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Comparison of activity-based costing and time-driven activity- based costing for printed circuit board assembly in industry production.pdf - Accepted Version Download (3MB) | Preview |
Abstract
Traditional costing analysis (TCA) is a method used to assign costs to products based on the volume of resources used. The issue with TCA is that factory overhead only considered direct labor, so a small change in the volume of resources triggers a massive change in the amount of overhead applied. Subsequently, activity-based costing (ABC) was developed to overcome the cost allocation problems associated with TCA by using a more detailed analysis of the relationship between overhead costs and cost drivers. However, ABC is theoretically incorrect when it ignored the potential for unused capacity which will be beneficial for forecasting. Recently, the model of ABC and time- driven activity-based costing (TDABC) method was compared in the study of magnetic inductor’s process line. ABC highlights the cost driver in the costing structure while TDABC appraises the role of capacity cost rate and time equation which eventually leads capacity utilization information that is useful for forecasting in the future. The main objective of this work is to compare the costing method for electronic production. ABC and TDABC is developed for the electronic production located at Pasir Gudang, Johor. Both methods are compared in term of cost allocation, driver determination action taken for an additional activity, cost consideration, informative, transparency, oversimplification of activities and capacity forecast. As a result, a forecasting of cost per unit for a single PCBA using ABC method was obtained at RM14.02 which slightly higher about 5.27% than TDABC method, which is only RM2.66. Next, TDABC also 0provided the exact amounts and values relating to a company’s unused capacities. The unused capacity analysis gives two information which are unused time and unused cost. The unused time and unused cost for preparation loading part activity are -1,787,800 minutes and MYR -10,499,733.60 respectively, which can be said that the previous costing method over defined the costing cost. Meanwhile, the unused time and unused cost for solder paste printing activity are 776,200 minutes and MYR 1,711,402.40 respectively, which can be said that this activity costing cost is well defined as it is only slightly different with its actual used time and used cost. By comparing ABC and TDABC method, one of selected features that has been compared is number of drivers which ABC only used single driver while TDABC used multiple drivers. Due to limitations of time, this study only considers one shift production, thus for future study may consider to conduct the study for the night shift in order to observe the difference level of effort (human resources) between day shift and night shift.
| Item Type: | Thesis (Masters) |
|---|---|
| Additional Information: | Thesis (Master of Science) -- Universiti Malaysia Pahang Al Sultan Abdullah – 2024, SV: Dr. Mohd Yazid bin Abu, NO. CD: 13714 |
| Uncontrolled Keywords: | time- driven activity-based costing (TDABC) |
| Subjects: | T Technology > TA Engineering (General). Civil engineering (General) T Technology > TS Manufactures |
| Faculty/Division: | Institute of Postgraduate Studies Faculty of Manufacturing and Mechatronic Engineering Technology |
| Depositing User: | Mr. Mohd Fakhrurrazi Adnan |
| Date Deposited: | 15 May 2025 04:42 |
| Last Modified: | 15 May 2025 04:42 |
| URI: | http://umpir.ump.edu.my/id/eprint/44558 |
| Download Statistic: | View Download Statistics |
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