经济与管理专业外文翻译--运用作业成本法和经济增加值的具体应用

A FIELD STUDY:SMALL MANUFACTURING

COMPANIES

In this section, the implementation of the proposed Integrated ABC-EVA System at two small manufacturing companies is presented. The managers of the companies wished for their company names to remain anonymous. T herefore, they will be referred to as “Company X” and “Company Y” from here on.

Prior to the field study, both companies were using traditional costing systems. The overhead was allocated to product lines based on direct labor hours. In both companies, managers felt that their traditional costing systems were not able to provide reliable cost information.

1 Company X

Company X, located in Pittsburgh, Pennsylvania, was a small manufacturing company with approximately 30 employees. Company X’s main products l ines were Overlays、Membranes、Laser、Roll Labels and N’Caps. In the mid 1990’s, a group of investors purchased the company from the previous owner-manager who had retired. At the time of the study, the company was managed by its former vice-president, who was supported by a three-person management group. Investors were primarily concerned with financial performance rather than daily decision-making. The management group was very eager to participate in the field study for two reasons. First, the management was under pressure from their new investors who were not satisfied with the current return from existing product lines; Second, management was trying to identify the most lucrative product line in order to initiate a marketing campaign with the biggest impact on overall profits.

2 Company Y

Company Y, also located in Pittsburgh, Pennsylvania, was owned and managed by three owner-managers who bought the company from a large corporation in the mid 1990’s, Company Y employed approximately 40 people. The majority of this compa ny’s business was in the area of manufacturing electrical devices and their main product lines were Motors and Motor Parts、Breakers、and Control Parts. Company Y sold its products in the domestic market as well as abroad. A portion of the company’s output was sold directly to end-users, while the remainder was sold with the help of independent distributors. The management of Company Y was

interested in using the Integrated ABC-EVA System for the purpose of cost control and profit planning.

3 Comparison of the costing systems

During the field study, three costing systems (TCA, ABC and the Integrated ABC-EVA System) were used to obtain cost information for each company in order to identify factors which may lead to distortions through arbitrary allocation of capital costs. In a comparison, capital costs were only able to be traced by the Integrated ABC-EVA System. The nature of the TCA and ABC systems resulted in arbitrary allocations of capital costs.

4 RESULTS

The main objective of the data analysis presented in this section is to investigate which factors most often distort information provided by the ABC system. As mentioned in the methodology section, factors such as diversity in production volume、product size、product complexity、material consumption, and setups often distort cost information. These factors are examined closely for possible allocation errors.

4.1 Data Analysis for Company X

The data analysis for Company X began with an examination of its cost structure. Company X’s overall costs for 1998 were evaluated by comparing the percentages of direct costs (direct labor and direct material)、operating costs (overhead) and capital costs as shown in Exhibit 1.

Exhibit 1. Cost Analysis for Company X in Thousands of Dollars

Capital costs, at 11.6 percent, represented a notable portion of Company X’s total costs. This relatively high capital costs could be explained by high investments in special equipment and fixed assets. In addition, Company X required a relatively large amount of working capital to support its wide variety of products.

The next step was to calculate product cost information and examine changes across six product lines and three costing systems. Exhibit 2 and Exhibit 3 present the results.

Exhibit 2. Product Cost Information in Thousands of Dollars