PTA
Submitted by Fariba on Tue, 06/04/2013 - 00:02
You are running a project for a customer based on a cost-reimbursable contract with the following terms:
Target costs: $ 1,000,000
Fixed fee: $ 100,000
Benefit/cost sharing: 80% / 20%
Price ceiling: $ 1,200,000
Which is the PTA (= point of total assumption, break point) of the project?
a) $1,300,000
b) $1,500,000
c) $80,000
d) $1,125,000
Forums:
sandeshkd
Tue, 06/04/2013 - 02:06
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Answer D
Target Cost (TC) = $1,000,000
Target Fee (TF) = $100,000
Target Price (TP) = TC + TF = $1,100,000
Ceiling Price (CP) = $1,200,000
Benefit/cost sharing = 80%/20%
Buyer Share (BS) = 80%
PTA = ((CP - TP) / (BS)) + TC
= ((1,200,000 - 1,100,000)/0.8) + 1,000,000
=1,125,000
suwaidk
Sat, 06/08/2013 - 20:58
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How do you select 80% or
How do you select 80% or 20%?? For seller cost sharing is 20% right.
Fariba
Tue, 06/04/2013 - 03:06
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Answer is D
You are correct.