used for men whose work does not require the use of a machine. For those who work continuously at a machine the same method as employed in the machine shop will be used, the machine having a regular rating. Frequently the machines are used only for a fraction of an hour at a time, and the cost is hardly worth the time it will take to ascertain it. This charge will naturally fall into the fifth factor of cost.

Under other circumstances both drawings and patterns are required for the regular output of machines or other articles manufactured. While these might in many instances relate only to a certain size or type of machine to be built, it would seem quite evident that the expense should be added to the fixed burden, for the same reason that we charge office furniture or shop fixtures, they becoming an asset of the establishment.

One of the machine shop departments about whose expense there seems to be much diversity of opinion is the tool room. It is liable to be employed on quite a variety of work, sometimes on orders for product to be sold, but more often for the making or repairing of tools, jigs, and fixtures for use on the machines in the manufacturing departments of the machine shop. When at work on regular orders, or any part of them, the charge will be the same as if the work were done in the machine shop proper, the machines in use here being rated in the same manner.

It is also clear that in making or grinding tools for lathe and planer work, cutters for milling and gear cutting, etc., and for making, altering, or repairing jigs and fixtures, we are adding so much to the equipment and its usefulness, and the expense should be borne by the machines in the machine shop on which they are used. Therefore it would seem proper that a percentage on first cost and for depreciation should be added in with the fourth charge in calculating the cost of a job. Of course this charge should only apply to the machine shop proper and the burden not carried to the accounts of other departments outside of it. It may be noted that the handling of the tool room accounts should be done cautiously, as a careless apportioning of the costs may lead to very serious errors.

The burden of idle machines in the tool room must be borne by the fifth factor in our cost account, for the reason that they are engaged either directly or indirectly in the production of the articles to be sold, the manufacture of which requires the use of the tools and appliances here made and maintained in useful condition.

Consumable tools and supplies such as files, waste, oil, etc., used on machines, drawn for use in the machine shop proper, will be classed as a part of the fourth factor of cost. This will not include waste and oil issued to the power plant, although the costs eventually find their way into the same group of charges.