Application Of Activity-based Costing In Cost Management Of Y Garment Manufacturing Company

Garment manufacturing industry plays an important role in China’s national economy and is one of the basic industries of China’s manufacturing industry.In recent years,the profit level and profitability of the traditional garment industry have continued to decline,and the operation of small and medium-sized garment manufacturing companies has become more difficult.Their sales market has been stable,and it is difficult to increase their operating income.Therefore,cost management based on accurate cost information is very important for enterprises,The cost not only has a direct impact on the enterprise’s profits,but also has a significant impact on the enterprise’s own strategic decision-making and development direction.Only by obtaining accurate and effective cost data can the enterprise managers make scientific decisions based on this,and lay a foundation for the enterprise to gain a firm foothold and seek development.Based on the cost management of the clothing manufacturing company,this paper investigates y clothing manufacturing company on the spot.Guided by the activity-based cost theory,this paper makes an in-depth analysis of the current business situation and problems of Y clothing manufacturing company,and applies the activity-based cost method to the cost management practice of Y clothing manufacturing company.First,identify the specific operations in the production and operation process of Y garment manufacturing company,divide them into operation centers and collect resource costs,then determine the cost drivers suitable for the operation centers of Y garment manufacturing company,allocate the resource costs of each operation center to products according to the cost drivers,and obtain more accurate product cost information through specific accounting,It has established a cost accounting system based on the activity-based cost theory for y garment manufacturing company,further optimized the cost information acquisition,cost accounting and cost control of Y garment manufacturing company,compared and analyzed the existing cost allocation results and the implementation effect of activity-based costing on the basis of more accurate cost information,and provided guidance for the existing product decision-making problems of Y garment manufacturing company,It also puts forward the relevant enlightenment for similar garment manufacturing companies to apply ABC,and puts forward corresponding safeguard measures for the application of ABC.Through the study of Y clothing manufacturing company,it is found that the application of activity-based costing to obtain more accurate and scientific cost information is conducive to improving the company’s business decision-making.The cost accounting system based on activity-based costing is the primary component of Y company’s cost control system.The application of activity-based costing to cost allocation not only makes the result of cost allocation to products more reasonable and accurate,It can provide effective reference and data support for the company to adjust pricing strategies and product decisions,formulate overall development goals and corporate strategies,and also improve the cost control system of company Y,provide preconditions for the subsequent implementation of cost control based on the value chain,and finally improve the company’s refined cost management level.The research on the application of Activity-Based Costing in Y company also has some enlightenment on the application of Activity-Based Costing in similar garment manufacturing companies.It is expected to provide optimization ideas of cost management for the same type of small and medium-sized garment manufacturing enterprises.