Which external document indicates types, quantities and agreed prices?

Which external document indicates types, quantities and agreed prices?

• A. Purchase Requisition
• B. Purchase Order
• C. RFI
• D. Contracting

Answer: (B)

Understanding what each procurement document contains helps distinguish their roles. The purchase order is the external document sent to a supplier that specifies exactly what is being purchased: the types of goods or services, the quantities to be delivered, and the prices agreed upon. It formalizes the buyer’s instructions and, once accepted by the supplier, becomes a binding commitment for the transaction, often including delivery terms and payment terms as well. A purchase requisition is an internal request within the organization to procure items and typically does not set prices or names a supplier. A request for information is about gathering basic data and does not commit to a purchase. A contracting document outlines terms for a broader or longer-term relationship and may cover multiple orders rather than a single shipment with specific quantities and prices.

Understanding what each procurement document contains helps distinguish their roles. The purchase order is the external document sent to a supplier that specifies exactly what is being purchased: the types of goods or services, the quantities to be delivered, and the prices agreed upon. It formalizes the buyer’s instructions and, once accepted by the supplier, becomes a binding commitment for the transaction, often including delivery terms and payment terms as well.

A purchase requisition is an internal request within the organization to procure items and typically does not set prices or names a supplier. A request for information is about gathering basic data and does not commit to a purchase. A contracting document outlines terms for a broader or longer-term relationship and may cover multiple orders rather than a single shipment with specific quantities and prices.