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This study was conducted to estimate the total cost associated in producing an international student and to compare the estimated costs with actual fees charged. This study employed Activity Based Costing method to analyse associated costs based on the concept of life cycle throughout the student’s study duration on the basis of semester at Universiti Pendidikan Sultan Idris (UPSI). The results suggested that the Faculty of Languages and Communication has the highest cost for producing an international student while the lowest cost was incurred by the Faculty of Human Sciences. The results also indicated a substantial difference between the fees charged by the university and the estimated costs. The findings of this study are useful in identifying value added and non-value added activities and resources incurred by a higher education institution in its internationalisation effort. This study should also assist the management of the university to plan effectively and efficiently in terms of cost management and determine a more competitive and suitable fee structure.

The Internationalization of Higher Education: An Estimation of Cost Using Activity Based Costing Method