Fixed cost allocation considering the input-output scale based on DEA approach

2021 ◽  
pp. 107476
Author(s):  
Qing Feng ◽  
Zhibin Wu ◽  
Guichuan Zhou
Keyword(s):  
Cost Allocation ◽  
Fixed Cost ◽  
Input Output ◽  
Fixed Cost Allocation ◽  
Dea Approach

scholarly journals Cost-based transfer pricing with the existence of a direct channel in an integrated supply chain

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Jumpei Hamamura
Keyword(s):  
Supply Chain ◽  
Cost Allocation ◽  
Transfer Pricing ◽  
Variable Cost ◽  
Fixed Cost ◽  
Direct Channel ◽  
Content Type ◽  
Fixed Cost Allocation ◽  
Transfer Prices ◽  
Integrated Supply Chain

Purpose This study aims to analytically explore the economic role of transfer pricing in a vertically integrated supply chain with a direct channel, specifically when it uses cost-based transfer prices, as is frequently observed in management practices. We compare two representative transfer pricing methods: full-cost and variable-cost pricing. Although many firms open a direct channel, which affects the optimal decision on transfer prices, prior literature has not considered this case. Design/methodology/approach We demonstrate the results using a non-cooperative game theoretical approach. Findings The results show that full-cost pricing is more profitable than variable-cost pricing when the fixed cost allocation to the marketing division is low, contrary to the established position in prior studies, from which I select their benchmark case. Moreover, we obtain a counterintuitive result, whereby, the firm-wide profit of a vertically integrated supply chain increases with fixed cost allocation. Originality/value This study considers the direct channel and internal transfer pricing in a vertically integrated supply chain, while prior research only considers one or the other. This model suggests an optimal choice of cost-based transfer pricing in managerial decisions. In addition, the authors demonstrate the positive effect of increasing fixed cost allocation, which prior management studies do not show. The findings of this study have implications for managerial practice by providing insights into supply chain design and showing that firms should consider the competition between channels when making decisions about transfer pricing methods.

scholarly journals Fixed Cost Allocation Based on the Utility: A DEA Common-Weight Approach

IEEE Access ◽  
2019 ◽  
Vol 7 ◽  
pp. 72613-72621 ◽  
Author(s):  
Junfei Chu ◽  
Huanhuan Jiang
Keyword(s):  
Cost Allocation ◽  
Fixed Cost ◽  
Fixed Cost Allocation ◽  
Common Weight

Fixed cost allocation and the constrained product mix decision

2002 ◽  
Vol 19 ◽  
pp. 71-88 ◽  
Author(s):  
Susan Haka ◽  
Fred Jacobs ◽  
Ronald Marshall
Keyword(s):  
Cost Allocation ◽  
Fixed Cost ◽  
Product Mix ◽  
Fixed Cost Allocation

scholarly journals Fixed cost allocation based on the principle of efficiency invariance in two-stage systems

2020 ◽  
Vol 283 (2) ◽  
pp. 662-675 ◽  
Author(s):  
Qingxian An ◽  
Ping Wang ◽  
Ali Emrouznejad ◽  
Junhua Hu
Keyword(s):  
Cost Allocation ◽  
Fixed Cost ◽  
Two Stage ◽  
Fixed Cost Allocation

Centralized fixed cost allocation for generalized two-stage network DEA

2017 ◽  
Vol 57 (2) ◽  
pp. 123-140 ◽  
Author(s):  
Tao Ding ◽  
Qingyuan Zhu ◽  
Baofeng Zhang ◽  
Liang Liang
Keyword(s):  
Cost Allocation ◽  
Fixed Cost ◽  
Two Stage ◽  
Network Dea ◽  
Fixed Cost Allocation
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