On the operating cost method of production and development

Abstract: Costing the background and the introduction of domestic and international development process, discusses the costing from theory to practical application in the process of costing the future development and use have a certain understanding.

Keywords: Costing; Background; development; job

1 Background costing

(1) in-time production system implementation, in order to create job cost accounting have important application conditions, timely system of the traditional "transaction-based costing" or "cost basis of the number of" strong impact, and led directly to operating costs the formation and development of accounting. job cost accounting system for the production and generate timely, because of timely development of system development.

(2) Since the variable cost method to use in practice is not ideal, so the entrepreneur is now more emphasis on full cost method. Practitioners believe that the cost of short-term variable cost is the product of a measurement scale is not sufficient, they tend to fixed costs being allocated to each product to the full cost as a long-term product manufacturing costs, full cost method for practitioners of this interest, it becomes the reality of the job cost accounting produces soil.

(3) in high-tech conditions, the traditional method of calculating the cost of the product cost information leading to a serious distortion of .20 since the 1970s, many Western manufacturers of the manufacturing environment has undergone major changes and many companies need more accurate product cost information, turn more attention to the cost calculation the past seems a reasonable method of calculation in the new environment, but there have been distorted cost information, decision-making and management can not meet the needs of the phenomenon, while the traditional costing method requires direct materials, direct labor and manufacturing costs are all traced back to the product, direct costs attributable to the object as clear, accurate and can be assigned, and the occurrence of indirect costs, but more motivation, general motivation level of the unit to be allocated, in the case of manufacturing costs more , will be seriously distorted product costs.

Times of change lead to changes in business environment, changes in business environment requires enterprises in the fierce competition in the efforts to improve and perfect the management techniques and methods to reduce costs, increase productivity and efficiency. With the cost of business-to-accuracy requirements, operating cost slowly into the cost of doing business managers in the field of vision.


2 the development of activity-based costing

(1) the development of foreign-based costing.

Costing the production dates back to the late 1930s early 1940s, prominent accounting guru Eric • Kohler, Kohler was facing the question is, how to correctly calculate the cost of hydroelectric power industry in its .1952 He edited <<accountants Dictionary>> in the system set out his job accounting thought.

1971 George • Stobbs published <<costing and input-output accounting>> as an outstanding theorist of cost accounting, he insisted: Accounting is an information system, job cost accounting is a decision usefulness objectives linked to accounting. Research job cost accounting should first clear the three concepts, "operation", "cost", "accounting objective - making usefulness." proceeds to reveal the nature of accounting, must first explain the objective of the report, this target that the trust responsibility or fiduciary duty, the main decision-making is to provide information for investors, costing the "cost" is not a stock, but a outflows. To be a better solution accounting cost allocation issues, cost of the object should be the job, rather than finished products, the cost should not be rigidly divided into direct materials, direct labor, indirect costs, but should be based on the amount of resources to calculate the full cost of using each resource.

1980s, Harvard University Professor Cooper and Kaplan wrote a series of two cases, the Western papers and books before the accounting profession in general attention. Cooper have published a series of activity-based costing papers, Basically, the practical needs of ABC, run the program, the choice of cost drivers, cost and other aspects of the establishment of the library made a more comprehensive analysis of Cooper and Kaplan also co-operation in <<Harvard Business Review>> published << calculate the cost of correctness: make the right decision>> a text which marks the start costing from theory to application.

Late 20th century to the United States, Britain and other countries as the representative of Western accounting profession began to ABC's theories and practices in a wide range of Research interests, a number of accounting scholars and published a large number of studies of costing of papers and monographs, costing has become a widely accepted concept and terminology, ABC's theory is also maturing, and in Western countries, some enterprises has been widely used, has prompted the development of activity-based costing.

(2) China Research costing.

In China, the earliest articles on activity-based costing is easy in victory, Ma Xianming, Liang compiled and published in <<Accounting Research>> sixth of the <<management accounting: challenges, strategies and ideas>> With the dramatic changes in the mode of production, manufacturing changes in the environment of the traditional cost accounting cost information does not reflect the true cost of the product, the traditional cost accounting systems are more and more critical, while operating costs will be more and more rules business people and scholars. Links to free download http://www.hi138.com 3 costing principles and the use of

(1) the basic principles of costing.

Costing is based on: activities consume resources and products consume activities. Costing the essence is: "work" as the basis for allocating overhead costs and indirect costs and products are linked through the operation, we need to find cause change in indirect costs of operations, and to allocate indirect costs of these operations as the basis for operating cost method requires first under the operating conditions of resource consumption costs of resources allocated to the job, followed by tracking to the product cost based on cost drivers, that is resources - operation - the product.

Job cost accounting is a job-based scientific information system, which calculated the cost from the "product" as the center moved to the "job" as the center, and resource flows for clues to the causal relationship between consumption of resources is cost distribution based on all operating activities reflect the dynamic tracking and analysis, greatly expanded the scope of cost accounting, cost allocation methods to improve and optimize the performance evaluation scale, provide a more accurate cost information utilization of resources, better play in decision making, planning, control role in promoting continuous improvement of operations management, accounting information to meet all the requirements of the face, to overcome the disadvantages of the traditional cost system.

(2) operating cost method in use in China.

Costing the production and developing and adapting high-tech manufacturing environment, the correct calculation of product cost requirements, it reform the allocation of indirect costs to provide new ideas and methods. With our company's international operations, broadening the business value spatial extent of the chain, also requires expansion of the spatial extent of modern cost management, value chain optimization for the enterprise to provide useful information, costing the world economy is adapted to the needs of the development of this addition, the cost of operating costs will be divided into value-added and non value-added operations operations, and help us to establish the customer first business ideas, timely production costing systems need to provide effective and accurate cost information relative to the years, always in our cost accounting scientists to explore our cost management model, and made a wealth of Research, has a profound theoretical accumulation. In addition, through nearly 20 years of education and training, the quality of our accounting staff are constantly improving, coupled with years of advanced management thinking into the corporate accounting staff can quickly understand and use activity-based costing, cost management for the promotion of work laid the foundation.

With the rapid development of science and technology, our production organization and production technology is undergoing profound changes, which the company uses in-time production and flexible manufacturing systems, the implementation of total quality management to provide the material conditions, and thus also for the job the cost of implementation to provide a basis in reality.


References
[1]  Fan Dehai. Costing application countermeasures [J]. Era trade, 2008, (2).

[2]  Zhang Ning. Our review of activity-based costing applications and prospects [J]. Accounting magazine, 2005, (22). Links to free download http://www.hi138.com