Pass the AFP Certification CTP Questions and answers with ExamsMirror

A company offers credit terms of net 40, with an opportunity cost of 12% to a customer. What discount would have to be offered for the customer to be indifferent between paying on Day 40 and paying with the discount on Day 10?

A company has average monthly sales of $2,700, of which 5 percent is on a cash basis, with the remaining sold on open account. The company's accounts receivable aging schedule at the end of March is as follows:

What is the company's DSO?

Which agency appoints the chairman and members of the Public Company Accounting Oversight Board?

Refer to the following information about a company at the end of its fiscal year.

The before-tax cost of long-term debt is 10% and the cost of equity is 12%. The marginal tax rate is 35%.

What is the company's long-term debt to total capitalization ratio?

An accounts receivable manager has been asked to accelerate cash into her company by offering trade discount terms to its customers. Her company's cost of capital is 11%. If she offers terms of 2/10, net 30 on a $50,000 invoice, what is the present value to the company if the customer accepts the discount and pays early?

Which two of the following are optimal uses for short-term excess cash?

I. Pay down credit lines.

II. Make overnight investments.

III. Repurchase stock.

IV. Make capital expenditures.

According to the Capital Asset Pricing Model, which of the following would increase the required rate of return, given a beta of 1?

Which of the following statements are true about the use of different discount rates for different types of projects?

I. Low-risk, short-term projects may be evaluated by using a short-term opportunity cost.

II. High-risk projects may be evaluated by using a discount rate that is greater than the company's normal opportunity cost.

III. A short-term investment (or borrowing) rate may be used as the company's short-term discount rate.

IV. The use of a lower discount rate for riskier projects forces riskier projects to earn higher rates of return.

The owner of XYZ Company just completed an initial public offering. Which of the following is the MOST LIKELY outcome?

Merchant XYZ has $200,000 in sales for the month of December, 60% in cash and the remaining is divided equally between checks and credit cards. One percent of the credit cards were charged back during the month of January. What is the value of sales received by the merchant?

A manufacturing company begins using just-in-time (JIT) inventory management. Which JIT-related payment process is MOST LIKELY to be implemented?

A Treasury Management System (TMS) is used to:

ABC Industries, a Canadian company, is in the process of acquiring a company in Europe for EUR100 million. The company has entered into a forward contract to lock in the purchase price and sell CAD and buy EUR on May 30th. Due to legalities, management now expects to finalize the acquisition on July 30th. The treasury manager of the company is MOST LIKELY to recommend which of the following to unwind the forward contract on May 30th?

Which of the following are differences between securities issued through the primary and private capital markets?

I. Cost of issuance and speed of execution

II. Investor base

III. Reasons for the offering

IV. Registration requirements

An investor purchases securities that mature beyond the date when cash is required. The investor intends to sell the investment to meet the cash flow need. This strategy works best when:

Which of the following is true about using an RFI in the financial institution and FSP selection process?

Subtracting dividends from net income available to common shareholders is reflected as a change to which of the following balance sheet items?

Without regard to costs, which of the following concentration mechanisms maximizes investment income in a multi-bank environment?

An employee was targeted with a phishing scam, which was deleted and reported to the company's IT department. This shows the company's end-user computing policy includes which of the following?

A company's basic investment objectives should include all of the following EXCEPT: