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Analyzing Contract Costs Exam
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contains 21 Questions
1) 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
2) Which of the following is a phase in the allocation cycle? [Identify the cost allocation cycle]
Final Allocation Phase
Interim Processing Phase
Adjustment on Rates Phase
Continuous Rate Application Phase
3) When using simple linear regression to analyze the estimated price for a used car, which of the
following independent variables would most likely result in the most accurate estimating
equation? [Identify contract pricing situations where simple regression analysis should be considered]
Mileage of all similar cars
Interior color of all similar cars
Body style of all similar cars
Exterior color of all similar cars
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4) 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]
"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
5) How is the Treasury Rate applied in calculating Facilities Capital Cost of Money (FCCOM)?
[Recognize elements affecting facilities capital cost of money]
Divided into the FCCOM total amount
Treasury rate is not used in calculating FCCOM
Multiplied by the FCCOM total amount
Divided by the Weighted Guidelines profit objective
6) Which of the following is a factor that affects profit/fee calculations? [Identify the factors affecting
profit/fee analysis]
Contract type
Distribution of equipment percentage
Magnitude of the contract in dollars
Profit/fee percentage historically paid to contractor
7) 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.]
Total costs
Subtotal of costs
Total price
Direct and Indirect costs
8) Each Price Negotiation Memorandum must contain which of the following? [Identify the key
characteristics of a price negotiation memorandum]
https://learn.dau.mil/Atlas2/html/testengine/TestGeneration/test_review.jsp 9/8/2017
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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
9) 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
10) Who has the authority to waive CAS applicability for a particular contract? [Identify the
exemptions to Cost Accounting Standards (CAS) coverage]
The Agency Head
A level above the contracting officer
The Contracting Officer's Representative
The Cognizant Federal Agency Official
11) When a contract is subject to CAS, the Contracting Officer: [Determine the level of CAS
coverage that applies] [Remediation Accessed :N]
May not award a contract until a written adequacy determination has been made by the
Cognizant Federal Agency Official
May not award a contract until the cognizant Program Office official has conducted a review of
the disclosure statement for adequacy and compliance
May not award a contract until a written adequacy determination has been made by the
Cognizant Federal Agency Official unless approved as mission critical at least one level above the
contracting officer
Is responsible only for ensuring the appropriate provisions are included in the solicitation. All
other responsibilities for CAS are conducted by the ACO
12) The cost accounting systems that are used by a contractor manufacturing a number of
identical units for multiple customers are: [Identify the two commonly used systems for cost
https://learn.dau.mil/Atlas2/html/testengine/TestGeneration/test_review.jsp 9/8/2017
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accounting] [Remediation Accessed :N]
Process Cost System
Cost Accounting Standards
Generally Accepted Accounting Practice
Job Order Accounting
13) Select the item below that would likely be categorized as a Direct Material cost. [Identify the
different types of material costs]
The purchase of 104 motor assemblies needed to manufacture a product
Rail transportation used to get the materials to the offeror's facility
Extra material or items that are left over from the contract and cannot be used
Washers and seals used in the assembly process for all products
14) Identify the objective of performing proposal analysis. [Identify the fundamentals of cost
analysis]
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
15) Identify the correct definition of “Cost Realism Analysis.” [Distinguish between cost analysis,
price analysis, and cost realism analysis]
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
16) Which of the following is an effective use of stratified sampling? [Establish the fairness and
reasonableness of detailed quantity estimates]
https://learn.dau.mil/Atlas2/html/testengine/TestGeneration/test_review.jsp 9/8/2017
Analyzing Contract Costs Exam
Here is your test result.The dots represent the choices you have made.
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 21 Questions
1) 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
2) Which of the following is a phase in the allocation cycle? [Identify the cost allocation cycle]
Final Allocation Phase
Interim Processing Phase
Adjustment on Rates Phase
Continuous Rate Application Phase
3) When using simple linear regression to analyze the estimated price for a used car, which of the
following independent variables would most likely result in the most accurate estimating
equation? [Identify contract pricing situations where simple regression analysis should be considered]
Mileage of all similar cars
Interior color of all similar cars
Body style of all similar cars
Exterior color of all similar cars
https://learn.dau.mil/Atlas2/html/testengine/TestGeneration/test_review.jsp 9/8/2017
,DAU Page 2 of 6
4) 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]
"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
5) How is the Treasury Rate applied in calculating Facilities Capital Cost of Money (FCCOM)?
[Recognize elements affecting facilities capital cost of money]
Divided into the FCCOM total amount
Treasury rate is not used in calculating FCCOM
Multiplied by the FCCOM total amount
Divided by the Weighted Guidelines profit objective
6) Which of the following is a factor that affects profit/fee calculations? [Identify the factors affecting
profit/fee analysis]
Contract type
Distribution of equipment percentage
Magnitude of the contract in dollars
Profit/fee percentage historically paid to contractor
7) 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.]
Total costs
Subtotal of costs
Total price
Direct and Indirect costs
8) Each Price Negotiation Memorandum must contain which of the following? [Identify the key
characteristics of a price negotiation memorandum]
https://learn.dau.mil/Atlas2/html/testengine/TestGeneration/test_review.jsp 9/8/2017
,DAU Page 3 of 6
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
9) 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
10) Who has the authority to waive CAS applicability for a particular contract? [Identify the
exemptions to Cost Accounting Standards (CAS) coverage]
The Agency Head
A level above the contracting officer
The Contracting Officer's Representative
The Cognizant Federal Agency Official
11) When a contract is subject to CAS, the Contracting Officer: [Determine the level of CAS
coverage that applies] [Remediation Accessed :N]
May not award a contract until a written adequacy determination has been made by the
Cognizant Federal Agency Official
May not award a contract until the cognizant Program Office official has conducted a review of
the disclosure statement for adequacy and compliance
May not award a contract until a written adequacy determination has been made by the
Cognizant Federal Agency Official unless approved as mission critical at least one level above the
contracting officer
Is responsible only for ensuring the appropriate provisions are included in the solicitation. All
other responsibilities for CAS are conducted by the ACO
12) The cost accounting systems that are used by a contractor manufacturing a number of
identical units for multiple customers are: [Identify the two commonly used systems for cost
https://learn.dau.mil/Atlas2/html/testengine/TestGeneration/test_review.jsp 9/8/2017
, DAU Page 4 of 6
accounting] [Remediation Accessed :N]
Process Cost System
Cost Accounting Standards
Generally Accepted Accounting Practice
Job Order Accounting
13) Select the item below that would likely be categorized as a Direct Material cost. [Identify the
different types of material costs]
The purchase of 104 motor assemblies needed to manufacture a product
Rail transportation used to get the materials to the offeror's facility
Extra material or items that are left over from the contract and cannot be used
Washers and seals used in the assembly process for all products
14) Identify the objective of performing proposal analysis. [Identify the fundamentals of cost
analysis]
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
15) Identify the correct definition of “Cost Realism Analysis.” [Distinguish between cost analysis,
price analysis, and cost realism analysis]
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
16) Which of the following is an effective use of stratified sampling? [Establish the fairness and
reasonableness of detailed quantity estimates]
https://learn.dau.mil/Atlas2/html/testengine/TestGeneration/test_review.jsp 9/8/2017
