Cost Analysis Chapter 1

Question 1

Appropriation

Answer 1

Grants budget authority to be obligated

Question 2

Budget Authority

Answer 2

Permission to obligate a future outlay; credit card spending limit

Question 3

Obligation

Answer 3

Legally binds for an expenditure; purchasing an item with the credit card.

Question 4

Expenditure

Answer 4

electronic funds transfer or check

Question 5

Responsible for preparing the life cycle cost estimate

Answer 5

Program Manager

Question 6

Three ways to group LCC of a program

Answer 6

Funding Appropriation Categories, WBS, and Life Cycle Cost Categories

Question 7

Appropriation categories include:

Answer 7

RDT&E, Procurement, O&M, MILCON, MILPERS, and the stakeholders include Congress, Comptroller, and Component Controllers

Question 8

DoD 5000.4 defines 3 categories:

Answer 8

R&D, Investment, and O&S, (Disposal)

Question 9

Program Acquisition Cost includes:

Answer 9

Development Cost, MILCON, Procurement

Question 10

Procurement Cost includes:

Answer 10

Weapon System Cost and Initial Spares

Question 11

Weapon System Cost includes:

Answer 11

Flyaway Cost (Prime Mission Equipment and Support Items)

Question 12

Life Cycle Costs include:

Answer 12

Program Acquisition Cost and O&S Cost and Disposal Cost

Question 13

Total Ownership Cost

Answer 13

includes the elements of life cycle costs as well as the indirect costs.

Question 14

Operating and Support Cost

Answer 14

includes costs for supplies and maintenance for a system once it is fielded.

Question 15

Analysis of Alternatives answers

Answer 15

What is the most cost effective way to meet this mission need?

Question 16

DoD 5000.4 provides

Answer 16

Cost Estimates and Cost Analyses

Question 17

Component Cost Estimate

Answer 17

Cost estimate prepared by a component independently from the program office

Question 18

DCAPE

Answer 18

Director of Cost Assessment and Program Evaluation

Question 19

Economic Analysis

Answer 19

prepared by the program office for ACAT 1A programs at Milestone B.

Question 20

CARD

Answer 20

The program management office is responsible for preparing the CARD

Question 21

The ACAT 1D program require:

Answer 21

POE, CCE, and ICE

Question 22

The ACAT 1C require:

Answer 22

POE and the ICE

Question 23

The ACAT 1AM require:

Answer 23

EA and CCE

Question 24

CARD

Answer 24

Cost Analysis Requirements Description

Question 25

Component Cost Agency

Answer 25

prepares the CCE for ACAT 1C programs

Question 26

FM&C, Assistant Secretary

Answer 26

reviews the CCE and POE for errors, and reconciles them into a Component Cost Position.

Question 27

Component Head

Answer 27

responsible for ACAT 1 program, designates an independent activity to prepare the AoA

Question 28

Principal Staff Assistant

Answer 28

responsible for ACAT 1A program, designates an independent activity to prepare the AoA

Question 29

DCAPE prepares

Answer 29

the ICE for all ACAT 1D programs

Question 30

The four methods to develop cost estimates

Answer 30

Analogy, Parametric, Engineering, Actual Costs

Question 31

Activity Based Costing

Answer 31

measures costs across an organization without regard to functional boundaries

Question 32

Analysis of Alternatives

Answer 32

a quantitative analysis of risks, uncertainty, and relative advantages