The Jones Manufacturing Company is competing for a production contract that requires that work…

The Jones Manufacturing Company is competing for a production contract that requires that work begin in January 2003. The cost package for the proposal must be submitted by July 2002. The business base, and therefore the overhead rates, are uncertain because Jones has the possibility of winning another contract, to be announced in September 2002. How can the impact of the announcement be included in the proposal? How would you handle a situation where another contract may not be renewed after January 2003, i.e., assume that the announcement would not be made until March?

 

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