the integration of activity based Costing with the theory of constraints and its role to enhance profitability

Abstract

This research considers how aspects of the theory of constraints may be integrate with activity based Costing to enhance companies Performance through enhancing profitability ,both of them represent alternative paradigms for modeling a firms production structure the resulting model captures the interaction between the cost , physical resources , and capacity of production activities the model enables an optimal production mix to be determined from simultaneous evaluation of ABC data and , physical attributes of the production process ,equally important ,it facilitates identifying a bottleneck production activities that constrains the firms production opportunities .