AFP AFP Certification CTP Questions & Answers

• Question 31:

  Which of the following ASC X12 transactions is used to confirm the receipt and compliance of transmitted sets?

  A. 821

  B. 822

  C. 835

  D. 997

  Correct Answer: D

• Question 32:

  A multinational corporation with many FSPs requires a TMS that can display extensive and complex information in an effective manner. The corporation will be looking for a TMS with what functionality?

  A. Bank administration

  B. Dashboards

  C. Data integration

  D. Modularity

  Correct Answer: B

• Question 33:

  To monitor financial institution service quality, a company would use all of the following measures EXCEPT:

  A. report cards.

  B. an earnings allowance rate.

  C. annual senior management reviews.

  D. informal reviews on day-to-day relationship management.

  Correct Answer: B

• Question 34:

  Which scenario provides the BEST example of an agency problem?

  A. A CFO hires an independent auditor to review the company's balance sheet.

  B. A Treasurer accepts a free round of golf from a banker.

  C. An account manager approves a risky loan in order to meet a salary incentive.

  D. A CEO is close friends with a competitor's CEO.

  Correct Answer: C

• Question 35:

  An employee who became vested in his/her employer's retirement plan upon reaching five years of service decides to resign after working for seven years.

  

  However, he/she will not reach retirement age for another six years. Referring to the employee's annual earnings above, if the plan is structured as a cash balance plan, what is the value of the employee's plan if benefits accrued at 8% per year and future annual salary inflation is 3%?

  A. $0

  B. $34,720

  C. $42,000

  D. $50,150

  Correct Answer: B

• Question 36:

  A cash manager wants to convert wire payments to ACH. Which of the following would NOT be a good application for ACH?

  A. Routine loan payments

  B. Lease payments

  C. Same day payments

  D. Future tax payments

  Correct Answer: C

• Question 37:

  The company's monthly credit sales are in Table 1.

  

  The company's receivables collection pattern is in Table 2. If this company's accounts receivable on March 31 is $0, what would the accounts receivable balance be at the end of July? Assume a 90-day quarter.

  A. $845,000

  B. $1,205,000

  C. $1,545,000

  D. $1,580,000

  Correct Answer: C

• Question 38:

  Which of the following is LEAST likely to appear on an account analysis?

  A. Service charges

  B. Average float balance

  C. Earnings allowance rate

  D. Money market rate

  Correct Answer: D

• Question 39:

  Company Sales Figures:

  10% of sales collected in the current month of the sale 45% of sales collected in the month after the sale 30% of sales collected two months after the sale 15% of sales collected three months after the sale January Sales $300,000 February Sales $250,000 March Sales $400,000 April Sales $450,000 Based on the information above, what is the estimate for the company's April cash flows?

  A. $330,000

  B. $345,000

  C. $1,055,000

  D. $1,070,000

  Correct Answer: B

• Question 40:

  An employee is considering two investment strategies for his 401(k) plan:

  Strategy #1: Invest all contributions in a money market fund that has returned 5% annually

  Strategy #2: Invest all contributions in a stock fund that has returned 9% on average, although annual returns have varied between (2%) and 12%

  Assuming that the employee makes a one-time investment of $12,000 and that both strategies continue to perform as they have historically, how much more or less could the stock fund be worth after one year compared to the money market fund?

  A. Between ($480) and $480

  B. Between ($840) and $840

  C. Between ($1,080) and $1,080

  D. Between ($1,680) and $1,680

  Correct Answer: B