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

Question 1

A company uses Dynamics 365 Finance and Operations. They need to ensure that only authorized users can approve purchase orders above $10,000. Which TWO features should they configure?

Accepted Answer

Purchase order workflow. Purchase order workflows in Dynamics 365 Finance and Operations allow you to define conditional approval rules, such as requiring additional approvers when the order total exceeds $10,000. This ensures that only authorized users can approve high-value purchase orders by routing them through a predefined approval process.

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User roles

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Electronic signatures

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Segregation of duties

Question 2

A company uses Dynamics 365 Supply Chain Management. They need to improve the accuracy of demand forecasting by incorporating external data such as weather forecasts and economic indicators. Which THREE features should they consider?

Accepted Answer

Demand forecasting. Demand forecasting in Dynamics 365 Supply Chain Management uses historical transaction data and can be extended with external data sources like weather and economic indicators through Azure Machine Learning. This integration improves forecast accuracy by applying machine learning models that correlate external factors with demand patterns.

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Inventory visibility

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Master planning

Question 3

A company uses Dynamics 365 Finance and Operations. They want to use Copilot to assist with financial analysis. Which TWO tasks can Copilot perform?

Accepted Answer

Provide insights on financial data. Copilot in Dynamics 365 Finance and Operations uses AI to analyze financial data and provide actionable insights, such as identifying spending trends or anomalies, without requiring manual data manipulation. This aligns with Copilot's natural language query capabilities that surface key metrics from transactional data.

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Automatically post journal entries

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Configure system parameters

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Create new legal entities

Question 4

A company uses Dynamics 365 Supply Chain Management. They need to ensure that when a sales order is created, the system automatically checks credit limits and inventory availability. Which THREE components are involved?

Accepted Answer

Inventory management. Inventory management (B) is correct because it tracks stock levels and provides real-time inventory availability checks when a sales order is created. Sales order processing (D) is correct because it triggers the credit limit and inventory checks during order entry. Accounts receivable (E) is correct because it maintains customer credit limits and evaluates them against the order total to approve or block the sale.

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Procurement and sourcing

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Master planning

Question 5

You are a Dynamics 365 consultant for a multinational manufacturing company that operates in three countries: USA, Germany, and Japan. The company uses Dynamics 365 Finance and Operations. They have the following requirements: 
- Each country must have its own set of financial reports that comply with local accounting standards (US GAAP, German HGB, Japanese GAAP). 
- The company needs to consolidate financials at the global level on a monthly basis. 
- They want to use a single instance of Dynamics 365 Finance and Operations. 
- All subsidiaries must share the same chart of accounts to facilitate consolidation. 
Which approach should you recommend?

Accepted Answer

Set up one legal entity with financial dimensions to represent each country. Configure local reporting by using financial dimension sets.. Using a single legal entity with financial dimensions to represent each country allows the company to maintain a single instance of Dynamics 365 Finance and Operations while enabling local financial reporting (US GAAP, German HGB, Japanese GAAP) through dimension-based filtering. The shared chart of accounts supports global consolidation, and financial dimension sets can isolate country-specific transactions for local compliance without requiring separate legal entities or instances.

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Create a separate legal entity for each country. Consolidate financials using the Consolidation module.

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Use one legal entity for the USA and set up separate instances for Germany and Japan.

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Implement one legal entity and use different fiscal calendars for each country.

Question 6

You are a system administrator for a company that uses Dynamics 365 Supply Chain Management. The warehouse manager reports that pickers are frequently going to the wrong locations for items, causing delays. The warehouse uses a directed putaway and picking process. Currently, location profiles are set up but not optimized. The manager wants to ensure that items are stored in locations that minimize travel time and that pickers are directed to the correct locations. The warehouse has 10,000 SKUs and high turnover. Which configuration should you implement?

Accepted Answer

Use the location stocking limits and zone-based slotting to assign items to optimal locations based on velocity.. Location stocking limits and zone-based slotting in Dynamics 365 Supply Chain Management allow you to assign items to optimal locations based on velocity (pick frequency). This ensures high-turnover items are stored in easily accessible zones, minimizing travel time and directing pickers to correct locations, directly addressing the warehouse manager's requirements.

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Configure wave processing for order picking.

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Implement barcode scanning for all warehouse transactions.

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Set up location profiles with fixed locations for all SKUs.

Question 7

You are a Dynamics 365 Finance consultant for a company that is implementing Dynamics 365 Finance. The company has a requirement to track expenses by project and by department. They plan to use financial dimensions. However, the finance team is unsure how to set up the dimensions to meet both reporting needs. They want to ensure that all transactions can be analyzed by both project and department. The company has 50 departments and 200 active projects. Which configuration should you recommend?

Accepted Answer

Create separate financial dimensions for Project and Department. Assign both dimensions to all transactions.. Financial dimensions in Dynamics 365 Finance are designed to track multiple analytical categories independently. By creating separate dimensions for Project and Department and assigning both to all transactions, the company can report on expenses by either dimension or a combination of both, meeting the requirement without forcing a hierarchical or concatenated structure.

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Use default dimensions on legal entity and override on each transaction.

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Use account structures to embed department and project in the main account.

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Create one financial dimension that combines project and department as a single value.

Question 8

A manufacturing company uses Dynamics 365 Finance and Operations to manage its production processes. They need to track the consumption of raw materials and labor during the production run. Which module should they use to capture this data in real time?

Accepted Answer

Production control. Production control is the correct module because it is specifically designed to manage and execute production orders, including real-time registration of raw material consumption (via pick lists or reporting as finished) and labor hours (via route card or job card entries). This data is captured directly against the production order, enabling accurate tracking of actual costs during the production run.

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Cost accounting

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Procurement and sourcing

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Inventory management

Question 9

A retailer using Dynamics 365 Commerce wants to offer a discount to customers who purchase a specific combination of items. The discount should be applied automatically at the point of sale. Which type of pricing rule should they configure?

Accepted Answer

Mix and match discount. A mix and match discount is the correct pricing rule because it is specifically designed for scenarios where a discount is applied when a customer purchases a predefined combination of distinct items. In Dynamics 365 Commerce, this rule automatically triggers at the point of sale when the qualifying product set is scanned, without requiring manual intervention.

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Quantity discount

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Simple discount

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Threshold discount

Question 10

A company uses Dynamics 365 Project Operations for project-based work. They need to ensure that subcontractor expenses are billed to the customer at a markup. Which configuration should they set up?

Accepted Answer

Create an expense category with a sales price markup percentage. To bill subcontractor expenses to a customer at a markup, you must configure an expense category with a sales price markup percentage. This allows the system to automatically calculate the billable amount by applying the markup to the actual cost of the subcontractor expense, ensuring the customer is charged the marked-up price.

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Define a project contract with a cost-plus pricing template

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Configure billing rules on the project contract

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Set up a fee schedule for subcontractor expenses

Question 11

An organization uses Dynamics 365 Finance and Operations and wants to automatically reconcile bank transactions with general ledger entries. Which feature should they use?

Accepted Answer

Bank reconciliation. Bank reconciliation in Dynamics 365 Finance and Operations is the correct feature because it is specifically designed to automatically match bank statement transactions with general ledger entries, identifying discrepancies and ensuring financial accuracy. It uses imported bank statement data to reconcile against posted ledger transactions, supporting both manual and automated matching rules.

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Payment schedule

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Advanced ledger entries

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Cash flow forecasting

Question 12

Which TWO core capabilities are part of Dynamics 365 Human Resources? (Choose two.)

Accepted Answer

Employee self-service. Employee self-service (A) is a core capability of Dynamics 365 Human Resources because it allows employees to view and update their personal information, request time off, and access pay slips without administrator intervention. Leave and absence management (E) is also a core capability, providing configurable leave plans, accrual rules, and workflows for requesting and approving time off. Both features are built into the Human Resources module of Dynamics 365 Finance and Operations apps.

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Talent acquisition

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Payroll integration

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Learning management

Question 13

A company implements Dynamics 365 Supply Chain Management. Which THREE features are part of the core capabilities of the warehouse management module? (Choose three.)

Accepted Answer

Location directives. Location directives are a core capability of the warehouse management module because they define rules that determine the pick and put locations for inventory movements. They guide the system to the correct physical location in the warehouse based on criteria such as item, quantity, and zone, ensuring efficient material flow.

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Procurement catalogs

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Demand forecasting

Question 14

An organization uses Dynamics 365 Finance to manage fixed assets. Which THREE capabilities are part of the fixed assets module? (Choose three.)

Accepted Answer

Depreciation calculation. The fixed assets module in Dynamics 365 Finance includes automated depreciation calculation using multiple methods (e.g., straight-line, declining balance, sum-of-years-digits). The system applies user-defined depreciation profiles and schedules to systematically allocate the asset's cost over its useful life, generating periodic journal entries without manual intervention.

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Lease accounting

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Impairment testing

Question 15

Refer to the exhibit. The purchase policy 'StandardPurchasePolicy' is configured as shown. A user creates a purchase requisition for $12,000 with a non-catalog item. Which behavior will occur?

Accepted Answer

The requisition is blocked because non-catalog items are not allowed.. The policy requires catalog items (RequireCatalogItems: true) and sets a $10,000 threshold for department manager approval. Since the requisition is for $12,000 (above threshold) and uses a non-catalog item, it will be blocked because RequireCatalogItems is true. Option D is correct. Option A is wrong because non-catalog items are not allowed. Option B is wrong because even if catalog items are required, the threshold triggers approval. Option C is wrong because the policy prevents creation.

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The requisition is created but requires additional approval from a higher level.

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The requisition is created and automatically approved.

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The requisition is created and sent for department manager approval.