Study On The Mode Of Activity-Based Costing And Economic Value-added In Product Cost Accounting

Accurate and reliant product cost information is important for making a price, reducing the cost and selecting the combination of the product. Modern technology development makes the manufacturing change gravely in the world, and the corporations pay more and more attention to the capital costs, so they push the method of calculating the product cost to step forwards. Based on the activities, this paper first analyses the formation process of the product cost during the product life cycle- product design, stock of raw, accessories and parts, manufacturing and sale etc., analyses all kinds of the expense in each stage which the corporations pay in order to produce the output, and sort the product cost depending on the activities so as account the product cost.Nest, the paper analyses the basic factors- resources, activities, cost objects, cost drivers and distribution routes and the auxiliary factors- account period and organization based on the activities, discusses the basic theory of the activity-based costing in details, puts forwards the calculating mode and the particular implementing steps of the activity-based costing, discusses the advantages of the activity-based costing on the traditional costing and points out the activity-based costing, however sufficient in the calculation of operating costs, is deficient in the handling of full capital costs. Whereas, the paper draws the conclusion by analyzing the calculation principle, advantages and shortcomings of the economic value-added that calculating the capital costs is the notable characteristic and most important factor of the economic value-added.Based on the analysis of the activity-based costing and the economic value-added, the paper focuses on discussing the combination goal of the activity-based costing and the economic value-added, putting forwards the integrated mode of the activity-based costing and the economic value-added and the activity-capital dependent analysis, building up the model of the activity-based costing and the economic value-added, discussing the advantages of the mode of the activity-based costing and the economic value-added, and giving an application example of the mode of the activity-based costing and the economic value-added.