Activity-Based Costing as a Strategic Tool for Enhancing Key Financial Management Functions: Evidence from the Manufacturing Sector in Jordan

Ammar Bashatweh

doi:10.54489/ijtim.v4i2.475

Authors

Ammar Bashatweh Luminus Technical University College, Amman, Jordan

DOI:

https://doi.org/10.54489/ijtim.v4i2.475

Keywords:

Accounting, Management, Planning, Controlling, Decision-making, Pricing, Financial decision, Jordan

Abstract

The objective of the study was to examine the impact of implementing the activity-based costing (ABC) on planning, controlling, decision-making, and pricing. The study population consists of employees working at Al-Hassan Industrial Estate. The sampling unit consisted of employees holding the positions of financial manager, chief accountant, and cost accountant. The study used quantitative approaches to gather data by distributing questionnaires. The research yielded many findings. The use of the activity-based costing (ABC) approach plays a crucial role in enhancing the efficacy of the financial management process. The use of the Activity-Based Costing (ABC) method has a significant impact on several financial management processes, including planning, controlling, decision-making, and pricing. Based on the findings, it is advised to promote the use of the Activity-Based Costing (ABC) method inside industrial enterprises. The study further suggested transitioning towards the adoption of an activity-based costing approach in the realm of pricing and decision-making.

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