The target costing of modern costing systems and an application in a manufacturing company

In order to continue their activities and increase their profitability in intense competition environment that is increasing day by day, the companies need to meet their customer demands and expectations in the best way. Companies need to control their costs while satisfying these demands and expectations. Target costing system is important for companies in order to correctly understand this relationship between customer expectations and cost management. Because by using this system companies can decrease their costs. The aim of this study is to determine and examine the applicability of the target costing system in a manufacturing company operating in steel pipe sector. As a research methodology, the case study is preferred because it is suitable for the scope and aim of this study and allows for detailed analysis. In this perspective, first descriptive case study method was applied and by this way company's existing production and accounting systems were examined. Then exploratory case study was applied to explore the effect of target costing system on company's cost and profitability. Keywords: Target cost, target costing system, traditional system, cost control.