The Application Of Activity-based Costing In Higher Education Cost Accounting

With the deepening of China’s social reform, higher education as an importantcomponent of its will also face unprecedented challenges, especially in the resources arelow and need to be in a competition environment to improve the quantity and quality of theeducation，these makes our country’s Higher Education Institutions (HEIs) could experiencesuch as the plight of manufacturing industry the same. The manufacturing industry useadvanced techniques and tools, such as activity-based costing (ABC), business processreengineering, concurrent engineering, total quality management (TQM), which allowsmanufacturers to better understand the product cost, optimize the production process,eliminate waste, reduce the cost and improving the quality of the added value, and finallycustomer satisfaction and loyalty. The activity-based costing used successfully inmanufacturing and services, this is a good revelation for Chinese HEIs to establish of theuniversity cost management mechanism, because HEIs is an serving systems.The Activity-based Costing alter the understand for Costing connotation, because thedifferent analyze, and It provides information that can help to track the number needed foreach activity or frequency of activities, and create a line and effective cost managementsystem. This study build an activity-based costing model is used to calculate a universitystudents average education cost. Its specific contents: First, Review of Cost ManagementLiterature for Chinese HEIs and the activity-based costing Literature at home and abroad.Second, Create the activity-based costing conceptual model and data model for colleges anduniversities, an collect comprehensive data about Financial Dept., Executive branch, Driver,etc. Next, The data were classified and finishing, obtained each cost object of costs. Finally,compare the results and application of traditional cost method, the calculated results ABCfound application to obtain more comprehensive accurate cost information effectively，andthe information can better support cost management.This study concludes with discussion that the implication of ABC system, which as partof activity-based management(ABM) system, will help in assessing an accurate and better resource usage rate.