scholarly journals ALLOCATION OF FIXED COSTS: CHARACTERIZATION OF THE (DUAL) WEIGHTED SHAPLEY VALUE

2011 ◽  
Vol 13 (02) ◽  
pp. 141-157 ◽  
Author(s):  
PIERRE DEHEZ
Keyword(s):  
Shapley Value ◽  
Cost Allocation ◽  
Fixed Cost ◽  
Fixed Costs ◽  
Unique Rule ◽  
Weighted Shapley Value ◽  
Alternative Set

The weighted value was introduced by Shapley in 1953 as an asymmetric version of his value. Since then several axiomatizations have been proposed including one by Shapley in 1981 specifically addressed to cost allocation, a context in which weights appear naturally. It was at the occasion of a comment in which he only stated the axioms. The present paper offers a proof of Shapley's statement as well as an alternative set of axioms. It is shown that the value is the unique rule that allocates additional fixed costs fairly: only the players who are concerned contribute to the fixed cost and they contribute in proportion to their weights. A particular attention is given to the case where some players are assigned a zero weight.

Fair Allocation Fixed Cost Using Cross-Efficiency Based on Pareto Concept

2020 ◽  
Vol 37 (01) ◽  
pp. 1950036
Author(s):  
Hamid Sharafi ◽  
Farhad Hosseinzadeh Lotfi ◽  
Gholam Reza Jahanshahloo ◽  
Somayeh Razipour-GhalehJough
Keyword(s):  
Decision Making ◽  
Cost Allocation ◽  
Fixed Cost ◽  
Data Envelopment ◽  
Fair Allocation ◽  
Fixed Costs ◽  
Suggested Model ◽  
Shared Resources ◽  
Decision Making Units ◽  
Significant Point

Among homogeneous entities, there are some shared resources from which all the entities benefit. A significant point is to allocate the fixed costs of these shared resources equitably between entities. Data envelopment analysis is a technique applied for decision-making, concerning and evaluating the performance of decision-making units. One of the functions of these units is to solve the fair fixed cost allocation problem, based on the performance of a set of homogeneous decision-making units. In this paper, a method for allocating fixed costs using cross efficiency has been suggested, where the obtained result is Pareto cross-efficient. Moreover, the proposed method helps estimate the value of [Formula: see text] (lower bound of weights) and the mode of selecting [Formula: see text] for the suggested model using the standard deviation. Finally, by using a numerical example, the proposed method of allocating fixed costs is compared to the previous ones.

scholarly journals Estimating the Cost of Producing Container-Grown Landscape Plants with the Assistance of Computer Accounting Software

1997 ◽  
Vol 15 (2) ◽  
pp. 95-101
Author(s):  
Kenneth H. Foshee ◽  
Lisa Offenbach House ◽  
Travis D. Phillips
Keyword(s):  
Cost Allocation ◽  
Production Method ◽  
Plant Production ◽  
Fixed Cost ◽  
Fixed Costs ◽  
Record Keeping ◽  
Landscape Plants ◽  
Accounting Software ◽  
The Cost

Abstract Procedures and practices for a container nursery record keeping system were developed. The goal of developing this system was to allow for cost allocation to a given group of plants for pricing and planning purposes. To accomplish this, the economic engineering method was employed to develop a model nursery firm where the best proven practices of plant production were utilized. Enterprise budgets were updated and modified to estimate cost of production for container sized #1 woody landscape plants by five plant species. Job-cost accounting procedures were used to allocate annual fixed costs and general overhead expenses. Results revealed that fixed cost per plant represented approximately one-third of total cost per plant for each species and production method. Determination of per-plant costs in trials was important in determining whether the production of a species was profitable. This also aided in establishing selling prices.

scholarly journals ANALISIS ESTIMASI COST-VOLUME-PROFIT (CVP) DALAM HUBUNGANNYA DENGAN PERENCANAAN LABA PADA HOTEL TLOGO MAS SARANGAN

2012 ◽  
Vol 1 (1) ◽  
pp. 13
Author(s):  
Satrijo Budi Wibowo
Keyword(s):  
Least Squares ◽  
Analytical Techniques ◽  
Fixed Cost ◽  
Fixed Costs ◽  
Method Of Least Squares ◽  
Breakeven Point ◽  
Total Sales ◽  
Profit Growth

<span>This research aims to analyze the estimated Cost-Volume-Profit (CVP) in association with the Profit Planning at Tlogo Mas Hotel Sarangan. Analytical techniques used in this study were: (1) Classify all costs incurred in the variable costs (variable costs) and fixed costs (fixed cost). (2) Method of least squares analysis. (3) Analysis of the breakeven point (Break Event Point / BEP). The results showed that Tlogo Mas Hotel Sarangan determine the profits of 10% of total sales. It is seen from the fluctuations experienced profit growth each year from 2009 to 2011.</span>

scholarly journals OPERATIONAL LEVERAGE AS A SOURCE OF PROFITABILITY OF BUSINESS IN CROATIA

2019 ◽  
Vol 17 (1) ◽  
Author(s):  
Vedran Šupuković ◽  
Zvonko Merkaš ◽  
Zoran Gajić
Keyword(s):  
Fixed Cost ◽  
Fixed Costs ◽  
Total Revenue ◽  
Commercial Policy ◽  
Main Hypothesis ◽  
Revenue Growth ◽  
Organic Growth ◽  
Net Profit ◽  
The Republic ◽  
High Level

Operational leverage measures the level of fixed costs in the company’s total expense and has a significant impact on the profitability of a company, especially in activities where large initial investment is necessary, and long acclimatization timeframes and high levels of revenue are needed to reach the profitability threshold. Fixed costs do not grow linearly with revenue growth and thus negatively affect profit with an insufficient level of total revenue. The paper explores the possibilities of using an operational leverage in combination with commercial policy in order to create a profit multiplier. Research has been conducted in companies in the Republic of Croatia that operate in continuity with low levels of profitability, up to 5% of net profit. In the research, the main hypothesis of work is set, by which the operational leverage is defined as a profit multiplier under the conditions of even the smallest organic growth of the enterprise in case it also operates with a high level of fixed costs. The paper begins with the fact that the effect of the operational leverage is of particular importance in certain segments of the economy that are constrained by the impossibility of entering into part of fixed costs and that their increase in profitability depends solely on the level of healthy organic growth. Accordingly, a model is considered in which an operational leverage has the ability to progressively leverage profitability, which in combination with the adequate application of commercial policy measures determines the dynamic character or processes that generate a multiplication effect even in the case of very small revenue growth. In this and such context, we are talking about the significant effect of operational leverage on company’s profitability even when neglected revenue growth affects the level of fixed cost reduction in relation to total revenue, thereby increasing profitability.

Maximum Capacity Path Interdiction Problem with Fixed Costs

2019 ◽  
Vol 36 (04) ◽  
pp. 1950018 ◽  
Author(s):  
Abumoslem Mohammadi ◽  
Javad Tayyebi
Keyword(s):  
Network Optimization ◽  
Budget Constraint ◽  
Target Point ◽  
Fixed Cost ◽  
Fixed Costs ◽  
Current Position ◽  
Maximum Capacity ◽  
Real World Datasets ◽  
Capacitated Network ◽  
Strongly Polynomial

This paper addresses a network optimization interdiction problem, called the maximum capacity path interdiction problem. The problem is a hierarchical game containing two players: one evader and one interdictor. In a capacitated network, the evader wants to find a simple path from his current position to a target point with maximum capacity to send his forces along it while the interdictor decreases arc capacities under a budget constraint to interdict the advance of the evader’s forces as much as possible. This paper studies the case that each arc has a fixed cost for decreasing its capacity. An algorithm is proposed to solve the problem in strongly polynomial time. Computational experiments on two real-world datasets guarantee the efficiency and accuracy of the algorithm.

Application Tool for Two-Variable Cost Allocation for Small Urban, Rural, and Tribal Transit Agencies

2020 ◽  
Vol 2674 (4) ◽  
pp. 407-418
Author(s):  
Todd Hansen ◽  
Michael Walk ◽  
Shuman Tan
Keyword(s):  
Financial Management ◽  
Cost Allocation ◽  
Performance Metrics ◽  
Agency Cost ◽  
Ease Of Use ◽  
Variable Cost ◽  
Fixed Costs ◽  
Assistance Program ◽  
Service Information ◽  
Transit Agencies

The paper presents the development and methodology of application tools for use in transit agency cost allocation. Researchers worked with the National Rural Transit Assistance Program to develop the Two-Variable Cost Allocation Calculator applications as a resource for small transit agencies. Reports and guidance on cost allocation were reviewed to identify key considerations for application design, was also informed by previous experience with transit agencies for examples of cost and data considerations with respect to agency size, travel mode, and type of service. The applications use a two-variable methodology of vehicle hours and miles to allocate variable costs for each service, then allocate fixed costs according to the proportions of variable costs. The applications also provide a process to sub-allocate costs for shared-ride demand responsive services using passenger hours and miles data. A common set of data requirements needed to run the applications into groups of service, financial, and operational data was developed. The applications use standard definitions of data elements from the National Transit Database and Federal Transit Administration to streamline the data needed in the application with existing reporting requirements. The applications are designed for ease of use by small transit agencies with limited staff and different levels of training in data collection or financial management. The applications allow small transit agencies to specify aspects of service information to be used in cost allocation while relying on the applications to sort expenses into appropriate cost function categories, calculate costs by service type, and generate summary reports and performance metrics.

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