[Code of Federal Regulations]
[Title 48, Volume 1]
[Revised as of October 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 48CFR31.201-4]

[Page 585]
 
            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
              (This book contains chapter 1, parts 1 to 51)

                CHAPTER 1--FEDERAL ACQUISITION REGULATION
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PART 31_CONTRACT COST PRINCIPLES AND PROCEDURES--Table of Contents
 
          Subpart 31.2_Contracts With Commercial Organizations
 
Sec. 31.201-4  Determining allocability.

    A cost is allocable if it is assignable or chargeable to one or more 
cost objectives on the basis of relative benefits received or other 
equitable relationship. Subject to the foregoing, a cost is allocable to 
a Government contract if it--
    (a) Is incurred specifically for the contract;
    (b) Benefits both the contract and other work, and can be 
distributed to them in reasonable proportion to the benefits received; 
or
    (c) Is necessary to the overall operation of the business, although 
a direct relationship to any particular cost objective cannot be shown.