AFP AFP-CTP Online Practice Questions and Exam Preparation

AFP AFP-CTP Online Questions & Answers

• Question 331:

  A company can use all of the following documents to establish a relationship with a bank EXCEPT:

  A. account analysis statements.
  B. account resolutions.
  C. service agreements.
  D. signature cards.
  A. account analysis statements.

• Question 332:

  DGB Inc.'s CEO and founder retired shortly after the company went public two years ago. DGB Inc. has recently struggled, and the founder has agreed to return as an independent director. What violation, if any, has occurred?

  A. The cooling-off period has not been met.
  B. Section 404 of the Sarbanes-Oxley Act has been violated.
  C. ERISA disclosure requirements have not been met.
  D. No violation has occurred.
  A. The cooling-off period has not been met.

• Question 333:

  JMW Company processes its consumer payments using a lockbox provider. On average 35% of its remittance advices contain encoding errors. JMW Company's cost for the lockbox provider to process these payments will be least impacted if it uses:

  A. wholesale lockbox.
  B. hybrid lockbox.
  C. direct lockbox.
  D. retail lockbox.
  B. hybrid lockbox.

• Question 334:

  A retail company is performing a risk analysis on its accepted payment types. Cash is the primary form of payment for this retailer. What is the PRIMARY issue with cash payment systems?

  A. Weight of cash
  B. Cost of processing
  C. Security and integrity
  D. Cash-based accounting practices
  C. Security and integrity

• Question 335:

  Company XYZ uses exponential smoothing to forecast its daily lockbox receipts. With the help of a statistical computer program, the company has determined that the smoothing constant is 0.35.

  

  Using the data in the table, what is the exponential smoothing forecast for Day 7 (rounded to the nearest whole $)?

  A. $26,600
  B. $27,167
  C. $27,790
  D. $28,810
  C. $27,790

• Question 336:

  A company transmits a payment file of ACH and Fedwire vendor payments to its financial institution to execute. Which article of the Uniform Commercial Code governs these payments?

  A. Article 3
  B. Article 4
  C. Article 4A
  D. Article 5
  C. Article 4A

• Question 337:

  In most countries other than the United States, which of the following is used to compensate banks for services provided?

  A. Value dating
  B. Automatic overdraft services
  C. Giro systems
  D. Bilateral netting
  A. Value dating

• Question 338:

  During the 1970s, many companies instituted dividend reinvestment plans (DRIPS). There are many benefits of this plan. What is the one negative aspect?

  A. Reduces the expense of shareholder relations
  B. Leads to an increase in the number of small shareholders
  C. Does not allow automatic reinvestment of dividends
  D. Leads to a reduction in the number of small shareholders
  B. Leads to an increase in the number of small shareholders

• Question 339:

  One example of increased use of electronic payments for retail businesses to convert customer checks to cash at the counter more quickly is:

  A. BOC.
  B. POP.
  C. ARC.
  D. POD.
  B. POP.

• Question 340:

  An equity management company's Chief Financial Officer and Treasurer are evaluating their corporate investments and decide that they need to diversify their stock holdings to include personal care products companies. Based on their analysis, publicly-traded companies A and B stand out as choices. Company A has a beta value of 0.65 while company B has a beta value of 1.10. They decide to invest in Company A. What objective of their investment policy did they use to make their decision?

  A. Safety
  B. Liquidity
  C. Exposure horizon
  D. Risk/return trade-off
  A. Safety