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Analyzing Contract Costs Exam
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contains 55 Questions
~ 1) Which of the following must be true to properly classify a cost as an “other direct cost”?
[Recognize concerns that affect the other direct costs proposedi [Remediation Accessed :N]
OAll of these
o The proposed cost benefits only the proposed contract work
OThe offeror customarily treats similar costs as “other direct costs” under similar
circumstances
®The contractor’s accounting system segregates “other direct costs” from similar indirect
costs
j 2) True or False: Special test equipment that is engineered, designed, fabricated, or modified to
‘V meet specific contract needs and cannot be used for other contracts can be categorized as
“other direct costs.” [Determine if the other direct costs are properly proposedi
®True
0 False
j 3)
‘V
What[Identify
rate? is the most common
indirect baseand
cost pools forbasesi
calculating the General and Administrative (G&A) overhead
® Total of all costs
0 Total price
o Other direct costs
0 Total management cost
v 4) What two costs elements are required to calculate an indirect cost rate? [Identify the
process of calculating indirect cost ratesi [Remediation Accessed :NJ
o Expense pool and Allocation base
OOverhead rate and Expense base
QAllocation Pool and Expense base
®Allocation base and Overhead rate
https ://leam.dau.milIAtlas2/htmL/testengine/TestGeneration/test review.j sp 2/16/2018
,DAU Page2ofll
j 5) In which of the following phases does the contractor determine actual indirect cost rates?
~ identify the cost allocation cyclel
® Final Allocation Phase
o Beginning Payment Phase
C Proposal Phase
OBilling Phase
6) Which of the following situations would you most likely employ linear regression
techniques? ildentify what regression analysis isi [Remediation Accessed :N)
o Estimating the cost of a new armored vehicle based on historical costs of similar procurements
C Analyzing the accuracy of a shouldcost analysis generated by a DCMA Industrial Engineer
® Calculating the mean cost of one individual unit in a production run of 10,000 units
o Comparing the proposed costs of a new computer database with the historical costs of all
recent contracts in your office
j 7) Which regression method assumes a linear relationship between the dependent and
“~ independent variables? Ildentifv the different repression analysis methodsi
®Simple linear regression
o Local regression
o Segmented regression
o Curvilinear regression
8) Identify the situation where you would use simple linear regression. lidentify contract
pricing situations where simple repression analysis should be consideredi [Remediation Accessed :N]
o Direct cost analysis
® Labor classification analysis
o Facilities Capital Cost of Money calculation
OProfit objective calculation
~ 9) True or FaIse~ After completing the fivestep LeastBestSquaresFit (LBSF) process when
developing a regression equation, you must evaluate the “goodness” of the fit and the
statistical significance. fldentify the steps for using simple repression analysisi [Remediation
Accessed :N]
®False
OTrue
~ 10) Which of the following situations would the use of improvement curve analysis likely be
“ useful in evaluating proposed costs? fldentify situations where improvement curve analysis would be
appropriatel [Remediation Accessed :N]
QAssembly line repair of a turret assembly for an MIIA2 Abrams tank
OAssembly of two new, prototype aerial refueling airplanes
https ://leam.dau.mil/Atlas2/html/testengine/TestGenerationltest_review.j sp 2/16/2018
,DAU Page3ofll
0 Fabrication of a single jet engine frame assembly
®Fabrication of a new aircraft carrier
j 11) What is the best method for determining an improvement curve slope? rldentifv the steps for
‘V using improvement curve analysisi
® Using actual historical data
o Using the median percentage from similar products
o Using established slopes from the Cost Estimator’s Reference Manual
0 Using averages derived from recent procurements
j 12) Given the following improvement curve data, calculate the cost objective for unit #64. Labor
‘V 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 obiective using improvement curve analysisi
® 33,600
062,200
0155,800
08,400
x 13) True(FCCOM)
Money or False: The U.S. Treasury
[Recognize elements Rate is used
affecting in calculating
facilities FacilitIes
capital cost of moneyl Capital Cost of
[Remediation
Accessed :N]
C True
®False
j 14) Which of the following is a factor that most directly affects profitlfee calculations? [Identify the
‘V factors affecting profitlfee analysisi
® Contract type
0 Distribution of equipment percentage
0 Magnitude of the contract in dollars
0 Profitlfee percentage historically paid to contractor
~ 15) When is the working capital adjustment used while calculating profitlfee? [Calculate a profitifee
‘Vusing the appropriate structured approachl
® On all fixed price contracts with progress payments
COn all fixed price contracts
OOn all fixed price contracts with financing
OOn all cost reimbursement contracts
~ 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 prenegotiation position for profit or fee that is fair and reasonable.1
[Remediation Accessed :N]
https ://leam.dau.mil/Atlas2/html/testengine/TestGeneration/test review.j sp 2/16/2018
, DAU Pagc4ofll
0 Total costs
® Direct costs
o Total price
o Indirect costs
j 17) Which of the following factors is critical to a successful negotiation? fldentifv factors that
~ contribute to success in any negotiationi
® Effectively prepare, plan, and communicate
0 Avoid being too friendly, in case the negotiations get difficult
o Set your opening position extremely low to give room to negotiate
OThe negotiation should be competitive
j 18) What is the negotiation term that reflects each party emphasizing the long term effects and
‘V benefits as well as both parties defining their interests to be achieved in conjunction with the
outcome? Fldentifv key terms involved during a contract negotiationi
®WinWin
o WinLose
o LoseLose
o WinLoseWin
19) What is an important driver to a successful negotiation? (Identify the importance of
understanding cost drivers to ensure a successful outcomel [Remediation Accessed :N]
0 Listen to understand
® Ensure your position is heard
o Maintain position of power
o 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 riski [Remediation Accessed :N]
o Selection of contract type
® The profitlfee percentage objective
Orhe selection of a the awardee
OWhether to solicit to large business, or set aside for small business only
21) Each Price Negotiation Memorandum must contain which one of the following? [Identify
the key characteristics of a price negotiation memorandumi [Remediation Accessed :N]
0 Statement that the price is fair and reasonable
® Statement that the FAR was consistently followed
o Signature of the Contract Specialist
https ://learn.dau.mil/Atlas2/html/testengine/TestGeneration/test_review.j sp 2/16/2018
Analyzing Contract Costs Exam
~ Here is your test result.The dots represent the choices you have made.
i The highlighted questions are the questions you have missed.
~ Remediation Accessed shows whether you accessed those links.’N’ represents links not visited and ‘Y’
represents visited links.
Back to Status page
contains 55 Questions
~ 1) Which of the following must be true to properly classify a cost as an “other direct cost”?
[Recognize concerns that affect the other direct costs proposedi [Remediation Accessed :N]
OAll of these
o The proposed cost benefits only the proposed contract work
OThe offeror customarily treats similar costs as “other direct costs” under similar
circumstances
®The contractor’s accounting system segregates “other direct costs” from similar indirect
costs
j 2) True or False: Special test equipment that is engineered, designed, fabricated, or modified to
‘V meet specific contract needs and cannot be used for other contracts can be categorized as
“other direct costs.” [Determine if the other direct costs are properly proposedi
®True
0 False
j 3)
‘V
What[Identify
rate? is the most common
indirect baseand
cost pools forbasesi
calculating the General and Administrative (G&A) overhead
® Total of all costs
0 Total price
o Other direct costs
0 Total management cost
v 4) What two costs elements are required to calculate an indirect cost rate? [Identify the
process of calculating indirect cost ratesi [Remediation Accessed :NJ
o Expense pool and Allocation base
OOverhead rate and Expense base
QAllocation Pool and Expense base
®Allocation base and Overhead rate
https ://leam.dau.milIAtlas2/htmL/testengine/TestGeneration/test review.j sp 2/16/2018
,DAU Page2ofll
j 5) In which of the following phases does the contractor determine actual indirect cost rates?
~ identify the cost allocation cyclel
® Final Allocation Phase
o Beginning Payment Phase
C Proposal Phase
OBilling Phase
6) Which of the following situations would you most likely employ linear regression
techniques? ildentify what regression analysis isi [Remediation Accessed :N)
o Estimating the cost of a new armored vehicle based on historical costs of similar procurements
C Analyzing the accuracy of a shouldcost analysis generated by a DCMA Industrial Engineer
® Calculating the mean cost of one individual unit in a production run of 10,000 units
o Comparing the proposed costs of a new computer database with the historical costs of all
recent contracts in your office
j 7) Which regression method assumes a linear relationship between the dependent and
“~ independent variables? Ildentifv the different repression analysis methodsi
®Simple linear regression
o Local regression
o Segmented regression
o Curvilinear regression
8) Identify the situation where you would use simple linear regression. lidentify contract
pricing situations where simple repression analysis should be consideredi [Remediation Accessed :N]
o Direct cost analysis
® Labor classification analysis
o Facilities Capital Cost of Money calculation
OProfit objective calculation
~ 9) True or FaIse~ After completing the fivestep LeastBestSquaresFit (LBSF) process when
developing a regression equation, you must evaluate the “goodness” of the fit and the
statistical significance. fldentify the steps for using simple repression analysisi [Remediation
Accessed :N]
®False
OTrue
~ 10) Which of the following situations would the use of improvement curve analysis likely be
“ useful in evaluating proposed costs? fldentify situations where improvement curve analysis would be
appropriatel [Remediation Accessed :N]
QAssembly line repair of a turret assembly for an MIIA2 Abrams tank
OAssembly of two new, prototype aerial refueling airplanes
https ://leam.dau.mil/Atlas2/html/testengine/TestGenerationltest_review.j sp 2/16/2018
,DAU Page3ofll
0 Fabrication of a single jet engine frame assembly
®Fabrication of a new aircraft carrier
j 11) What is the best method for determining an improvement curve slope? rldentifv the steps for
‘V using improvement curve analysisi
® Using actual historical data
o Using the median percentage from similar products
o Using established slopes from the Cost Estimator’s Reference Manual
0 Using averages derived from recent procurements
j 12) Given the following improvement curve data, calculate the cost objective for unit #64. Labor
‘V 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 obiective using improvement curve analysisi
® 33,600
062,200
0155,800
08,400
x 13) True(FCCOM)
Money or False: The U.S. Treasury
[Recognize elements Rate is used
affecting in calculating
facilities FacilitIes
capital cost of moneyl Capital Cost of
[Remediation
Accessed :N]
C True
®False
j 14) Which of the following is a factor that most directly affects profitlfee calculations? [Identify the
‘V factors affecting profitlfee analysisi
® Contract type
0 Distribution of equipment percentage
0 Magnitude of the contract in dollars
0 Profitlfee percentage historically paid to contractor
~ 15) When is the working capital adjustment used while calculating profitlfee? [Calculate a profitifee
‘Vusing the appropriate structured approachl
® On all fixed price contracts with progress payments
COn all fixed price contracts
OOn all fixed price contracts with financing
OOn all cost reimbursement contracts
~ 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 prenegotiation position for profit or fee that is fair and reasonable.1
[Remediation Accessed :N]
https ://leam.dau.mil/Atlas2/html/testengine/TestGeneration/test review.j sp 2/16/2018
, DAU Pagc4ofll
0 Total costs
® Direct costs
o Total price
o Indirect costs
j 17) Which of the following factors is critical to a successful negotiation? fldentifv factors that
~ contribute to success in any negotiationi
® Effectively prepare, plan, and communicate
0 Avoid being too friendly, in case the negotiations get difficult
o Set your opening position extremely low to give room to negotiate
OThe negotiation should be competitive
j 18) What is the negotiation term that reflects each party emphasizing the long term effects and
‘V benefits as well as both parties defining their interests to be achieved in conjunction with the
outcome? Fldentifv key terms involved during a contract negotiationi
®WinWin
o WinLose
o LoseLose
o WinLoseWin
19) What is an important driver to a successful negotiation? (Identify the importance of
understanding cost drivers to ensure a successful outcomel [Remediation Accessed :N]
0 Listen to understand
® Ensure your position is heard
o Maintain position of power
o 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 riski [Remediation Accessed :N]
o Selection of contract type
® The profitlfee percentage objective
Orhe selection of a the awardee
OWhether to solicit to large business, or set aside for small business only
21) Each Price Negotiation Memorandum must contain which one of the following? [Identify
the key characteristics of a price negotiation memorandumi [Remediation Accessed :N]
0 Statement that the price is fair and reasonable
® Statement that the FAR was consistently followed
o Signature of the Contract Specialist
https ://learn.dau.mil/Atlas2/html/testengine/TestGeneration/test_review.j sp 2/16/2018
