A Supplier That Is Under an FFP Contract May End

question 16

Multiple Choice

A supplier that is under an FFP contract may end up losing money and request relief.Which of the following reasons is why the customer will allow changing the price?

• A) Customer did not contributed to the loss
• B) Customer does not need the items
• C) Customer assumes no other suppliers are available
• D) Supplier has facilities that are not unique
• E) There is plenty of time to find a new supplier

---

Definitions:

GAAP

Generally Accepted Accounting Principles are a compilation of universally accepted standards and rules for accounting and financial reporting.

IFRS

International Financial Reporting Standards, a set of global accounting guidelines outlining how transactions and other accounting events should be reported in financial statements.

Internal Control Procedures

Methods and guidelines set up by an organization to guarantee the accuracy of fiscal and accounting data, encourage responsibility, and deter dishonest practices.

Bank Reconciliation

The process of matching and comparing figures from the accounting records against those presented on a bank statement to ensure consistency and accuracy of financial data.