200-300
NO.203 A nationwide retailer has been making EFT payments to its suppliers for several years. It will expand its processes to include consumer payments in its EFT initiative. Which of the following will support this initiative at the point-of-sale? A. Check truncation B. Consumer-to-business C. Paid-on-production D. Prearranged payment
A
NO.205 A company is looking to improve its collection rate of returned checks. If the company implements re-presented check entry (RCK) with its bank, it might see a reduction in what type of returned items? A. Consumer payments less than $2,500 B. Corporate payments less than $2,500 C. Consumer payments more than $2,500 D. Corporate payments more than $2,500
A
NO.225 Company XYZ has stable cash flows and sizable assets. The board of directors compared its WACC with its own industry's averages and determined that it may be at a competitive disadvantage. In order to become more competitive, what action will XYZ MOST LIKELY take? A. Issue new debt and repurchase common shares. B. Issue more common shares and retire debt. C. Reduce the dividend for a few quarters. D. Issue preferred shares with convertible warrants.
A
NO.240 A portfolio manager wishes to make a short-term investment. His investment policy requires that short-term investments be low risk and secured, have a fixed interest rate and be highly liquid/redeemable prior to maturity. Which of the following should the manager choose? A. Asset-backed commercial paper B. Bank obligations C. Commercial paper D. Government treasury bills
A
NO.245 The yield on any short-term investment instrument is a function of the maturity or holding period, the amount paid and: A. the cash flows received. B. the money market yield. C. the after-tax yield. D. the issuing price.
A
NO.247 Company ABC, with a current debt rating of BBB- from Standard & Poor's, is negotiating a new revolving credit agreement with its lenders. The company anticipates closing on a small acquisition within a year of executing this new agreement and would like maximum flexibility to determine its capital structure. The company is MOST concerned about the lenders' inclusion of A. A. ratings trigger. B. growth rate covenant. C. change in control covenant. D. limit on internal financing.
A
NO.248 Using a digital certificate when accessing a financial services provider is one way to reduce what kind of risk? A. Counterparty risk B. Process risk C. Reputational risk D. Compliance risk
A
NO.249 What is the reserve-requirements provision of the Federal Reserve Act of 1913 known as? A. Regulation D B. Regulation E C. Regulation J D. Regulation Q
A
NO.253 Which of the following would be considered insurance risk management services? A. Information-system consultants who upgrade loss controls B. External auditors who are hired to review financial statements C. IT professionals who ensure the treasury workstation properly converts FX D. Risk group that recommends the CFO approve SOX 404 compliance
A
NO.258 DGB Inc.'s CEO and founder retired shortly after the company went public two years ago. DGB Inc. has recently struggled, and the founder has agreed to return as an independent director. What violation, if any, has occurred? A. The cooling-off period has not been met. B. Section 404 of the Sarbanes-Oxley Act has been violated. C. ERISA disclosure requirements have not been met. D. No violation has occurred.
A
NO.261 What document serves as the basic account or service authorization, empowering a representative of a business to enter into agreements for financial services? A. Account resolution B. Credit agreement C. Service agreement D. Signature card
A
NO.267 A large retailer is preparing to accept credit cards and anticipates monthly credit card sales of $1,000,000. If the terms with the acquiring bank include bundled allocated fees of 6% and the retailer wishes to delay fee payment as long as possible, what should the retailer do? A. Accept gross settlement. B. Place a hold on consumer credit limits. C. Receive net settlement. D. Delay funds transfer to card-issuing banks.
A
NO.272 An analyst at XYZ Company was assigned with determining if the company should start to use a lockbox provider for its retail payments. The analyst determined that the company's annual sales of $324,000,000 were recorded evenly throughout the year. The Company receives 30,000 checks annually. Total dollar-days float without the lockbox is $76,500,000 and the annual opportunity cost is 5.5%; assume 30-day month. The industry's average opportunity cost is 6.0%. Using the information in the table,what would be the net effect of using the lockbox? A. Net savings of $57,750 B. Net savings of $63,000 C. Net savings of $1,732,500 D. Net savings of $1,890,000
A
NO.275 All of the following are examples of treasury management system transactions for liquidity management EXCEPT: A. FX transactions. B. loan draw-downs. C. investment sales. D. loan paydowns.
A
NO.277 JKL Company has been successful in shortening the time associated with its mail float, processing float and availability float. JKL Company will experience which of the following as a result of these improvements? A. Decrease in its opportunity cost B. Increase in its earnings rate C. Increase in its collection float D. Decrease in its NSF charges
A
NO.280 The treasury manager of an auto-parts manufacturer has noticed that checks were sent to a foreign individual not on the approved vendor list. The payables manager has explained the payments but did not provide an invoice. The treasury manager did no further research and is later disciplined for: A. not reporting suspicious activity under the USA Patriot Act. B. not purchasing enough surety insurance. C. ignoring International Accounting Standards Board regulations. D. not implementing "Check 21."
A
NO.282 Based on the above information, if the company uses the trade-off theory in considering its WACC, how will it finance its growth? A. By using long-term debt B. By issuing Class A stock C. By using retained earnings D. By issuing Class B stock
A
NO.284 EDI infrastructure includes which of the following four PRIMARY components? A. Communication networks and standards, computer hardware, EDI software, and standard formats B. Business-to-business banking services, EDI e-commerce, EDI software, and electronic payments networks C. Authentication devices, evaluated receipts settlement, firewalls, and single sourcing arrangements D. File transfer protocol, hypertext transfer protocol, uniform resource locator, and Extensible Markup Language (XML)
A
NO.288 A bank is evaluating the credit risk for a company seeking to optimize costs and originate a high volume of outgoing ACH payments. What is the BEST provision the bank should establish to control its credit exposure? A. An intraday credit limit for the company B. A limit on the number of items processed per day C. An overdraft facility for the company D. A standby letter of credit for the company
A
NO.290 When a company announces a significant and unexpected dividend increase, it signals to the market that management expects: A. earnings in future periods will be higher than in past periods. B. earnings in future periods will be lower than in past periods. C. earnings in future periods will not change. D. to split the stock in future periods.
A
NO.291 The board of directors announces an increase in its dividend from $0.11/share to $0.15/share. Over the next two quarters, management notices that its investor base has shifted to include a large percentage of pension funds and endowment funds. This is the result of: A. the clientele effect. B. the ex-dividend date. C. the dividend reinvestment plan. D. dividend capture.
A
NO.292 A small regional bank is losing market share in fiduciary services and the CEO has decided to scale back the trust department. Which of the following is considered a core service of a trust department? A. Paying agent for dividend and interest payments B. Monitoring compliance with audit procedures C. Providing consulting services in debt origination D. Processing drafts for collection.
A
NO.297 Treasury management systems and ERP systems allow companies to do all of the following EXCEPT: A. reduce cash processing costs. B. migrate external data into G/L infrastructure. C. increase productivity through seamless exchange of data. D. reduce redundant data entry errors.
A
NO.200 A publicly traded company is looking to fund its next project with the issuance of stock. The company's stock is primarily held by a small group of investors. The company is concerned that issuing stock may upset these investors because it would dilute their holdings. Which of the following strategies would help address the investors' concern? A. Grant the investors cumulative voting rights. B. Grant the investors pre-emptive rights to the new issue. C. Allow the investors to cast their votes by proxy at the next shareowners meeting. D. Offer to stagger the election of directors.
B
NO.206 When company profits are high, what is the MOST LIKELY way management will prefer to finance growth? A. By borrowing funds B. By retaining earnings C. By investing in current assets D. By issuing stock
B
NO.212 Which of the following is a characteristic of MOST mutual funds? A. Shares are primarily held by corporations and pension funds. B. The value of shares fluctuates with the performance of underlying securities. C. Funds are insured by the FDIC. D. Shares may be traded on the NYSE.
B
NO.214 Company ABC has a concentrated investor base consisting primarily of large institutional shareholders. It would like to increase its number of smaller shareholders using the most cost effective method of raising capital available. What should Company ABC do to accomplish this goal? A. Issue preferred stock. B. Implement a dividend reinvestment plan. C. Issue warrants. D. Implement a stock repurchase plan.
B
NO.215 On June 1, a manufacturing company experienced a system failure that lasted more than 24 hours. The company did not have any contingency plans in place and as a result the cash manager was unable to process the following payments: $25,000 to the p-card issuer, $125,000 for weekly payroll, $500,000 for a bond interest payment, $260,000 for the weekly vendor payments and $50,000 for the monthly utilities. The receivables were deposited at the bank; however, the cash manager does not have a way to confirm the amounts. The suppliers are threatening to stop shipments due to the delay in payment and the loss of supplier shipments threatens the company's just-in-time production. What did the manufacturing company trigger as a result of the system failure? A. Supplier risk B. Default on the debt C. Electronic security risk D. Contingency business resumption plan failure
B
NO.217 What is this firm's residual income? Revenues: $110,000 Expenses (including COGS and all taxes): $87,000 Internal rate of return: 8.5% Capital Investment: $55,000 ROI: 8.0% Cost of capital: 11% A. $16,500 B. $16,950 C. $18,325 D. $18,600
B
NO.218 Which statement is true about credit unions? A. They offer lending rates similar to other financial institutions. B. They are not-for-profit organizations. C. Their deposits are insured by the FDIC. D. They can only be chartered by state agencies.
B
NO.222 A nationwide discount retailer is re-evaluating financing methods since the most-popular and most-expensive electronics "must-have" item for this year is set to ship from factories in China. Which of the following credit facilities would be MOST effective for the retailer to use? A. Factoring B. Asset-based credit line C. Securitization D. Commercial paper issuance
B
NO.223 A small for-profit, start-up company is designing a retirement plan with the goal of minimizing costs and operating income volatility while providing a qualified retirement savings vehicle. Which of the following would be the BEST choice? A. Defined benefit plan B. Internal Revenue Code 401(k) plan C. Hybrid plan D. Internal Revenue Code 403 (b) plan
B
NO.224 A company has six fraudulent checks clear its primary disbursement account for a total of $7,652. The bank agrees to split the loss with the company to maintain a good relationship. As a condition of sharing the expense, the bank requires the company to establish positive pay on its disbursement accounts or have the company absorb the losses on future fraudulent payments. If the company determines that positive pay is too expensive and decides NOT to implement it, what type of risk financing technique is the company using? A. Crime insurance B. Self-insurance C. Risk avoidance D. Risk transfer
B
NO.227 An employee earning $80,000 per year decides to begin contributing to his company's 401(k) plan effective January 1st. Assuming he is in the 25% tax bracket, contributes 15% of his pay into the plan each month and receives a company match of $0.50 for every dollar he contributes, what is his taxable compensation that year? A. $51,000 B. $68,000 C. $74,000 D. $80,000
B
NO.228 One example of increased use of electronic payments for retail businesses to convert customer checks to cash at the counter more quickly is: A. BOC. B. POP. C. ARC. D. POD.
B
NO.230 Simplifying upgrades and system restoration, access from multiple remote locations, and interfacing with multiple applications are all reasons to: A. replace workstations annually. B. use the internet. C. use 128-bit encryption. D. outsource IT.
B
NO.231 EML Inc., which has $600 million in outstanding debt, is preparing to issue commercial paper in excess of $100 million within the next six months. The new assistant treasurer has recently spent time getting to know the issuing and paying agent, the rating agency analyst, and the legal counsel, and has been following the financial markets. What is this is an example of? A. Benchmarking with peers B. External collaboration C. Decentralized control D. Risk transfer
B
NO.232 JMW Company processes its consumer payments using a lockbox provider. On average 35% of its remittance advices contain encoding errors. JMW Company's cost for the lockbox provider to process these payments will be least impacted if it uses: A. wholesale lockbox. B. hybrid lockbox. C. direct lockbox. D. retail lockbox.
B
NO.233 Company XYZ had the following sales over the last 5 years: The company raised funds to invest in its operations. Considering the company's growth, it is interested in future options that will allow it to maintain its debt level and keep debt costs low. The company is not concerned about changes to the working capital structure. Which security did the company issue? A. Unsecured bond B. Bond with an equity kicker C. Zero-coupon bond D. Convertible security
B
NO.234 The yield curve is inverted. A creditworthy firm considering alternative debt maturities would MOST LIKELY: A. enter into a short-term floating rate agreement. B. obtain long-term fixed interest rate debt. C. roll-over short-term debt at each maturity. D. obtain a long-term floating rate agreement.
B
NO.241 A portfolio manager's investment policy states that they are not allowed to hold any investments that have extension risk. Which type of investment should the portfolio manager avoid? A. REMICs B. Ginnie Mae MBSes C. Municipal bonds D. Treasury notes
B
NO.242 Which of the following types of risk would an investor who does NOT receive payments on a security under the original terms be subject to? A. Price B. Credit C. Asset liquidity D. Foreign exchange
B
NO.244 A company is experiencing the following long-term trend on a month-over-month basis: With all other income, expenses, long-term assets and liabilities remaining stable, this trend would MOST LIKELY prompt what action by the company? A. Financing working capital requirements B. Repaying short-term debt C. Reducing labor costs D. Factoring accounts receivable
B
NO.251 Which of the following is a tool that companies use to obtain a quantitative rating of a financial institution's level of service? A. Relationship review B. Score card C. Service agreement D. CAMELS rating
B
NO.252 An analyst is performing a lease versus buy analysis on a corporate jet. In the evaluation, a cost is relevant if it is: A. tied to inflation. B. different in each scenario. C. considered a sunk cost. D. unlikely to be incurred.
B
NO.254 Usually, corporations receiving dividends from another corporation can exclude 70 percent of dividend payments from income for tax purposes as long as the stock is owned for at least: A. 30 days. B. 45 days. C. 60 days. D. 90 days.
B
NO.257 Recently LEW Utilities, a local utility company, began using the company processing center method to process customer payments. Prior to this change, it used its local depository bank's lockbox to process the payments. The PRIMARY advantage of the new method is to: A. decrease mail float as a result of applying payments in-house. B. ensure that payments are correctly applied to the customer's account. C. reduce the processing float since payments are mailed directly to the customer. D. lower overall costs since in-house processing is cheaper than third-party processing.
B
NO.260 Amalgamated Binding Consolidators takes 20 days to convert its raw materials to finished goods, 5 days to sell it, and 15 days to collect its credit sales. What is the company's days receivable period? A. 5 days B. 15 days C. 20 days D. 40 days
B
NO.264 XYZ Inc. has limited cash flow, total liabilities to total assets greater than 52%, and a high WACC. To help meet the goal of lowering their WACC, the company plans to issue several million dollars of private equity to the chairman of the board. If the company proceeds with this plan, the company may: A. not comply with SOX requirements. B. violate shareholder pre-emptive rights. C. require approval from PCAOB. D. need to report the large currency transaction.
B
NO.268 A company which experiences increased business volumes but a minimal increase in profitability MOST LIKELY has: A. very high level of operating leverage. B. low fixed costs and high variable costs. C. high fixed costs and low variable cost. D. high effective cost of debt.
B
NO.269 For ABC Company in the last fiscal year, the operating profit was $8,500,000, the tax rate was 33%, the total capital was $75,000,000, and the WACC was 9.7%. What was the EVA for ABC? A. $(4,470,000) B. $(1,580,000) C. $1,225,000 D. $8,500,000
B
NO.270 Money market funds are able to obtain very competitive trading terms because: A. there is no diversification. B. of the economies of scale. C. invested funds are locked in for a specific period of time. D. the investment manager only purchases high yielding instruments.
B
NO.274 A company in the market to purchase a treasury management system (TMS) has issued a request for proposal to evaluate various vendors. One of the evaluation factors focuses on the longterm viability of the vendor. The company may have to choose between an untested new vendor with a superior product and an established vendor with an incomplete product suite. This dimension of the RFP is measuring what type of risk? A. Reputational risk B. Supplier risk C. Technology risk D. Financial risk
B
NO.281 What do MOST companies try to maintain due to the signaling effect and clientele effect? A. A stable policy of retained earnings B. A stable dividend policy C. A consistent payment date D. A dividend reinvestment plan
B
NO.285 XYZ Inc. is a publicly traded company with revenues of $1B and an operating profit of 7.5%. The treasury organization consists of a treasurer and an assistant treasurer. The assistant treasurer is responsible for the creation and approval of all payments. The treasurer is responsible for compilation of the financial statements. Under Section 404 of the Sarbanes-Oxley Act, what should be viewed as a concern? A. Audit committee governance B. Segregation of duties C. Subcertification D. Signature on SEC Form 10-K
B
NO.286 Which of the following is a true statement about operating leverage? A. The higher the company's fixed costs are, the lower its operating leverage. B. The higher the company's fixed costs are, the higher its operating leverage. C. The lower the company's fixed costs are, the higher its operating leverage. D. The higher the company's variable costs are, the higher its operating leverage.
B
NO.287 BEA Company has determined its breakeven dollar amount for concentrating remote funds is $550.00. BEA Company has a daily earnings rate of 6% and gains one day of accelerated funds. If a wire costs BEA $35.00 dollars, what is the cost of an electronic funds transfer for BEA Company? A. $1.00 B. $2.00 C. $3.00 D. $4.00
B
NO.289 Which of the following options would be BEST suited for a firm that wishes to pay no premium? A. Cap B. Collar C. Floor D. Swaption
B
NO.294 A U.S. company has a secured committed line of credit of $5 million. The company successfully transmitted a $5.5 million wire transfer instruction out to the bank. The bank contacted the company and informed it that the wire transfer would not be processed. What is the MOST LIKELY reason the bank gave the company? A. The company overdraft facility was sufficient. B. The bank imposed a guidance line of credit on the account. C. The company reached its maximum limit on the committed line. D. The bank refused funding on the company's discretionary line of credit.
B
NO.296 A treasury manager at a multinational manufacturing corporation assigned a team of analysts to re-engineer the company's FX exposure management program. Which of the following alternatives would BEST accomplish this objective? A. Leading and lagging B. Re-invoicing C. Transfer pricing D. Value dating
B
NO.201 An institutional investor has purchased an investment that provides a fixed rate of return with some potential for delays in payments. The return is 70% tax deductible for this particular investor. What type of investment was MOST LIKELY purchased? A. Common stock B. Sinking fund debenture C. Preferred stock D. Bonds with warrants
C
NO.204 A-Plus Company has made arrangements for a new insurance broker to provide products to its employees. Historically, A-Plus Company's employees made insurance payments via payroll deduction, but the new broker will be collecting payments from employees directly. What will the broker MOST LIKELY use to minimize collection float? A. ARC B. CCD C. PPD D. RCK
C
NO.208 What is the premium (price) for an oil contract, if the following conditions are present? LIBOR rate of 5% Out of the money cost of $3 Strike price is $4 In the money price of $1 Speculative premium of $2 A. $3 B. $5.25 C. $7 D. $7.35
C
NO.210 A company with high operating leverage reduces its average cost per unit by 20% as its sales volume increases by 40% annually. This an example oF. A. low fixed costs. B. low variable costs. C. economies of scale. D. equal distribution of fixed and variable costs per item.
C
NO.213 Which of the following is generally NOT a benefit of financial risk management? A. The likelihood of financial distress decreases B. Greater predictability of future cash flows C. The opportunity to take advantage of market inefficiencies D. Enhanced borrowing advantage in credit markets
C
NO.219 Which of the following would be true for a company with high operating leverage? A. Its cost of goods sold does not increase as revenues increase. B. It has high variable costs per unit sold. C. If revenues increase marginally, it can achieve a large percentage increase in profits. D. Its semi-variable costs do not have a fixed cost component.
C
NO.226 Company XYZ is conservative when investing in their short-term portfolio. XYZ is looking to add the following money market instruments in their own country: a reverse re-purchase agreement, a floating-rate note, and a negotiable certificate of deposit. What types of investment risks are associated with these instruments? A. Credit and price risk B. Liquidity and price risk C. Default and liquidity risk D. Default, liquidity and price risk
C
NO.235 Loss exposures related to treasury management may include which of the following? A. Excessive product recalls B. PBGC violations C. Deterioration of investment principal D. Bank consolidations
C
NO.236 Which of the following is a purpose of the Check 21 Act? A. Grant legal status for digital signatures B. Foster innovation in the ACH payment system C. Facilitate check truncation D. Improve check imaging and archiving
C
NO.237 ABC Ltd. uses a third party lockbox provider to collect and clear its paper receivables. A customer disputes the price charged for a binding machine and issues a check to ABC Ltd. for 50% of the balance due, noting "paid in full" on the face of the check. The third party provider does not bring the check to ABC's attention prior to depositing it. Which regulation allows ABC to attempt to collect the remaining balance? A. UCC Article 2 - Clearing of Checks B. Federal Reserve Regulation CC C. UCC Article 3 - Negotiable Instruments D. UCC Article 4 - Bank Deposits and Collections
C
NO.255 Company ABC needs external capital to finance a new product line. Its operating leverage is high, and its revolving credit agreement contains a ratings trigger. What will Company ABC MOST LIKELY do to finance its new product line? A. Issue convertible debentures. B. Issue long-term notes. C. Issue common stock. D. Use retained earnings.
C
NO.259 After several internal discussions about treasury management systems (TMSes), ABC Company has determined that it has no need for customization but that it does want a backup for high priority capabilities. The company wants to reduce its IT costs and resources but still have IT support with in-depth knowledge of the solutions available. These parameters will MOST LIKELY result in what kind of TMS? A. An ERP module TMS B. An integrated TMS C. A hosted ASP TMS D. Development of its own TMS
C
NO.262 A corporate compliance officer is drafting an agenda for an ethics training session. Which of the following would NOT be an appropriate item to include? A. Discussion of recent cases involving unethical behavior B. Presentation of hypothetical situations and how to resolve them C. Review and analysis of the costs associated with ethics compliance D. Monitoring of a hotline to report governance violations
C
NO.263 Securities sold by companies in an initial public offering (IPO) arE. A. a specific type of security sold by a public company for the first time. B. debt securities sold on the open market. C. public securities sold by a private company for the first time. D. securities sold by a private company to a limited number of investors.
C
NO.265 An asset-based lender has decided to provide a loan to a company. In order to perfect its security interest in the assets used as collateral with the potential borrower, the lender will be MOST interested in reviewing which of the following? A. Book value of inventory B. Delinquency payment record C. Lien search findings D. Age of receivables
C
NO.271 A company is filing for bankruptcy protection and is concerned about the welfare of its sizeable retiree population. Under ERISA, it is obligated to perform which of the following actions regarding its defined benefit plan? A. Use proceeds from asset sales to fund the plan liability. B. Convert the plan to a portable, hybrid vehicle. C. Record a distress termination with the PBGC. D. File a 5500 report (bankruptcy amendment) with the DOL.
C
NO.273 A retail brokerage firm is MOST like which one of the following types of financial institutions? A. Captive finance companies B. Factoring companies C. Investment banks D. Insurance companies
C
NO.278 A manager has prepared an analysis of five investment alternatives. Prior to selecting which alternative to invest funds in, the manager calculated the anticipated return for all options. The manager is only going to invest in one alternative. The four investments that are not chosen are: A. a cost of capital. B. a loss of leverage. C. an opportunity cost. D. a cost benefit.
C
NO.283 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
NO.295 Company XYZ has an underfunded defined benefit plan. Company XYZ is required to provide filings for this plan to all of the following EXCEPT: A. the Department of Labor. B. the Pension Benefit Guaranty Corporation. C. the Securities and Exchange Commission. D. plan participants.
C
NO.298 Two months after a government overthrow, the new Minister of Industry and Culture took over the country's largest steel company and compensated the owners at 50% of book value. What is the government's action called? A. Consolidation B. Deregulation C. Expropriation D. Nationalization
C
NO.299 Kensley Biscuit Company Ltd. decides to invest GBP125,000 in new packaging equipment to help it keep up with increased demand. As a result of this investment, the company's annual profit improves by GBP11,763. If Kensley's cost of capital is 8.25% and its corporate tax rate is 42%, what is its residual income (RI) from the investment? A. GBP842 B. GBP970 C. GBP1,451 D. GBP11,763
C
NO.202 Company ABC has undergone substantial system enhancements in order to take advantage of B2B efficiencies. To encourage its trading partners, ABC has offered a 1.5% discount to those who allow ABC to debit their bank account electronically on the day the product is delivered. The greater number of trading partners who agree to this arrangement, the greater improvement Company ABC will see in its: A. days' inventory. B. cash flow to total debt. C. days' payables. D. cash turnover ratio.
D
NO.207 Which of the following is true of return on investment (ROI)? A. It includes a charge for the cost of capital in a project. B. It is commonly used to calculate after-tax profitability. C. It may cause management to accept a project with positive NPV. D. It is calculated as profit per dollar of invested capital.
D
NO.209 Equity section of Fisher, Inc. Financial Statement If an investor paid $1,400.00 (excluding fees) for 75 shares of common stock, what was the market value of Fisher, Inc. at the time of purchase? A. 15.50 B. 15.76 C. 16.97 D. 18.67
D
NO.211 Given the above information, if the risk manager adds a tank at its second facility, what loss control technique is being used? A. Exposure avoidance B. Limiting contractual acceptance of risk C. Catastrophic loss control D. Separation of exposures
D
NO.216 Which of the following is sought from a typical cash management services Request for Proposals (RFP)? A. CAMELS score B. Asset investment strategy C. Pension funding status D. Implementation team
D
NO.220 Sign Company and Paint Company have a twenty-year business relationship, and they work together when sending and receiving payments. Sign Company also does a large amount of business with Brush Company, a subsidiary of Paint Company. Brush Company's Treasurer recently received a memo from the Treasurer of Paint Company reminding it that when dealing with vendors, extensive information is required when receiving or making ACH payments. What ACH payment format are Sign Company and Paint Company MOST LIKELY to use? A. CCD B. EBPP C. CCD+ D. CTX
D
NO.221 A dealer is selling securities to a client. What is the yield/price at which the dealer will sell? A. Bid price B. After-tax price C. Market price D. Ask price
D
NO.229 Company XYZ is in its first year of operations. The company culture is conservative, and it has $500 million to invest in short-term investments. The company has a growth rate of 25% and is looking to issue an IPO in the near future. The investment manager is in the process of creating a short-term investment policy which must be approved by the board of directors. An item that should be included in the policy is: A. methods of monitoring compliance with the SEC. B. maximum dollar amount of mortgage-backed securities. C. internal controls for the enterprise resource planning system (ERP). D. methods of monitoring compliance with policies, procedures and internal controls.
D
NO.238 A company with $50 million in foreign assets decides to increase its foreign debt by $40 million for a debt ratio of 80%. This action will reduce which exposure? A. Hedged B. Economic C. Transaction D. Translation
D
NO.239 Which of the following is NOT true for both bankers' acceptances and trade acceptances? A. They are both used to finance the shipment of goods. B. They both may be sold to an investor at a discount prior to maturity. C. They are both less expensive forms of financing than loans. D. They both transfer the buyer's credit risk to a third party.
D
NO.243 The controller is developing a financial plan that includes an operating budget and a financial budget. Which of the following statements is true? A. The financial budget is used to determine the operating activity level the company can support. B. The two budgets do not have any impact on each other. C. The operating budget is developed to determine the staffing level needed for operations. D. The financial budget is impacted by the company's sources and uses of cash.
D
NO.246 A company has six fraudulent checks clear its primary disbursement account for a total of $7,652. The bank agrees to split the loss with the company to maintain a good relationship. As a condition of sharing the expense, the bank requires the company to establish positive pay on its disbursement accounts or have the company absorb the losses on future fraudulent payments. What type of risk financing technique is the bank using? A. Crime insurance B. Self-insurance C. Risk retention D. Risk transfer
D
NO.250 A company is evaluating its employee healthcare expense and payroll applications. If the company wishes to provide maximum convenience to its employees, which payment method is the BEST choice? A. Purchasing cards B. Checks C. Travel cards D. Stored value cards
D
NO.256 ABC Corporation receives images of paid check exception items from its bank and reviews them daily. What action should be taken on an item where the payee on the image does NOT match the data from ABC Corporation's accounts payable? A. Bank alerts payee that check is unmatched. B. ABC Company utilizes the holder in due course defense. C. Image remains stored on ABC Corporation's network for future customer inquiries. D. No-pay decision is communicated to the bank.
D
NO.266 An art history museum has recently finished renovating its new location. Before the move, the treasurer considers purchasing additional insurance to protect the art during transit. What form of additional insurance should the treasurer choose? A. Special multi-peril (SMP) B. Business interruption C. General liability D. Difference in conditions (DIC)
D
NO.276 A company has decided to manage its short-term investment portfolio in-house. It is looking for enhanced capital gains as well as the ability to sell the instruments on the secondary market at a premium. The investment manager has forecasted the interest rates shown below: Which investment strategy should be employed by the company? A. Passive strategy B. Matching strategy C. Tax-based strategy D. Total-return strategy
D
NO.279 ABC Company, a leading provider of office supplies, has successfully implemented EDI based on a request from one of its customers. ABC will not only benefit from the strategic alliance that will result, but as more of ABC's customers adopt the program, ABC will also experience a positive impact on its: A. EFT costs. B. C2C levels. C. value added networks. D. inventory levels.
D
NO.293 Private companies usually go public by making an initial public offering. What is the term for offering subsequent shares in the market? A. Common B. Underwritten C. Regulated D. Seasoned
D
