Lean Accounting article from SME

Keeping score with lean accounting cost management [the broken link was removed] by Jerry Solomon:

We changed the format of our income statements. We made them simple. For each value stream, all of the payroll expense is in one bucket called processing costs. There is another bucket for all of our variable costs. We exclude elements outside the value stream, like property taxes or insurance.

Now the income statements allow the folks to clearly see and understand what was spent on labor, how many units were produced, and the labor cost per unit. It’s pretty easy.