What approach would we want to use if we wanted to use a ‘relative percentage of direct costs’ for our costs?

When considering shared costs we know that there are three main ways to accomplish this according to the FinOps Foundation.

What approach would we want to use if we wanted to use a ‘relative percentage of direct costs’ for our costs? (Select One)
A . Fixed
B. Proportional
C. Odd Split
D. Even Split

View Answer

Answer: B

Explanation:

Proportional

There are typically three ways to split up shared costs:

Proportional: Based on relative percentage of direct costs

Even split: Split total amount evenly across targets

Fixed: User-defined coefficient (the sum of coefficients needs to be 100%)

This page here is perhaps one of the most important pages to review and understand before the exam. Identifying Shared Costs