Expectations and Limitations of Activity Based Costing Application in Small and Medium Sized Enterprises PDF Download
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Author: Mirjana Todorovic
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
In present study we examine application of activity-based costing (ABC) in small and medium-sized enterprises (SMEs). We want to investigate circumstances which determine whether ABC will improve performance and competitiveness of the in small and medium-sized enterprises. The main objectives of our study are to determine effects (expectations) and limitations of the application of ABC in small and medium-sized enterprises. In addition to other factors, the expected benefits and potential limitations are the key factors of ABC future implementation, potential performances improvement and competitiveness of in small and medium-sized enterprises. The analysis is conducted on a sample of 33 enterprises in the small and medium-sized enterprises sector in Serbia. Study shows that the key benefits of ABC implementation are performances improvement and providing more accurate information. Also one of the most important obstacles to wider application of the ABC in the in small and medium-sized enterprises is the lack of professional knowledge and practical experience.
Author: Mirjana Todorovic
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
In present study we examine application of activity-based costing (ABC) in small and medium-sized enterprises (SMEs). We want to investigate circumstances which determine whether ABC will improve performance and competitiveness of the in small and medium-sized enterprises. The main objectives of our study are to determine effects (expectations) and limitations of the application of ABC in small and medium-sized enterprises. In addition to other factors, the expected benefits and potential limitations are the key factors of ABC future implementation, potential performances improvement and competitiveness of in small and medium-sized enterprises. The analysis is conducted on a sample of 33 enterprises in the small and medium-sized enterprises sector in Serbia. Study shows that the key benefits of ABC implementation are performances improvement and providing more accurate information. Also one of the most important obstacles to wider application of the ABC in the in small and medium-sized enterprises is the lack of professional knowledge and practical experience.
Author: Douglas T. Hicks
Publisher: John Wiley & Sons
ISBN:
Category : Business & Economics
Languages : en
Pages : 344
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Book Description
Activity-based costing (ABC) is a cost accounting concept that can be used by almost any corporation (manufacturing or service) to gain a competitive advantage through greater understanding of its product and process costs. This book shows how an organization can adopt ABC in a practical, cost-effective way without dismantling current cost information systems.
Author: Patrick Zeuner
Publisher: GRIN Verlag
ISBN: 3656202486
Category : Business & Economics
Languages : en
Pages : 41
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Book Description
Seminar paper from the year 2007 in the subject Business economics - Controlling, grade: 1,3, University of Applied Sciences Wildau (WIT Wildau), course: Managerial Accounting, 18 entries in the bibliography, language: English, abstract: Activity-based costing first gained publicity in the early 1980s. It was developed as a logical alternative to traditional cost management systems that tended to produce insufficient results when it came to allocating costs. Harvard Business School Professor Robert S. Kaplan was an early advocate of the ABC system. Due to a changing business world and strong competition, the cost structure in many companies changed, while facing an increased price pressure. When profit margins are decreasing, companies are focusing not only on external but also internal opportunities to improve their cost structures and to make hidden costs transparent. This lead to the introduction of Activity-based costing (ABC) as a new approach of process thinking to make the internal organization more flexible to react to changes in the production process and allocation of costs as well as to deal with overcapacities. This paper will focus on the ABC tool, which is aiming at transparency, efficiency increase and improvement of the given cost calculation systems. The ABC method enables management to optimize the enterprise with detailed information for a thorough decision making process. ABC is a method for developing cost estimates, based on the activities used within the production process per cost object. To develop a cost estimate the most important activities within the production cycle - the cost drivers - need to be identified. The activity must be definable and measured in units, e.g. number of man hours. After all activities for producing the product are known, a cost estimate is prepared for each activity. These individual cost estimates contain all labour, materials and equipment costs, including overhead, for each activity. Each complete individual e
Author: Michael Musov
Publisher:
ISBN:
Category :
Languages : en
Pages : 14
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Book Description
Despite the growing popularity of the Activity-Based Costing (ABC) approach over the last 30 years, its recent development - the Time-Driven Activity-Based Costing (TDABC) concept (Kaplan and Anderson, 2004) - remains largely unknown for the economic science and business practice in Central and Eastern Europe, Poland and Bulgaria included. This paper argues that this omission is a grave shortcoming, because, the extant research has suggested that TDABC has the potential to eliminate the main barriers to implementing, maintaining and modifying an ABC model at most organizations, especially at the small and medium-sized enterprises (SMEs). Specifically, two are the main arguments of the paper. First, implementing advanced costing systems such as TDABC in the SMEs in Poland and Bulgaria would have a greater impact on the general socioeconomic development than any improvements in managing costs of the large enterprises, because the SME sector plays a relatively more important role in these countries than large enterprises do. Second, TDABC is an appropriate costing approach for the SME sector in Poland and Bulgaria for the following reasons: (1) SMEs in the two countries seem to be relatively more labor-intensive; (2) TDABC models have the potential power to contribute to solving some of the most pressing problems of the Polish and Bulgarian SMEs; and (3) the TDABC approach - that engages relatively few resources, needs data about a relatively small pool of activities, and does not require continuous employee interviews and resurveys - seems to have greater potential for implementation at the SMEs than the traditional ABC approach has. The broad goal of the paper is to spark a renewed interest about the issues of strategic cost management at large. A more specific goal is to make this new concept popular in Central and Eastern Europe, which to enable its further theoretical development, as well as its practical implementation.
Author: Hakan Goektuerk
Publisher: GRIN Verlag
ISBN: 3638750833
Category : Business & Economics
Languages : en
Pages : 34
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Book Description
Seminar paper from the year 2005 in the subject Business economics - Accounting and Taxes, grade: 1,6, Lancaster University, course: Management Accounting, 10 entries in the bibliography, language: English, abstract: In this report I will show how activity-based costing (ABC) can be applied to a department of a major institution such as a University. Large universities may maintain and follow complex and rigid accounting systems. However, the systems are almost always based on a form of fund accounting and are intended to satisfy legal and donor stipulations rather than to provide information for administrative decisions. In this report I show how activity-based costing (ABC) can be applied to institutions of higher education and, I believe, can result in improved information of benefit to academic administrators, legislators, voters and consumers. The report also analyses an example related to the degree at the university which follows with the appropriateness of using this system by the university. The Advantages and Disadvantages of activity-based costing are also investigated in this report and therefore, will provide a disclosure for the University board in terms of the usage of ABC.
Author: David Wagener
Publisher: GRIN Verlag
ISBN: 364058662X
Category : Business & Economics
Languages : en
Pages : 33
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Book Description
Seminar paper from the year 2008 in the subject Business economics - Accounting and Taxes, grade: 1.3, University of the West of England, Bristol (Bristol Business School (University of the West of England)), course: Internes Rechnungswesen/ Management Accounting, 15 entries in the bibliography, language: English, abstract: Every accounting student of the past sixty years has learned about inventory costing- a bookkeeping procedure that manufacturing accountants follow to separate the production expense of an accounting period from the cost of manufactured product inventories at the end of the period. (Johnson and Kaplan, 1991, p. 130) This technique of valuing inventory should, although often practiced, not be used for managerial decision making though. It oversimplifies the consumption of overhead costs by products, services and customers and therefore leads to distorted cost information. Activity-based costing (ABC), developed by single manufacturing firms in the early 1980s, seems to provide more reliable information. The second part of this work describes the concept of ABC by summarizing the arguments of two pioneers in this field. In their book "Relevance Lost: The Rise and Fall of Management Accounting", first published in 1987, H. Thomas Johnson and Robert S. Kaplan (1991) examine the traditions of management accountting and describe possible improvements. In part three the developments of ABC in the last 20 years are described by reviewing a choice of important literature. Part four then shows the impact that ABC had on implementing companies. The conclusion, part five, contains an assessment of the used literature and an evaluation of whether the critic of traditional management accounting has been overcome by ABC.
Author: Patrick Zeuner
Publisher: GRIN Verlag
ISBN: 3638056767
Category : Business & Economics
Languages : en
Pages : 19
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Book Description
Seminar paper from the year 2007 in the subject Business economics - Controlling, grade: 1,3, University of Applied Sciences Wildau (WIT Wildau), course: Managerial Accounting, language: English, abstract: Activity-based costing first gained publicity in the early 1980s. It was developed as a logical alternative to traditional cost management systems that tended to produce insufficient results when it came to allocating costs. Harvard Business School Professor Robert S. Kaplan was an early advocate of the ABC system. Due to a changing business world and strong competition, the cost structure in many companies changed, while facing an increased price pressure. When profit margins are decreasing, companies are focusing not only on external but also internal opportunities to improve their cost structures and to make hidden costs transparent. This lead to the introduction of Activity-based costing (ABC) as a new approach of process thinking to make the internal organization more flexible to react to changes in the production process and allocation of costs as well as to deal with overcapacities. This paper will focus on the ABC tool, which is aiming at transparency, efficiency increase and improvement of the given cost calculation systems. The ABC method enables management to optimize the enterprise with detailed information for a thorough decision making process. ABC is a method for developing cost estimates, based on the activities used within the production process per cost object. To develop a cost estimate the most important activities within the production cycle – the cost drivers - need to be identified. The activity must be definable and measured in units, e.g. number of man hours. After all activities for producing the product are known, a cost estimate is prepared for each activity. These individual cost estimates contain all labour, materials and equipment costs, including overhead, for each activity. Each complete individual estimate is added to the others to obtain an overall estimate. To gain sufficient cost estimates, data must be collected and verified to make ABC a functional and precise tool. This chapter leads through the necessary steps to implement the ABC approach and its methodology.
Author: Mürühan Arifoğlu
Publisher:
ISBN:
Category : Activity-based costing
Languages : en
Pages : 122
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Book Description
Author: Marvin Buskase
Publisher: GRIN Verlag
ISBN: 3346783731
Category : Business & Economics
Languages : de
Pages : 22
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Book Description
Studienarbeit aus dem Jahr 2019 im Fachbereich BWL - Controlling, Note: 1,7, Universität Osnabrück, Sprache: Deutsch, Abstract: Activity-based costing (ABC) is one of the most recent achievements of modern accounting theory. Therefore it has not been researched on immediately through the 1980s and 1990s. There also have been several problems with the implementation of ABC. The methodology of ABC evolved to be applicable more efficiently and flexible. Given that information, nowadays we come to the question, what kind of development ABC went through and which benefits are coming alongside to those recent changes. The intention is to give the reader an overview about ABC as a new costing system in general, to understand the methodology behind ABC and to give a basis for a discussion on the latest changes of its systematics. One of the most recent tidings, when it comes to the methodology of ABC, is the Time-Driven ABC (TDABC) by Kaplan and Anderson (2007). This new systematic shall also be researched more-over in this work, to analyze and compare its applicability to the early ABC system. This will hopefully create a basis for additional critical discussions on this topic. The remainder of this paper is organized as follows. In the next chapter the reader will be given a basic understanding of how ABC works in general and in comparison to other “traditional” accounting methods. Afterwards there will be an analysis on the survey “[...] of Activity-Based Costing in the U.K.’s largest Companies” made by J. Innes and F. Mitchell in 1994. The Analysis will focus on outlining the results to create a frame for the beginning of the application of ABC. Having that frame there will be a short discussion to ensure a comparison to the state of the art. The fourth chapter will outline that state of the art. It will depict the development of the adoption and the areas which ABC has been used for and brief the reader about the TDABC. The last chapter will on the one side conclude the results of this work and on the other side it will depict the potential of future research.
Author: Peter B. B. Turney
Publisher:
ISBN:
Category : Business & Economics
Languages : en
Pages : 346
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Book Description
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