BASES FOR ALLOCATING DISTRIBUTION COSTS.

The article reports on methods of distribution cost allocation and their applications in the field of marketing. The author focuses on evaluating methods used to allocate costs and determining whether or not those methods aid in the decision making processes of marketing management. It is suggested that there are two ways of measuring distribution cost allocation, one way is inspectional and the other analytical. Cost allocation applications for marketing and distribution expenses including transportation, selling, and storage are discussed. It is further recommended that tests be conducted to establish the relationship between cost and result in any allocation procedure.