The correct answer is to recreate the transactions using the intercompany module and delete the original orders. This is necessary because the intercompany module in Dynamics 365 Finance is built to automatically generate matching entries in both legal entities and tag them for elimination during consolidation, whereas separate purchase and sales orders lack the internal flags that intercompany elimination rules require to identify and remove the intracompany trade. On the Microsoft Dynamics 365 Fundamentals ERP MB-920 exam, this scenario tests your understanding of how the elimination process depends on proper transaction setup, not just on the elimination rules themselves—a common trap is assuming any posted transaction can be eliminated, but only intercompany module transactions carry the necessary metadata. To remember this, think of the intercompany module as the only bridge that connects two entities for elimination; if you build separate bridges (orders), the elimination engine cannot see the connection.
MB-920 Describe Dynamics 365 Finance Practice Question
This MB-920 practice question tests your understanding of describe dynamics 365 finance. Read the scenario carefully and evaluate each option against the stated constraints before committing to an answer. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. 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.
You are the Dynamics 365 Finance administrator for a manufacturing company with multiple legal entities. The company uses intercompany transactions between Entity A (US) and Entity B (Germany). Entity A sells raw materials to Entity B. The transactions must be recorded in both entities' ledgers, and the intracompany trade must be eliminated during consolidation. Recently, the accounting team reported that intercompany transactions are not being eliminated correctly. Upon investigation, you find that the intercompany transactions were posted using separate purchase orders and sales orders, not through the intercompany module. The elimination process uses intercompany eliminations rules. What should you do to ensure proper elimination?
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Recreate the transactions using the intercompany module and delete the original orders.
Option A is correct because the intercompany module in Dynamics 365 Finance is specifically designed to automatically generate matching transactions in both legal entities and to flag those transactions for elimination during consolidation. By recreating the transactions through the intercompany module, you ensure that the intercompany eliminations rules can correctly identify and eliminate the intercompany trade. Deleting the original orders removes the manually created purchase and sales orders that were not linked to the elimination process.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
✓
Recreate the transactions using the intercompany module and delete the original orders.
Why this is correct
Ensures automatic matching and elimination.
Related concept
Read the scenario before looking for a memorised answer.
✗
Reverse the existing transactions and repost them with the same method.
Why it's wrong here
This repeats the same issue.
✗
Create manual elimination journal entries to correct the balances.
Why it's wrong here
Manual entries are not sustainable and may not match.
✗
Adjust the elimination rules to match the existing transactions.
Why it's wrong here
Elimination rules require matching entries from the intercompany module.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates may think manual journal entries or adjusting elimination rules can fix the issue, but the core requirement is that intercompany transactions must be created through the intercompany module to be automatically eliminated during consolidation.
Detailed technical explanation
How to think about this question
The intercompany module in Dynamics 365 Finance uses a dedicated intercompany setup where each legal entity is defined as a trading partner, and transactions are created with a common intercompany ID that links the purchase order in one entity to the sales order in the other. During consolidation, the elimination rules use this intercompany ID to automatically generate elimination entries that offset the intercompany revenue, cost, and receivable/payable balances. Without this ID, the elimination process cannot match transactions across entities, even if the amounts are identical.
KKey Concepts to Remember
Read the scenario before looking for a memorised answer.
Find the constraint that changes the correct option.
Eliminate answers that are true in general but not in this case.
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
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
How this comes up in practice
A cloud solutions architect for a retail company is evaluating services for a new workload. The correct answer here reflects best practice for the specific scenario described — not a general cloud recommendation. Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option. Cloud exam questions reward reading the constraint carefully: the same technology can be right or wrong depending on the use case.
What to study next
Got this wrong? Here's your next step.
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
Describe Dynamics 365 Finance — This question tests Describe Dynamics 365 Finance — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: Recreate the transactions using the intercompany module and delete the original orders. — Option A is correct because the intercompany module in Dynamics 365 Finance is specifically designed to automatically generate matching transactions in both legal entities and to flag those transactions for elimination during consolidation. By recreating the transactions through the intercompany module, you ensure that the intercompany eliminations rules can correctly identify and eliminate the intercompany trade. Deleting the original orders removes the manually created purchase and sales orders that were not linked to the elimination process.
What should I do if I get this MB-920 question wrong?
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
What is the key concept behind this question?
Read the scenario before looking for a memorised answer.
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