Is Activity-based Costing Popular among Chinese Firms?——A Survey of China's Manufacturers on the Implementation of Activity-based Costing

摘要

This paper reports the results of a survey of 133 Chinese manufacturers on the implementation of activity-based costing (ABC). The survey's results show that many Chinese firms have used the ABC concepts with multiple cost drivers and incorporated period expenses into product costs, but the formal ABC applications are not so popular. This research also investigates the effects of cost structure, industry, region, firm size, and ownership structure on ABC applications. We find that cost structure and industry are the main causes of ABC applications among Chinese manufacturers. The firms with a higher indirect expense percentage to their total value chain costs have a higher probability of adopting ABC systems. Recently, in the past three years, innovative-industry firms have increased their manufacturing overhead expense percentages and period expense percentages, as well as visibly pushed forward applications of ABC. However, most of the traditional-industry firms continue to keep the same degree of applications as they used three years ago.