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L4M3 Commercial Contracting is now Stable and With Pass Result | Test Your Knowledge for Free

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L4M3 Practice Questions

Commercial Contracting

Last Update 3 days ago
Total Questions : 233

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Our free CIPS Level 4 Diploma in Procurement and Supply practice questions crafted to reflect the domains and difficulty of the actual exam. The detailed rationales explain the 'why' behind each answer, reinforcing key concepts about L4M3. Use this test to pinpoint which areas you need to focus your study on.

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Question # 51

Bandpro is a reseller of branded computer products to the private and public sector. The procurement team must purchase 500 items each day solely by multiple phone calls and emails to suppliers. Due to this practice, it takes a lot of time to track and collect relevant documents.Some important documents even get lost, which makes procurement audit more burdensome. Which of the following would increase the robustness of audit trails in procurement activities?

Options:

A.  

Every evidence must be recorded by paper

B.  

Adopt e-procurement

C.  

Spend less time on auditing procurement procedures

D.  

Rectify non-compliant activities

Discussion 0
Question # 52

Which of the following are good examples of a Key Performance Indicator?

The total number of services provided

Reduction rate in goods or services

Complaints resolved within two days

Delivery of goods on time and in full

Options:

A.  

1 and 2 only

B.  

2 and 3 only

C.  

3 and 4 only

D.  

2 and 4 only

Discussion 0
Question # 53

A procurement professional is drafting payment terms for a commercial contract. He is considering about payment method if defective products are found. Which of the following should be embedded in payment terms to control this issue?

Options:

A.  

Remedies for late payment

B.  

Pay-less notice

C.  

Invoice preparation

D.  

Retention clause

Discussion 0
Question # 54

Which of the following is the reason why liquidated damage clauses are embedded into a contract?

Options:

A.  

Because liquidated damages are the only remedy

B.  

To penalise the supplier for their wrongdoing

C.  

To avoid argument on correct measure of damage

D.  

Because compensation will be awarded immediately

Discussion 0
Question # 55

Maximum Score 1

Denny is putting together the final version of a contract to send out to a supplier. He places certain documentation into additional contract schedules at the end of the main contract.

Which of the following would be suitable inclusions to the additional schedules? Select TWO that apply.

Options:

A.  

Financial statements

B.  

Health and safety commitments

C.  

Suppliers references

D.  

Non-disclosure agreement

E.  

A blank RFQ form

Discussion 0
Question # 56

Which of the following would be steps in the preparation of an invitation to tender? Select TWO that apply.

Options:

A.  

Re-writing a model form contract

B.  

Creating a detailed specification

C.  

Learning International Standards

D.  

Advertising the requirement

E.  

Publishing your company's financial reports

Discussion 0
Question # 57

A school has a contract for the supply of fruit for break time. The school needs the fruit delivered by 10am every morning to be served at 10:30am. How would this best be covered in a commercial agreement?

Options:

A.  

Note on each purchase order

B.  

Pricing schedule

C.  

Sales of Goods Act 1974

D.  

Contractual term

Discussion 0
Question # 58

Which of the following is the international standard for labelling hazardous substances?

Options:

A.  

GPS

B.  

HSE

C.  

CODEX STAN 1-1985

D.  

GHS

Discussion 0
Question # 59

Company A buys a lorry from Company B on hire purchase. During the contractual period, Company A makes default in paying the instalment. Company B has...?

Options:

A.  

The right to take repossession of the lorry

B.  

The option to repossess the lorry

C.  

No right to take repossession

D.  

Company B has to approach the court

Discussion 0
Question # 60

Is a verbal contract legally enforceable?

Options:

A.  

Yes, a verbal agreement is just as legally enforceable as a written one

B.  

Yes, but only if you have a witness at the time the verbal agreement was made

C.  

No, only contracts in writing will be legally enforceable

D.  

No, verbal contracts are never legally enforceable

Discussion 0
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