Measurement of Unused Capacity by Applying Resource Consumption Accounting Approach to Improve the Cost Information Quality: An Empirical Study

The aim of this research was to enhance the efficiency of the resource consumption accounting approach by clarifying the analysis and measurement of the unused capacity to improve the quality of cost information for multiple administrative purposes. To achieve that, an empirical study was conducted at Al-Barh Cement Factory, affiliated to Yemen Corporation for Cement Industry and Marketing. Applying resource consumption accounting approach in this factory helped detect unused capacity in the production support centers of the factory under study with a percentage of 43.2% of the total costs measured according to the factory costs system. The costs were analyzed and measured at the level of resource pools and activities pools. The research concludes that the resource consumption accounting approach improves the quality of cost information to manage resources and costs by achieving greater accurate cost allocation and greater amount of planning resources and optimal utilization of unused capacity in firms.