MB-310 Practice Test 4 — 25 Questions

Question 1

A company uses Dynamics 365 Finance to process vendor payments. The treasury team wants to generate a payment proposal for a specific vendor group that includes only invoices due in the next 14 days, and they want to exclude any invoices that are on hold. After the proposal is generated, they need to review and remove selected invoices before posting. What should they do?

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

Accepted Answer

Create a payment journal, use the Vendor payment proposal function with a due date filter and a vendor group filter, then manually delete unwanted lines before posting.. The Vendor payment proposal function inside a payment journal is designed exactly for this scenario. It accepts filters such as vendor group and due date, automatically excludes invoices that are on hold, and produces editable journal lines. Because the lines are editable before posting, the team can review the proposal and remove specific invoices, which satisfies both the filtering and the manual review requirements.

Answer

Use the Settle transactions form on the vendor record to mark invoices for payment, then post a payment journal without a proposal.

Answer

Run the Vendor aging report filtered by due date, then create a manual payment journal and enter each invoice line by hand.

Answer

Configure a payment schedule on the vendor record and let the system post payments automatically when invoices become due.

Question 2

A vendor invoice is entered with a total of $10,000. The vendor offers a cash discount of 1% if paid within 10 days. The invoice is paid on day 8. The payment journal is created without manually adjusting the amount. What will be the result when the payment is posted?

Accepted Answer

The payment will be $9,900 and the discount of $100 will be posted to the cash discount account.. When a vendor has a cash discount code and payment is made within the discount period, the system automatically reduces the payment amount by the discount and posts the discount to the cash discount ledger account. In this scenario, the payment becomes $9,900 and $100 is posted to the discount account. Manual adjustment is not required.

Answer

The payment will be $10,000 and the discount will be ignored because the invoice was not marked for discount.

Answer

The payment will be $9,900 but the discount will be posted as a debit to the vendor account.

Answer

The payment will be $10,000 and the discount will be posted as a separate credit to the vendor.

Question 3

A controller is reviewing a vendor invoice that was posted with an incorrect expense amount. The invoice is already posted and the accounting period is still open. The controller needs to correct the expense account and amount while preserving a clear audit trail, and the vendor balance must also be adjusted. Which action should the controller take?

Accepted Answer

Reverse the posted vendor invoice and then enter a new vendor invoice with the corrected expense amount and account.. The supported correction for a posted vendor invoice is to reverse it and then enter a corrected invoice. Reversal creates offsetting ledger and subledger entries, so the vendor balance is restored, and the new invoice records the correct expense account and amount. Both documents remain in the system, providing the audit trail the controller needs. Direct edits or deletions of posted transactions are not allowed.

Answer

Post a general journal entry to move the amount between the expense accounts and leave the vendor balance unchanged.

Answer

Delete the posted vendor invoice and re-enter it with the correct information.

Answer

Edit the posted vendor invoice journal and change the expense amount and main account directly.

Question 4

A company is implementing Dynamics 365 Finance and needs to ensure that when a purchase order invoice is posted, the expense is allocated to the correct department and cost center. The company uses financial dimensions for Department and Cost Center. The vendor invoice must inherit these dimensions from the purchase order line. What should you configure to achieve this?

Accepted Answer

Configure the purchase order line to include the Department and Cost Center dimensions, and ensure that the invoice line inherits them.. The correct approach is to enter the Department and Cost Center dimensions on the purchase order line. When the invoice is generated from the purchase order, the invoice line inherits these dimensions by default. This ensures the expense is allocated correctly without manual re-entry. The system's default behavior carries dimensions from PO to invoice.

Answer

Set up a financial dimension defaulting rule on the vendor account.

Answer

Set up a posting definition to split the expense based on the Department dimension.

Answer

Create an account structure that includes Department and Cost Center, and set them as mandatory.

Question 5

A company uses Dynamics 365 Finance. They need to automatically create collection activities when customer invoices become overdue. Collection activities should be generated based on aging periods, and the system must prevent duplicate activities for the same invoice. Which configuration should you use?

Accepted Answer

Configure collection activities in the Collections page and enable the 'Create collection activities automatically' parameter, then define aging period definitions.. To automatically create collection activities based on aging periods and avoid duplicates, you must configure the collections parameters to enable automatic activity creation and define aging period definitions. The system uses these definitions to identify overdue invoices and then creates activities, checking for existing open activities. Collection letters, workflows, and interest codes serve different purposes and do not fulfill the requirement.

Answer

Create a workflow for collection letters that triggers when an invoice is overdue.

Answer

Set up interest codes and assign them to customer posting profiles to generate activities.

Answer

Set up collection letter sequences and assign them to customer posting profiles.

Question 6

A budget analyst at Contoso needs to transfer budget amounts between two main accounts within the same department for the current fiscal year. Which budget register entry type should the analyst use?

Accepted Answer

Transfer. Transfer entries are the correct mechanism for moving budget amounts between accounts without altering the total budget. They are designed for reallocations and provide a clear audit trail. Other entry types like original budget, revision, and encumbrance serve different purposes and would not correctly reflect the transfer.

Answer

Revision

Answer

Original budget

Answer

Encumbrance

Question 7

A company in Dynamics 365 Finance wants to track the depreciation of its fixed assets for both book and tax purposes. The controller asks the functional consultant to explain how the system supports this dual reporting requirement without duplicating asset records. Which statement best describes the recommended approach?

Accepted Answer

Use multiple books or value models on a single fixed asset record, each configured with its own depreciation profile and posting layer.. The recommended approach is to attach multiple books or value models to a single fixed asset record, each with its own depreciation profile and posting layer. This allows book and tax depreciation to be tracked independently from the same asset, avoiding duplicate records and supporting dual reporting requirements efficiently.

Answer

Post book depreciation to the general ledger and tax depreciation to a separate legal entity, then consolidate the entities for reporting.

Answer

Enable the Dual depreciation feature in Fixed assets parameters, which automatically creates a parallel tax ledger for every book transaction.

Answer

Create two separate fixed asset records for each physical asset, one for book and one for tax, and link them using a parent-child relationship.

Question 8

A US-based legal services firm posts a free-text invoice for $12,000 with payment terms of 2/10, Net 30. The customer emails on day 8 asking to take the discount, but the payment will not arrive until day 15. A collections clerk wants to grant the discount anyway to preserve the relationship. Which Accounts receivable setup should the clerk use to allow the discount after the discount date without editing the original invoice?

Accepted Answer

Use the Allow cash discount after discount date option on the open transaction before applying the payment.. The Allow cash discount after discount date flag on the open customer transaction is the supported mechanism to accept a discount past its expiration. It preserves the original invoice date and due date while posting the discount to the correct ledger account, which is exactly what the legal firm needs when the customer pays late yet still expects the early-payment discount.

Answer

Create a new payment term with the discount calculated on the net amount and assign it to the customer master.

Answer

Change the invoice date to day 15 so the discount window recalculates.

Answer

Post a credit note for the discount amount and apply it against the open invoice.

Question 9

A company uses budget planning in Dynamics 365 Finance. The budget planning process includes multiple stages with workflows. The finance team wants to ensure that when a budget plan is rejected at any stage, it is returned to the originator for revision, and that the originator can resubmit it without creating a new budget plan. Which configuration should you implement?

Accepted Answer

Configure the budget planning workflow to have a rejection action that returns the budget plan to the originator.. To return a rejected budget plan to the originator, the budget planning workflow must be configured with a rejection action that routes the plan back to the originator. This allows the originator to edit and resubmit the same budget plan, preserving the plan's history and data. The stage rules must also permit editing at the origination stage. This is the standard configuration for iterative budget planning.

Answer

Configure the budget planning workflow to have a rejection action that returns the budget plan to the previous stage.

Answer

Create a new budget planning stage specifically for rejected budget plans.

Answer

Set the budget planning stage rule to allow editing of the budget plan after rejection.

Question 10

A public sector organization uses Dynamics 365 Finance budgeting. They need to enforce that purchase orders cannot exceed the available budget for a specific combination of main account and department. Which configuration should they implement?

Accepted Answer

Configure budget control with the 'Prevent' option for the main account and department dimension combination.. Budget control in Dynamics 365 Finance checks transactions against available budget and can be configured to prevent, warn, or allow. The 'Prevent' option stops a transaction from being submitted or posted if it would exceed the remaining budget for the specified dimensions. This is the correct configuration to enforce a hard limit on purchase orders for a main account and department combination.

Answer

Enable budget control for the main account and department, and set the budget control rule to 'Warning'.

Answer

Use budget planning to allocate funds, and rely on workflow approval to prevent overspending.

Answer

Create a budget transfer to increase the budget before entering the purchase order.

Question 11

A consultant is setting up fixed assets in Dynamics 365 Finance for a new legal entity. The company wants to use the fixed asset module to track assets for both financial reporting and tax reporting, with different depreciation methods for each. Which two configurations are required to support this requirement? (Choose two.)

Accepted Answer

Associate both value models with the fixed asset record.. To track fixed assets for both financial and tax reporting with different depreciation methods, you need separate value models for each book and you must associate both value models with each fixed asset. This allows the system to calculate depreciation independently for each book using the respective methods. Fixed asset groups and fiscal calendars are not the determining factors for multiple depreciation methods.

Answer

Create separate fixed asset groups for financial and tax reporting.

Answer

Enable the 'Create depreciation adjustment with basis adjustment' parameter.

Answer

Set up a separate fiscal calendar for each value model.

Question 12

A junior consultant is reviewing budget register entries in Microsoft Dynamics 365 Finance for a client. The client wants to know which entry type increases the available budget balance for a department without requiring a transfer from another department. Which budget register entry type should the consultant identify as increasing available budget?

Accepted Answer

Original budget. Original budget entries are the primary method for loading an approved budget into the system, thereby increasing available budget balances. Transfers, encumbrances, and budget reservations either move funds between dimensions or reduce availability. Only an original budget entry adds new spending authority without drawing from another budget source.

Answer

Transfer

Answer

Budget reservation

Answer

Encumbrance

Question 13

A Contoso finance team discovers that a posted vendor invoice did not undergo budget control even though budget control is enabled for the account structure. The team confirms the invoice was posted through the Accounts payable module. What is the most likely reason the budget check was bypassed?

Accepted Answer

The invoice line used a main account that is excluded from budget control in the budget control configuration.. Budget control checks transactions only for main accounts that are included in a budget control rule. If a vendor invoice uses a main account that is not part of any rule, the transaction will not be checked, even if budget control is enabled for the account structure. This explains a single invoice bypassing control while other transactions are checked. The fix is to add the main account to the appropriate budget control rule.

Answer

The invoice was posted by a user who is not assigned to a budget control user group.

Answer

The vendor invoice was posted with a posting date in a period where budget control is turned off.

Answer

The Budget control configuration is not activated for the current fiscal year.

Question 14

A company has a fixed asset that was acquired with a cost of 50,000 and has accumulated depreciation of 30,000. The company decides to sell the asset for 25,000. The Fixed asset posting profile for disposal-sale is configured with a main account for gain/loss. What is the correct accounting entry for this disposal in Dynamics 365 Finance?

Accepted Answer

Debit Cash 25,000, Debit Accumulated depreciation 30,000, Credit Fixed asset 50,000, Credit Gain on disposal 5,000.. The disposal-sale transaction must remove the asset's original cost and accumulated depreciation, record the cash proceeds, and post the difference between net book value and proceeds to the gain/loss account. With a net book value of 20,000 and proceeds of 25,000, the result is a gain of 5,000, making the entry that debits cash and accumulated depreciation, credits fixed asset, and credits gain correct.

Answer

Debit Accumulated depreciation 30,000, Debit Loss on disposal 20,000, Credit Fixed asset 50,000.

Answer

Debit Cash 25,000, Debit Loss on disposal 5,000, Credit Fixed asset 30,000.

Answer

Debit Cash 25,000, Credit Fixed asset 25,000.

Question 15

A new Accounts payable clerk at Contoso, a legal entity in Dynamics 365 Finance, tries to enter a vendor invoice for a vendor that was created yesterday. The clerk can see the vendor in the Vendors list but receives a message that the vendor is on hold and the invoice cannot be posted. The vendor's on-hold status was set during creation because the vendor's tax registration number had not yet been verified. The clerk needs to post the invoice today without deleting the vendor. What should you do?

Accepted Answer

Change the vendor's On hold status to No on the Vendor details page in the Invoice and delivery FastTab.. The vendor hold status is designed to prevent specific transactions (invoice, payment, etc.) for a vendor. The Invoice and delivery FastTab on the Vendor details page contains the On hold fields. Clearing the Invoice hold allows the clerk to post the pending invoice without altering the vendor's identity or history, which is the correct and least disruptive fix.

Answer

Post the invoice using the Vendor invoice pool, which bypasses the hold status.

Answer

Set the vendor's Default invoice type to Credit note, then change it back after posting.

Answer

Delete the vendor and recreate it without a hold status.

Question 16

A new accounts payable clerk must record a vendor invoice that is not tied to a purchase order. The clerk needs the invoice to be available for a payment proposal in the next payment run. Which journal type should the clerk use to enter the invoice?

Accepted Answer

Vendor invoice journal. The vendor invoice journal is the correct entry point for a non-PO vendor invoice because it immediately posts to the vendor balance and creates an open payable. Only posted, open vendor transactions are considered by the payment proposal. The invoice register holds invoices before approval, so it would not make the invoice available in time.

Answer

General journal

Answer

Invoice register journal

Answer

Vendor disbursement journal

Question 17

A Dynamics 365 Finance user needs to transfer budget amounts from one department to another within the same fiscal year. The organization uses budget register entries for all budget adjustments. Which budget code should the user select to record this transfer?

Accepted Answer

Transfer. A budget transfer moves budget amounts from one department to another without changing the total budget. The Transfer budget code is specifically intended for this purpose. Original budget is for initial setup, Revision changes total budget, and Encumbrance reserves funds for commitments. Therefore, Transfer is the correct budget code for this scenario.

Answer

Encumbrance

Answer

Revision

Answer

Original budget

Question 18

A company acquires a new piece of machinery and wants to include the freight and installation costs in the asset's acquisition cost. The invoice for the machinery has been posted, and the freight and installation costs are on a separate vendor invoice. Which transaction type should be used to add these additional costs to the fixed asset?

Accepted Answer

Acquisition adjustment. Acquisition adjustment is designed to add costs to an existing fixed asset after the initial acquisition. Freight and installation costs are capitalizable and should be included in the asset's acquisition cost. By using acquisition adjustment, the additional costs are added to the asset's value and depreciated over its remaining useful life, ensuring accurate financial reporting.

Answer

Acquisition

Answer

Depreciation adjustment

Answer

Revaluation

Question 19

A company is reviewing its fixed asset depreciation setup in Dynamics 365 Finance before year-end close. The controller asks the functional consultant to identify which TWO statements accurately describe how depreciation conventions interact with depreciation methods and how they affect the first and last periods of an asset's life. (Choose two.)

Accepted Answer

The Mid quarter convention applies a half-quarter of depreciation in the quarter the asset is placed in service, with the remaining half applied in the quarter of disposal or retirement.. Depreciation conventions control first- and last-period proration and are independent of the depreciation method, allowing combinations such as Straight line with Half year or Reducing balance with Mid quarter. The Mid quarter convention applies half a quarter in the acquisition quarter and the remainder in the disposal quarter. Conventions apply to all acquisition sources and are not auto-recalculated when changed.

Answer

When you change the depreciation convention on an existing asset book, the system automatically recalculates prior-period depreciation and posts adjusting entries.

Answer

Depreciation conventions only apply to assets acquired through the purchase acquisition type, not to assets created through projects or inventory transfers.

Answer

The Full month convention prorates depreciation based on the exact number of days the asset was in service during the first and last months.

Question 20

A user in the Accounts payable department is trying to post an invoice, but the system displays an error that the accounting date is not in an open period. The user has confirmed that the invoice date is within the current month. What is the most likely cause of this error?

Accepted Answer

The ledger calendar for the current month is not set to an open period for the user's legal entity.. The error occurs because the accounting date falls in a period that is not open for posting. The ledger calendar controls which periods are open or closed for each legal entity. Even if the invoice date is in the current month, the accounting date might be set to a different date that falls in a closed period, or the period itself might be on hold. Checking and opening the period in the ledger calendar resolves the issue.

Answer

The vendor invoice journal name is not configured to allow posting to the current period.

Answer

The user does not have permission to post in the current period.

Answer

The invoice date is in a different fiscal year than the accounting date.