Research On The Distribution Method Of Indirect Expense In Iron And Steel Enterprises

Because the increase of operating costs in iron and steel enterprises makes profit shrink; the increase of domestic overcapacity makes steel price continue to decline; extensive management of product cost makes it difficult to achieve cost effective analysis; and so on. The iron and steel enterprises are currently facing a severe challenge of cost management. How to choose expense allocation method effectively and achieve the refinement analysis and control of expenses, these are the urgent needs of the enterprise’s cost management and the protection of enterprises profits. So research the choice of expense allocation method about steel products has an important practical significance for enterprises.The paper studies the characteristics of the production processes in iron and steel enterprises, as well as the composition of production cost and product cost in iron and steel enterprises. It analyzes the current expense allocation situation and its difficulties, the problems of choosing allocation method in iron and steel enterprises. The expenses in iron and steel enterprises differ in various ways. The current expenses distribution methods mainly rely on experience without taking the specific expense locations into account. This leads to a number of problems, such as the poor relation among the expenses and the cost objects and the inaccuracy of expense allocation. So the research direction which is the distribution method of indirect expense in iron and steel enterprises based on rough set is selected.The paper studies the relationship among expenses in particular location which can be used to realize the quantification by expenses significance. Expense distribution model is built which is based on rough set, and then the relationship matrix between expenses is got. Through the method which is used to determine expenses significance, calculating steps of expenses significance can be got; expenses relation between expenses can be quantified; and then significance of expenses is calculated which is objective and real data support towards to the choice of expense distribution methods and cost analysis and control.The paper researches the method of how to select allocation paths under constrains of expense proportions, significances of expense and different expense locations. The method comprehensively considers expense proportions, expense significances, expense locations and breaks the linear relationship among expenses. The weights of expense significances and proportions can be calculated by the method of deviation degree, which makes decision values more credible. The paper establishes transfer rules of expenses in different expense locations. This method can establish the distribution methods between expense and expenses object, improve the rationality and accuracy of expenses distribution, and provide a quantitative basis for choosing expense allocation method reasonable, which provides great support to fine management of the expenses.