Calulation Based Question

Submitted by munishmsh on Sat, 08/06/2011 - 07:01

Hi



Would you please let me know how to do the calculation for the below question.


A Cost-plus incentive fee contract has the following contract elements Target cost = $10,000,000 Target Profit = $800,000 Optimistic Cost = $8,000,000 Optimistic Profit = $1,000,000 Pessimistic Cost = 12,000,000 Pessimistic Profit= $1,600,000 If the seller completes the project at an actual cost of $10, 200,000, what is the overall price for the buyer if the over-run share ratio is 60/40?











 


Regards
Msh

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munishmsh

Sat, 08/06/2011 - 07:17

Here goes one more


You are performing variance analysis on the material used in the project. What is the usage variance for the following? Budgeted price per unit =$200 Actual Price per unit=$250 Budgeted Quantity=250 Actual Quantity=225










Deepti

Sat, 08/06/2011 - 17:03

Hey Manish 

 

What's the answer for both the q..

 

I think it's c for both i.e. 1092, and -6250..

munishmsh

Sat, 08/06/2011 - 22:50

Hey Deepti


its c and a. would you please explain atleast first answer.

Deepti

Sun, 08/07/2011 - 03:26

Actual cost + Target Profit - (Actual cost- Target Cost) * 40%

I believe this optimistic and pessimistic stuff is extra data...