An alternative activity-based costing system proposal to the traditional costing system in the machine manufacturing sector

In line with the changing needs and opportunities of the times, production enterprises are diversifying their product ranges and production styles. This situation makes it necessary for businesses to adopt modern approaches to cost determination methods. One of the main functions of these requirements is to ensure that unit costs can be calculated accurately. Activity-Based Cost System (ABC) is one of the cost calculation systems that emerged to respond to the points that Traditional Costing Systems (TCS) are insufficient and need to change in order to calculate unit costs accurately. In the study, ABC is explained in detail and costing and accounting record order is suggested for the sample business. According to ABC results, trial balance, journal entries and income statement were prepared and compared with TCS information. The effects of ABC on business performance in terms of cost, profitability and financial reporting have been revealed. The company's data were converted into ABC outputs and the differences were explained. The business can achieve successful results with ABC, can seriously change income statement items, especially cost and profitability, can have a system to track cost information in addition to financial reporting in accounting records, can correct missing or incorrect information in its current costing and can improve its competitiveness advantage. findings have been reached.