Cost plus incentive fee contract calculation
Submitted by falcios on Tue, 08/06/2013 - 03:16
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How would you find the solution for this question?
Your company has a cost plus incentive fee contract with a vendor. The target cost is $150,000. The target fee is $20,000, and the share ratio between buyer and vendor is set at 80/20. The maximum fee is $30,000 and the minimum fee is $5,000. If the actual cost is $190,000, what fee does your company have to pay the vendor?
Thanks for the help
