Paper 3 Assignment POST NEGOTIATION MEMORANDUM Adams Alexander Dawn

Topics: Cost accounting, Costs, Cost Pages: 4 (864 words) Published: February 15, 2015
POST NEGOTIATION MEMORANDUM (Federal Acquisition Regulation, [FAR], 2014). Jottemdown Manufacturing Inc.
701 Scholastic Road
Allbeoversoon, MD 21344
Contract No. W56HZV-14-R-0092
Stinger Tracking System Program
Case No. 9268

1. Introductory Summary: Negotiations were concluded on 22 November 2014 for delivery order 700801-92 on Contract No. W56HZV-14-R-0092. This CPFF delivery order provides for the development and delivery of 100 Seekers for the Stinger Tracking System Program over the span of 24 months.

2. Cost Analysis and Evaluation of Proposed Costs:
Analysis of Direct Labor Costs: (Murphy, 2009, Chapter 6)
Analysis of Direct Material and Other Direct Costs: (Murphy, 2009, Chapter 7) Analysis of Indirect Costs (Murphy, 2009, Chapter 8)

3. Direct and Indirect Rates: Below is a comparison of JMI’s proposed direct, indirect costs and rates, as well as the negotiated costs after the FAA’s team of financial subject matter experts (SMEs) requested technical breakdowns of the proposed costs as they relate to the direct, indirect, and other direct costs follows: (FIND SOMETHING TO CITE THAT MENTIONS BASES AND POOLS) and then mention it in reference to the figures below.

Direct Costs
Fee Rate
Proposed
Negotiated
Direct Material Sched A

$2,200,000.00

Direct Labor Sched B

$3,220,000.00

Subcontracts Sched C

$4,530,000.00

Other Direct Costs Sched D

$78,950.00

Total Direct Costs

$10,028,950.00

Indirect Costs

Labor Overhead Sched E

$3,384,986.00

Material Overhead
7.00%
$154,000.00

Subcontract Overhead
1.35%
$61,155.00

Total Cost Input

$13,629,091.00

G&A
7.00%
$954,036.37

Total Cost

$14,583,127.37

COM Sched F

$3,579.48

FFP Profit
20.00%
$2,916,625.47

Total Price

$17,503,332.32

In accordance with Table 15-2 of FAR 15.408 JMI was asked to produce supporting records for their projected direct labor costs to...

References: Army Contracting Agency. (May 2004). Prenegotiation Objective Memorandum (POM) & Price Negotiation Memorandum (PNM) Guide. Retrieved from http://www.acq.osd.mil/
Federal Acquisition Regulation. Retrieved from http://www.acquisition.gov
Lamance, K., (July 7, 2012). Legal Match: Cost Plus Fixed Fee Contracts
Retrieved from http://www.legalmatch.com/law-library/article/cost-plus-fixed-fee-contracts.html
Murphy, J. (2009). Guide to contract pricing: Cost and price analysis for contractors, subcontractors, and Government agencies (5th Ed.). Vienna, VA: Management Concepts
Federal Acquisition Regulation [FAR] (Amended Nov. 13, 2014). Retrieved from http://www.acquisition.gov
STOLEN NOTES FROM:
ACQ Web. Office of the Under Secretary of Defense for Acquisitions, Technology and Logistics. Retrieved from http://www.acq.osd.mil/dpap/cpf/docs/contract_pricing_finance_guide/vol3_ch7.pdf
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