Question 2: The Robinson-Patman Act: (a) Forbids price reductions (b) Does not forbid discriminatory and preferential prices (c) Does not allow a firm to meet an equally low price (d) Applies to sales to the Government (e) Does not apply to sales to the Government

Question 3: Average cost pricing: (a) Is the only accurate pricing technique (b) Distinguishes clearly between cost and price (c) Is considered scientific pricing (d) Is an arbitrary allocation of cost (e) Reflects competition adequately

Question 4: The primary objective of is to provide information that is needed to run a business effectively. (a) Financial accounting (b) Managerial accounting

Question 5: taxes are allowable. (a) Federal income (b) State and local income (c) Special assessments on land which represent capital improvements (d) Excess profit (e) None of the above

Question 6: A cost is allocable to a government contract if: (a) It is necessary to the overall operation of the business (b) It is incurred specifically for the contract (c) It benefits the contract (d) All of the above (e) None of the above

Question 7: estimating has the advantage of speed of application and is relatively inexpensive. (a) Round table (b) Comparison (c) Detailed

Question 8: Commercial firms are strong in: (a) Estimating costs for the development of new items (b) Control of product design (c) Estimating manufacturing costs when new items are placed in production (d) All of the above (e) None of the above

Question 9: Indirect factory labor usually includes: (a) Foremen (b) Superintendents (c) Maintenance and stockroom personnel (d) All of the above

Question 10: In Government contracting, the purchases supplies and services from responsible sources at fair and reasonable prices. (a) Field pricing specialist (b) DCAA auditor (c) Should cost team captain (d) Contracting officer (e) None of the above

Question 11: The primary objective of a cost breakdown is: (a) To obtain data for evaluating the probable cost of performance of a given contract (b) It places the contractor on notice that its costs will be analyzed (c) It acts as a negotiating tool for the buyer (d) All of the above

Question 12: refers to the development of cost estimates by using cost estimating relationships. (a) Parametric cost estimating (b) Round table estimating (c) Estimating by comparison (d) Detailed estimating

Question 13: When a cost is readily identifiable with the product and important enough to merit identification and measurement, it is considered a(n): (a) Direct cost (b) Indirect cost

Question 14: Which of the following statements about price index construction is untrue? (a) Price index numbers are price relatives, usually expressed as percentages (b) The selection of a base period is usually an arbitrary process (c) In constructing price index numbers, it is important to express a price in dollars for measure of quantity (d) A single simple index number will often suffice for pricing purposes

Question 15: The first step in developing a cost estimating relationship is: (a) Gathering data (b) Exploring the relationship between the independent and dependent variables (c) Designating and defining the dependent variable (d) Predicting the independent variable

Question 16: Contracts for are exempted from the Walsh-Healey Public Contracts Act. (a) Perishables, including dairy, livestock, and nursery products (b) Agricultural or farm products processed for first sale by the original producers (c) Public utility services (d) Supplies manufactured outside the United States, Puerto Rico, or the Virgin Islands (e) All of the above

Question 17: Contractors which account for specifically identifiable units generally use a accounting system. (a) Job order cost (b) Process cost (c) Average cost (d) Financial cost

Question 18: Which of the following statements about direct materials is untrue? (a) The contractor may use a statistical approach, a grass roots approach, or some combination of both to estimate material costs (b) A final product must contain a basic minimum quantity of materials equal to the quantity required by the specifications (c) Scrap is avoidable (d) Raw materials are estimated by comparison with similar pieces whenever possible (e) None of the above

Question 19: is a method used to estimate and display direct material costs. (a) Statistical estimate (b) A priced bill of materials that purports to develop the average unit material costs for the procurement (c) A projection of the average material cost per unit on a preceding lot or contract (d) All of the above

Question 20: A is a quantity of parts that a contractor receives and pays for at one time. (a) Purchase lot (b) Production lot (c) Neither of the above

Question 21: Which of the following engineering efforts are nonrecurring? (a) Initial design development (b) Writing procedures (c) Reviewing schedules and manufacturing methods (d) Organizing work stations (e) None of the above

Question 22: The danger of the approach to analyzing an engineering estimate is that it tends to perpetuate cost levels without regard for whether the contributing expenditures were reasonable and necessary. (a) Task (b) Ratio of support (c) Availability (d) Learning curve (e) Production engineering ratio

Question 23: Which of the following statements concerning complexity is untrue? (a) The complexity factor should be applied to labor estimates developed from labor standards (b) Complexity factor can be considered a factor applied to labor estimates (c) Product complexity differs from product newness only in degree (d) Sometimes contractors compensate for complexity by simple addition to the technical support estimate (e) None of the above

Question 24: Tooling does not include: (a) Jigs (b) Dies (c) Fixtures (d) Small hand tools (e) None of the above

Question 25: Preproduction (start-up) costs are usually treated as charges. (a) Direct (b) Indirect

Question 26: is test equipment that can be used for more than one contract and charged to overhead. (a) Capital or general purpose equipment (b) Special test equipment

Question 27: are those costs beyond the development phase to introduce new systems or a new capability into use. (a) Research and development costs (b) Investment costs (c) Operations

Question 28: are essentially insensitive to the number of units that will be produced. (a) Research and development costs (b) Investment costs (c) Operations

Question 29: The first order of business in the parametric pricing of a program is: (a) Developing technical baselines (b) Selecting a data base (c) Definition of overall program requirements, interfaces, scope, and definition (d) Developing grass roots estimates

Question 30: Which of the following best describes indirect costs? (a) Costs which are incurred for the benefit of two or more cost objectives (b) Costs which do not benefit Government contracts (c) Costs which are impractical to trace to a specific cost objective (d) (a) and (c) both describe indirect costs

Question 31: Distributed overhead costs are: (a) Costs related to outgoing freight (b) Costs incurred for the benefit of two or more primary cost pools (c) Costs which cannot be related to any cost objective (d) Costs which can be attributed to one primary indirect cost pool

Question 32: In indirect cost analysis, the break-even point is that point at which: (a) There is no over or under application (absorption) of indirect costs (b) Fixed and variable costs are fully recovered (c) Actual indirect costs equal standard indirect costs (d) Total revenue equals total cost

Question 33: Material overhead includes costs related to: (a) Depreciation (b) Insurance (c) Unemployment taxes (d) Transportation (incoming) (e) All of the above

Question 34: A contractors profit percentage estimated for a specific contract will result in actual profit: (a) Seven out of ten times (b) Three out of ten times (c) Only if all assumptions made with reference to a specific contract and all other contracts during a particular period are realized (d) If he uses the new weighted guidelines method

Question 35: There is no limitation imposed by statute or regulation on profit negotiated on contracts. (a) Fixed price (b) Cost-type

Question 36: CAS establishes criteria for measuring and allocating, as an element of contract cost, the cost of capital committed to facilities used on a contract. (a) 411 (b) 412 (c) 414 (d) 415

Question 37: (e) The 417 requirement for submission of cost or pricing data by the prime contractor extends to: (a) Only the prime contractors in-house work (b) The first tier subcontractors (c) All tiers of subcontractors (d) The first and second tier subcontractors

Question 38: The prime contractor will normally be required to submit cost data on each subcontract item from: (a) All potential subcontractors (b) The subcontractor most likely to be selected (c) The subcontractor offering the best technical proposal (d) Those subcontractors with whom the prime contractor has had previous experience

Question 39: The purpose of post award audits of firm fixed price contracts is to determine: (a) Whether or not defective cost or pricing data was submitted (b) Profit-cost relationships (c) Whether contingencies cited by the contractor materialized (d) All of the above

Question 40: If a subcontractor accepts an indemnification clause which provides that he is liable to the prime contractor for any reduction in the prime contract price arising out of defective data which he furnishes, the clause should contain provisions which: (a) Provide the subcontractor with a method of appeal (b) Disclaim any liability on the part of the subcontractor (c) Make the subcontractor who ultimately receives the contract liable (d) Provide for payment directly to the Government

Question 41: Which of the following is an indication of potential defective pricing fraud? (a) Failure to correct known system deficiencies which lead to defective pricing (b) Using a vendor other than the one proposed (c) Changed dates (d) Indications of falsification or alteration of supporting data (e) All of the above

Question 42: Pricing is a process of accumulating cost data. (a) Static (b) Dynamic

Question 43: The initiates the internal detail cost estimating process at the cost kick- off meeting. (a) Program manager (b) Proposal manager (c) Auditor (d) Both (a) and (b)

Question 44: Which of the following types of contracts represents the least cost responsibility for the contractor? (a) Cost plus fixed fee (b) Firm fixed price (c) Fixed price incentive (d) Fixed price redetermination

Question 45: A Cost Plus Fixed Fee Completion Form type of contract should be used when: (a) There is no confidence that the scope of work has been defined (b) There is no confidence in the cost estimate (c) No research and development work is contemplated (d) Hardware is being developed, or where a final report of research is required

Question 46: Contractors receive no fee under: (a) Fixed price incentive contracts (b) Performance incentive contracts (c) Cost contracts (d) CPFF Completion Form contracts

Question 47: is most suitable for use in procurements of complex military weapons where there are substantial development goals or potentialities for improved performance which are of great importance to the government. (a) Firm fixed price (b) Fixed price incentive (c) Performance incentive (d) Fixed price with award fees

Question 48: If a change takes place because of a new Cost Accounting Standard, or a change in a disclosed accounting practice, the contractor: (a) Must agree to an equitable adjustment if a contract cost is affected (b) Must negotiate with the contracting officer the cost/price impact of the change (c) Must agree to an adjustment in the contract price or cost allowance if he fails to comply with Cost Accounting Standards and such failure results in increased costs paid by the United States (d) All of the above

Question 49: Only the has authority to waive all or any part of the CAS clauses. (a) Contracting Officer (b) Secretary of Defense (c) Cost Accounting Standards Board (d) Comptroller General

Question 50: The auditor may review a Disclosure Statement for: (a) Adequacy (b) Allocability (c) Reasonableness (d) Mathematical errors (e) Allowability

Question 51: Which of the following statements about the Disclosure Statement is untrue? (a) It is a formal description of the contractors accounting system (b) It is actually a benchmark for determining contract compliance (c) It describes the accounting system the contractor intends to use to account for costs on a contract (d) Once the Disclosure Statement is submitted by a contractor, it may not be changed

Question 52: Which of the following is an advantage of multiyear contracting? (a) Stabilization of work forces (b) Substantial continuity of production (c) Lower cost (d) All of the above

Question 53: The multiyear procurement system is compatible with: (a) Sealed bidding (b) Two-step sealed bidding (c) Negotiation (d) All of the above (e) Only (a) and (b) above

Question 54: If a multiyear contract is terminated for default, the Governments rights include: (a) The remaining items to be procured (b) The entire multiyear quantity (c) Only those items already procured (d) None of the above

Question 55: Under fixed-price-type contracts, the contractor is generally paid as items are delivered. (a) Progress payments (b) Guaranteed loans (c) Advance payments (d) Partial payments (e) None of the above

Question 56: Partial payments may be used in conjunction with: (a) Progress payments (b) Guaranteed loans (c) Advance payments (d) All of the above (e) None of the above

Question 57: Under what circumstances may a subcontractor secure a guaranteed loan? (a) Under no circumstances (b) Generally, under the same circumstances as prime contractors (c) Up to 50% of receivables (d) Up to 50% of inventory and work in process (e) Up to 70% of receivables

Question 58: Which of the following statements is untrue about the Changes clause? (a) The right of the contracting officer to issue a change order is not a matter of implied right or statute (b) The Changes clause provides that the contracting officer may issue a change order without the consent of the contractor (c) The Changes clause provides for an equitable adjustment in the price or delivery schedule (d) Government prefers to issue unilateral changes rather than negotiate changes with the contractor

Question 59: The Changes clause provides that, any claim by the contractor for adjustment under this clause must be asserted within from the date of receipt by the contractor or notification of the change. (a) 24 hours (b) 10 days (c) 2 weeks (d) 30 days

Question 60: There are two basic types of cost-plus-fixed-fee contracts. describes the scope of work to be done in general terms and which obligates the contractor to devote a specified level of effort for a stated period of time for the conduct of research and development activities. (a) Completion Form (b) Term Form

Question 61: The Government is normally required to purchase the initial supply of spare parts from the: (a) Original prime contractor (b) Manufacturer who actually fabricates the parts (c) Neither of the above

Question 62: is an element to be considered in spare parts pricing but does not affect end item pricing. (a) Assembly labor (b) Start-up costs (c) Engineering documentation (d) Development engineering

Question 63: Production costs of contract data are largely: (a) Labor costs (b) Material and processing costs (c) Neither of the above

Question 64: When the contractor submits a termination inventory schedule, the most important factor which must be represented correctly is: (a) Quantity of items (b) Allocability (c) The acquisition cost of the items (d) An accurate description of the items

Question 65: Once a contract has been terminated, the contracting officer may not modify or rescind the notice without: (a) Approval of the Head of the Procuring Activity (b) The contractors consent (c) Audit by the Government Accountability Office (d) Audit by the Defense Contract Audit Agency

Question 66: The plant clearance period begins: (a) On the effective date of contract termination (b) When the contractor submits acceptable inventory schedules (c) 24 hours after the contractor receives the Notice of Termination (d) When the contractors personnel office receives notice of the termination

Question 67: Use of the basis for settlement proposals is generally preferred by the Government. (a) Total cost (b) Inventory (c) Percentage of completion (d) None of the above

Question 68: A contractor may not request an amount in excess of the contract price in a termination claim except: (a) When he/she is operating on a loss and the contract is nearly completed (b) For settlement expenses (c) When authorized by the contracting officer (d) None of the above

Question 69: The contractor may charge storage costs for termination inventory starting from: (a) The date of termination (b) The beginning of the plant clearance period (c) The end of the plant clearance period (d) The date that he/she submits acceptable inventory schedules

Question 70: The established base used for measurement of contract performance is called the: (a) Contract Target Cost (b) Contract Budget Base (c) Performance Measurement Baseline (d) Control Account Performance Summary

Question 71: Earned value management is an integrative approach which brings together to give the program or project manager an effective system for managing the program/project work. (a) Cost (b) Schedule (c) Technical planning and control (d) All of the above (e) Only (a) and (b) above

Question 72: The cost actually incurred and recorded in accomplishing the work within a given time period is called the: (a) Cost Variance. (b) Budget at Completion. (c) Actual Cost of Work Performed (ACWP). (d) Budgeted Cost for Work Performed (BCWP).

Question 73: To trigger a formal schedule or cost performance analysis, the program office establishes: (a) Variance thresholds (b) Scheduled review points (c) End of contract assessments (d) Periodic meetings depending on performance achievement

Question 74: The most important and critical part of earned value is: (a) The accurate determination of the actual cost of the work performed (b) A realistic approach to work package planning and BCWS values for milestones (c) The use of a computerized system for collecting data and calculating performance (d) The determination of cost performance compared to the originally developed plans

Question 75: is responsible for evaluating the reasonableness of the offered prices. (a) Contracting officer (b) Price analyst (c) Engineer (d) Contract auditor (e) None of the above

Question 76: Cost estimates are submitted by contractors in connection with: (a) Modification and change proposals (b) Prices of spare parts (c) Rates for time and material contracts (d) Estimated and final costs of cost type contracts (e) All of the above TRUE FALSE:

Question 77: Failure to earn a profit on a particular contract may not necessarily be a loss if the firm had no alternative uses for the resources employed on it. (T or F)

Question 78: Advertising costs are never considered allowable costs. (T or F)

Question 79: Preparing estimates for the initial research activity is the most difficult part of the estimating process. (T or F)

Question 80: Reclassification of costs from indirect to direct is certain to send overhead rates down. (T or F)

Question 81: The auditor is the only Government Acquisition Team member with general access to the offerors accounting records. (T or F)

Question 82: A cumulative average learning curve can be accurately projected from a unit learning curve. (T or F)

Question 83: Cost or pricing data are always required for standard commercial items. (T or F)

Question 84: Some contractor accounting systems accumulate and record production engineering costs as part of manufacturing overhead. (T or F)

Question 85: Capital equipment should be treated as a direct cost item. (T or F)

Question 86: It is impossible to develop a standard method of summarizing hardware costs. (T or F)

Question 87: A contract allowing a contractor to be reimbursed cost plus a percentage of cost is an acceptable method of Government contracting. (T or F)

Question 88: The DCAA audits every contract. (T or F)

Question 89: The cost proposal must always be submitted with the technical and management proposals. (T or F)

Question 90: Cost data is not used to establish the price. It is used to justify it. (T or F)

Question 91: The firm fixed price contract is the easiest and least costly to administer. (T or F)

Question 92: The determination of currency is the most critical aspect of the adequacy test of a Disclosure Statement. (T or F)

Question 93: The procedures for multiyear contracting are located in FAR 18.1. (T or F)

Question 94: The Prompt Payment Act requires Federal agencies to pay interest on payment requests unless they pay the contractor within fifty days after any given payments due date. (T or F)

Question 95: The issuance of a change order requires an adjustment in the contract price. (T or F)

Question 96: Spare parts may be purchased under any type of contract. (T or F)

Question 97: Partial payments to terminated subcontractors under a terminated prime contract can be made through other than the prime contractor. (T or F)

Question 98: Contract changes may impact virtually all aspects of a contractors internal planning and control system. (T or F)

Question 99: Estimating surveys are primarily made for the interest of the Government and rarely benefit the contractor. (T or F)

Question 100: The DCAA has the authority, or inherent right, to audit or review any firms books and records before a contract is signed. (T or F)