MB-920 Practice Test 42 — 15 Questions

Question 1

Refer to the exhibit. A Dynamics 365 Finance analyst runs the KQL query shown against the FinanceTransactions table. What is the result?

Accepted Answer

Top 5 account categories by total amount for 2023. Option A is correct. The query filters transactions for the year 2023, groups by AccountCategory, and returns the top 5 categories with highest total amounts. Option B is wrong because it sums by month, not category. Option C is wrong because it returns all, not top 5. Option D is wrong because it's for 2024, not 2023.

Answer

All account categories with their total amounts for 2023

Answer

Monthly total amounts for each account category in 2023

Answer

Top 5 account categories by total amount for 2024

Question 2

A company uses Dynamics 365 Finance. Which TWO features are available in the Cash and Bank Management module?

Accepted Answer

Cash flow forecasting. Bank reconciliation and cash flow forecasting are part of Cash and Bank Management. Fixed assets management is in Fixed assets. Budget control is in Budgeting. Vendor payments are in Accounts payable.

Answer

Vendor payments

Answer

Budget control

Answer

Fixed asset management

Question 3

A company using Dynamics 365 Finance notices that the 'General ledger' trial balance does not match the subledger balances for accounts payable. The discrepancy appears only for a specific vendor. What is the most likely cause?

Accepted Answer

An invoice for the vendor is in 'Pending' status and has not been posted.. Option C is correct because a single unposted invoice would cause a discrepancy for that vendor. Option A is wrong because vendor currency affects exchange rates, not posting status. Option B is wrong because a payment journal being deleted would affect cash, not the AP subledger. Option D is wrong because vendor hold affects future transactions, not existing balances.

Answer

A payment journal was deleted after posting.

Answer

The vendor account is on hold.

Answer

The vendor's currency is different from the company's accounting currency.

Question 4

Refer to the exhibit. The JSON snippet shows a budget register entry configuration in Dynamics 365 Finance. Account '601500-001-023' has financial dimensions: Main account 601500, Department 001, and Project 023. Account '601500-001-024' has dimensions: Main account 601500, Department 001, Project 024. If budget control is enabled for Department 001, what is the total budget amount available for Department 001?

Accepted Answer

80,000 USD. Option D is correct. Both entries have Department 001, so the total budget for that department is 50000 + 30000 = 80000. Option A is wrong because it only includes one account. Option B is wrong because it is the sum of both. Option C is wrong because it is the sum.

Answer

50,000 USD

Answer

30,000 USD

Question 5

A company uses Dynamics 365 Finance and needs to allocate overhead costs from a cost center to multiple departments based on square footage. Which costing method should be used?

Accepted Answer

Cost allocation. Option C is correct because cost allocation in Dynamics 365 Finance allows distributing costs based on allocation bases such as square footage. Option A is wrong because absorption costing assigns costs to products, not departments. Option B is wrong because standard costing is for inventory valuation. Option D is wrong because activity-based costing assigns costs based on activities, but the feature to allocate by square footage is cost allocation.

Answer

Activity-based costing

Answer

Standard costing

Answer

Absorption costing

Question 6

A manufacturing company uses Dynamics 365 Finance to manage its financial operations. The finance team notices that intercompany transactions are not being settled automatically as expected. What should you check first to resolve this issue?

Accepted Answer

Ensure the intercompany setup is correctly configured with appropriate settlement parameters.. Option C is correct because intercompany settlement requires a correct intercompany setup with appropriate parameters, such as settlement priority and rules. Option A is wrong because ledger allocation rules are for allocating amounts, not settling transactions. Option B is wrong because budget control is unrelated to intercompany settlement. Option D is wrong because vendor posting profiles affect vendor transactions, not intercompany settlement.

Answer

Review the vendor posting profiles.

Answer

Verify the ledger allocation rules.

Answer

Check the budget control configuration.

Question 7

Which THREE components are essential for setting up intercompany accounting in Dynamics 365 Finance? (Choose three.)

Accepted Answer

Intercompany relationships.. Options A, C, and E are correct. Intercompany relationships define the legal entities involved, intercompany journals handle transactions, and intercompany settlement ensures balances are settled. Option B is wrong because budget control is optional. Option D is wrong because vendor groups are not specific to intercompany.

Answer

Budget control rules.

Answer

Vendor groups.

Question 8

A company uses Dynamics 365 Finance and needs to ensure that intercompany transactions are eliminated during consolidation. What must be set up?

Accepted Answer

Intercompany elimination rules. Option D is correct. Intercompany elimination rules in the consolidation module automatically remove intercompany transactions. Option A is wrong because intercompany accounting processes transactions but doesn't eliminate them. Option B is wrong because consolidation groups are for grouping entities. Option C is wrong because financial dimensions are for reporting, not elimination.

Answer

Financial dimensions for intercompany

Answer

Consolidation groups

Answer

Intercompany accounting

Question 9

A company uses Dynamics 365 Finance to manage its accounts payable. The AP clerk receives an invoice that does not have a purchase order. Which document type should the clerk use to record the invoice?

Accepted Answer

Vendor invoice journal. Purchase order invoice requires a PO. Vendor invoice journal is for invoices without PO. Invoice pool is for hold. Vendor invoice workspace is a landing page.

Answer

Purchase order invoice

Answer

Vendor invoice workspace

Answer

Invoice pool

Question 10

Refer to the exhibit. A journal entry in Dynamics 365 Finance shows a debit to account 1100-001-01 and offset to account 2100-002-02. The financial dimensions include Department=Sales and CostCenter=CC001. What is the purpose of this entry?

Accepted Answer

Increasing cash and increasing a liability. Account 1100 is typically Cash (asset). Account 2100 is typically Accounts Payable (liability). Debiting Cash and crediting AP does not make sense for payment. A debit to Cash (increase) and credit to AP (increase) is unusual; more likely it's a receipt from a vendor refund. But typical: debit Cash, credit AP means receiving cash and reducing liability? Actually debit Cash increases, credit AP increases liability. That would be a loan or refund. Option D matches: increasing cash and increasing liability (e.g., receiving a deposit).

Answer

Recording a customer payment

Answer

Recording a vendor payment

Answer

Reclassifying a bank transaction

Question 11

A company is implementing Dynamics 365 Finance and needs to track expenses by department and project. What dimension combination should be used?

Accepted Answer

Department and Project. Option A is correct because department and project are financial dimensions. Option B is wrong because vendor is a party, not a dimension. Option C is wrong because location is a dimension but not typically used for expense tracking. Option D is wrong because item is a product dimension.

Answer

Department and Vendor

Answer

Item and Project

Answer

Location and Cost center

Question 12

A retail company uses Dynamics 365 Finance to manage its fixed assets. They purchase a new delivery truck. Which fixed asset transaction type should they use to record the purchase?

Accepted Answer

Acquisition. Option B is correct because acquisition records the purchase of a fixed asset. Option A is wrong because depreciation records the value decrease over time. Option C is wrong because disposal records the sale or retirement. Option D is wrong because impairment records a permanent decline in value.

Answer

Impairment

Answer

Disposal

Answer

Depreciation

Question 13

Refer to the exhibit. The exhibit shows the main account balance and transactions for a checking account. What is the balance after all transactions are posted?

Accepted Answer

35000. Option C is correct: starting balance 50000 + debit 10000 - credit 5000 - credit 20000 = 35000. Option A is wrong because it adds all debits and credits incorrectly. Option B is wrong because it ignores the starting balance. Option D is wrong because it miscalculates.

Answer

30000

Answer

40000

Answer

45000

Question 14

A multinational corporation uses Dynamics 365 Finance and needs to report in both local GAAP and IFRS. What is the recommended approach?

Accepted Answer

Use multiple ledgers with different accounting frameworks.. Option D is correct. Dynamics 365 Finance supports multiple ledgers, each representing a different accounting standard. Option A is wrong because using two instances is unnecessary and complex. Option B is wrong because consolidations are for combining entities, not dual reporting. Option C is wrong because financial dimensions cannot replace separate ledgers for different GAAPs.

Answer

Set up two separate instances of Dynamics 365 Finance.

Answer

Use the consolidation module to convert IFRS to local GAAP.

Answer

Configure financial dimensions to differentiate GAAPs.

Question 15

A manufacturing company uses Dynamics 365 Finance to manage its inventory. The company wants to ensure that the cost of raw materials is updated automatically when purchase orders are invoiced. Which costing method should the company use?

Accepted Answer

Moving average. Standard costing updates costs based on predetermined standards, not automatically from purchase invoices. Weighted average and moving average can update on invoice posting. FIFO tracks actual cost layers. Moving average is commonly used for real-time cost updates.

Answer

FIFO

Answer

Standard costing

Answer

Weighted average

MB-920 Practice Test 42 — 15 Questions

Exhibit

MB-920 Practice Test 42 — 15 Questions

Exhibit