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1) Which of the following types of costs might be found both as direct costs and indirect costs, depending on the circumstance? [Recognize concerns that affect the other direct costs proposed] [Reme... diation Accessed :N] Travel Direct Material G&A Overhead Utilities 2) Which of these statements below is correct regarding the criteria for classifying a special test equipment cost as an "other direct cost”? [Determine if the other direct costs are properly proposed] Engineered, designed, fabricated, or modified to meet specific contract needs and cannot be used for other contracts An item (e.g., fixture, pattern, or gauge) that is necessary in aiding the development of a unique product Engineered, designed, fabricated, or modified to meet not only the requirements of the current contract but also the requirements of all other contracts Developed and engineered by a subcontractor who is not currently working on another contract 3) Which of the following is an indirect cost pool? [Identify indirect cost pools and bases] [Remediation Accessed :N] General and Administrative Expenses Direct material Assembly labor Manufacturing labor 4) What two costs elements are required to calculate an indirect cost rate? [Identify the process of calculating indirect cost rates] [Remediation Accessed :N] Expense pool and Allocation base Overhead rate and Expense base Allocation Pool and Expense base Allocation base and Overhead rate 5) In which of the following phases does the contractor determine actual indirect cost rates? [Identify the cost allocation cycle] [Remediation Accessed :N] Final Allocation Phase Beginning Payment Phase Forward Pricing Phase Billing Phase 6) Which of the following situations would you most likely employ linear regression techniques? [Identify what regression analysis is] [Remediation Accessed :N] Estimating the cost of a new armored vehicle based on historical costs of similar procurements Analyzing the accuracy of a should-cost analysis generated by a DCMA Industrial Engineer Calculating the mean cost of one individual unit in a production run of 10,000 units Comparing the proposed costs of a new computer database with the historical costs of all recent contracts in your office 7) Which regression method assumes a linear relationship between the dependent and independent variables? [Identify the different regression analysis methods] Simple linear regression Local regression Segmented regression Curvilinear regression 8) Identify the situation where you would use simple linear regression. [Identify contract pricing situations where simple regression analysis should be considered] [Remediation Accessed :N] Indirect cost rate analysis Labor classification analysis Facilities Capital Cost of Money calculation Profit objective calculation 9) After completing the five-step Least-Best-Squares-Fit (LBSF) process in developing a regression equation, you must evaluate which two aspects of the equation? [Identify the steps for using simple regression analysis] [Remediation Accessed :N] "Goodness" of the fit and statistical significance Coefficient of determination and the median Prediction interval and significance level Standard error of the estimate and the mean 10) Which situation below would you use improvement curve analysis to evaluate proposed costs? [Identify situations where improvement curve analysis would be appropriate] [Remediation Accessed :N] Assembly line with high proportion of manual labor Fully automated assembly line Production facility specializing in “one-off” or unique item production Fabrication plant that generates 100,000 units per month 11) What is the first step in conducting improvement curve analysis? [Identify the steps for using improvement curve analysis] [Remediation Accessed :N] Collect the historical data Calculate the rate of improvement Calculate the slope of the curve Determine the Theoretical value of unit #1 12) Given the following improvement curve data, calculate the cost objective for unit #64.  Labor hours for unit #32: 42,000 hours  Labor hours for unit #1: 79,000 hours  Rate of improvement: 20%  Improvement curve slope: 80% [Calculate an objective using improvement curve analysis] 33,600 62,200 15,800 8,400 13) Which of the following are factors used in calculating the Facilities Capital Cost of Money (FCCOM) amount? [Recognize elements affecting facilities capital cost of money] [Remediation Accessed :N] Proposal allocation base amounts Percentage of land, building, and profit distributions Company-wide allocation base amounts Division-wide allocation base amounts 14) Which of the following is a factor that affects profit/fee calculations? [Identify the factors affecting profit/fee analysis] [Remediation Accessed :N] Contract type Distribution of equipment percentage Magnitude of the contract in dollars Profit/fee percentage historically paid to contractor 15) When calculating profit/fee, how is the “performance risk (composite)” calculated? [Calculate a profit/fee using the appropriate structured approach] [Remediation Accessed :N] By multiplying the assigned weight by the assigned value of the technical and the management/cost control element, and adding the two together By adding the assigned weights and assigned values of the technical and management/cost control elements By multiplying the assigned values of the technical and management/cost control elements By adding the assigned weight and assigned value of the technical and management/cost control elements and dividing the sum by 2 16) What is the “base” that used in the calculation of the performance risk, contract type risk, and cost efficiency factor when using the weighted guidelines to determine a profit/fee objective? [– Develop a pre-negotiation position for profit or fee that is fair and reasonable.] [Remediation Accessed :N] Total costs Subtotal of costs Total price Direct and Indirect costs 17) What is the government’s primary objective in negotiations? [Identify factors that contribute to success in any negotiation] To agree on a price that is fair and reasonable to the government and the contractor To establish a profit/fee percentage that is in line with previous contracts with the particular contractor To agree on each element of cost with the contractor To ensure the agreed to price is the same, or lower, than the government’s objective 18) What is the negotiation term that reflects each party emphasizing the long term effects and benefits as well as both parties defining their interests to be achieved in conjunction with the outcome? [Identify key terms involved during a contract negotiation] Win-Win Win-Lose Lose-Lose Win-Lose-Win 19) What is an important driver to a successful negotiation? [Identify the importance of understanding cost drivers to ensure a successful outcome] Listen to understand Ensure your position is heard Maintain position of power Obtain the lowest price for the government 20) What is the single most important decision the Contracting Officer must make to mitigate cost risk? [Identify strategies to mitigate cost risk] [Remediation Accessed :N] Selection of contract type The profit/fee percentage objective The selection of a the awardee Whether to solicit to large business, or set aside for small business only 21) Each Price Negotiation Memorandum must contain which of the following? [Identify the key characteristics of a price negotiation memorandum] [Remediation Accessed :N] Statement that the price is fair and reasonable Statement that the FAR was consistently followed Signature of the Contract Specialist Signature of the Legal Counsel 22) Identify the circumstances when cost analysis should be performed by answering the following question. “Unless an exception to certified cost or pricing data applies, you can perform cost analysis on which of the following procurements?” [Identify cost analysis terms and techniques used when developing a pre-negotiation position] All of these are correct The award of any negotiated contract (except for undefinitized actions such as letter contracts The award of a subcontract at any tier, if the contractor and each higher-tier subcontractor have been required to furnish certified cost or pricing data The modification of any sealed bid or negotiated contract 23) Identify the response below that correctly describes the term “Data other than certified cost or pricing data.” [Identify terms associated with the Truth-in-Negotiations Act (TINA)] [Remediation Accessed :N] Pricing data, cost data, and judgmental information that is not certified, but is used to determine a fair and reasonable price All facts that prudent buyers and sellers would reasonably expect to affect price negotiations significantly and are factual, not judgmental, and are verifiable through certification Pricing data and cost data that demonstrate an imbalance in unit pricing even though the overall proposed price appears to be fair and reasonable Pricing data, cost data, and judgmental information that is not certified and therefore cannot be relied upon to determine a fair and reasonable price 24) Which of the following situations are considered exempt from the submission of Certified Cost or Pricing Data? [Determine if an exception to the Truth-in-Negotiations Act applies] 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 proposal techniques Non-commercial modification of a commercial item. Modification funded by DoD and constitutes 5% of value of modification 25) When the Contracting Officer has relied on certified cost or pricing data in the price determination, which of the following statements is true? [Identify the remedy to the Government in the event that a contractor submits defective data] They must certify that they relied on that certified cost or pricing data in the Price Negotiation Memorandum They must have had legal counsel review the cost or pricing data prior to negotiations They are not required to certify that they relied on that cost or pricing data in the Price Negotiation Memorandum They acknowledge their reliance on that cost or pricing data by signing the Price Negotiation Memorandum 26) Who has the authority to waive CAS applicability for a particular contract? [Identify the exemptions to Cost Accounting Standards (CAS) coverage] [Remediation Accessed :N] The Agency Head A level above the contracting officer The Contracting Officer's Representative The Cognizant Federal Agency Official 27) Which contract clause is inserted in contracts that are subject to full CAS coverage? [Determine the level of CAS coverage that applies] FAR 52.230-2 Cost Accounting Standards FAR 52.230-5 Cost Accounting Standards – Educational Institutions FAR 52.230-3 Disclosure and Consistency of Cost Accounting Practices FAR 52.230-1 Cost Accounting Standards Notices and Certification 28) Which of the following situations would require a Disclosure Statement? [Identify the purpose of a Disclosure Statement] [Remediation Accessed :N] Contractor receives a CAS covered contract or a subcontract valued at $50M in a cost accounting period Contractor receives a contract valued at $7.5M or greater Anytime a cost reimbursement contract is awarded Anytime a sole-source contract is awarded 29) A contractor incurs a cost which is determined to be unallowable. Other costs which would not have been incurred “but for” the incurrence of the unallowable costs are: [Determine if a cost is allowable] Directly associated costs and are also unallowable Indirect costs which will be allocated on the basis of benefits received Directly associated costs which are allowable Indirect costs with are unallowable 30) A contractor incurs costs for raw materials to be used in two different government contracts. Is the total value of this raw material allocable to one contract? [Determine if a cost is allocable] [Remediation Accessed :N] No, material must be used and charged specifically to the benefiting contract Yes, because all the material is to be used for government contracts Yes, due to the efficiency gained by procuring all the material at one time No, raw material is always charged as an overhead expense 31) Which of the following is the best method for determining if a proposed cost is reasonable? [Determine if a cost is reasonable] [Remediation Accessed :N] Comparing with other competitive proposals received in response to the solicitation Performing a quantitative analysis of the proposed cost using multivariate regression Evaluating the conditions surrounding the procurement. In cases of National Emergency or Contingency, any cost within 50% of the IGE is considered reasonable Ensuring the proposed cost is no more than 25% greater than the last known procurement of the item 32) The pre-negotiation objective establishes the government's initial negotiation position and assists the contracting officer in determining a fair and reasonable price. How does proposal modeling assist the contracting officer in achieving these objectives? (Choose all that apply) [Identify the rationale for modeling a contractor’s cost proposal] [Remediation Accessed :N] Validates the contractor's proposal summary with detailed back-up data worksheets Validates the contractor's computations Facilitates update of pre-negotiation position upon receipt of updates from the contractor (e.g. updated quotes, subcontractor submissions, change in rates) Allows real time calculation of offers and counteroffers during negotiations 33) Which of the following is required in the contractor’s proposal when Cost or Pricing Data are required? [Identify the required cost elements in FAR Table 15- 2] [Remediation Accessed :N] Documentation of agreed to procedures for validating each basis of estimate Forecasts for any planned facility capital improvements Data showing that adequate price competition for acquisitions exceeding the TINA threshold was obtained Basis for establishing proposed profit or fee 34) The two cost accounting systems that are used by a contractor manufacturing a number of specifically identifiable physical units and whose costs are normally accumulated under separate orders is: [Identify the two commonly used systems for cost accounting] Job Order Accounting Generally Accepted Accounting Practice Process Cost System Cost Accounting Standards 35) The purpose of an audit is to: [Identify situations when an audit should be requested] All of these are correct Determine if the data is accurate and complete Determine the degree of compliance with established procedures Verify transaction legality 36) How may you request an audit? [Identify the process for requesting an audit and the key players involved with the process] All of these are correct By telephone call By mail By e-mail 37) Select the item below that would be categorized as an Indirect Material cost. [Identify the different types of material costs] [Remediation Accessed :N] Washers and seals used in the assembly process for all products Marketing costs for the sale of a particular item The purchase of 104 motor assemblies needed to manufacture a product Frames that are fabricated for each individual unit 38) Which of the following is an example of a cost estimating technique that would be used when producing a summary cost estimate? [Determine the fairness and reasonableness of summary level cost estimates] [Remediation Accessed :N] Cost Estimating Relationship (CER) Stratified sampling Bill of Materials analysis Vendor Quotes comparison 39) Identify the objective of performing proposal analysis. [Identify the fundamentals of cost analysis] [Remediation Accessed :N] To ensure the final agreed to price is fair and reasonable To ensure the government negotiates the lowest possible price for goods and services To provide the contract negotiator the best possible profit or fee objective To gain a more complete understanding of the company’s rates and factors 40) Identify the correct definition of “Cost Realism Analysis.” [Distinguish between cost analysis, price analysis, and cost realism analysis] [Remediation Accessed :N] The process of independently reviewing and evaluating specific elements of cost, in part to determine whether they reflect a clear understanding of the requirement The review of a proposal to ensure the contractor has properly documented adherence to their approved estimating system guidelines The review and evaluation of individual cost elements, excluding profit, in a proposal The process of examining and evaluating a proposal to ensure all elements of cost are in line with the Independent Government Estimate 41) Which of the following is known as a “Questioned Cost”? [Identify the various types of audits] [Remediation Accessed :N] Costs on which audit action has been completed and which are not considered as acceptable as a contract cost Costs which the auditor cannot evaluate as allowable or unallowable, because there is not enough information for analysis Costs that have not yet been evaluated Arithmetic difference between the amount proposed and the sum of the related questioned, unsupported, and unresolved amounts 42) Which sampling technique is used to focus on high-value items? [Determine the appropriateness of the offeror's cost estimating methodology] Stratified Random Cluster Nonprobability 43) Which of the following is an effective use of stratified sampling? [Establish the fairness and reasonableness of detailed quantity estimates] Analyzing the items that make up 80% of the total material cost and 10% of the remaining items Analyzing 20% of the items that are under $25,000 Analyzing 100% of the items Analyzing 10% of the items selected randomly 44) Which inventory pricing method is being used when a company recalculates inventory prices every time a new item is added to the inventory? [Evaluate the reasonableness of unit cost estimates] [Remediation Accessed :N] Moving Average Weighted Average Standard Cost Last In/First Out (LIFO) 45) You are preparing to negotiate a service task for routine maintenance of Government equipment. A sample of 25 records for similar maintenance tasks indicates that the average time required to perform similar maintenance tasks has been six hours and 40 minutes. How can you use this [Identify contract situations where statistical analysis is an appropriate tool for developing a pre-negotiation objective] [Remediation Accessed :N] Developing a price negotiation objective for labor costs Selecting the appropriate contract type Evaluating the bill of materials Assigning the risk factors for profit calculations 46) A measure of the amount of dispersion, or distance, between data points is the: [Differentiate between the measures of central tendency and the methods for measuring dispersion] Standard Deviation Absolute dispersion Relative dispersion Coefficient of variation 47) When calculating the confidence interval, why is the sample standard deviation used to derive the standard error of the mean? [Identify the process for establishing a confidence interval] [Remediation Accessed :N] The population standard deviation is not generally known The sample mean is used to derive the significance level The coefficient of variation is unknown Other methods of central tendency are not reliable 48) How do you apply the decrement factor if you find that the contractor appears to have overestimated the proposal price? [Identify the process for using stratified sampling] [Remediation Accessed :N] Multiply the decrement factor by the total cost of all sampled items Divide the decrement factor from all sampled items Increase the government objective by the decrement factor Decrease the government objective by the decrement factor 49) Given the following data, calculate the standard deviation. Sample data: 13, 12, 9, 15, 11, 16, 17, 8, 12, 7, 12 [Calculate a pre-negotiation objective using the appropriate statistical analysis techniques] 3.19 3.05 4.12 4.21 50) Which of the following would be a proper method of determining the reasonableness of a contractor’s proposed labor hour estimate? [Relate proposed labor hours to work requirements to determine reasonableness of direct labor costs] [Remediation Accessed :N] Compare proposed hours with a Government should-cost estimate Examine proposed hours on 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 51) Which of these situations warrants the use of a round-table estimate? [Examine proposed labor rates to determine a fair and reasonable pre-negotiation position] [Remediation Accessed :N] A contract is for a unique item, and there is no historical data available (i.e., detailed drawings, bill of materials, firm specifications). A contract is for a service that has been provided in the past, and offerors will need to submit data detailing the time it will take for each worker to complete a specific task. A contract is for a service that has been provided in the past, and offerors will need to submit data detailing the time it will take for each worker to complete a specific task. A contract is for $900,000 and there have been several similar contracts performed in the past. Usually, offerors will use comparison estimates for this type of work. 52) Which of the following labor categories in a contractor’s proposal for Grounds Maintenance would raise concern? [Identify proposed direct labor mix] Millwright Maintenance technician Project manager Quality control manager 53) Which of the following labor classifications most likely involves fashioning parts from raw materials or purchased materials? [Identify labor classifications] Fabrication Assembly Quality Control Engineering 54) Which of the following is a grouping of all positions that share the same title and pay level? [Identify types of other direct costs] [Remediation Accessed :N] Position class Position description Position classification plan Direct labor position 55) For which of the following procurements would you require certified cost or pricing data? [Select the appropriate authority for requiring an offeror to provide cost or pricing data] An offer of $800,000 for an item from the only known source of an electronic system unique to Government requirements A single-source offer for $96,000 for Research and Development A commercial item contract modification which indicates that $398,000 of work will be removed by modification and $390,000 of work will be added. An offer of $525,000 for a catalog-priced commercial item [Show More]

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