fllochine Accounting Reduces Deoler's Overheod

By Clarence A. Thompson, Chairman, Lumber Dealers Research Council

During the last 14 months our yards at Champaign and Decatur, Illinois, have brought automation to part of our office procedures. We made this step by replacing the con- ', ventional post-binder ledger and journal records comprising ' the general accounting records with modern records maintained on IBM punch-card equipment. We now forward all ' original accounting data to Mid-States Business Service, ' who have made a specialty of punch-card accounting. When ' we began utilizing the Mid-States Service, accounting jourr nals were printed and a trial balance prepared from which monthlv statements were tvoed. However. we now have compleie financial statementsincluding budget comparisons prepared automatically at high speed by machine.

The accounting data we furnish to Mid-States comes from three basic sources:

/ mailed to vendors at the end of the month. This accounts payable entry is then reversed at the end of the subsequent month. Handling accounts.payable in this manner eliminates the necessity of maintaining detailed accounts-payable ledgers rvhile at the same time retaining, through the filing of a copy of the voucher by vendor, a complete record of all purchases for inventory and expense

The voucher-check copies, daily check-out sheets and the journal-register sheets are forwarded to Mid-States twice monthly. Since all reports are prepared completely by machine we have had complete financial statements returned to us two days from the time the final information was mailed to Mid-States. In addition, we receive machine listing which show in detail the entries affecting each account. The detail listings show date of the transaction, check number, payee or other description, account number and amount. We file the monthly journals by account number and consequently have an up to date analysis of each account at all times.

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1. A voucher check which combines both check and remittance advice.

2. A daily check-out sheet which covers sales, accounts receivable transactions and cash paid-outs.

3. A journal register on which journal entries are listed for each month.

. The voucher check, a triplicate form, is prepared at the time the invoice is received and the section showing account distribution completed. These unsigned checks, which serve as the account payable records, are filed by discount date. At the time the check is mailed, the second copy is filed by vendor and the third copy held for Mid-States.

, A daily check-out sheet varies with the type of yard operation depending upon type of sales breakdown required, number of selling points, etc. ,It contains sales totals, accounts receivable charges and collections, bank deposits, and cash paid-outs. In our application we merely list the various daily totals showing account numbers affected.

Journal entries are entered on the journal register at the end of each month. Depreciation expense, insurance writeoffs and tax accruals, together with accounts-payable accruals, comprise the greater part of these entries. These adjustments change the accounts from cash to accrual ba3is. The accounts-payable entry is computed by running adding machine tapes of the voucher checks, which had not been

We have eliminated the possibility of error in mechanical entry to journals since the initial recording of the transaction in the IBM card is verified. In order to insure overall accuracy Mid-States requires that we forward each month reconciled bank balances and totals of accounts receivable which are checked with journal listings.

Elimination of hand-written records and the resultfurg reduction in personnel expense is the tangible advantage of this system. Although it is.still possible to find a person capable of serving asi a general ledger bookkeeper, the market for this type of employee is rapidly diminishing. However, having finished financial statements within the first ten days of the month enables us to use the reports as a management tool rather than a historical record. This is invaluable.

This system, which we developed with Mid-States, is an excellent service which can be used successfully by any yard in the Mid-West area. Actually, it can be used by a yard in any part of the country, but far-distant points would receive reports a day or two later because of mail service. We endorse it not only for its technical accounting advantages but, more important, because we save money by reduction of overhead. To take advantage of this, write directly to Mid-States Business Service, Box 162, Danville, Illinois, attention : Robert Cartee, President.

SCRLA Plons lts Busiest, Xlost Stimuloting Conference fol Retoil Members of Sontq Bqrborq Biltmore, October 2-4

Deolers Pick Their Own fopics for rhe Lively Group Discussions

One of the most stimulating discussion programs ever planned for retail lumber dealers is that now being put together by Executive Vice-President Orrie W. Hamilton and President Hal A. Brown for the eighth annual Conference of the Southern California Retail Lumber Association. The meeting for owners and principals of retail lumberyards will be held in Santa Barbara this year. The dates are October 2,3 and 4, and the place is the Santa Barbara Biltmore hotel.

The topics to be tossed to the Conference this fall are the result of a questionnaire which was sent to all SCRLA dealer members by Mr. Hamilton during this summer. They include:

"Pricing for Profit from Walk-in Trade," a Panel discussion to include Robert M. Sutton, Airline Lumber Co.; Terry Mullin, Tarzana Lumber Co. and Terry Lumber Co. of ttie Mullin line; E. G. Ludwick, Santa Birbara Mill & Luniber Co., and L. E. Van Order, Blue Star Lumber Co.;

"Cost of Selling Small Orders," to be presented by William G. Cooper, manager of the W. E. Cooper Lumber Co.;

"Cost of Operating Retail Yards in Southern California," by Ralph N. Baker, Barr Lumber Co.;

"Credits, Collections and Cash Discounts," a Panel discussion to be moderated by Ralph Hill, Owens-Parks Lumber Co.; Ralph Russell, Consolidated Lumber Co.; Bill Richards, Lounsberry & Harris, and George Miller, Sun Lumber Co.;

"Catering to the Cash-and-Carry Trade," by Norbert Bundschuh, Myrtle Avenue Lumber Co.;

"Mechanics Lien and Usury Law," by Leo G. Hubbard, Hayward Lumber & Investment Co.;

"Our Training Program," by Bob Leishman, Crown City Lumber & Mill Co., with color slides;

"Self-Service," by Stanley E. Brown, Chandler Lumber Co.;

"What. Whv and How-Do-You Do for Brown, Woodiead Lumber Co.; by Hal

"Costs fncurred When Furnishing Straight Grades of Common Lumber," by Homer Burnaby, Sun Lumber Co., and

"Store and Yard Arrangement," a color-slide program

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