CIPS A8 Exam Practice Test Instant Access

Question 1

Which of the following best describes the term 'progress payments'?

AA series of payments made at prescribed stages during the contract, usually linked to work satisfactorily completed

BA payment withheld for a period of time after the end of the contract period to ensure satisfactory completion of the contract

CA payment made in advance of the supplier commencing work to enable materials to be purchased

DA payment made to an international supplier using a currency of the suppliers choice.

Answer : C

Question 2

Which of the following best describes a situation when fixed pricing would be appropriate?

AWhen the supplier can estimate the level of resources required

BWhen the supplier has to forecast costs over a long period of time

CWhen prices are likely to fluctuate over short periods of time

DWhen the buyer has a good working relationship with the seller.

Answer : B

Question 3

Which of the following defines the place of delivery of the goods when using the CIF Incoterm?

AOn board the ship at the named destination port

BWhere the goods are handed over to the first carrier or forwarder

COn board the ship at the port of shipment

DAt the named destination place.

Answer : D

Question 4

In which of the following situations is a purchase order most likely to be regarded as a counter offer?

AThe order is sent to a supplier without there being a preceding quotation from the supplier

BThe order is sent to a supplier following a quotation from the supplier bearing the supplier's contract terms

CThe order is sent to a supplier as a result of the buyer being impressed by the product description in the suppliers catalogue

DThe order is sent to a supplier to call off a consignment of materials from a blanket order.

Answer : C

Question 5

Which of the following best describes the nature of risks as applied to 'contract management'?

AThe possibility that the goods being supplied might be dangerous in some way

BThe question of when ownership of the goods actually changes hands from seller to buyer

CThe foreseeing of things that could possibly go wrong with the performance of the contract

DThe possibility that the goods being supplied might have to travel through unstable or war-torn parts of the world.

Answer : C

Question 6

Which of the following best describes the nature of 'damages' (in the legal sense)?

AA supplier being forced by the buyer to pay for the replacement of goods that are found, upon receipt, to be damaged

BThe supplier being forced by the court to reimburse the buyer for costs incurred due to unsatisfactory performance of a contract by the supplier

CThe buyer invoking a contract clause that enables them to buy the goods from another supplier in the event of late delivery by the original supplier

DA supplier being forced by a court to perform a contract in the manner and time stipulated by the buyer in the original purchase order.

Answer : B

Question 7

Which of the following best describes 'intention to create legal relations' under English law?

AThe buyer indicating that they intend to take the seller to court due to a dispute

BThe buyer ordering goods from the seller by means of a written purchase order

CThe buyer receiving written confirmation of a purchase order from the seller

DThe buyer and seller understanding that their agreement is enforceable in law.

Answer : A

CIPS A8 Preparing and Managing Contracts Exam Practice Test