Application of activity-based costing and break-even points analysis for selection of advanced planning and scheduling for planning production of products: A case study of ABC Company Limited

Abstract

The objective of this research is to study the cost of product production planning using the activity-based costing system. (Activity-Based Costing: ABC) to understand the cost structure. along with an analysis of the break-even points in selecting the APS system for planning the production of products instead of the manpower of the case study company. This is a qualitative study that involved interviews with three product production planners. The tool used in the study was a semi-structured interview related to product production planning steps and costs. The results of the research found that 1) product production planning activities before using the APS system totaled 10 activities. Production planning time was 345 minutes per production plan. 2) The base cost of activities before using the APS system was 1,627,101.72 baht per year, and when the APS system was used to replace manpower, it was found that product production planning activities were reduced to 4 activities. The production base costs are reduced to 1,117,784.88 baht per year. Production planning time was reduced to 237 minutes per production plan. 3) The payback period for purchasing an APS system to use in production planning is 4 years, 1 month, or 12 days. From the above research results, the case study company
should use the APS system in planning product production to reduce activities. time and cost, and from the analysis of the research results, it was found that the number of employees in the department can be reduced by 1 person. The company can transfer employees to work in other related sections.