CEM Equipment Acquisition & Disposal 3

Question 1

Which type of equipment acquisition agreement transfers ownership to the buyer at the end of the contract term for a nominal fee?

Accepted Answer

Capital lease (finance lease)

Answer

A capital lease is structured so the lessee assumes substantially all ownership risks and rewards, with title transferring at lease end.

Question 2

An exhibition company discovers that a competitor is selling used truss systems at auction. Before bidding, what is the most critical due diligence step?

Accepted Answer

Obtain and review the maintenance and inspection records

Answer

Maintenance and inspection history reveals structural integrity, prior damage repairs, and compliance with safety standards for rigging equipment.

Question 3

Under the Uniform Commercial Code (UCC), risk of loss for shipped equipment typically transfers to the buyer when?

Accepted Answer

The seller ships the goods (FOB shipping point)

Answer

Under FOB shipping point terms, risk of loss passes to the buyer once the seller delivers goods to the carrier.

Question 4

Which environmental regulation most directly affects the disposal of fluorescent lighting used in exhibition displays in the U.S.?

Accepted Answer

EPA Universal Waste Rule

Answer

The EPA Universal Waste Rule governs disposal of mercury-containing lamps including fluorescents, requiring proper recycling or disposal.

Question 5

What is a 'blanket purchase order' and how does it benefit exhibition equipment procurement?

Accepted Answer

A standing agreement allowing repeated orders from a vendor at pre-negotiated prices

Answer

Blanket POs lock in pricing and terms for a set period, reducing administrative burden and ensuring supply availability for recurring equipment needs.

(CEM) Certified in Exhibition Management Practice Test

(CEM) Certified in Exhibition Management Practice Test

CEM Equipment Acquisition & Disposal 3