PS - Tutor can take 40+ mins in solving this. Jelly is the buyer and proposes to Peanutbutter the seller that they use a Firm Fixed Price Contract for the sandwich procurement. The sandwiches are a critical project deliverable for Jelly's promotional event that expects 20, 000 (+100%/-50%) attendees. Jelly and Peanutbutter agree to the following conditions: $30,000 CAD fixed price for the ingredients, production and serving of a maximum of 40,000 sandwiches. Jelly and Peanutbutter have a good buyer seller relationship, so they include a clause in the contract that will allow for contract renegotiation up to 1 week before the event. Peanutbutter's total cost to make each sandwich is $1. 1. If 35,000 sandwiches are served at the event, what will Peanutbutters profit be?

2. What will Jelly pay if 35, 000 sandwiches are served?

3. What will Peanutbutter's profit be if 15,000 sandwiches are served?

4. What will Jelly pay if 15, 000 sandwiches are served? 5. At what number of sandwiches served will Peanutbutter's risk of a loss materialize? Jelly was late for class one day because of long lineups at the coffee shop and decided that attendees at the event should not experience long waits for sandwiches, so an incentive was negotiated into the contract. For every sandwich that is served in under 2 minutes an additional $0.50CAD will be added to the fixed fee. Note: the contract has changed to a Fixed Price Incentive Fee contract. 6. What would Peanutbutter's profit be if 20,000 sandwiches are served in over 2-minutes and 10,000 are served in under 2 minutes? Peanutbutter noticed that the prices of ingredients have been increasing at a rate of 1.25% quarterly, a concern that if the event date is changed, a greater risk of loss could be introduced. To address the increased risk, Peanutbutter negotiated a 1.25% per quarter of +/- change (delayed + 1.25%, earlier -1.25%), if the event date is changed. The current planned date for the event is April 30, 2022. Note: the contract has changed to a Fixed Price with Economic Price Adjustment contract. 7.What would the total fee be if the event date was changed to April 30, 2023, and 30,000 sandwiches are served in under 2 minutes (serving sandwich in under 2-minutes incentive $0.50is still valid. No Economic adjustment on incentive)? 8. What would the total fee be if the event date was changed to April 30, 2021, and 30,000 sandwiches are served in under 2 minutes (serving sandwich in under 2-minutes incentive $0.50is still valid. No Economic adjustment on incentive)? Toast is the beverage supplier and will charge $0.15CAD per bottle of water, $0.05 for per bottle of soda and $0.10 per bottle of Juice. A purchase order will be used to procure the beverages. 9. If Jelly decides on 20,000 bottles of water, 15,000 bottles of soda and 10,000 bottles of juice what will the PO amount be if delivery and taxes are already included in Toast's price?

Peanutbutter and Jelly are starting to have concerns that the number of attendees is not certain, so they negotiate a Cost Plus Fixed Fee contract to address this concern. They agree on a fixed fee of 29% of the actual cost and a 5% of cost incentive for every sandwich served in under 2-minutes. 10. If 15,000 sandwiches are served in under 2-minutes and 10,000 sandwiches served in over 2-minutes on April 30, 2022, what will Peanutbutter's total fee be without cost?

11. Based on the fees paid in question 10, what is the total payment that Jelly will pay to Peanutbutter?

The relationship Peanutbutter and Jelly have is important to them, so they decided to share the risk by using a deferent Cost Plus Fixed Fee contract. They agree on a target cost of $25,000 plus a target fee of 7,000. They will have a 60/40 percent buyer/seller shared responsibility for overruns and underruns. If the procurement actual cost is $29,000CAD. 12. Is it an overrun or an underrun and by how much?

13.What is Peanutbutter's fee?

14. What is Jelly's total payment for this procurement?