Study Of Cost Management System In Coal Enterprise Based On ABC

The rapid development and wide use of global advanced manufacturing technology has brought sharp decreases in direct expense as well as shocking increases in indirect expenses. Thus, it challenges traditional costing and cost management, and accordingly Activity-based costing comes in. Activity-based costing, short for ABC, overcomes traditional costing' s the distortion of cost, and provides precise and decision-making related information. The paper puts forward operational and strategic ABM (Activity-based cost management) from both micro and macro points of view, based on ABC theory and comprehensive understanding of specific situation in coal enterprises, related industry environment and competition in outside market; it also introduces a performance appraisal system of cost management grounded on the theory of Balance Score Card.The paper has seven parts. The ground, significance, major research contents and methods are introduced in Parti; In Part2, based on Turney' s two-view model, major theories and definitions of ABC are introduced, which pave the way for the theoretical basis of the whole paper; The preliminary work of ABM is clarified in Part3, which includes how to determine the scope of activity-based analysis, activity-based analysis unit, and aggregation and decomposition of activities; The following Part4 and Part5, as the core of whole paper, introduce operational and strategic ABM in detail. Operational ABM has centered on activity-based analysis in order to appraise the effectiveness and value-creating ability of specific activity, in which an activity-based cost pool and a resource pool are established for coal enterprises, and an activity improvement is carried out in a case study. Strategic ABM is composed of value & activity chain analysis, strategic decision-making and cost driver analysis, in which a great emphasis is put on a ABM-based decision making process for such activity units as sourcing and selling. In a case, the way to sensibly choose providers and keep sound relationships with them has been profoundly brought up, and a customer cost-benefit model is introduced for customer management; In Part6, a performance appraisal system of cost management for coal enterprises is established grounded on the structure of BSC; The last part gives a brief conclusion to the whole paper, and some shortcomings are pointed out for further study. Also, a prospect for the application of this system in coal enterprises is put forward.