The Effect of Adopting Activity – Based Costing (ABC) on Maximizing Profitability in Jordanian Private Health Care Sector

Abstract

The aim of this study is to assess the effect of adopting activity - based costing (ABC) On maximizing profitability in Jordanian private health care sector. Stating the role of (ABC) system in maximizing profitability in Jordanian private hospitals, showing the availability of infrastructure and capabilities of needed to adopt and apply the (ABC) in Jordanian private hospitals To achieve the Study objectives, the researcher distributed (110) of the employees in Jordanian private hospitals, to identifying the obstacles that facing Jordanian private hospitals in adopting and applying (ABC) system. to achieve the study objectives, a questionnaire was designed and distributed to survey sample of 110 respondents who worked in Jordanian private hospitals as accountants, financial managers and internal editors. (90) questionnaires were returned and the response rate of which was (81.8%).  After using the statistical analysis program "Statistical package for social studies" (SPSS). The study concluded that adopting and applying (ABC) system in Jordanian private hospitals play very important role in reducing cost in a way that maximizing profitability the results also, reveal that the infrastructure and capabilities needed to apply the (ABC) system are available in the Jordanian private hospitals in a medium degree. In addition, the results of the study showed there are a set of obstacles that facing the adoption and application (ABC) system in Jordanian private hospitals related to management, salaries and difficulty in allocating treatment costs to direct and indirect costs. The study recommended attracted qualified and trained persons who can apply (ABC) system   and connivance the management of Jordanian private hospitals of the visibility of apply (ABC) system.