TapRun Consulting

Point of Total Assumption Calculator

Answers the Question

At what point on a fixed-price plus incentive fee contract will the vendor be responsible for all overruns?

Calculator for Point of Total Assumption

 

What Is the Point of Total Assumption?

Many companies use a type of contract that is fixed price with incentives for efficient delivery. Should the vendor incur small overruns, they will bear at least part of the cost. At some point (the point of total assumption), however, the vendor will be deemed responsible to bear the entire cost of any additional overruns.

Why Is it Important?

Formula(s) to Calculate Point of Total Assumption

Common Mistakes

Additional Business & Financial Calculators Available