In the ____ Contract,if a Supplier Can Demonstrate Actual Cost

question 32

Multiple Choice

In the ____ contract,if a supplier can demonstrate actual cost savings through production efficiencies or substitution of materials,the resulting savings from the initial price targets are shared between the supplier and the buyer at a predetermined rate.

• A) time and materials
• B) cost plus fixed fee
• C) fixed-price with incentives
• D) firm fixed price
• E) fixed-price with escalation

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Definitions:

Generally Accepted Accounting Principles

Generally Accepted Accounting Principles (GAAP) refer to a common set of accounting rules, standards, and procedures used in preparing financial statements in the United States.

Financial Accounting Standards Board

An independent nonprofit organization responsible for establishing accounting and financial reporting standards for companies and organizations in the United States.

Federal Law

Legislation enacted by a country's federal government that is valid across the entire nation.

Enron Corporation

An American energy, commodities, and services company based in Houston, Texas, that became infamous for its bankruptcy in 2001 due to one of the largest corporate fraud scandals in history.