Activity-based costing and management: Total quality management solution to quality cost shortcomings of the traditional cost accounting systems

This thesis explores the knowledge and application of Activity-Based Costing and Management (ABC/M) as a Total Quality Management solution to the quality cost shortcoming of conventional cost accounting systems. The thesis proves to quality practitioners and decision makers that ABC/M approach is uniquely positioned as the most effective technique in defining true internal cost in cross functional processes by comparing and contrasting both the traditional Chart of Accounts and ABC/M methods. Awareness is also expanded through this study as to how Activity-Based Costing and Management is the quality solution. This is done using the concepts of Lean, Cost of Quality and forecasting and budgeting for key cost drivers and associated allocations in process cost control and improvement opportunities.