A working example

Ceiling Back-Out, Cost Share & Burn Rate

Back out MTDC & F&A from a total-cost ceiling

When a funding announcement caps Total Costs, subtract MTDC exclusions first, then divide the remaining ceiling by (1 + F&A rate).

Total award ceiling (USD)

F&A rate (%)

MTDC exclusions (USD)

Equipment, tuition remission, participant support, or subaward amounts over the cap.

Basis and sources

Source review: October 25, 2026. These three formulas cover the quantitative calculations tested in Domain 1 and Domain 3 of the CRA® and CFRA examinations.

2 CFR 200.1 (Modified Total Direct Cost): Exclusions removed before backing out or applying an F&A rate.
2 CFR 200.306 (Cost sharing): Mandatory vs. voluntary cost sharing and valuation rules.
2 CFR 200.302 (Financial management): Comparing outlays with budget amounts across the period of performance.