Research On Application Of Activity-based Costing In The Small And Middle Home Textile Enterprises

With the development of computer technology and automation equipments widely used in the production of enterprises, the proportion of the manufacturing costs is more and more high. At the same time with the rise of people living standard, people on the requirements of the product’s design and color, variety, process and so on is becoming more and more high, this puts forward higher requirements on product of the enterprise accounting. It can meet the needs of enterprises management if there is no significant changes in manufacturing environment. Traditional cost accounting method to the complexity of products and diversity of technology does not distinguish, just based on the number of the indirect costs for distribution, this method of distribution is relatively simple. But with advances in production technology and the increasing degree of automation, precision and accuracy of this method have been challenged, even has the cost distortions, unable to meet the needs of enterprise management, or cost of providing useful information for decision makers.Activity-based costing to job resource-intensive, products consuming job as theoretical basis, taking jobs as indirect costs aggregate objects, resources fee collection on the job to form ABC; then by cost driver, job cost accumulation products. This method can avoid the defects of traditional cost accounting methods, able to provide timely and accurate cost information. Great importance has been attached to this method. And many American companies such as IBM、AT&T、Lucent technologies have already adopted the method. The results are good. In recent years, this method has been paid attention to in China and some large and medium sized enterprises have put it into study and practice gradually.This article introduced the development of activity-based costing management thought at first, then start with the activity-based costing analysis of the basic theory about several basic concepts and theoretical basis of activity-based costing, and comparing it with the traditional cost calculation method, pointed out that under traditional accounting methods of indirect costs allocated to unfairness, has a lot of drawbacks; Then through the small and medium home textile enterprises of the costing analysis of the current state, pointed out that it is very important and necessary for small and medium sized textile enterprises to implement activity-based costing and, finally, give example of MJ home textile enterprises, through the current cost approach used by collecting, collating data and concluded that activity-based costing accounting method more precise. It can enhance the market competitiveness, provide important references for the Manager’s decision. But it also pointed to possible problems and obstacles in the implementation process.Activity-based costing is not only a cost calculation method, it is a means of cost control and business management, it can make some of the indirect costs that cannot be controlled controllable, thus contributing to better management and guidance, enterprises can be used with its own, fully embodies the principle of cost-effectiveness, which are important for increasing the competitive advantage of enterprises.