The Applicability of Target Costing as a Tool for Controlling Production Costs: An Applied Study on the National Cement Joint-Stock Company

Abstract

The aim of this study is to identify the role of the target cost in producing accurate and timely data and information to assist the management in the control of the cost of production by studying the reality of the cost control system, Obstacles that prevent the application of the target cost input in Al Ahlia Cement Company. In order to achieve the objectives of the study, the study followed the analytical descriptive method. The researchers developed a questionnaire based on some previous studies. The study society represented all the workers in the financial affairs department of Al-Ahlia Cement Company in Al-Khums and its sample size was (100) employees and after the distribution of the questionnaire was retrieved (94) a complete form for the study community valid for statistical analysis, and to analyze the study data was the use of computer and the use of statistical program from the software service (SPSS) The study found that Al-Ahlia Cement Company has the possibility of applying the target cost input as a tool to control the cost of production. However, there are a number of obstacles that prevent the possibility of applying the target cost input. The most important of these obstacles are fluctuations in the prices of materials. Due to current conditions, as well as lack of the necessary expertise to prepare accurate cost and difficulty in setting and monitoring standards

Finally, the study set out a set of recommendations that are hoped to promote the introduction of the cost target as a performance control of the cost of production, based on the expertise in the preparation of accurate cost and the development of standards for monitoring, and also recommended the development of appropriate mechanisms that predict the conditions that can occur In the budget period, which makes it impossible to set up or apply the target cost system appropriately.