Edward P. Moxey

A 1904 article in the Bulletin of the American Institute of Banking reports, that under Moxey Jr., a class in bookkeeping was organized for those without previous experience.

Even in the college classroom, where text can readily be amplified by suggestions or criticisms of the instructor, the use of collateral references is well-nigh universal.

Furthermore, the interested student constantly desires to branch out and make a more intensive study of some topic, touched upon in a general treatise but in such a work necessarily given but scant attention.

Hatfield commented, that "if any criticism is to be made it might be that somewhat too much attention is given to details of forms, and too little emphasis is laid on the particular features which logically require differently ordered accounting systems.

[13] Charles Waldo Haskins had said: "The literature of accounting is virtually in its infancy, awaiting the fostering care of cultured authorship.

Although many valuable articles had been written on different phases of this subject, and while excellent books on costs had appeared from time to time, it was a notable fact that such articles and such books have been either of a highly technical character, or otherwise treating of special systems of costs as actually installed and used by certain manufacturing plants.

[13] As a result of this, according to Moxey, in his day there existed in many minds the idea that the principles of cost accounting were more or less mysterious and vague, and that the subject is one for the expert, only to be understood after years of study and experience.

They were used quite successfully in the early 1880s by Emile Garcke and John Manger Fells in their book "Factory Accounts"; but the idea had been further developed by Moxey, and had been made applicable to conditions of his day.

[14] A system of accounting, according to Moxey, should go beyond the elementary presentation of facts to furnish information sufficient and accurate enough for the requirements of modern business.

It is not right to charge the original cost of such purchases to profit and loss in the period in which they are made, for they will figure in the manufacture of hundreds of subsequent lots of goods.

In his Principles of Factory Cost Keeping (1913) Moxey proposes a system, which is based on the following basic distinctions:[15] A further subdivision of "General Expense" must then be made to show the items which make up its total amount.

[16] In order to understand the diagram and illustrate the operation of the books, it can be presumed that a certain sum of money is disbursed for the purchase of materials, labor, and other supplies and services connected with the production of the goods.

It is illustrated in the accompanying diagram, which shows the operation of a factory cost system from the time payment of cash is made to begin production until the goods have been completed and are available for sale.

At the bottom of the diagram Moxey noted, that the difference between the total Merchandise Orders appearing and the Debit side of the Trading Account and the Sales Invoices represents gross manufacturing profit.

[17] Moxey further explained that the manufacturer, who has his factory cost system arranged on this general plan is in a position enabling him to adjust his selling prices so as to bring to him the largest amount of profit.

[17] And furthermore Moxey explained, that "the factors which enter into the manufacturing cost of any product can be grouped under the main headings of "Stores", "Direct Labor", and "Indirect Expenses."

A man might register for an absent comrade, or he might record his own arrival and then take his departure from the plant by climbing over the back fence, returning by the same route at noon in order to pass out through the gate.

By this means he would receive credit for having worked a full half day, when as a matter of fact he had rendered no service whatever to his employer.

[18] In order to prevent such practices it was found necessary to employ departmental timekeepers, whose duty it was to make a tour of the plant to ascertain whether each man was at his appointed task.

It was soon recognized that a knowledge of the exact time spent by each man on a piece of work handled by him was not only desirable but necessary, in order to determine accurately the labor cost of each unit of product.

[5] Understandably, in 1924 William Duncan Gordon and Jeremiah Lockwood dedicated their Modern Accounting Systems to Edward P. Moxey Jr.[20] In his 1972 article, Adolph Matz summarized that Moxey's elementary work on cost accounting was taught at the university, and in Evening School, and was part of the State's C.P.A.

His work was taught over four decades, but after World War II the "new trends in teaching accounting and the move away from the practical approach led in the early 1950s to the discontinuation of the course.