The Design Research Of Activity-based Costing Applicated In X University International College

The first China's higher education quality report,which was published by the Ministry of Education in 2016,showed that the conditions of school operation in higher education area were improved significantly.Investment in education increased substantially.By 2015,the average public education budget expenditure of Regular Institutions of Higher Education was 18,144 yuan,around 3.4 times that of 5,376 yuan ten years ago,and the annual average growth rate reached 12%.Over a span of 20 years from 1995 to 2015,the total number of teaching and administrative staffs had increased sharply from 1.065 million to 2.369 million,ranked as the first in the world.By 2020,the gross enrollment rate of higher education would be expected to achieve over 50%,and since then China would enter the popularization stage of higher education.When facing a lot of developments and opportunities,universities also met some challenges.Higher education had always been considered as using public finance to undertake its spending,so most of the universities and colleges lacked the consciousness of cost control and cost accounting,which gave rise to the lower utilization of resources.Normally,the average cost of education would be calculated as using total expenditure divided total student numbers.The cost information from the accounting view,taking students as 'product',only had statistical significance,and was unable to accurately reflect the real resources consumed by daily teaching work and the related supporting work.Therefore,it was impossible to provide financial information users with more reliable information as the basis of financial management in universities and colleges.So,cost accounting of education needed to be solved urgently.More advanced cost accounting methods could improve the allocate efficiency of financial resources,complete using performance of financial fund,and promote the governance level of universities and colleges.Based on above problems,universities should improve their financial accounting regulations and financial management regulation.Universities also needed to introduce advanced cost management concepts and applied appropriate cost accounting methods in order to enhance the management efficiency of universities.Activity-based Costing(ABC),whose proposal was treated as an innovation in cost accounting methods,was an advanced cost accounting method nowadays,and it had been used in manufacturing industry maturely.However,it was rare using ABC method to calculate education cost in universities,most of the researches in this area stayed in normative studies.As for the reasons,first,universities in China payed much attention to the calculation of various expenses and did not attach importance to the control and management of costs for a long time,which hindered the progress of using scientific methods to calculate education cost to some extent.Secondly,the classification of education cost in universities was confused,and the academic community had not yet formed a unified opinion,which increased the difficulty of education cost management intangibly.Last but not the least,based on activities,ABC method counted the consumed resources into corresponding activities,then chose activity drivers to allocate costs to the cost objects.At present,there were still disagrees in the selection of activity drivers.In this paper,X university International College was chose as the research object.ABC method was introduced X university International College for analyzing the feasibility of ABC method in calculating the education cost.Combined with X university's own characteristics,I hope to optimize education resource allocation and improve the using efficiency of funds.In the introduction part,I introduced the research background and significance,reviewed the theoretical research on education cost and ABC both domestic and overseas,and explained the current situations of education cost calculation in domestic and foreign universities,as well as the innovation of this paper.Then,I introduced the current situations of education cost calculation in X university International College and the necessity and feasibility of applying ABC to International College.Next was the main part of this paper.By referring to the relevant content of ABC method and its experience in manufacturing industry,I used ABC method to design specific calculating process of education cost for X university International College and allocated different education resources to the cost object.Later,I compare the different results between using current cost calculation method and applying ABC method,and summarized the advantages of applying ABC method.In the last part,some safeguards and concerns were discussed to provide references for other universities.