Cost allocation brings a culture of unity to a company. ... Absorbed Cost: Definition, Examples, and Importance. Transferred-in Costs: What It Means, How It Works, and Example.

Assume, for example, that total indirect costs are $3,000. The printing department has direct costs totaling $4,000, and the mail room has direct costs totaling $2,000 for a combined total of 6,000.

Roth, A. E., and R. E. Verrecchia. "The Shapley Value as Applied to Cost Allocation: A Reinterpretation." Journal of Accounting Research 17, no. 1 (spring 1979): 295 ...