The Army identified a need for 800 thermal viewers in February 2012. Two million dollars were made

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Question:

The Army identified a need for 800 thermal viewers in February 2012. Two million dollars were made available in FY2012 funds for the procurement. The Army negotiated a fixed-price-redeterminable contract with Acme to manufacture the viewers in July 2012, but only for a quantity of 500, because the anticipated price per viewer was projected at $4,000. In April 2015, Acme delivers the 500 viewers, but has been able to achieve significant cost savings and has manufactured the viewers for a total contract price of $1.5 million, including Acme's profit. Before the modification is executed reducing the contract price to $1.5 million, Acme proposes to manufacture the additional 300 thermal viewers for $500,000, using the obligated but unexpended balance of the FY2012 funds. Which statement is true about this scenario?

Since only 500 were put under contract, the $500,000 in unexpended FY2012 funding may be used to acquire the additional 300 thermal viewers.

Even though the FY2012 funds are now expired, it may be used to fund any change or modification to the contract.

$2,000,000 was obligated for thermal viewers, and the entire amount may be expended for that purpose.

A modification in FY2015 for an additional 300 viewers is a new procurement which must be funded with funding available for obligation in FY2015.