Mhlume sugar company limited: a case study in costing and pricing

This article discusses a field study of Mhlume Sugar Company Limited. The main motivation for the study was to observe, discuss, and learn about Mhlume's activity-based costing system in order to reflect upon some fundamental issues regarding costing and pricing. This article describes: (1) the physical process of sugar refining, (2) the basic nature and principles of activity-based costing (ABC), and (3) the accounting issues raised by Mhlume's operation, including their application of activity-based costing and transfer pricing considerations in their operation