The Homogeneous Cost Drivers Combined Method Under Activity-based Costing And Its Application In X Company

Activity-Based Costing(ABC)can integrate indirect costs consumed by enterprises into various products through cost drivers,thus correcting the distortion of actual cost information of products caused by traditional costing.As a result,activity-based costing has aroused extensive discussion and research from all sectors of society.However,the production process of enterprise products is becoming more and more complex,customer demand tends to diversify,and the number of activities and cost drivers involved increases,thus increasing the complexity and implementation cost of ABC system.In order to improve its competitiveness,X company implemented activity-based costing in the early days,but now it faces the same problem: there are many cost drivers in the existing ABC system,so it is necessary to combine the cost drivers to simplify the ABC system.After a comprehensive review of the relevant research on cost drivers combination,we find that the existing methods of cost drivers combination still have some shortcomings,such as cost drivers combination is greatly influenced by subjective factors and combined error is difficult to control.In order to solve this problem and simplify the ABC system of X Company,based on the homogeneity cost driver theory,this paper establishes a specific method of similar homogeneous cost drivers combination,and divides the process of homogeneity cost drivers combination into two stages: homogeneity cost drivers classification and representative cost drivers selection.Complete the classification of cost drivers from two perspectives: the first is to complete the classification of cost drivers by setting homogeneity criteria according to the degree of homogeneity,so as to ensure that any two cost drivers of the same kind meet homogeneity criteria;the second is to transform homogeneity into the space distance of cost drivers vector and classify different cost drivers according to the space distance.And established a representative cost drivers selection method aiming at minimizing combined error.By comparing the application of different methods in X Agricultural Machinery Company,the application effect of homogeneous cost driver combined method is analyzed based on error degree and quantity of cost driver.It proves that this method is efficient and feasible.Finally,the best scheme of cost driver combination of X Company is determined.The homogeneous activity cost driver of X Company is combined and the activity cost system of X Company is simplified.