00indirect costs labor overhead sched e B u s i n e s s F i n a n c e

00indirect costs labor overhead sched e B u s i n e s s F i n a n c e

Jottemdown Manufacturing Inc., (JMI) submitted a Firm Fixed Price Proposal to the Federal Affairs Agency (FAA) to build 20 Seekers for the Stinger Tracking System (STS). JMI is a world leader in the Seeker business and has delivered over 100 of these crucial items. The Seekers must be delivered 24 months after receipt of order.

After a series of “all nighters,” JMI and the FAA negotiators have agreed to finally settle, based on the Cost Summary Detail provided below, except the final agreement is for a Cost Plus Fixed Fee (CPFF) award, from JMI’s originally proposed Firm Fixed Price.

Your job, in Paper #3, is to officially close negotiations by writing a Post Negotiation Memorandum (PNM) to provide a descriptive summary of the final Cost Summary details and structure of the settlement with your organization (JMI) and the FAA.

The descriptive summary should concentrate on, but not be limited to, framing the following:

Describe the execution of the negotiation process with explicit emphasis on cost analysis techniques that would have been considered in evaluating the proposed direct labor, materials, and ODCs.

Direct and Indirect Rates.

Subcontractor evaluation and selection.

Structured approach to the final negotiated profit.

Protocol for Confirmation of Negotiations letter.

TINA Compliance in the Post negotiation sweep.

Cost Summary Detail for JMI Seekers (going into final negotiations)

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

Your Paper 3 should explicitly cover the requirements above, and should be a thematic, coherent, and relevant chronology, with smooth transitions.

In all cases, provide SUPPORT for your theme with minimum, but sufficient and convincing detail for implementation.

YOU MAY SUBMIT AN ATTACHMENT IN WORD OR PDF ONLY. Use Headings for your major points and readability. You are expected to observe APA guidelines for sources when applicable.

DO NOT SUBMIT A PAPER THAT IS ONE CONTINUOUS PARAGRAPH. Rather, keep your thoughts organized by placing a space between paragraphs, and NUMBER YOUR RESPONSES to highlight the requirements.

Your total response should be the equivalent of 3-4 typed, double-spaced pages (plus or minus ten percent).