TITLE 48 - FEDERAL ACQUISITION REGULATIONS SYSTEM
CHAPTER 1 - FEDERAL ACQUISITION REGULATION
SUBCHAPTER E - GENERAL CONTRACTING REQUIREMENTS
PART 31 - CONTRACT COST PRINCIPLES AND PROCEDURES
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.