Research On The Activity-based Costing And Control Method Of ZC Power Supply Company

Electric power industry is the lifeline of national economy and the price of electricity supply is regulated by the state. Therefore the control of production cost and charges during that period is of vital importance. However, the requirement of enterprise cost accounting is higher and higher due to the changes in economic environment; the deficiency of the traditional cost accounting is exposed increasingly. Because the traditional cost accounting is not accurate and reasonable, which promotes the firms having more and more high degree of modernization to choose the new management idea and management technology to cope with the new environment. The activity-based costing, the cost accounting and management methods based on activity, emerges along with the development of high and new technology. At present, the latest cost accounting method has been employed in many fields.Previous theoretical studies on activity-based costing is mainly set on the background of manufacturing enterprises and domestic as well as oversea discussion on its theory and practice mainly focus on the manufacturing process of firm products. It is rarely employed in services-oriented enterprises. This paper applies the advanced cost accounting and management method, activity-based costing, in power supply company. This paper demonstrates the feasibility and necessity of the implementation of activity-based costing in power Supply Company. Moreover, considering power company’s characteristics of service industry and its market demands, the application model of activity-based costing is initially constructed. It can reflect the true cost of all kinds of users and reveal the different prices of electrical products from the cost difference, which helps to perfect the pricing strategies. Lastly, control the cost of the power supply company on the basis of activity, which helps the manager to reduce the unnecessary cost of the company effectively.Therefore, the establishment of a more reasonable cost accounting system and operation mechanism has become the key point and the main issue that needs to be resolved in improving the market competitiveness of power supply company. The implementation of activity-based costing for power Supply Company is of practical significance. And only the effective implementation of activity-based costing can improve the performance of listed companies.