MB-920 Describe the core capabilities of the finance and operations apps Practice Test 11 — 15 Questions

Question 1

An organization uses Dynamics 365 Supply Chain Management. They want to ensure that a vendor invoice cannot be posted if the purchase order has not been received. What feature should they enable?

Accepted Answer

Invoice matching validation. Invoice matching validation, is correct because it enforces a three-way matching policy where the vendor invoice cannot be posted unless the quantities and amounts match the corresponding purchase order receipt. This ensures that the invoice is validated against the received goods before posting, preventing payment for un-received items.

Answer

Invoice hold

Answer

Purchase order approval workflow

Answer

Budget control

Question 2

A company uses Dynamics 365 Finance and wants to automate the reconciliation of bank transactions with general ledger entries. Which feature should they use?

Accepted Answer

Advanced bank reconciliation. Advanced bank reconciliation in Dynamics 365 Finance automates the matching of bank statement lines with open bank document lines (e.g., checks, deposits) and general ledger entries. It uses matching rules and algorithms to suggest or auto-apply matches, reducing manual effort. This feature is specifically designed for high-volume, automated reconciliation scenarios, unlike the basic Bank reconciliation feature which requires manual matching.

Answer

Electronic reporting

Answer

Bank reconciliation

Answer

Cash and bank management

Question 3

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 4

Which TWO capabilities are part of Dynamics 365 Finance and Operations core capabilities? (Choose two.)

Accepted Answer

Supply chain management. Supply chain management is a core capability of Dynamics 365 Finance and Operations because it provides end-to-end visibility and control over procurement, inventory, warehousing, and logistics. This module integrates directly with financial management to ensure real-time cost tracking and compliance across the supply chain.

Answer

Customer relationship management

Answer

Human resources

Answer

Marketing

Question 5

Which THREE features are available in Dynamics 365 Supply Chain Management? (Choose three.)

Accepted Answer

Transportation management. Transportation management is a core feature of Dynamics 365 Supply Chain Management that enables businesses to manage inbound and outbound shipments, rate shopping, route planning, and freight reconciliation. It integrates with warehouse and production modules to optimize logistics and carrier selection.

Answer

Project management

Answer

Retail management

Question 6

Which TWO are components of Dynamics 365 Finance? (Choose two.)

Accepted Answer

Accounts payable. Accounts payable is a core component of Dynamics 365 Finance that manages vendor invoices, payments, and purchase transactions. It integrates with the general ledger to ensure accurate financial reporting and supports automated payment processing and vendor reconciliation.

Answer

Production control

Answer

Sales order management

Answer

Inventory management

Question 7

A company is configuring a main account for Cash in the legal entity USMF. Based on the exhibit, what is the main account type?

Accepted Answer

Asset. In the exhibit, the main account for Cash is configured with a main account type of 'Asset'. In Dynamics 365 Finance, the main account type determines how the account is used in financial reports and posting. Cash is a current asset, so it must be classified as an Asset account type to correctly represent the company's financial position on the balance sheet.

Answer

Liability

Answer

Expense

Answer

Equity

Question 8

A batch job in Dynamics 365 Supply Chain Management is recalculating inventory on-hand and is currently at 45% progress. The job has been running for 2 hours. What should the administrator do to analyze performance?

Accepted Answer

Review the batch job history for execution details. Reviewing the batch job history provides detailed execution logs, including step-by-step progress, error messages, and performance metrics such as duration per task. This allows the administrator to identify bottlenecks or failures in the recalculation process without interrupting the job. The batch job history is the primary diagnostic tool for analyzing long-running jobs in Dynamics 365 Supply Chain Management.

Answer

Check the status of other batch jobs

Answer

Configure a batch job alert

Answer

Cancel the job and restart it

Question 9

A manufacturing company uses Dynamics 365 Finance and Operations. They need to track the cost of raw materials as they move through production. Which costing method should they use to ensure that inventory valuation reflects the most recent purchase prices?

Accepted Answer

FIFO. FIFO (First In, First Out) is the correct costing method because it assumes that the oldest inventory items are used first, leaving the most recently purchased items in stock. This ensures that the inventory valuation on the balance sheet reflects the most recent purchase prices, which aligns with the requirement to track costs as raw materials move through production in Dynamics 365 Finance and Operations.

Answer

LIFO

Answer

Weighted average

Answer

Standard cost

Question 10

A company uses Dynamics 365 Finance to manage intercompany transactions. They need to automate the elimination of intercompany sales and purchases during consolidation. What feature should they configure?

Accepted Answer

Intercompany elimination rules. Intercompany elimination rules in Dynamics 365 Finance are specifically designed to automate the removal of intercompany sales and purchase transactions during the consolidation process. These rules define matching criteria (e.g., intercompany trade agreements, dimensions) and generate elimination entries that offset the intercompany revenue and expense, ensuring the consolidated financial statements reflect only external transactions.

Answer

Fixed asset management

Answer

Budget control

Answer

Vendor collaboration

Question 11

A company uses Dynamics 365 Supply Chain Management. They want to use AI to predict potential stockouts and suggest reorder quantities. Which feature should they enable?

Accepted Answer

Demand forecasting. Demand forecasting in Dynamics 365 Supply Chain Management uses AI and machine learning to analyze historical transaction data, predict future demand, and proactively identify potential stockouts. It also suggests optimal reorder quantities to maintain inventory levels, directly addressing the scenario's need for AI-driven stockout prediction and replenishment recommendations.

Answer

Product configuration

Answer

Inventory Visibility

Answer

Warehouse management

Question 12

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 13

An organization uses Dynamics 365 Project Operations. They need to track employee time against a project and automatically bill the customer based on the time entries. Which module should they configure?

Accepted Answer

Project management and accounting. In Dynamics 365 Project Operations, the Project management and accounting module is specifically designed to track employee time against projects and automatically generate customer invoices based on time entries. This module integrates time recording with billing rules, enabling automated invoicing from approved timesheets. The other modules lack the project-specific time-to-bill workflow.

Answer

Human resources

Answer

Accounts receivable

Answer

Expense management

Question 14

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 15

A company uses Dynamics 365 Supply Chain Management. They need to track the serial numbers of products sold to customers for warranty management. Which inventory configuration should they use?

Accepted Answer

Serial number tracking. Serial number tracking is the correct inventory configuration because it allows the company to assign a unique identifier to each individual unit of a product. This enables precise tracking of which specific item was sold to which customer, which is essential for managing warranty claims, returns, and service history in Dynamics 365 Supply Chain Management.

Answer

Batch tracking

Answer

Location tracking

Answer

Product dimensions