MB-310 Manage Budgeting Practice Test 2 — 15 Questions

Question 1

A finance team is using budget planning in Microsoft Dynamics 365 Finance. They need to ensure that when a budget plan is approved, the amounts are automatically transferred to the budget register entries for the next fiscal year. Which configuration should they set up?

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

Accepted Answer

Set up a budget planning process that includes the 'Update budget register' step after the final approval.. To automatically transfer approved budget plan amounts to budget register entries, you must configure the budget planning process to include the 'Update budget register' step. This step is executed after the final approval stage and creates budget register entries for the specified budget model and fiscal year. This ensures that the approved budget becomes effective for budget control and reporting.

Answer

Create a budget planning stage with an allocation that posts to the budget register.

Answer

Enable the 'Auto-post to budget register' option on the budget plan scenario.

Answer

Configure the budget plan workflow to include a task that generates budget register entries upon approval.

Question 2

A large organization uses budget control with a budget model that has a workflow for budget register entries. A budget manager creates a budget register entry to increase the budget for a department. The entry is submitted to workflow but not yet approved. What happens if a purchase order for that department is submitted for budget check?

Accepted Answer

The purchase order is blocked because the budget increase is not yet approved and posted.. Budget control uses posted budget amounts to determine available budget. A budget register entry that is still in workflow has not updated the budget balances, so it cannot be used to cover new expenditures. If the purchase order would exceed the currently posted budget, it will be blocked. This ensures that only approved budgets are spent.

Answer

The purchase order is allowed because the budget register entry is in workflow and will eventually be approved.

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The purchase order is allowed but a warning is issued that the budget increase is pending.

Answer

The purchase order is blocked until the budget register entry is approved, regardless of remaining budget.

Question 3

A legal firm uses Microsoft Dynamics 365 Finance to manage its annual operating budget. The finance manager wants to prevent any purchase order from being processed if it would cause the legal department's travel expense budget to be exceeded. The manager also needs the ability to temporarily allow an over-budget purchase order for a high-priority case without changing the budget amount. Which budget control configuration should you implement?

Accepted Answer

Configure budget control with a budget group that includes the Legal department, and set the budget control rule to use the 'Stop' budget check result. Grant the budget manager the ability to override the check by adjusting the budget or using budget control exceptions.. The correct configuration uses budget control with a Stop result to prevent over-budget purchase orders, combined with the ability to override via budget control exceptions or budget adjustments. This enforces the budget limit while allowing temporary exceptions for high-priority cases without permanently changing the budget amount. The other options either fail to block transactions or require permanent budget changes.

Answer

Set up budget control with a budget group that includes the Legal department, and configure the budget control rule to use the 'Warning' budget check result for over-budget transactions.

Answer

Enable budget control with a budget group that includes all departments, and set the budget control rule to use the 'Stop' result. Provide the budget manager with the 'Budget override' permission to bypass the check.

Answer

Create a budget transfer to move funds from another department's budget to the Legal department's travel expense budget, and enable budget control with the 'Stop' result.

Question 4

You are a functional consultant at Fabrikam, which uses Microsoft Dynamics 365 Finance. The controller wants to reserve a portion of the annual budget for unplanned marketing opportunities. The reserved amount must be reflected in the budget register without being available for department spending, and it must be tied to the Marketing department and the Marketing purpose. Which budget register entry type should you use to record this reservation?

Accepted Answer

Budget reservation. Budget reservations are used to set aside budget funds without authorizing spending. They reduce the available budget balance while preserving the total budget amount. Because the controller needs a department- and purpose-specific reservation that cannot be spent, the budget reservation entry type is the only appropriate choice among the options.

Answer

Pre-encumbrance

Answer

Original budget

Answer

Encumbrance

Question 5

A retail organization is implementing budget control in Microsoft Dynamics 365 Finance. The budget manager wants to ensure that all purchase requisitions are checked against the available budget before they are approved. The organization also wants to allow certain users to post transactions that exceed the budget without requiring a budget transfer, but only for a limited time. What should you configure?

Accepted Answer

Configure budget control with a 'Stop' result for purchase requisitions, and set up budget control exceptions for specific users with an expiration date.. The correct approach is to enforce budget control with a 'Stop' result and use budget control exceptions with expiration dates for specific users. This ensures that purchase requisitions are checked against the budget and blocked if over budget, while allowing designated users to temporarily exceed the budget without a budget transfer. This provides both control and flexibility as required.

Answer

Create a budget transfer to increase the budget for the users who need to exceed it, and enable budget control with a 'Stop' result.

Answer

Set up budget control to use the 'Stop' result for purchase requisitions, and grant the users the 'Budget override' permission.

Answer

Enable budget control and set the budget check result to 'Warning' for purchase requisitions.

Question 6

A purchasing manager at Fabrikam creates a purchase requisition for $60,000 against a budget that has only $45,000 remaining. Budget control is configured with a threshold of 90% and an over-budget permission of 10%. What happens when the requisition is submitted to workflow?

Accepted Answer

The requisition fails budget check and the workflow is blocked until the budget is increased or the transaction amount is reduced.. The requisition exceeds the remaining budget by more than the allowed over-budget permission, so budget control fails the check and blocks the workflow. The threshold only triggers warnings, and the over-budget permission is a hard limit that, when exceeded, prevents posting. The correct resolution is to increase the budget or reduce the requisition amount.

Answer

The requisition is automatically routed to the budget manager for approval, and upon approval, budget control is bypassed.

Answer

The requisition triggers a warning but still passes, because the 90% threshold acts as a soft limit that only notifies the budget manager.

Answer

The requisition passes budget check and the workflow continues, because the over-budget permission of 10% allows exceeding the remaining budget.

Question 7

A Dynamics 365 Finance consultant is setting up budget control for a new fiscal year. The organization wants to allow a specific group of power users to post transactions that exceed the remaining budget without being blocked, while all other users must be prevented from overspending. The finance team also requires that any overspending by the power users is still recorded and visible in budget reporting. What should the consultant configure?

Accepted Answer

Set up a budget control configuration that allows over-budget posting for a specific user group, and enable the 'Record over-budget' option so the overage is tracked.. The requirement is to allow a specific set of users to post over-budget while still capturing the overspending for reporting. Budget control in Dynamics 365 Finance supports user group exceptions that permit over-budget posting, and the record over-budget option ensures the overage is tracked. This combination provides the necessary flexibility without sacrificing visibility.

Answer

Create a budget control rule that applies to all users, and assign the power users to a separate budget group that is excluded from budget checking.

Answer

Create a budget transfer to increase the budget for the power users' department, and then apply budget control to all users without exceptions.

Answer

Configure budget control to use a budget manager, and set up an override permission for the power users so they can approve their own over-budget transactions.

Question 8

A multinational corporation uses Microsoft Dynamics 365 Finance to manage budgets across multiple legal entities. The finance director wants to consolidate budget data from all entities into a single budget plan for reporting purposes. The corporation also needs to ensure that budget transfers between entities are recorded and auditable. Which feature should you use to achieve these goals?

Accepted Answer

Budget planning with a multi-company budget plan and the 'Aggregate' allocation method.. The correct feature is budget planning with a multi-company budget plan and the 'Aggregate' allocation method. This allows the corporation to consolidate budget data from multiple legal entities into one plan for reporting, and it supports auditability of budget transfers through workflow and history. Other options do not provide consolidation or the required audit capabilities for cross-entity budget transfers.

Answer

Budget planning with the 'Copy from budget plan' allocation method across legal entities.

Answer

Budget control configuration with cross-company budget checking enabled.

Answer

Budget register entries with the 'Transfer' budget type and intercompany accounting enabled.

Question 9

A Contoso finance team is setting up budget planning in Microsoft Dynamics 365 Finance. They need to ensure that budget plan lines can be created from multiple sources, including historical actuals and other budget plans, and that the planning process includes an approval workflow. Which two actions must the team perform to meet these requirements? (Choose two.)

Accepted Answer

Configure budget planning stages and associate a workflow to the stages.. To create budget plan lines from historical actuals and other budget plans, the team must configure budget plan templates with the necessary dimensions and measures. To include an approval workflow, they must set up budget planning stages and associate a workflow. These two actions together satisfy both requirements. Budget control and budget codes are not relevant to budget planning, and column configuration is part of template setup.

Answer

Configure budget planning columns to include actuals and budget plan data.

Answer

Set up budget codes for the budget planning process.

Answer

Enable budget control for the budget planning process.

Question 10

A finance team at Adventure Works is configuring budget control for a new fiscal year. They need to ensure that budget checking applies to purchase orders but not to vendor invoices, because invoices are already checked at the purchase order stage. Which configuration should they implement?

Accepted Answer

In the budget control configuration, define the budget control rule to include purchase orders and exclude vendor invoices by using the 'Select source documents' and 'Assign budget models' settings.. Budget control is applied based on the source documents selected in the budget control configuration. By including only purchase orders and excluding vendor invoices, the team ensures that budget checks occur at the purchase order stage but not again at the invoice stage. This prevents duplicate checking and aligns with the business requirement.

Answer

On the vendor invoice form, set the 'Budget check' field to 'No' for all invoices, and enable budget checking only on the purchase order form.

Answer

In the budget control configuration, set the budget check option for vendor invoices to 'Do not check' and for purchase orders to 'Check'.

Answer

Use the budget control configuration to set the 'Default budget check' to 'Purchase order only' and then manually override each vendor invoice.

Question 11

A company uses budget control in Microsoft Dynamics 365 Finance. The budget manager reports that a purchase order for $15,000 was posted even though the available budget for the combination of Department and CostCenter was only $10,000. The budget control rule for this combination is configured with an over-budget permission of Deny and a threshold of $5,000. What is the most likely reason the purchase order was not blocked?

Accepted Answer

The purchase order amount did not exceed the threshold for budget checking.. The threshold in a budget control rule specifies the minimum over-budget amount that triggers a check. If the over-budget amount is $5,000 and the threshold is $5,000, the check may not trigger because the rule might require the overage to exceed the threshold. This subtle behavior explains why the purchase order posted despite exceeding available budget. Activation status and timing are less likely given the configured threshold.

Answer

The purchase order was posted before the budget was finalized.

Answer

The budget control configuration was not activated for the legal entity.

Answer

The budget control rule was not activated.

Question 12

A budget manager needs to transfer budget amounts between two main accounts within the same budget model and dimension set. The transfer must be reflected immediately in budget balances without creating a budget register entry that requires approval. Which budget register entry type should the manager use?

Accepted Answer

Transfer. The Transfer budget register entry type is the correct choice for moving budget amounts between accounts within the same budget model. It creates a single entry that reduces the source account and increases the destination account, ensuring both balances are updated immediately. This is the standard method for budget reallocation without changing the total budget. Other entry types serve different purposes such as initial budget, adjustments, or commitments.

Answer

Original budget

Answer

Revision

Answer

Encumbrance

Question 13

A budget manager at Northwind Traders is setting up budget planning for the next fiscal year. They need to ensure that budget plan lines can be created for multiple scenarios and that the final approved budget can be transferred to the general ledger. Which two actions must be completed? (Choose two.)

Accepted Answer

Configure budget planning stages and workflows to define the review and approval process.. To support multiple scenarios and transfer approved budgets to the general ledger, budget planning stages and workflows must be configured to manage the approval process, and budget planning scenarios must be set up to allow multiple versions. These two actions are fundamental to the budget planning lifecycle and are required for the described functionality.

Answer

Create a budget model and assign it to the budget planning configuration.

Answer

Configure budget control to enable budget checking for budget plan lines.

Answer

Define budget codes and assign them to the budget planning process.

Question 14

A financial controller at Litware, Inc. is reviewing budget control performance. They notice that budget checks are taking a long time during peak transaction entry. They need to improve performance without disabling budget control. What should they do?

Accepted Answer

Reduce the number of budget control rules by consolidating budget dimensions.. Consolidating budget dimensions reduces the number of budget control rules and simplifies each check, leading to faster performance. Budget control remains active, but the system evaluates fewer combinations. Other options either do not exist, do not affect performance, or would compromise the real-time nature of budget checking.

Answer

Enable the 'Use summarization' option in the budget control configuration to aggregate budget balances.

Answer

Increase the budget control threshold to 100% to reduce the number of warnings.

Answer

Schedule budget checks to run only during off-peak hours using batch processing.

Question 15

A public sector organization uses Dynamics 365 Finance to manage budgets. They need to track both original budget and current budget amounts, and they want to ensure that budget control uses the current budget for availability checks. Which budget model configuration should they use?

Accepted Answer

Create two budget models: one for original budget and one for current budget, and configure budget control to use the current budget model.. To track original and current budget separately, you should create two budget models. The original budget model holds the initially approved budget, while the current budget model reflects all revisions and transfers. Budget control can then be configured to use the current budget model for availability checks. This separation is essential for reporting and compliance in public sector organizations.

Answer

Create a single budget model and use the 'Original budget' entry type for all budget updates.

Answer

Use a single budget model and create a budget transfer to move amounts from original to current budget.

Answer

Use a single budget model and configure budget control to use the 'Revision' entry type.