1. Upon award of a production contract, the Procuring Contracting Officer (PCO) drafted a
delegation of contracting administration to Defense Contract Management Agency to delegate
some contract administration areas of responsibility. Which of the following is a responsibility
that can be retained at the PCO level? Performing production surveillance and status reporting
2. In response to a partial termination for convenience on the BSVD contract, the Contracting
Officer receives a request for equitable adjustment (REA) proposal equal to $1,750,000. This
proposal includes an estimate of the increased cost to complete 1500 units on the contract. Which
of the following must the Contracting Officer evaluate as she analyzes PDJ's REA proposal?
Whether the contractor's per unit cost adjustments based on lost production efficiency are
appropriate for the 1500 remaining units
3. You have found it necessary to change a specification on your non-commercial contract with
Able, Incorporated. The original contract was awarded using competitive procedures where the
contracting officer considered adequate price competition was present. The estimated cost of the
added work amounts to $550K and the estimated cost of the deleted work is $450K. Will you
require the contractor to supply and certify current, complete and accurate cost and pricing data
pursuant to the Truthful Cost or Pricing Data Statute (previously called Truth in Negotiations Act
(TINA))? Yes - cost and pricing data is required for modifications exceeding the $700K
threshold.
4. You have just issued a unilateral change order under your non-commercial fixed-price supply
contract directing Evans Industries to change from blue-painted to gray-painted fuselages. In
response, you receive the following request for equitable adjustment (REA) from Evans.
Co t'El ment· Rate Total
Materials-40,000 gal gray paint $75 per gal $3,000,000
G&A 75%$2,250,000
Subtotal $5,250,000
Profit 20%$1,050,500
Total Price Increase $6,300,000
Based only on your review of Evans' REA submittal and your understanding of equitable
adjustments, what total price should you establish as your pre-negotiation objective? Total
price cannot be established because Evans did not submit its REA in the proper format.
,5. You have found it necessary to change a specification on your non-commercial contract with
Able Incorporated. Since time is of the utmost importance you have properly issued Able a valid
unilateral change notification (change order). Accordingly, what MUST Able Incorporated do
immediately in response to your unilateral change notification? Commence work to comply
with the change.
6. After acceptance of a non-commercial item, which of the following is a true statement
regarding the Government's rights after acceptance under a fixed price supply contract?
Acceptance is conclusive, except for latent defects, fraud, gross mistakes amounting to
fraud, or as otherwise provided in the contract
7. Assuming no substantial changes have occurred in the condition of a commercial item after its
acceptance, which of the following is a true statement regarding the Governments post-
acceptance rights? The Government must exercise its rights for repair or replacement of
nonconforming supplies within a reasonable time after the defect was discovered or should
have been discovered.
8. Your FPIF non-commercial supply contract is fully funded and your contractor, Gibson
Company, has been making steady progress. The terms required by the Incentive Price Revision -
Firm Target clause appear below.
Target Cost: $1,000,000
Target Profit: $ 150,000
Target Price: $1,150,000
Ceiling Price: $1,250,000
Gov/KTR Share: 80/20 under, 90/10 over
Gibson informs you that they are expecting to come in under target cost by $100,000. What final
profit rate will Gibson earn should their expectations actually materialize? (Round to nearest
whole percentage, E.G. 0.1750 rounds to 18% and 0.01749 rounds to 17%) 19%
9. Upon termination of a contract, the termination contracting officer must determine the
appropriate settlement amount. Part of this process is determining whether the contractor is in
a profit or a loss position. Which of the following accurately describes the application of a loss
ratio? Applying a Loss Ratio ensures the loss percentage the contractor would have
realized had the contract not been terminated is applied to the termination settlement.
, 10. Dewey Spend (DS) Corp was required to submit a Certificate of Current Cost or pricing data
(CCOPD) for an $BOOK modification action to their $7.SM cloaking device contract. DS is
proceeding with contract performance but questions (in writing) the requirement to submit a
certificate of current cost or pricing data. Of the following arguments made by DS to support its
assertion that a CCOPD is not required, which is/are potentially successful? The modification
action is to fund an overrun adjustment to the contract.
11. The Defense Contract Audit Agency (DCAA) has sent you a post award audit alleging
potential defective pricing. During the original negotiations your prime contractor estimated to
purchase a part at $965/unit. But during the post-award audit DCAA found your contractor
actually had obtained a lower firm quote from a reliable vendor in the amount of $960/unit. This
later, lower quote apparently went undisclosed during your original contract negotiations. Which
of the following would be an acceptable defense your contractor could use to prevail against this
DCAA allegation of defective pricing? None of the above would prevail.
12. You have just received a request for equitable adjustment from Mansfield Unlimited in
response to a unilateral change order you issued on your non-commercial fixed price supply
contract. What must you now do to “definitize” this change order? Ensure a cost analysis is
performed, negotiate an equitable adjustment as soon as possible, and resolve ALL
elements and include a contractor release of claims in the supplemental agreement.
13. The Government ordered 200 image intensifier tubes as replacement subcomponents for its
night vision equipment from Clarity ‘n Combat (CNC) Inc. After Government acceptance of the
tubes, it discovered that that the tubes contain a monochromatic P-42 phosphor screen instead of
the required multi-fluorescent P-43 phosphor screen. The subcomponent used by the contractor
would result in a significant reduction in contractor production cost and a significantly reduced
shelf life. The Government intends to investigate potential fraudulent action on the part of the
contractor. Which of the following is NOT required for the Government to prove fraud? The
Government specifications must have stated the minimum shelf life requirement.
14. You have found it necessary to change a specification on your non-commercial contract with
Able Incorporated. The original contract was awarded using competitive procedures where the
contracting officer determined that adequate price competition was present. The estimated cost
of the added work amounts to $550K and the estimated cost of the deleted work is $450K. Will
you require the contractor to supply and certify current, complete and accurate cost and pricing
data pursuant to the Truthful Cost or Pricing Data Statute (previously called Truth in
Negotiations Act (TINA))? Yes – cost and pricing data is required for modifications
exceeding the $750K threshold.
delegation of contracting administration to Defense Contract Management Agency to delegate
some contract administration areas of responsibility. Which of the following is a responsibility
that can be retained at the PCO level? Performing production surveillance and status reporting
2. In response to a partial termination for convenience on the BSVD contract, the Contracting
Officer receives a request for equitable adjustment (REA) proposal equal to $1,750,000. This
proposal includes an estimate of the increased cost to complete 1500 units on the contract. Which
of the following must the Contracting Officer evaluate as she analyzes PDJ's REA proposal?
Whether the contractor's per unit cost adjustments based on lost production efficiency are
appropriate for the 1500 remaining units
3. You have found it necessary to change a specification on your non-commercial contract with
Able, Incorporated. The original contract was awarded using competitive procedures where the
contracting officer considered adequate price competition was present. The estimated cost of the
added work amounts to $550K and the estimated cost of the deleted work is $450K. Will you
require the contractor to supply and certify current, complete and accurate cost and pricing data
pursuant to the Truthful Cost or Pricing Data Statute (previously called Truth in Negotiations Act
(TINA))? Yes - cost and pricing data is required for modifications exceeding the $700K
threshold.
4. You have just issued a unilateral change order under your non-commercial fixed-price supply
contract directing Evans Industries to change from blue-painted to gray-painted fuselages. In
response, you receive the following request for equitable adjustment (REA) from Evans.
Co t'El ment· Rate Total
Materials-40,000 gal gray paint $75 per gal $3,000,000
G&A 75%$2,250,000
Subtotal $5,250,000
Profit 20%$1,050,500
Total Price Increase $6,300,000
Based only on your review of Evans' REA submittal and your understanding of equitable
adjustments, what total price should you establish as your pre-negotiation objective? Total
price cannot be established because Evans did not submit its REA in the proper format.
,5. You have found it necessary to change a specification on your non-commercial contract with
Able Incorporated. Since time is of the utmost importance you have properly issued Able a valid
unilateral change notification (change order). Accordingly, what MUST Able Incorporated do
immediately in response to your unilateral change notification? Commence work to comply
with the change.
6. After acceptance of a non-commercial item, which of the following is a true statement
regarding the Government's rights after acceptance under a fixed price supply contract?
Acceptance is conclusive, except for latent defects, fraud, gross mistakes amounting to
fraud, or as otherwise provided in the contract
7. Assuming no substantial changes have occurred in the condition of a commercial item after its
acceptance, which of the following is a true statement regarding the Governments post-
acceptance rights? The Government must exercise its rights for repair or replacement of
nonconforming supplies within a reasonable time after the defect was discovered or should
have been discovered.
8. Your FPIF non-commercial supply contract is fully funded and your contractor, Gibson
Company, has been making steady progress. The terms required by the Incentive Price Revision -
Firm Target clause appear below.
Target Cost: $1,000,000
Target Profit: $ 150,000
Target Price: $1,150,000
Ceiling Price: $1,250,000
Gov/KTR Share: 80/20 under, 90/10 over
Gibson informs you that they are expecting to come in under target cost by $100,000. What final
profit rate will Gibson earn should their expectations actually materialize? (Round to nearest
whole percentage, E.G. 0.1750 rounds to 18% and 0.01749 rounds to 17%) 19%
9. Upon termination of a contract, the termination contracting officer must determine the
appropriate settlement amount. Part of this process is determining whether the contractor is in
a profit or a loss position. Which of the following accurately describes the application of a loss
ratio? Applying a Loss Ratio ensures the loss percentage the contractor would have
realized had the contract not been terminated is applied to the termination settlement.
, 10. Dewey Spend (DS) Corp was required to submit a Certificate of Current Cost or pricing data
(CCOPD) for an $BOOK modification action to their $7.SM cloaking device contract. DS is
proceeding with contract performance but questions (in writing) the requirement to submit a
certificate of current cost or pricing data. Of the following arguments made by DS to support its
assertion that a CCOPD is not required, which is/are potentially successful? The modification
action is to fund an overrun adjustment to the contract.
11. The Defense Contract Audit Agency (DCAA) has sent you a post award audit alleging
potential defective pricing. During the original negotiations your prime contractor estimated to
purchase a part at $965/unit. But during the post-award audit DCAA found your contractor
actually had obtained a lower firm quote from a reliable vendor in the amount of $960/unit. This
later, lower quote apparently went undisclosed during your original contract negotiations. Which
of the following would be an acceptable defense your contractor could use to prevail against this
DCAA allegation of defective pricing? None of the above would prevail.
12. You have just received a request for equitable adjustment from Mansfield Unlimited in
response to a unilateral change order you issued on your non-commercial fixed price supply
contract. What must you now do to “definitize” this change order? Ensure a cost analysis is
performed, negotiate an equitable adjustment as soon as possible, and resolve ALL
elements and include a contractor release of claims in the supplemental agreement.
13. The Government ordered 200 image intensifier tubes as replacement subcomponents for its
night vision equipment from Clarity ‘n Combat (CNC) Inc. After Government acceptance of the
tubes, it discovered that that the tubes contain a monochromatic P-42 phosphor screen instead of
the required multi-fluorescent P-43 phosphor screen. The subcomponent used by the contractor
would result in a significant reduction in contractor production cost and a significantly reduced
shelf life. The Government intends to investigate potential fraudulent action on the part of the
contractor. Which of the following is NOT required for the Government to prove fraud? The
Government specifications must have stated the minimum shelf life requirement.
14. You have found it necessary to change a specification on your non-commercial contract with
Able Incorporated. The original contract was awarded using competitive procedures where the
contracting officer determined that adequate price competition was present. The estimated cost
of the added work amounts to $550K and the estimated cost of the deleted work is $450K. Will
you require the contractor to supply and certify current, complete and accurate cost and pricing
data pursuant to the Truthful Cost or Pricing Data Statute (previously called Truth in
Negotiations Act (TINA))? Yes – cost and pricing data is required for modifications
exceeding the $750K threshold.
