CBP Subcontractor and Vendor Management 2

Question 1

What is 'bid leveling' in the subcontractor selection process?

Accepted Answer

Adjusting received bids to a common scope basis so they can be fairly compared

Answer

Requiring all subcontractors to submit bids on identical forms

Answer

Averaging all received bids to establish the contract price

Answer

Eliminating the highest and lowest bids before selection

Question 2

When a superintendent verbally directs a subcontractor to perform additional work outside the contracted scope without issuing a formal written change order, this is known as a:

Accepted Answer

Constructive change

Answer

Cardinal change

Answer

Unilateral modification

Answer

Implied waiver

Question 3

Which scheduling method is most commonly used to sequence and coordinate multiple subcontractor trades on a complex construction project?

Accepted Answer

Critical Path Method (CPM)

Answer

Bar chart (Gantt chart)

Answer

Resource leveling

Answer

Linear scheduling method

Question 4

A 'flow-down clause' in a subcontract agreement means that:

Accepted Answer

The applicable terms and obligations of the prime contract are incorporated into and binding on the subcontract

Answer

The GC guarantees payment to the sub regardless of whether the owner pays the GC

Answer

The subcontractor must provide payment bonds to all material suppliers

Answer

Risk flows downward to the lowest-tier subcontractor on the project

Question 5

What is the primary effect of a 'pay-when-paid' clause in a subcontract agreement?

Accepted Answer

It makes the GC's obligation to pay the subcontractor contingent upon first receiving payment from the owner

Answer

It requires the GC to pay the subcontractor before receiving payment from the owner

Answer

It establishes a fixed monthly payment schedule regardless of project progress

Answer

It requires retainage to be released at substantial completion

Question 6

Which of the following amounts is typically withheld from each subcontractor progress payment as financial security to ensure project completion?

Accepted Answer

Retainage

Answer

Liquidated damages reserve

Answer

Performance bond premium

Answer

Overhead and profit markup

Question 7

A subcontractor's 'schedule of values' serves what primary purpose in the payment application process?

Accepted Answer

To allocate the subcontract sum among specific portions of work so that progress payments can be calculated proportionally

Answer

To list all labor and material costs in separate line items for audit purposes

Answer

To establish the sequence of work activities for schedule coordination

Answer

To document promised delivery dates for major material purchases