Abstract:
The motive behind this study was to find out the activity-based costing practices of some selected manufacturing firms in Sekondi-Takoradi. The research design adopted was a descriptive survey. The study targeted one hundred and twenty (120) people, comprising chief financial officers, finance directors, and other accountants of the food production companies in Sekondi-Takoradi. Eighty respondents were purposively sampled for the study and the results were analyzed using descriptive statistics. It was revealed from the study that some food manufacturing firms in Sekondi-Takoradi use Activity-Based Cost as a cost analysis tool in the cause of producing goods and services. Secondly, it was found that Activity-Based Cost implementation aids firms in the classification of cost based on production activities which enable the firms to know what costs went into production at each stage. Thirdly, the study depicted that Activity-Based Cost has been beneficial since it demonstrated an appreciable cost-elevated cost designation system that aids firms to recognize the real costs of products or services. Finally, the study discovered that even though Activity-Based Cost is of great benefit, its implementation has some difficulties as well. It was concluded that Activity-Based Cost is being adopted by food manufacturing firms in Sekondi-Takoradi due to pressure from the globalized world, advances in technology, and the dominance of foreign managers and accountants. It was recommended that Selected firms should focus on promoting awareness and training on the benefits and implementation of ABC and setting performance metrics to capitalize on the financial returns and improved product/service quality resulting from ABC implementation.
