Get 100% Authentic AFP CTP Dumps with Correct Answers [Q523-Q541]

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Get 100% Authentic AFP CTP Dumps with Correct Answers

New Training Course CTP Tutorial Preparation Guide

NEW QUESTION 523
A company’s overall cost of capital depends on the:

mix of long term debt and equity, and the cost of each.

weighted average cost of interest expense and dividends.

cost associated with debt and expected dividend returns.

WACC of the industry of which the company is part.

NEW QUESTION 524
Subtracting dividends from net income available to common shareholders is reflected as a change to which of the following balance sheet items?

Treasury stock

Paid-in capital

Common stock at par value

Retained earnings

NEW QUESTION 525
Capital budgeting is defined as the:

determination of the optimal level of debt versus equity.

process of evaluating alternative investment projects.

provision of sufficient borrowing facilities to meet transaction requirements.

addition of capital to the firm which results in a cash inflow.

NEW QUESTION 526
In cash forecasting, which of the following is a certain cash flow?

New product sales

Interest payments on long-term debt

Insurance claims pending settlement

Vendor check-clearing patterns

NEW QUESTION 527
Company XYZ is not sure which direction interest rates are headed. Which of the following would be MOST suitable?

An interest rate cap

An interest rate floor

An interest rate swap

An interest rate collar

NEW QUESTION 528
The before-tax cost of long-term debt is 10% and the cost of equity is 12%.

The marginal tax rate is 35%. The company’s weighted average cost of capital is:

6.3%.

8.3%.

10.6%.

11.3%.

NEW QUESTION 529
All of the following staff would be involved in the evaluation of an outsourced accounts payable solution EXCEPT:

an internal auditor.

a treasurer.

a controller.

a credit manager.

NEW QUESTION 530
Use the financial statement for XYZ Company in the exhibit to answer this question.

What is the cash flow from operating activities for the current year?

$(700,000)

$700,000

$900,000

$1,700,000

NEW QUESTION 531
The term “collection float” is defined as the delay between the time the payor:

prepares the check and the payee deposits the check.

mails the check and the payee deposits the check.

mails the check and the check is charged to the payor’s account.

mails the check and the payee receives the available funds.

NEW QUESTION 532
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?

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

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.

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.

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.

NEW QUESTION 533
All of the following are objectives of credit management EXCEPT:

evaluating customer creditworthiness.

preparing cash flow forecasts.

maintaining up-to-date records of accounts receivable.

initiating collection procedures.

NEW QUESTION 534
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?

$(4,470,000)

$(1,580,000)

$1,225,000

$8,500,000

NEW QUESTION 535
What activity should the Treasurer be most interested in if core treasury functions were to be compared within the industry or cross-industry for the purpose of identifying “best practices”?

Re-engineering

Outsourcing

Benchmarking

Six Sigma

NEW QUESTION 536
Which section of the statement of cash flows includes items that represent the cash inflows and outflows related to the daily functions of a company?

Cash flow from financing activities

Cash flow from investing activities

Change in cash balance

Cash flow from operating activities

NEW QUESTION 537
A multinational corporation (MNC) moving all of its Mexican peso-denominated revenues into a lower tax-rate jurisdiction could adopt any of the following treasury practices EXCEPT:

a shared service center.

an in-house bank.

licensing fees to subsidiaries.

a notional pooling program.

NEW QUESTION 538
The time between receipt of a mailed payment and the deposit of the payment in the payee’s account is known as:

collection float.

mail float.

processing float.

availability float.

NEW QUESTION 539
Which of the following is a service typically provided by an investment custodian?

Tax advice

Audit service

Portfolio reporting

Written policy

NEW QUESTION 540
A bank uses all of the following to determine whether a company’s balances are sufficient to compensate for services EXCEPT:

collected balances.

ledger balances.

earnings credit rates.

reserve requirement.

NEW QUESTION 541
A cash manager is determining the threshold over which cash concentrations will be done by wire. An ACH transaction costs $0.50. A wire costs $12.00. Funds are available 2 days quicker by wire and the opportunity cost of funds is 5%. What threshold should the cash
manager use?

$41,975

$43,800

$83,942

$87,600

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