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AFP CTP - Certified Treasury Professional

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Page: 10 / 17
Total 1076 questions

A company may choose to use a derivative to reduce risk on which of the following types of exposure?

I. Currency

II. Interest rate

III. Commodity price

A.

I and II only

B.

I and III only

C.

II and III only

D.

I, II, and III

Under an operating lease, possible benefits to the lessee include which of the following?

I. It requires no initial capital outlay.

II. It can be structured as an off-balance-sheet item.

III. It can offer tax advantages.

A.

I only

B.

I and II only

C.

II and III only

D.

I, II, and III

When establishing a retail collection system that accepts consumer debit cards, a company must comply with which Federal Reserve regulation?

A.

CC

B.

D

C.

E

D.

Q

What step can a cash manager take to validate a cash flow forecast?

A.

Calculate variances between actual and predicted depreciation.

B.

Test the model using data that was not used to develop it.

C.

Compare estimated sales to actual income.

D.

Compare estimated tax payments to actual payments.

Which of the following global cash concentration methods would be MOST appropriate for a company with operations in the United States, Germany, Mexico, and Japan?

A.

National pooling

B.

Bank overlay structure

C.

Notional pooling

D.

Physical pooling

I. Banker’s acceptances

II. Commercial paper

III. U.S. Treasury bills

IV. Federal agency securities

Which of the following is the MOST usual ranking, from lowest to highest risk, of the investments listed above?

A.

I, III, IV, II

B.

III, IV, I, II

C.

IV, II, III, I

D.

IV, III, II, I

Merchant XYZ has total credit card sales of $20,000 for one day with an average ticket of $200. The merchant’s interchange reimbursement fees are 2% and transactions fees are $0.05. This merchant receives net settlement. Which of the following is the value of the deposit for that day?

A.

$19,595

B.

$19,600

C.

$19,995

D.

$20,000

A merchant presents 2 different batches of credit card transactions for processing, each batch has the same dollar value and number of transactions, but the fees are different. Which of the following explains why?

A.

Use of a different terminal

B.

Goods or services sold

C.

Type of card accepted

D.

Time of batch closure

Financial risk management requires monitoring changes in which of the following?

I. Interest rates

II. Foreign exchange rates

III. Commodity prices

IV. Cost of insurance

A.

II and IV only

B.

I, II, and III only

C.

I, III, and IV only

D.

I, II, III, and IV

Which of the following types of payments would NOT be included in cash flow forecasting?

A.

Sight drafts

B.

Returned items

C.

Direct deposit

D.

Notional transfers

XYZ Company is considering the purchase of a security that generates a tax equivalent yield of 10% and a tax exempt yield of 7.1%. What is XYZ's marginal investment tax rate?

A.

29.0%

B.

36.1%

C.

40.8%

D.

61.0%

A cash manager's recommendation to use procurement cards as a way to reduce accounts payable expense is an example of:

A.

benchmarking.

B.

outsourcing.

C.

re-engineering.

D.

re-invoicing.

XYZ Corporation is presently a short-term borrower and uses a revolving line of credit with an interest rate of 7%. The Treasurer would like to reduce interest expense and increase liquidity without renegotiating the line of credit. Which of the following projects should the Treasurer support in order to achieve this objective as quickly as possible?

A.

Store operations believes that an increase in inventory levels will raise sales as the corporation eventually becomes known for its wide selection.

B.

Purchasing is trying to extend terms from net 30 to net 60 with one of their primary vendors. The vendor will agree if XYZ concentrates purchases with them.

C.

Accounts receivable is spending capital to improve its collection system. With the faster collections that will result, it anticipates recovering the outflows over a two-year period.

D.

One large store is being remodeled. When complete, it should generate sufficient additional sales within one year to cover the capital expenditure and produce a positive return on investment.

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.

All of the following factors influence a company's decision to use electronic commerce EXCEPT:

A.

increased accuracy.

B.

increased inventory levels.

C.

increased information flow.

D.

redefined customer and supplier relationships.

All of the following are account reconciliation services EXCEPT:

A.

sort only.

B.

full reconciliation.

C.

payor bank services.

D.

positive pay services.

Which of the following ACH formats is commonly used for consumer payments such as deposits of payroll?

A.

CCD

B.

CTX

C.

PPD

D.

TXP

"Fees" in Country Y, which would be considered bribes in the United States, are ingrained in the commercial culture. A U.S. company doing business in Country Y:

A.

may have moral but not legal issues with paying "fees" in Country Y.

B.

is prohibited by U.S. law from paying "fees" in Country Y.

C.

may receive an IRS tax credit for "fees" paid in Country Y.

D.

may pay the "fee" in Country Y but cannot take an IRS tax deduction.

The relationship between debt and equity in a company's capital structure is called:

A.

leverage.

B.

securitization.

C.

market capitalization.

D.

liquidity.

Which of the following ways of financing accounts receivable requires a company to relinquish control of the type of customer to which it sells?

A.

Securitization

B.

Using captive finance subsidiaries

C.

Third-party financing

D.

Unsecured borrowing