SIMULTANEOUS USE OF SIMULATION AND ACTIVITY-BASED COSTING FOR THE DESIGN AND COST ANALYSIS OF MANUFACTURING SYSTEMS

The main goal of this work is to show the simultaneous use of Manufacturing Systems Simulation and Activity-Based Costing (ABC) for the design and cost analysis of manufacturing systems. Initially, Simulation is applied to model the entities involved in a manufacturing system. Moreover, Activity-Based Costing is applied for cost calculation of all activities in manufacturing, including machining, setup, material handling and so on. Resource costs are assigned to activities, based on the consumption of each resource required to carry them out. The amount of each manufacturing activity executed in benefit of products, as defined by the Simulation process, establishes total activity costs. Therefore, Simulation helps in the determination of the resource and activity cost drivers used by the Activity-Based Costing in the cost assignment process. A case study of a manufacturing cell is described and validates the relevance of the simultaneous use of Simulation and ABC in the design, in the cost analysis and in the operational policies of manufacturing systems.