CPPB Prep Course - Practice Test

FIXED-PRICE WITH ESCALATION/DE-ESCALATION - Answer- The purchasing officer of the governmental agency has expressed serious concerns about the number of repetitive requisitions, solicitations and POs that are being processed to purchase gasoline for the organization. Every time a new order is placed, another requisition is created and the prices paid by each dept. are not consistent; sometimes more and sometimes less depending on competition and timing. The buyer advises that the solution would be to use what type of contract? INSTITUTING A PURCHASING CARD PROGRAM - Answer- A Govt agency with a centralized purchasing dept. has a threshold for small purchases of $1000 and three quotes are required above that figure. There has been a steady increase in the number of requisitions along with recent complaints from internal customers about it taking too long to buy what they need. Which of the following action is most likely to have the biggest impact on reducing costs and saving time in the long run? ADDRESS W/ ON-SITE SUPVSR/CONTRACTOR - Answer- A Govt agency has been having problems with a supplier's performance and may terminate their contract with the supplier. Which of the following would be the best first step in addressing the issue with the supplier? LINE ITEM BUDGET - Answer- An agency uses a budget in which appropriations are approved for different classes of expenditures. Each class is broken into subclasses against which funding for svcs and commodities can be applied. This budget approach maximizes control & ensures financial accountability. What type of budget is this? B) $268,000 - Answer- The procurement dept. is considering the acquisition of 10 high volume multi-function printers at a unit cost of $20,000. The printers have an estimated useful life of 8 yrs and require the following annual costs per printer: Consumable Supplies $350; Electricity $150; and Maintenance $350. What is the total cost of ownership of the printers? A) $264,000, B) $268,000, C) $256,000, D) $260,000 USE THE "CURE NOTICE" PROCEDURES AND GIVE NOTICE OF THE FAILURES TO THE SUPPLIER - Answer- The supplier of a performance based contract that has a initial 3 yr term w/ two one-yr extensions upon satisfactory performance, has failed to perform in accordance w/ specified delivery schedules. They also do not respond to quality issues in a timely manner. The supplier has not been given formal notice of the problems. The internal user does not want the contract extended for the remaining two one-yr periods, and wants to terminate the contract immediately for cause. What should the contract administrator do? D) FORMING - Answer- The members of the team are getting to know one another and learning about the knowledge and skills that each brings to the team. At what phase of development is this team? A) Performing, B) Norming, C) Storming, D) Forming B) ISSUE