AFP AFP-CTP Online Practice Questions and Exam Preparation

AFP AFP-CTP Online Questions & Answers

• Question 651:

  When investing in commercial paper, the investor's primary consideration should be which of the following?

  A. Issuer's credit rating
  B. Method of settlement
  C. Interest rate risk
  D. Dealer used
  A. Issuer's credit rating

• Question 652:

  A lender is evaluating the creditworthiness of a company that has high levels of operating leverage. In determining the debt capacity of the company, the bank would MOST LIKELY prefer a:

  A. high total liabilities to total assets ratio.
  B. high debt to tangible net worth ratio.
  C. low long-term debt to capital ratio.
  D. low times interest earned ratio.
  C. low long-term debt to capital ratio.

• Question 653:

  Which of the following actions would the CFO of a Canadian multinational conglomerate MOST LIKELY take to repatriate profits from its international subsidiaries?

  A. Re-invoicing
  B. Multilateral netting
  C. Unbundle cash flows
  D. Pooling
  C. Unbundle cash flows

• Question 654:

  When a supplier uses evaluated receipts settlement (ERS), which of the following statements is true?

  A. The supplier does not send an invoice.
  B. The customer selects the payment date.
  C. Payment must be made before goods can be shipped.
  D. Payables are processed manually.
  A. The supplier does not send an invoice.

• Question 655:

  A company's overall cost of capital depends on the:

  A. mix of long term debt and equity, and the cost of each.
  B. weighted average cost of interest expense and dividends.
  C. cost associated with debt and expected dividend returns.
  D. WACC of the industry of which the company is part.
  A. mix of long term debt and equity, and the cost of each.

• Question 656:

  Treasury uses all of the following types of internal information EXCEPT:

  A. projected weekly sales.
  B. security safekeeping activity.
  C. large outstanding collection items.
  D. debt repayment schedule.
  B. security safekeeping activity.

• Question 657:

  Account analysis statements should be examined for which of the following reasons?

  I. To verify volumes processed

  II. To determine daily cash shortages

  III. To verify the accuracy of bank service charges

  IV.

  To ensure that company-initiated transactions have occurred

  A. I and IV only
  B. I and III only
  C. II and III only
  D. II and IV only
  I. To verify volumes processed II. To determine daily cash shortages III. To verify the accuracy of bank service charges IV. To ensure that company-initiated transactions have occurred
  B. I and III only

• Question 658:

  Which of the following activities creates administrative costs associated with a concentration system?

  A. Scheduling cash transfers
  B. Monitoring short-term investments
  C. Reviewing positive pay exception reports
  D. Centralizing the check issuance process
  A. Scheduling cash transfers

• Question 659:

  On a company's financial statements, an increase in accounts receivable is reflected as a(n):

  A. decrease in current assets.
  B. increase in current liabilities.
  C. source of cash on the cash flow statement.
  D. use of cash on the cash flow statement.
  D. use of cash on the cash flow statement.

• Question 660:

  A multinational company may use which of the following to locate profits in subsidiaries in low-tax countries?

  A. Dividends
  B. Transfer pricing
  C. Management fees
  D. Intracompany loans
  B. Transfer pricing