CLC 056 Analyzing Contract Costs

CLC 056 Analyzing Contract Costs Exam Questions And Answers GRADED A  Which of the following situations are considered exempt from the submission of Certified Costor Pricing Data? • Prices are set by law or regulation • Sole source acquisition of $3.5M FFP effort; price determined using cost analysis • Price may be determined fair and reasonable based on price analysis proposaltechniques • Non-commercial modification of a commercial item. Modification funded by DoD andconstitutes 5% of value of modification  When given a set of data that appears to contain outliers, which measure of central tendencyis most appropriate to use? • Median • Coefficient of Determination • Mean • Mode  What is an important driver to a successful negotiation? • Listen to understand • Ensure your position is heard • Maintain position of power • Obtain the lowest price for the government  Which of the following would be a proper method of determining the reasonableness of acontractor’s proposed labor hour estimate? • Compare proposed hours with a Government should-cost estimate • Compare proposed hours with all other contracts from the same contractor • Decrement labor hours estimate according to DCAA standard decrement • Use a stratified sampling techniques to evaluate contractor’s labor hour estimate  Which of the following situations would exempt a contract or subcontract from CAScoverage? • The contract or subcontract is with a small business • Value of the contract or subcontract is $7.5M or less • The Economic Price Adjustment clause for a commercial item is based on an indexformulated with a contractor’s historical cost data • Sole source firm fixed price contract requiring submission of cost or pricing data  True or False: “Direct labor positions” share the same titles and pay levels. • True • False  Which situation below would you use improvement curve analysis to evaluating proposedcosts? • Assembly line with high proportion of manual labor • Fabrication plant that generates 100,000 units per month • Production facility specializing in “one-off” or unique item production • Fully automated assembly line  Using a direct comparison with the cost of a similar contract effort is an acceptable summary estimating technique • True • False  Identify circumstances when cost analysis should be performed by answering the followingquestion. “Unless an exception to certified cost or pricing data applies, you can perform cost analysis on which of the following procurements?" • The modification of any sealed bid or negotiated contract • The award of any negotiated contract (except for undefinitized actions such as lettercontracts) • All of these are correct • The award of a subcontractor at any tier, if the contractor and each higher-tiersubcontractor have been required to furnish certified cost or pricing data  Which sampling technique is used to focus on high-value items? • Stratified • Random • Cluster • Nonprobability  Which of the following is an effective use of stratified sampling? • Analyzing the items that make up 80% of the total material cost and 10% of theremaining items • Analyzing 20% of the items that are under $25,000 • Analyzing 100% of the items • Analyzing 10% of the items selected randomly  Which of the following is a phase in the allocation cycle? • Interim Processing Phase • Adjustment on Rates Phase • Final Allocation Phase • Continuous Rate Application Phase  The purpose of an audit is to: • All of these are correct • Determine if the data is accurate and complete • Verify transaction legality • Determine the degree of compliance with established procedures  How may you request an audit? • All of these are correct • By telephone call • By mail • By e-mail  Which of the following is the best strategy to mitigate cost risk? • Conduct adequate market research prior to entering negotiations • Rely on the contractor’s proposed costs, supported by anecdotal data provided by the • contractor • Evaluate other contract actions awarded to the contractor you’re negotiating with • Establish a firm profit/fee percentage prior to entering negotiations  What is the first step in conducting improvement curve analysis? • Determine the Theoretical value of the unit #1 • Calculate the slope of the curve • Collect the historical data • Calculate the rate of improvement  The cost accounting systems that are used by a contractor manufacturing a number ofidentical units for multiple customers are: • Generally Accepted Accounting Practice • Cost Accounting Standards • Process Cost System • Job Order Accounting  Identify when cost analysis would be required. • When certified cost or pricing data are required • For all proposals exceeding the micropurchase threshold • To evaluate profit or fee • When certified cost or pricing data are required  Identify the primary issue you should consider when analyzing direct labor categories in acontractor's proposal.