direct and indirect expense to which the contractor is put in doing the work, after the contract is signed, is to be included in the cost all overhead expenses of every kind, plant deterioration, traveling expenses, supervision, and salaries, excepting only that the contractor himself is not entitled to any salary. In the case of a firm being the contractor, the head of that firm should receive no salary; but if any of the juniors devote their time exclusively to the job, it would be legitimate to allow them reasonable salaries, equivalent to what would have to be paid to regular assistants. All such matters, of course, should be stipulated in the contract.

In order to determine, after the entire job is finished, the amount due the contractor, "Sum C" is to be subtracted from "Sum D," and the ratio which this difference (either a positive or a negative quantity) bears to

"Sum C" is to be figured and adopted in the use of the diagram of "corrective ratios" (Fig. 33b*) for the said difference.

Application of Corrective Ratio. There are two reasons for applying this corrective ratio:

First. In the case where the actual quantities of materials exceed the

The solution of the difficulty is to substitute a broken line for each curve, passing through the known points at zero, five, ten, fifteen, and twenty percentages. The readings for these points on the upper line are zero, four, seven, nine, and ten; and on the lower line they are zero, one, three, six, and ten. Such an arrangement removes every possibility of dispute concerning the reading of the diagram, because all percentages intermediate to the above-mentioned ones can be directly interpolated.

* The curve in this diagram is intended to be the quadrant of a circle; hence, if in reading it there be any dispute between the accountants of the two parties, it can be settled by drawing the curve on cross-section paper using a large scale, or by employing exact mathematical formulae.