A framework for time-driven activity-based costing implementation at small and medium enterprises
Southern African Journal of Entrepreneurship and Small Business Management
| Field | Value | |
| Title | A framework for time-driven activity-based costing implementation at small and medium enterprises | |
| Creator | Reynolds, Arthur Fourie, Houdini Erasmus, Lourens | |
| Description | Background: South African small and medium enterprises (SMEs) are struggling to survive because of limited resources and access to low-cost funding. It may be beneficial for SMEs to focus on cost management within their organisation to mitigate the impact of inflationary pressure and high-cost funding. Published literature provides evidence that time-driven activity-based costing (TDABC), leaning on the theory of constraints (TOC), can be implemented successfully at SMEs within different industries. Furthermore, it was demonstrated how TDABC can be effective when evaluating product cost for a wide, but fixed, product range. There is, however, no generic framework available in extant literature on how to implement TDABC effectively at SMEs.Aim: The purpose of the study was to devise a framework for SMEs with resource constraints to be able to implement TDABC without exhausting limited resources.Setting: A case study at a manufacturing SME specialising in custom products was employed.Methods: The generic steps for TDABC as described in published literature were adapted for the manufacturing SME where the case study was conducted.Results: The study found that it was practical to implement TDABC at a manufacturing SME by extrapolating the cost data from a single product which harnesses all the key activities in the factory. The TDABC costing data were sufficient for analysis of unused capacity and over-expenditure, hence providing information to consider in profitability enhancement and to support the TOC.Conclusion: The proposed framework for TDABC implementation at SMEs revises the generic framework suggested in literature by focusing on key products only and consolidating activities. | |
| Publisher | AOSIS Publishing | |
| Date | 2018-11-20 | |
| Identifier | 10.4102/sajesbm.v10i1.194 | |
| Source | The Southern African Journal of Entrepreneurship and Small Business Management; Vol 10, No 1 (2018); 11 pages 2071-3185 2522-7343 | |
| Language | eng | |
| Relation |
The following web links (URLs) may trigger a file download or direct you to an alternative webpage to gain access to a publication file format of the published article:
https://sajesbm.co.za/index.php/sajesbm/article/view/194/189
https://sajesbm.co.za/index.php/sajesbm/article/view/194/188
https://sajesbm.co.za/index.php/sajesbm/article/view/194/191
https://sajesbm.co.za/index.php/sajesbm/article/view/194/187
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