Discussion on the Application of Activity-Based Costing in Virtual Manufacturing Cell Mode

Abstract

As a new development of cell manufacturing mode, virtual manufacturing cell (VMC) has complied with the new production organization requirements of current production efficiency and production flexibility improving synchronously, and it presents new characteristics in terms of cost accounting and cost control. Traditional cost methods present some shortcomings in VMC mode. For these situations, this paper discusses the advantages of activity-based costing (ABC) in VMC mode and improves traditional ABC to better meet the cost accounting requirements of VMC. Finally, an example is used to illustrate the basic use of the improved ABC in VMC mode.