SCMN 3730 EVALUATION EXAM 2026 QUESTIONS AND
SOLUTIONS SCORED A+
-
✔✔Description of required material or service
Quantity required
Estimated unit cost
Operating account to be charged
Date of requisition
Date required
Authorized signature - ✔✔What are the required elements of a purchase requisition?
✔✔A preferred supplier has demonstrated its performance capabilities through previous
purchase contracts and therefore receives preference during the supplier selection
process. - ✔✔What does it take to become a preferred supplier?
✔✔Usually open for 1 year
Used for repeated purchases of item or family of items
Release materials as needed vs. issuing new P.O. each time
P.O. remains open during specified term
Importance of escape clause - ✔✔Blanket Purchase order
✔✔Expensive, complex, and critical purchases
Risk of large contingency fee
Need to identify and monitor relevant supplier costs - ✔✔What is involved in setting up
a cost-based contract?
✔✔Raw Materials - ✔✔Unprocessed natural products used in production
✔✔MRO items - ✔✔Business supplies that include maintenance items, repair items,
and operating supplies.
Most organizations do not track MRO items with same intensity as with production items
There are typically too many MRO suppliers
There are too many small orders which take up too much time
✔✔Capital Equipment - ✔✔items that require a large dollar amount to purchase
Assets to be used > 1 year
Standard general equipment vs. customized equipment
Features of CE procurement
Irregular frequency
Requires large sums of money
Highly sensitive to general economic conditions
, ✔✔EFT - ✔✔Electronic Funds Transfer; exchange of money by sending bank records
via a computer network
✔✔To not run out of supplies - ✔✔What is the most important purchasing objective?
✔✔Spend Analysis - ✔✔Process of collecting historical data by commodity
✔✔Category Management - ✔✔The process of developing insights into stakeholder
requirements, comparing these to external industry intelligence, supply base capabilities
and operational risks, and developing a strategy to align internal requirements with
external supply market conditions.
✔✔P2P - ✔✔procure to pay
1. Forecast & Plan Requirement
2. Need Clarification/ Requisition
3. Supplier Identification& Selection
4. Approval & Contract/ P.O. Generation
5. Receive Material & Documents
6. Settle, Pay, & Measure Performance
✔✔SOW - ✔✔Statement of work, specifies the work that is to be completed, when it is
needed, and what type of service provider is required.
✔✔Volume is sufficiently high
Specifications or requirements are clear to supplier
Marketplace is competitive (i.e., adequate # of suppliers)
Buyers solicit bids only from technically qualified suppliers who want contract
Adequate time is available for suppliers to evaluate RFQ
Buyer does not have preferred supplier for particular item - ✔✔When do you use
competitive bidding?
✔✔Any criteria for competitive bidding are missing
Purchase requires agreement on wide range of performance factors other than price
Buyer requires early supplier involvement
Supplier cannot determine risks and costs before contract is awarded
Supplier requires substantial lead time to develop and produce requested item(s) -
✔✔When do you use negotiation?
✔✔Policy - ✔✔Refers to set of purposes, principles, and rules of action that guide an
organization
Standard operating procedures
Rules and regulations
SOLUTIONS SCORED A+
-
✔✔Description of required material or service
Quantity required
Estimated unit cost
Operating account to be charged
Date of requisition
Date required
Authorized signature - ✔✔What are the required elements of a purchase requisition?
✔✔A preferred supplier has demonstrated its performance capabilities through previous
purchase contracts and therefore receives preference during the supplier selection
process. - ✔✔What does it take to become a preferred supplier?
✔✔Usually open for 1 year
Used for repeated purchases of item or family of items
Release materials as needed vs. issuing new P.O. each time
P.O. remains open during specified term
Importance of escape clause - ✔✔Blanket Purchase order
✔✔Expensive, complex, and critical purchases
Risk of large contingency fee
Need to identify and monitor relevant supplier costs - ✔✔What is involved in setting up
a cost-based contract?
✔✔Raw Materials - ✔✔Unprocessed natural products used in production
✔✔MRO items - ✔✔Business supplies that include maintenance items, repair items,
and operating supplies.
Most organizations do not track MRO items with same intensity as with production items
There are typically too many MRO suppliers
There are too many small orders which take up too much time
✔✔Capital Equipment - ✔✔items that require a large dollar amount to purchase
Assets to be used > 1 year
Standard general equipment vs. customized equipment
Features of CE procurement
Irregular frequency
Requires large sums of money
Highly sensitive to general economic conditions
, ✔✔EFT - ✔✔Electronic Funds Transfer; exchange of money by sending bank records
via a computer network
✔✔To not run out of supplies - ✔✔What is the most important purchasing objective?
✔✔Spend Analysis - ✔✔Process of collecting historical data by commodity
✔✔Category Management - ✔✔The process of developing insights into stakeholder
requirements, comparing these to external industry intelligence, supply base capabilities
and operational risks, and developing a strategy to align internal requirements with
external supply market conditions.
✔✔P2P - ✔✔procure to pay
1. Forecast & Plan Requirement
2. Need Clarification/ Requisition
3. Supplier Identification& Selection
4. Approval & Contract/ P.O. Generation
5. Receive Material & Documents
6. Settle, Pay, & Measure Performance
✔✔SOW - ✔✔Statement of work, specifies the work that is to be completed, when it is
needed, and what type of service provider is required.
✔✔Volume is sufficiently high
Specifications or requirements are clear to supplier
Marketplace is competitive (i.e., adequate # of suppliers)
Buyers solicit bids only from technically qualified suppliers who want contract
Adequate time is available for suppliers to evaluate RFQ
Buyer does not have preferred supplier for particular item - ✔✔When do you use
competitive bidding?
✔✔Any criteria for competitive bidding are missing
Purchase requires agreement on wide range of performance factors other than price
Buyer requires early supplier involvement
Supplier cannot determine risks and costs before contract is awarded
Supplier requires substantial lead time to develop and produce requested item(s) -
✔✔When do you use negotiation?
✔✔Policy - ✔✔Refers to set of purposes, principles, and rules of action that guide an
organization
Standard operating procedures
Rules and regulations
