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 costelevated
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.
