Supply Chain Glossary - A

Supply Chain Glossary - A

allowable cost

A reasonable cost specifically permitted under the Federal Acquisition Regulations (FAR).

1) In work measurement, a time value or percentage of time by which the normal time is increased, or the amount of nonproductive time applied, to compensate for justifiable causes or policy requirements that necessitate performance time not directly measured for each element or task. Usually includes irregular elements, incentive opportunity on machine-controlled time, minor unavoidable delays, rest time to overcome fatigue, and time for personal needs. 2) In assembly, the minimum clearance or maximum interference distance between two adjacent objects.


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