On Tue, 05 Aug 2003 16:40:13 GMT, Bert Craig wrote:

Enforcement? Where's the beef?! Oh, it went to pay for that $400 hammer or
that $1,200 barracks toilet bowl.

Well, it's time to drag out Project Accounting 101 again. As I
posted elsewhere (with apologies to the CPAs and EAs if I used
incorrect terminology as to the accountimne methods in the
example):

The scoffers fail to remember (or understand) that the "$500
hammer" came about by allocation of contract overhead by line
item rather than by proportional item cost....

Follow the bouncing ball for a machine and a hammer needed to
maintain it:

Machine catalog cost = $ 10,000.00
Hammer catalog cost = $ 10.00
Total cost of material = $ 10,010.00
10% Contract overhead = $ 1,001.00
Total contract cost = $ 11,011.00

By Proportional Item Cost allocation method, overhead is allocated
proportionally:

Machine cost = $ 10,000 + 10% = $ 11.000
Hammer cost = $ 10 + 10% = 11
Total cost = $ 11,011

By Line Item allocation method, the total overhead is divided by
the number of line items, in this case 2:

Machine cost = $ 10,000 + $ 500.50 = $ 10,500.50
Hammer cost = $ 10 + $ 500.50 = $ 510.50
Total cost = $ 11,011.00

Note the "$ 500 hammer" in the example above !!

Same hammer, same contract cost, no extra charge for the asinine
comments by The Congress and The Press and The Critics.

As to where the enforcement money went, the nickle-nursers in The
Congress never appropriated it, and even if they would have, the past
three agency chairmen - the folks who have the power to allot the
funds inside the agency - had neither regard for nor understanding of
the need for field enforcement.

And that takes care of that.......

--
73 de K2ASP - Phil Kane