Assessment the Unused Capacity Using Time Driven Activity Based Costing in Automotive Manufacturing Industry

Ghani, N.F.A.; Zaini, Sri Nur Areena Mohd; Abu, Mohd Yazid

doi:10.15282/jmmst.v4i1.3839

Cited by 7 publications

(5 citation statements)

References 28 publications

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“…In the process of cost allocation, each product or service will be dismantled for the most basic operation activities of the year. Then, a reasonable cost will be calculated using accurate cost traceability and cost allocation methods [38]. Using the spirit of activity-based costing for production management and decision making is the so-called "job-based management" [3,12].…”

Section: Methodsmentioning

confidence: 99%

Sustainable Decision Model for Circular Economy towards Net Zero Emissions under Industry 4.0

Hsieh,

Tsai

2023

Processes

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The world produces more than 20 billion pairs of shoes every year, and the greenhouse gas emissions of the shoe industry account for 1.4% of the world. This research, taking the knitted footwear industry as an example, combines the concepts of mathematical programming and carbon emissions to discuss the impact of a circular economy sustainable decision-making model (including four carbon tax functions) to achieve net zero emissions under Industry 4.0 on company profits and product structure. The findings suggest that using activity-based costing to measure the attribution of various costs during process improvement allows companies to more accurately capture the carbon cost of producing each pair of shoes. In addition, under the trend of global efforts to reduce carbon emissions, if the price of carbon taxes or carbon rights is not enough to affect companies’ profits, companies will not pay attention to the impact of carbon emissions. To ensure a sustainable production model, the shoe industry should work with brand customers to reduce the effects of products on the environment, coordinate with brand customers’ sustainable development milestones, and formulate a carbon reduction path to achieve zero carbon emission growth goals. Future research can apply these research models, incorporating the carbon tax and carbon rights proposed by this paper to the other industries. In addition, the research also can be extended to explore the consumer behavior for the newly developed knitted footwear.

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Section: Methodsmentioning

confidence: 99%

Sustainable Decision Model for Circular Economy towards Net Zero Emissions under Industry 4.0

Hsieh,

Tsai

2023

Processes

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“…In , the research deficit of TDABC in journals that might be utilised as a reference to the execution of the palm oil plantation was studied. Other than that, Ghani, Zaini, and Abu (2020) argued in the automotive sector that an overcapacity station and several underutilised capacity stations provide a solid concept of the company's management for improved expenditure plans. TDABC was then employed to determine the utilised and unused capacity in the supply chain.…”

Section: Literature Reviewmentioning

confidence: 99%

Development a New Costing Structure in Product and Service Operation Using Time Driven Activity-Based Costing

Zaini

Abu

2022

JTOM

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In current practice of costing method in palm oil plantation, the method does not implement time equation so processing time determined by company is not in accordance with actual processing time in work station. Then, the present implementation in academic library do not illustrate the correlation between supplied resources and practical capacity. It is to develop capacity cost rate in order to interpret it in form of unused capacity. The purpose of this study is to build a new costing structure in product and service operation using time driven activity-based costing (TDABC). For product operation, this work carried on at a palm oil plantation in Prosper Palm Oil Mill Sdn. Bhd., Pahang. For service operation, data collection of academic library is taken in Universiti Malaysia Pahang. Eventually, in product operation, the total used time in all three activity centers of palm oil plantation are 3,220,928.04 minutes for mature area and 2,390,513.94 minutes for immature area. On the other hand, in service operation, the unused capacity is RM40,960.02 and RM144,202.51 in local and oversea material respectively. In terms of unused capacity, there are no significant differences when applying TDABC in product and service operation. Whereas, regarding of process dependency, activities in product operation are dependent to one another.

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“…Soufhwee et al (2019) reported that TDABC is more accurate and faster than ABC, using an enhanced decision-making process and supporting the organization's manufacturing system of a real assembly line in the automotive industry. Also, Ghani et al (2020) had good results from the TDABC application into the same type of production to identify used or underused capacity and for a better investment strategy. The authors affirm that TDABC is a powerful tool to analyze the actual condition of production.…”

Section: Literature Overview Of Time-driven Activity-based Costing Ap...mentioning

confidence: 99%

Integrating corporate social responsibility and quality management into the TDABC costing system: a case study in the assembly industry

Vedernikova

Morocho

Sigcha

et al. 2022

SRJ

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Purpose This paper aims to show the potential of time-driven activity-based costing (TDABC) to value and integrate corporate social responsibility (CSR) and quality management (QM) processes in the assembly industry. It provides valuable insights about operational processes, sub-process and activities within assembly companies by using TDABC’s time equations with more accurate costs for the decision-making process. Design/methodology/approach The current paper proposes a new methodology framework with four QM and CSR implementation levels and several costing scenarios through the TDABC system. The valuation was built based on the activities of essential referents in each subject, such as ISO, Ethos Institute and electrostatic discharge control programs. To this end, a case study in the assembly industry processes was conducted with data from a TV assembler. Findings The results highlight that TDABC can be extended to perform a cost analysis with QM and CSR processes. The environmental management and occupational safety and health administration processes were considered part of CSR to do so. Consequently, managers can simulate the cost and impact of incorporating CSR and QM in assembly processes and thus decide the implementation degree and its corresponding planning according to the needs and available resources. In this particular case, the company increases a maximum of 12% of its resources to be socially responsible and manage its products’ quality. Originality/value Although theoretical models on CSR have been developed, the current study provides a practical framework based on TDABC scenarios that enterprises can easily implement to support and evaluate QM and CSR processes.

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Assessment the Unused Capacity Using Time Driven Activity Based Costing in Automotive Manufacturing Industry

Cited by 7 publications

References 28 publications

Sustainable Decision Model for Circular Economy towards Net Zero Emissions under Industry 4.0

Sustainable Decision Model for Circular Economy towards Net Zero Emissions under Industry 4.0

Development a New Costing Structure in Product and Service Operation Using Time Driven Activity-Based Costing

Integrating corporate social responsibility and quality management into the TDABC costing system: a case study in the assembly industry

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