An application of activity-based costing in the chicken processing industry: a case of joint products

A great deal of research has been presented on the application of activity-based costing (ABC) in the manufacturing and service industries. In the field of agribusiness, which focuses uniquely on joint products, few studies exist that illustrate applications of ABC. This research has therefore applied ABC to a food company, concentrating on fresh and frozen chicken processing production. The basic process of ABC, based upon five steps, was applied and demonstrated the difficulties in applying cost data collection, identifying activity and cost drivers, as well as collecting driver data. The results also revealed significant differences in unit costs derived by ABC and the company’s existing cost system, particularly within frozen food products. This may suggest the possibility of distorted cost allocations within the company’s current costing system.


Issue Date:
Jan 21 2016
Publication Type:
Journal Article
ISSN:
1559-2448
Language:
English
Published in:
International Food and Agribusiness Management Review, Volume 20, Issue 1
Page range:
85-97
JEL Codes:
M41




 Record created 2017-10-13, last modified 2017-10-13

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