COLLABORATING ACTIVITY BASED COSTING AND ECONOMIC VALUE ADDED TO DETERMINE SHAREHOLDERS’ VALUE AT PT. GUDANG GARAM, Tbk

Abstract

The increasing number of private companies establishment nowadays, indirectly make the burden of the management become heavier, because they should not only focus on achieving production cost efficiency, but also be able to maintain the trusty of the shareholders by showing an attractive profit figures every
year. Implicitly, this profit figure is the management accountability proof on the capital invested by the shareholders. Thus, the management needs a tool that can be used to control the use of production and capital costs. The collaboration of Activity Based Costing and Economic Value Added is the appropriate
solution in controlling both cost and capital. This journal will show the implementation of this tool to achieve efficiency in the production cost and also the cost of capital to maintain the shareholders’ value in the Hand Rolled Department of PT. Gudang Garam, Tbk. The research methodology uses qualitative and quantitative approaches to the case study method. The data used for problem solving resulted by interviews, observation and documentation study in the company. The analysis technique of this research is to analyze financial data and make a comparison according to the theory of the problems identification. Therefore, it can be concluded that ABC-EVA collaborated system can make the invisible cost become more visible and more manageable in order to result more accurate and reliable product cost.