Research On Production Cost Control Optimization Of M Clothing Company Under Objective-Activity-Based Costing

Under multiple pressures,such as slowing domestic and foreign market demand,more complex trade environment and continuous increase of comprehensive costs,the garment industry investment growth impetus is weak,and the efficiency level is gradually declining.For the garment manufacturing industry,in addition to the need to have a better operating income,but also pay attention to cost control.In the process of product processing and production,M Clothing Company needs to focus on the consumption of production costs when carrying out cost control,because production costs account for a very large proportion of all costs.At present,the sales volume of M Clothing company is increasing year by year,and the average selling price of unit products is rising year by year.Due to the lack of attention to production cost control,the operating profit rate has declined significantly.Therefore,it is urgent to analyze the current cost control status of M clothing company and optimize the production cost control system based on its actual situation,so as to solve the key problems of M clothing company and achieve the purpose of cost reduction and efficiency increase.Based on this,combined with the theory of cost management,activity-based cost management,cost driver theory and the concept of target cost method,the production cost control system of M clothing Company is analyzed.It is found that there are a series of problems in the current cost control system,such as lack of attention to production cost control,serious waste of direct material cost in use and put into production,incomplete consideration of direct labor cost control,single allocation standard of manufacturing expense,unreasonable arrangement of product production process and so on.To solve these problems,a new control system of activity-based costing,which is suitable for M clothing company,is optimized and designed.This system is based on activity-based cost management and target cost management,learn from each other and combine the two methods organically.Using the principle of target costing and activity-based costing to build the production cost control framework,the first is the target cost planning,combined with the market competition situation and its own development strategy,determine the product design,and then determine the target total cost.Then,the direct cost of the total target cost is decomposed according to the actual situation,and the indirect cost is divided into the operation center,optimize the operation process,and decompose the target cost to each operation center layer by layer according to the idea of activity-based costing.Finally,the actual cost is calculated,the difference between the actual cost and the target cost is analyzed,the specific reasons for the cost difference are found out,and the precise measures are taken to control the cost,so as to minimize the difference and achieve the effect of production cost control.After the study,it is found that under the production cost control method of M Clothing Company,the product cost control effect is not good,and it is difficult to control the key points of cost,which lays a hidden danger for the subsequent development of the company.The optimized cost control method,that is,the integration of target costing method and activity-based costing method,can accurately calculate the specific cost value of products,discover the non-value-added activities in the production process,optimize the operation process,improve product production efficiency,reduce product production costs,and solve the key problem of insufficient production cost control of M Clothing Company.For the company to turn around the situation,improve market competitiveness to lay a solid foundation.