You have a CPIF contract with a target cost of $3,125,000 and a target fee of $156,250. The associated clause states… “(e) Fee payable (1) The fee payable under this contract shall be the target fee increased by 15 cents for every dollar that the total allowable cost is less than the target cost or decreased by 20 cents for every dollar that the total allowable cost exceeds the target cost. In no event shall the fee be greater than 7 percent or less than 2 percent of the target cost.” Given a final cost of $2,750,000 determine the final fee and the final contract funding.. Single choice.
You have a CPIF contract with a target cost of $3,125,000 and a target fee of $156,250. The associated clause states… “(e) Fee payable (1) The fee payable under this contract shall be the target fee increased by 15 cents for every dollar that the total allowable cost is less than the target cost or decreased by 20 cents for every dollar that the total allowable cost exceeds the target cost. In no event shall the fee be greater than 7 percent or less than 2 percent of the target cost.” Given a final cost of $2,750,000 determine the final fee and the final contract funding.. Single choice.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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You have a CPIF contract with a target cost of $3,125,000 and a target fee of $156,250. The associated clause states… “(e) Fee payable (1) The fee payable under this contract shall be the target fee increased by 15 cents for every dollar that the total allowable cost is less than the target cost or decreased by 20 cents for every dollar that the total allowable cost exceeds the target cost. In no event shall the fee be greater than 7 percent or less than 2 percent of the target cost.” Given a final cost of $2,750,000 determine the final fee and the final contract funding.. Single choice.
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