COST REDUCTION USING ACTIVITY-BASED COSTING (ABC) TECHNIQUE (AN EMPIRICAL STUDY IN AL-RAKLIM FACTORY / BABEL TIRES FACTORY)

Abstract

The products of the economic (industrial) entities operating in the Iraqi environment face intense competition from imported products, due to several problems, the most important of which is the high production costs and the lack of interest by these units in studying the market, as well as the lack of government support in the manufacturing sector and sinking the local markets with imported products at a price and specifications. Competitiveness, in addition to the reliance of these entities on traditional systems in determining the costs of their products, as these systems do not provide appropriate information for pricing decisions, which requires studying and analyzing these problems and working to address them by relying on modern technologies that enable industrial economic entities to compete. The research is based on the statement of the knowledge bases of activitybased costing technology and the study and analysis of the role of activitybased costing technology in reducing costs.( ABC) in the research sample (AlRaklim Factory) contributed to reducing costs with an amount of (67420602) only sixty-seven million four hundred twenty thousand six hundred and two Iraqi dinars for the main activities of the factory through distributing the indirect costs of these activities in a more fair and objective manner, as these costs are not related to the Rakelim factory, taking into account maintaining the required level of product quality and maximizing the level of customer benefit .