An Empirical Study Of Application & Usefulness Of Activity-Based Costing And Activity-Based Management Techniques In Practice

Abstract

The extent to which ABC and/or ABM techniques have become an active part of decision making apparatus in American companies can be best determined by direct contact with the actual and potential users of these techniques. This way a researcher can empirically and effectively evaluate the degree of usefulness of these techniques in running business operations. Because of the prominent role of Fortune 500 largest Industrial Corporations in American industry, and also their ability to select and implement the latest and most sophisticated accounting techniques for their operations, these corporations were deemed to be the best actual or potential users of ABC/ or ABM techniques, and hence they were selected for this study. Copies of a questionnaire containing 21 questions were mailed to the managers and controllers (via the presidents) of all Fortune 500 corporations in the United States. It was expected that the results of this research would assist the researchers to reject the null and sub-null hypotheses and conclude the degree of use and usefulness of ABC/ or ABM models in business operations and decision-making apparatus.