IMPROVING THE ACCOUNTING AND DISTRIBUTION OF OVERHEAD COSTS BASED ON THE USE OF FUNCTIONAL COST ACCOUNTING AND ABC SYSTEM

The article carries out a critical analysis of the traditional approach to costing. The paper reveals the problem of distortion of the cost of manufactured products from the point of view of making management decisions. The authors justify the expediency of using the ABC system for accounting and di...

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Main Authors: G. A. Adamova, L. Sh. Zhafyarova
Format: Article
Language:English
Published: Publishing House of the State University of Management 2021-02-01
Series:Вестник университета
Subjects:
Online Access:https://vestnik.guu.ru/jour/article/view/2628
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author G. A. Adamova
L. Sh. Zhafyarova
author_facet G. A. Adamova
L. Sh. Zhafyarova
author_sort G. A. Adamova
collection DOAJ
description The article carries out a critical analysis of the traditional approach to costing. The paper reveals the problem of distortion of the cost of manufactured products from the point of view of making management decisions. The authors justify the expediency of using the ABC system for accounting and distribution of overhead costs. The study gives the interpretation of the concepts used in the functional distribution of costs. The article highlights and discloses a step-by-step algorithm for the distribution of indirect costs when using the ABC system. The paper gives the advantages of using this approach in order to generate management information about the products and activities of the company. Along with that, the authors analysed the difficulties associated with the practical implementation of the functional approach in the accounting and distribution of overhead costs, in particular with the detailed information in the context of operations and cost pools.
format Article
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institution Kabale University
issn 1816-4277
2686-8415
language English
publishDate 2021-02-01
publisher Publishing House of the State University of Management
record_format Article
series Вестник университета
spelling doaj-art-42933a8cdbd84ad588c202d1a4ac5ccf2025-02-04T08:28:07ZengPublishing House of the State University of ManagementВестник университета1816-42772686-84152021-02-0101707610.26425/1816-4277-2021-1-70-761944IMPROVING THE ACCOUNTING AND DISTRIBUTION OF OVERHEAD COSTS BASED ON THE USE OF FUNCTIONAL COST ACCOUNTING AND ABC SYSTEMG. A. Adamova0L. Sh. Zhafyarova1State University of ManagementState University of ManagementThe article carries out a critical analysis of the traditional approach to costing. The paper reveals the problem of distortion of the cost of manufactured products from the point of view of making management decisions. The authors justify the expediency of using the ABC system for accounting and distribution of overhead costs. The study gives the interpretation of the concepts used in the functional distribution of costs. The article highlights and discloses a step-by-step algorithm for the distribution of indirect costs when using the ABC system. The paper gives the advantages of using this approach in order to generate management information about the products and activities of the company. Along with that, the authors analysed the difficulties associated with the practical implementation of the functional approach in the accounting and distribution of overhead costs, in particular with the detailed information in the context of operations and cost pools.https://vestnik.guu.ru/jour/article/view/2628ab-managementabc systemallocation of costscost accountingcost drivercostingindirect costsmanagement accountingmanagerial decisionsoverhead costs
spellingShingle G. A. Adamova
L. Sh. Zhafyarova
IMPROVING THE ACCOUNTING AND DISTRIBUTION OF OVERHEAD COSTS BASED ON THE USE OF FUNCTIONAL COST ACCOUNTING AND ABC SYSTEM
Вестник университета
ab-management
abc system
allocation of costs
cost accounting
cost driver
costing
indirect costs
management accounting
managerial decisions
overhead costs
title IMPROVING THE ACCOUNTING AND DISTRIBUTION OF OVERHEAD COSTS BASED ON THE USE OF FUNCTIONAL COST ACCOUNTING AND ABC SYSTEM
title_full IMPROVING THE ACCOUNTING AND DISTRIBUTION OF OVERHEAD COSTS BASED ON THE USE OF FUNCTIONAL COST ACCOUNTING AND ABC SYSTEM
title_fullStr IMPROVING THE ACCOUNTING AND DISTRIBUTION OF OVERHEAD COSTS BASED ON THE USE OF FUNCTIONAL COST ACCOUNTING AND ABC SYSTEM
title_full_unstemmed IMPROVING THE ACCOUNTING AND DISTRIBUTION OF OVERHEAD COSTS BASED ON THE USE OF FUNCTIONAL COST ACCOUNTING AND ABC SYSTEM
title_short IMPROVING THE ACCOUNTING AND DISTRIBUTION OF OVERHEAD COSTS BASED ON THE USE OF FUNCTIONAL COST ACCOUNTING AND ABC SYSTEM
title_sort improving the accounting and distribution of overhead costs based on the use of functional cost accounting and abc system
topic ab-management
abc system
allocation of costs
cost accounting
cost driver
costing
indirect costs
management accounting
managerial decisions
overhead costs
url https://vestnik.guu.ru/jour/article/view/2628
work_keys_str_mv AT gaadamova improvingtheaccountinganddistributionofoverheadcostsbasedontheuseoffunctionalcostaccountingandabcsystem
AT lshzhafyarova improvingtheaccountinganddistributionofoverheadcostsbasedontheuseoffunctionalcostaccountingandabcsystem