Question No. 1

Which of the following best describes the term 'retention money'?

AA contractual arrangement where the buyer withholds a sum of money as an incentive for the supplier to complete all of the required work

BA contractual arrangement where the buyer agrees to pay the supplier at prescribed stages during the course of the contract

CA contractual arrangement where it is agreed that the buyer can delay payment over and above the usual invoice settlement period

DA contractual arrangement where it is agreed that the buyer will pay the seller in a currency other than that of its own country.

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Correct Answer: B

Question No. 2

Which of the following should be carried out before passing an invoice for payment?

ACheck that the details of the invoice match those of the purchase order and delivery note

BCheck that the purchasing company has enough money to pay for the goods

CCheck that the accounts department is able to settle the invoice in accordance with the required payment method

DCheck that the suppliers bank account details are on the invoice.

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Correct Answer: B

Question No. 3

Which one of the following best describes the requirement of the Sale of Goods Act 1979 regarding sale by description?

AThe buyer has a duty to describe their requirements clearly on the request for quotation (RFQ) and/or purchase order

BThe seller has a duty to ensure that any paperwork accompanying the goods contains a clear description of them

CThere must be a clear stipulation on the purchase order if the buyer wishes the bulk of the goods to correspond to any description used

DThere is an implied condition that the goods supplied must correspond to any description used.

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Correct Answer: B

Question No. 4

Which of the following best describes the term 'progress payments'?

AA series of payments made at prescribed stages during the contract, usually linked to work satisfactorily completed

BA payment withheld for a period of time after the end of the contract period to ensure satisfactory completion of the contract

CA payment made in advance of the supplier commencing work to enable materials to be purchased

DA payment made to an international supplier using a currency of the suppliers choice.

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Correct Answer: C

Question No. 5

Which of the following is the stipulation of the FCA Incoterm regarding costs?

AThe supplier pays for all costs of delivery of the goods alongside ship on the quay

BThe supplier pays for all costs and freight to the named destination port

CThe supplier pays for all costs and freight to the named frontier place

DThe supplier pays for all costs up to the point of delivery to a named carrier.

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Correct Answer: A

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