Application Of Activity-Based Costing In Steel Plant Of XY Iron And Steel Company

With the decline of China’s national economic growth and the intensification of international trade protection,steel exports are becoming more difficult,the contradiction between supply and demand of steel is extremely prominent,the profitability of the industry is low,and the development of the steel industry is difficult.At the same time,after decades of development,China’s iron and steel enterprises have made considerable progress in large-scale equipment,automation.However,there is no corresponding development in cost management of enterprises.At present,most of China’s iron and steel enterprises adopt the traditional cost accounting method,which is simple to operate,but easy to cause enterprise cost management is too rough,unreasonable distribution of costs between products,resulting in product cost information distortion and other defects,causing great trouble to business decision-making.As an advanced cost management concept and method,activity-based costing can accurately calculate product cost information,effectively improve the effect of business decision-making,better make up for the shortcomings of traditional cost accounting methods,and has a strong practicality.Compared with the traditional cost accounting method,the activity-based costing accounting has the following advantages:(1)combining business operations with resources will help to provide more accurate cost information.(2)Effective management of business operations,distinguishing between value-added operations and non-value-added operations,will help enterprises reduce operating costs and improve their competitiveness in the market.(3)Through the accounting of cost drivers and activity centers,it is helpful to improve and optimize the performance evaluation system and promote the development and progress of enterprises.In view of the organizational structure of XY Iron and Steel Company and XY Iron and Steel Company as a large-scale steel enterprise group with 60 years’ development history,it puts the promotion of enterprise management at the strategic height of the company’s development and strengthens it during the critical period when the iron and steel industry goes out of production capacity.Management efforts,make a fuss,tamp the foundation,plug loopholes,and strive to reduce the operating costs of the company,enhance the profitability of the company,and promote the company’s sustainable and healthy development.The author in the production,marketing and research units and auxiliary logistics units and other internal operating characteristics,combined with their own study and Research on activity-based costing,determine the subject of this study,that is,the use of activity-based costing accounting for the group’s steel plant under the study,on this basis,the follow-up can be the group’s overall use of activity-based costing.The law will be further explored and studied.The basic structure of this paper is: First of all,the principle and related concepts of activity-based costing are briefly reviewed,and the advantages,applications,scope and conditions of application of activity-based costing are analyzed and introduced.Then,taking the steel plant of XY Iron and Steel Company as an example,the paper introduces its basic situation and analyzes the necessity and feasibility of applying ABC.Subsequently,the basic scheme of applying ABC in the steel plant of XY Iron and Steel Company is expounded,and the concrete process of scheme accounting and the effective application of ABC information are discussed.Finally,the safeguard measures of the application scheme of ABC in the steel plant of XY Iron and Steel Company are put forward,and the application scheme is further improved,which can also provide reference for other similar units to apply ABC.