Abstract
The problems of costing, and pricing periodic demands for services, known as the peak load problem, has been widely studied, with relatively little success, largely within the framework of the marginal costing approach of micro-economics. The paper reports the application of a new method called Multiple-Service Costing, to the internal fixed cost allocation procedures within an airline. This new method of allocating the fixed costs of services, to the demands, is based on considering the interacting system of supply and demand as a whole. An illustrative example of the method applied to charging computer time is described. The actual use of the method in an airline, for the calculation of flight check-in charges is reported.
*Now at the Polytechnic of Central London.
*Now at the Polytechnic of Central London.