Your program has an RDT&E-funded project scheduled to start in July 2005 which is expected to take 12 months to complete. The project is expected to cost a total of $12 million (then-year dollars), with cost expected to be incurred at a rate of $1 million per month. The services to be provided under this project are severable. Which two of the following are appropriate budget requests for this project? (There are TWO correct answers here.)
$3 million for FY05 and $9 million for FY06
$12 million for FY05 and $0 million for FY06
$12 million for FY04 and $0 million for FY05
$3 million for FY04 and $9 million for FY05
12 millionFY05 and 3 Million FT05
$3million for FY05(July, Aug, & Sep) and then $9million for FY06(Oct-June)because the NEW FY starts in Oct of every year.
To determine the appropriate budget requests for the project, we need to consider the project start date, duration, and cost allocation.
From the given information:
- The project is scheduled to start in July 2005 and is expected to take 12 months to complete.
- The total cost of the project is $12 million (then-year dollars), with a monthly cost of $1 million.
Now, let's analyze the options based on these factors:
1) $3 million for FY05 and $9 million for FY06
- This option disburses $3 million in the first fiscal year (FY05) and $9 million in the second fiscal year (FY06). However, we need to ensure that the cost incurrence aligns with the project timeline. Starting in July 2005 and lasting for 12 months, the project would end in June 2006. Therefore, the majority of the project cost ($9 million) would be incurred in FY06, making this option a valid choice.
2) $12 million for FY05 and $0 million for FY06
- This option suggests allocating the entire project cost of $12 million in FY05. Since the project lasts for 12 months, it would end in June 2006. If the entire budget is requested in the FY05, it corresponds to the project timeline.
3) $12 million for FY04 and $0 million for FY05
- This option suggests allocating the entire project cost of $12 million in FY04. However, the project is scheduled to start in July 2005, so it is not appropriate to request the entire budget a year before the project's scheduled start date. Therefore, this option is not valid.
4) $3 million for FY04 and $9 million for FY05
- This option disburses $3 million in FY04 and $9 million in FY05. However, the project is scheduled to start in July 2005, making it inappropriate to request funding in FY04. So, this option is not valid.
Considering the above analysis, the two appropriate budget requests for this project are:
- $3 million for FY05 and $9 million for FY06
- $12 million for FY05 and $0 million for FY06