Reviews the book "Accounting II," by Leo A. Schmidt.

The article discusses cost accounting for motor freight terminals. It is essential to the efficient operation of a motor freight terminal that management knows the cost of handling each shipment. Shipments may be divided into certain official freight classifications. In the strictly line haul operation no consideration was given to weight groups, because the cost of hauling a given load of ten shipments was the same as the cost of hauling one shipment of ten pieces, if all other things were the same. The same general outline used to develop line haul cost methods is employed to develop terminal cost, but pick-up and delivery, assembling, segregating, billing and loading freight at a terminal, involve many additional complications. In order to distribute the pick-up expenses, it is necessary to list those expenses, which are computed on a mileage basis separately from those, which are not affected, by the number of miles the truck operates. It is customary in motor transportation cost studies to divide shipments into certain weight groups, which conform to the weight groups of the tariff for the area and commodities or classes of property covered by the study.

The accepted principles of cost accounting may be applied to the transportation of property by motor trucks in such manner that the cost of hauling each class will be determined. At the present time motor freight carriers, both common and contract, are required by governmental regulatory commissions to maintain uniform systems of accounts and to submit annual reports. While these accounts are very detailed with minute divisions and subdivisions of both revenue and expense, they do not reveal the cost of transporting property, because there is no method of apportioning or allocating the expenses to the particular service being rendered. The statement of profit and loss by classes is only tentative, because there are many other relevant factors to be considered. The percentages of load will vary. Also, the percentages of expenses to be assigned to the various classes will change. However, when a sufficient number of actual studies have been made to supply factual data, standard percentages can be determined. When these standard percentages are applied to expenses, the cost of transporting merchandise over a line haul can be established.