CIPS L4M2 Exam Questions with Correct Solutions Graded 100% Pass

CIPS L4M2 Exam Questions with Correct Solutions Graded 100% Pass 'Creative' - Answer Generally refers to an abundance of ideas that are more than just superficial changes. 'Should cost' analysis - Answer A technique used by procurement for determining what a purchased product or service should cost based on the materials, components cost processes and overheads of the supplier. 5 main types of acceptance testing - Answer Alpha and beta, contract acceptance, regulation acceptance, operational acceptance and black box testing. A concept to implement standardisation in a service company - Answer The lean concept A purchase price cost analysis on its own is rarely sufficient. What else should you do? - Answer Benchmark the resulting price A result of benchmarking - Answer Enables pegs to learn from success and failures of other business and allow you to build competitive advantage and understanding of the bigger picture with their business or industry. A useful tool for value engineering - Answer Kano model Absorption costing method - Answer The challenge is to attribute a 'fair' amount of fixed costs to each unit of production output. Traditionally this has been done by determining the amount of some measurable resource consumed in a production period and the overheads of that resource. Acceptance testing - Answer Is a process for determining whether a product meets its specification before it is released to the customer. Accrual - Answer An adjustment made to a set of financial accounts to reflect activity that has occurred but for which cash has not yet been received or paid. Acquisition, operation and disposal - Answer There is a vital difference between purchase price and total cost of ownership. This includes 3 categories. Activity based costing method - Answer This is based on the identification of cost drivers and cost pools. There is a difference between purchase price and total cost of ownership. Best value = the lowest whole life cost.