Time-driven activity-based budgeting method and its application at a production company

In today's competitive environment, it has become more important for businesses to have rapid access to accurate cost information with regards decision making processes of managers. As a result, time-driven activity-based budgeting (TDABB) method, which proposes an alternative approach to activity based costing (ABC) method, has emerged. Time- driven activity-based budgeting (TDABB) method, which uses data based on time-driven activity-based costing (TDABC) method, helps managers to anticipate resource demands in advance, as well as to take decisions for future related demands in a quicker and more accurate way and use the corporate resources more efficiently.This study was carried out in order to find out the applicability of time-driven activity-based budgeting method at manufacturing companies in Turkey. Within the scope of the study, the applicability of TDABB at a company manufacturing plastic sheet was studied. In the first section of the study, the literature related to cost calculation methods, activity-based costing and time-driven activity-based costing method was reviewed. The second section encompasses related literature regarding activity-based budgeting and time-driven activity-based budgeting.In the third chapter, having established a TDABB model at the manufacturing company, where the model was implemented, budgeted expenses of product groups and profitability analysis was calculated for the subsequent period. In the final chapter, differences in the rate of profitability in product groups were emphasized and various suggestions are made for the production company with regards the applicability of TDABB method.Keywords: Activity-Based Costing Method, Time-Driven Activity-Based Costing Method, Activity-Based Budgeting, Time-Driven Activity-Based Budgeting