1、1915 单词，中文 3109 字 1 外文翻译 原文 Application of Activity-Based Costing in a Manufacturing Company: A Comparison with Traditional Costing Material Source: Department of Industrial Engineering, University of DokuzEylul, Turkey Author: GoncaTuncel, DeryaErenAkyol, GunhanMiracBayhan, UtkuKo
2、ker Abstract: Activity-Based Costing (ABC) represents an alternative paradigm to traditional cost accounting system and has received extensive attention during the past decade. Rather than distorting the cost information by using traditional overhead allocation methods, it traces the cost via
3、activities performed on the cost objects (production or service activities) giving more accurate and traceable cost information. In this paper, the implementation of ABC in a manufacturing system is presented, and a comparison with the traditional cost based system in terms of the effects on the pro
4、duct costs is carried out to highlight the difference between two costing methodologies. The results of the application reveal the weak points of traditional costing methods and an S-Curve which exposes the undercosted and overcosted products is used to improve the product pricing policy of the firm
5、. 1 Introduction The customer driven environment of todays manufacturing systems and the competitive pressure of the global economy force manufacturing services and organizations to become more flexible, integrated and highly automated in order to increase their productivity at reduced c
6、osts. But it is impossible to sustain competitiveness without an accurate cost calculation mechanism. Proposed by, as an alternative method to traditional cost accounting methods, ABC assigns costs to activities using multiple cost drivers, and then allocates costs to products based on each products
7、 use of these activities. Using multiple activities as cost drivers, it reduces the risk of distortion and provides accurate cost information. In an ABC system, the total cost of a product equals the cost of the raw materials plus the sum of the cost of all value adding activities to produce i
8、t. In other words, the ABC method models the usage of the organization resources by the 2 activities performed and links the cost of these activities to outputs, such as products, customers, and services. Each product requires a number of activities such as design, engineering, purchasing, productio
9、n and quality control. Each activity consumes resources of different categories such as the working time of the manager. Cost drivers are often measures of the activities performed such as number of units produced, labor hours, hours of equipment time, number of orders received. In traditional
10、 cost accounting systems, direct materials and labor are the only costs that can be traced directly to the product. By using the ABC system, activities can be classified as value-added and non-value-added activities. In order to improve the performance of the system, non-value-added can be eliminate
11、d. Despite the advantages of providing accurate costs, it requires additional effort and expense in obtaining the information needed for the analysis. However, a proper design tool can help to reduce time used for modeling and overcome the difficulties present in designing a cost model.
12、The primary objective of this paper is to develop an ABC system for a sanitary-ware company and to compare the results of ABC with traditional costing methods. In other words, the aim of ABC analysis is to guide improvement efforts of management in the right direction by providing accurate informati
13、on about activities. The organization of the paper is as follows: In section 2, the methodology of ABC is explained. A case study is presented in section 3 to illustrate the application of ABC in a company. Finally, in section 4, the conclusions and the future research directions are given. So
14、me suggestions are offered to improve the performance of the company. 2 Activity-Based Costing (ABC) ABC is an economic model that identifies the cost pools or activity centers in an organization and assigns costs to cost drivers based on the number of each activity used. Since the cost
15、drivers are related to the activities, they occur on several levels: (1) Unit level drivers which assume the increase of the inputs for every unit that is being produced. (2) Batch level drivers which assume the variation of the inputs for every batch that is being produced. (3) Pr
16、oduct level drivers which assume the necessity of the inputs to support the production of each different type of product. 3 (4) Facility level drivers are the drivers which are related to the facilitys manufacturing process. Users of the ABC system will need to identify the activities which ge
17、nerate cost and then match the activities to the level bases used to assign costs to the products. While using the ABC system, the activities which generate cost must be determined and then should be matched to the level drivers used to assign costs to the products. The implementation of the A
18、BC system has the following steps: (1) Identifying the activities such as engineering, machining. (2) Determining the activity costs. (3) Determining the cost drivers such as machining hours, number of setups and engineering hours. (4) Collecting the activity data. (5)
19、Computing the product cost. 3 Implementation of the ABC Method: A Case Study The implementation study presented here took place in one of the leading sanitary ware companies in Turkey 7. It has a production capacity of 6.8 thousand tons. Like many sanitary ware manufacturers, the company
20、 includes some common processes. First stage of the processes is done in the bulk-preparement department which is in charge of preparing the essential quantities of bulk bearing. Recipes are prepared for each production run and according to these ingredient recipes, the bulks are prepared by the ele
21、ctronically controlled tanks. After the bulk is ready, it can be sent to two different departments, pressured and classical casting departments. In pressured casting department, the bulk is given shape by the pressured casting process. The process uses automated machines and has shorter cycle
22、times when compared to classical casting department. However, the bulk used in this department must have the characteristics of strength and endurance. The output of this department is sent to glazing department. Classical casting is the second alternative to produce sanitary ware products. In
23、 this department, most of the operations are performed by direct labor. The cycle times of the products are longer than the pressured casting department. The output of this department is shaped and casted bulk and sent to the glazing department, too. In glazing department, shaped bulk is glaze
24、d. This stage can be defined as polishing the products with a protective material from external effects. The output of this department is sent to tunnel oven. In tunnel oven, the products are heated over 1200 degrees Celsius. After staying in theses ovens for a period of time, the products are
25、 inspected by the workers. However, some of the output may have some undesired characteristics like the scratches, etc. In this case, these products are sent to the second heat treatment where they are reworked and heated again. The proper output is sent to packaging while the defected ones are sent
26、 to waste. Finally, in packaging department, products are packaged and shrunken. Company has been using a process costing logic for obtaining the proper costing of its products. Process costing is also a widely used costing tool for many companies. This method recognizes the following cost poo
27、ls: Direct Labor: All workers taking place in the production are recognized as direct labor and this pool is the most common pool used in every stage. LPG-Electricity hot water: These items are important costing element in casting departments. Packaging: This cost is observed in th
28、e final stage of the firm called final packaging. It includes packaging and shrinking of the products. Overheads: This is also common cost pool for all the stages in the firm. It includes depreciation, rents, indirect labor, materials, and miscellaneous costs. In order to perform ABC cal
29、culations, process costing sheets are used. Because process costing aggregates the cost in the case of more than one product, it is difficult to obtain the correct results. The correct results with process costing can only be achieved when there is a single homogenous product. After analyzing the ou
30、tput of bulk preparement department, it is seen that bulk prepared for the two departments are the same which brings an opportunity for the analysis. Firstly, time sheets are prepared to learn how much of the labor time is used to perform the relevant activities. Workers filled the time sheet
31、and as a result, the activity knowledge of the processes and related percentage times are obtained. The time sheets are edited and necessary corrections are made. While some of the activities are merged, some of them are discarded. After this stage, the wage data is requested from the accounting department and labor cost of the activities are determined.
