Pricing of Northrop Corporation Contract F33657-74-C-0041

A fixed-price incentive contract awarded to a corporation for development of two F-5F aircraft was examined to determine the reasonableness of the contract price in relation to supporting cost data and whether legislative requirements were implemented. The contract included a clause which permits the contracting officer to reduce the contract price if it was increased by a significant sum because the certified cost or pricing data was not current, complete, and accurate.