MB-920 Describe the core capabilities of the finance and operations apps Practice Test 18 — 15 Questions

Question 1

A company is implementing Dynamics 365 Finance. The controller wants to streamline the process of recording vendor invoices that are received without a corresponding purchase order, such as utility bills and professional fees. The invoices must be matched to the correct expense accounts and cost centers. Which capability should you recommend?

Choose an answer to begin — your selection is scored in the full session.

Accepted Answer

Use the Invoice register and Invoice approval journals in Accounts payable to record and post vendor invoices.. The Invoice register and Invoice approval journals are specifically designed to handle vendor invoices that are not associated with a purchase order. They allow the accounting team to enter invoice details, distribute amounts to the appropriate expense accounts and cost centers, and then post the invoice. This provides the control and accuracy the controller requires for non-PO invoices.

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Use the Vendor invoice journal to record and post vendor invoices directly.

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Use the Accounts payable payment proposal to generate payments for non-PO invoices.

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Use the Purchase order invoice matching policy to automatically post non-PO invoices.

Question 2

A company uses Dynamics 365 Supply Chain Management. The warehouse manager needs to ensure that the system automatically suggests replenishment of raw materials based on minimum and maximum stock levels. Which master planning feature should be configured?

Accepted Answer

Coverage groups with Min/Max planning. Coverage groups in master planning determine how an item is replenished. When you set up a coverage group with Min/Max planning, you specify minimum and maximum inventory levels. Master planning then creates planned orders to replenish stock when it drops below the minimum, up to the maximum. This automates the replenishment process as required.

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Item coverage groups with period coverage

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Warehouse work policies

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Safety stock journals

Question 3

A company uses Dynamics 365 Finance to manage its financial operations. The controller wants to understand how the system ensures that all financial transactions are recorded in a balanced way. Which core capability of Dynamics 365 Finance supports this requirement?

Accepted Answer

General ledger. The general ledger is the central repository for all financial transactions in Dynamics 365 Finance. It uses double-entry accounting to ensure that every transaction is balanced, meaning total debits equal total credits. This capability is fundamental for accurate financial reporting and compliance.

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Accounts payable

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Budgeting

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Fixed assets

Question 4

A company is implementing Dynamics 365 Finance. The controller wants to streamline the process of recording vendor invoices that are received without a corresponding purchase order, such as utility bills and professional fees. The invoices must be matched to the correct expense accounts and cost centers. Which capability should you recommend?

Choose an answer to begin — your selection is scored in the full session.

Accepted Answer

Accounts payable invoice matching. Accounts payable invoice matching is the feature designed to compare vendor invoice lines with purchase order lines and product receipt lines. It supports two-way and three-way matching and can enforce tolerances and approval workflows. This ensures that invoices are only paid after they are verified against the original order and receipt, directly satisfying the controller's control requirement.

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Budget control

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Procurement and sourcing workflows

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Vendor collaboration workspace

Question 5

A multinational company uses Dynamics 365 Finance to manage its financial operations across multiple legal entities. The controller needs to consolidate financial results from all entities into a single consolidated report, ensuring that intercompany transactions are automatically eliminated. Which feature in Dynamics 365 Finance should the controller use?

Accepted Answer

Financial consolidation. The financial consolidation feature in Dynamics 365 Finance is designed to combine financial data from multiple legal entities into a single consolidated entity. It includes the ability to automatically eliminate intercompany transactions, which is essential for accurate consolidated reporting. Consolidation accounts are used within this feature to map accounts, but the overall capability is financial consolidation.

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Financial dimensions

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Consolidation accounts

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Intercompany accounting

Question 6

A company uses Dynamics 365 Finance to manage its financial operations. The accounting manager needs to ensure that all journal entries posted to the general ledger are automatically reviewed by a supervisor before they are finalized. The company also wants to maintain an audit trail of who approved each entry and when. Which feature should the manager configure?

Accepted Answer

Set up a journal workflow for the general journal.. A journal workflow in Dynamics 365 Finance is designed to route journal entries through an approval process before they are posted. It ensures that a supervisor reviews and approves entries, and it records the approval history. This provides both the required control and the audit trail, making it the appropriate configuration for the scenario.

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Configure ledger posting definitions.

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Enable budget control on the main account.

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Set up financial dimensions for the journal.

Question 7

A distribution company uses Dynamics 365 Supply Chain Management. They need to plan and optimize transportation routes for outbound deliveries, considering multiple stops and vehicle capacities. Which module should they use?

Accepted Answer

Transportation management. Transportation management is the dedicated module for planning and optimizing transportation, including outbound deliveries. It provides load planning, route planning, and rating capabilities that consider multiple stops, vehicle capacities, and time windows. This directly addresses the distribution company's need to optimize outbound delivery routes.

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Master planning

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Warehouse management

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Inventory management

Question 8

A company uses Dynamics 365 Supply Chain Management to manage its warehouse operations. They need to ensure that inventory is stored in the most efficient locations based on demand and product characteristics. Which capability should they use?

Accepted Answer

Warehouse management. Warehouse management in Dynamics 365 Supply Chain Management includes tools like location directives, work templates, and slotting to optimize where inventory is stored. These features consider demand patterns and product attributes to assign the best locations, reducing travel time and improving operational efficiency.

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Procurement and sourcing

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Transportation management

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Inventory management

Question 9

A company uses Dynamics 365 Supply Chain Management to manage its warehouse operations. The warehouse manager needs to configure the system to suggest the optimal picking route for warehouse workers based on the physical layout of the warehouse. Which feature should the manager use?

Accepted Answer

Route planning. Route planning is the feature that calculates the optimal sequence of locations for picking or putting away items, based on the warehouse layout. It helps reduce travel time and improve efficiency. While location directives and work templates are related, they do not provide route optimization based on physical layout.

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Warehouse layout

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Location directives

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Work templates

Question 10

A company uses Dynamics 365 Finance. The accounting manager wants to ensure that the general ledger reflects the financial impact of inventory transactions only after all inventory movements for a period are finalized. They decide to run the inventory closing process. What is the primary purpose of inventory closing in Dynamics 365 Supply Chain Management?

Accepted Answer

To calculate the cost of goods sold and adjust inventory balances for the period.. Inventory closing is a periodic process that finalizes the cost of inventory transactions, ensuring that issues are matched with receipts and that the general ledger reflects accurate inventory values and cost of goods sold. It does not handle physical counts, replenishment, or transfers, which are separate operational tasks. The correct answer aligns with the manager's need to post financial adjustments after all movements are complete.

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To automatically generate purchase orders for replenishing stock.

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To transfer inventory between warehouses based on demand forecasts.

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To perform a physical count of inventory and adjust quantities on hand.

Question 11

A company uses Dynamics 365 Finance. They need to allocate indirect costs to multiple departments based on statistical data such as square footage. The allocation should be performed automatically at month-end. Which feature should they use?

Accepted Answer

Cost accounting allocation. Cost accounting allocation is designed specifically for distributing indirect costs across cost centers using allocation bases. It supports statistical bases such as square footage, headcount, or machine hours. Allocation rules can be scheduled to run automatically at month-end, ensuring accurate and timely cost distribution. This feature directly addresses the company's need for automated indirect cost allocation.

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Financial dimensions

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Ledger allocations

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Budgeting

Question 12

A multinational organization uses Dynamics 365 Finance to manage its financial operations across multiple legal entities. The company needs to consolidate financial data from several subsidiaries into a single parent company for reporting purposes. The subsidiaries use different currencies and chart of accounts. Which feature in Dynamics 365 Finance should the company use to combine the financial results?

Accepted Answer

Financial consolidation. Financial consolidation is the correct feature because it is specifically designed to aggregate financial data from multiple legal entities into a single consolidated entity. It supports currency translation and account mapping, which are essential when subsidiaries use different currencies and charts of accounts. This enables the organization to produce consolidated financial statements for reporting.

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Advanced ledger entries

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Intercompany accounting

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Budgeting

Question 13

A distribution company uses Dynamics 365 Supply Chain Management. The warehouse manager wants to configure the system to automatically suggest replenishment of items from a main warehouse to a retail store when the store's inventory falls below a specified minimum. Which feature should the manager use to achieve this?

Accepted Answer

Master planning with coverage groups and minimum keys.. Master planning in Dynamics 365 Supply Chain Management analyzes current inventory and demand to generate planned orders, including transfer orders. By configuring coverage groups with minimum quantities for the retail store, the system will suggest replenishment from the main warehouse when stock falls below the minimum. This provides the automated suggestion the manager needs.

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Vendor collaboration with purchase requisitions.

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Inventory blocking with quality orders.

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Warehouse management with work templates.

Question 14

A company is implementing Dynamics 365 Finance. The controller wants to streamline the process of recording vendor invoices that are received without a corresponding purchase order, such as utility bills and professional fees. The invoices must be matched to the correct expense accounts and cost centers. Which capability should you recommend?

Choose an answer to begin — your selection is scored in the full session.

Accepted Answer

Creation and management of chart of accounts and financial dimensions. The General ledger module in Dynamics 365 Finance provides the foundational financial structure, including the chart of accounts, financial dimensions, and the ability to create and post journal entries with accounting distributions. These capabilities are essential for recording and reporting financial transactions. Other functions like vendor payments, sales tax setup, and fixed asset management are handled by dedicated modules, not the General ledger.

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Processing of vendor payments and management of vendor master records

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Management of fixed asset acquisitions, depreciation, and disposal

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Configuration of sales tax codes and sales tax groups for indirect taxation

Question 15

A company uses Dynamics 365 Finance to manage its accounts payable processes. The accounting manager needs to ensure that vendor invoices are automatically matched to purchase orders and product receipts before payment. The manager also wants to allow a tolerance for price and quantity differences. Which feature should the manager configure?

Accepted Answer

Invoice matching. Invoice matching is the feature that automates the comparison of vendor invoices with purchase orders and product receipts. It supports the configuration of matching policies that define tolerances for price and quantity variances. This ensures that invoices are validated before payment, reducing errors and manual effort.

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Accounts payable invoice journal

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Payment proposal

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Vendor collaboration