Cost & Pricing Analysis Flashcards
7 cards from real SSO practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Cost & Pricing Analysis flashcards as text
When calculating the total cost of a ship security drill, which indirect cost is most commonly overlooked?
Answer: Administrative overhead and planning time
Administrative overhead and planning time are indirect costs frequently omitted from drill cost calculations despite being significant contributors to total expenditure.
A Ship Security Officer receives quotes from three vendors for CCTV maintenance: $4,200, $3,800, and $5,100. What is the average (mean) quote price?
Answer: $4,367
The mean is ($4,200 + $3,800 + $5,100) / 3 = $13,100 / 3 = $4,366.67, rounded to $4,367.
Which pricing model is most appropriate when procuring long-term security equipment maintenance contracts under ISPS Code requirements?
Answer: Time-and-materials with a not-to-exceed cap
A time-and-materials contract with a not-to-exceed cap provides cost control while accommodating variable maintenance needs typical in long-term security equipment upkeep.
An SSO must justify a $15,000 security system upgrade to management. Which financial metric best demonstrates long-term value?
Answer: Return on investment (ROI) over 5 years
ROI over a defined period quantifies the financial benefit relative to cost, making it the most persuasive metric for capital expenditure justification.
Under US maritime regulations, when competitive bidding is required for security service contracts, what is typically the minimum number of bids that must be solicited?
Answer: Three
US federal procurement guidelines and most company policies require a minimum of three competitive bids to ensure fair pricing and prevent sole-source abuse.
A vessel's security budget shows a 12% variance between planned and actual spending. Which action should the SSO take first?
Answer: Identify and document the root cause of the variance
Identifying the root cause of budget variance is the essential first step before any corrective or reporting action can be appropriately taken.
Which cost classification describes the salary of a dedicated Ship Security Officer employed full-time aboard a vessel?
Answer: Fixed cost
A full-time SSO salary does not change with operational output or voyage frequency, making it a fixed cost within the vessel's operating budget.