Practice Test Geeks(FCC) Federal Contracting Certification Practice Test
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Contract Types: FFP, T&M, CPFF Flashcards

7 cards from real FCC practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Contract Types: FFP, T&M, CPFF flashcards as text

  1. A Labor-Hour (LH) contract differs from a Time-and-Materials (T&M) contract primarily because:

    Answer: LH contracts do not provide for the delivery of materials by the contractor

    A Labor-Hour contract is a variant of T&M that covers only labor—it does not include contractor-furnished materials as part of the contract.

  2. The statutory limit on the fixed fee in a CPFF contract for experimental, developmental, or research work is:

    Answer: 10% of estimated cost

    10 U.S.C. 3322 and 41 U.S.C. 3905 limit the fixed fee on CPFF contracts for experimental, developmental, or research work to 10% of estimated cost.

  3. Under an FFP contract, what is the government's primary financial obligation once the contract is awarded?

    Answer: To pay the agreed-upon price upon satisfactory delivery

    The government simply pays the fixed contract price upon acceptance of conforming deliverables—no cost auditing or reimbursement of individual cost elements is required.

  4. Which clause is REQUIRED in all cost-reimbursement contracts, including CPFF, to establish allowable cost rules?

    Answer: FAR 52.216-7 (Allowable Cost and Payment)

    FAR 52.216-7, Allowable Cost and Payment, is the core clause in cost-reimbursement contracts that governs how costs are billed and what constitutes an allowable cost.

  5. A contracting officer is concerned that a T&M contract ceiling will be reached before work is complete. What must the contractor do?

    Answer: Stop work immediately when costs reach 85% of the ceiling and notify the CO

    FAR 52.232-7 requires the contractor to notify the contracting officer when costs reach a specified threshold (often 85%) of the ceiling so the government can authorize additional funds or stop work.

  6. For which type of work is CPFF most commonly justified under FAR Part 16?

    Answer: Research and development where requirements cannot be defined at award

    CPFF is appropriate for research and development or other efforts where the work scope cannot be sufficiently defined to permit use of a fixed-price contract.

  7. An FFP contract's price includes the contractor's estimate of costs PLUS:

    Answer: The contractor's desired profit margin

    An FFP price is an all-in figure reflecting the contractor's cost estimate plus whatever profit margin it negotiates or prices into the fixed amount.