MB-920 Describe the core capabilities of the finance and operations apps Practice Test 3 — 15 Questions

Question 1

A company uses Dynamics 365 Finance and needs to generate financial statements that comply with both local GAAP and IFRS. They want to avoid maintaining separate sets of books. Which feature should they use?

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

Accepted Answer

Financial reporting. Financial reporting in Dynamics 365 Finance allows organizations to create, maintain, and deploy financial statements that comply with multiple accounting standards (e.g., local GAAP and IFRS) from a single set of financial data. It uses reporting trees and row/column definitions to generate different report formats without requiring separate ledger structures, thus avoiding the need for duplicate books.

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Dual ledger

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Consolidation

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Intercompany accounting

Question 2

Which TWO capabilities are core to Dynamics 365 Supply Chain Management?

Accepted Answer

Warehouse management. Warehouse management (B) is a core capability of Dynamics 365 Supply Chain Management, providing advanced inbound and outbound warehouse operations, wave processing, and location directives. Transportation management (E) is also core, offering freight rating, routing, and shipment consolidation to optimize logistics. Together, they directly support the end-to-end supply chain processes within the application.

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Project cost management

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Omnichannel order management

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Financial reporting

Question 3

Which THREE capabilities are core to Dynamics 365 Finance?

Accepted Answer

General ledger. General ledger is a core capability of Dynamics 365 Finance because it serves as the central repository for all financial transactions, providing the foundation for financial reporting, account structures, and fiscal period management. It enables organizations to maintain a complete audit trail and comply with accounting standards such as GAAP and IFRS.

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Production control

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Warehouse management

Question 4

Which TWO capabilities are core to Dynamics 365 Commerce?

Accepted Answer

Loyalty management. Loyalty management is a core capability of Dynamics 365 Commerce because it enables retailers to create, manage, and execute loyalty programs (e.g., points-based, tiered) directly within the omnichannel commerce platform. Product recommendations are also core, leveraging AI and machine learning to provide personalized product suggestions across e-commerce and point-of-sale (POS) channels, driving cross-sell and up-sell opportunities.

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Project cost management

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Transportation management

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Budget control

Question 5

Refer to the exhibit. This JSON snippet represents a budget record in Dynamics 365 Finance. Which core capability is being configured?

Accepted Answer

Budget control. The JSON snippet defines budget control parameters such as 'BudgetControlConfiguration', 'BudgetCycle', and 'BudgetInterval', which are used to enforce budget checks during financial transactions. This directly configures the Budget Control module in Dynamics 365 Finance, enabling organizations to monitor and restrict expenditures against approved budgets.

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Fixed asset management

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Project accounting

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General ledger

Question 6

Refer to the exhibit. This XML snippet shows a workflow configuration in Dynamics 365 Finance. What is the purpose of this workflow?

Accepted Answer

To automate purchase order approval based on amount. The workflow configuration in Dynamics 365 Finance uses a condition based on the purchase order amount to trigger an approval step. This is the core purpose of a purchase order approval workflow: to automatically route purchase orders for approval when they exceed a defined monetary threshold, ensuring proper authorization before the order is processed.

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To enforce budget control on purchase orders

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To facilitate vendor collaboration

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To match purchase orders with invoices

Question 7

Refer to the exhibit. This data represents a product record in Dynamics 365 Commerce. Which core capability is demonstrated by applying a 10% discount from a promotion?

Accepted Answer

Customer engagement and loyalty management. Applying a 10% discount from a promotion directly demonstrates the customer engagement and loyalty management capability in Dynamics 365 Commerce. This feature allows businesses to create and manage promotional pricing rules, such as percentage discounts, to incentivize purchases and reward customer loyalty. The discount is applied at the point of sale or online checkout based on configured promotion logic, not through inventory or order management processes.

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Omnichannel order management

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Inventory visibility

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Price synchronization

Question 8

A manufacturing company uses Dynamics 365 Supply Chain Management. They want to reduce inventory holding costs by implementing a strategy where materials are ordered only when needed for production. Which inventory strategy should they use?

Accepted Answer

Just-in-time (JIT). Just-in-time (JIT) is the correct inventory strategy because it aligns with the goal of reducing holding costs by ordering materials only when they are needed for production. In Dynamics 365 Supply Chain Management, JIT can be implemented using kanban rules and lean manufacturing principles, which trigger replenishment based on actual consumption rather than forecasted demand, minimizing inventory levels.

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Reorder point

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Economic order quantity (EOQ)

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Safety stock

Question 9

A retail company uses Dynamics 365 Commerce. They notice that the online store is not syncing inventory levels correctly from the warehouse management system. Which component should they troubleshoot first?

Accepted Answer

Commerce Data Exchange (CDX). Commerce Data Exchange (CDX) is the component responsible for synchronizing data between Dynamics 365 Commerce and the warehouse management system. Since inventory levels are not syncing correctly, CDX is the first component to troubleshoot because it handles the data transfer and transformation processes that keep inventory records consistent across channels.

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Retail Cloud Scale Unit (RCSU)

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Product catalog

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Point of sale (POS) system

Question 10

A company uses Dynamics 365 Project Operations. They need to track project costs and revenue recognition in real time. Which module should they use?

Accepted Answer

Project Operations. Dynamics 365 Project Operations is the dedicated module for managing the entire project lifecycle, including cost tracking and revenue recognition in real time. It integrates project planning, resource management, and financials to ensure that project costs and revenue are recognized accurately as work progresses, without needing to switch to separate modules.

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Finance

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Commerce

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Supply Chain Management

Question 11

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.

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Budgeting

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General ledger

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Tax engine

Question 12

A company uses Dynamics 365 Supply Chain Management. They are experiencing delays in production because the system does not automatically order raw materials when inventory drops below a certain level. Which master planning parameter should be configured to address this?

Accepted Answer

Reorder point. The reorder point (Option D) is the correct parameter to configure for automatic ordering when inventory drops below a certain level. In Dynamics 365 Supply Chain Management, the reorder point defines a minimum inventory level that triggers a planned order for replenishment. Coverage groups (Option A) define planning parameters for groups of items but do not directly trigger automatic ordering. Safety stock (Option B) is a buffer level to protect against uncertainty but does not initiate orders. Forecast (Option C) is used for demand estimation, not for automatic replenishment.

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Coverage group

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Safety stock

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Forecast

Question 13

A company uses Dynamics 365 Human Resources. They want to streamline the employee onboarding process by automating document collection and task assignments. Which feature should they use?

Accepted Answer

Personnel management. Personnel management in Dynamics 365 Human Resources provides the 'Hire' and 'Onboard' workflows that automate document collection (e.g., tax forms, employment agreements) and task assignments (e.g., IT setup, training) during employee onboarding. This feature uses configurable checklists and document templates to streamline the process, directly addressing the requirement.

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Benefits management

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Time and attendance

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Compensation management

Question 14

A company uses Dynamics 365 Commerce. They need to offer a promotion where customers get a 10% discount on a specific product line. Which pricing mechanism should they configure?

Accepted Answer

Retail discount. A retail discount is the correct pricing mechanism for a broad promotion offering a 10% discount on a product line to all customers. Retail discounts in Dynamics 365 Commerce are designed for promotional pricing that applies to a wide audience, such as percentage off on specific products or categories. Unlike trade agreements, which are for negotiated prices with specific customers or vendors, retail discounts are ideal for general promotions.

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Trade agreement

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Price adjustment

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Coupon

Question 15

A company uses Dynamics 365 Finance. They want to automatically generate and post vendor payments based on approved invoices. Which feature should they use?

Accepted Answer

Payment proposal. The Payment proposal feature in Dynamics 365 Finance allows users to automatically generate and post vendor payments based on approved invoices. It selects due invoices according to defined criteria (e.g., due date, discount date) and creates payment journal lines, which can then be posted. This directly meets the requirement of automating payment generation from approved invoices.

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Electronic payment

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Vendor invoice automation

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Workflow