外文文献翻译译文原文Activity-Based Costing and Management Solutions to Traditional Shortcomings of Cost AccountingABSTRACT: Traditional cost accounting has been one main, widely-used approach to costing both internally and externally. This general ledger system acts as the companys thermometer measuring the health and wealth of the overall business.The conventional methodology though can only summarize the business expenses per the chart of accounts (i.e., labor, material and other).As a result, the company lacks the ability to evaluate the internal efficiency, quality and profitability per product or service line.As a result, the company lacks the ability to evaluate the internal efficiency, quality and profitability per product or service line.The ABC/M approach records, summarizes and reports the spending into costs of activities or processes and eventually associated to each product, service and customers.“Unlike traditional accounting reports that make managers react to by being happy or sad, ABC/M data makes them smarter”3.KEY WORDS: Accounting, budgeting, cost, estimating, forecasting, life-cycle, and planningTraditionally quality cost accounting has been based on allocating a subjective or calculated range of indirect expenses to direct costs.Because of the increase of indirect and overhead expenses in recent decades, the conventional costing method has become ineffective for quality practitioners and managers.To illustrate, one product or service line may require more resources or time than another.But because the cost of indirect costs are based on a fixed percentage of direct costs (i.e., labor and materials), the overhead expenses are misrepresented or recognized correctly to the final products or services.With the conventional means to cost accounting and cost of quality, it is very difficult to identify if such product or servicen is profitable and produced via quality processes or with less wastes 14.The concept of activity-based costing and management (ABC/M) was introduced in the US, initially in the manufacturing sector during 1970s and 1980s. Robin Cooper and Robert Kaplan brought the ABC/M concept to light and published the body of knowledge in the Harvard Business Review in 1988. Cooper and Kaplan defined the ABC/M method as “an approach to solve the problems of traditional cost management systems;” that is,the conventional cost accounting systems are often unable to identify correctly the true costs of processes. Consequently, management and quality professionals are unable to make sound decisions or make decisions based on the misrepresented data 14.On the other hand, the activity-based costing and management approach objectively assigns costs based on the“cost and effect relationships.”The cost of activity is identified and allocated to each product or service if and only if the product or service uses the activity.And in 1987, Robert Kaplan and W. Bruns published in their book,Accounting and Management:Field Study Perspective,the ABC body of knowledge with the initial focus on manufacturing where technology and productivity improvement have reduced the direct costs and increased indirect and overhead expenses 14.Statement of the ProblemIn todays global competition, quality practitioners and management cannot afford the risk of making decisions based on inaccurate or incomplete data provided by the traditional accounting ledger systems. The introduction and exposure of modern approach to quality and accounting cost is necessary and applicable in both manufacturing products and service delivery.Purpose of the StudyThe thesis work will guide the quality practitioners and decision makers through the unique, more effective approach in defining true costs in the cross-functional processes.This includes the review of the activity-based costing and management approach and application within the total quality management framework.Furthermore, ABC/M will be incorporate as the quality solution to conventional cost accounting system via the concepts of lean,cost of quality and forecasting and budgeting.Through the study, the quality professionals and audiences can gain and will be able to expand their perspectives and roles in cost drivers and allocation for process cost control and improvement opportunities.Limitations of the StudyThe thesis effort is limited to the study of both traditional and activity-based approaches to true costs for management and quality professionals to measure existing quality and effectiveness and make sound decisions and for within the company, organization or department.The review and any recommendation of the quality cost approach and system will not displace the conventional cost accounting method in any mean or capacity, as the general ledger system is the sole, standard tool and communication instrument widely accepted among companies.Definition of Terms AACE International is the Association for the Advancement of Cost Engineer