AFP AFP-CTP Online Practice Questions and Exam Preparation

AFP AFP-CTP Online Questions & Answers

• Question 431:

  A company in the market to purchase a treasury management system (TMS) has issued a request for proposal to evaluate various vendors. One of the evaluation factors focuses on the long-term viability of the vendor. The company may have to choose between an untested new vendor with a superior product and an established vendor with an incomplete product suite. This dimension of the RFP is measuring what type of risk?

  A. Reputational risk
  B. Supplier risk
  C. Technology risk
  D. Financial risk
  B. Supplier risk

• Question 432:

  Which of the following is an example of using cash forecasting for liquidity management?

  A. Establishing an accounts receivable collection schedule
  B. Scheduling investment maturities
  C. Assessing the degree of foreign currency exposure
  D. Determining a company's target capital structure
  B. Scheduling investment maturities

• Question 433:

  A bank's reserve requirement on demand deposits is 10%, and its earnings credit rate is 6%. If a company uses bank services amounting to $2,600 and has an excess of $550 in earnings credit, what is the average collected balance in the account based on a 30-day month?

  A. $123,921
  B. $461,889
  C. $585,810
  D. $709,731
  D. $709,731

• Question 434:

  Company A is a large public company with annual revenue of $1.2 billion and high fixed costs. Its stock is listed on the New York Stock Exchange. Company B is a mid-sized company with annual revenue of $100 million and low fixed costs. Its stock is listed on the NASDAQ. Which of the following statements is MOST LIKELY to be true when comparing Company A and Company B?

  A. Company A has greater reporting requirements and more marketable stock than Company B.
  B. Company A has greater reporting requirements and less marketable stock than Company B.
  C. Company B has greater reporting requirements and more marketable stock than Company A.
  D. Company B has greater reporting requirements and less marketable stock than Company A.
  A. Company A has greater reporting requirements and more marketable stock than Company B.

• Question 435:

  Fluctuations in interest rates and the availability of funds are more significant risks for companies that rely on:

  A. short-term borrowing for long-term uses.
  B. short-term borrowing for short-term uses.
  C. long-term borrowing for long-term uses.
  D. long-term borrowing for short-term uses.
  A. short-term borrowing for long-term uses.

• Question 436:

  Which of the following are reasons for companies to use controlled disbursement? I.To obtain timely check presentment information II.To enhance supplier relationships III.To increase their available cash IV.To improve their overall creditworthiness

  A. I and III only
  B. II and IV only
  C. I, III, and IV only
  D. I, II, III, and IV
  A. I and III only

• Question 437:

  In a large company, the financial planning function typically falls directly under the responsibility of the:

  A. treasurer.
  B. controller.
  C. chief executive officer.
  D. chief internal auditor.
  B. controller.

• Question 438:

  What is one chief advantage of issuing short-term securities in book-entry form?

  A. The securities cannot be transferred electronically.
  B. The physical exchange of certificates is required.
  C. Transaction clearing can be performed with ease and speed.
  D. Security registration is not required.
  C. Transaction clearing can be performed with ease and speed.

• Question 439:

  Regarding dividends, on which of the following dates would a company's current assets be reduced?

  A. Declaration date
  B. Ex-dividend date
  C. Payment date
  D. Record date
  C. Payment date

• Question 440:

  Who has responsibility for final approval of treasury policies that have a significant impact on the organization?

  A. The board of directors
  B. The chief financial officer
  C. The treasurer
  D. The audit committee
  A. The board of directors