- A
Microsoft Entra ID Connect (Password Hash Synchronization)
PHS syncs password hashes to Microsoft Entra ID, allowing users to authenticate with their on-premises credentials for cloud apps. It is simple and requires no additional federation infrastructure.
- B
Microsoft Entra ID Application Proxy
Why wrong: Application Proxy provides secure remote access to on-premises web applications, but does not integrate on-premises AD with Microsoft Entra ID for SSO.
- C
Microsoft Entra ID B2B
Why wrong: Microsoft Entra ID B2B is for collaborating with external partners, not for integrating on-premises identity.
- D
Microsoft Entra ID Domain Services
Why wrong: Microsoft Entra ID DS provides domain services for Azure VMs but does not sync passwords from on-premises AD for SSO to cloud apps.
Quick Answer
Password Hash Synchronization (PHS) is the correct choice because it synchronizes password hashes from on-premises Active Directory to Microsoft Entra ID, enabling users to use the same password for both on-premises and cloud resources without requiring any additional federation infrastructure. This feature directly addresses the need to sync on-prem passwords to cloud for SSO without federation, as it avoids deploying AD FS or other federation servers while still providing seamless single sign-on to cloud applications. On the AZ-305 exam, this scenario tests your ability to differentiate between identity synchronization methods—PHS, Pass-through Authentication, and federation—where the key trap is choosing federation when the question explicitly states “no additional infrastructure.” Remember that PHS is the simplest, zero-infrastructure approach for password-based SSO, and the exam often pairs it with Seamless SSO for a complete silent sign-on experience. Memory tip: PHS = “Password Hash Sync” = “Passwords, Hashed, Simple.”
AZ-305 Practice Question: Design identity, governance, and monitoring solutions
This AZ-305 practice question tests your understanding of design identity, governance, and monitoring solutions. Read the scenario carefully and evaluate each option against the stated constraints before committing to an answer. A key principle to apply: pHS syncs a hash of the password, not the password itself.. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
A company uses Microsoft Entra ID (Microsoft Entra ID). They want to integrate their on-premises Active Directory with Microsoft Entra ID to enable single sign-on (SSO) for cloud applications. Users should be able to use the same password for on-premises resources and cloud applications. The company has a large on-premises user base and wants to avoid additional infrastructure for federation. Which Microsoft Entra ID feature should they implement?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
Microsoft Entra ID Connect (Password Hash Synchronization)
Password Hash Synchronization (PHS) is the correct choice because it synchronizes password hashes from on-premises Active Directory to Microsoft Entra ID, enabling users to use the same password for both on-premises and cloud resources without requiring any additional federation infrastructure. This meets the requirement for SSO to cloud applications while avoiding the complexity and cost of deploying Active Directory Federation Services (AD FS) or other federation servers.
Key principle: PHS syncs a hash of the password, not the password itself.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✓
Microsoft Entra ID Connect (Password Hash Synchronization)
Why this is correct
PHS syncs password hashes to Microsoft Entra ID, allowing users to authenticate with their on-premises credentials for cloud apps. It is simple and requires no additional federation infrastructure.
Related concept
PHS syncs a hash of the password, not the password itself.
- ✗
Microsoft Entra ID Application Proxy
Why it's wrong here
Application Proxy provides secure remote access to on-premises web applications, but does not integrate on-premises AD with Microsoft Entra ID for SSO.
- ✗
Microsoft Entra ID B2B
Why it's wrong here
Microsoft Entra ID B2B is for collaborating with external partners, not for integrating on-premises identity.
- ✗
Microsoft Entra ID Domain Services
Why it's wrong here
Microsoft Entra ID DS provides domain services for Azure VMs but does not sync passwords from on-premises AD for SSO to cloud apps.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often confuse federation (e.g., AD FS) as the only way to achieve SSO with password reuse, but Password Hash Synchronization provides a simpler, infrastructure-free alternative that still meets the requirement.
Detailed technical explanation
How to think about this question
Password Hash Synchronization works by hashing the on-premises password using the MD4 algorithm (via the NT hash) and then synchronizing that hash to Entra ID over an encrypted HTTPS channel. When a user signs in to a cloud application, Entra ID compares the provided password hash against the stored hash, allowing authentication without any on-premises infrastructure involvement. In real-world scenarios, PHS is often combined with Seamless SSO to provide a transparent sign-in experience on domain-joined devices, eliminating password prompts entirely.
KKey Concepts to Remember
- PHS syncs a hash of the password, not the password itself.
- PHS provides single sign-on (SSO) for cloud applications.
- PHS requires no additional federation infrastructure (e.g., ADFS).
- PHS is the simplest method for integrating on-premises AD with Microsoft Entra ID.
TExam Day Tips
- Watch for words such as best, first, most likely and least administrative effort.
- Review why wrong options are wrong, not only why the correct option is correct.
Key takeaway
PHS syncs a hash of the password, not the password itself.
Real-world example
How this comes up in practice
A startup's cloud architect reviews their monthly bill and notices costs are higher than expected for a long-running batch job. Switching from on-demand instances to Reserved Instances — or using Spot/Preemptible VMs — can reduce compute costs by up to 72 %. Questions like this test whether you understand the tradeoffs between commitment, flexibility, and cost across cloud pricing models.
What to study next
Got this wrong? Here's your next step.
Review pHS syncs a hash of the password, not the password itself., then practise related AZ-305 questions on the same topic to reinforce the concept.
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FAQ
Questions learners often ask
What does this AZ-305 question test?
Design identity, governance, and monitoring solutions — This question tests Design identity, governance, and monitoring solutions — PHS syncs a hash of the password, not the password itself..
What is the correct answer to this question?
The correct answer is: Microsoft Entra ID Connect (Password Hash Synchronization) — Password Hash Synchronization (PHS) is the correct choice because it synchronizes password hashes from on-premises Active Directory to Microsoft Entra ID, enabling users to use the same password for both on-premises and cloud resources without requiring any additional federation infrastructure. This meets the requirement for SSO to cloud applications while avoiding the complexity and cost of deploying Active Directory Federation Services (AD FS) or other federation servers.
What should I do if I get this AZ-305 question wrong?
Review pHS syncs a hash of the password, not the password itself., then practise related AZ-305 questions on the same topic to reinforce the concept.
What is the key concept behind this question?
PHS syncs a hash of the password, not the password itself.
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Last reviewed: Jun 11, 2026
This AZ-305 practice question is part of Courseiva's free Microsoft certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the AZ-305 exam.
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