Supply Chain Management Professional (SCMP) · Question
A purchase order (PO) typically becomes a legally binding contract when:
A PO becomes a legally binding contract once the supplier accepts its terms and conditions, forming an agreement between the buyer and seller.
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Question: A purchase order (PO) typically becomes a legally binding contract when:
Answer options:
- It is issued by the buyer. ✅ The supplier acknowledges and accepts the PO.
- The goods are delivered.
- Payment is made by the buyer.
Correct answer: The supplier acknowledges and accepts the PO.
Explanation: A PO becomes a legally binding contract once the supplier accepts its terms and conditions, forming an agreement between the buyer and seller.
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