Costing Management In Modern Manufacturing Industry

Manufacturing companies get more and more rivalry/competitive pressure in their industry; cost management focuses more on the strategic level, which is to provide more cost information to the management team and help them make strategic and operational decisions. On the contrary, the conventional costing system emerges quite a lot disadvantages and gets questioned by the public due to their account information already not that relevant, precise and accurate. Therefore, a new costing system to remove the weakness of the old one by providing more precise, complete and prompt cost information has become one of the focused topics which are expected, by the costing realm of theory and practice, to be solved urgently.This thesis proposes, combine the strengths of ABC and Standard Costing while removing the weakness, i.e., to guarantee the Standard Costing control in direct cost while ABC assign in indirect cost. based on the current costing theories while absorbing the relevant researches in China and aboard, proves it is possible to so after comparing and analyzing the2costing models both in theory and in practice. Those2costing systems do not contradict to, but can make up for each other.After using this theory to applying on an actual enterprise, based on Standard Costing management, to keep the Standard Costing in controlling the direct cost with ABC in assigning the indirect cost to achieve a balance in the manufacturing cost assignment, turns out it’s not only improve the quality of cost information as well as controlling but also well apply on strategic cost analyzing. This new cost management is summarized here as Standard Activity Based Costing which paves a new way for the manufacturing companies.