Activity-based Costing (ABC) and Activity-based Management(ABM)Implementation – Is This the Solution for Organizations to Gain Profitability?

Ildikó Réka Cardos () and Stefan Pete ()
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Ildikó Réka Cardos: University, Faculty of Economics and Business Administration, Cluj-Napoca
Stefan Pete: Babes-Bolyai University, Faculty of Economics and Business Administration, Cluj-Napoca

Romanian Journal of Economics, 2011, vol. 32, issue 1(41), 151-168

Abstract: Adherents of ABC/ABM systems claimed traditional management accounting systems generated misleading costs in a contemporary, tumultuous, often changing business environment and implementing ABC/ABM would remedy this. That is why activity-based costing (ABC) and activity-based management (ABM) represents the symbol of improved competitiveness and efficiency in every organization.The purpose of this article – after analyzing the existing literature in the field – is to emphasize that new cost systems such as ABC and ABM could be a strong couple that assures competitiveness and efficiency for each company. Another objective is to present that, besides its disadvantages, firms implement the ABC/ABM system because it permits better tracing of costs to objects, superior allocation of overheads to cost objects, financial and non-financial analysis and measures useful to managers and management accountants in the decision-making process.

Keywords: ABC; ABM; implementation process; profitability (search for similar items in EconPapers)
JEL-codes: M10 M41 M49 (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:ine:journl:v:1:y:2011:i:41:p:151-168

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