1Z0-1160-1 practice question 5 of 10

Which two capabilities of the Project Cost to Accounting process help in managing the indirect cost on projects?

Full set: 53 questions
Answer options
A: Calculation Manager helps transfer balances from a source account to target accounts
B: Burdening provides the aggregate of raw and burden costs to represent the total cost of doing business accurately Correct answer
C: Allocation helps distribute actual amounts from project sources, ledger sources, or fixed amounts to target projects Correct answer
D: Capital Events helps group assets and costs on a project
Correct Answer:
B. Burdening provides the aggregate of raw and burden costs to represent the total cost of doing business accurately; C. Allocation helps distribute actual amounts from project sources, ledger sources, or fixed amounts to target projects
Explanation

In the Project Cost to Accounting process within Oracle Project Portfolio Management, managing indirect costs accurately is vital for determining true total project expenditures. Burdening allows organizations to calculate overhead and indirect costs (such as fringe benefits, administrative expenses, and facilities overhead) and add them to raw costs, accurately representing the fully burdened cost of doing business. Additionally, Allocation capabilities enable the distribution of actual cost amounts from General Ledger accounts, project pools, or fixed amounts to specific target projects and tasks based on predefined allocation rules. Together, burdening and allocations provide robust mechanisms for managing, distributing, and accounting for indirect costs on projects.

Why Incorrect

A. Calculation Manager is used in Oracle EPM and GL for allocating account balances, not for project indirect cost accounting in PPM.
D. Capital Events are used to group project assets and costs specifically for capitalization in capital projects, not for managing project indirect costs.

References

Oracle Fusion Cloud Project Costing Guide: Accounting for Project Costs, Section: "Project Indirect Costs: Burdening and Allocations".

Oracle Project Portfolio Management Cloud Guide: Financial Structures and Cost Allocation Rules, Chapter 4: "Burden Schedule and Allocation Setups".

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