MB-920 Practice Test 2 — 30 Questions

Question 1

A company uses Dynamics 365 Finance for financial management. The CFO wants to use AI to predict customer payment delays and recommend proactive actions. Which feature should you use?

Accepted Answer

Customer payment predictions. Customer payment predictions in Dynamics 365 Finance uses AI to forecast when customers will pay invoices and provides recommendations for proactive actions, such as prioritizing collections. This directly matches the CFO's requirement to predict payment delays and suggest actions.

Answer

Cash flow forecasting

Answer

Microsoft Copilot in Finance

Answer

Budgeting and planning

Question 2

A retail company uses Dynamics 365 Commerce. They need to offer a discount on a specific product line for a limited time. Which pricing mechanism should they configure?

Accepted Answer

Trade agreements. Trade agreements in Dynamics 365 Commerce are the correct pricing mechanism for offering a limited-time discount on a specific product line. They allow you to define price reductions for a specific product or product category for a defined date range, directly controlling the discount amount and validity period. This is the standard way to create time-bound promotional pricing without altering base prices or requiring complex price group assignments.

Answer

Sales tax

Answer

Product categories

Answer

Price groups

Question 3

Which TWO are benefits of using Dynamics 365 Supply Chain Management with IoT integration?

Accepted Answer

Real-time asset tracking. Option C (Real-time asset tracking) is correct because IoT integration in Dynamics 365 Supply Chain Management streams telemetry from connected devices and sensors into the system, allowing inventory, containers, and other assets to be monitored and located continuously as they move through the supply chain. Option E (Predictive maintenance on equipment) is correct because IoT sensor data (vibration, temperature, usage hours) feeds into Dynamics 365 Supply Chain Management's asset management capabilities, enabling condition-based alerts and maintenance scheduling before equipment fails. The remaining options do not belong: A (Real-time customer credit check) is a finance/credit management function unrelated to IoT device data, B (Vendor negotiation) is a procurement relationship activity performed by people rather than an IoT-driven benefit, and D (Automated financial closing) is a financial period-end process that does not depend on IoT telemetry.

Answer

Real-time customer credit check

Answer

Vendor negotiation

Answer

Automated financial closing

Question 4

A manufacturing company uses Dynamics 365 Finance and Operations. They want to automatically post a purchase order once it is approved by a manager. What feature should they configure?

Accepted Answer

Workflow. Workflow in Dynamics 365 Finance and Operations is the correct feature because it allows you to define a business process that automatically triggers an action—such as posting a purchase order—once a specific condition (e.g., manager approval) is met. Workflows can be configured to run without manual intervention, enabling the automatic posting of the purchase order immediately after the approval step completes.

Answer

Electronic reporting

Answer

Batch job

Answer

Budget control

Question 5

A project manager needs to approve time entries submitted by team members. Where in Dynamics 365 Project Operations can the manager approve these time entries?

Accepted Answer

Project Manager Time Approval workspace. The Project Manager Time Approval workspace in Dynamics 365 Project Operations is the dedicated area where project managers can review, approve, or reject time entries submitted by team members. This workspace provides a filtered view of pending time entries and integrates with the project's approval workflow, ensuring that only authorized managers can process time submissions.

Answer

Resource Manager dashboard

Answer

Sales entity

Answer

Project Contract

Question 6

A company uses Dynamics 365 Project Operations to manage project expenses. An employee submits an expense report for a project. The project manager needs to approve the expense report. Where does the project manager perform this approval?

Accepted Answer

Expense Approval workspace. In Dynamics 365 Project Operations, expense report approvals are handled through the Expense Approval workspace. This workspace is specifically designed for project managers and approvers to review, approve, or reject expense reports submitted by project team members. It provides a centralized view of all pending expense approvals tied to projects.

Answer

Project Contract

Answer

Resource Manager dashboard

Answer

Time Approval workspace

Question 7

Which THREE of the following are valid warehouse management processes in Dynamics 365 Supply Chain Management?

Accepted Answer

Shipping. In Dynamics 365 Supply Chain Management, the core warehouse management processes are inbound receiving, outbound shipping, and internal picking, so options A (Shipping), C (Picking), and D (Receiving) are correct. Receiving handles inbound registration and put-away of arriving goods, picking handles the retrieval of items from storage locations to fulfill demand, and shipping handles the final outbound staging, packing, and loading of goods to customers. Budgeting (B) is a financial planning function in Finance, not a warehouse execution process, and invoicing (E) is an accounts receivable/finance activity rather than a warehouse operation.

Answer

Budgeting

Answer

Invoicing

Question 8

A company is implementing Dynamics 365 Finance and needs to automate the reconciliation of bank transactions. Which feature should be used to match bank statement lines with open bank document lines based on rules?

Accepted Answer

Advanced bank reconciliation. Advanced bank reconciliation in Dynamics 365 Finance allows you to import bank statement lines and automatically match them to open bank document lines (such as checks, deposits, and transfers) using user-defined matching rules. This feature supports rule-based matching (e.g., by amount, date, or reference) and handles complex scenarios like partial matches or tolerance thresholds, making it the correct choice for automating bank transaction reconciliation.

Answer

Bank account reconciliation

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Payment proposal

Answer

Automatic settlement

Question 9

A company uses Dynamics 365 Finance. The finance team needs to ensure that purchase invoices are automatically matched to purchase orders and product receipts before payment is processed. Which feature should be configured?

Accepted Answer

Accounts payable invoice matching. Accounts payable invoice matching (option D) is the correct feature because it automatically compares purchase invoice details (quantities, prices, charges) against the corresponding purchase order and product receipt. This three-way matching ensures that payment is only processed when the invoice matches the order and receipt, preventing overpayment and discrepancies.

Answer

Fixed asset management

Answer

Workflow approval

Answer

Vendor collaboration portal

Question 10

Which THREE of the following are components of the Dynamics 365 Commerce architecture?

Accepted Answer

Retail Server. Retail Server (A) is a core component of the Dynamics 365 Commerce architecture, acting as the middle-tier service that exposes commerce APIs to point of sale (POS), e-commerce, and other clients. Commerce Data Exchange (B) is also a core component, providing the asynchronous data synchronization framework (via CDX jobs such as Download and Upload) between the headquarters (HQ) and channel databases. Channel database (E) is likewise a core architectural component, as each retail channel (e.g., store or online store) has its own channel database that stores channel-specific data and syncs with HQ through CDX. Azure Data Lake (C) and Power BI (D) are not components of the Commerce architecture itself; they are separate Azure/Microsoft analytics and reporting services that may integrate with Dynamics 365 Commerce but are not part of its core architecture.

Answer

Azure Data Lake

Answer

Power BI

Question 11

A company uses Dynamics 365 Project Operations. They need to track project costs and revenue. Which THREE components are essential?

Accepted Answer

Time and expense entry. Time and expense entry (B) is essential because Project Operations captures actual labor and non-labor costs through timesheets and expense reports, which feed the project's cost and revenue actuals. Revenue recognition (C) is essential because Project Operations must recognize revenue for projects, supporting both time-and-materials and fixed-price billing methods to correctly reflect earned revenue. Project cost tracking (D) is essential because the core requirement is to monitor project costs against budgets, including actuals from time, expenses, and materials, enabling profitability analysis. Resource management (A) is not among the marked correct answers, and while useful for staffing, it is not strictly essential to tracking costs and revenue. Fixed asset management (E) is unrelated to project cost and revenue tracking, as it concerns depreciating capital assets rather than project financials.

Answer

Resource management

Answer

Fixed asset management

Question 12

A manufacturing company uses Dynamics 365 Finance and Operations. They want to automate the generation of purchase orders based on inventory levels falling below a reorder point. Which feature should they configure?

Accepted Answer

Safety stock and reorder point planning. The 'Safety stock and reorder point planning' feature in Dynamics 365 Finance and Operations uses item coverage settings to automatically generate planned purchase orders when projected inventory falls below the defined reorder point. This is part of master planning, which calculates replenishment proposals based on inventory levels, lead times, and demand forecasts.

Answer

Inventory closing and adjustment

Answer

Inventory cycle counting

Answer

Purchase requisition workflow

Question 13

A company uses Dynamics 365 Finance and Operations. They need to ensure that all purchase orders over $10,000 require approval from a manager. What feature should they configure?

Accepted Answer

Workflows. Workflows in Dynamics 365 Finance and Operations allow you to define automated business processes that route documents, such as purchase orders, for approval based on conditions like amount thresholds. By configuring a purchase order workflow with a condition that triggers approval when the total exceeds $10,000, you ensure manager approval is required for high-value orders.

Answer

Budget control

Answer

Audit policies

Answer

Policy rules

Question 14

A multinational corporation using Dynamics 365 Finance needs to revalue foreign currency bank accounts at month-end. The finance manager wants to automate this process and ensure that exchange rate differences are posted to the correct accounts. What is the best approach?

Accepted Answer

Use the Foreign currency revaluation feature in General ledger.. The Foreign currency revaluation feature in Dynamics 365 Finance is specifically designed to revalue foreign currency bank accounts and ledger accounts at period-end, automatically calculating exchange rate differences and posting them to designated gain/loss accounts. It supports automation through batch jobs and ensures compliance with accounting standards by using configured exchange rate types. This is the standard, auditable approach for month-end revaluation.

Answer

Create manual journal entries for each bank account using the month-end exchange rate.

Answer

Use the General journal to post exchange rate adjustments.

Answer

Configure exchange rate types for each currency pair.

Question 15

A company uses Dynamics 365 Supply Chain Management. They want to enable a vendor to manage their own inventory at the customer's site (consignment inventory). What process should they set up?

Accepted Answer

Consignment inventory. Consignment inventory in Dynamics 365 Supply Chain Management allows a vendor to own stock that is physically located at the customer's site. The customer only pays for the inventory when it is consumed or transferred to their ownership. Setting up the consignment inventory process enables the vendor to manage replenishment and visibility of their stock at the customer location through vendor collaboration features.

Answer

Vendor collaboration

Answer

Purchase order with drop shipment

Answer

Transfer order

Question 16

Refer to the exhibit. A Dynamics 365 Finance and Operations administrator reviews a batch job configuration. The job is scheduled to run daily. What is the purpose of this batch job?

Accepted Answer

Post recurring invoices automatically. The batch job configuration shown is for the 'Recurring invoices' process in Dynamics 365 Finance and Operations. When a batch job is set to run daily with the action 'Post,' its purpose is to automatically post recurring invoices that have been previously set up in the recurring invoice template. This automates the posting step, eliminating the need for manual intervention each period.

Answer

Generate recurring invoices

Answer

Send invoice payment reminders

Answer

Print recurring invoices

Question 17

Which TWO of the following are valid project types in Dynamics 365 Project Operations? (Choose two.)

Accepted Answer

Time and Material. In Dynamics 365 Project Operations, the two valid project types are Time and Material (option B) and Fixed Price (option D). Time and Material projects bill the customer based on actual time and materials consumed, using chargeable and non-chargeable transaction types, and are the default project type when creating a project. Fixed Price projects bill the customer a predetermined contract amount regardless of actual costs, and they use billing milestones or fixed-price invoice schedules to recognize revenue. Options A (External), C (Internal), and E (Investment) are not project types in Project Operations; while internal or investment projects may be modeled using non-billable Time and Material projects, they are not distinct project type values in the system.

Answer

External

Answer

Internal

Answer

Investment

Question 18

A company uses Dynamics 365 Supply Chain Management with process manufacturing. They need to manage byproducts and co-products in a production order. Which functionality should they use?

Accepted Answer

Formula with co-products and by-products. In process manufacturing, co-products and by-products are managed using a formula, not a bill of materials (BOM). The formula defines the production recipe, including the main output, co-products (intended secondary outputs), and by-products (unavoidable secondary outputs). This allows the system to automatically credit or cost these outputs during production order processing.

Answer

Bill of materials (BOM)

Answer

Location directives

Answer

Transfer orders

Question 19

A company is implementing Dynamics 365 Finance and needs to manage vendor payments efficiently. Which TWO features should be used to automate payment processing and reduce manual effort?

Accepted Answer

Electronic payment formats. Electronic payment formats (A) are correct because they let Dynamics 365 Finance generate payment files in the bank-specific layouts required for electronic funds transfer, eliminating the manual creation of payment files and enabling automated transmission to the bank. Payment proposals (D) are correct because they let you generate suggested vendor payments based on criteria such as due date, cash discount, and vendor group, which automates the selection of invoices to pay and reduces manual effort in deciding what to pay. Vendor invoice pool (B) is a holding area for pending vendor invoices awaiting approval or matching, not a payment automation feature. Vendor hold (C) is used to block a vendor from being included in transactions or payments, which restricts rather than automates processing. Payment calendar (E) defines valid payment dates and due date calculations, but it does not itself automate payment generation or file creation.

Answer

Vendor invoice pool

Answer

Vendor hold

Answer

Payment calendar

Question 20

A company uses Dynamics 365 Finance. They need to generate financial statements that comply with international accounting standards. Which configuration should they use?

Accepted Answer

Financial reporting. Financial reporting in Dynamics 365 Finance is the dedicated configuration for creating, managing, and generating financial statements that comply with international accounting standards such as IFRS. It uses the Financial Reporting module (formerly Management Reporter) to produce balance sheets, income statements, and other reports with multi-currency and multi-entity consolidation support, ensuring compliance with regulatory requirements.

Answer

Budgeting

Answer

General ledger

Answer

Tax engine