Lesson Objectives

You are beginning Lesson 5: Cost Allocation. After completing this lesson, you will be able to determine if the contractor accounts for costs in accordance with the requirements of Cost Accounting Standard (CAS) 403, CAS 410, CAS 420, and CAS 418.

The lesson objectives are:

• Given a CAS-covered contract, determine if the contractor has allocated home office expenses to segments in accordance with the requirements of CAS 403.
• Given a CAS-covered contract, determine if the contractor has allocated business unit general and administrative (G&A) expenses to final cost objectives in accordance with the requirements of CAS 410.
• Given a CAS-covered contract, determine if the contractor has accounted for Independent Research and Development and Bid and Proposal costs (IR&D/B&P) in accordance with the requirements of CAS 420.
• Given a CAS-covered contract, determine if the contractor has allocated direct and indirect costs in accordance with the requirements of CAS 418.

Lesson Topics

You will be learning about the following topics in Lesson 5:

• CAS 403: Allocation of Home Office Expenses to Segments
• CAS 410: Allocation of Business Unit General and Administrative (G&A) Expenses to Final Cost Objectives
• CAS 420: Accounting for Independent Research and Development (IR&D) Costs and Bid and Proposal (B&P) Costs
• CAS 418: Allocation of Direct and Indirect Costs