The usability and suitability of allocation schemes for corporate cost accounting

Abstract

Several instruments may be employed by accountants to assist management’s operations. These include models of game theory. Game theoretic solution concepts are based on different argumentations, from which follow different properties and—different results. From the viewpoint of management accounting, the question arises whether these allocation schemes are suitable for solving corporate cost allocation problems. Therefore, this paper provides a detailed literature review of the crucial properties of some well-known solution concepts. This serves as the basis for the evaluation of these solutions with respect to management accounting purposes.