AFP AFP-CTP Online Practice Questions and Exam Preparation

AFP AFP-CTP Online Questions & Answers

• Question 531:

  Transmission of a file of items presented for payment by the payor bank to the issuing company is known as:

  A. reverse positive pay.
  B. positive pay.
  C. full reconciliation.
  D. payor bank services.
  A. reverse positive pay.

• Question 532:

  Which of the following is a KEY operational advantage of short-term debt?

  A. It can be arranged quickly and easily.
  B. It improves the current ratio for debt covenant and compliance purposes.
  C. It reduces the risk of interest rate fluctuation and lowers interest expense.
  D. It improves the overall liquidity position and reduces risk.
  A. It can be arranged quickly and easily.

• Question 533:

  XYZ Company's cash manager is evaluating cash concentration transfer options. The company has an 8% cost of funds and $50,000 in average daily field cash receipts. The wire transferresults in the transfer of funds one day faster. Which of the following options correctly ranks the transfer choices from most cost-effective to least cost-effective? 1.Electronic depository transfer costing $1.00 2.Electronic depository transfer costing $2.50 3.Wire transfer costing $8.00 4.Wire transfer costing $15.00

  A. 1, 2, 3, 4
  B. 1, 3, 2, 4
  C. 3, 1, 2, 4
  D. 3, 4, 1, 2
  C. 3, 1, 2, 4

• Question 534:

  ABC Company is considering investing in new production technology. ABC has projected that the investment would add $5,000,000 in additional operating profit and that the resulting balance sheet would show $7,000,000 in long-term debt and $11,000,000 in total equity. ABC has a 34% tax rate and a 10% WACC. Which of the following is the investment's EVA?

  A. $1,500,000
  B. $2,200,000
  C. $3,300,000
  D. $3,500,000
  A. $1,500,000

• Question 535:

  The time from the deposit of a check in a bank account until the funds can be used by the payee is known as:

  A. collection float.
  B. mail float.
  C. processing float.
  D. availability float.
  D. availability float.

• Question 536:

  Check MICR line information includes which of the following? I.Bank of deposit identification number II.Payee bank identification number III.Federal Reserve bank code IV.Payor's account number

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

• Question 537:

  When a foreign subsidiary pays a dividend to its parent company the transfer of funds may be subject to:

  A. turnover tax.
  B. lifting fees.
  C. capital tax.
  D. netting fees.
  B. lifting fees.

• Question 538:

  A good credit rating has which of the following effects on debt?

  I. Improved marketability

  II. Decreased cost of funds

  III. Decreased maturity

  IV.

  Increased dealer fees

  A. I and IV
  B. I and II
  C. II and III
  D. I, II, and III
  I. Improved marketability II. Decreased cost of funds III. Decreased maturity IV. Increased dealer fees
  B. I and II

• Question 539:

  Which of the following is responsible for examining national banks?

  A. The Federal Reserve
  B. The Federal Deposit Insurance Corporation
  C. The Office of the Comptroller of the Currency
  D. The Securities and Exchange Commission
  C. The Office of the Comptroller of the Currency

• Question 540:

  A currency is said to trade at a discount if it is worth:

  A. less than its face value.
  B. less in the forward market than in the spot market.
  C. less in the futures market than in the forward market.
  D. less today than one year hence.
  B. less in the forward market than in the spot market.