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### CPIF

Posted: Fri Aug 22, 2014 11:34 am
Q2:Given are the statistics for a Project. Target Cost = \$150,000; Target Fee = \$30,000; Target
Price = \$180,000; Sharing Ratio = 60/40; Ceiling Price = \$200,000; Actual Cost = \$210,000.
Calculate the Fee and the Final Price for the project
a) Fee = \$30,000, Final Price = \$210,000
b) Fee = \$30,000, Final Price = \$200, 000
c) Fee = \$6,000, Final Price = \$200, 000
d) Fee = \$6,000, Final Price = \$240,000

### Re: CPIF

Posted: Fri Aug 22, 2014 11:53 am
i have understood the question i just missed a simple step but when i read that again i got the answer

Sometimes this happens

### Re: CPIF

Posted: Sat Aug 23, 2014 6:14 am
This is very important trick to handle for actual exam also .. specially after first hour of exam

### Re: CPIF

Posted: Mon Dec 12, 2016 6:23 am
Calculation for Actual Fee/Profit:
Given figures ,
Target Cost = \$150,000
Target Profit \$30,000
Actual Cost = \$210,000
Target Fee = \$30,000
So , Savings amount due to Cost under run \$150,000- \$210,000= - \$ 60,000
Profit Sharing Ratio = 60:40
So, Sellers share = 0.40 * (- \$ 60,000)=- \$ 24,000
Therefore, Actual Profit = \$30,000- \$ 24,000 = \$ 6,000
Ceiling Price = \$200,000
Final price is ceiling price = \$200,000

Therefore the correct answer is c.

could you please confirm if the calculation and option c is right?

### Re: CPIF

Posted: Mon Dec 12, 2016 6:58 am
yes thats correct