| dc.description.abstract | The determination of product unit cost using FBC system is perceived to not
fulfill the function of accurate costing information provider due to cost distortion.
Inaccuracy of overhead cost allocation cause the cost distortion to exist. To response
the weakness of FBC system, ABC system is established as the answer and ensured
to be able to increase calculation accuracy of product cost. To avoid the failure of
ABC system implementation, the company is demanded to observe the condition of
its appropriateness and the need of company to implement the system. Contingency
Grid model exists as analysis tool before ABC system implementation with analyzing
ten factors of company’s appropriateness condition namely product diversity, support
diversity, common process, period cost allocation, rate of growth of period costs,
pricing freedom, period expense ratio, strategic considerations, cost reduction effort,
and analysis of frequency.
This study is aimed to inspect the possibility of Activity Based Costing
system implementation in PT RIC. Case study is the type of research design in this
study by utilizing Contingency Grid Model as analysis tool to observe the company’s
appropriateness condition in implementing Activity Based Costing (ABC) system.
From the result of Contingency Grid Model analysis, it is positioned in Quadrant IV
in which ABC system is not yet appropriate though cost distortion occurs however
management tends to not use cost information yet in decision making process. Cost
distortion is strengthened from the result of costing calculation with using ABC
system. It is a warning for the company in competition if such condition occurs.
PT RIC supposedly starts to consider this costing information usage and implements
ABC system as unit cost calculation system to enable quick alteration in order to
sustain their products in the market. | en_US |
