CFCM Terminations 4

Question 1

The 'loss ratio' adjustment in termination settlements under FAR 49.203 is applied when:

Accepted Answer

The contractor would have incurred a loss on the contract if fully performed

Answer

FAR 49.203 requires a loss adjustment to prevent a contractor from recovering more under a termination than it would have earned completing a loss contract.

Question 2

Under FAR 49.501, termination for convenience clauses in service contracts allow settlement for:

Accepted Answer

Costs incurred, profit on work done, and reasonable settlement costs

Answer

FAR 49.501 settlement principles for service contracts allow recovery of incurred costs, profit on completed work, and reasonable costs of the settlement itself.

Question 3

When the government terminates a contract for default and the reprocurement price is LOWER than the defaulted contract price, the contractor:

Accepted Answer

Owes nothing and the government keeps the savings

Answer

When reprocurement costs are lower, the government retains the savings; the defaulted contractor has no claim to them.

Question 4

FAR 49.402-1 states that a termination for default is appropriate when the contractor fails to:

Accepted Answer

Make progress endangering performance, or fails to perform any contract provision

Answer

FAR 49.402-1 identifies failure to deliver, failure to make progress, or failure to perform any contract provision as grounds for default.

Question 5

A 'partial termination' under FAR 49.208 refers to termination of:

Accepted Answer

A portion of the contract work or deliverables, with the remainder continuing

Answer

A partial termination cancels only a portion of the contract scope while the unterminated portion continues performance.

(CFCM) Certified Federal Contracts Manager Practice Test

(CFCM) Certified Federal Contracts Manager Practice Test

CFCM Terminations 4