[Jan 25, 2022] Get New CTP Certification – Valid Exam Dumps Questions
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NEW QUESTION 421
On a statement of cash flow, which of the following items are considered sources of cash?
I) Increase in short-term investments
II) Net income
III) Increase in accounts payable
IV) Decrease in long-term debt
- A. II and IV only
- B. II and III only
- C. I and III only
- D. I, III, and IV only
Answer: B
NEW QUESTION 422
A globally diversified manufacturing company can manage its liquidity more effectively by:
- A. using repatriation strategies.
- B. reducing its international bank network.
- C. pooling cash of subsidiaries.
- D. centralizing bank accounts.
Answer: C
NEW QUESTION 423
Which of the following would MOST directly affect a company's dividend policy?
- A. Stock price
- B. Cost of capital
- C. The clientele effect
- D. A loan covenant
Answer: D
NEW QUESTION 424
Treasury policies and procedures should include responsibilities for:
- A. approving department salary increases.
- B. determining when dividends should be paid.
- C. key personnel in the treasury organization.
- D. evaluating alternative capital projects.
Answer: C
NEW QUESTION 425
If a company does not have cash available to make an interest payment on a bond, the company is experiencing difficulty with its:
- A. asset-liability management.
- B. profitability.
- C. liquidity management.
- D. capital structure.
Answer: C
NEW QUESTION 426
In terms of targeting a company's capital structure, when is it beneficial to assume a high level of financial risk?
- A. When the economy is experiencing slow growth
- B. When the economy is rapidly expanding
- C. When the company is experiencing growth
- D. When the rate of return on investments is advantageous
Answer: B
NEW QUESTION 427
The seller's cost of capital is 12%. The average credit sale is $200,000, and the credit terms are 2/10, net 30. What is the seller's net benefit (loss) if the buyer takes the discount and pays by day 10?
- A. $2,688.93
- B. ($2,688.93)
- C. ($3,986.89)
- D. $3,986.89
Answer: B
NEW QUESTION 428
Securities sold by companies in an initial public offering (IPO) arE.
- A. public securities sold by a private company for the first time.
- B. a specific type of security sold by a public company for the first time.
- C. debt securities sold on the open market.
- D. securities sold by a private company to a limited number of investors.
Answer: A
NEW QUESTION 429
A company sells products to customers on credit, generating accounts receivable. The company uses the accrual accounting method. Once the company collects good funds from its customers, what is the impact on the financial statements of the company?
- A. Cash balance is not affected, and income is increased.
- B. Cash balance is increased, and income is decreased.
- C. Cash balance is increased, and income is not affected.
- D. Cash balance is increased, and income is increased.
Answer: C
NEW QUESTION 430
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"?
- A. Six Sigma
- B. Re-engineering
- C. Outsourcing
- D. Benchmarking
Answer: D
NEW QUESTION 431
Which of the following investment instruments would provide a company with the greatest liquidity and least risk?
- A. Certificate of deposit
- B. Treasury bill
- C. Commercial paper
- D. Certificate of participation
Answer: B
NEW QUESTION 432
An increasing number of multinational companies have adopted formal multilateral netting systems for which of the following reasons?
- A. To standardize payment routes and banking channels
- B. To facilitate management of foreign exchange exposure
- C. To eliminate duplicate payments to vendors
- D. To improve check clearing times
Answer: B
NEW QUESTION 433
An accounts payable manager has been mandated to accept all trade discount opportunities with an effective cost of discount above 25%. An invoice has been presented and approved for payment with terms of 3/5, net 30 days. What is the difference between the effective cost of discount offered, and the 25% rate set by the company?
- A. 20%
- B. 14%
- C. 17%
- D. 22%
Answer: A
NEW QUESTION 434
When establishing a retail collection system that accepts consumer debit cards, a company must comply with which Federal Reserve regulation?
- A. Q
- B. D
- C. CC
- D. E
Answer: D
NEW QUESTION 435
A retail lockbox system is characterized by which of the following?
I. An emphasis on processing cost
II. Detailed information on discounts taken
III. Small-dollar amounts per invoice
IV.
Multiple invoices per payment
- A. I, II, and III only
- B. I and III only
- C. I and II only
- D. II, III, and IV only
Answer: B
NEW QUESTION 436
The risk that one financial institution's failure could lead to the failure of other financial institutions is known as:
- A. settlement risk.
- B. systemic risk.
- C. fraud risk.
- D. credit risk.
Answer: B
NEW QUESTION 437
Bank A is to pay Bank B $6,000,000 for 10 transactions that occurred throughout the day. Bank B is to pay Bank C $8,000,000 for 13 transactions that occurred throughout the day. Bank B is to pay Bank A $5,000,000 for 17 transactions that occurred throughout the same day. These banks operate using a gross settlement system. How many transactions will occur between these banks to settle the payments?
- A. 0
- B. 1
- C. 2
- D. 3
Answer: A
NEW QUESTION 438
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. IV, II, III, I
- B. IV, III, II, I
- C. III, IV, I, II
- D. I, III, IV, II
Answer: C
NEW QUESTION 439
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. Securitization
- C. Commercial paper issuance
- D. Asset-based credit line
Answer: D
NEW QUESTION 440
On the basis of the data above,
what is the forecast for Thursday's cash receipts, under the exponential smoothing method?
- A. $122
- B. $110
- C. $130
- D. $120
Answer: D
NEW QUESTION 441
U.S. dollar-denominated instruments issued by foreign banks through their domestic branches are known as:
- A. Eurodollar CDs.
- B. Eurocommercial paper.
- C. Yankee CDs.
- D. banker's acceptances.
Answer: A
NEW QUESTION 442
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. Transaction
- C. Economic
- D. Translation
Answer: D
NEW QUESTION 443
A publicly held U.S. company has reported at the beginning of the year that it expects to
increase shareholder value by 5%. The current expectations are for interest rates to remain steady with a decline in fourth quarter. Treasury policy requires that investments be 90 days or less and investment grade. How should the company invest excess cash to support this goal?
- A. 16-week U.S. Treasury bill
- B. BB rated bond
- C. Commercial paper
- D. High-yield bonds
Answer: C
NEW QUESTION 444
The measurement of the significance of any loss exposure depends on:
- A. loss probability and loss history.
- B. loss frequency and loss type.
- C. loss response and loss control.
- D. loss type and loss prevention.
Answer: B
NEW QUESTION 445
Bank A is to pay Bank B $6,000,000 for 10 transactions that occurred throughout the day. Bank B is to pay Bank C $8,000,000 for 13 transactions that occurred throughout the day. Bank B is to pay Bank A $5,000,000 for 17 transactions that occurred throughout the same day. These banks operate using a gross settlement system. How many transactions will
occur between these banks to settle the payments?
- A. 0
- B. 1
- C. 2
- D. 3
Answer: A
NEW QUESTION 446
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