INTRODUCTIONThe term management accounting refers to the production of information from internal sources. These internal sources may be high-level managers or floor supervisors. The information produced is used to plan and control the company's actions, also producing information that helps in decision making. A management accounting system is used to aid in this process. Management accounting systems can produce information about the costs of goods, products and services and other departments of the company. A management cost accounting system regularly produces information for budgeting, performance and producing cost reports (Talha, Raja, Seetharaman, 2010, P. 83). In the 1980s, more attention was paid to management accounting and its inability to keep pace with technology. Technological advances in manufacturing and information technology have led to the need for a more advanced management accounting system to replace the traditional cost management system already in place. Traditional cost management systems were in place to offer neutral and objective financial information that was easy to calculate (Talha, Raja, Seetharaman, 2010, P. 83-91). To keep up with these changes, activity-based costing (ABC) was created. ABC is considered an alternative approach to traditional cost management models. This accounting approach focuses on causality and gives decision makers the ability to manage costs at the root, instead of focusing only on the cost of the product (Talha, Raja, Seetharaman, 2010, P. 91). ACTIVITY BASED COSTING: THE BASICS Activity-based costing (ABC) was first proposed to the United States in the 1970s-80s. ABC has been brought to the country for over...... half the paper ......er Profitability: Insights from the paper industry in Florida. Research in Business and Economics Journal, 1-9. Retrieved from http://origin-search.proquest.com/docview/1114066869?accountid=91041Talha, M., Raja, J. B., & Seetharaman, A. (2010). A new look at management accounting. Journal of Applied Business Research, 26(4), 83-96. Retrieved from http://origin-search.proquest.com/docview/733023696?accountid=91041Velmurugan, MS and Bte Wan Nahar, Wan, Nur Azah. (2010, September). Factors that determine the success or failure of ABC implementation. Cost Management, 24, 35-46. Retrieved from http://origin-search.proquest.com/docview/757373364?accountid=91041Velmurugan, M. S. (2010). The success and failure of activity-based costing systems. Performance Management Journal, 23(2), 3-33. Retrieved from http://origin-search.proquest.com/docview/856125540?accountid=91041