On Activity-Based Costing And Its Application

Since the 1980s, with the market competition and the information technology fast developing, the production technology and the management methods having had the huge transformation, it emerges much new management thought and the management methods. The modern enterprise essentially becomes the work collectivity to satisfy a series of need which the customer needs, and the enterprise activities become "the activity chain" from one to other and from inside to outside. From the process angle understanding cost and the activity relations, is advantageous to the calculation and the management. The Activity-Based Costing is precisely in such rationale, to create the comprehensive research to study traditional method which distorts the product actual cost by using the direct man-power and so on as the expense assignment standard to compute production cost.This thesis is beginning with the conception of ABC, expounds the result of the ABC researching in modern theory fields, and then studies the case of using ABC in Yu Long co. Ltd. This thesis embarks from Yu Long co. Ltd itself, introduces company situation, from the organizational structure, production route and the production process. Then it expounds the company tradition cost accounting method and the existence question, considers using Activity-Based Costing as the calculation management. It designs Activity-Based Costing system in the view of Yu Long co. Ltd activity chain constitution, calculates one order cost and compare with the traditional cost, then summarizes the Activity-Based Costing can bring progress for Yu Long co. Ltd in the present stage, put forward some management suggestion.Yu Long co. Ltd utilizes Activity-Based Costing not only reconfirming the majority of products cost, but also carrying on the brand-new appraisal to enterprise activity flow, which guides the enterprise to discover its own improving direction to guarantee Yu Long co. Ltd growing trend. The thesis proves Activity-Based Costing can apply to the agricultural products processing enterprises. Activity-Based Costing theory from manufacture enterprise is suitable for the company like Yu Long co. Ltd.It is not long time since ABC development in China, and the number of enterprise using it is less. Although the need of ABC in enterprises is great, the realization and practice are not enough. So it is very hard to research it in this thesis. But I believe that if we continue thinking and exploring, we would be in great effect.