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CORe Reliable Test Bootcamp, CORe Reliable Test Braindumps

CORe Reliable Test Bootcamp, CORe Reliable Test Braindumps

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ISM Supply Management Core Exam Sample Questions (Q72-Q77):

NEW QUESTION # 72
A supply manager solicits bids for janitorial services. The incumbent cost is $20,000 per month to perform Scope A. After working with internal stakeholders, obtaining bids, and performing negotiations, a new supplier is awarded the agreement. The new supplier's cost is $19,000 per month to perform Scope A as well as Scope B, which was previously performed by another supplier at a cost of $2,000 per month.
What is the annual cost reduction?

  • A. $12,000
  • B. $36,000
  • C. $48,000
  • D. $24,000

Answer: B

Explanation:
To determine the annual cost reduction:
* Calculate the current annual cost: $20,000/month for Scope A + $2,000/month for Scope B =
$22,000/month. Annually, this is $22,000 * 12 = $264,000.
* Calculate the new annual cost with the new supplier: $19,000/month for both Scope A and Scope B.
Annually, this is $19,000 * 12 = $228,000.
* Determine the annual cost reduction: $264,000 (old annual cost) - $228,000 (new annual cost) =
$36,000. References:
* Procurement and Supply Chain Management by Kenneth Lysons and Brian Farrington
* Principles of Supply Chain Management: A Balanced Approach by Joel D. Wisner, Keah-Choon Tan,
G. Keong Leong


NEW QUESTION # 73
A company bought a piece of land in 2012 for $200,000. In 2013, the piece of land temporarily reduced in value to $150,000 but then appreciated in value to $220,000. How would the company report this piece of land on its balance sheet for 2013?

  • A. $150,000
  • B. $200,000
  • C. $220,000
  • D. $185,000

Answer: B


NEW QUESTION # 74
A supply management office for a county government has been authorized to select a contractor to design, build and operate a new bridge.
In the past, the county has experienced four major problems when hiring contractors:
1) Contractors dropping out of the bidding process due to lack of resources or ability to perform the scope of the work
2) A limited number of competitive bids that are able to achieve the value supply management desires
3) Underperformance of contractors after the award
4) The perception that the contractors are not operating effectively
In order to prevent these problems, which of the following should supply management do FIRST?

  • A. Conduct a pre-bid conference
  • B. Issue a Request for Qualifications
  • C. Issue a Request for Information
  • D. Issue an Invitation for Bid

Answer: B

Explanation:
To address the problems encountered in past projects, issuing a Request for Qualifications (RFQ) is the best initial step. An RFQ allows the supply management office to pre-qualify contractors based on their ability to perform the required work, available resources, past performance, and other relevant criteria. This step helps ensure that only capable and reliable contractors are invited to bid, which can mitigate the risks of contractors dropping out, underperformance, and the perception of ineffectiveness. Additionally, it can increase the chances of receiving competitive bids that meet the desired value. References:
* "Contractor's Guide to Change Orders" by Andrew M. Civitello Jr.
* "Construction Contracting: A Practical Guide to Company Management" by Richard H. Clough, Glenn A. Sears, and S. Keoki Sears


NEW QUESTION # 75
On an income statement, net sales minus cost of goods sold equals:

  • A. net income.
  • B. gross profit.
  • C. operating income.
  • D. pretax profit.

Answer: B


NEW QUESTION # 76
A supply manager is seeking waterproofing consulting services to be used in the construction of a critical materials warehouse. It is the firm's first time procuring this type of service. Given this situation, the supply manager would be BEST served by

  • A. hiring a staffing agency
  • B. subcontracting the work to the general contractor
  • C. Identifying preferred consultants
  • D. preparing a flexible scope of work

Answer: C

Explanation:
For a firm procuring waterproofing consulting services for the first time:
* Preparing a flexible scope of work: Flexibility can be useful but may lead to ambiguity and lack of focus.
* Identifying preferred consultants: Researching and identifying consultants with proven expertise ensures the firm selects qualified professionals, especially critical for a first-time procurement.
* Hiring a staffing agency: Typically used for temporary staff rather than specialized consulting services.
* Subcontracting the work to the general contractor: Effective for general construction tasks but might not guarantee specialized waterproofing expertise.
Given the critical nature of the service and the firm's inexperience, the best course of action is to identify preferred consultants with expertise in waterproofing.
References:
* Procurement strategy literature on consulting services.
* Industry best practices for selecting specialized consultants.


NEW QUESTION # 77
......

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