Time driven activity based costing (TDABC): A case study on a manufacturing company

Changing environmental conditions due to technological developments have altered the cost structure of companies and increased the share of overhead in total costs. In an intensively competitive environment, cost management has become increasingly important in companies and forced accurate calculations of unit product costs. In this context, cost accounting literature studies on various scientific methods that would better allocateindirect costs on goods. Time Driven Activity Based Costing (TDABC) method thatuse calculations based on time principle seems to provide more accurate and timely cost information for companies. Aim of this study is to investigate the applicability of TDABC on a Small and Medium Enterprise (SME). Case study method is employed in asample manufacturing company to test the applicability of TDABC. Findings reveal that TDABC method seems to provide more accurate information and the method can be applied for SMEs. Key Words: Cost accounting, time driven activity based costing, small and medium enterprise.