Activity-Based Costing Decision Model For Coalmine Production Outsourcing

In recent years,production outsourcing has been increasingly significant for coalmine enterprises in the reduction of production cost and the increase in returns.The vast majority of coalmine enterprises' decision-makers have recognized the advantages of production outsourcing.But due to a lake of a unified,standard basis of outsourcing decision among coalmine enterprises in the field of practice,improper decisions more often than not lead to failure of outsourcing.Therefore,whether an outsourcing policy can be implemented correctly has emerged as one of the most important,the most urgent and also the most complicated problems at present.The paper mainly uses activity-based costing to enrich the cost-volume-profit decision model for coalmine enterprises;divides coalmine enterprises' types of activity-based costing outsourcing and current outsourcing;makes a traditional cost-volume-profit decision model,an activity-based costing cost-volume-profit decision model,and a cost-volume-profit decision model under the random fluctuation of coal price.The latter two models are improved cost-volume-profit decision models that respectively work out a decision-making interval corresponding to the models above.A coalmine production outsourcing decision analysis software has been developed in combination with Excel and VBA.The models and the software are applied to the example of a coalmine enterprise named A in Northern Shaanxi Province.It is found in the practical use that,compared with the traditional cost-volume-profit decision model,the improved ones correspond to a relatively wider decision-making interval of production outsourcing and that coalmine enterprises' outsourcing decisions on target yield have a wider range of application.In the context of random fluctuation of coal price,the decision-making intervals of the improved cost-volume-profit analysis models,which are short of a determined value range,rely on probability distribution of independent production and outsourcing production,which are subject to the variance of stochastic disturbance term.Experience-based judgment about the variance of stochastic disturbance term made by enterprises' decision-makers will have an effect on the decision-making process of coalmine enterprises' production outsourcing.