MB-310

Microsoft Dynamics 365 Finance Functional Consultant

Version 9.0

Topic 1, Set up and configure financial management

QUESTION NO: 1

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

You are configuring the year-end setup in Dynamics 365 Finance.

You need to configure the year-end setup to meet the following requirements:

• The accounting adjustments that are received in the first quarter must be able to be
posted into the previous year’s Period 13.
• The fiscal year closing can be run again, but only the most recent closing entry will
remain in the transactions.
• All dimensions from profit and loss must carry over into the retained earnings.
• All future and previous periods must have an On Hold status.

Solution:

• Configure General ledger parameters.

o Set the Delete close of year transactions option to Yes.
o Set the Create closing transactions during transfer option to Yes.
o Set the Fiscal year status to permanently closed option to No.
• Define the Year-end close template.
o Designate a retained earnings main account for each legal entity.
o Set the Financial dimensions will be used on the Opening transactions option
to No.
 o Set the Transfer profit and loss dimensions option to Close All.
• Set all prior and future Ledger periods to a status of On Hold.

Does the solution meet the goal?

A. Yes
B. No

Answer: A

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/general-
ledger/year-end-close

QUESTION NO: 2

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

You are configuring the year-end setup in Dynamics 365 Finance.

You need to configure the year-end setup to meet the following requirements:

• The accounting adjustments that are received in the first quarter must be able to be
posted into the previous year’s Period 13.
• The fiscal year closing can be run again, but only the most recent closing entry will
remain in the transactions.
• All dimensions from profit and loss must carry over into the retained earnings.
• All future and previous periods must have an On Hold status.

Solution:

• Configure General ledger parameters.

o Set the Delete close of year transactions option to Yes.
o Set the Create closing transactions during transfer option to Yes.
o Set the Fiscal year status to permanently closed option to Yes.
• Define the Year-end close template.
 o Designate a retained earnings main account for each legal entity.
o Set the Financial dimensions will be used on the Opening transactions option
to Yes.
o Set the Transfer profit and loss dimensions to Close All.
• Set all prior and future Ledger periods to a status of On Hold.

Does the solution meet the goal?

A. Yes
B. No

Answer: B

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/general-
ledger/year-end-close

QUESTION NO: 3

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

You are configuring the year-end setup in Dynamics 365 Finance.

You need to configure the year-end setup to meet the following requirements:

• The accounting adjustments that are received in the first quarter must be able to be
posted into the previous year’s Period 13.
• The fiscal year closing can be run again, but only the most recent closing entry will
remain in the transactions.
• All dimensions from profit and loss must carry over into the retained earnings.
• All future and previous periods must have an On Hold status.

Solution:

• Configure General ledger parameters.

o Set the Delete close of year transactions option to No.
 o Set the Create closing transactions during transfer option to No.
o Set the Fiscal year status to permanently closed option to No.
• Define the Year-end close template.
o Designate a retained earnings main account for each legal entity.
o Set the Financial dimensions will be used on the Opening transactions option
to No.
o Set the Transfer profit and loss dimensions to Close All.
• Set all prior and future Ledger periods to a status of On Hold.

Does the solution meet the goal?

A. Yes
B. No

Answer: B

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/general-
ledger/year-end-close

QUESTION NO: 4 HOTSPOT

You are implementing a Dynamics 365 Finance general ledger module for a client that has
multiple legal entities.

The client has the following requirements:

• Configure automatic creation of due to/due from transactions based on when

LegalEntityA transacts with LegalEntityB.
• Automatically split the dollar amount in half between DimensionA and DimensionB
when the journal is posted.
• Set up fixed or variable allocations, and then review the allocations in a journal before
posting.
• Automatically post year-end results to account 30016 during year-end close.

You need to configure the system.

Which system capability should you configure? To answer, select the appropriate
configuration in the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="337" x2="612" y1="121" y2="140" ss="0" a="0" /><m x1="337"
x2="610" y1="257" y2="276" ss="0" a="0" /><m x1="337" x2="612" y1="371" y2="391"
ss="0" a="0" /><m x1="337" x2="611" y1="508" y2="525" ss="0" a="0" /></map>
Explanation:
QUESTION NO: 5

A company is preparing to complete a year-end close process.

You need to configure the Dynamics 365 Finance general ledger module.

Which three configurations actions should you perform? Each correct answer presents part of
the solution.

NOTE: Each correct selection is worth one point.

A. Configure the Fiscal year close parameters

B. Configure the ledger calendar for the new fiscal year
C. Set up the year end close template
D. Validate the main account type
E. Create the next fiscal year

Answer: A, D, E
Explanation:
This question is asking about configuring the system. Answers A (Configure the Fiscal year
close parameters), D (Validate the main account type) and E (Create the next fiscal year) are
required to configure the system.
The next step after configuring the system would be Answer C (Set up the year end close
template).

After the system is configured, the year-end close process can be run. On the Year-end
close page, a template can be defined for the group of legal entities for which the year-end
close process will be run. The template will be reused at each year-end close, but can be
modified if your organization changes.

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/general-
ledger/year-end-close

QUESTION NO: 6

A client has unique accounting needs that sometimes require posting definitions.

You need to implement posting definitions.

In which situation should you implement posting definitions?

A. when financial dimensions need to default from the vendor record onto an invoice
B. when only certain dimensions are allowed to post with certain main account combinations
C. when creating multiple balanced ledger entries based on transaction types or accounts
D. when the system needs to automatically post a transaction to the accounts receivable
account on invoice posting

Answer: D

QUESTION NO: 7

An organization is setting up a cost accounting.

You need to set up fiscal calendars for Dynamics 365 Finance.

What are three uses for fiscal calendars? Each correct answer presents a complete solution.
NOTE: Each correct selection is worth one point.

A. standard work hours

B. financial transactions
C. fixed asset depreciation
D. budget cycles
E. shift work hours

Answer: B, C, D

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/budgeting/fiscal-
calendars-fiscal-years-periods

QUESTION NO: 8

You are configuring automatic bank reconciliation functionality for a company that has
multiple bank accounts. The company wants to import their bank statements.

You need to import electronic bank statements to reconcile the bank accounts.

Which three actions can you perform? Each correct answer presents a complete solution.

NOTE: Each correct selection is worth one point.

A. Select all the bank accounts for the bank statement files, and then upload all files
B. Select Account reconciliation on the bank account form
C. Import bank statements from the Data management workspace
D. Navigate to Import statement on the Bank Statements page of Cash and Bank
Management
E. Select Import statement for multiple bank accounts in all legal entities, and then
upload a zip file

Answer: B, D, E

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/cash-bank-
management/reconcile-bank-statements-advanced-bank-reconciliation

QUESTION NO: 9
A company plans to create a new allocation rule for electric utilities expenses.

The allocation rule must meet the following requirements:

• Distribute overhead utility expense to each department.

• Define how and in what proportion the source amounts must be distributed on various
destination lines.

You need to configure the allocation rule.

Which allocation method should you use?

A. Distribute the source document amount equally

B. Fixed weight
C. Equally
D. Basis

Answer: D

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/general-
ledger/ledger-allocation-rules

QUESTION NO: 10 HOTSPOT

A food manufacturer uses commodities such as beans, corn, and chili peppers as raw
materials. The prices of the commodities fluctuate frequently. The manufacturer wants to use
cost versions to simulate these fluctuations.

You need to set up cost versions and prices to accomplish the manufacturer’s goal.

For which purpose should you use each costing type? To answer, select the appropriate
options in the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="214" x2="558" y1="151" y2="172" ss="0" a="0" /><m x1="213"
x2="558" y1="214" y2="236" ss="0" a="0" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/supply-chain/cost-
management/costing-versions

QUESTION NO: 11 HOTSPOT

A rental service company hires you to configure their system to implement accrual schemes.
You need to configure the accrual schemes for the company for both rentals and associated
expenses.

Which configuration and transaction options should you use? To answer, select the
appropriate options in the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="272" x2="616" y1="157" y2="178" ss="0" a="0" /><m x1="272"
x2="615" y1="219" y2="242" ss="0" a="0" /></map>
Explanation:
QUESTION NO: 12

A company provides employee life insurance to all full-time employees. Employee life
insurance policies are paid twice a year to the insurance company.

Transactions for current employees must be recognized in the general ledger twice a month
with an employee’s pay. Transactions for new employees must be recognized in the general
ledger based upon the employee’s first pay date.

You need to configure accrual schemes for the new fiscal year.

Which two configurations should you use? Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. For new employees, use a Credit accrual scheme. In the ledger accrual, set the offset to the
first day of the fiscal year.
B. For current employees, use a Credit accrual scheme. In the ledger accrual, set the offset to
the employee’s first pay date.
C. For new employees, use a Debit accrual scheme. In the ledger accrual, set the offset to the
employee’s first pay date.
D. For current employees, use a Debit accrual scheme. In the ledger accrual, set the offset to
the first day of the fiscal year.

Answer: B, D

QUESTION NO: 13 HOTSPOT

A client plans to use the cost accounting module in Dynamics 365 Finance.

You need to associate the correct definitions to the correct cost accounting concepts.

Which terms match the definitions? To answer, select the appropriate configuration in the
answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="454" x2="618" y1="174" y2="196" ss="0" a="0" /><m x1="454"
x2="619" y1="234" y2="254" ss="0" a="0" /><m x1="453" x2="618" y1="362" y2="383"
ss="0" a="0" /><m x1="452" x2="615" y1="475" y2="496" ss="0" a="0" /><m x1="449"
x2="615" y1="627" y2="647" ss="0" a="0" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/cost-
accounting/terms-cost-accounting

QUESTION NO: 14

An organization uses Dynamics 365 Finance.

Several posted journal entries contain invalid main account and dimension combinations.
This leads to incorrect financial reporting.
You need to prevent these invalid combinations.

What should you do?

A. Configure the account structure to specify which financial dimensions are valid for which
main accounts.
B. Train users to select the Validate button in the current journal configuration so that the
correct account and dimension combination is used.
C. Configure financial dimension sets to limit which financial dimensions are valid for which
main accounts.
D. Associate the correct main accounts to that financial dimension on the financial dimension
setup form.

Answer: A

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/general-
ledger/configure-account-structures

QUESTION NO: 15 HOTSPOT

A client plans to use Dynamics 365 Finance for year-end 1099 reporting in the United States.

You are viewing a vendor master data record on the 1099 FastTab.
Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="334" x2="609" y1="147" y2="169" ss="0" a="0" /><m x1="334"
x2="608" y1="245" y2="267" ss="0" a="0" /></map>
Explanation:

QUESTION NO: 16

A legal entity has locations and customers in multiple states within the United States.
You need to ensure that taxable customers are charged sales tax for taxable items in their
delivery location.

Which three settings must you configure? Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. the Sales tax group on the Customer record

B. the Terms of delivery setup
C. the Item Sales tax group on the Item record
D. the Sales reporting codes
E. the Sales tax codes

Answer: A, B, E

QUESTION NO: 17

You are configuring Dynamics 365 Finance.

You need to implement posting definitions for all available transaction types.

For which type of transactions can you implement posting definitions?

A. Accounts payable, Accounts receivable, Bank, Budget, Payroll, and Purchasing

B. Accounts payable, Bank, Budget, Fixed assets, and Payroll
C. Accounts payable, Accounts receivable, Fixed assets, Payroll, and Purchasing
D. Accounts payable, Accounts receivable, Budget, and Fixed assets

Answer: A

QUESTION NO: 18 DRAG DROP

You need to set up a process of tracking, recording, and analyzing costs associated with the
products or activities of a nonmanufacturing organization.

You need to configure the prerequisite setup for the standard costing version for the current
period.

In which order should you perform the actions? To answer, move all actions from the list of
actions to the answer area and arrange them in the correct order.
Answer: <map><m x1="8" x2="326" y1="40" y2="82" ss="0" a="0" /><m x1="8" x2="325"
y1="89" y2="132" ss="0" a="0" /><m x1="9" x2="324" y1="141" y2="181" ss="0" a="0"
/><m x1="7" x2="324" y1="191" y2="234" ss="0" a="0" /><m x1="389" x2="741" y1="37"
y2="80" ss="1" a="0" /><m x1="390" x2="739" y1="85" y2="128" ss="1" a="0" /><m
x1="389" x2="738" y1="133" y2="176" ss="1" a="0" /><m x1="389" x2="737" y1="182"
y2="220" ss="1" a="0" /><c start="3" stop="0" /><c start="1" stop="1" /><c start="0"
stop="2" /><c start="2" stop="3" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/supply-chain/cost-
management/prerequisites-standard-costs

QUESTION NO: 19

A public sector company is configuring encumbrance for managing capital budgets.

The finance department needs to configure posting definitions for bank transactions.

You need to configure Dynamics 365 Finance for cash settlements.

What should you do?

A. Configure combined deposit amounts
B. Configure budget appropriations
C. Configure general ledger year-end close
D. Configure advanced ledger entries

Answer: A

QUESTION NO: 20 DRAG DROP

A retail company has outlets in multiple locations. Taxes vary depending on the location.

You need to configure the various components of the tax framework.

In which order should you perform the actions? To answer, move all actions from the list of
actions to the answer area and arrange them in the correct order.

Answer: <map><m x1="7" x2="325" y1="40" y2="83" ss="0" a="0" /><m x1="7" x2="324"
y1="89" y2="134" ss="0" a="0" /><m x1="6" x2="325" y1="140" y2="185" ss="0" a="0"
/><m x1="6" x2="323" y1="193" y2="232" ss="0" a="0" /><m x1="8" x2="322" y1="239"
y2="280" ss="0" a="0" /><m x1="395" x2="767" y1="37" y2="85" ss="1" a="0" /><m
x1="394" x2="766" y1="90" y2="137" ss="1" a="0" /><m x1="395" x2="765" y1="140"
y2="190" ss="1" a="0" /><m x1="396" x2="766" y1="196" y2="240" ss="1" a="0" /><m
x1="395" x2="764" y1="244" y2="284" ss="1" a="0" /><c start="0" stop="0" /><c start="3"
stop="1" /><c start="4" stop="2" /><c start="2" stop="3" /><c start="1" stop="4" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/general-
ledger/indirect-taxes-overview

QUESTION NO: 21 HOTSPOT

A client wants to ensure that transactions posted to the General Ledger have the correct
combination of account number and dimensions.

The Services Industry P&L Account Structure has the following information:

Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="334" x2="941" y1="216" y2="245" ss="0" a="0" /><m x1="332"
x2="938" y1="295" y2="325" ss="0" a="0" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/configure-account-
structures

QUESTION NO: 22 HOTSPOT

A rental service company with complex accrual requirements has accrual schemes set up in
its implementation.
You need to ensure that all transactions for the company use an accrual scheme.

Which actions should you perform? To answer, select the appropriate configuration in the
answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="263" x2="868" y1="169" y2="220" ss="0" a="0" /><m x1="261"
x2="868" y1="296" y2="344" ss="0" a="0" /></map>
Explanation:
QUESTION NO: 23 DRAG DROP

You are configuring a Dynamics 365 Finance environment for intercompany accounting. You
create the following legal entities:

• CompanyA
• CompanyB

You need to configure intercompany accounting for both legal entities.

Which three actions should you perform in sequence? To answer, move the appropriate
actions from the list of actions to the answer area and arrange them in the correct order.

NOTE: More than one order of answer choices is correct. You will receive credit for any of
the correct orders you select.

Answer: <map><m x1="9" x2="455" y1="44" y2="134" ss="0" a="0" /><m x1="9"
x2="456" y1="147" y2="235" ss="0" a="0" /><m x1="8" x2="456" y1="248" y2="338"
ss="0" a="0" /><m x1="7" x2="455" y1="351" y2="440" ss="0" a="0" /><m x1="7"
x2="456" y1="451" y2="541" ss="0" a="0" /><m x1="535" x2="1005" y1="46" y2="130"
ss="1" a="0" /><m x1="535" x2="1005" y1="135" y2="223" ss="1" a="0" /><m x1="536"
x2="1006" y1="230" y2="314" ss="1" a="0" /><c start="3" stop="0" /><c start="1"
stop="1" /><c start="2" stop="2" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/intercompany-
accounting-setup

QUESTION NO: 24

An organization plans to set up intercompany accounting between legal entities within the
organization.

Automatic transactions between legal entities must meet the following requirements:

• Provide systemwide integration and streamlining to save time.

• Minimize errors and create an audit trail with full visibility into business activities and
transaction histories within the legal entities.

You need to set up intercompany accounting and create pairs of legal entities that can transact
with each other, clearly defining the originating company and the destination company.

Which three actions should you perform? Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. Select intercompany journal names.

B. Configure intercompany accounting in both the originating entity and destination entity.
C. Create intercompany main accounts to use for the due to and due from accounting entries.
D. Define intercompany accounting setup by creating legal entity pairs defining originating
and destination companies.
E. Configure intercompany accounting in the destination entity only.

Answer: A, C, D

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/intercompany-
accounting-setup

QUESTION NO: 25 DRAG DROP

You are a controller in an organization. You are identifying cost drivers to see how changes
in business activities affect the bottom line of your organization. You need to assess cost
object performance to analyze actual versus budgeted cost and how resources are consumed.

You need to demonstrate your understanding of cost accounting terminology.

Which component maps to the cost accounting terminology?

To answer, drag the appropriate component to the correct cost accounting terminology. Each
source may be used once. You may need to drag the split bar between panes or scroll to view
content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="7" x2="397" y1="81" y2="123" ss="0" a="0" /><m x1="6"
x2="397" y1="130" y2="171" ss="0" a="0" /><m x1="8" x2="402" y1="182" y2="225"
ss="0" a="0" /><m x1="8" x2="399" y1="231" y2="274" ss="0" a="0" /><m x1="686"
x2="1080" y1="79" y2="124" ss="1" a="0" /><m x1="688" x2="1079" y1="130" y2="173"
ss="1" a="0" /><m x1="687" x2="1080" y1="182" y2="222" ss="1" a="0" /><m x1="687"
x2="1080" y1="232" y2="275" ss="1" a="0" /><c start="1" stop="0" /><c start="3"
stop="1" /><c start="2" stop="2" /><c start="0" stop="3" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/cost-accounting/terms-cost-
accounting

QUESTION NO: 26 SIMULATION

You are a functional consultant for Contoso Entertainment System USA (USMF).

You need to implement a quarterly accruals scheme for USMF. The accrual scheme settings
must match the settings of the monthly and annual accrual schemes.

To complete this task, sign in to the Dynamics 365 portal.

Answer: See explanation below.

Explanation:
Look at the monthly and annual accrual scheme settings. Create a quarterly accrual scheme
with the same settings by using the following instructions:

1. Go to Navigation pane > Modules > General ledger > Journal setup > Accrual
schemes.
2. Select New.
3. In the Accrual identification field, type a value.
4. In the Description of accrual scheme field, type a value.
5. In the Debit field, specify the desired values. The main account defined will replace
the debit main account on the journal voucher line and it will also be used for the
reversal of the deferral based on the ledger accrual transactions.
6. In the Credit field, specify the desired values. The main account defined will replace
the credit main account on the journal voucher line and it will also be used for the
reversal of the deferral based on the ledger accrual transactions.
7. In the Voucher field, select how you want the voucher determined when the
transactions are posted.
8. In the Description field, type a value to describe the transactions that will be posted.
9. In the Period frequency field, select how often the transactions should occur.
 10. In the Number of occurrences by period field, enter a number.
11. In the Post transactions field, select when the transactions should be posted, such
as Monthly.

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/tasks/create-accrual-
schemes

QUESTION NO: 27 SIMULATION

You are a functional consultant for Contoso Entertainment System USA (USMF).

USMF plans to implement a new manufacturing department that will be based in Australia.

You need to create a draft account structure for the new department. The account structure
must use the same account structure as a department named Manufacturing India and be
named Manufacturing Australia.

To complete this task, sign in to the Dynamics 365 portal.

Answer: See explanation below.

Explanation:

You need to create an account structure with the same structure as the department named
Manufacturing India by using the following instructions.

Go to Navigation pane > Modules > General ledger > Chart of accounts > Structures >
Configure account structures.
On the Action pane, click New to open the drop dialog.
In the Account structure field, type a name to describe the purpose of the account structure.
In the Description field, type a description to specify the purpose of the account structure.
Click Create.
In the Segments and allowed values, click Add segment.
1. In the dimensions list, select the dimension to add to the account structure.
At the end of the list, click Add segment.
2. Repeat step 6 to 9 as needed.
In the Allowed value details section, select the segment to edit the allowed values. For
example, click the Main Account field.
In the Operator field, select an option, such as is between and includes.
In the Value field, type a value. For example, 600000.
In the through field, type a value. For example, 699999.
In the Allowed value details section, click Apply.
3. Repeat step 10 to 15 as needed.
In the Allowed value details section, click Add new criteria.
In the Operator field, select an option, such as is between and includes.
In the Value field, type a value. For example, 033.
In the through field, type a value. For example, 034.
Click Apply.
4. In the grid, select the segment to edit the allowed values. For example, Cost Center.
In the CostCenter field, type a value. For example, 007..021.
In the Segments and allowed values, click Add.
In the MainAccount field, type a value. For example, 600000..699999
5. In the grid, select the segment to edit the allowed values. For example, Department.
In the Department field, type a value. For example, 032.
In the CostCenter field, type a value. For example, 086.
On the Action pane, click Validate.

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/tasks/create-account-
structures

QUESTION NO: 28 SIMULATION

You are a functional consultant for Contoso Entertainment System USA (USMF).

You need to assign the Accountant closing role for the USMF legal entity to an employee
named Theresa Jayne.

To complete this task, sign in to the Dynamics 365 portal.

Answer: See explanation below.

Explanation:

1. Navigate to System administration > Security > Assign users to roles

2. Select the ‘Accountant Closing’ role.
3. Click the “Manually assign / exclude users” button
4. Select the Theresa Jayne user account and click the “Assign to role” button.
5. Click the “Assign organizations” button
6. Select the “Grant access to specific organizations” option
7. Select the USMF legal entity and click the “Grant” button.

Reference:
https://www.dynamics-tips.com/system-administration/security-roles

QUESTION NO: 29 SIMULATION

You are a functional consultant for Contoso Entertainment System USA (USMF).

You need to create a report that contains the sales tax settlements for the state of California
during the quarter that began on January 1, 2017. To validate you results, save the file in
Microsoft Excel format to the Downloads\Report folder.

To complete this task, sign in to the Dynamics 365 portal.

Answer: See explanation below.

Explanation:

1. Navigate to Tax > Declarations > Report sales tax for settlement period.
2. Enter the ‘From’ date.
3. Select the settlement period (Quarter).
4. Click ‘OK’.
5. Select Yes in the Create electronic tax document field.
6. Select the Downloads\Report folder and file format.
7. Click ‘OK’.

QUESTION NO: 30

You are a Dynamics 365 Finance expert for an organization.

You need to configure the Financial period close workspace.

Which three configuration processes should you use? Each correct answer presents a part of
the solution.

NOTE: Each correct selection is worth one point.

A. Create templates that contain the required tasks within the closing process and assign to
closing role.
B. Create a separate closing schedule for every legal entity.
C. Assign a ledger calendar to the closing process.
D. Create task areas and descriptions.
E. Designate resources and their scope based on closing roles.

Answer: A, D, E

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/financial-period-close-
workspace
QUESTION NO: 31

You are a Dynamics 365 Finance consultant.

You are currently unable to collaborate or track progress toward month-end close across legal
entities in the current system.

You need to resolve the issue.

What should you configure?

A. Financial reporting
B. Financial insights workspace
C. Electronic reporting
D. Financial period close workspace

Answer: D

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/financial-period-close-
workspace

QUESTION NO: 32

You are a Dynamics 365 Finance consultant. You plan to configure the allocation base, cost
behavior, and cost distribution.

Which three actions do these configurations accomplish? Each correct answer presents a
complete solution.

NOTE: Each correct selection is worth one point.

A. Spread costs from one cost object to one or more other cost objects by applying a relevant
allocation base.
B. Measure and quantify activities, such as machine hours that are used, kilowatt hours that
are consumed, or square footage that is occupied.
C. Spread the balance of the cost from one cost object to one or more other cost objects by
applying a relevant allocation base.
D. Control which journals can be used in the costing process.
E. Classify costs according to their behavior in relation to changes in key business activities.
Answer: A, B, E

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/cost-accounting/terms-cost-
accounting

QUESTION NO: 33

You are a finance consultant. Your client needs you to configure cash flow forecasting.

The client wants specific percentages of main accounts to contribute to different cash flow
forecasts for other main accounts.

You need to configure Dynamics 365 for Finance to meet the needs of the client.

What should you do?

A. On the Cash flow forecasting setup form, configure the primary main account to assign a
percentage to the dependent account.
B. Configure the parent/child relationship for the main account and subaccounts by using
appropriate percentages.
C. Configure the cash flow forecasting setup for Accounts Payable before you configure
vendor posting profiles.
D. On the Cash flow forecasting setup form, use the Dependent Accounts setup to specify
which account and percentage is associated to the main account.

Answer: D

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/cash-bank-management/cash-flow-
forecasting

QUESTION NO: 34

A company plans to use Dynamics 365 Finance to calculate sales tax on sales orders.

You need to automatically calculate sales tax when the sales order is created.

Which three actions should you perform? Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. Assign values to the sales tax codes and assign the sales tax codes to the sales tax group
associated to the customer.
B. Assign all sales tax codes to the item sales tax group associated to the item being sold.
C. Set up a default item sales tax group on the item being sold and set up a default sales tax
group on the customer used on the sales order.
D. Associate the sales tax jurisdictions to the item sales tax group associated to the item being
sold.
E. Set up a default sales tax code on the customer used on the sales order and set up a default
item sales tax group on the item being sold.

Answer: A, B, E

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/indirect-taxes-
overview

QUESTION NO: 35

A client wants Dynamics 365 Finance to calculate sales tax on a sales order line once an item
is added. The sales tax group is already populated with a value.

You need to ensure that the sales tax will calculate.

Which field should you populate?

A. sales tax code

B. item group
C. customer address
D. item sales tax group

Answer: D

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/indirect-taxes-
overview

QUESTION NO: 36

A customer uses the sales tax functionality in Dynamics 365 Finance.

The customer reports that when a sales order is created, sales tax does not calculate on the
line.
You need to determine why sales tax is not calculated.

What are two possible reasons? Each correct answer presents a complete solution.

NOTE: Each correct selection is worth one point.

A. The sales tax group is populated on the line, but the item sales tax group is missing.
B. The sales tax settlement account is not configured correctly.
C. The sales tax authority is not set up for the correct jurisdiction.
D. The sales tax code and item sales tax code are selected, but the sales tax group is not
associated to both codes.
E. The sales tax group and item sales tax group are selected, but the sales tax code is not
associated with both groups.

Answer: A, E

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/indirect-taxes-
overview

https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/tasks/set-up-sales-tax-
groups-item-sales-tax-groups

QUESTION NO: 37 SIMULATION

You are a functional consultant for Contoso Entertainment System USA (USMF).

USMF recently opened a new bank account in the Brazilian currency.

You need to create a new bank account in the system for the new bank account.

To complete this task, sign in to the Dynamics 365 portal.

Answer: See explanation below.

Explanation:
1. Create a new bank account at Cash and bank management > Bank accounts >
Bank accounts.
2. Complete all required fields. The following list includes some fields that might be
required.
• Bank account (code)
• Bank account number
 • Main account - This is the general ledger account that is used for posting.
• Currency
• SWIFT code
3. Enter Brazil-specific information:
• Select Bank in the Bank groups field. Confirm that the BIC and Corr. Bank
account fields are correct. Also, confirm Address and Contact
information on respective FastTabs and update accordingly.
• Define the number series for payment order generation in the P/O
numeration field.
• For bank accounts in foreign currency, you can also define .docx templates for
generation of payment orders in paper format in the following fields: Payment
order in currency, Order template (currency sale), and Order template
(currency purchase).

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/localizations/rus-local-settings-
requisites-bank-module

QUESTION NO: 38

A client needs guidance on month-end closing procedures.

The client needs to be able to stop all teams except Accounts payable and General ledger
from posting transactions for the month.

You need to configure Dynamics 365 Finance to allow only those two teams to transact
during the period being closed.

Which three actions should you perform? Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. Create an access group called month end access for Accounts payable and General ledger
team members.
B. Set all modules to none to prevent any transactions from being posted.
C. Configure the financial period close workspace tasks to the Accounts payable and General
ledger teams only
D. Move the period status to on hold for your client’s one legal entity.
E. Assign the security group month end access on the ledger calendar form for the modules
they need access to.

Answer: A, C, E
QUESTION NO: 39

An organization is upgrading to Dynamics 365 Finance.

One of the organization's legal entities needs to have different main accounts for a period of
six months.

You need to configure the legal entity override dates.

Which two actions can you perform? Each correct answer presents a complete solution.

NOTE: Each correct selection is worth one point.

A. Set the value of the override date field at the legal entity level to be more restrictive.
B. Set the value of the override date field at the shared level to be more restrictive.
C. Set the value of the override date field at the legal level to be less restrictive.
D. Set the value of the override date field at the shared level to be less restrictive.

Answer: A, D

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/plan-chart-of-accounts

QUESTION NO: 40

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A client has one legal entity, two departments, and two divisions. The client is implementing
Dynamics 365 Finance. The departments and divisions are set up as financial dimensions.

The client has the following requirements:

• Only expense accounts require dimensions posted with the transactions.

• Users must not have the option to select dimensions for a balance sheet account.
You need to configure the ledger to show applicable financial dimensions based on the main
account selected in journal entry.

Solution: Configure default financial dimensions on expense accounts only.

Does the solution meet the goal?

A. Yes
B. No

Answer: B

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/configure-account-
structures

QUESTION NO: 41

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A client has one legal entity, two departments, and two divisions. The client is implementing
Dynamics 365 Finance. The departments and divisions are set up as financial dimensions.

The client has the following requirements:

• Only expense accounts require dimensions posted with the transactions.

• Users must not have the option to select dimensions for a balance sheet account.

You need to configure the ledger to show applicable financial dimensions based on the main
account selected in journal entry.

Solution: Configure two account structures: one for expense accounts and include applicable
dimensions, and one for balance sheet and exclude financial dimensions.

Does the solution meet the goal?

A. Yes
B. No

Answer: A

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/configure-account-
structures

QUESTION NO: 42

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A client has one legal entity, two departments, and two divisions. The client is implementing
Dynamics 365 Finance. The departments and divisions are set up as financial dimensions.

The client has the following requirements:

• Only expense accounts require dimensions posted with the transactions.

• Users must not have the option to select dimensions for a balance sheet account.

You need to configure the ledger to show applicable financial dimensions based on the main
account selected in journal entry.

Solution: Configure one account structure for expense accounts and apply advanced rules.

Does the solution meet the goal?

A. Yes
B. No

Answer: B

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/configure-account-
structures
QUESTION NO: 43 DRAG DROP

A customer implements Dynamics 365 Finance.

The customer observes that during foreign currency revaluation of the Accounts Receivable
subledger, the results are not as expected.

You need to re-run the foreign currency revaluation of the Accounts Receivable subledger.

Which currency revaluation method should you use for each requirement? To answer, drag
the appropriate methods to the correct requirements. Each method may be used once, more
than once, or not at all. You may need to drag the split bar between panes or scroll to view
content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="31" x2="221" y1="58" y2="88" ss="0" a="0" /><m x1="33"
x2="222" y1="99" y2="129" ss="0" a="0" /><m x1="34" x2="221" y1="142" y2="171"
ss="0" a="0" /><m x1="645" x2="834" y1="104" y2="134" ss="1" a="0" /><m x1="645"
x2="833" y1="165" y2="195" ss="1" a="0" /><m x1="646" x2="835" y1="225" y2="255"
ss="1" a="0" /><c start="0" stop="0" /><c start="1" stop="1" /><c start="2" stop="2"
/></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/cash-bank-management/foreign-
currency-revaluation-accounts-payable-accounts-receivable

QUESTION NO: 44

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution. Determine whether the solution meets
the stated goals. Some question sets might have more than one correct solution, while
others might not have a correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A customer uses Dynamics 365 Finance.

The controller notices incorrect postings to the ledger entered via journal.

The system must enforce the following:

• Expense accounts (6000-6998) require department, division, and project with all
transactions. Customer dimension is optional.
• Revenue accounts (4000-4999) require department and division and allow project and
customer dimensions.
• Liability accounts (2000-2999) should not have any dimensions posted.
• Expense account (6999) requires department, division, project and customer
dimensions with all transactions.

You need to configure the account structure to meet the requirements.

Solution:
 • Configure one account structure.
• Configure an advanced rule for Liability accounts (2000-2999) not to display any
dimensions when selected.
• Configure an advanced rule for Expense account (6999) to require customer.
• Configure the structure with all dimension fields containing quotations.

Does the solution meet the goal?

A. Yes
B. No

Answer: B
Explanation:
Dimension fields containing quotations means that a blank value is accepted. This does not
enforce a value being configured for the dimensions that are ‘Required’.

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/configure-account-
structures

QUESTION NO: 45

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution. Determine whether the solution meets
the stated goals. Some question sets might have more than one correct solution, while
others might not have a correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A customer uses Dynamics 365 Finance.

The controller notices incorrect postings to the ledger entered via journal.

The system must enforce the following:

• Expense accounts (6000-6998) require department, division, and project with all
transactions. Customer dimension is optional.
• Revenue accounts (4000-4999) require department and division and allow project and
customer dimensions.
• Liability accounts (2000-2999) should not have any dimensions posted.
 • Expense account (6999) requires department, division, project and customer
dimensions with all transactions.

You need to configure the account structure to meet the requirements.

Solution:
• Configure two account structures: one for liability accounts listing the (2000-2999)
range with no following dimensions and one for Expense and Revenue accounts.
• For Expense accounts (6000-6998) and Revenue accounts (4000-4999), configure
asterisks in all dimension columns.
• For Expense account (6999), configure asterisks in all dimensions. Configure an
asterisk and quotes in the customer dimension.

Does the solution meet the goal?

A. Yes
B. No

Answer: B
Explanation:
As asterisk in all dimension columns would mean that a value must be configured for all
dimensions.

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/configure-account-
structures

QUESTION NO: 46

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution. Determine whether the solution meets
the stated goals. Some question sets might have more than one correct solution, while
others might not have a correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A customer uses Dynamics 365 Finance.

The controller notices incorrect postings to the ledger entered via journal.

The system must enforce the following:

 • Expense accounts (6000-6998) require department, division, and project with all
transactions. Customer dimension is optional.
• Revenue accounts (4000-4999) require department and division and allow project and
customer dimensions.
• Liability accounts (2000-2999) should not have any dimensions posted.
• Expense account (6999) requires department, division, project and customer
dimensions with all transactions.

You need to configure the account structure to meet the requirements.

Solution:
• Configure one account structure with department, division, project and customer
dimensions.
• Configure asterisks in all columns for Expense accounts (6000-6999), Revenue
accounts (4000-4999), and Liability accounts (2000-2999).

Does the solution meet the goal?

A. Yes
B. No

Answer: B
Explanation:
As asterisk in all dimension columns would mean that a value must be configured for all
dimensions.

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/configure-account-
structures

QUESTION NO: 47 HOTSPOT

You are asked to configure foreign currency revaluation in Dynamics 365 Finance.

You are viewing the main accounts.

Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="56" x2="566" y1="150" y2="169" ss="0" a="0" /><m x1="52"
x2="280" y1="257" y2="276" ss="0" a="0" /></map>
Explanation:
QUESTION NO: 48 DRAG DROP

You are a consultant who is implementing Dynamics 365 Finance in your organization.

You need to set up currencies and exchange rates for a client.

Which three actions should you perform in sequence? To answer, move all actions from the
list of actions to the answer area and arrange them in the correct order.

Answer: <map><m x1="8" x2="298" y1="43" y2="106" ss="0" a="0" /><m x1="9"
x2="299" y1="112" y2="178" ss="0" a="0" /><m x1="8" x2="299" y1="184" y2="247"
ss="0" a="0" /><m x1="9" x2="301" y1="255" y2="318" ss="0" a="0" /><m x1="410"
x2="716" y1="44" y2="100" ss="1" a="0" /><m x1="411" x2="716" y1="107" y2="163"
ss="1" a="0" /><m x1="411" x2="715" y1="170" y2="227" ss="1" a="0" /><c start="3"
stop="0" /><c start="1" stop="1" /><c start="2" stop="2" /></map>
Explanation:

QUESTION NO: 49 HOTSPOT

You need to set up legal entity currencies and conversions in Dynamics 365 Finance.

You review the hierarchy for consolidation of multiple legal entities.

Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="497" x2="675" y1="143" y2="169" ss="0" a="0" /><m x1="494"
x2="672" y1="239" y2="264" ss="0" a="0" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/financial-
consolidations-currency-translation

QUESTION NO: 50

You are configuring account structures and advanced rules in Dynamics 365 Finance.

All balance sheet accounts require Business Unit and Department dimensions.
The Shareholder distribution account requires an additional dimension for Principal.

You need to set up the account structures.

What are two possible ways to achieve the goal? Each correct answer presents a complete
solution.

NOTE: Each correct selection is worth one point.

A. Create a new main account for each of the company's principals. Then, create an account
structure for all balance sheet accounts that includes the required dimension.
B. Create a new main account for Shareholder distribution. Add an advanced rule for the
Principal dimension.
C. Create an account structure for all the balance sheet accounts. Set up an advanced rule for
the Shareholder distribution account for the Principal dimension.
D. Create an account structure for balance sheet accounts without Shareholder distribution.
Then, create a second account structure for Shareholder distribution that includes all required
dimensions.

Answer: C, D

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/configure-account-
structures

QUESTION NO: 51

A client uses the standard trial balance in Dynamics 365 Finance.

The client has the following requirements:

• ability to run the trial balance by main account, department, and division
• ability to run the trial balance by just main account and department

You need to ensure that these options are visible in the trial balance report parameters.

What should you configure?

A. ledger validation
B. financial dimensions for department and division
C. financial dimension sets
D. account structure
Answer: C

QUESTION NO: 52 SIMULATION

You are a functional consultant for a legal entity named Contoso Group (GLCO).

You plan to sell new products that will increase in quality over time.

You need to implement a solution that uses the Last in, First out (LIFO) inventory model for
GLCO.

To complete this task, sign in to the Dynamics 365 portal.

Answer: See explanation below.

Explanation:

You need to configure an Inventory Model Group for the new products.

1. For inventory model groups, navigate to Inventory management | Setup | Inventory

| Item model groups.
2. Click “New” to create a new inventory model group.
3. In the “Cost method and cost recognition” section, configure the “Inventory
Model” setting to Last in, First out (LIFO).
4. Click “Save” to save the inventory model group.

QUESTION NO: 53 SIMULATION

You are a functional consultant for Contoso Entertainment System USA (USMF).

You need to generate a trial balance report for the period of January 1, 2017 to December 31,
2017. To validate you results, save the file in Microsoft Excel format to the Downloads\Trial
folder.

To complete this task, sign in to the Dynamics 365 portal.

Answer: See explanation below.

Explanation:

1. Click General ledger > Reports > Transactions > Trial Balance
2. Enter the Start and End dates for the report.
3. Click Destinations ... to specify how you want to ‘print’ the report.
 4. Select File as the destination.
5. Select the Downloads\Trial folder for the location.
6. Select Microsoft Excel for the file format.
7. Click OK to close the ‘Print destination settings’ form.
8. Click OK to ‘print’ (save) the report to the selected destination.

QUESTION NO: 54 DRAG DROP

A client plans to use financial statements in Dynamics 365 Finance. The client wants to
process the statements by using various combinations of the components to create custom
reports.

You need to associate the report components to the purpose.

Which report components should you use for each purpose? To answer, drag the appropriate
component to the correct purpose. Each component may be used once, more than once, or not
at all. You may need to drag the split bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="20" x2="208" y1="54" y2="82" ss="0" a="0" /><m x1="19"
x2="210" y1="94" y2="124" ss="0" a="0" /><m x1="20" x2="209" y1="137" y2="166"
ss="0" a="0" /><m x1="19" x2="207" y1="176" y2="207" ss="0" a="0" /><m x1="537"
x2="726" y1="77" y2="108" ss="1" a="0" /><m x1="538" x2="724" y1="122" y2="151"
ss="1" a="0" /><m x1="537" x2="727" y1="168" y2="199" ss="1" a="0" /><m x1="535"
x2="726" y1="212" y2="242" ss="1" a="0" /><c start="0" stop="0" /><c start="1" stop="1"
/><c start="2" stop="2" /><c start="3" stop="3" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/fin-ops-core/dev-itpro/analytics/financial-
report-components

QUESTION NO: 55 HOTSPOT

You are setting up main accounts in Dynamics 365 Finance.

You need to configure the main accounts to meet the requirements.

Which options should you use? To answer, select the appropriate configuration in the answer
area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="519" x2="951" y1="170" y2="205" ss="0" a="0" /><m x1="517"
x2="947" y1="437" y2="470" ss="0" a="0" /><m x1="520" x2="949" y1="521" y2="556"
ss="0" a="0" /><m x1="516" x2="948" y1="698" y2="730" ss="0" a="0" /><m x1="515"
x2="945" y1="901" y2="932" ss="0" a="0" /></map>
Explanation:
QUESTION NO: 56 DRAG DROP

You are a Dynamics 365 Finance functional consultant. A legal entity processes and settles
vendor payments on behalf of other legal entities in an organization.

You need to configure the centralized payment flow for the legal entity.

In which order should you perform the actions? To answer, move all actions from the list of
actions to the answer area and arrange them in the correct order.
NOTE: More than one order of answer choices is correct. You will receive credit for any of
the correct orders you select.

Answer: <map><m x1="16" x2="511" y1="59" y2="122" ss="0" a="0" /><m x1="16"
x2="513" y1="136" y2="198" ss="0" a="0" /><m x1="16" x2="513" y1="210" y2="272"
ss="0" a="0" /><m x1="14" x2="513" y1="286" y2="349" ss="0" a="0" /><m x1="614"
x2="1266" y1="57" y2="124" ss="1" a="0" /><m x1="614" x2="1265" y1="130" y2="198"
ss="1" a="0" /><m x1="614" x2="1263" y1="202" y2="267" ss="1" a="0" /><m x1="615"
x2="1261" y1="273" y2="342" ss="1" a="0" /><c start="2" stop="0" /><c start="0"
stop="1" /><c start="1" stop="2" /><c start="3" stop="3" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/cash-bank-
management/set-up-centralized-payments

QUESTION NO: 57

A client has one legal entity and the following four dimensions configured: Business Unit,
Cost Center, Department, and Division.

You need to configure the client’s system to run the trial balance inquiry in the General
ledger module so that it displays the trial balance two ways:
 • Include the main account and all four dimensions.
• Include the main account and only the business unit and cost center dimensions.

What should you configure?

A. two account structures

B. two derived financial dimension hierarchies
C. all financial dimensions by using the group dimension functionality
D. two financial dimension sets

Answer: D

QUESTION NO: 58

You are configuring intercompany accounting for a multicompany enterprise.

You need to set up the Due to and Due from accounts.

Which main account type should you use?

A. Profit and loss

B. Expense
C. Balance sheet
D. Liability
E. Asset

Answer: C

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/general-
ledger/intercompany-accounting-setup

QUESTION NO: 59 DRAG DROP

You are controller for a public sector organization. You need detailed fiscal tracking and
reporting.

You need to set up fund types categorized under specific fund classes.

Which fund type can you set up for each fund class? To answer, drag the appropriate fund
types to the correct fund classes. Each fund type may be used once, more than once, or not at
all. You may need to drag the split bar between panes or scroll to view content.
NOTE: Each correct selection is worth one point.

Answer: <map><m x1="32" x2="176" y1="132" y2="183" ss="0" a="0" /><m x1="32"
x2="176" y1="194" y2="247" ss="0" a="0" /><m x1="31" x2="175" y1="267" y2="320"
ss="0" a="0" /><m x1="32" x2="176" y1="337" y2="390" ss="0" a="0" /><m x1="33"
x2="175" y1="412" y2="463" ss="0" a="0" /><m x1="33" x2="175" y1="482" y2="533"
ss="0" a="0" /><m x1="561" x2="768" y1="172" y2="225" ss="1" a="0" /><m x1="560"
x2="766" y1="245" y2="297" ss="1" a="0" /><m x1="561" x2="767" y1="313" y2="363"
ss="1" a="0" /><c start="4" stop="0" /><c start="1" stop="1" /><c start="3" stop="2"
/></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/public-
sector/funds-public-sector

QUESTION NO: 60

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A client has multiple legal entities set up in Dynamics 365 Finance. All companies and data
reside in Dynamics 365 Finance.

The client currently uses a separate reporting tool to perform their financial consolidation and
eliminations. They want to use Dynamics 365 Finance instead.

You need to configure the system and correctly perform eliminations.

Solution: Select Consolidate online in Dynamics 365 Finance. Include eliminations during
the process or as a proposal. Set up the transactions to post in the legal entity configured for
consolidations.

Does the solution meet the goal?

A. Yes
B. No

Answer: B

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-
operations/financials/budgeting/consolidation-elimination-overview

QUESTION NO: 61

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A client has multiple legal entities set up in Dynamics 365 Finance. All companies and data
reside in Dynamics 365 Finance.

The client currently uses a separate reporting tool to perform their financial consolidation and
eliminations. They want to use Dynamics 365 Finance instead.

You need to configure the system and correctly perform eliminations.

Solution: Select Consolidate with import.

Does the solution meet the goal?

A. Yes
B. No

Answer: B

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-
operations/financials/budgeting/consolidation-elimination-overview

QUESTION NO: 62

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A client has multiple legal entities set up in Dynamics 365 Finance. All companies and data
reside in Dynamics 365 Finance.

The client currently uses a separate reporting tool to perform their financial consolidation and
eliminations. They want to use Dynamics 365 Finance instead.

You need to configure the system and correctly perform eliminations.

Solution: Create a separate company in which you manually create the eliminations. Then,
use that company in financial reporting or in the consolidation process.

Does the solution meet the goal?

A. Yes
B. No

Answer: A

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-
operations/financials/budgeting/consolidation-elimination-overview

QUESTION NO: 63

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.
After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A client has multiple legal entities set up in Dynamics 365 Finance. All companies and data
reside in Dynamics 365 Finance.

The client currently uses a separate reporting tool to perform their financial consolidation and
eliminations. They want to use Dynamics 365 Finance instead.

You need to configure the system and correctly perform eliminations.

Solution: Set up Elimination rules in the system. Then, run an elimination proposal.
Configure the rules to post to any company that has Use for financial elimination process
selected in the legal entity setup.

Does the solution meet the goal?

A. Yes
B. No

Answer: A

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-
operations/financials/budgeting/consolidation-elimination-overview

QUESTION NO: 64 DRAG DROP

A public sector organization wants to set up the derived financial hierarchy to analyze posted
transaction data.

You need to set up the derived financial hierarchy to generate an outgoing electronic
document.

In which order should you perform the actions? To answer, move all actions from the list of
actions to the answer area and arrange them in the correct order.
Answer: <map><m x1="7" x2="322" y1="40" y2="82" ss="0" a="0" /><m x1="9" x2="324"
y1="91" y2="132" ss="0" a="0" /><m x1="7" x2="323" y1="142" y2="182" ss="0" a="0"
/><m x1="7" x2="323" y1="190" y2="231" ss="0" a="0" /><m x1="9" x2="326" y1="238"
y2="279" ss="0" a="0" /><m x1="390" x2="744" y1="38" y2="81" ss="1" a="0" /><m
x1="391" x2="743" y1="84" y2="129" ss="1" a="0" /><m x1="392" x2="742" y1="133"
y2="181" ss="1" a="0" /><m x1="393" x2="742" y1="186" y2="232" ss="1" a="0" /><m
x1="392" x2="741" y1="236" y2="280" ss="1" a="0" /><c start="1" stop="0" /><c start="2"
stop="1" /><c start="3" stop="2" /><c start="0" stop="3" /><c start="4" stop="4" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/public-
sector/tasks/set-up-derived-financial-hierarchy-public-sector

QUESTION NO: 65

You work for a company that receives invoices in foreign currencies.

You need to configure the currency exchange rate providers and exchange rate types.
What should you do?

A. Configure exchange rate provider, create exchange rate type, and import the currency
exchange rates.
B. Select the appropriate HTML key values from the available exchange rate providers. Then,
use the provider for importing one currency exchange rate type.
C. Use a developer to write the HTML key values code to configure the currency exchange
rate providers. Then, use the provider for importing a currency exchange rate type.
D. Use a developer to write the XML key values code to configure the currency exchange
rate providers. Then, use the provider for importing a currency exchange rate type.

Answer: A

Reference:
https://community.dynamics.com/365/financeandoperations/b/365operationsbysandeepchaud
hury/posts/configure-currency-exchange-rate-providers-and-import-exchange-rates-
automatically-in-dynamics-365-for-finance-and-operations

QUESTION NO: 66

Users are posting project transactions and bank transactions incorrectly in the General
journal. The client wants to prevent this from happening in the future.

You need to configure Dynamics 365 Finance to limit the account type transactions to only
ledger.

What should you do?

A. Use journal control to specify which account types are valid for the General ledger
journal.
B. Use advanced ledger entries to define the account types that can be used in the General
ledger journal.
C. Configure the voucher series associated with this journal to allow only ledger account
types.
D. Create a journal template that has ledger as the account type and offset account type.

Answer: B

QUESTION NO: 67 SIMULATION

You are a functional consultant for Contoso Entertainment System USA (USMF).
You plan to settle accounts by receiving cash payments in US currency.

You need to create a cash receipts journal that uses the US dollar currency.

To complete this task, sign in to the Dynamics 365 portal.

Answer: See explanation below.

Explanation:

1. Navigate to Finance > Cash Receipt Journals.

2. Click the +New link to add a new cash receipt journal.
3. Fill in the required fields including the currency field.

QUESTION NO: 68 SIMULATION

You are a functional consultant for Contoso Entertainment System USA (USMF).

You need to apply a constant currency exchange rate to calculate the reporting currency value
of fixed assets.

To complete this task, sign in to the Dynamics 365 portal.

Answer: See explanation below.

Explanation:

The currency Translation Type needs to be set to Current. This option uses the last rate on
or before the period specified in the report regardless of what the exchange rate was at the
time of purchase for each asset.

1. Navigate to General Ledger > Chart of Accounts > Accounts > Main Accounts.
2. Select the Financial Reporting account.
3. In the Reporting currency exchange rate type, select Current from the drop-down
list.
4. Click Save to save the changes.

QUESTION NO: 69

An organization plans to use defined journal names for each purpose. They want to ensure
that journal processing is easier and more secure.

The organization has the following requirements:

 • Set up restrictions on the account type and segment values.
• Capture data accurately for offset accounts, currency, and financial dimensions.
• Maintain internal control and establish materiality limits.

You need to set up journal name elements to meet these requirements.

Which three journal elements should you configure? Each correct answer presents part of the
solution.

NOTE: Each correct selection is worth one point.

A. workflow approval
B. account type
C. journal type
D. default values
E. journal control

Answer: A, D, E

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/general-journal-
processing

QUESTION NO: 70 HOTSPOT

You must configure journal controls in Dynamics 365 Finance.

Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="72" x2="801" y1="122" y2="144" ss="0" a="0" /><m x1="72"
x2="937" y1="257" y2="274" ss="0" a="0" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/general-
ledger/general-journal-processing

QUESTION NO: 71 HOTSPOT

You create a financial dimension set named MA + DEPT + PROJ as shown in the following
screenshot. The financial dimension set includes the following dimensions:
 • Main Account
• Department
• Project

Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

Answer: <map><m x1="368" x2="946" y1="118" y2="140" ss="0" a="0" /><m x1="368"
x2="656" y1="256" y2="283" ss="0" a="0" /></map>
Explanation:
QUESTION NO: 72 DRAG DROP

A client has Accounts payable invoices in their legal entity in three different currencies. It is
month-end, and the client needs to run the foreign currency revaluation process to correctly
understand their currency exposure.

You need to set up Dynamics 365 Finance to perform foreign currency revaluation.

In which order should you perform the actions? To answer, move all actions from the list of
actions to the answer area and arrange them in the correct order.

NOTE: More than one order of answer choices is correct. You will receive credit for any of
the correct orders you select.

Answer: <map><m x1="7" x2="421" y1="37" y2="104" ss="0" a="0" /><m x1="6"
x2="422" y1="109" y2="176" ss="0" a="0" /><m x1="7" x2="421" y1="184" y2="252"
ss="0" a="0" /><m x1="5" x2="420" y1="256" y2="324" ss="0" a="0" /><m x1="480"
x2="894" y1="37" y2="107" ss="1" a="0" /><m x1="480" x2="895" y1="110" y2="180"
ss="1" a="0" /><m x1="481" x2="896" y1="183" y2="251" ss="1" a="0" /><m x1="482"
x2="895" y1="254" y2="322" ss="1" a="0" /><c start="2" stop="0" /><c start="3" stop="1"
/><c start="1" stop="2" /><c start="0" stop="3" /></map>
Explanation:

QUESTION NO: 73 HOTSPOT

A company is using vendors to produce components for its products.

Journal types are not configured to support vendor invoices.

You need to identify and configure journals to use for vendor invoices.

Which journal types should you use? To answer, select the appropriate options in the answer
area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="326" x2="601" y1="130" y2="149" ss="0" a="0" /><m x1="324"
x2="601" y1="247" y2="266" ss="0" a="0" /><m x1="324" x2="601" y1="346" y2="366"
ss="0" a="0" /><m x1="324" x2="600" y1="558" y2="583" ss="0" a="0" /></map>
Explanation:
QUESTION NO: 74 HOTSPOT

You are asked to configure a main account in Dynamics 365 Finance.

Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="582" x2="1333" y1="256" y2="329" ss="0" a="0" /><m x1="580"
x2="1338" y1="421" y2="464" ss="0" a="0" /></map>
Explanation:
QUESTION NO: 75 DRAG DROP

You are implementing Dynamics 365 Finance. A new product is being released.

The system must track the probability of the new product by cost center and you must use the
cost control workspace.

You need to configure the system.

Which option should you use? To answer, drag the appropriate option to the correct
requirement. Each value may be used once, more than once, or not at all. You may need to
drag the split bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="3" x2="312" y1="79" y2="134" ss="0" a="0" /><m x1="3"
x2="312" y1="145" y2="199" ss="0" a="0" /><m x1="3" x2="312" y1="212" y2="265"
ss="0" a="0" /><m x1="866" x2="1176" y1="145" y2="199" ss="1" a="0" /><m x1="866"
x2="1177" y1="217" y2="270" ss="1" a="0" /><m x1="866" x2="1177" y1="287" y2="342"
ss="1" a="0" /><c start="1" stop="0" /><c start="0" stop="1" /><c start="2" stop="2"
/></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/cost-accounting/terms-cost-
accounting

QUESTION NO: 76

Manual entry of currency exchange rates must be discontinued. Currency exchange rates
must use the current rate values provided by the European Central Bank. The exchange rate
entries and updates must be automated.

You need to configure the system.

Which two options should you use? Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. Configure the exchange rate provider

B. Run currency revaluation
C. Create the currencies
D. Configure dual currency
E. Run the import currency exchange rate process

Answer: A, E

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/import-currency-
exchange-rates
QUESTION NO: 77

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A client has one legal entity, two departments, and two divisions. The client is implementing
Dynamics 365 Finance. The departments and divisions are set up as financial dimensions.

The client has the following requirements:

• Only expense accounts require dimensions posted with the transactions.

• Users must not have the option to select dimensions for a balance sheet account.

You need to configure the ledger to show applicable financial dimensions based on the main
account selected in journal entry.

Solution: Configure one account structure for expense accounts and include applicable
dimensions.

Does the solution meet the goal?

A. Yes
B. No

Answer: B

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/configure-account-
structures

QUESTION NO: 78 DRAG DROP

You are using Microsoft Excel to complete budget planning for the next fiscal year.

Budget template data must be gathered in real time from Dynamics 365 Finance during the
budget planning process.

You need to create a budget planning template by using Microsoft Excel.

Which three actions should you perform in sequence? To answer, move the appropriate
actions from the list of actions to the answer area and arrange them in the correct order.

Answer: <map><m x1="25" x2="726" y1="60" y2="113" ss="0" a="0" /><m x1="23"
x2="723" y1="123" y2="180" ss="0" a="0" /><m x1="22" x2="723" y1="188" y2="244"
ss="0" a="0" /><m x1="24" x2="725" y1="253" y2="308" ss="0" a="0" /><m x1="745"
x2="1401" y1="60" y2="118" ss="1" a="0" /><m x1="746" x2="1402" y1="126" y2="183"
ss="1" a="0" /><m x1="747" x2="1402" y1="191" y2="246" ss="1" a="0" /><c start="3"
stop="0" /><c start="2" stop="1" /><c start="0" stop="2" /></map>
Explanation:

Step 1: Enter data from the current year's budget planning template.
Create a new template from existing data

Step 2: Add data connector fields.

Microsoft Excel can change and quickly analyze data. The Excel Data Connector app
interacts with Excel workbooks and OData services that are created for publicly exposed data
entities. The Excel Data Connector add-in enables Excel to become a seamless part of the
user experience. The Excel Data Connector add-in is built by using the Office Web add-ins
framework.

Step 3: Upload the template.

When you have your Excel template customized the way you want, you can upload it into
Dynamics 365. Where you upload the template determines its availability.

Reference: https://docs.microsoft.com/en-us/dynamics365/fin-ops-core/dev-itpro/office-
integration/office-integration
https://portal.dynamics365support.com/knowledgebase/article/KA-01250/en-us

QUESTION NO: 79
You need to configure cash flow reports.

Which three actions should you perform? Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. Configure the behavior for forecasts of transactions that affect the liquidity accounts of the
company.
B. Identify and list all the liquidity accounts.
C. Define the number sequence.
D. Configure the account structure.
E. Run the cash flow calculation process.

Answer: A, B, E
Explanation:
To obtain a forecast of the cash flow, you must complete the following tasks:

* Identify and list all the liquidity accounts. Liquidity accounts are the company's accounts
for cash or cash equivalents.
* Configure the behavior for forecasts of transactions that affect the company's liquidity
accounts.

After you've completed these tasks, you can calculate and analyze forecasts of the cash flow
and upcoming currency requirements.

The forecasting process uses transaction information that is entered in the system, and the
calculation process forecasts the expected cash impact of each transaction.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/cash-bank-
management/cash-flow-forecasting

QUESTION NO: 80

You are implementing Dynamics 365 Finance.

Sales tax payable must be posted to the same collection of accounts across all legal entities.

You need to configure the sales tax.

What should you use?

A. Posting group
B. Tax jurisdiction
C. Use tax payable account
D. Tax group

Answer: A
Explanation:
You can set up Ledger posting groups for sales tax.
Sales tax is calculated and posted to main accounts that are specified in Ledger posting
groups. Ledger posting groups are attached to each sales tax code. You can set up individual
ledger posting groups for each sales tax code, use one ledger posting group for all sales tax
codes or assign multiple ledger posting groups to the sales tax codes.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/tasks/set-
up-ledger-posting-groups-sales-tax

QUESTION NO: 81 DRAG DROP

You are implementing Dynamics 365 Finance and have deployed one instance with the
following legal entities:

You need to configure the ledger.

Which ledger currencies should be configured? To answer, drag the appropriate currency
type to the ledger currency. Each currency type may be used once, more than once, or not at
all. You may need to drag the split bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="9" x2="153" y1="42" y2="85" ss="0" a="0" /><m x1="9" x2="151"
y1="94" y2="136" ss="0" a="0" /><m x1="12" x2="151" y1="145" y2="190" ss="0" a="0"
/><m x1="448" x2="592" y1="71" y2="114" ss="1" a="0" /><m x1="449" x2="592"
y1="140" y2="184" ss="1" a="0" /><c start="1" stop="0" /><c start="2" stop="1" /></map>
Explanation:

Box 1: CAD
Reporting currency is the currency used for operational reporting to the government bodies.

Accounting currency is what your legal entity uses for amounts calculation. It is unique per
the legal entity. Reporting currency is the currency used for operational reporting to the
government bodies

Box 2: GBP
Accounting currency is what your legal entity uses for amounts calculation. It is unique per
the legal entity.

QUESTION NO: 82 DRAG DROP

You are implementing Dynamics 365 Finance.

You must associate items with an item model group. An inventory close must not be
required.
You need to configure the item model group.

Which costing method should you use? To answer, drag the appropriate costing method to
the correct system behavior. Each costing method may be used once, more than once, or not
at all. You may need to drag the split bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="11" x2="266" y1="41" y2="87" ss="0" a="0" /><m x1="10"
x2="267" y1="93" y2="137" ss="0" a="0" /><m x1="12" x2="267" y1="144" y2="188"
ss="0" a="0" /><m x1="10" x2="266" y1="196" y2="241" ss="0" a="0" /><m x1="800"
x2="1055" y1="70" y2="115" ss="1" a="0" /><m x1="799" x2="1058" y1="139" y2="186"
ss="1" a="0" /><c start="3" stop="0" /><c start="0" stop="1" /></map>
Explanation:

Box 1: Standard cost

Standard costs are estimates of the cost of goods sold -- that is, the cost required to produce
your products. They usually consist of three parts: direct materials, direct labor, and
manufacturing overhead.

Box 2: Moving average

Moving average is a perpetual costing method based on the average principle, where the costs
on inventory issues do not change when the purchase cost does.

Incorrect:
* Weighted average is an inventory model based on an average that results from the
multiplication of each component (item transaction) by a factor (cost price) reflecting its
importance (quantity). Another way to say this is that weighted average is an inventory model
that assigns the cost of issue transactions based on the mean value of all inventory received
during the period, plus any on-hand inventory from the previous period.
* First in, First out (FIFO) is an inventory model in which the first acquired receipts are
issued first. Financially updated issues from inventory are settled against the first financially
updated receipts into inventory, based on the financial date of the inventory transaction.

Reference: https://www.fool.com/the-ascent/small-business/accounting/articles/standard-cost/
https://docs.microsoft.com/en-us/dynamics365/supply-chain/cost-management/moving-
average

QUESTION NO: 83 HOTSPOT

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Fourth Coffee is a coffee and supplies manufacturer based in Seattle. The company recently
purchased CompanyA, based in the United States, and CompanyB, based in Canada, in order
to increase production of their award-winning espresso machine and distribution of their dark
roast coffee beans, respectively.
Fourth Coffee has set up CompanyA and CompanyB in their Dynamics 365 Finance to gain
better visibility into the companies’ profitability. CompanyA and CompanyB will continue to
operate as subsidiaries of Fourth Coffee, but all operational companies will be consolidated
under Fourth Coffee Holding Company in US dollars (USD) for reporting purposes.

The current organizational chart is shown below:

Current environment

Systemwide setup

• Dynamics 365 Finance in Microsoft Azure is used to manage the supply chain, retail,
and financials.
• All companies share a Chart of Accounts.
• Two dimensions are used: Department and Division.
• Budgeting is controlled at the department level.
• Customers and vendors are defined as two groups: Domestic and International.
• Mandatory credit check is set to No.
• Consolidate online is used for the consolidation of all companies.
• International main accounts are subject to foreign currency revaluation.
• The purchasing budget is used to enforce purchasing limits.

General ledger accounts

Fourth Coffee

• The base currency is USD.

• Three item groups are used: coffee, supplies, and nonstock.
• The standard sales tax method is used.
 • Acquiring fixed assets requires a purchase order.
• All customer payment journals require a deposit slip.
• CustomerX is a taxable company.
• CustomerY is a tax-exempt company.
• CustomerZ is a taxable company.
• VendorA is a Colombian supplier of coffee beans and belongs to the international
vendor group.
• VendorB is a Peruvian supplier of coffee machine filters and belongs to the
international vendor group.
• VendorC is a Texas supplier of espresso valves and belongs to the domestic vendor
group.

CompanyA

• The base currency is USD.

• It consists of a marketing department and a digital division.
• A 4-5-4 calendar structure is used.
• The standard sales tax method is used.

CompanyB

• The base currency is CAD.

• The conditional sales tax method is used.

Requirements

Reporting

• A consolidated Fourth Coffee financial report is required in USD currency.

• Fourth Coffee and its subsidiaries need to be able to report sales by item type.
• Year-end adjustments need to be reported separately in a different period to view
financial reporting inclusive and exclusive of year-end adjustments.

Issues

• User1 observes that a General journal was used in error to post to the Domestic
Accounts Receivable trade account.
• User2 has to repeatedly reclassify vendor invoice journals in Fourth Coffee Company
that are posted to the marketing department and digital division.
• When User3 posts an Accounts receivable payment journal, a deposit slip is not
generated.
• User4 observes an increase in procurement department expenses for supplies.
 • User5 observes that sales tax is not calculating on a sales order for CustomerZ.
• User6 observes that sales tax is calculating for CustomerY.
• User7 observes that the sales tax payment report is excluding posted invoice
transactions.
• User8 in CompanyA attempts to set up the sales tax receivable account on the sales
tax posting form.
• User9 in CompanyA needs to purchase three tablets by using a purchase order and
record the devices as fixed assets.
• CustomerX requires a credit check when making a purchase and is currently at their
credit limit.

You need to configure settings to resolve User1’s issue.

Which settings should you use? To answer, select the appropriate options in the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="399" x2="674" y1="117" y2="140" ss="0" a="0" /><m x1="396"
x2="672" y1="239" y2="267" ss="0" a="0" /></map>
Explanation:
QUESTION NO: 84

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background
Fourth Coffee is a coffee and supplies manufacturer based in Seattle. The company recently
purchased CompanyA, based in the United States, and CompanyB, based in Canada, in order
to increase production of their award-winning espresso machine and distribution of their dark
roast coffee beans, respectively.

Fourth Coffee has set up CompanyA and CompanyB in their Dynamics 365 Finance to gain
better visibility into the companies’ profitability. CompanyA and CompanyB will continue to
operate as subsidiaries of Fourth Coffee, but all operational companies will be consolidated
under Fourth Coffee Holding Company in US dollars (USD) for reporting purposes.

The current organizational chart is shown below:

Current environment

Systemwide setup

• Dynamics 365 Finance in Microsoft Azure is used to manage the supply chain, retail,
and financials.
• All companies share a Chart of Accounts.
• Two dimensions are used: Department and Division.
• Budgeting is controlled at the department level.
• Customers and vendors are defined as two groups: Domestic and International.
• Mandatory credit check is set to No.
• Consolidate online is used for the consolidation of all companies.
• International main accounts are subject to foreign currency revaluation.
• The purchasing budget is used to enforce purchasing limits.

General ledger accounts

Fourth Coffee

• The base currency is USD.

• Three item groups are used: coffee, supplies, and nonstock.
• The standard sales tax method is used.
• Acquiring fixed assets requires a purchase order.
• All customer payment journals require a deposit slip.
• CustomerX is a taxable company.
• CustomerY is a tax-exempt company.
• CustomerZ is a taxable company.
• VendorA is a Colombian supplier of coffee beans and belongs to the international
vendor group.
• VendorB is a Peruvian supplier of coffee machine filters and belongs to the
international vendor group.
• VendorC is a Texas supplier of espresso valves and belongs to the domestic vendor
group.

CompanyA

• The base currency is USD.

• It consists of a marketing department and a digital division.
• A 4-5-4 calendar structure is used.
• The standard sales tax method is used.

CompanyB

• The base currency is CAD.

• The conditional sales tax method is used.

Requirements

Reporting

• A consolidated Fourth Coffee financial report is required in USD currency.

• Fourth Coffee and its subsidiaries need to be able to report sales by item type.
• Year-end adjustments need to be reported separately in a different period to view
financial reporting inclusive and exclusive of year-end adjustments.

Issues

• User1 observes that a General journal was used in error to post to the Domestic
Accounts Receivable trade account.
 • User2 has to repeatedly reclassify vendor invoice journals in Fourth Coffee Company
that are posted to the marketing department and digital division.
• When User3 posts an Accounts receivable payment journal, a deposit slip is not
generated.
• User4 observes an increase in procurement department expenses for supplies.
• User5 observes that sales tax is not calculating on a sales order for CustomerZ.
• User6 observes that sales tax is calculating for CustomerY.
• User7 observes that the sales tax payment report is excluding posted invoice
transactions.
• User8 in CompanyA attempts to set up the sales tax receivable account on the sales
tax posting form.
• User9 in CompanyA needs to purchase three tablets by using a purchase order and
record the devices as fixed assets.
• CustomerX requires a credit check when making a purchase and is currently at their
credit limit.

You need to correct the sales tax setup to resolve User5's issue.

Which three actions should you perform? Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. Populate the sales tax code on the sales order line.

B. Assign the sales tax group to CustomerY.
C. Assign the relevant sales tax code to both the sales tax and item sales tax groups.
D. Populate the item sales tax group field on the sales order line.
E. Populate the sales tax group field on the sales order line.

Answer: C, D, E

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/indirect-taxes-
overview

QUESTION NO: 85

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Fourth Coffee is a coffee and supplies manufacturer based in Seattle. The company recently
purchased CompanyA, based in the United States, and CompanyB, based in Canada, in order
to increase production of their award-winning espresso machine and distribution of their dark
roast coffee beans, respectively.

Fourth Coffee has set up CompanyA and CompanyB in their Dynamics 365 Finance to gain
better visibility into the companies’ profitability. CompanyA and CompanyB will continue to
operate as subsidiaries of Fourth Coffee, but all operational companies will be consolidated
under Fourth Coffee Holding Company in US dollars (USD) for reporting purposes.

The current organizational chart is shown below:

Current environment
Systemwide setup

• Dynamics 365 Finance in Microsoft Azure is used to manage the supply chain, retail,
and financials.
• All companies share a Chart of Accounts.
• Two dimensions are used: Department and Division.
• Budgeting is controlled at the department level.
• Customers and vendors are defined as two groups: Domestic and International.
• Mandatory credit check is set to No.
• Consolidate online is used for the consolidation of all companies.
• International main accounts are subject to foreign currency revaluation.
• The purchasing budget is used to enforce purchasing limits.

General ledger accounts

Fourth Coffee

• The base currency is USD.

• Three item groups are used: coffee, supplies, and nonstock.
• The standard sales tax method is used.
• Acquiring fixed assets requires a purchase order.
• All customer payment journals require a deposit slip.
• CustomerX is a taxable company.
• CustomerY is a tax-exempt company.
• CustomerZ is a taxable company.
• VendorA is a Colombian supplier of coffee beans and belongs to the international
vendor group.
• VendorB is a Peruvian supplier of coffee machine filters and belongs to the
international vendor group.
• VendorC is a Texas supplier of espresso valves and belongs to the domestic vendor
group.

CompanyA

• The base currency is USD.

 • It consists of a marketing department and a digital division.
• A 4-5-4 calendar structure is used.
• The standard sales tax method is used.

CompanyB

• The base currency is CAD.

• The conditional sales tax method is used.

Requirements

Reporting

• A consolidated Fourth Coffee financial report is required in USD currency.

• Fourth Coffee and its subsidiaries need to be able to report sales by item type.
• Year-end adjustments need to be reported separately in a different period to view
financial reporting inclusive and exclusive of year-end adjustments.

Issues

• User1 observes that a General journal was used in error to post to the Domestic
Accounts Receivable trade account.
• User2 has to repeatedly reclassify vendor invoice journals in Fourth Coffee Company
that are posted to the marketing department and digital division.
• When User3 posts an Accounts receivable payment journal, a deposit slip is not
generated.
• User4 observes an increase in procurement department expenses for supplies.
• User5 observes that sales tax is not calculating on a sales order for CustomerZ.
• User6 observes that sales tax is calculating for CustomerY.
• User7 observes that the sales tax payment report is excluding posted invoice
transactions.
• User8 in CompanyA attempts to set up the sales tax receivable account on the sales
tax posting form.
• User9 in CompanyA needs to purchase three tablets by using a purchase order and
record the devices as fixed assets.
• CustomerX requires a credit check when making a purchase and is currently at their
credit limit.

You need to troubleshoot the reporting issue for User7.

Why are some transactions being excluded?

A. User7 is running the report in CompanyB.
B. User7 is running the report in CompanyA.
C. The report is correctly excluding CustomerY transactions.
D. The report is correctly excluding CustomerZ transactions.

Answer: C

QUESTION NO: 86

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Fourth Coffee is a coffee and supplies manufacturer based in Seattle. The company recently
purchased CompanyA, based in the United States, and CompanyB, based in Canada, in order
to increase production of their award-winning espresso machine and distribution of their dark
roast coffee beans, respectively.

Fourth Coffee has set up CompanyA and CompanyB in their Dynamics 365 Finance to gain
better visibility into the companies’ profitability. CompanyA and CompanyB will continue to
operate as subsidiaries of Fourth Coffee, but all operational companies will be consolidated
under Fourth Coffee Holding Company in US dollars (USD) for reporting purposes.

The current organizational chart is shown below:

Current environment

Systemwide setup

• Dynamics 365 Finance in Microsoft Azure is used to manage the supply chain, retail,
and financials.
• All companies share a Chart of Accounts.
• Two dimensions are used: Department and Division.
• Budgeting is controlled at the department level.
• Customers and vendors are defined as two groups: Domestic and International.
• Mandatory credit check is set to No.
• Consolidate online is used for the consolidation of all companies.
• International main accounts are subject to foreign currency revaluation.
• The purchasing budget is used to enforce purchasing limits.

General ledger accounts

Fourth Coffee

• The base currency is USD.

• Three item groups are used: coffee, supplies, and nonstock.
• The standard sales tax method is used.
• Acquiring fixed assets requires a purchase order.
• All customer payment journals require a deposit slip.
 • CustomerX is a taxable company.
• CustomerY is a tax-exempt company.
• CustomerZ is a taxable company.
• VendorA is a Colombian supplier of coffee beans and belongs to the international
vendor group.
• VendorB is a Peruvian supplier of coffee machine filters and belongs to the
international vendor group.
• VendorC is a Texas supplier of espresso valves and belongs to the domestic vendor
group.

CompanyA

• The base currency is USD.

• It consists of a marketing department and a digital division.
• A 4-5-4 calendar structure is used.
• The standard sales tax method is used.

CompanyB

• The base currency is CAD.

• The conditional sales tax method is used.

Requirements

Reporting

• A consolidated Fourth Coffee financial report is required in USD currency.

• Fourth Coffee and its subsidiaries need to be able to report sales by item type.
• Year-end adjustments need to be reported separately in a different period to view
financial reporting inclusive and exclusive of year-end adjustments.

Issues

• User1 observes that a General journal was used in error to post to the Domestic
Accounts Receivable trade account.
• User2 has to repeatedly reclassify vendor invoice journals in Fourth Coffee Company
that are posted to the marketing department and digital division.
• When User3 posts an Accounts receivable payment journal, a deposit slip is not
generated.
• User4 observes an increase in procurement department expenses for supplies.
• User5 observes that sales tax is not calculating on a sales order for CustomerZ.
• User6 observes that sales tax is calculating for CustomerY.
 • User7 observes that the sales tax payment report is excluding posted invoice
transactions.
• User8 in CompanyA attempts to set up the sales tax receivable account on the sales
tax posting form.
• User9 in CompanyA needs to purchase three tablets by using a purchase order and
record the devices as fixed assets.
• CustomerX requires a credit check when making a purchase and is currently at their
credit limit.

You need to configure settings to resolve User8’s issue.

What should you select?

A. a main account in the sales tax payable field

B. a main account in the settlement account field
C. the Conditional sales tax checkbox
D. the Standard sales tax checkbox

Answer: B

QUESTION NO: 87 DRAG DROP

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Fourth Coffee is a coffee and supplies manufacturer based in Seattle. The company recently
purchased CompanyA, based in the United States, and CompanyB, based in Canada, in order
to increase production of their award-winning espresso machine and distribution of their dark
roast coffee beans, respectively.

Fourth Coffee has set up CompanyA and CompanyB in their Dynamics 365 Finance to gain
better visibility into the companies’ profitability. CompanyA and CompanyB will continue to
operate as subsidiaries of Fourth Coffee, but all operational companies will be consolidated
under Fourth Coffee Holding Company in US dollars (USD) for reporting purposes.

The current organizational chart is shown below:

Current environment

Systemwide setup

• Dynamics 365 Finance in Microsoft Azure is used to manage the supply chain, retail,
and financials.
• All companies share a Chart of Accounts.
• Two dimensions are used: Department and Division.
• Budgeting is controlled at the department level.
• Customers and vendors are defined as two groups: Domestic and International.
• Mandatory credit check is set to No.
• Consolidate online is used for the consolidation of all companies.
• International main accounts are subject to foreign currency revaluation.
• The purchasing budget is used to enforce purchasing limits.
General ledger accounts

Fourth Coffee

• The base currency is USD.

• Three item groups are used: coffee, supplies, and nonstock.
• The standard sales tax method is used.
• Acquiring fixed assets requires a purchase order.
• All customer payment journals require a deposit slip.
• CustomerX is a taxable company.
• CustomerY is a tax-exempt company.
• CustomerZ is a taxable company.
• VendorA is a Colombian supplier of coffee beans and belongs to the international
vendor group.
• VendorB is a Peruvian supplier of coffee machine filters and belongs to the
international vendor group.
• VendorC is a Texas supplier of espresso valves and belongs to the domestic vendor
group.

CompanyA

• The base currency is USD.

• It consists of a marketing department and a digital division.
• A 4-5-4 calendar structure is used.
• The standard sales tax method is used.

CompanyB

• The base currency is CAD.

• The conditional sales tax method is used.

Requirements

Reporting

• A consolidated Fourth Coffee financial report is required in USD currency.

• Fourth Coffee and its subsidiaries need to be able to report sales by item type.
 • Year-end adjustments need to be reported separately in a different period to view
financial reporting inclusive and exclusive of year-end adjustments.

Issues

• User1 observes that a General journal was used in error to post to the Domestic
Accounts Receivable trade account.
• User2 has to repeatedly reclassify vendor invoice journals in Fourth Coffee Company
that are posted to the marketing department and digital division.
• When User3 posts an Accounts receivable payment journal, a deposit slip is not
generated.
• User4 observes an increase in procurement department expenses for supplies.
• User5 observes that sales tax is not calculating on a sales order for CustomerZ.
• User6 observes that sales tax is calculating for CustomerY.
• User7 observes that the sales tax payment report is excluding posted invoice
transactions.
• User8 in CompanyA attempts to set up the sales tax receivable account on the sales
tax posting form.
• User9 in CompanyA needs to purchase three tablets by using a purchase order and
record the devices as fixed assets.
• CustomerX requires a credit check when making a purchase and is currently at their
credit limit.

You need to assist User3 with generating a deposit slip to meet Fourth Coffee's requirement.

Which five actions should you perform in sequence? To answer, move the appropriate actions
from the list of actions to the answer area and arrange them in the correct order.

NOTE: More than one order of answer choices is correct. You will receive credit for any of
the correct orders you select.
Answer: <map><m x1="20" x2="464" y1="44" y2="85" ss="0" a="0" /><m x1="21"
x2="464" y1="98" y2="138" ss="0" a="0" /><m x1="20" x2="463" y1="150" y2="192"
ss="0" a="0" /><m x1="19" x2="463" y1="203" y2="246" ss="0" a="0" /><m x1="19"
x2="463" y1="257" y2="296" ss="0" a="0" /><m x1="18" x2="465" y1="309" y2="351"
ss="0" a="0" /><m x1="502" x2="956" y1="43" y2="85" ss="1" a="0" /><m x1="502"
x2="956" y1="91" y2="137" ss="1" a="0" /><m x1="502" x2="958" y1="144" y2="190"
ss="1" a="0" /><m x1="501" x2="958" y1="196" y2="241" ss="1" a="0" /><m x1="501"
x2="958" y1="248" y2="294" ss="1" a="0" /><c start="3" stop="0" /><c start="0" stop="1"
/><c start="1" stop="2" /><c start="5" stop="3" /><c start="4" stop="4" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamicsax-2012/appuser-itpro/create-a-deposit-slip

QUESTION NO: 88

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.
At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Fourth Coffee is a coffee and supplies manufacturer based in Seattle. The company recently
purchased CompanyA, based in the United States, and CompanyB, based in Canada, in order
to increase production of their award-winning espresso machine and distribution of their dark
roast coffee beans, respectively.

Fourth Coffee has set up CompanyA and CompanyB in their Dynamics 365 Finance to gain
better visibility into the companies’ profitability. CompanyA and CompanyB will continue to
operate as subsidiaries of Fourth Coffee, but all operational companies will be consolidated
under Fourth Coffee Holding Company in US dollars (USD) for reporting purposes.

The current organizational chart is shown below:

Current environment

Systemwide setup

• Dynamics 365 Finance in Microsoft Azure is used to manage the supply chain, retail,
and financials.
• All companies share a Chart of Accounts.
• Two dimensions are used: Department and Division.
• Budgeting is controlled at the department level.
 • Customers and vendors are defined as two groups: Domestic and International.
• Mandatory credit check is set to No.
• Consolidate online is used for the consolidation of all companies.
• International main accounts are subject to foreign currency revaluation.
• The purchasing budget is used to enforce purchasing limits.

General ledger accounts

Fourth Coffee

• The base currency is USD.

• Three item groups are used: coffee, supplies, and nonstock.
• The standard sales tax method is used.
• Acquiring fixed assets requires a purchase order.
• All customer payment journals require a deposit slip.
• CustomerX is a taxable company.
• CustomerY is a tax-exempt company.
• CustomerZ is a taxable company.
• VendorA is a Colombian supplier of coffee beans and belongs to the international
vendor group.
• VendorB is a Peruvian supplier of coffee machine filters and belongs to the
international vendor group.
• VendorC is a Texas supplier of espresso valves and belongs to the domestic vendor
group.

CompanyA

• The base currency is USD.

• It consists of a marketing department and a digital division.
• A 4-5-4 calendar structure is used.
• The standard sales tax method is used.

CompanyB

• The base currency is CAD.

• The conditional sales tax method is used.
Requirements

Reporting

• A consolidated Fourth Coffee financial report is required in USD currency.

• Fourth Coffee and its subsidiaries need to be able to report sales by item type.
• Year-end adjustments need to be reported separately in a different period to view
financial reporting inclusive and exclusive of year-end adjustments.

Issues

• User1 observes that a General journal was used in error to post to the Domestic
Accounts Receivable trade account.
• User2 has to repeatedly reclassify vendor invoice journals in Fourth Coffee Company
that are posted to the marketing department and digital division.
• When User3 posts an Accounts receivable payment journal, a deposit slip is not
generated.
• User4 observes an increase in procurement department expenses for supplies.
• User5 observes that sales tax is not calculating on a sales order for CustomerZ.
• User6 observes that sales tax is calculating for CustomerY.
• User7 observes that the sales tax payment report is excluding posted invoice
transactions.
• User8 in CompanyA attempts to set up the sales tax receivable account on the sales
tax posting form.
• User9 in CompanyA needs to purchase three tablets by using a purchase order and
record the devices as fixed assets.
• CustomerX requires a credit check when making a purchase and is currently at their
credit limit.

You need to view the results of Fourth Coffee Holding Company's consolidation.

Which three places show the results of financial consolidation? Each correct answer presents
a complete solution.

NOTE: Each correct selection is worth one point.

A. a financial report run against the company Fourth Coffee

B. a trial balance in the Fourth Coffee Holding Company
C. a trial balance in the company Fourth Coffee
D. a financial report run against the Fourth Coffee Holding Company
E. the consolidations form in Fourth Coffee Holding Company
Answer: B, D, E

QUESTION NO: 89

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Fourth Coffee is a coffee and supplies manufacturer based in Seattle. The company recently
purchased CompanyA, based in the United States, and CompanyB, based in Canada, in order
to increase production of their award-winning espresso machine and distribution of their dark
roast coffee beans, respectively.

Fourth Coffee has set up CompanyA and CompanyB in their Dynamics 365 Finance to gain
better visibility into the companies’ profitability. CompanyA and CompanyB will continue to
operate as subsidiaries of Fourth Coffee, but all operational companies will be consolidated
under Fourth Coffee Holding Company in US dollars (USD) for reporting purposes.

The current organizational chart is shown below:

Current environment

Systemwide setup

• Dynamics 365 Finance in Microsoft Azure is used to manage the supply chain, retail,
and financials.
• All companies share a Chart of Accounts.
• Two dimensions are used: Department and Division.
• Budgeting is controlled at the department level.
• Customers and vendors are defined as two groups: Domestic and International.
• Mandatory credit check is set to No.
• Consolidate online is used for the consolidation of all companies.
• International main accounts are subject to foreign currency revaluation.
• The purchasing budget is used to enforce purchasing limits.

General ledger accounts

Fourth Coffee

• The base currency is USD.

• Three item groups are used: coffee, supplies, and nonstock.
• The standard sales tax method is used.
• Acquiring fixed assets requires a purchase order.
• All customer payment journals require a deposit slip.
• CustomerX is a taxable company.
• CustomerY is a tax-exempt company.
• CustomerZ is a taxable company.
 • VendorA is a Colombian supplier of coffee beans and belongs to the international
vendor group.
• VendorB is a Peruvian supplier of coffee machine filters and belongs to the
international vendor group.
• VendorC is a Texas supplier of espresso valves and belongs to the domestic vendor
group.

CompanyA

• The base currency is USD.

• It consists of a marketing department and a digital division.
• A 4-5-4 calendar structure is used.
• The standard sales tax method is used.

CompanyB

• The base currency is CAD.

• The conditional sales tax method is used.

Requirements

Reporting

• A consolidated Fourth Coffee financial report is required in USD currency.

• Fourth Coffee and its subsidiaries need to be able to report sales by item type.
• Year-end adjustments need to be reported separately in a different period to view
financial reporting inclusive and exclusive of year-end adjustments.

Issues

• User1 observes that a General journal was used in error to post to the Domestic
Accounts Receivable trade account.
• User2 has to repeatedly reclassify vendor invoice journals in Fourth Coffee Company
that are posted to the marketing department and digital division.
• When User3 posts an Accounts receivable payment journal, a deposit slip is not
generated.
• User4 observes an increase in procurement department expenses for supplies.
• User5 observes that sales tax is not calculating on a sales order for CustomerZ.
• User6 observes that sales tax is calculating for CustomerY.
• User7 observes that the sales tax payment report is excluding posted invoice
transactions.
• User8 in CompanyA attempts to set up the sales tax receivable account on the sales
tax posting form.
 • User9 in CompanyA needs to purchase three tablets by using a purchase order and
record the devices as fixed assets.
• CustomerX requires a credit check when making a purchase and is currently at their
credit limit.

You need to configure the system to resolve User8's issue.

What should you select?

A. the Standard sales tax checkbox

B. the Conditional sales tax checkbox
C. a main account in the settlement account field
D. a main account in the sales tax payable field

Answer: C

QUESTION NO: 90 HOTSPOT

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.
Background

Fourth Coffee is a coffee and supplies manufacturer based in Seattle. The company recently
purchased CompanyA, based in the United States, and CompanyB, based in Canada, in order
to increase production of their award-winning espresso machine and distribution of their dark
roast coffee beans, respectively.

Fourth Coffee has set up CompanyA and CompanyB in their Dynamics 365 Finance to gain
better visibility into the companies’ profitability. CompanyA and CompanyB will continue to
operate as subsidiaries of Fourth Coffee, but all operational companies will be consolidated
under Fourth Coffee Holding Company in US dollars (USD) for reporting purposes.

The current organizational chart is shown below:

Current environment

Systemwide setup

• Dynamics 365 Finance in Microsoft Azure is used to manage the supply chain, retail,
and financials.
• All companies share a Chart of Accounts.
• Two dimensions are used: Department and Division.
• Budgeting is controlled at the department level.
• Customers and vendors are defined as two groups: Domestic and International.
• Mandatory credit check is set to No.
• Consolidate online is used for the consolidation of all companies.
• International main accounts are subject to foreign currency revaluation.
• The purchasing budget is used to enforce purchasing limits.

General ledger accounts

Fourth Coffee

• The base currency is USD.

• Three item groups are used: coffee, supplies, and nonstock.
• The standard sales tax method is used.
• Acquiring fixed assets requires a purchase order.
• All customer payment journals require a deposit slip.
• CustomerX is a taxable company.
• CustomerY is a tax-exempt company.
• CustomerZ is a taxable company.
• VendorA is a Colombian supplier of coffee beans and belongs to the international
vendor group.
• VendorB is a Peruvian supplier of coffee machine filters and belongs to the
international vendor group.
• VendorC is a Texas supplier of espresso valves and belongs to the domestic vendor
group.

CompanyA

• The base currency is USD.

• It consists of a marketing department and a digital division.
• A 4-5-4 calendar structure is used.
• The standard sales tax method is used.

CompanyB

• The base currency is CAD.

• The conditional sales tax method is used.

Requirements

Reporting

• A consolidated Fourth Coffee financial report is required in USD currency.

• Fourth Coffee and its subsidiaries need to be able to report sales by item type.
• Year-end adjustments need to be reported separately in a different period to view
financial reporting inclusive and exclusive of year-end adjustments.
Issues

• User1 observes that a General journal was used in error to post to the Domestic
Accounts Receivable trade account.
• User2 has to repeatedly reclassify vendor invoice journals in Fourth Coffee Company
that are posted to the marketing department and digital division.
• When User3 posts an Accounts receivable payment journal, a deposit slip is not
generated.
• User4 observes an increase in procurement department expenses for supplies.
• User5 observes that sales tax is not calculating on a sales order for CustomerZ.
• User6 observes that sales tax is calculating for CustomerY.
• User7 observes that the sales tax payment report is excluding posted invoice
transactions.
• User8 in CompanyA attempts to set up the sales tax receivable account on the sales
tax posting form.
• User9 in CompanyA needs to purchase three tablets by using a purchase order and
record the devices as fixed assets.
• CustomerX requires a credit check when making a purchase and is currently at their
credit limit.

The posting configuration for a purchase order is shown as follows:

Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="463" x2="596" y1="66" y2="92" ss="0" a="0" /><m x1="462"
x2="595" y1="267" y2="292" ss="0" a="0" /></map>
Explanation:

QUESTION NO: 91 HOTSPOT

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Fourth Coffee is a coffee and supplies manufacturer based in Seattle. The company recently
purchased CompanyA, based in the United States, and CompanyB, based in Canada, in order
to increase production of their award-winning espresso machine and distribution of their dark
roast coffee beans, respectively.

Fourth Coffee has set up CompanyA and CompanyB in their Dynamics 365 Finance to gain
better visibility into the companies’ profitability. CompanyA and CompanyB will continue to
operate as subsidiaries of Fourth Coffee, but all operational companies will be consolidated
under Fourth Coffee Holding Company in US dollars (USD) for reporting purposes.

The current organizational chart is shown below:

Current environment
Systemwide setup

• Dynamics 365 Finance in Microsoft Azure is used to manage the supply chain, retail,
and financials.
• All companies share a Chart of Accounts.
• Two dimensions are used: Department and Division.
• Budgeting is controlled at the department level.
• Customers and vendors are defined as two groups: Domestic and International.
• Mandatory credit check is set to No.
• Consolidate online is used for the consolidation of all companies.
• International main accounts are subject to foreign currency revaluation.
• The purchasing budget is used to enforce purchasing limits.

General ledger accounts

Fourth Coffee

• The base currency is USD.

• Three item groups are used: coffee, supplies, and nonstock.
• The standard sales tax method is used.
• Acquiring fixed assets requires a purchase order.
• All customer payment journals require a deposit slip.
• CustomerX is a taxable company.
• CustomerY is a tax-exempt company.
• CustomerZ is a taxable company.
• VendorA is a Colombian supplier of coffee beans and belongs to the international
vendor group.
• VendorB is a Peruvian supplier of coffee machine filters and belongs to the
international vendor group.
• VendorC is a Texas supplier of espresso valves and belongs to the domestic vendor
group.

CompanyA

• The base currency is USD.

• It consists of a marketing department and a digital division.
 • A 4-5-4 calendar structure is used.
• The standard sales tax method is used.

CompanyB

• The base currency is CAD.

• The conditional sales tax method is used.

Requirements

Reporting

• A consolidated Fourth Coffee financial report is required in USD currency.

• Fourth Coffee and its subsidiaries need to be able to report sales by item type.
• Year-end adjustments need to be reported separately in a different period to view
financial reporting inclusive and exclusive of year-end adjustments.

Issues

• User1 observes that a General journal was used in error to post to the Domestic
Accounts Receivable trade account.
• User2 has to repeatedly reclassify vendor invoice journals in Fourth Coffee Company
that are posted to the marketing department and digital division.
• When User3 posts an Accounts receivable payment journal, a deposit slip is not
generated.
• User4 observes an increase in procurement department expenses for supplies.
• User5 observes that sales tax is not calculating on a sales order for CustomerZ.
• User6 observes that sales tax is calculating for CustomerY.
• User7 observes that the sales tax payment report is excluding posted invoice
transactions.
• User8 in CompanyA attempts to set up the sales tax receivable account on the sales
tax posting form.
• User9 in CompanyA needs to purchase three tablets by using a purchase order and
record the devices as fixed assets.
• CustomerX requires a credit check when making a purchase and is currently at their
credit limit.

You need to prevent a reoccurrence of User2’s issue.

How should you configure the system? To answer, select the appropriate options in the
answer area.
NOTE: Each correct selection is worth one point.

Answer: <map><m x1="334" x2="940" y1="146" y2="173" ss="0" a="0" /><m x1="334"
x2="939" y1="339" y2="367" ss="0" a="0" /><m x1="334" x2="938" y1="424" y2="453"
ss="0" a="0" /></map>
Explanation:

QUESTION NO: 92

Case study
This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Fourth Coffee is a coffee and supplies manufacturer based in Seattle. The company recently
purchased CompanyA, based in the United States, and CompanyB, based in Canada, in order
to increase production of their award-winning espresso machine and distribution of their dark
roast coffee beans, respectively.

Fourth Coffee has set up CompanyA and CompanyB in their Dynamics 365 Finance to gain
better visibility into the companies’ profitability. CompanyA and CompanyB will continue to
operate as subsidiaries of Fourth Coffee, but all operational companies will be consolidated
under Fourth Coffee Holding Company in US dollars (USD) for reporting purposes.

The current organizational chart is shown below:

Current environment

Systemwide setup

• Dynamics 365 Finance in Microsoft Azure is used to manage the supply chain, retail,
and financials.
• All companies share a Chart of Accounts.
• Two dimensions are used: Department and Division.
• Budgeting is controlled at the department level.
• Customers and vendors are defined as two groups: Domestic and International.
• Mandatory credit check is set to No.
• Consolidate online is used for the consolidation of all companies.
• International main accounts are subject to foreign currency revaluation.
• The purchasing budget is used to enforce purchasing limits.

General ledger accounts

Fourth Coffee

• The base currency is USD.

• Three item groups are used: coffee, supplies, and nonstock.
• The standard sales tax method is used.
• Acquiring fixed assets requires a purchase order.
• All customer payment journals require a deposit slip.
• CustomerX is a taxable company.
• CustomerY is a tax-exempt company.
• CustomerZ is a taxable company.
• VendorA is a Colombian supplier of coffee beans and belongs to the international
vendor group.
• VendorB is a Peruvian supplier of coffee machine filters and belongs to the
international vendor group.
• VendorC is a Texas supplier of espresso valves and belongs to the domestic vendor
group.

CompanyA
 • The base currency is USD.
• It consists of a marketing department and a digital division.
• A 4-5-4 calendar structure is used.
• The standard sales tax method is used.

CompanyB

• The base currency is CAD.

• The conditional sales tax method is used.

Requirements

Reporting

• A consolidated Fourth Coffee financial report is required in USD currency.

• Fourth Coffee and its subsidiaries need to be able to report sales by item type.
• Year-end adjustments need to be reported separately in a different period to view
financial reporting inclusive and exclusive of year-end adjustments.

Issues

• User1 observes that a General journal was used in error to post to the Domestic
Accounts Receivable trade account.
• User2 has to repeatedly reclassify vendor invoice journals in Fourth Coffee Company
that are posted to the marketing department and digital division.
• When User3 posts an Accounts receivable payment journal, a deposit slip is not
generated.
• User4 observes an increase in procurement department expenses for supplies.
• User5 observes that sales tax is not calculating on a sales order for CustomerZ.
• User6 observes that sales tax is calculating for CustomerY.
• User7 observes that the sales tax payment report is excluding posted invoice
transactions.
• User8 in CompanyA attempts to set up the sales tax receivable account on the sales
tax posting form.
• User9 in CompanyA needs to purchase three tablets by using a purchase order and
record the devices as fixed assets.
• CustomerX requires a credit check when making a purchase and is currently at their
credit limit.

You need to configure the financial reporting fiscal calendar for CustomerX.

What should you do?

A. Use the ledger calendar to set up the 4-5-4 calendar.
B. Configure the fiscal calendar to include a 13th closing period.
C. Configure the ledger calendar to include a 13th closing period.
D. Use the closing period adjustments form.

Answer: D
Explanation:
CustomerX is a taxable company.
CustomerX requires a credit check when making a purchase and is currently at their credit
limit.
Reporting: financial reporting inclusive and exclusive of year-end adjustments.

QUESTION NO: 93 HOTSPOT

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background
Munson’s Pickles and Preserves Farm grows and distributes produce, jellies, and jams. The
company’s corporate headquarters is located in Dallas, TX. Munson’s has one operations
center and seven regional distribution centers in the United States.

The company has two wholly owned subsidiaries that operate in Canada. The Canadian entity
owns an entity in France.

Munson’s plans to expand into Latin America by purchasing the last 25 percent of a
subsidiary that they own in Costa Rica. This process is expected to complete within the next
two years.

The company plans to implement Dynamics 365 Finance and Dynamics 365 Supply Chain to
meet their growing business needs.

Current environment. General

Munson’s uses a mix of internally-developed legacy systems that handle their finance and
distribution activities. The company has an isolated CRM system.

• Both Canadian subsidiaries have two departments: marketing and operations.

• Financial reporting is difficult due to data residing in disparate systems.
• Financial reporting is currently performed by using Microsoft Excel.
• Pre-orders in the current system are difficult to track because the order management
system is not integrated with the finance system.
• Pickle sales post to one revenue account, but this does not allow for targeted reporting
by pickle cut and type.

Current environment. Organization

The following chart shows Accounting/Reporting Currencies and Tax ID, if applicable.

• Typically, vendor invoices are received prior to receipt of product.

• The following fixed assets are sold for a loss:
1. BUILD-100
2. CAR-1233
• At the regional distribution centers, the value for physical inventory does not match
the inventory in the financial system.
• Munson’s rents their corporate office. Rent is not paid by purchase order. Rent is due
once a quarter.
• Allocations are performed manually.
• Barrels are inventoried by site and warehouse.
• Munson’s has multiple depreciation and tax books for all of their fixed asset
equipment.
 • Budgets are posted at the department level for each legal entity.

Requirements. Sales

• Customers should be able to pre-order for fall release of pickles.

• Three-way matching must be enforced for all purchases.
• Fixed asset sale transactions require a ledger account entered at the time of
transaction.
• Fixed assets purchased must be automatically created in fixed asset module. This
includes inventory items and write in purchase orders/non-inventoried items.
• One dollar from every sale must be tracked and donated at the end of each month to a
charitable organization.
• Purchasing budgets must be enforced at the main account level.

Requirements. Finances

• Accounts payable must be able to enter vendor invoices on the day they were received
to be settled against when product is received.
• Accounts payable must be able to enter vendor invoices to accrue expense without
specifying a purchase order at the time of entry.
• Postage expenses must be split evenly across the regional distribution centers
automatically.
• Administrative expenses must be distributed across the regional distribution centers
by percentage of fulfillment orders monthly.
• Pickling machines depreciation must be uniquely recorded for visibility but not post
to the ledger.

Issues

• During implementation testing, User1 indicates that after packing slips are generated
for purchase orders, there are no ledger postings.
• User2 indicates that fixed assets purchased on a purchase order do not show up in the
Fixed Assets module.
• User3 reports that they are seeing inconsistent application of the one-dollar donation
from all sales orders.
• User4 in the Canadian subsidiary is able to purchase supplies for marketing despite
exceeding the marketing department budget.
• User5 reports that when purchasing a non-inventoried computer, the system is
automatically assigning it to the buildings fixed asset group.

You need to determine the root cause for User1’s issue.

Which configuration options should you check? To answer, select the appropriate options in
the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="189" x2="425" y1="157" y2="180" ss="0" a="0" /><m x1="190"
x2="425" y1="241" y2="268" ss="0" a="0" /></map>
Explanation:
QUESTION NO: 94 DRAG DROP

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Munson’s Pickles and Preserves Farm grows and distributes produce, jellies, and jams. The
company’s corporate headquarters is located in Dallas, TX. Munson’s has one operations
center and seven regional distribution centers in the United States.

The company has two wholly owned subsidiaries that operate in Canada. The Canadian entity
owns an entity in France.

Munson’s plans to expand into Latin America by purchasing the last 25 percent of a
subsidiary that they own in Costa Rica. This process is expected to complete within the next
two years.

The company plans to implement Dynamics 365 Finance and Dynamics 365 Supply Chain to
meet their growing business needs.
Current environment. General

Munson’s uses a mix of internally-developed legacy systems that handle their finance and
distribution activities. The company has an isolated CRM system.

• Both Canadian subsidiaries have two departments: marketing and operations.

• Financial reporting is difficult due to data residing in disparate systems.
• Financial reporting is currently performed by using Microsoft Excel.
• Pre-orders in the current system are difficult to track because the order management
system is not integrated with the finance system.
• Pickle sales post to one revenue account, but this does not allow for targeted reporting
by pickle cut and type.

Current environment. Organization

The following chart shows Accounting/Reporting Currencies and Tax ID, if applicable.

• Typically, vendor invoices are received prior to receipt of product.

• The following fixed assets are sold for a loss:
1. BUILD-100
2. CAR-1233
• At the regional distribution centers, the value for physical inventory does not match
the inventory in the financial system.
• Munson’s rents their corporate office. Rent is not paid by purchase order. Rent is due
once a quarter.
• Allocations are performed manually.
• Barrels are inventoried by site and warehouse.
• Munson’s has multiple depreciation and tax books for all of their fixed asset
equipment.
• Budgets are posted at the department level for each legal entity.

Requirements. Sales

• Customers should be able to pre-order for fall release of pickles.

• Three-way matching must be enforced for all purchases.
• Fixed asset sale transactions require a ledger account entered at the time of
transaction.
• Fixed assets purchased must be automatically created in fixed asset module. This
includes inventory items and write in purchase orders/non-inventoried items.
• One dollar from every sale must be tracked and donated at the end of each month to a
charitable organization.
• Purchasing budgets must be enforced at the main account level.
Requirements. Finances

• Accounts payable must be able to enter vendor invoices on the day they were received
to be settled against when product is received.
• Accounts payable must be able to enter vendor invoices to accrue expense without
specifying a purchase order at the time of entry.
• Postage expenses must be split evenly across the regional distribution centers
automatically.
• Administrative expenses must be distributed across the regional distribution centers
by percentage of fulfillment orders monthly.
• Pickling machines depreciation must be uniquely recorded for visibility but not post
to the ledger.

Issues

• During implementation testing, User1 indicates that after packing slips are generated
for purchase orders, there are no ledger postings.
• User2 indicates that fixed assets purchased on a purchase order do not show up in the
Fixed Assets module.
• User3 reports that they are seeing inconsistent application of the one-dollar donation
from all sales orders.
• User4 in the Canadian subsidiary is able to purchase supplies for marketing despite
exceeding the marketing department budget.
• User5 reports that when purchasing a non-inventoried computer, the system is
automatically assigning it to the buildings fixed asset group.

You need to process expense allocations.

Which features should you use? To answer, drag the appropriate features to the correct
requirements. Each feature may be used once, more than once, or not at all. You may need to
drag the split bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="20" x2="211" y1="55" y2="86" ss="0" a="0" /><m x1="20"
x2="210" y1="96" y2="126" ss="0" a="0" /><m x1="20" x2="210" y1="138" y2="168"
ss="0" a="0" /><m x1="494" x2="684" y1="100" y2="130" ss="1" a="0" /><m x1="493"
x2="682" y1="161" y2="190" ss="1" a="0" /><c start="1" stop="0" /><c start="1" stop="1"
/></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/ledger-allocation-rules

QUESTION NO: 95

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Munson’s Pickles and Preserves Farm grows and distributes produce, jellies, and jams. The
company’s corporate headquarters is located in Dallas, TX. Munson’s has one operations
center and seven regional distribution centers in the United States.

The company has two wholly owned subsidiaries that operate in Canada. The Canadian entity
owns an entity in France.

Munson’s plans to expand into Latin America by purchasing the last 25 percent of a
subsidiary that they own in Costa Rica. This process is expected to complete within the next
two years.

The company plans to implement Dynamics 365 Finance and Dynamics 365 Supply Chain to
meet their growing business needs.

Current environment. General

Munson’s uses a mix of internally-developed legacy systems that handle their finance and
distribution activities. The company has an isolated CRM system.

• Both Canadian subsidiaries have two departments: marketing and operations.

• Financial reporting is difficult due to data residing in disparate systems.
• Financial reporting is currently performed by using Microsoft Excel.
• Pre-orders in the current system are difficult to track because the order management
system is not integrated with the finance system.
 • Pickle sales post to one revenue account, but this does not allow for targeted reporting
by pickle cut and type.

Current environment. Organization

The following chart shows Accounting/Reporting Currencies and Tax ID, if applicable.

• Typically, vendor invoices are received prior to receipt of product.

• The following fixed assets are sold for a loss:
1. BUILD-100
2. CAR-1233
• At the regional distribution centers, the value for physical inventory does not match
the inventory in the financial system.
• Munson’s rents their corporate office. Rent is not paid by purchase order. Rent is due
once a quarter.
• Allocations are performed manually.
• Barrels are inventoried by site and warehouse.
• Munson’s has multiple depreciation and tax books for all of their fixed asset
equipment.
• Budgets are posted at the department level for each legal entity.

Requirements. Sales

• Customers should be able to pre-order for fall release of pickles.

• Three-way matching must be enforced for all purchases.
• Fixed asset sale transactions require a ledger account entered at the time of
transaction.
• Fixed assets purchased must be automatically created in fixed asset module. This
includes inventory items and write in purchase orders/non-inventoried items.
• One dollar from every sale must be tracked and donated at the end of each month to a
charitable organization.
• Purchasing budgets must be enforced at the main account level.

Requirements. Finances

• Accounts payable must be able to enter vendor invoices on the day they were received
to be settled against when product is received.
• Accounts payable must be able to enter vendor invoices to accrue expense without
specifying a purchase order at the time of entry.
• Postage expenses must be split evenly across the regional distribution centers
automatically.
• Administrative expenses must be distributed across the regional distribution centers
by percentage of fulfillment orders monthly.
 • Pickling machines depreciation must be uniquely recorded for visibility but not post
to the ledger.

Issues

• During implementation testing, User1 indicates that after packing slips are generated
for purchase orders, there are no ledger postings.
• User2 indicates that fixed assets purchased on a purchase order do not show up in the
Fixed Assets module.
• User3 reports that they are seeing inconsistent application of the one-dollar donation
from all sales orders.
• User4 in the Canadian subsidiary is able to purchase supplies for marketing despite
exceeding the marketing department budget.
• User5 reports that when purchasing a non-inventoried computer, the system is
automatically assigning it to the buildings fixed asset group.

You need to configure system functionality for pickle type reporting.

What should you use?

A. item model groups

B. item groups
C. procurement category hierarchies
D. financial dimensions
E. procurement categories

Answer: B

QUESTION NO: 96

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.
At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Munson’s Pickles and Preserves Farm grows and distributes produce, jellies, and jams. The
company’s corporate headquarters is located in Dallas, TX. Munson’s has one operations
center and seven regional distribution centers in the United States.

The company has two wholly owned subsidiaries that operate in Canada. The Canadian entity
owns an entity in France.

Munson’s plans to expand into Latin America by purchasing the last 25 percent of a
subsidiary that they own in Costa Rica. This process is expected to complete within the next
two years.

The company plans to implement Dynamics 365 Finance and Dynamics 365 Supply Chain to
meet their growing business needs.

Current environment. General

Munson’s uses a mix of internally-developed legacy systems that handle their finance and
distribution activities. The company has an isolated CRM system.

• Both Canadian subsidiaries have two departments: marketing and operations.

• Financial reporting is difficult due to data residing in disparate systems.
• Financial reporting is currently performed by using Microsoft Excel.
• Pre-orders in the current system are difficult to track because the order management
system is not integrated with the finance system.
• Pickle sales post to one revenue account, but this does not allow for targeted reporting
by pickle cut and type.
Current environment. Organization

The following chart shows Accounting/Reporting Currencies and Tax ID, if applicable.

• Typically, vendor invoices are received prior to receipt of product.

• The following fixed assets are sold for a loss:
1. BUILD-100
2. CAR-1233
• At the regional distribution centers, the value for physical inventory does not match
the inventory in the financial system.
• Munson’s rents their corporate office. Rent is not paid by purchase order. Rent is due
once a quarter.
• Allocations are performed manually.
• Barrels are inventoried by site and warehouse.
• Munson’s has multiple depreciation and tax books for all of their fixed asset
equipment.
• Budgets are posted at the department level for each legal entity.

Requirements. Sales

• Customers should be able to pre-order for fall release of pickles.

• Three-way matching must be enforced for all purchases.
• Fixed asset sale transactions require a ledger account entered at the time of
transaction.
• Fixed assets purchased must be automatically created in fixed asset module. This
includes inventory items and write in purchase orders/non-inventoried items.
• One dollar from every sale must be tracked and donated at the end of each month to a
charitable organization.
• Purchasing budgets must be enforced at the main account level.

Requirements. Finances

• Accounts payable must be able to enter vendor invoices on the day they were received
to be settled against when product is received.
• Accounts payable must be able to enter vendor invoices to accrue expense without
specifying a purchase order at the time of entry.
• Postage expenses must be split evenly across the regional distribution centers
automatically.
• Administrative expenses must be distributed across the regional distribution centers
by percentage of fulfillment orders monthly.
• Pickling machines depreciation must be uniquely recorded for visibility but not post
to the ledger.
Issues

• During implementation testing, User1 indicates that after packing slips are generated
for purchase orders, there are no ledger postings.
• User2 indicates that fixed assets purchased on a purchase order do not show up in the
Fixed Assets module.
• User3 reports that they are seeing inconsistent application of the one-dollar donation
from all sales orders.
• User4 in the Canadian subsidiary is able to purchase supplies for marketing despite
exceeding the marketing department budget.
• User5 reports that when purchasing a non-inventoried computer, the system is
automatically assigning it to the buildings fixed asset group.

You need to configure the regional distribution centers.

Which three actions should you perform? Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. Configure a site
B. Associate the financial dimension to the site
C. Configure a financial dimension
D. Configure a legal entity
E. Associate the legal entity to the site

Answer: A, B, C

Reference:
https://exploredynamics365.home.blog/2020/10/05/ledger-allocations-in-microsoft-
dynamics-365-finance-and-operations-part-1/

QUESTION NO: 97 DRAG DROP

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.
To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Alpine Ski House has three partially owned franchises and 10 fully owned resorts throughout
the United States and Canada. Alpine Ski House’s percentage ownership of the franchises is
between two and 10 percent.

Alpine Ski House is undergoing an implementation of Dynamics 365 Finance and Dynamics
365 Supply Chain Management to transform their financial management and logistics
capabilities across the franchises. Implementation is complete for Alpine Ski House’s
corporate offices, two US franchises, and one Canadian franchise. The remaining franchises
are in varying stages of the implementation. Two new resort projects are in the budget
planning stages and will open in the next fiscal year.

Current environment

Organization and general ledger

• Each franchise is set up as a legal entity in Dynamics 365 Finance.

• Alpine Ski House Corporate uses financial dimensions for their fully owned resorts.
• Each resort is a financial dimension named resort.
• Each fully owned resort has two divisions: marketing and operations.
• Only Profit and Loss account postings require the division dimension.
• Corporate handles the advertising and administration of the fully owned resorts.
• Corporate uses Dynamics 365 Project Management and Accounting to manage
construction of new resorts.
Budgeting

• Organizational budgeting is decentralized but rolls up to one organizational corporate

budget.
• Each resort manager performs budgeting in Dynamics 365 Finance.
• Budget preparation begins this month. All operational resorts will submit their
budgets in two weeks.

Sales and tax

• Sales tax is configured and used by all resorts that operate in the United States.
• You configure one US sales tax vendor account and assign the vendor account to the
settlement periods for reporting.
• You use accounts receivable charges to track donations.

Existing purchasing contracts

• Each franchise resort has an individual contract with a local supplier of their choosing
to purchase at least $10,000 worth of suppliers during the calendar year.
• The franchise resorts in one US state receive a two percent discount on meat and
vegetable purchases in excess of $8,000 per year.
• A franchise resort in Utah has agreed to purchase 1,000 units of beef at market price
from a local supplier.
• Alpine Ski House uses a vendor collaboration portal to track purchase orders and
requests for quotes.
• Vendors request access to the vendor collaboration portal by using a workflow which
runs on a nightly schedule.

Intercompany setup

Vendor123 resides in US franchise Company1 and is set up for intercompany transactions.

Customer345 resides in Canada franchise Company1 and is set up for intercompany
transactions.

Requirements

Franchises

• Each franchise must pay two percent of monthly sales to Alpine Ski House Corporate.
• Each franchise must report their own financials to Alpine Ski House Corporate
monthly.
 • US franchises require a three-way-match on all purchases, with a 1-percent price
tolerance.
• Canadian franchises require a three-way-match on all purchases except paper
products, which have a 10-percent price tolerance.

Corporate

• Advertising costs must be balanced across the 10 resorts monthly. These costs must
be split across the 12 resorts once construction of the final two resorts is completed.
• Administration costs must be split across the 10 resorts proportional to the amount of
sales generated.
• One percent of all pack and individual ski pass sales must be donated quarterly to an
environmental protection organization.
• The finance department must be able to see purchasing contracts and discounts for
vendors based on volume spend.

Employees

All employee expense reports that contain the word entertainment must be reviewed for
audit purposes. If a journal is posted incorrectly, the entire journal and not just the incorrect
line must be fully reversed for audit purposes.

Resorts

All resorts must use Dynamics 365 Finance for budgeting and must first be approved by the
regional manager. Purchased fixed assets must automatically be acquired at product receipt.

Issues

• User1 reports that irrelevant dimensions display in the drop down when entering a
General journal.
• User2 reports that dimension 00 is being used for all balance sheet accounts.
• User3 tries to generate the quarterly sales tax liability payment for a specific state but
does not see any payables available for that state’s vendor.
• User4 receives a call from a vendor who cannot access the vendor collaboration portal
but needs immediate access.
• User5 notices a large amount of entertainment expenses being posted without an audit
review.
• User6 needs to have visibility into the increase in budget that is necessary to staff the
two new resorts opening next year.
• User7 needs to use Dynamics 365 Finance for situational budgeting planning with the
ability to increase and decrease the existing plans by certain percentages.
 • User8 made a mistake while posting a 1,000-line journal and reverses the entire
journal but cannot find the lines that included errors during the reversal.
• User9 made a mistake while posting a 55-line journal and reverses the entire journal.
• User10 realizes that the purchase of five new computers did not acquire five new
fixed assets upon receipt.

You need to configure ledger allocations to meet the requirements.

What should you configure? To answer, drag the appropriate setups to the correct
requirements. Each setup may be used once, more than once, or not at all. You may need to
drag the split bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="4" x2="246" y1="45" y2="85" ss="0" a="0" /><m x1="4" x2="250"
y1="95" y2="136" ss="0" a="0" /><m x1="258" x2="500" y1="44" y2="87" ss="0" a="0"
/><m x1="257" x2="501" y1="95" y2="139" ss="0" a="0" /><m x1="983" x2="1227"
y1="78" y2="120" ss="1" a="0" /><m x1="982" x2="1227" y1="128" y2="168" ss="1"
a="0" /><c start="1" stop="0" /><c start="2" stop="1" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/ledger-allocation-rules

QUESTION NO: 98

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Alpine Ski House has three partially owned franchises and 10 fully owned resorts throughout
the United States and Canada. Alpine Ski House’s percentage ownership of the franchises is
between two and 10 percent.

Alpine Ski House is undergoing an implementation of Dynamics 365 Finance and Dynamics
365 Supply Chain Management to transform their financial management and logistics
capabilities across the franchises. Implementation is complete for Alpine Ski House’s
corporate offices, two US franchises, and one Canadian franchise. The remaining franchises
are in varying stages of the implementation. Two new resort projects are in the budget
planning stages and will open in the next fiscal year.

Current environment

Organization and general ledger

• Each franchise is set up as a legal entity in Dynamics 365 Finance.

• Alpine Ski House Corporate uses financial dimensions for their fully owned resorts.
Each resort is a financial dimension named resort.
• Each fully owned resort has two divisions: marketing and operations.
• Only Profit and Loss account postings require the division dimension.
 • Corporate handles the advertising and administration of the fully owned resorts.
• Corporate uses Dynamics 365 Project Management and Accounting to manage
construction of new resorts.

Budgeting

• Organizational budgeting is decentralized but rolls up to one organizational corporate

budget.
• Each resort manager performs budgeting in Dynamics 365 Finance.
• Budget preparation begins this month. All operational resorts will submit their
budgets in two weeks.

Sales and tax

• Sales tax is configured and used by all resorts that operate in the United States.
• You configure one US sales tax vendor account and assign the vendor account to the
settlement periods for reporting.
• You use accounts receivable charges to track donations.

Existing purchasing contracts

• Each franchise resort has an individual contract with a local supplier of their choosing
to purchase at least $10,000 worth of suppliers during the calendar year.
• The franchise resorts in one US state receive a two percent discount on meat and
vegetable purchases in excess of $8,000 per year.
• A franchise resort in Utah has agreed to purchase 1,000 units of beef at market price
from a local supplier.
• Alpine Ski House uses a vendor collaboration portal to track purchase orders and
requests for quotes.
• Vendors request access to the vendor collaboration portal by using a workflow which
runs on a nightly schedule.

Intercompany setup

Vendor123 resides in US franchise Company1 and is set up for intercompany transactions.

Customer345 resides in Canada franchise Company1 and is set up for intercompany
transactions.

Requirements

Franchises

• Each franchise must pay two percent of monthly sales to Alpine Ski House Corporate.
 • Each franchise must report their own financials to Alpine Ski House Corporate
monthly.
• US franchises require a three-way-match on all purchases, with a 1-percent price
tolerance.
• Canadian franchises require a three-way-match on all purchases except paper
products, which have a 10-percent price tolerance.

Corporate

• Advertising costs must be balanced across the 10 resorts monthly. These costs must
be split across the 12 resorts once construction of the final two resorts is completed.
• Administration costs must be split across the 10 resorts proportional to the amount of
sales generated.
• One percent of all pack and individual ski pass sales must be donated quarterly to an
environmental protection organization.
• The finance department must be able to see purchasing contracts and discounts for
vendors based on volume spend.

Employees

All employee expense reports that contain the word entertainment must be reviewed for
audit purposes. If a journal is posted incorrectly, the entire journal and not just the incorrect
line must be fully reversed for audit purposes.

Resorts

All resorts must use Dynamics 365 Finance for budgeting and must first be approved by the
regional manager. Purchased fixed assets must automatically be acquired at product receipt.

Issues

• User1 reports that irrelevant dimensions display in the drop down when entering a
General journal.
User2 reports that dimension 00 is being used for all balance sheet accounts.
• User3 tries to generate the quarterly sales tax liability payment for a specific state but
does not see any payables available for that state’s vendor.
• User4 receives a call from a vendor who cannot access the vendor collaboration portal
but needs immediate access.
• User5 notices a large amount of entertainment expenses being posted without an audit
review.
• User6 needs to have visibility into the increase in budget that is necessary to staff the
two new resorts opening next year.
 • User7 needs to use Dynamics 365 Finance for situational budgeting planning with the
ability to increase and decrease the existing plans by certain percentages.
• User8 made a mistake while posting a 1,000-line journal and reverses the entire
journal but cannot find the lines that included errors during the reversal.
• User9 made a mistake while posting a 55-line journal and reverses the entire journal.
• User10 realizes that the purchase of five new computers did not acquire five new
fixed assets upon receipt.

You need to adjust the sales tax configuration to resolve the issue for User3.

What should you do?

A. Create multiple settlement periods and assign them to the US tax vendor.
B. Create multiple sales tax remittance vendors and assign them to the settlement period.
C. Run the payment proposal to generate the sales tax liability payments.
D. Create a state-specific settlement period and assign the US tax vendor to the settlement
period.

Answer: D

QUESTION NO: 99

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Alpine Ski House has three partially owned franchises and 10 fully owned resorts throughout
the United States and Canada. Alpine Ski House’s percentage ownership of the franchises is
between two and 10 percent.

Alpine Ski House is undergoing an implementation of Dynamics 365 Finance and Dynamics
365 Supply Chain Management to transform their financial management and logistics
capabilities across the franchises. Implementation is complete for Alpine Ski House’s
corporate offices, two US franchises, and one Canadian franchise. The remaining franchises
are in varying stages of the implementation. Two new resort projects are in the budget
planning stages and will open in the next fiscal year.

Current environment

Organization and general ledger

• Each franchise is set up as a legal entity in Dynamics 365 Finance.

• Alpine Ski House Corporate uses financial dimensions for their fully owned resorts.
• Each resort is a financial dimension named resort.
• Each fully owned resort has two divisions: marketing and operations.
• Only Profit and Loss account postings require the division dimension.
• Corporate handles the advertising and administration of the fully owned resorts.
• Corporate uses Dynamics 365 Project Management and Accounting to manage
construction of new resorts.

Budgeting

• Organizational budgeting is decentralized but rolls up to one organizational corporate

budget.
• Each resort manager performs budgeting in Dynamics 365 Finance.
• Budget preparation begins this month. All operational resorts will submit their
budgets in two weeks.

Sales and tax

 • Sales tax is configured and used by all resorts that operate in the United States.
• You configure one US sales tax vendor account and assign the vendor account to the
settlement periods for reporting.
• You use accounts receivable charges to track donations.

Existing purchasing contracts

• Each franchise resort has an individual contract with a local supplier of their choosing
to purchase at least $10,000 worth of suppliers during the calendar year.
• The franchise resorts in one US state receive a two percent discount on meat and
vegetable purchases in excess of $8,000 per year.
• A franchise resort in Utah has agreed to purchase 1,000 units of beef at market price
from a local supplier.
• Alpine Ski House uses a vendor collaboration portal to track purchase orders and
requests for quotes.
• Vendors request access to the vendor collaboration portal by using a workflow which
runs on a nightly schedule.

Intercompany setup

Vendor123 resides in US franchise Company1 and is set up for intercompany transactions.

Customer345 resides in Canada franchise Company1 and is set up for intercompany
transactions.

Requirements

Franchises

• Each franchise must pay two percent of monthly sales to Alpine Ski House Corporate.
• Each franchise must report their own financials to Alpine Ski House Corporate
monthly.
• US franchises require a three-way-match on all purchases, with a 1-percent price
tolerance.
• Canadian franchises require a three-way-match on all purchases except paper
products, which have a 10-percent price tolerance.

Corporate

• Advertising costs must be balanced across the 10 resorts monthly. These costs must
be split across the 12 resorts once construction of the final two resorts is completed.
• Administration costs must be split across the 10 resorts proportional to the amount of
sales generated.
 • One percent of all pack and individual ski pass sales must be donated quarterly to an
environmental protection organization.
• The finance department must be able to see purchasing contracts and discounts for
vendors based on volume spend.

Employees

All employee expense reports that contain the word entertainment must be reviewed for
audit purposes. If a journal is posted incorrectly, the entire journal and not just the incorrect
line must be fully reversed for audit purposes.

Resorts

All resorts must use Dynamics 365 Finance for budgeting and must first be approved by the
regional manager. Purchased fixed assets must automatically be acquired at product receipt.

Issues

• User1 reports that irrelevant dimensions display in the drop down when entering a
General journal.
• User2 reports that dimension 00 is being used for all balance sheet accounts.
• User3 tries to generate the quarterly sales tax liability payment for a specific state but
does not see any payables available for that state’s vendor.
• User4 receives a call from a vendor who cannot access the vendor collaboration portal
but needs immediate access.
• User5 notices a large amount of entertainment expenses being posted without an audit
review.
• User6 needs to have visibility into the increase in budget that is necessary to staff the
two new resorts opening next year.
• User7 needs to use Dynamics 365 Finance for situational budgeting planning with the
ability to increase and decrease the existing plans by certain percentages.
• User8 made a mistake while posting a 1,000-line journal and reverses the entire
journal but cannot find the lines that included errors during the reversal.
• User9 made a mistake while posting a 55-line journal and reverses the entire journal.
• User10 realizes that the purchase of five new computers did not acquire five new
fixed assets upon receipt.

You need to determine the cause of the issue that User1 reports.

What are two possible causes for the issue? Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. The account structure is in draft status.
B. The financial dimensions were created in the incorrect legal entity.
C. User1’s security is incorrectly set up.
D. The account structure has an asterisk for all dimensions.
E. The account structure has quotations for all dimensions.

Answer: D, E

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/configure-account-
structures

QUESTION NO: 100 HOTSPOT

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

First Up Consultants is a global finance and accounting company.

Financial needs at organizations are constantly changing. When global companies become
too large, it becomes too difficult for them to scale to meet their global operational needs.
First Up Consultants provides “Finance as a Service” capabilities.

Some large corporations complement their existing finance staff by engaging select services
of First Up Consultants. Other large corporations outsource their entire finance operation to
First Up Consultants.

First Up Consultants has hundreds of customers at any time. One such customer, Humongous
Insurance, is updating its Dynamics Finance 365 implementation. Another customer, Trey
Research, is setting up its first Dynamics 365 Finance implementation.

Current environment

Ledger

Humongous Insurance is a US-based company and operates its fiscal year from January 1 to
December 31. Humongous Insurance reports across all its subsidiaries in consolidated
financial reports.

Trey Research is a Canadian-based company that operates its fiscal year from April 1 to
March 31.

Humongous Insurance employees receive an annual cost of living increase.

Requirements

Ledger

• One of Humongous Insurance’s companies provides insurance to government clients

and must separate that particular company into its own subsidiary.
• The Humongous subsidiary will operate in China, which requires a fiscal year from
February 1 to January 31.
• Transactions must be posted in the business of record.
• Humongous Insurance’s subsidiary requires accounting entries to be posted from the
subledger to the general ledger by 5:00 PM each day.
• Trey Research requires accounting entries to be posted from the subledger to the
ledger immediately.

Fiscal calendars

You must create three new fiscal calendars:

 • A fiscal calendar named FebJan that runs from Feb 1 to Jan 31.
• A fiscal calendar named AprMar that runs from April 1 to March 31.
• A fiscal calendar named JanDec that runs from January 1 to December 31.

Accounts

• Trey Research must track bank account balances and transactions for each province in
which it operates.
• The bank statement must be sent to the physical address of the home office.

Promotion

• Humongous Insurance’s subsidiary plans to celebrate its new subsidiary status by

sending out free gifts to existing policyholders based on the tier of their policy.
• Promotional items are ordered for distribution and once received must be tracked
within Dynamics 365 Finance.

Taxes

• As part of the spinoff to a subsidiary, Humongous Insurance’s subsidiaries taxes must

be changed from US government rates to Chinese government rates.
• Humongous Insurance’s subsidiary must track use taxes that are not claimed or
reported to the Chinese tax agency.

Reporting

• The CEO of Humongous Insurance needs to view the insurance products that
customers plan to purchase. The report must show all transactions made over the last
two years.
• The corporate vice president of Humongous Insurance’s subsidiary needs to view the
forecasted cash impact of specific products purchased. The report must show only
new transactions.

Expenses

Expenses must be paid using the following requirements:

Credit card processing

• Humongous Insurance requires al credit card transactions to include line-item details.

• Humongous Insurance’s subsidiary requires the shipping address, merchant address,
and tax information, but cannot include any order line details.
• Trey Research requires all credit card transactions include transaction date,
transaction amount, description, and line-item details.

Compliance and compensation

• Trey Research must be able to audit any modifications to its budget.

• Humongous Insurance employees must receive raises four times per budget cycle.

You need to configure the fiscal year calendars for each legal entity.

How should you configure the fiscal year calendars? To answer, select the appropriate
options in the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="306" x2="417" y1="112" y2="138" ss="0" a="0" /><m x1="306"
x2="417" y1="255" y2="278" ss="0" a="0" /><m x1="306" x2="415" y1="394" y2="419"
ss="0" a="0" /></map>
Explanation:
Box 1: JanDec
Humongous Insurance is a US-based company and operates its fiscal year from January 1 to
December 31.

Note: You must create three new fiscal calendars:

• A fiscal calendar named FebJan that runs from Feb 1 to Jan 31.
• A fiscal calendar named AprMar that runs from April 1 to March 31.
• A fiscal calendar named JanDec that runs from January 1 to December 31.

Box 2: FebJan
The Humongous subsidiary will operate in China, which requires a fiscal year from February
1 to January 31.

Box 3: AprMar
Trey Research is a Canadian-based company that operates its fiscal year from April 1 to
March 31.

QUESTION NO: 101 HOTSPOT

Case study
This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

First Up Consultants is a global finance and accounting company.

Financial needs at organizations are constantly changing. When global companies become
too large, it becomes too difficult for them to scale to meet their global operational needs.
First Up Consultants provides “Finance as a Service” capabilities.

Some large corporations complement their existing finance staff by engaging select services
of First Up Consultants. Other large corporations outsource their entire finance operation to
First Up Consultants.

First Up Consultants has hundreds of customers at any time. One such customer, Humongous
Insurance, is updating its Dynamics Finance 365 implementation. Another customer, Trey
Research, is setting up its first Dynamics 365 Finance implementation.

Current environment

Ledger
Humongous Insurance is a US-based company and operates its fiscal year from January 1 to
December 31. Humongous Insurance reports across all its subsidiaries in consolidated
financial reports.

Trey Research is a Canadian-based company that operates its fiscal year from April 1 to
March 31.

Humongous Insurance employees receive an annual cost of living increase.

Requirements

Ledger

• One of Humongous Insurance’s companies provides insurance to government clients

and must separate that particular company into its own subsidiary.
• The Humongous subsidiary will operate in China, which requires a fiscal year from
February 1 to January 31.
• Transactions must be posted in the business of record.
• Humongous Insurance’s subsidiary requires accounting entries to be posted from the
subledger to the general ledger by 5:00 PM each day.
• Trey Research requires accounting entries to be posted from the subledger to the
ledger immediately.

Fiscal calendars

You must create three new fiscal calendars:

• A fiscal calendar named FebJan that runs from Feb 1 to Jan 31.
• A fiscal calendar named AprMar that runs from April 1 to March 31.
• A fiscal calendar named JanDec that runs from January 1 to December 31.

Accounts

• Trey Research must track bank account balances and transactions for each province in
which it operates.
• The bank statement must be sent to the physical address of the home office.

Promotion

• Humongous Insurance’s subsidiary plans to celebrate its new subsidiary status by

sending out free gifts to existing policyholders based on the tier of their policy.
• Promotional items are ordered for distribution and once received must be tracked
within Dynamics 365 Finance.
Taxes

• As part of the spinoff to a subsidiary, Humongous Insurance’s subsidiaries taxes must

be changed from US government rates to Chinese government rates.
• Humongous Insurance’s subsidiary must track use taxes that are not claimed or
reported to the Chinese tax agency.

Reporting

• The CEO of Humongous Insurance needs to view the insurance products that
customers plan to purchase. The report must show all transactions made over the last
two years.
• The corporate vice president of Humongous Insurance’s subsidiary needs to view the
forecasted cash impact of specific products purchased. The report must show only
new transactions.

Expenses

Expenses must be paid using the following requirements:

Credit card processing

• Humongous Insurance requires al credit card transactions to include line-item details.

• Humongous Insurance’s subsidiary requires the shipping address, merchant address,
and tax information, but cannot include any order line details.
 • Trey Research requires all credit card transactions include transaction date,
transaction amount, description, and line-item details.

Compliance and compensation

• Trey Research must be able to audit any modifications to its budget.

• Humongous Insurance employees must receive raises four times per budget cycle.

You need to configure the cash flow management reports.

How should you configure cash flow management? To answer, select the appropriate options
in the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="413" x2="523" y1="113" y2="138" ss="0" a="0" /><m x1="413"
x2="524" y1="253" y2="278" ss="0" a="0" /></map>
Explanation:
Box 1: Total
Reporting: The CEO of Humongous Insurance needs to view the insurance products that
customers plan to purchase. The report must show all transactions made over the last two
years.
Humongous Insurance reports across all its subsidiaries in consolidated financial reports.

Calculate the cash flow forecast by using the Calculate cash flow forecasts page. You can
calculate either the full cash flow forecast or an incremental cash flow forecast.

* To clear all cash flow forecast transactions and recalculate, set the Cash flow forecast
calculation method field to Total. We recommend that you use this approach if you haven't
updated the cash flow forecasts for a long time.

Box 2: New
Reporting: The corporate vice president of Humongous Insurance’s subsidiary needs to view
the forecasted cash impact of specific products purchased. The report must show only new
transactions.

To update the existing cash flow information for new transactions only, set the Cash flow
forecast calculation method field to New. The page will show the date when your cash flow
calculation was last run.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/cash-bank-
management/cash-flow-forecasting

QUESTION NO: 102

Case study
This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

First Up Consultants is a global finance and accounting company.

Financial needs at organizations are constantly changing. When global companies become
too large, it becomes too difficult for them to scale to meet their global operational needs.
First Up Consultants provides “Finance as a Service” capabilities.

Some large corporations complement their existing finance staff by engaging select services
of First Up Consultants. Other large corporations outsource their entire finance operation to
First Up Consultants.

First Up Consultants has hundreds of customers at any time. One such customer, Humongous
Insurance, is updating its Dynamics Finance 365 implementation. Another customer, Trey
Research, is setting up its first Dynamics 365 Finance implementation.

Current environment

Ledger
Humongous Insurance is a US-based company and operates its fiscal year from January 1 to
December 31. Humongous Insurance reports across all its subsidiaries in consolidated
financial reports.

Trey Research is a Canadian-based company that operates its fiscal year from April 1 to
March 31.

Humongous Insurance employees receive an annual cost of living increase.

Requirements

Ledger

• One of Humongous Insurance’s companies provides insurance to government clients

and must separate that particular company into its own subsidiary.
• The Humongous subsidiary will operate in China, which requires a fiscal year from
February 1 to January 31.
• Transactions must be posted in the business of record.
• Humongous Insurance’s subsidiary requires accounting entries to be posted from the
subledger to the general ledger by 5:00 PM each day.
• Trey Research requires accounting entries to be posted from the subledger to the
ledger immediately.

Fiscal calendars

You must create three new fiscal calendars:

• A fiscal calendar named FebJan that runs from Feb 1 to Jan 31.
• A fiscal calendar named AprMar that runs from April 1 to March 31.
• A fiscal calendar named JanDec that runs from January 1 to December 31.

Accounts

• Trey Research must track bank account balances and transactions for each province in
which it operates.
• The bank statement must be sent to the physical address of the home office.

Promotion

• Humongous Insurance’s subsidiary plans to celebrate its new subsidiary status by

sending out free gifts to existing policyholders based on the tier of their policy.
• Promotional items are ordered for distribution and once received must be tracked
within Dynamics 365 Finance.
Taxes

• As part of the spinoff to a subsidiary, Humongous Insurance’s subsidiaries taxes must

be changed from US government rates to Chinese government rates.
• Humongous Insurance’s subsidiary must track use taxes that are not claimed or
reported to the Chinese tax agency.

Reporting

• The CEO of Humongous Insurance needs to view the insurance products that
customers plan to purchase. The report must show all transactions made over the last
two years.
• The corporate vice president of Humongous Insurance’s subsidiary needs to view the
forecasted cash impact of specific products purchased. The report must show only
new transactions.

Expenses

Expenses must be paid using the following requirements:

Credit card processing

• Humongous Insurance requires al credit card transactions to include line-item details.

• Humongous Insurance’s subsidiary requires the shipping address, merchant address,
and tax information, but cannot include any order line details.
 • Trey Research requires all credit card transactions include transaction date,
transaction amount, description, and line-item details.

Compliance and compensation

• Trey Research must be able to audit any modifications to its budget.

• Humongous Insurance employees must receive raises four times per budget cycle.

You need to reconfigure the taxing jurisdiction for Humongous Insurance’s subsidiary.

What should you do?

A. Configure sales tax groups for transactions that occur in China.

B. Change the reporting currency.
C. Configure dual currency support for sales tax.
D. Change the sales tax settlement period authority.

Answer: D
Explanation:
Sales tax authorities are entities to which collected sales tax needs to be reported and paid.
You can pay sales taxes to the authority directly or through a vendor account that you create
for the sales tax authority. If you do this, the company can use its usual payment routines to
pay the sales tax authority on time. If you do not set up the tax authority as a vendor,
someone must prepare a manual payment to the tax authority on the appropriate due date.

Note: Taxes
As part of the spinoff to a subsidiary, Humongous Insurance’s subsidiaries taxes must be
changed from US government rates to Chinese government rates.
Humongous Insurance’s subsidiary must track use taxes that are not claimed or reported to
the Chinese tax agency.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/tasks/set-
up-sales-tax-authorities

Topic 2, Implement accounts receivable, credit, collections, and reve-

nue recognition

QUESTION NO: 103 DRAG DROP

A client observes that some customers are late paying their invoices. The client wants to use
the Credit and Collections functionality to send collection letters to customers.

You need to configure the system to support collection letter functionality and processing.

In which order should you perform the actions? To answer, move all actions from the list of
actions to the answer area and arrange them in the correct order.

Answer: <map><m x1="8" x2="325" y1="40" y2="80" ss="0" a="0" /><m x1="7" x2="323"
y1="90" y2="132" ss="0" a="0" /><m x1="8" x2="324" y1="141" y2="182" ss="0" a="0"
/><m x1="8" x2="323" y1="193" y2="232" ss="0" a="0" /><m x1="8" x2="324" y1="240"
y2="282" ss="0" a="0" /><m x1="392" x2="797" y1="38" y2="85" ss="1" a="0" /><m
x1="392" x2="796" y1="88" y2="132" ss="1" a="0" /><m x1="393" x2="795" y1="135"
y2="182" ss="1" a="0" /><m x1="393" x2="794" y1="187" y2="234" ss="1" a="0" /><m
x1="392" x2="795" y1="239" y2="281" ss="1" a="0" /><c start="2" stop="0" /><c start="3"
stop="1" /><c start="1" stop="2" /><c start="4" stop="3" /><c start="0" stop="4" /></map>
Explanation:

Reference:
http://d365tour.com/en/microsoft-dynamics-d365o/finance-d365fo-en/collection-letters/

QUESTION NO: 104 HOTSPOT

A company sells goods to a customer. You enter an invoice for the customer on June 25. The
invoice is eligible for a cash discount of two percent if it is paid in five days, and a discount
of one percent if it paid in 14 days.

You need to create a payment journal when the invoices are settled on specific dates.

Which setup options should you use? To answer, select the appropriate options in the answer
area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="227" x2="731" y1="126" y2="147" ss="0" a="0" /><m x1="226"
x2="731" y1="224" y2="246" ss="0" a="0" /></map>
Explanation:
QUESTION NO: 105 HOTSPOT

A private sector client needs item groups set up to support the procurement process.

The Audio Item group posting for a purchase order is configured as shown:

Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.
NOTE: Each correct selection is worth one point.

Answer: <map><m x1="541" x2="1043" y1="218" y2="251" ss="0" a="0" /><m x1="539"
x2="855" y1="295" y2="327" ss="0" a="0" /></map>
Explanation:

QUESTION NO: 106

A client uses Dynamics 365 Finance for accounts receivable.

You need to configure the method of payment to enforce the accounts receivable clerk to
enter the wire number for the received electronic payment.

Which item should you set up as mandatory?

A. Select bank transaction type

B. Select payment reference
C. Select Payment ID
D. Select Deposit slip
Answer: B

QUESTION NO: 107 HOTSPOT

A company has delinquent customers.

You need to configure Dynamics 365 Finance to meet the following requirements:

• Send communication to the customers detailing their past-due invoices.

• Use the system to automatically calculate a late charges.
• Create a group of customers for a collection agent to monitor.
• View a list of customers with colored indicators of a customer’s payment status.

You need to associate the correct system functionality to manage delinquent customers based
on these business requirements.

Which functionality should you use? To answer, select the appropriate configuration in the
answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="359" x2="634" y1="128" y2="148" ss="0" a="0" /><m x1="360"
x2="635" y1="269" y2="290" ss="0" a="0" /><m x1="359" x2="636" y1="344" y2="365"
ss="0" a="0" /><m x1="361" x2="635" y1="482" y2="501" ss="0" a="0" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/accounts-
receivable/tasks/review-collections-information

QUESTION NO: 108 HOTSPOT

A client confirms a sales order in Dynamics 365 Finance.

You are viewing the confirmed sales order.

Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="43" x2="320" y1="110" y2="136" ss="0" a="0" /><m x1="44"
x2="598" y1="237" y2="260" ss="0" a="0" /></map>
Explanation:

QUESTION NO: 109 DRAG DROP

An organization sells monthly service subscriptions. The organization sends invoices to

customers on the 15th of every month in the amount of $450.00.
You need to set up, configure, and process recurring free text invoices for the customers.

In which order should you perform the actions? To answer, move all actions from the list of
actions to the answer area and arrange them in the correct order.

Answer: <map><m x1="11" x2="326" y1="34" y2="90" ss="0" a="0" /><m x1="9"
x2="325" y1="97" y2="156" ss="0" a="0" /><m x1="10" x2="325" y1="162" y2="222"
ss="0" a="0" /><m x1="10" x2="326" y1="225" y2="281" ss="0" a="0" /><m x1="8"
x2="326" y1="287" y2="345" ss="0" a="0" /><m x1="395" x2="801" y1="32" y2="93"
ss="1" a="0" /><m x1="393" x2="801" y1="96" y2="157" ss="1" a="0" /><m x1="393"
x2="801" y1="162" y2="224" ss="1" a="0" /><m x1="393" x2="800" y1="228" y2="283"
ss="1" a="0" /><m x1="394" x2="797" y1="288" y2="345" ss="1" a="0" /><c start="3"
stop="0" /><c start="0" stop="1" /><c start="2" stop="2" /><c start="1" stop="3" /><c
start="4" stop="4" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/accounts-
receivable/set-up-process-recurring-invoices

QUESTION NO: 110

A company has many customers who are not paying invoices on time.

You need to use the collection letter functionality to manage customer delinquencies.

What are two possible ways to achieve the goal? Each correct answer presents part of the
solution.

NOTE: Each correct selection is worth one point.

A. Cancel the collection letters after they are created and posted.
B. Print all of the collection letters.
C. Delete the collection letters after posting when an error occurs.
D. Post the collection letters.

Answer: B, D

Reference:
http://d365tour.com/en/microsoft-dynamics-d365o/finance-d365fo-en/collection-letters/

QUESTION NO: 111

A company plans to allocate revenue across occurrences by using recognition basis.

Which recognition basis can you use?

A. Mid-month split
B. Revenue schedule
C. Actual start date
D. Monthly

Answer: D

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/accounts-receivable/revenue-
recognition-setup

QUESTION NO: 112 HOTSPOT

A client is using Dynamics 365 Finance for sales order processing and accounts receivable.
The client has two customer groups and two Accounts receivable trade accounts. Foreign
customers in Group 80 are assigned to account 12001. Domestic customers in Group 40 are
assigned to account 12000.

You are viewing the client's current setup of Customer posting profiles.
Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="451" x2="940" y1="170" y2="220" ss="0" a="0" /><m x1="450"
x2="940" y1="346" y2="398" ss="0" a="0" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/accounts-receivable/customer-
posting-profiles

QUESTION NO: 113 SIMULATION

You are a functional consultant for Contoso Entertainment System USA (USMF).

You plan to run several reports in USMF that list all the write-off transactions.

You need to replace the write-off reason used by the system for USMF to use a reason of
“Bad debts.

To complete this task, sign in to the Dynamics 365 portal.

Answer: See explanation below.

Explanation:

You need to add a write-off reason for USMF and set it as the default.

1. Go to Navigation pane > Modules > Credit and collections > Setup > Accounts
receivable parameters.
2. Click the Collections tab.
3. Click the Edit icon in the Write-Off section.
4. Add a new Write-Off reason if it doesn’t exist.
5. Tick the “Default” checkbox next to the new Write-Off reason.
6. Click the Save button to save the changes.

QUESTION NO: 114

A company signs a four-year contract for an IT support project. The manager wants to know
how the revenue amounts will be allocated across the four-year period.

You need to implement a revenue schedule to determine the revenue amounts for each
month.

Which setup should you use?

A. 60 months
B. 48 months
C. 4 years
D. 4 months

Answer: B
Explanation:
Revenue schedules
A revenue schedule must be created for each occurrence that revenue can be deferred for. For
example, if your organization offers support over six-month, 12-month, 18-month, and 24-
month periods, you must create a revenue schedule for each period.
Reference: https://docs.microsoft.com/en-us/dynamics365/finance/accounts-
receivable/revenue-recognition-setup

QUESTION NO: 115 DRAG DROP

You have implemented Dynamics 365 Finance.

You must configure revenue recognition to handle deferring revenue and revenue
reallocation.

You need to configure the posting profile.

What should you do? To answer, drag the appropriate posting profiles to the correct scenario.
Each posting profile may be used once, more than once, or not at all. You may need to drag
the split bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="11" x2="296" y1="41" y2="86" ss="0" a="0" /><m x1="10"
x2="292" y1="93" y2="137" ss="0" a="0" /><m x1="9" x2="297" y1="144" y2="186"
ss="0" a="0" /><m x1="615" x2="901" y1="83" y2="126" ss="1" a="0" /><m x1="615"
x2="900" y1="152" y2="199" ss="1" a="0" /><c start="0" stop="0" /><c start="2" stop="1"
/></map>
Explanation:

Box 1: Deferred revenue

Deferred revenue – Enter the main account for the revenue price that posts to deferred
revenue (instead of revenue). The revenue price is deferred if the sales order line has a
revenue schedule.
Box 2: Partial invoice revenue clearing
Partial invoice revenue clearing – Enter the main account for the clearing account that is used
either when the sales order is partially invoiced or when reallocation occurs. The balance in
this account returns to 0 (zero) when the sales orders are fully invoiced.

Incorrect:
Deferred cost of goods sold – Enter the main account for the cost of goods sold amount that
posts to deferred cost of goods sold if the revenue is also deferred.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/accounts-
receivable/revenue-recognition-setup

QUESTION NO: 116

A company plans to allocate revenue across occurrences by using recognition basis.

Which recognition basis can you use?

A. Median price
B. Revenue schedule
C. First of next month
D. Monthly

Answer: D
Explanation:
Recognition basis – The recognition basis determines how the revenue price is allocated
across the occurrences.
* Monthly – The amount is allocated equally across the number of months that is defined in
the Monthly by days – The amount is allocated based on the actual days in each calendar
month. occurrences.
* Etc.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/accounts-
receivable/revenue-recognition-setup

QUESTION NO: 117 DRAG DROP

You manage customer credit and collections in a Dynamics 365 Finance implementation.

At the beginning of each month, you must send collection letters to customers whose
payments are overdue.
You need to configure the collection letter functionality.

Which four actions should you perform in sequence? To answer, move the appropriate
actions from the list of actions to the answer area and arrange them in the correct order.

Answer: <map><m x1="2" x2="547" y1="25" y2="65" ss="0" a="0" /><m x1="3" x2="545"
y1="73" y2="113" ss="0" a="0" /><m x1="3" x2="547" y1="120" y2="159" ss="0" a="0"
/><m x1="2" x2="548" y1="165" y2="207" ss="0" a="0" /><m x1="3" x2="545" y1="213"
y2="254" ss="0" a="0" /><m x1="559" x2="1101" y1="24" y2="66" ss="1" a="0" /><m
x1="559" x2="1100" y1="76" y2="116" ss="1" a="0" /><m x1="559" x2="1099" y1="123"
y2="164" ss="1" a="0" /><m x1="559" x2="1100" y1="171" y2="213" ss="1" a="0" /><c
start="4" stop="0" /><c start="3" stop="1" /><c start="0" stop="2" /><c start="1" stop="3"
/></map>
Explanation:

Step 1: Define the collection letter sequence.

Set up a collection letter sequence on the posting profile

Step 2: Link the collection letter sequence to a customer profile.

Step 3: Post the collection letter.

See step 9 below.
Print collection letters
1. Go to navigation pane > Modules > Credit and collections > Collection letter >
Review and process collection letters.

2. In the Status field, select Created.

 3. In the Printed field, select Not printed.

4. Select Print.

5. Select Collection letter note.

6. In the Parameters section, enter the cutoff date for postings.

7. Expand the Records to include section and enter the details of the Collection letter
note.

8. Select OK to print the collection letter.

9. Post the collection letter. Etc.

Step 4: Generate the collection letter.

Each collection letter is also associated with a collection letter code. The collection letter
code is associated with individual transactions and is used to determine when the next
collection letter should be generated for each transaction. For example, if a transaction is
more than 30 days overdue, the collection letter code determines that the next collection letter
will be sent when the transaction becomes 60 days overdue, if it isn't paid before then.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/accounts-
receivable/tasks/process-collection-letters

QUESTION NO: 118 DRAG DROP

A company that sells computer equipment uses Microsoft Dynamics 365 Finance. The
company is creating bundles that include a computer and a three-year warranty.

The company configures revenue recognition.

You need to configure revenue types for the bundle components.

Which revenue type should you use? To answer, drag the appropriate revenue types to the
correct components. Each revenue type may be used once, more than once, or not at all. You
may need to drag the split bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="10" x2="265" y1="43" y2="86" ss="0" a="0" /><m x1="10"
x2="263" y1="94" y2="137" ss="0" a="0" /><m x1="11" x2="268" y1="145" y2="188"
ss="0" a="0" /><m x1="470" x2="725" y1="70" y2="114" ss="1" a="0" /><m x1="470"
x2="728" y1="141" y2="185" ss="1" a="0" /><c start="0" stop="0" /><c start="2" stop="1"
/></map>
Explanation:

Box 1: Essential
Essential – The item is a primary source of an organization's revenue. This value is the
default setting.

Box 2: Post contract support (PCS)

Post contract support – The item supports other elements that are included in the sale to the
customer. The revenue price is distributed across the essential and nonessential products that
are included in the sale. Depending on setup, PCS items might not require that contract start
and end dates be defined on the sales order line.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/accounts-
receivable/revenue-recognition-setup

QUESTION NO: 119

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.
To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Fourth Coffee is a coffee and supplies manufacturer based in Seattle. The company recently
purchased CompanyA, based in the United States, and CompanyB, based in Canada, in order
to increase production of their award-winning espresso machine and distribution of their dark
roast coffee beans, respectively.

Fourth Coffee has set up CompanyA and CompanyB in their Dynamics 365 Finance to gain
better visibility into the companies’ profitability. CompanyA and CompanyB will continue to
operate as subsidiaries of Fourth Coffee, but all operational companies will be consolidated
under Fourth Coffee Holding Company in US dollars (USD) for reporting purposes.

The current organizational chart is shown below:

Current environment

Systemwide setup
 • Dynamics 365 Finance in Microsoft Azure is used to manage the supply chain, retail,
and financials.
• All companies share a Chart of Accounts.
• Two dimensions are used: Department and Division.
• Budgeting is controlled at the department level.
• Customers and vendors are defined as two groups: Domestic and International.
• Mandatory credit check is set to No.
• Consolidate online is used for the consolidation of all companies.
• International main accounts are subject to foreign currency revaluation.
• The purchasing budget is used to enforce purchasing limits.

General ledger accounts

Fourth Coffee

• The base currency is USD.

• Three item groups are used: coffee, supplies, and nonstock.
• The standard sales tax method is used.
• Acquiring fixed assets requires a purchase order.
• All customer payment journals require a deposit slip.
• CustomerX is a taxable company.
• CustomerY is a tax-exempt company.
• CustomerZ is a taxable company.
• VendorA is a Colombian supplier of coffee beans and belongs to the international
vendor group.
• VendorB is a Peruvian supplier of coffee machine filters and belongs to the
international vendor group.
• VendorC is a Texas supplier of espresso valves and belongs to the domestic vendor
group.

CompanyA

• The base currency is USD.

• It consists of a marketing department and a digital division.
• A 4-5-4 calendar structure is used.
• The standard sales tax method is used.
CompanyB

• The base currency is CAD.

• The conditional sales tax method is used.

Requirements

Reporting

• A consolidated Fourth Coffee financial report is required in USD currency.

• Fourth Coffee and its subsidiaries need to be able to report sales by item type.
• Year-end adjustments need to be reported separately in a different period to view
financial reporting inclusive and exclusive of year-end adjustments.

Issues

• User1 observes that a General journal was used in error to post to the Domestic
Accounts Receivable trade account.
• User2 has to repeatedly reclassify vendor invoice journals in Fourth Coffee Company
that are posted to the marketing department and digital division.
• When User3 posts an Accounts receivable payment journal, a deposit slip is not
generated.
• User4 observes an increase in procurement department expenses for supplies.
• User5 observes that sales tax is not calculating on a sales order for CustomerZ.
• User6 observes that sales tax is calculating for CustomerY.
• User7 observes that the sales tax payment report is excluding posted invoice
transactions.
• User8 in CompanyA attempts to set up the sales tax receivable account on the sales
tax posting form.
• User9 in CompanyA needs to purchase three tablets by using a purchase order and
record the devices as fixed assets.
• CustomerX requires a credit check when making a purchase and is currently at their
credit limit.

You need to determine why CustomerX is unable to confirm another sales order.

What are two possible reasons? Each answer is a complete solution.

NOTE: Each correct selection is worth one point.

A. The credit limit parameter is set to Balance + All.

B. The credit limit is set to 0.
C. An inventory item is out of stock.
D. The inventory safety stock is set to 0.

Answer: A, C

QUESTION NO: 120

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Munson’s Pickles and Preserves Farm grows and distributes produce, jellies, and jams. The
company’s corporate headquarters is located in Dallas, TX. Munson’s has one operations
center and seven regional distribution centers in the United States.

The company has two wholly owned subsidiaries that operate in Canada. The Canadian entity
owns an entity in France.
Munson’s plans to expand into Latin America by purchasing the last 25 percent of a
subsidiary that they own in Costa Rica. This process is expected to complete within the next
two years.

The company plans to implement Dynamics 365 Finance and Dynamics 365 Supply Chain to
meet their growing business needs.

Current environment. General

Munson’s uses a mix of internally-developed legacy systems that handle their finance and
distribution activities. The company has an isolated CRM system.

• Both Canadian subsidiaries have two departments: marketing and operations.

• Financial reporting is difficult due to data residing in disparate systems.
• Financial reporting is currently performed by using Microsoft Excel.
• Pre-orders in the current system are difficult to track because the order management
system is not integrated with the finance system.
• Pickle sales post to one revenue account, but this does not allow for targeted reporting
by pickle cut and type.

Current environment. Organization

The following chart shows Accounting/Reporting Currencies and Tax ID, if applicable.

• Typically, vendor invoices are received prior to receipt of product.

• The following fixed assets are sold for a loss:
1. BUILD-100
2. CAR-1233
• At the regional distribution centers, the value for physical inventory does not match
the inventory in the financial system.
• Munson’s rents their corporate office. Rent is not paid by purchase order. Rent is due
once a quarter.
• Allocations are performed manually.
• Barrels are inventoried by site and warehouse.
• Munson’s has multiple depreciation and tax books for all of their fixed asset
equipment.
• Budgets are posted at the department level for each legal entity.

Requirements. Sales

• Customers should be able to pre-order for fall release of pickles.

• Three-way matching must be enforced for all purchases.
 • Fixed asset sale transactions require a ledger account entered at the time of
transaction.
• Fixed assets purchased must be automatically created in fixed asset module. This
includes inventory items and write in purchase orders/non-inventoried items.
• One dollar from every sale must be tracked and donated at the end of each month to a
charitable organization.
• Purchasing budgets must be enforced at the main account level.

Requirements. Finances

• Accounts payable must be able to enter vendor invoices on the day they were received
to be settled against when product is received.
• Accounts payable must be able to enter vendor invoices to accrue expense without
specifying a purchase order at the time of entry.
• Postage expenses must be split evenly across the regional distribution centers
automatically.
• Administrative expenses must be distributed across the regional distribution centers
by percentage of fulfillment orders monthly.
• Pickling machines depreciation must be uniquely recorded for visibility but not post
to the ledger.

Issues

• During implementation testing, User1 indicates that after packing slips are generated
for purchase orders, there are no ledger postings.
• User2 indicates that fixed assets purchased on a purchase order do not show up in the
Fixed Assets module.
• User3 reports that they are seeing inconsistent application of the one-dollar donation
from all sales orders.
• User4 in the Canadian subsidiary is able to purchase supplies for marketing despite
exceeding the marketing department budget.
• User5 reports that when purchasing a non-inventoried computer, the system is
automatically assigning it to the buildings fixed asset group.

You need to recommend a solution to prevent User3's issue from recurring.

What should you recommend?

A. Configure automatic charge codes.

B. Create a service item.
C. Configure a sales order template.
D. Create a procurement category.
Answer: A

QUESTION NO: 121

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Munson’s Pickles and Preserves Farm grows and distributes produce, jellies, and jams. The
company’s corporate headquarters is located in Dallas, TX. Munson’s has one operations
center and seven regional distribution centers in the United States.

The company has two wholly owned subsidiaries that operate in Canada. The Canadian entity
owns an entity in France.

Munson’s plans to expand into Latin America by purchasing the last 25 percent of a
subsidiary that they own in Costa Rica. This process is expected to complete within the next
two years.
The company plans to implement Dynamics 365 Finance and Dynamics 365 Supply Chain to
meet their growing business needs.

Current environment. General

Munson’s uses a mix of internally-developed legacy systems that handle their finance and
distribution activities. The company has an isolated CRM system.

• Both Canadian subsidiaries have two departments: marketing and operations.

• Financial reporting is difficult due to data residing in disparate systems.
• Financial reporting is currently performed by using Microsoft Excel.
• Pre-orders in the current system are difficult to track because the order management
system is not integrated with the finance system.
• Pickle sales post to one revenue account, but this does not allow for targeted reporting
by pickle cut and type.

Current environment. Organization

The following chart shows Accounting/Reporting Currencies and Tax ID, if applicable.

• Typically, vendor invoices are received prior to receipt of product.

• The following fixed assets are sold for a loss:
1. BUILD-100
2. CAR-1233
• At the regional distribution centers, the value for physical inventory does not match
the inventory in the financial system.
• Munson’s rents their corporate office. Rent is not paid by purchase order. Rent is due
once a quarter.
• Allocations are performed manually.
• Barrels are inventoried by site and warehouse.
• Munson’s has multiple depreciation and tax books for all of their fixed asset
equipment.
• Budgets are posted at the department level for each legal entity.

Requirements. Sales

• Customers should be able to pre-order for fall release of pickles.

• Three-way matching must be enforced for all purchases.
• Fixed asset sale transactions require a ledger account entered at the time of
transaction.
• Fixed assets purchased must be automatically created in fixed asset module. This
includes inventory items and write in purchase orders/non-inventoried items.
 • One dollar from every sale must be tracked and donated at the end of each month to a
charitable organization.
• Purchasing budgets must be enforced at the main account level.

Requirements. Finances

• Accounts payable must be able to enter vendor invoices on the day they were received
to be settled against when product is received.
• Accounts payable must be able to enter vendor invoices to accrue expense without
specifying a purchase order at the time of entry.
• Postage expenses must be split evenly across the regional distribution centers
automatically.
• Administrative expenses must be distributed across the regional distribution centers
by percentage of fulfillment orders monthly.
• Pickling machines depreciation must be uniquely recorded for visibility but not post
to the ledger.

Issues

• During implementation testing, User1 indicates that after packing slips are generated
for purchase orders, there are no ledger postings.
• User2 indicates that fixed assets purchased on a purchase order do not show up in the
Fixed Assets module.
• User3 reports that they are seeing inconsistent application of the one-dollar donation
from all sales orders.
• User4 in the Canadian subsidiary is able to purchase supplies for marketing despite
exceeding the marketing department budget.
• User5 reports that when purchasing a non-inventoried computer, the system is
automatically assigning it to the buildings fixed asset group.

You need to configure Accounts Receivable to take pre-orders.

Which feature should you use?

A. Settle cloud transactions

B. Accounting source explorer
C. Settle open transactions
D. Customer aging report
E. Voucher transactions

Answer: C
Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/cash-bank-management/settlement-
overview

Topic 3, Implement and manage accounts payable and expenses

QUESTION NO: 122 SIMULATION

You are a functional consultant for Contoso Entertainment System USA (USMF).

You need to automate the allocation of a prepaid expense of 2 percent of all product sales.
The allocation must be posted to account number 222222.

To complete this task, sign in to the Dynamics 365 portal.

Answer: See explanation below.

Explanation:

You need to configure a prepayment percentage for all items. The instructions below are for a
single item. For this question, you need to select ‘All’ for all items, enter 2 in the percentage
field and select account number 222222 in the account field.

To set up prepayment percentages for items, customers, and vendors

For an item, you can set up a default prepayment percentage for all customers, a specific
customer, or a customer price group.

1. Choose the icon, enter Items, and then choose the related link.
2. Select an item, and then choose the Prepayment Percentages action.
3. On the Sales Prepayment Percentages page, fill in the fields as necessary. Hover
over a field to read a short description.

Reference:
https://docs.microsoft.com/en-gb/dynamics365/business-central/finance-set-up-prepayments

QUESTION NO: 123 HOTSPOT

You are creating a payment proposal that shows invoices that are eligible to be paid.

You display the Accounts payable Payment proposal screen from the Accounts payable
payment journal.
Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="440" x2="1172" y1="122" y2="149" ss="0" a="0" /><m x1="437"
x2="1170" y1="266" y2="295" ss="0" a="0" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/accounts-payable/create-vendor-
payments-payment-proposal

QUESTION NO: 124 HOTSPOT

A client needs to configure Accounts payment vendor methods of payment to meet the
following business requirements:

• Configure the electronic method of payment to create one electronic payment for all
of the invoices due.
• Configure the system to ensure that all payments made with an electronic method of
payment also forces the user to select which payment has been used.

You display the Methods of payment setup screen.

Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="439" x2="849" y1="122" y2="150" ss="0" a="0" /><m x1="439"
x2="848" y1="294" y2="323" ss="0" a="0" /></map>
Explanation:

QUESTION NO: 125 DRAG DROP

A client wants to use Dynamics 365 Finance invoice validation functionality.

You need to recommend the invoice validation functionality that meets their requirements.

Which functionality should you recommend for each requirement? To answer, drag the
appropriate functionality to the correct requirement. Each functionality may be used once,
more than once, or not at all. You may need to drag the split bar between panes or scroll to
view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="7" x2="302" y1="81" y2="122" ss="0" a="0" /><m x1="7"
x2="302" y1="131" y2="171" ss="0" a="0" /><m x1="8" x2="305" y1="182" y2="220"
ss="0" a="0" /><m x1="9" x2="303" y1="232" y2="272" ss="0" a="0" /><m x1="670"
x2="964" y1="83" y2="126" ss="1" a="0" /><m x1="671" x2="964" y1="135" y2="175"
ss="1" a="0" /><m x1="673" x2="965" y1="184" y2="225" ss="1" a="0" /><c start="0"
stop="0" /><c start="1" stop="1" /><c start="3" stop="2" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/accounts-payable/tasks/set-up-
accounts-payable-invoice-matching-validation

QUESTION NO: 126 HOTSPOT

You need to configure invoice validation for vendors in Dynamics 365 Finance.

You are viewing the Accounts payable parameter for Invoice validation.
Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="911" x2="911" y1="334" y2="334" ss="0" a="0" /><m x1="17"
x2="891" y1="135" y2="154" ss="0" a="0" /><m x1="17" x2="892" y1="264" y2="285"
ss="0" a="0" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/accounts-payable/tasks/set-up-
accounts-payable-invoice-matching-validation

QUESTION NO: 127

You are setting up the Accounts payable module and vendor invoice policies for an
organization.

You need to set up vendor invoice policies that run when vendor invoices are posted in the
system.

In which two ways can you set up the policies? Each correct answer presents a complete
solution.

NOTE: Each correct selection is worth one point.

A. Set up invoice matching validation for vendor invoice policy.

B. Configure the vendor invoice workflow to run the policies.
C. Run the policies when you post a vendor invoice by using the Vendor invoice page and
when you open the Vendor invoice policy violations page.
D. Apply the policies to invoices that were created in the invoice register or invoice journal.

Answer: B, C

Reference:
https://docs.microsoft.com/en-us/dynamicsax-2012/appuser-itpro/key-tasks-vendor-invoice-
policies

QUESTION NO: 128

A client is implementing Accounts payable. The client wants to establish three-way matching
for 100 of their 5,000 stocked items from a specific vendor.

The client requires the ability to have items that require only two-way matching and specific
items that require three-way matching.

You need to configure the system in the most efficient manner to achieve these requirements.

What should you do?

A. Configure a company matching policy of a three-way match

B. Configure a company matching policy of non-required and specify the items that require a
three-way match
C. Configure a company matching policy of two-way matching and set the matching policy
for specific item and vendor combination level to three-way matching
D. Configure a company matching policy of two-way matching and specify the items that
require a three-way match
E. Configure a company matching policy of two-way matching and specify the vendors that
require a three-way match

Answer: C

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/accounts-
payable/tasks/set-up-accounts-payable-invoice-matching-validation

QUESTION NO: 129 HOTSPOT

You need to configure an Accounts payable charge for freight for a company. The company
requires that the system include the freight amount in the invoice to be paid to the vendor and
record the expense in main account 600120 – Freight In.
Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="332" x2="607" y1="127" y2="148" ss="0" a="0" /><m x1="330"
x2="605" y1="230" y2="252" ss="0" a="0" /></map>
Explanation:
QUESTION NO: 130

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A customer uses Dynamics 365 Finance. The customer creates a purchase order for purchase
$20,000 of office furniture.

You need to configure the system to ensure that the funds are reserved when the purchase
order is confirmed.

Solution: Configure item posting groups for purchase requisitions.

Does the solution meet the goal?

A. Yes
B. No

Answer: B

QUESTION NO: 131

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A customer uses Dynamics 365 Finance. The customer creates a purchase order for purchase
$20,000 of office furniture.

You need to configure the system to ensure that the funds are reserved when the purchase
order is confirmed.

Solution: Set up posting definitions for purchase requisitions.

Does the solution meet the goal?

A. Yes
B. No

Answer: B

QUESTION NO: 132

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A customer uses Dynamics 365 Finance. The customer creates a purchase order for purchase
$20,000 of office furniture.

You need to configure the system to ensure that the funds are reserved when the purchase
order is confirmed.

Solution: Configure a posting definition for purchase orders.

Does the solution meet the goal?

A. Yes
B. No

Answer: A

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/example-posting-
definitions

QUESTION NO: 133 DRAG DROP

A customer plans to implement invoice validation policies.

You need to recommend the features needed to meet each of the customer’s requirements.

What should you recommend? To answer, drag the appropriate features to the correct
requirements. Each feature may be used once, more than once, or not at all. You may need to
drag the split bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="3" x2="249" y1="43" y2="86" ss="0" a="0" /><m x1="3" x2="247"
y1="95" y2="135" ss="0" a="0" /><m x1="4" x2="248" y1="145" y2="185" ss="0" a="0"
/><m x1="720" x2="964" y1="78" y2="119" ss="1" a="0" /><m x1="720" x2="964"
y1="128" y2="169" ss="1" a="0" /><m x1="721" x2="965" y1="179" y2="219" ss="1"
a="0" /><c start="0" stop="0" /><c start="0" stop="1" /><c start="1" stop="2" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/accounts-payable/tasks/set-up-
accounts-payable-invoice-matching-validation

QUESTION NO: 134

You are configuring vendor collaboration security roles for external vendors. You manually
set up a vendor contact.

You need to assign the Vendor (external) role to this vendor.

Which tasks can this vendor perform?

A. Activate or inactivate the association between a contact person and a vendor account.
B. Delete any contact person that they have created.
C. View and modify contact person information, such as the person’s title, email address, and
telephone number.
D. View consignment inventory.

Answer: D
Explanation:
Note:
There are several versions of this question in the exam. The question has two possible
correct answers:
1. View consignment inventory.
2. Maintain vendor collaboration invoices.

Other incorrect answer options you may see on the exam include the following:
1. Add a new or existing contact person to the vendor accounts that they are a contact
for.
2. Request a new user account for a contact person by using the Provision user action.
3. Deny or allow a contact person’s access to documents on the vendor collaboration
interface that are specific to the vendor account.
4. Maintain vendor collaboration invoices.
Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/supply-
chain/procurement/set-up-maintain-vendor-collaboration

QUESTION NO: 135

You are configuring the Accounts payable module for a company.

The company needs to set a limit on the charges they will pay for specific items.

You need to set up the limit for charges.

Which two actions should you perform? Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. Enable invoice matching validation in the Accounts payable parameters

B. Enter the maximum amount when you set up the charges code
C. Use budget control with the specified charges code
D. Set the maximum charge amount in the Accounts payable parameters
E. Define the maximum charge amount on the vendor record

Answer: A, B

QUESTION NO: 136

You are configuring vendor collaboration security roles for external vendors. You manually
set up a vendor contact.

You need to assign the Vendor (external) role to this vendor.

Which tasks can this vendor perform?

A. Request a new user account for a contact person by using the Provision user action.
B. Maintain vendor collaboration invoices.
C. Delete any contact person that they have created.
D. View and modify contact person information, such as the person’s title, email address, and
telephone number.

Answer: B
Explanation:
Note:
There are several versions of this question in the exam. The question has two possible
correct answers:
1. View consignment inventory.
2. Maintain vendor collaboration invoices.

Other incorrect answer options you may see on the exam include the following:
1. Add a new or existing contact person to the vendor accounts that they are a contact
for.
2. Request a new user account for a contact person by using the Provision user action.
3. Deny or allow a contact person’s access to documents on the vendor collaboration
interface that are specific to the vendor account.
4. Maintain vendor collaboration invoices.

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/supply-
chain/procurement/set-up-maintain-vendor-collaboration

QUESTION NO: 137 HOTSPOT

You are asked to configure the method of payments for vendors.

You are viewing an Accounts payable method of payment.

Use the drop-down menus to select the answer choice that answers each question based on
the information presented in the graphic.
NOTE: Each correct selection is worth one point.

Answer: <map><m x1="497" x2="674" y1="145" y2="167" ss="0" a="0" /><m x1="493"
x2="672" y1="287" y2="313" ss="0" a="0" /></map>
Explanation:

QUESTION NO: 138 DRAG DROP

A company makes frequent payments to its vendors by using various due dates and discounts.

You need to set up and create a vendor payment by using a payment proposal.
In which order should you perform the actions? To answer, move all actions from the list of
actions to the answer area and arrange them in the correct order.

Answer: <map><m x1="8" x2="300" y1="41" y2="106" ss="0" a="0" /><m x1="9"
x2="298" y1="113" y2="178" ss="0" a="0" /><m x1="9" x2="299" y1="183" y2="247"
ss="0" a="0" /><m x1="8" x2="300" y1="256" y2="320" ss="0" a="0" /><m x1="7"
x2="297" y1="325" y2="389" ss="0" a="0" /><m x1="393" x2="707" y1="39" y2="99"
ss="1" a="0" /><m x1="394" x2="707" y1="105" y2="162" ss="1" a="0" /><m x1="395"
x2="705" y1="172" y2="225" ss="1" a="0" /><m x1="394" x2="704" y1="232" y2="286"
ss="1" a="0" /><m x1="394" x2="703" y1="294" y2="345" ss="1" a="0" /><c start="0"
stop="0" /><c start="1" stop="1" /><c start="4" stop="2" /><c start="3" stop="3" /><c
start="2" stop="4" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/cash-bank-management/tasks/vendor-
payment-overview

QUESTION NO: 139 HOTSPOT

You are setting up the process for an expense report approval in Dynamics 365 Finance.

You need to assign permission for each participant in the workflow approval process to
perform their tasks.

Which action can each participant perform? To answer, select the appropriate option in the
answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="203" x2="478" y1="129" y2="148" ss="0" a="0" /><m x1="203"
x2="478" y1="221" y2="242" ss="0" a="0" /><m x1="202" x2="478" y1="337" y2="356"
ss="0" a="0" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/fin-and-ops/organization-
administration/workflow-actions

QUESTION NO: 140 HOTSPOT

You plan to implement Dynamics 365 Finance.

You need to configure the system to meet the following requirements:

• Post vendor invoices in a journal.

• Create payments to vendors.
• Post headcount transactions.
• Process intercompany transactions.

Which journal types should you use? To answer, select the appropriate configuration in the
answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="327" x2="626" y1="106" y2="133" ss="0" a="0" /><m x1="325"
x2="625" y1="226" y2="253" ss="0" a="0" /><m x1="325" x2="624" y1="371" y2="396"
ss="0" a="0" /><m x1="323" x2="622" y1="563" y2="590" ss="0" a="0" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/general-ledger/ledger-journal-types

QUESTION NO: 141 DRAG DROP

You are processing checks in Dynamics 365 Finance for a client.

You need to identify the outcome of the processed checks.

What is the check status for each scenario? To answer, drag the appropriate check statuses to
the scenarios. Each check status may be used once, more than once, or not at all. You may
need to drag the split bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="12" x2="210" y1="59" y2="95" ss="0" a="0" /><m x1="13"
x2="212" y1="102" y2="136" ss="0" a="0" /><m x1="12" x2="211" y1="143" y2="178"
ss="0" a="0" /><m x1="12" x2="211" y1="186" y2="221" ss="0" a="0" /><m x1="744"
x2="942" y1="102" y2="136" ss="1" a="0" /><m x1="745" x2="944" y1="157" y2="193"
ss="1" a="0" /><m x1="744" x2="944" y1="205" y2="239" ss="1" a="0" /><m x1="745"
x2="942" y1="253" y2="287" ss="1" a="0" /><c start="0" stop="0" /><c start="3" stop="1"
/><c start="2" stop="2" /><c start="1" stop="3" /></map>
Explanation:

QUESTION NO: 142

You are configuring vendor collaboration security roles for external vendors. You manually
set up a vendor contact.

You need to assign the Vendor (external) role to this vendor.

Which task can this vendor perform?

A. View consignment inventory.

B. Add a new or existing contact person to the vendor accounts that they are a contact for.
C. Deny or allow a contact person’s access to documents on the vendor collaboration
interface that are specific to the vendor account.
D. View and modify contact person information, such as the person’s title, email address, and
telephone number.

Answer: D
Explanation:
The Vendor admin (external) role can be used for external vendors that maintain vendor
contact information and make requests to provision new vendor collaboration users. External
users who have this security role can perform the following tasks:

View and modify contact person information, such as the person's title, email address, and
telephone number.
Add a new or existing contact person to the vendor accounts that they are a contact for.
Delete any contact person that they have created.
Etc.

Reference: https://docs.microsoft.com/en-us/dynamics365/supply-chain/procurement/set-up-
maintain-vendor-collaboration

QUESTION NO: 143

You are implementing Dynamics 365 Finance. You configure an invoice validation policy to
use three-way matching and use a three percent tolerance for invoice totals.

A user enters a vendor invoice journal. The invoice validation policy is not applied.

You need to troubleshoot the policy.

What is the issue with the policy?

A. Validation is only performed on vendor invoice entries.

B. The tolerance percentage is too high.
C. Validation is only performed on invoice register entries.
D. Validation is configured to check for price and quantity.

Answer: A
Explanation:
Vendor invoice policies are run when you post a vendor invoice by using the Vendor invoice
page and when you open the vendor invoice Policy violations page. You can also configure
the vendor invoice workflow to run vendor invoice policies every time that you submit an
invoice to workflow.
Vendor invoice policies do not apply to invoices that were created in the invoice register or
invoice journal.
Invoice matching validation does not use vendor invoice policies, but is instead set up in the
Accounts payable parameters page.

Incorrect:
Not C: Vendor invoice policies do not apply to invoices that were created in the invoice
register or invoice journal.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/accounts-
receivable/tasks/set-up-vendor-invoice-policies

QUESTION NO: 144 HOTSPOT

A company uses Dynamics 365 Finance.

The company requires a receipt for any employee expense that is $25 of more.

You need to configure an expense management policy.

How should you configure the expense receipt required rule detail? To answer, select the
appropriate options in the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="69" x2="348" y1="548" y2="570" ss="0" a="0" /><m x1="367"
x2="629" y1="571" y2="594" ss="0" a="0" /><m x1="776" x2="894" y1="526" y2="547"
ss="0" a="0" /><m x1="67" x2="263" y1="680" y2="702" ss="0" a="0" /><m x1="4"
x2="615" y1="802" y2="826" ss="0" a="0" /></map>
Explanation:
Box 1: Transaction amount

Box 2: Greater than or equal to

Box 3: 25

Box 4: Receipt attached

Box 5: Do not allow users to submit until they enter justification.

Reference: https://www.loganconsulting.com/blog/expense-management-using-policies-in-
microsoft-dynamics-365/

QUESTION NO: 145 DRAG DROP

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Munson’s Pickles and Preserves Farm grows and distributes produce, jellies, and jams. The
company’s corporate headquarters is located in Dallas, TX. Munson’s has one operations
center and seven regional distribution centers in the United States.

The company has two wholly owned subsidiaries that operate in Canada. The Canadian entity
owns an entity in France.

Munson’s plans to expand into Latin America by purchasing the last 25 percent of a
subsidiary that they own in Costa Rica. This process is expected to complete within the next
two years.

The company plans to implement Dynamics 365 Finance and Dynamics 365 Supply Chain to
meet their growing business needs.

Current environment. General

Munson’s uses a mix of internally-developed legacy systems that handle their finance and
distribution activities. The company has an isolated CRM system.

• Both Canadian subsidiaries have two departments: marketing and operations.

• Financial reporting is difficult due to data residing in disparate systems.
• Financial reporting is currently performed by using Microsoft Excel.
• Pre-orders in the current system are difficult to track because the order management
system is not integrated with the finance system.
• Pickle sales post to one revenue account, but this does not allow for targeted reporting
by pickle cut and type.

Current environment. Organization

The following chart shows Accounting/Reporting Currencies and Tax ID, if applicable.

• Typically, vendor invoices are received prior to receipt of product.

• The following fixed assets are sold for a loss:
1. BUILD-100
2. CAR-1233
• At the regional distribution centers, the value for physical inventory does not match
the inventory in the financial system.
• Munson’s rents their corporate office. Rent is not paid by purchase order. Rent is due
once a quarter.
• Allocations are performed manually.
• Barrels are inventoried by site and warehouse.
• Munson’s has multiple depreciation and tax books for all of their fixed asset
equipment.
• Budgets are posted at the department level for each legal entity.

Requirements. Sales

• Customers should be able to pre-order for fall release of pickles.

• Three-way matching must be enforced for all purchases.
• Fixed asset sale transactions require a ledger account entered at the time of
transaction.
• Fixed assets purchased must be automatically created in fixed asset module. This
includes inventory items and write in purchase orders/non-inventoried items.
• One dollar from every sale must be tracked and donated at the end of each month to a
charitable organization.
• Purchasing budgets must be enforced at the main account level.

Requirements. Finances
 • Accounts payable must be able to enter vendor invoices on the day they were received
to be settled against when product is received.
• Accounts payable must be able to enter vendor invoices to accrue expense without
specifying a purchase order at the time of entry.
• Postage expenses must be split evenly across the regional distribution centers
automatically.
• Administrative expenses must be distributed across the regional distribution centers
by percentage of fulfillment orders monthly.
• Pickling machines depreciation must be uniquely recorded for visibility but not post
to the ledger.

Issues

• During implementation testing, User1 indicates that after packing slips are generated
for purchase orders, there are no ledger postings.
• User2 indicates that fixed assets purchased on a purchase order do not show up in the
Fixed Assets module.
• User3 reports that they are seeing inconsistent application of the one-dollar donation
from all sales orders.
• User4 in the Canadian subsidiary is able to purchase supplies for marketing despite
exceeding the marketing department budget.
• User5 reports that when purchasing a non-inventoried computer, the system is
automatically assigning it to the buildings fixed asset group.

You need to configure the system to meet invoicing requirement.

Which features should you use? To answer, drag the appropriate features to the correct
requirements. Each feature may be used once, more than once, or not at all. You may need to
drag the split bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="5" x2="247" y1="45" y2="86" ss="0" a="0" /><m x1="4" x2="247"
y1="95" y2="136" ss="0" a="0" /><m x1="6" x2="247" y1="145" y2="185" ss="0" a="0"
/><m x1="719" x2="963" y1="78" y2="119" ss="1" a="0" /><m x1="720" x2="964"
y1="128" y2="169" ss="1" a="0" /><m x1="719" x2="962" y1="178" y2="219" ss="1"
a="0" /><c start="0" stop="0" /><c start="1" stop="1" /><c start="2" stop="2" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/accounts-payable/vendor-invoices-
overview

QUESTION NO: 146 DRAG DROP

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.
Background

Alpine Ski House has three partially owned franchises and 10 fully owned resorts throughout
the United States and Canada. Alpine Ski House’s percentage ownership of the franchises is
between two and 10 percent.

Alpine Ski House is undergoing an implementation of Dynamics 365 Finance and Dynamics
365 Supply Chain Management to transform their financial management and logistics
capabilities across the franchises. Implementation is complete for Alpine Ski House’s
corporate offices, two US franchises, and one Canadian franchise. The remaining franchises
are in varying stages of the implementation. Two new resort projects are in the budget
planning stages and will open in the next fiscal year.

Current environment

Organization and general ledger

• Each franchise is set up as a legal entity in Dynamics 365 Finance.

• Alpine Ski House Corporate uses financial dimensions for their fully owned resorts.
• Each resort is a financial dimension named resort.
• Each fully owned resort has two divisions: marketing and operations.
• Only Profit and Loss account postings require the division dimension.
• Corporate handles the advertising and administration of the fully owned resorts.
• Corporate uses Dynamics 365 Project Management and Accounting to manage
construction of new resorts.

Budgeting

• Organizational budgeting is decentralized but rolls up to one organizational corporate

budget.
• Each resort manager performs budgeting in Dynamics 365 Finance.
• Budget preparation begins this month. All operational resorts will submit their
budgets in two weeks.

Sales and tax

• Sales tax is configured and used by all resorts that operate in the United States.
• You configure one US sales tax vendor account and assign the vendor account to the
settlement periods for reporting.
• You use accounts receivable charges to track donations.

Existing purchasing contracts

 • Each franchise resort has an individual contract with a local supplier of their choosing
to purchase at least $10,000 worth of suppliers during the calendar year.
• The franchise resorts in one US state receive a two percent discount on meat and
vegetable purchases in excess of $8,000 per year.
• A franchise resort in Utah has agreed to purchase 1,000 units of beef at market price
from a local supplier.
• Alpine Ski House uses a vendor collaboration portal to track purchase orders and
requests for quotes.
• Vendors request access to the vendor collaboration portal by using a workflow which
runs on a nightly schedule.

Intercompany setup

Vendor123 resides in US franchise Company1 and is set up for intercompany transactions.

Customer345 resides in Canada franchise Company1 and is set up for intercompany
transactions.

Requirements

Franchises

• Each franchise must pay two percent of monthly sales to Alpine Ski House Corporate.
• Each franchise must report their own financials to Alpine Ski House Corporate
monthly.
• US franchises require a three-way-match on all purchases, with a 1-percent price
tolerance.
• Canadian franchises require a three-way-match on all purchases except paper
products, which have a 10-percent price tolerance.

Corporate

• Advertising costs must be balanced across the 10 resorts monthly. These costs must
be split across the 12 resorts once construction of the final two resorts is completed.
• Administration costs must be split across the 10 resorts proportional to the amount of
sales generated.
• One percent of all pack and individual ski pass sales must be donated quarterly to an
environmental protection organization.
• The finance department must be able to see purchasing contracts and discounts for
vendors based on volume spend.

Employees
All employee expense reports that contain the word entertainment must be reviewed for
audit purposes. If a journal is posted incorrectly, the entire journal and not just the incorrect
line must be fully reversed for audit purposes.

Resorts

All resorts must use Dynamics 365 Finance for budgeting and must first be approved by the
regional manager. Purchased fixed assets must automatically be acquired at product receipt.

Issues

• User1 reports that irrelevant dimensions display in the drop down when entering a
General journal.
• User2 reports that dimension 00 is being used for all balance sheet accounts.
• User3 tries to generate the quarterly sales tax liability payment for a specific state but
does not see any payables available for that state’s vendor.
• User4 receives a call from a vendor who cannot access the vendor collaboration portal
but needs immediate access.
• User5 notices a large amount of entertainment expenses being posted without an audit
review.
• User6 needs to have visibility into the increase in budget that is necessary to staff the
two new resorts opening next year.
• User7 needs to use Dynamics 365 Finance for situational budgeting planning with the
ability to increase and decrease the existing plans by certain percentages.
• User8 made a mistake while posting a 1,000-line journal and reverses the entire
journal but cannot find the lines that included errors during the reversal.
• User9 made a mistake while posting a 55-line journal and reverses the entire journal.
• User10 realizes that the purchase of five new computers did not acquire five new
fixed assets upon receipt.

You need to configure the system to for existing purchasing contracts.

Which commitment types should you use? To answer, drag the appropriate commitment
types to the correct requirements. Each commitment type may be used once, more than once,
or not at all. You may need to drag the split bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="3" x2="247" y1="38" y2="80" ss="0" a="0" /><m x1="4" x2="249"
y1="87" y2="129" ss="0" a="0" /><m x1="4" x2="250" y1="139" y2="180" ss="0" a="0"
/><m x1="3" x2="247" y1="189" y2="231" ss="0" a="0" /><m x1="561" x2="806" y1="79"
y2="123" ss="1" a="0" /><m x1="560" x2="804" y1="130" y2="172" ss="1" a="0" /><c
start="0" stop="0" /><c start="3" stop="1" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/supply-chain/procurement/tasks/create-
purchase-agreement

QUESTION NO: 147

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.
At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Alpine Ski House has three partially owned franchises and 10 fully owned resorts throughout
the United States and Canada. Alpine Ski House’s percentage ownership of the franchises is
between two and 10 percent.

Alpine Ski House is undergoing an implementation of Dynamics 365 Finance and Dynamics
365 Supply Chain Management to transform their financial management and logistics
capabilities across the franchises. Implementation is complete for Alpine Ski House’s
corporate offices, two US franchises, and one Canadian franchise. The remaining franchises
are in varying stages of the implementation. Two new resort projects are in the budget
planning stages and will open in the next fiscal year.

Current environment

Organization and general ledger

• Each franchise is set up as a legal entity in Dynamics 365 Finance.

• Alpine Ski House Corporate uses financial dimensions for their fully owned resorts.
• Each resort is a financial dimension named resort.
• Each fully owned resort has two divisions: marketing and operations.
• Only Profit and Loss account postings require the division dimension.
• Corporate handles the advertising and administration of the fully owned resorts.
• Corporate uses Dynamics 365 Project Management and Accounting to manage
construction of new resorts.

Budgeting
 • Organizational budgeting is decentralized but rolls up to one organizational corporate
budget.
• Each resort manager performs budgeting in Dynamics 365 Finance.
• Budget preparation begins this month. All operational resorts will submit their
budgets in two weeks.

Sales and tax

• Sales tax is configured and used by all resorts that operate in the United States.
• You configure one US sales tax vendor account and assign the vendor account to the
settlement periods for reporting.
• You use accounts receivable charges to track donations.

Existing purchasing contracts

• Each franchise resort has an individual contract with a local supplier of their choosing
to purchase at least $10,000 worth of suppliers during the calendar year.
• The franchise resorts in one US state receive a two percent discount on meat and
vegetable purchases in excess of $8,000 per year.
• A franchise resort in Utah has agreed to purchase 1,000 units of beef at market price
from a local supplier.
• Alpine Ski House uses a vendor collaboration portal to track purchase orders and
requests for quotes.
• Vendors request access to the vendor collaboration portal by using a workflow which
runs on a nightly schedule.

Intercompany setup

Vendor123 resides in US franchise Company1 and is set up for intercompany transactions.

Customer345 resides in Canada franchise Company1 and is set up for intercompany
transactions.

Requirements

Franchises

• Each franchise must pay two percent of monthly sales to Alpine Ski House Corporate.
• Each franchise must report their own financials to Alpine Ski House Corporate
monthly.
• US franchises require a three-way-match on all purchases, with a 1-percent price
tolerance.
• Canadian franchises require a three-way-match on all purchases except paper
products, which have a 10-percent price tolerance.
Corporate

• Advertising costs must be balanced across the 10 resorts monthly. These costs must
be split across the 12 resorts once construction of the final two resorts is completed.
• Administration costs must be split across the 10 resorts proportional to the amount of
sales generated.
• One percent of all pack and individual ski pass sales must be donated quarterly to an
environmental protection organization.
• The finance department must be able to see purchasing contracts and discounts for
vendors based on volume spend.

Employees

All employee expense reports that contain the word entertainment must be reviewed for
audit purposes. If a journal is posted incorrectly, the entire journal and not just the incorrect
line must be fully reversed for audit purposes.

Resorts

All resorts must use Dynamics 365 Finance for budgeting and must first be approved by the
regional manager. Purchased fixed assets must automatically be acquired at product receipt.

Issues

• User1 reports that irrelevant dimensions display in the drop down when entering a
General journal.
• User2 reports that dimension 00 is being used for all balance sheet accounts.
• User3 tries to generate the quarterly sales tax liability payment for a specific state but
does not see any payables available for that state’s vendor.
• User4 receives a call from a vendor who cannot access the vendor collaboration portal
but needs immediate access.
• User5 notices a large amount of entertainment expenses being posted without an audit
review.
• User6 needs to have visibility into the increase in budget that is necessary to staff the
two new resorts opening next year.
• User7 needs to use Dynamics 365 Finance for situational budgeting planning with the
ability to increase and decrease the existing plans by certain percentages.
• User8 made a mistake while posting a 1,000-line journal and reverses the entire
journal but cannot find the lines that included errors during the reversal.
• User9 made a mistake while posting a 55-line journal and reverses the entire journal.
• User10 realizes that the purchase of five new computers did not acquire five new
fixed assets upon receipt.
You need to prevent the issue from reoccurring for User5.

What should you do?

A. Use the audit list search query type.

B. Set up the aggregate query type for entertainment expenses.
C. Set up the sampling query type for entertainment expenses.
D. Add more keywords to the audit policy.

Answer: D

QUESTION NO: 148

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background
Alpine Ski House has three partially owned franchises and 10 fully owned resorts throughout
the United States and Canada. Alpine Ski House’s percentage ownership of the franchises is
between two and 10 percent.

Alpine Ski House is undergoing an implementation of Dynamics 365 Finance and Dynamics
365 Supply Chain Management to transform their financial management and logistics
capabilities across the franchises. Implementation is complete for Alpine Ski House’s
corporate offices, two US franchises, and one Canadian franchise. The remaining franchises
are in varying stages of the implementation. Two new resort projects are in the budget
planning stages and will open in the next fiscal year.

Current environment

Organization and general ledger

• Each franchise is set up as a legal entity in Dynamics 365 Finance.

• Alpine Ski House Corporate uses financial dimensions for their fully owned resorts.
• Each resort is a financial dimension named resort.
• Each fully owned resort has two divisions: marketing and operations.
• Only Profit and Loss account postings require the division dimension.
• Corporate handles the advertising and administration of the fully owned resorts.
• Corporate uses Dynamics 365 Project Management and Accounting to manage
construction of new resorts.

Budgeting

• Organizational budgeting is decentralized but rolls up to one organizational corporate

budget.
• Each resort manager performs budgeting in Dynamics 365 Finance.
• Budget preparation begins this month. All operational resorts will submit their
budgets in two weeks.

Sales and tax

• Sales tax is configured and used by all resorts that operate in the United States.
• You configure one US sales tax vendor account and assign the vendor account to the
settlement periods for reporting.
• You use accounts receivable charges to track donations.

Existing purchasing contracts

• Each franchise resort has an individual contract with a local supplier of their choosing
to purchase at least $10,000 worth of suppliers during the calendar year.
 • The franchise resorts in one US state receive a two percent discount on meat and
vegetable purchases in excess of $8,000 per year.
• A franchise resort in Utah has agreed to purchase 1,000 units of beef at market price
from a local supplier.
• Alpine Ski House uses a vendor collaboration portal to track purchase orders and
requests for quotes.
• Vendors request access to the vendor collaboration portal by using a workflow which
runs on a nightly schedule.

Intercompany setup

Vendor123 resides in US franchise Company1 and is set up for intercompany transactions.

Customer345 resides in Canada franchise Company1 and is set up for intercompany
transactions.

Requirements

Franchises

• Each franchise must pay two percent of monthly sales to Alpine Ski House Corporate.
• Each franchise must report their own financials to Alpine Ski House Corporate
monthly.
• US franchises require a three-way-match on all purchases, with a 1-percent price
tolerance.
• Canadian franchises require a three-way-match on all purchases except paper
products, which have a 10-percent price tolerance.

Corporate

• Advertising costs must be balanced across the 10 resorts monthly. These costs must
be split across the 12 resorts once construction of the final two resorts is completed.
• Administration costs must be split across the 10 resorts proportional to the amount of
sales generated.
• One percent of all pack and individual ski pass sales must be donated quarterly to an
environmental protection organization.
• The finance department must be able to see purchasing contracts and discounts for
vendors based on volume spend.

Employees

All employee expense reports that contain the word entertainment must be reviewed for
audit purposes. If a journal is posted incorrectly, the entire journal and not just the incorrect
line must be fully reversed for audit purposes.
Resorts

All resorts must use Dynamics 365 Finance for budgeting and must first be approved by the
regional manager. Purchased fixed assets must automatically be acquired at product receipt.

Issues

• User1 reports that irrelevant dimensions display in the drop down when entering a
General journal.
• User2 reports that dimension 00 is being used for all balance sheet accounts.
• User3 tries to generate the quarterly sales tax liability payment for a specific state but
does not see any payables available for that state’s vendor.
• User4 receives a call from a vendor who cannot access the vendor collaboration portal
but needs immediate access.
• User5 notices a large amount of entertainment expenses being posted without an audit
review.
• User6 needs to have visibility into the increase in budget that is necessary to staff the
two new resorts opening next year.
• User7 needs to use Dynamics 365 Finance for situational budgeting planning with the
ability to increase and decrease the existing plans by certain percentages.
• User8 made a mistake while posting a 1,000-line journal and reverses the entire
journal but cannot find the lines that included errors during the reversal.
• User9 made a mistake while posting a 55-line journal and reverses the entire journal.
• User10 realizes that the purchase of five new computers did not acquire five new
fixed assets upon receipt.

The Canadian franchise purchases excess ski equipment from the US franchise. Two sets of
skis are purchased totaling USD1,000.

When the purchase invoice is prepared, USD10,000 is keyed in by mistake.

Which configuration determines the result for this intercompany trade scenario?

A. Post invoices with discrepancies is set to require approval.

B. Match invoice totals is set to yes.
C. Three-way match policy is configured.
D. Two-way match policy is configured.
E. Post invoices with discrepancies is set to allow with warning.

Answer: C
QUESTION NO: 149

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Alpine Ski House has three partially owned franchises and 10 fully owned resorts throughout
the United States and Canada. Alpine Ski House’s percentage ownership of the franchises is
between two and 10 percent.

Alpine Ski House is undergoing an implementation of Dynamics 365 Finance and Dynamics
365 Supply Chain Management to transform their financial management and logistics
capabilities across the franchises. Implementation is complete for Alpine Ski House’s
corporate offices, two US franchises, and one Canadian franchise. The remaining franchises
are in varying stages of the implementation. Two new resort projects are in the budget
planning stages and will open in the next fiscal year.

Current environment

Organization and general ledger

 • Each franchise is set up as a legal entity in Dynamics 365 Finance.
• Alpine Ski House Corporate uses financial dimensions for their fully owned resorts.
• Each resort is a financial dimension named resort.
• Each fully owned resort has two divisions: marketing and operations.
• Only Profit and Loss account postings require the division dimension.
• Corporate handles the advertising and administration of the fully owned resorts.
• Corporate uses Dynamics 365 Project Management and Accounting to manage
construction of new resorts.

Budgeting

• Organizational budgeting is decentralized but rolls up to one organizational corporate

budget.
• Each resort manager performs budgeting in Dynamics 365 Finance.
• Budget preparation begins this month. All operational resorts will submit their
budgets in two weeks.

Sales and tax

• Sales tax is configured and used by all resorts that operate in the United States.
• You configure one US sales tax vendor account and assign the vendor account to the
settlement periods for reporting.
• You use accounts receivable charges to track donations.

Existing purchasing contracts

• Each franchise resort has an individual contract with a local supplier of their choosing
to purchase at least $10,000 worth of suppliers during the calendar year.
• The franchise resorts in one US state receive a two percent discount on meat and
vegetable purchases in excess of $8,000 per year.
• A franchise resort in Utah has agreed to purchase 1,000 units of beef at market price
from a local supplier.
• Alpine Ski House uses a vendor collaboration portal to track purchase orders and
requests for quotes.
• Vendors request access to the vendor collaboration portal by using a workflow which
runs on a nightly schedule.

Intercompany setup

Vendor123 resides in US franchise Company1 and is set up for intercompany transactions.

Customer345 resides in Canada franchise Company1 and is set up for intercompany
transactions.
Requirements

Franchises

• Each franchise must pay two percent of monthly sales to Alpine Ski House Corporate.
• Each franchise must report their own financials to Alpine Ski House Corporate
monthly.
• US franchises require a three-way-match on all purchases, with a 1-percent price
tolerance.
• Canadian franchises require a three-way-match on all purchases except paper
products, which have a 10-percent price tolerance.

Corporate

• Advertising costs must be balanced across the 10 resorts monthly. These costs must
be split across the 12 resorts once construction of the final two resorts is completed.
• Administration costs must be split across the 10 resorts proportional to the amount of
sales generated.
• One percent of all pack and individual ski pass sales must be donated quarterly to an
environmental protection organization.
• The finance department must be able to see purchasing contracts and discounts for
vendors based on volume spend.

Employees

All employee expense reports that contain the word entertainment must be reviewed for
audit purposes. If a journal is posted incorrectly, the entire journal and not just the incorrect
line must be fully reversed for audit purposes.

Resorts

All resorts must use Dynamics 365 Finance for budgeting and must first be approved by the
regional manager. Purchased fixed assets must automatically be acquired at product receipt.

Issues

• User1 reports that irrelevant dimensions display in the drop down when entering a
General journal.
• User2 reports that dimension 00 is being used for all balance sheet accounts.
• User3 tries to generate the quarterly sales tax liability payment for a specific state but
does not see any payables available for that state’s vendor.
 • User4 receives a call from a vendor who cannot access the vendor collaboration portal
but needs immediate access.
• User5 notices a large amount of entertainment expenses being posted without an audit
review.
• User6 needs to have visibility into the increase in budget that is necessary to staff the
two new resorts opening next year.
• User7 needs to use Dynamics 365 Finance for situational budgeting planning with the
ability to increase and decrease the existing plans by certain percentages.
• User8 made a mistake while posting a 1,000-line journal and reverses the entire
journal but cannot find the lines that included errors during the reversal.
• User9 made a mistake while posting a 55-line journal and reverses the entire journal.
• User10 realizes that the purchase of five new computers did not acquire five new
fixed assets upon receipt.

You need to resolve the issue that User4 reports.

What should you do?

A. Change the status of the vendor collaboration request

B. Create a vendor account with the systemexternaluser role and the vendor admin
(external) role
C. Remove the externalsystemuser role from the vendor
D. Manually create the vendor account with the systemuser role

Answer: A

QUESTION NO: 150 HOTSPOT

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.
At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

First Up Consultants is a global finance and accounting company.

Financial needs at organizations are constantly changing. When global companies become
too large, it becomes too difficult for them to scale to meet their global operational needs.
First Up Consultants provides “Finance as a Service” capabilities.

Some large corporations complement their existing finance staff by engaging select services
of First Up Consultants. Other large corporations outsource their entire finance operation to
First Up Consultants.

First Up Consultants has hundreds of customers at any time. One such customer, Humongous
Insurance, is updating its Dynamics Finance 365 implementation. Another customer, Trey
Research, is setting up its first Dynamics 365 Finance implementation.

Current environment

Ledger

Humongous Insurance is a US-based company and operates its fiscal year from January 1 to
December 31. Humongous Insurance reports across all its subsidiaries in consolidated
financial reports.

Trey Research is a Canadian-based company that operates its fiscal year from April 1 to
March 31.

Humongous Insurance employees receive an annual cost of living increase.

Requirements
Ledger

• One of Humongous Insurance’s companies provides insurance to government clients

and must separate that particular company into its own subsidiary.
• The Humongous subsidiary will operate in China, which requires a fiscal year from
February 1 to January 31.
• Transactions must be posted in the business of record.
• Humongous Insurance’s subsidiary requires accounting entries to be posted from the
subledger to the general ledger by 5:00 PM each day.
• Trey Research requires accounting entries to be posted from the subledger to the
ledger immediately.

Fiscal calendars

You must create three new fiscal calendars:

• A fiscal calendar named FebJan that runs from Feb 1 to Jan 31.
• A fiscal calendar named AprMar that runs from April 1 to March 31.
• A fiscal calendar named JanDec that runs from January 1 to December 31.

Accounts

• Trey Research must track bank account balances and transactions for each province in
which it operates.
• The bank statement must be sent to the physical address of the home office.

Promotion

• Humongous Insurance’s subsidiary plans to celebrate its new subsidiary status by

sending out free gifts to existing policyholders based on the tier of their policy.
• Promotional items are ordered for distribution and once received must be tracked
within Dynamics 365 Finance.

Taxes

• As part of the spinoff to a subsidiary, Humongous Insurance’s subsidiaries taxes must

be changed from US government rates to Chinese government rates.
• Humongous Insurance’s subsidiary must track use taxes that are not claimed or
reported to the Chinese tax agency.

Reporting
 • The CEO of Humongous Insurance needs to view the insurance products that
customers plan to purchase. The report must show all transactions made over the last
two years.
• The corporate vice president of Humongous Insurance’s subsidiary needs to view the
forecasted cash impact of specific products purchased. The report must show only
new transactions.

Expenses

Expenses must be paid using the following requirements:

Credit card processing

• Humongous Insurance requires al credit card transactions to include line-item details.

• Humongous Insurance’s subsidiary requires the shipping address, merchant address,
and tax information, but cannot include any order line details.
• Trey Research requires all credit card transactions include transaction date,
transaction amount, description, and line-item details.

Compliance and compensation

• Trey Research must be able to audit any modifications to its budget.

• Humongous Insurance employees must receive raises four times per budget cycle.

You need to configure credit card processing for all three companies.
Which option should you use? To answer, select the appropriate options in the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="307" x2="416" y1="160" y2="186" ss="0" a="0" /><m x1="305"
x2="416" y1="255" y2="277" ss="0" a="0" /><m x1="307" x2="417" y1="395" y2="419"
ss="0" a="0" /></map>
Explanation:
Box 1: Level 3
Humongous Insurance requires all credit card transactions to include line-item details.

Level 3 – Transfer all Level 2 information, plus order line information.

Note: Data support

For each credit card type that is supported, you can specify the level of data support. The
level controls how much information about a transaction is transferred to the payment
service. Be sure to check with your provider to determine whether it can provide this
information. Here are the options for the level of data support:

Level 1 – Transfer the transaction date, transaction amount, and description.

Level 2 – Transfer all Level 1 information, plus the shipping and merchant addresses, and tax
information.
Level 3 – Transfer all Level 2 information, plus order line information.

Box 2: Level 2
Humongous Insurance’s subsidiary requires the shipping address, merchant address, and tax
information, but cannot include any order line details.

Box 3: Level 3
Trey Research requires all credit card transactions include transaction date, transaction
amount, description, and line-item details.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/accounts-
receivable/credit-card-authorizations

Topic 4, Manage budgeting

QUESTION NO: 151 DRAG DROP

You are creating a budget for an organization.

The organization requires that allocations be performed automatically as part of budget

planning.

You need to invoke allocations at a specific budget planning stage.

Which three actions should you perform in sequence? To answer, move the appropriate
actions from the list of actions to the answer area and arrange them in the correct order.

Answer: <map><m x1="5" x2="403" y1="41" y2="95" ss="0" a="0" /><m x1="4" x2="404"
y1="105" y2="158" ss="0" a="0" /><m x1="5" x2="403" y1="167" y2="220" ss="0" a="0"
/><m x1="5" x2="404" y1="231" y2="283" ss="0" a="0" /><m x1="490" x2="895" y1="39"
y2="94" ss="1" a="0" /><m x1="491" x2="895" y1="104" y2="157" ss="1" a="0" /><m
x1="492" x2="894" y1="166" y2="221" ss="1" a="0" /><c start="3" stop="0" /><c start="2"
stop="1" /><c start="1" stop="2" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-
operations/financials/budgeting/budget-planning-data-allocation

QUESTION NO: 152

You are configuring budgeting components in Dynamics 365 Finance.

You need to configure multiple budgets.

What are three budgeting options you can use? Each correct answer presents a complete
solution.

NOTE: Each correct selection is worth one point.

A. Cost management budget, including Production and Resource groups

B. Sales budget, including Campaigns and Events
C. Workforce budget, including Compensation groups and Positions
D. Project budget, including Items and Fees
E. Ledger budget, including Revenue and Expense types

Answer: C, D, E

QUESTION NO: 153 HOTSPOT

You are setting up a budget plan to accurately portray the projected budget for a company.

You need to select the appropriate allocation method for data distribution.

Which allocation methods should you use? To answer, select the appropriate configuration in
the answer area.
NOTE: Each correct selection is worth one point.

Answer: <map><m x1="344" x2="618" y1="127" y2="147" ss="0" a="0" /><m x1="344"
x2="619" y1="265" y2="286" ss="0" a="0" /><m x1="343" x2="617" y1="379" y2="399"
ss="0" a="0" /><m x1="342" x2="617" y1="455" y2="475" ss="0" a="0" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-
operations/financials/budgeting/budget-planning-data-allocation

QUESTION NO: 154

A client is using the budget planning process in Dynamics 365 Finance.

Your client requires the ability to plan for a one-year, three-year, and five year-budget.

You need to configure the various year length options to be used in the budgeting module.

What should you do?

A. Configure budget control

B. Configure budget codes
C. Configure budget cycles
D. Configure budget allocation terms

Answer: B

QUESTION NO: 155 DRAG DROP

A company needs to create budget plan templates for its budgeting process.

You need to create the budget plan templates.

In which order should you perform the actions? To answer, move all actions from the list of
actions to the answer area and arrange them in the correct order.

Answer: <map><m x1="8" x2="326" y1="40" y2="83" ss="0" a="0" /><m x1="9" x2="324"
y1="90" y2="133" ss="0" a="0" /><m x1="10" x2="326" y1="142" y2="183" ss="0" a="0"
/><m x1="9" x2="326" y1="190" y2="233" ss="0" a="0" /><m x1="394" x2="752" y1="37"
y2="84" ss="1" a="0" /><m x1="394" x2="752" y1="87" y2="133" ss="1" a="0" /><m
x1="395" x2="751" y1="137" y2="186" ss="1" a="0" /><m x1="395" x2="749" y1="192"
y2="237" ss="1" a="0" /><c start="1" stop="0" /><c start="2" stop="1" /><c start="3"
stop="2" /><c start="0" stop="3" /></map>
Explanation:

QUESTION NO: 156

A company uses Dynamics 365 Finance to manage budgets.

You need to reallocate funds during the year.

Which budget code should you use?

A. Carry-forward
B. Zero-based
C. Pre-encumbrance
D. Transfer

Answer: D

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/budgeting/basic-budgeting-overview-
configuration

QUESTION NO: 157 HOTSPOT

A client is implementing the Budgeting module in Dynamics 365 Finance.

You need to configure the correct budget control area to meet the client's requirements.

• Track budgeting control on purchase requisitions.

• Include unposted actual transactions in the calculation of the remaining budget for the
period.
• Allow specific individuals to post transactions that exceed the budget.
• Specify main accounts that are subject to budget control, instead of selecting Main
account as a dimension for budgeting.

What should you configure? To answer, select the appropriate configuration in the answer
area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="456" x2="757" y1="104" y2="130" ss="0" a="0" /><m x1="455"
x2="755" y1="274" y2="300" ss="0" a="0" /><m x1="455" x2="754" y1="442" y2="469"
ss="0" a="0" /><m x1="454" x2="753" y1="613" y2="638" ss="0" a="0" /></map>
Explanation:
Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/budgeting/budget-control-overview-
configuration

QUESTION NO: 158

A company plans to use Dynamics 365 Finance.

You need to configure basic budgeting.

Which set of actions must you perform?

A.
• Define a budget journal
• Define budgeting parameters
• Define budgeting dimensions
• Create budget models and codes
• Define number sequences
B.
• Define budget journal exchange rate types
• Define budgeting parameters and number sequences
• Define budgeting dimensions
• Create budget models
• Define budget codes

C.
• Define a budget journal
• Define budgeting parameters and number sequences
• Define budgeting dimensions
• Create budget models and codes
• Setup budget allocation terms

D.
• Define budget exchange rate types
• Define budgeting parameters and number sequences
• Define financial dimensions
• Create budget models
• Define budget codes

Answer: B

Reference:
https://docs.microsoft.com/en-us/learn/modules/configure-use-basic-budgeting-budget-
control-dyn365-finance/4-overview

QUESTION NO: 159

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A company is preparing to complete yearly budgets.

The company plans to use the Budget module in Dynamics 365 Finance for budget
management.
You need to create the new budgets.

Solution: Combine budgets from multiple legal entities to a master budget.

Does the solution meet the goal?

A. Yes
B. No

Answer: B

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-
operations/financials/budgeting/budget-planning-overview-configuration

QUESTION NO: 160

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A company is preparing to complete yearly budgets.

The company plans to use the Budget module in Dynamics 365 Finance for budget
management.

You need to create the new budgets.

Solution: Create budget plans for multiple scenarios.

Does the solution meet the goal?

A. Yes
B. No

Answer: A

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-
operations/financials/budgeting/budget-planning-overview-configuration

QUESTION NO: 161

Note: This question is part of a series of questions that present the same scenario. Each
question in the series contains a unique solution that might meet the stated goals. Some
question sets might have more than one correct solution, while others might not have a
correct solution.

After you answer a question in this section, you will NOT be able to return to it. As a
result, these questions will not appear in the review screen.

A company is preparing to complete yearly budgets.

The company plans to use the Budget module in Dynamics 365 Finance for budget
management.

You need to create the new budgets.

Solution: Create budget plans to define the revenues for a budget.

Does the solution meet the goal?

A. Yes
B. No

Answer: B

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-
operations/financials/budgeting/budget-planning-overview-configuration

QUESTION NO: 162

A customer uses Dynamics 365 Finance to manage budgets.

You review a customer’s budget funds available calculation and discover that the budget
amounts posted two weeks ago are not reflected in the budget control check on a purchase
order.

You verify that budget control is set to active.

You need to determine why the budget posted two weeks ago is not reflecting correctly.

What should you do?

A. Verify that available budget funds are configured appropriately.

B. Post a budget transfer to add the correct funds.
C. Verify whether budget plans are still in draft status.
D. Compare the budget control active date to the date of the posted register entries to verify
that it was active at the time of posting.

Answer: D

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/budgeting/budget-control-overview-
configuration

QUESTION NO: 163

A company configures budget controls at the beginning of the year.

Which three budget control transaction actions occur when the budget control is turned off
mid-year. Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. Activities are unrecorded for budget control purposes.

B. Budget register entries that have been posted after budget control is turned off will not be
considered for budget control.
C. Posted documents might incorrectly reflect any relieving amounts or balances in inquiries
and reports that are related to budget control.
D. Budget checks are performed.
E. You can view the budget reporting through financial reports.

Answer: A, B, C

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/budgeting/budget-control-overview-
configuration

QUESTION NO: 164

You are setting up the yearly budget for an organization for the year 2019.

You need to set up the budget register entries.

Which two fields must be set up when creating register entries? Each correct answer presents
part of the solution.

NOTE: Each correct selection is worth one point.

A. Budget cycle
B. Budget manager
C. Budget code
D. Budget model

Answer: C, D

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/budgeting/basic-budgeting-overview-
configuration

QUESTION NO: 165

You are configuring the basic budgeting for a Dynamics 365 Finance environment.

You need to configure the types of entries allowed.

Which two configurations can you use? Each correct answer presents a complete solution.

NOTE: Each correct selection is worth one point.

A. The budget register entry journals require both Expense and Revenue amount types.
B. Budget register entry line needs a main account and amount to be valid.
C. Budget register entry journals must be allocated across all fiscal periods.
D. Budget register entry lines must select only one account structure.
E. The budget register entries can contain either Expense or Revenue amount types.

Answer: D, E

QUESTION NO: 166

A company is preparing to complete yearly budgets.

The company plans to use the Budget module in Dynamics 365 Finance for budget
management.

You need to create the new budgets.

What should you do?

A. Create budget plans for multiple scenarios.

B. Create budget plans to define the revenues for a budget.
C. Combine previous year budgets into a single budget.

Answer: A

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-
operations/financials/budgeting/budget-planning-overview-configuration

QUESTION NO: 167

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.
Background

Munson’s Pickles and Preserves Farm grows and distributes produce, jellies, and jams. The
company’s corporate headquarters is located in Dallas, TX. Munson’s has one operations
center and seven regional distribution centers in the United States.

The company has two wholly owned subsidiaries that operate in Canada. The Canadian entity
owns an entity in France.

Munson’s plans to expand into Latin America by purchasing the last 25 percent of a
subsidiary that they own in Costa Rica. This process is expected to complete within the next
two years.

The company plans to implement Dynamics 365 Finance and Dynamics 365 Supply Chain to
meet their growing business needs.

Current environment. General

Munson’s uses a mix of internally-developed legacy systems that handle their finance and
distribution activities. The company has an isolated CRM system.

• Both Canadian subsidiaries have two departments: marketing and operations.

• Financial reporting is difficult due to data residing in disparate systems.
• Financial reporting is currently performed by using Microsoft Excel.
• Pre-orders in the current system are difficult to track because the order management
system is not integrated with the finance system.
• Pickle sales post to one revenue account, but this does not allow for targeted reporting
by pickle cut and type.

Current environment. Organization

The following chart shows Accounting/Reporting Currencies and Tax ID, if applicable.

• Typically, vendor invoices are received prior to receipt of product.

• The following fixed assets are sold for a loss:
1. BUILD-100
2. CAR-1233
• At the regional distribution centers, the value for physical inventory does not match
the inventory in the financial system.
• Munson’s rents their corporate office. Rent is not paid by purchase order. Rent is due
once a quarter.
• Allocations are performed manually.
 • Barrels are inventoried by site and warehouse.
• Munson’s has multiple depreciation and tax books for all of their fixed asset
equipment.
• Budgets are posted at the department level for each legal entity.

Requirements. Sales

• Customers should be able to pre-order for fall release of pickles.

• Three-way matching must be enforced for all purchases.
• Fixed asset sale transactions require a ledger account entered at the time of
transaction.
• Fixed assets purchased must be automatically created in fixed asset module. This
includes inventory items and write in purchase orders/non-inventoried items.
• One dollar from every sale must be tracked and donated at the end of each month to a
charitable organization.
• Purchasing budgets must be enforced at the main account level.

Requirements. Finances

• Accounts payable must be able to enter vendor invoices on the day they were received
to be settled against when product is received.
• Accounts payable must be able to enter vendor invoices to accrue expense without
specifying a purchase order at the time of entry.
• Postage expenses must be split evenly across the regional distribution centers
automatically.
• Administrative expenses must be distributed across the regional distribution centers
by percentage of fulfillment orders monthly.
• Pickling machines depreciation must be uniquely recorded for visibility but not post
to the ledger.

Issues

• During implementation testing, User1 indicates that after packing slips are generated
for purchase orders, there are no ledger postings.
• User2 indicates that fixed assets purchased on a purchase order do not show up in the
Fixed Assets module.
• User3 reports that they are seeing inconsistent application of the one-dollar donation
from all sales orders.
• User4 in the Canadian subsidiary is able to purchase supplies for marketing despite
exceeding the marketing department budget.
• User5 reports that when purchasing a non-inventoried computer, the system is
automatically assigning it to the buildings fixed asset group.
Which configuration makes it possible for User4 to make a purchase?

A. Budget model configuration is configured to allow certain purchases to exceed budget.

B. Budget is posted at the dimension level. Budget control is managed at main account level.
C. Budget funds available are configured to allow dimension budget overrides.
D. Budget is posted at the main account level. Budget control is managed at the department
level.

Answer: B

QUESTION NO: 168 HOTSPOT

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Alpine Ski House has three partially owned franchises and 10 fully owned resorts throughout
the United States and Canada. Alpine Ski House’s percentage ownership of the franchises is
between two and 10 percent.
Alpine Ski House is undergoing an implementation of Dynamics 365 Finance and Dynamics
365 Supply Chain Management to transform their financial management and logistics
capabilities across the franchises. Implementation is complete for Alpine Ski House’s
corporate offices, two US franchises, and one Canadian franchise. The remaining franchises
are in varying stages of the implementation. Two new resort projects are in the budget
planning stages and will open in the next fiscal year.

Current environment

Organization and general ledger

• Each franchise is set up as a legal entity in Dynamics 365 Finance.

• Alpine Ski House Corporate uses financial dimensions for their fully owned resorts.
• Each resort is a financial dimension named resort.
• Each fully owned resort has two divisions: marketing and operations.
• Only Profit and Loss account postings require the division dimension.
• Corporate handles the advertising and administration of the fully owned resorts.
• Corporate uses Dynamics 365 Project Management and Accounting to manage
construction of new resorts.

Budgeting

• Organizational budgeting is decentralized but rolls up to one organizational corporate

budget.
• Each resort manager performs budgeting in Dynamics 365 Finance.
• Budget preparation begins this month. All operational resorts will submit their
budgets in two weeks.

Sales and tax

• Sales tax is configured and used by all resorts that operate in the United States.
• You configure one US sales tax vendor account and assign the vendor account to the
settlement periods for reporting.
• You use accounts receivable charges to track donations.

Existing purchasing contracts

• Each franchise resort has an individual contract with a local supplier of their choosing
to purchase at least $10,000 worth of suppliers during the calendar year.
• The franchise resorts in one US state receive a two percent discount on meat and
vegetable purchases in excess of $8,000 per year.
 • A franchise resort in Utah has agreed to purchase 1,000 units of beef at market price
from a local supplier.
• Alpine Ski House uses a vendor collaboration portal to track purchase orders and
requests for quotes.
• Vendors request access to the vendor collaboration portal by using a workflow which
runs on a nightly schedule.

Intercompany setup

Vendor123 resides in US franchise Company1 and is set up for intercompany transactions.

Customer345 resides in Canada franchise Company1 and is set up for intercompany
transactions.

Requirements

Franchises

• Each franchise must pay two percent of monthly sales to Alpine Ski House Corporate.
• Each franchise must report their own financials to Alpine Ski House Corporate
monthly.
• US franchises require a three-way-match on all purchases, with a 1-percent price
tolerance.
• Canadian franchises require a three-way-match on all purchases except paper
products, which have a 10-percent price tolerance.

Corporate

• Advertising costs must be balanced across the 10 resorts monthly. These costs must
be split across the 12 resorts once construction of the final two resorts is completed.
• Administration costs must be split across the 10 resorts proportional to the amount of
sales generated.
• One percent of all pack and individual ski pass sales must be donated quarterly to an
environmental protection organization.
• The finance department must be able to see purchasing contracts and discounts for
vendors based on volume spend.

Employees

All employee expense reports that contain the word entertainment must be reviewed for
audit purposes. If a journal is posted incorrectly, the entire journal and not just the incorrect
line must be fully reversed for audit purposes.

Resorts
All resorts must use Dynamics 365 Finance for budgeting and must first be approved by the
regional manager. Purchased fixed assets must automatically be acquired at product receipt.

Issues

• User1 reports that irrelevant dimensions display in the drop down when entering a
General journal.
• User2 reports that dimension 00 is being used for all balance sheet accounts.
• User3 tries to generate the quarterly sales tax liability payment for a specific state but
does not see any payables available for that state’s vendor.
• User4 receives a call from a vendor who cannot access the vendor collaboration portal
but needs immediate access.
• User5 notices a large amount of entertainment expenses being posted without an audit
review.
• User6 needs to have visibility into the increase in budget that is necessary to staff the
two new resorts opening next year.
• User7 needs to use Dynamics 365 Finance for situational budgeting planning with the
ability to increase and decrease the existing plans by certain percentages.
• User8 made a mistake while posting a 1,000-line journal and reverses the entire
journal but cannot find the lines that included errors during the reversal.
• User9 made a mistake while posting a 55-line journal and reverses the entire journal.
• User10 realizes that the purchase of five new computers did not acquire five new
fixed assets upon receipt.

You need to configure the system to meet the budget preparation requirements.

What should you do? To answer, select the appropriate options in the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="464" x2="1012" y1="114" y2="141" ss="0" a="0" /><m x1="464"
x2="1011" y1="333" y2="360" ss="0" a="0" /><m x1="464" x2="1010" y1="403" y2="429"
ss="0" a="0" /></map>
Explanation:

QUESTION NO: 169 HOTSPOT

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.
To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Fourth Coffee is a coffee and supplies manufacturer based in Seattle. The company recently
purchased CompanyA, based in the United States, and CompanyB, based in Canada, in order
to increase production of their award-winning espresso machine and distribution of their dark
roast coffee beans, respectively.

Fourth Coffee has set up CompanyA and CompanyB in their Dynamics 365 Finance to gain
better visibility into the companies’ profitability. CompanyA and CompanyB will continue to
operate as subsidiaries of Fourth Coffee, but all operational companies will be consolidated
under Fourth Coffee Holding Company in US dollars (USD) for reporting purposes.

The current organizational chart is shown below:

Current environment

Systemwide setup
 • Dynamics 365 Finance in Microsoft Azure is used to manage the supply chain, retail,
and financials.
• All companies share a Chart of Accounts.
• Two dimensions are used: Department and Division.
• Budgeting is controlled at the department level.
• Customers and vendors are defined as two groups: Domestic and International.
• Mandatory credit check is set to No.
• Consolidate online is used for the consolidation of all companies.
• International main accounts are subject to foreign currency revaluation.
• The purchasing budget is used to enforce purchasing limits.

General ledger accounts

Fourth Coffee

• The base currency is USD.

• Three item groups are used: coffee, supplies, and nonstock.
• The standard sales tax method is used.
• Acquiring fixed assets requires a purchase order.
• All customer payment journals require a deposit slip.
• CustomerX is a taxable company.
• CustomerY is a tax-exempt company.
• CustomerZ is a taxable company.
• VendorA is a Colombian supplier of coffee beans and belongs to the international
vendor group.
• VendorB is a Peruvian supplier of coffee machine filters and belongs to the
international vendor group.
• VendorC is a Texas supplier of espresso valves and belongs to the domestic vendor
group.

CompanyA

• The base currency is USD.

• It consists of a marketing department and a digital division.
• A 4-5-4 calendar structure is used.
 • The standard sales tax method is used.

CompanyB

• The base currency is CAD.

• The conditional sales tax method is used.

Requirements

Reporting

• A consolidated Fourth Coffee financial report is required in USD currency.

• Fourth Coffee and its subsidiaries need to be able to report sales by item type.
• Year-end adjustments need to be reported separately in a different period to view
financial reporting inclusive and exclusive of year-end adjustments.

Issues

• User1 observes that a General journal was used in error to post to the Domestic
Accounts Receivable trade account.
• User2 has to repeatedly reclassify vendor invoice journals in Fourth Coffee Company
that are posted to the marketing department and digital division.
• When User3 posts an Accounts receivable payment journal, a deposit slip is not
generated.
• User4 observes an increase in procurement department expenses for supplies.
• User5 observes that sales tax is not calculating on a sales order for CustomerZ.
• User6 observes that sales tax is calculating for CustomerY.
• User7 observes that the sales tax payment report is excluding posted invoice
transactions.
• User8 in CompanyA attempts to set up the sales tax receivable account on the sales
tax posting form.
• User9 in CompanyA needs to purchase three tablets by using a purchase order and
record the devices as fixed assets.
• CustomerX requires a credit check when making a purchase and is currently at their
credit limit.

You need to configure the budgeting module to meet Fourth Coffee’s requirements.

Which configuration should you use for each task? To answer, select the appropriate options
in the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="463" x2="842" y1="112" y2="139" ss="0" a="0" /><m x1="463"
x2="609" y1="224" y2="251" ss="0" a="0" /><m x1="464" x2="610" y1="361" y2="384"
ss="0" a="0" /></map>
Explanation:

Box 1: budget control documents and journals

On the Documents and journals tab, you can select which source documents and journals will
be subject to budget control checks, and whether the checks will occur at the level of the line
entry or the whole document.

Note: User4 observes an increase in procurement department expenses for supplies.

Incorrect:
* Budget funds available
On the Budget funds available tab, you can define the formula that is used to calculate
available budget funds. Depending on how conservatively an organization manages its
financial resources, or depending on regulations or industry requirements, the calculation can
include draft or unposted documents.
* Assign budget models
On the Assign budget models tab, you assign budget models to the budget cycle time spans
that should be included in budget control.

Box 2: divison
Two dimensions are used: Department and Division.

Box 3: department
Note: Budgeting is controlled at the department level.
The purchasing budget is used to enforce purchasing limits.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/budgeting/budget-control-
overview-configuration

Topic 5, Manage fixed assets

QUESTION NO: 170 HOTSPOT

You are the purchase manager of an organization. You purchase a laptop for your office for
$2,000. You plan to create a purchase order and acquire the new fixed asset through the
purchase order at time of invoicing.

You set up the system as follows: Fixed assets are automatically created during product
receipt or vendor invoice posting and the capitalization threshold for the computers group
(COMP) is set to $1,600.

You need to automatically create a fixed asset record when you post an acquisition
transaction for the asset after you post the invoice.

How should you configure the fixed asset parameters to meet the criteria? To answer, select
the appropriate option in the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="267" x2="819" y1="116" y2="147" ss="0" a="0" /><m x1="267"
x2="818" y1="349" y2="385" ss="0" a="0" /></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/fixed-assets/acquire-assets-
procurement

QUESTION NO: 171 DRAG DROP

A client is implementing fixed assets in Dynamics 365 Finance.

You need to specify which parameters should be configured to meet the business
requirements.

Which parameters meet the requirements? To answer, drag the appropriate parameters to the
correct requirements. Each parameter may be used once, more than once, or not at all. You
may need to drag the split bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="13" x2="199" y1="80" y2="122" ss="0" a="0" /><m x1="13"
x2="201" y1="128" y2="171" ss="0" a="0" /><m x1="15" x2="200" y1="179" y2="222"
ss="0" a="0" /><m x1="658" x2="846" y1="87" y2="128" ss="1" a="0" /><m x1="660"
x2="845" y1="137" y2="179" ss="1" a="0" /><m x1="662" x2="846" y1="188" y2="228"
ss="1" a="0" /><c start="0" stop="0" /><c start="0" stop="1" /><c start="2" stop="2"
/></map>
Explanation:

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/fixed-assets/tasks/set-up-fixed-asset-
posting-profiles

https://docs.microsoft.com/en-us/dynamics365/finance/fixed-assets/set-up-fixed-assets

QUESTION NO: 172

An organization acquires a building.

You need to register and record the building as an asset building in Dynamics 365 Finance.

What are three possible ways to achieve the goal? Each correct answer presents a complete
solution.

NOTE: Each correct selection is worth one point.

A. Select an account type of Fixed Asset and a transaction type of Acquisition with a General
Journal
B. Eliminate the project to a fixed asset
C. Create a sales invoice to record and register the fixed asset
D. Select an acquisition transaction type within a fixed asset journal
E. Use the sales order process to acquire the asset

Answer: A, B, D

QUESTION NO: 173

You are the accounts receivable manager of an organization. The organization recently sold
machinery to a customer.

You need to register a transaction for the sale of the machinery by using a free text invoice
for fixed assets.

Which transaction type should you use?

A. Acquisition
B. Value adjustments
C. Depreciation
D. Disposal

Answer: D

QUESTION NO: 174

You are the controller for an organization. The company purchased six service trucks. You
observe that your accountant set up Fixed assets – vehicles in the wrong fixed asset group.

You need to achieve the following:

 • Change the fixed asset group so that the existing fixed asset transactions for the
original fixed asset are canceled and regenerated for the new fixed asset.
• Ensure that all books for the existing fixed asset are created for the new fixed asset.
Any information that was set up for the original fixed asset is copied to the new fixed
asset.
• Close the old fixed asset number in the old fixed assets group and create a new fixed
asset number in the new fixed assets group.
• Ensure that the historical transactions are transferred to the new fixed asset.
• Ensure Historical Depreciation expense entries do not change.

What should you do?

A. Reclassify the fixed asset

B. Change the fixed asset group and keep the same fixed asset number
C. Copy the fixed asset
D. Transfer the fixed assets

Answer: A

Reference:
https://docs.microsoft.com/en-us/dynamics365/unified-operations/financials/fixed-
assets/tasks/reclassify-fixed-assets

QUESTION NO: 175

You are configuring the Fixed assets module for a Dynamics 365 Finance environment.

You need to create a fixed asset.

Which two settings are required? Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. the property type

B. the group
C. the number sequence
D. the type
E. the name

Answer: B, E
Explanation:
The type and number sequence are configured in the group so you don’t need to enter those
values.

Reference:
https://ellipsesolutions.com/dynamics-365-finance-operations-fixed-asset-acquisition-
options/

QUESTION NO: 176 HOTSPOT

You manage fixed assets in Dynamics 365 Finance.

You have the following requirements:

• Purchase a fixed asset on a purchase order by using a procurement category.

• Purchase a fixed asset on a purchase order by using an item number.
• Post specific tax transactions for fixed assets by using a journal.

You need to associate the appropriate process in the system with the corresponding business
requirement.

Which actions should you perform? To answer, select the appropriate configuration in the
answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="383" x2="870" y1="98" y2="126" ss="0" a="0" /><m x1="383"
x2="871" y1="231" y2="259" ss="0" a="0" /><m x1="384" x2="870" y1="367" y2="392"
ss="0" a="0" /></map>
Explanation:

Reference:
https://www.loganconsulting.com/blog/fixed-asset-determination-rules-in-d365-for-finance-
and-operations/

QUESTION NO: 177

You manage fixed assets using Microsoft Dynamics 365 Finance.

You need to define capitalization thresholds.

Which page should you use?

A. Main account
B. Released item
C. Fixed asset posting profile
D. Fixed asset group

Answer: D
Explanation:
Configure fixed assets components.
The Fixed asset group field is the only required field when you create a fixed asset. The value
of this field determines the default value of several informational fields for the asset.
The Capitalization threshold field determines the assets that are depreciated. If a purchase
line is selected as a fixed asset, but it doesn't meet the specified capitalization threshold, a
fixed asset is still created or updated, but the Calculate prorated depreciation option is set to
No. Therefore, the asset won't be automatically depreciated as part of the depreciation
proposals.

Note: To manually create an asset record, follow these steps.

1. Go to Navigation pane > Modules > Fixed assets > Fixed assets > Fixed assets.

2. On the Action pane, select New.

3. In the Fixed asset group field, enter or select a value. The Number field will default if
you have enabled Autonumber fixed assets functionality in the Fixed assets
parameters and the Fixed asset group. If not, you must enter a unique number to
identify the fixed asset.

4. Etc.

Reference: https://docs.microsoft.com/en-us/learn/modules/configure-fixed-assets-mgmt-
dyn365-finance/5-configure

QUESTION NO: 178 DRAG DROP

A company is implementing Microsoft Dynamics 365 Finance.

The company is configuring depreciation for company vehicles. Vehicles must be depreciated
by using straight-line service life on the 15th day of each month.

You need to configure vehicle depreciation.

What should you use? To answer, drag the appropriate features to the correct requirements.
Each feature may be used once, more than once, or not at all. You may need to drag the split
bar between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="9" x2="265" y1="43" y2="87" ss="0" a="0" /><m x1="11"
x2="266" y1="93" y2="137" ss="0" a="0" /><m x1="10" x2="266" y1="146" y2="189"
ss="0" a="0" /><m x1="9" x2="267" y1="196" y2="241" ss="0" a="0" /><m x1="493"
x2="752" y1="69" y2="115" ss="1" a="0" /><m x1="495" x2="752" y1="140" y2="185"
ss="1" a="0" /><c start="0" stop="0" /><c start="1" stop="1" /></map>
Explanation:

Box 1: Method
When you set up a fixed asset depreciation profile and select Straight line service life in the
Method field in the Depreciation profiles page, the assets that have this depreciation profile
assigned to them are depreciated based on the total service life of the asset. This generally is
the same depreciation amount in each depreciation period.

Box 2: Convention
Depreciation conventions are used to determine when and how depreciation is calculated for
both the year when the fixed asset is acquired and the year when the fixed asset is disposed
of.
Example: Mid month (15th of month)

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/fixed-assets/straight-line-
service-life-depreciation
https://docs.microsoft.com/en-us/dynamics365/finance/fixed-assets/fixed-asset-depreciation-
conventions

QUESTION NO: 179 HOTSPOT

A company uses Dynamics 365 Finance to manage fixed assets. The company’s fiscal year is
set as the calendar year.

The company requires two books for each fixed asset. The company has the following
requirements for the books:

You need to configure a fixed asset group book setup to meet the requirements.

Which depreciation conventions and depreciation profiles should you use? To answer, select
the appropriate options in the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="167" x2="449" y1="106" y2="130" ss="0" a="0" /><m x1="168"
x2="450" y1="292" y2="315" ss="0" a="0" /><m x1="489" x2="838" y1="132" y2="154"
ss="0" a="0" /><m x1="487" x2="837" y1="246" y2="274" ss="0" a="0" /></map>
Explanation:
Box 1: None
You can select either Calendar or Fiscal in the Depreciation year field in the Depreciation
profiles page. The selection defines the options that are available in the Period frequency
field.

If you select Fiscal in the Depreciation year field, the straight line service life depreciation is
used. It is calculated based on the fiscal year, which is defined by the fiscal calendar that is
specified for the book, or by the fiscal calendar that is selected in the Ledger page. Fiscal
calendars are set up in the Fiscal calendars page.

Note: If you select Calendar, you can select from the following depreciation conventions.

Half year
Full month
Mid quarter
Mid month (1st of month)
Mid month (15th of month)
Half year (start of year)
Half year (next year)

Box 2: Straight line service life - Fiscal period

When you set up a fixed asset depreciation profile and select Straight line service life in the
Method field in the Depreciation profiles page, the assets that have this depreciation profile
assigned to them are depreciated based on the total service life of the asset. This generally is
the same depreciation amount in each depreciation period.

You can select either Calendar or Fiscal in the Depreciation year field in the Depreciation
profiles page.

Incorrect:
Not Straight line life remaining:
When you set up a fixed asset depreciation profile and select Straight line life remaining in
the Method field on the Depreciation profiles page, the depreciation of fixed assets that are
assigned to the depreciation profile is based on the remaining service life of the asset.

Box 3: Half year (start of year)

Box 4: 200% reducing balance - Yearly

To set up 200% reducing balance depreciation, you must also select options in the
Depreciation year field and the Period frequency field on the Depreciation profiles page. The
options that are available in the Period frequency field vary, depending on the value that you
select in the Depreciation year field.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/fixed-assets/depreciation-
methods-conventions
https://docs.microsoft.com/en-us/dynamics365/finance/fixed-assets/straight-line-service-life-
depreciation
https://docs.microsoft.com/en-us/dynamics365/finance/fixed-assets/200-percent-reducing-
balance-depreciation

QUESTION NO: 180 HOTSPOT

A company is configuring the Microsoft Dynamics 365 Finance Fixed asset module.

You must configure depreciation for fixed assets. The company has the following assets and
requirements:

You need to configure the assets to meet the depreciation requirements.

Which depreciation method should you use? To answer, select the appropriate options in the
answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="82" x2="365" y1="107" y2="131" ss="0" a="0" /><m x1="80"
x2="365" y1="247" y2="273" ss="0" a="0" /></map>
Explanation:

Box 1: Double declining balance

When you set up a fixed asset depreciation profile and select 200% reducing balance in the
Method field on the Depreciation profiles page, fixed assets that are assigned the depreciation
profile are depreciated by the same percentage in each depreciation period. The percentage is
calculated based on the service life of the asset. For example, if an asset has a service life of
five years, the percentage is calculated as 40 percent (200% ÷ 5).
This method is also known as double declining balance.

Box 2: Straight line

When you set up a fixed asset depreciation profile and select Straight line service life in the
Method field in the Depreciation profiles page, the assets that have this depreciation profile
assigned to them are depreciated based on the total service life of the asset. This generally is
the same depreciation amount in each depreciation period.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/fixed-assets/200-percent-
reducing-balance-depreciation
https://docs.microsoft.com/en-us/dynamics365/finance/fixed-assets/straight-line-service-life-
depreciation

QUESTION NO: 181 HOTSPOT

A company is implementing Dynamics 365 Finance.

The company purchases fixed assets using a purchase order. The company must post tax-
specific transactions related to the fixed assets so the transactions can be reported separately.

You need to configure the system.

What should you configure? To answer, select the appropriate options in the answer area.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="640" x2="960" y1="161" y2="184" ss="0" a="0" /><m x1="639"
x2="894" y1="225" y2="250" ss="0" a="0" /></map>
Explanation:
Box 1: Depreciation methods
When you use a method where the asset is automatically created and acquired, you can set up
the system to verify whether the purchase amount of the fixed asset meets a specified
capitalization threshold for asset depreciation. If so, the Depreciation option will be selected
in the books for the asset when it is created from Accounts payable.

Box 2: Posting layers

Post fixed asset transactions to posting layers.
Fixed asset journals are defined by using the Journal names page at General ledger > Journal
setup > Journal names. Each journal that you can post depreciations in is defined by its
journal name for only one posting layer.

Reference: https://docs.microsoft.com/en-us/dynamics365/finance/fixed-assets/acquire-
assets-procurement
https://docs.microsoft.com/en-us/dynamics365/finance/fixed-assets/post-fixed-asset-
transactions-posting-layers

QUESTION NO: 182

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.
To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Munson’s Pickles and Preserves Farm grows and distributes produce, jellies, and jams. The
company’s corporate headquarters is located in Dallas, TX. Munson’s has one operations
center and seven regional distribution centers in the United States.

The company has two wholly owned subsidiaries that operate in Canada. The Canadian entity
owns an entity in France.

Munson’s plans to expand into Latin America by purchasing the last 25 percent of a
subsidiary that they own in Costa Rica. This process is expected to complete within the next
two years.

The company plans to implement Dynamics 365 Finance and Dynamics 365 Supply Chain to
meet their growing business needs.

Current environment. General

Munson’s uses a mix of internally-developed legacy systems that handle their finance and
distribution activities. The company has an isolated CRM system.

• Both Canadian subsidiaries have two departments: marketing and operations.

• Financial reporting is difficult due to data residing in disparate systems.
• Financial reporting is currently performed by using Microsoft Excel.
• Pre-orders in the current system are difficult to track because the order management
system is not integrated with the finance system.
• Pickle sales post to one revenue account, but this does not allow for targeted reporting
by pickle cut and type.

Current environment. Organization

The following chart shows Accounting/Reporting Currencies and Tax ID, if applicable.
 • Typically, vendor invoices are received prior to receipt of product.
• The following fixed assets are sold for a loss:
1. BUILD-100
2. CAR-1233
• At the regional distribution centers, the value for physical inventory does not match
the inventory in the financial system.
• Munson’s rents their corporate office. Rent is not paid by purchase order. Rent is due
once a quarter.
• Allocations are performed manually.
• Barrels are inventoried by site and warehouse.
• Munson’s has multiple depreciation and tax books for all of their fixed asset
equipment.
• Budgets are posted at the department level for each legal entity.

Requirements. Sales

• Customers should be able to pre-order for fall release of pickles.

• Three-way matching must be enforced for all purchases.
• Fixed asset sale transactions require a ledger account entered at the time of
transaction.
• Fixed assets purchased must be automatically created in fixed asset module. This
includes inventory items and write in purchase orders/non-inventoried items.
• One dollar from every sale must be tracked and donated at the end of each month to a
charitable organization.
• Purchasing budgets must be enforced at the main account level.

Requirements. Finances

• Accounts payable must be able to enter vendor invoices on the day they were received
to be settled against when product is received.
• Accounts payable must be able to enter vendor invoices to accrue expense without
specifying a purchase order at the time of entry.
• Postage expenses must be split evenly across the regional distribution centers
automatically.
• Administrative expenses must be distributed across the regional distribution centers
by percentage of fulfillment orders monthly.
• Pickling machines depreciation must be uniquely recorded for visibility but not post
to the ledger.

Issues

• During implementation testing, User1 indicates that after packing slips are generated
for purchase orders, there are no ledger postings.
 • User2 indicates that fixed assets purchased on a purchase order do not show up in the
Fixed Assets module.
• User3 reports that they are seeing inconsistent application of the one-dollar donation
from all sales orders.
• User4 in the Canadian subsidiary is able to purchase supplies for marketing despite
exceeding the marketing department budget.
• User5 reports that when purchasing a non-inventoried computer, the system is
automatically assigning it to the buildings fixed asset group.

You need to identify the root cause for the error that User5 is experiencing.

What should you check?

A. Fixed asset rules

B. Fixed asset determination rules
C. Fixed asset posting profiles
D. Fixed asset books
E. Fixed asset depreciation profiles

Answer: B

QUESTION NO: 183 DRAG DROP

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Munson’s Pickles and Preserves Farm grows and distributes produce, jellies, and jams. The
company’s corporate headquarters is located in Dallas, TX. Munson’s has one operations
center and seven regional distribution centers in the United States.

The company has two wholly owned subsidiaries that operate in Canada. The Canadian entity
owns an entity in France.

Munson’s plans to expand into Latin America by purchasing the last 25 percent of a
subsidiary that they own in Costa Rica. This process is expected to complete within the next
two years.

The company plans to implement Dynamics 365 Finance and Dynamics 365 Supply Chain to
meet their growing business needs.

Current environment. General

Munson’s uses a mix of internally-developed legacy systems that handle their finance and
distribution activities. The company has an isolated CRM system.

• Both Canadian subsidiaries have two departments: marketing and operations.

• Financial reporting is difficult due to data residing in disparate systems.
• Financial reporting is currently performed by using Microsoft Excel.
• Pre-orders in the current system are difficult to track because the order management
system is not integrated with the finance system.
• Pickle sales post to one revenue account, but this does not allow for targeted reporting
by pickle cut and type.

Current environment. Organization

The following chart shows Accounting/Reporting Currencies and Tax ID, if applicable.

• Typically, vendor invoices are received prior to receipt of product.

• The following fixed assets are sold for a loss:
1. BUILD-100
 2. CAR-1233
• At the regional distribution centers, the value for physical inventory does not match
the inventory in the financial system.
• Munson’s rents their corporate office. Rent is not paid by purchase order. Rent is due
once a quarter.
• Allocations are performed manually.
• Barrels are inventoried by site and warehouse.
• Munson’s has multiple depreciation and tax books for all of their fixed asset
equipment.
• Budgets are posted at the department level for each legal entity.

Requirements. Sales

• Customers should be able to pre-order for fall release of pickles.

• Three-way matching must be enforced for all purchases.
• Fixed asset sale transactions require a ledger account entered at the time of
transaction.
• Fixed assets purchased must be automatically created in fixed asset module. This
includes inventory items and write in purchase orders/non-inventoried items.
• One dollar from every sale must be tracked and donated at the end of each month to a
charitable organization.
• Purchasing budgets must be enforced at the main account level.

Requirements. Finances

• Accounts payable must be able to enter vendor invoices on the day they were received
to be settled against when product is received.
• Accounts payable must be able to enter vendor invoices to accrue expense without
specifying a purchase order at the time of entry.
• Postage expenses must be split evenly across the regional distribution centers
automatically.
• Administrative expenses must be distributed across the regional distribution centers
by percentage of fulfillment orders monthly.
• Pickling machines depreciation must be uniquely recorded for visibility but not post
to the ledger.

Issues

• During implementation testing, User1 indicates that after packing slips are generated
for purchase orders, there are no ledger postings.
• User2 indicates that fixed assets purchased on a purchase order do not show up in the
Fixed Assets module.
 • User3 reports that they are seeing inconsistent application of the one-dollar donation
from all sales orders.
• User4 in the Canadian subsidiary is able to purchase supplies for marketing despite
exceeding the marketing department budget.
• User5 reports that when purchasing a non-inventoried computer, the system is
automatically assigning it to the buildings fixed asset group.

You need to select the functionality to meet the requirement.

Which features should you use? To answer, drag the appropriate features to the correct
requirements. Each feature may be used once or not at all. You may need to drag the split bar
between panes or scroll to view content.

NOTE: Each correct selection is worth one point.

Answer: <map><m x1="28" x2="227" y1="67" y2="102" ss="0" a="0" /><m x1="29"
x2="227" y1="109" y2="144" ss="0" a="0" /><m x1="29" x2="226" y1="152" y2="188"
ss="0" a="0" /><m x1="582" x2="779" y1="110" y2="144" ss="1" a="0" /><m x1="582"
x2="780" y1="155" y2="189" ss="1" a="0" /><c start="1" stop="0" /><c start="2" stop="1"
/></map>
Explanation:

Reference:
https://www.mscloudexperts.com/how-to-set-up-fixed-assets-to-register-transactions-in-
posting-layers/
QUESTION NO: 184

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.

To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Alpine Ski House has three partially owned franchises and 10 fully owned resorts throughout
the United States and Canada. Alpine Ski House’s percentage ownership of the franchises is
between two and 10 percent.

Alpine Ski House is undergoing an implementation of Dynamics 365 Finance and Dynamics
365 Supply Chain Management to transform their financial management and logistics
capabilities across the franchises. Implementation is complete for Alpine Ski House’s
corporate offices, two US franchises, and one Canadian franchise. The remaining franchises
are in varying stages of the implementation. Two new resort projects are in the budget
planning stages and will open in the next fiscal year.

Current environment
Organization and general ledger

• Each franchise is set up as a legal entity in Dynamics 365 Finance.

• Alpine Ski House Corporate uses financial dimensions for their fully owned resorts.
• Each resort is a financial dimension named resort.
• Each fully owned resort has two divisions: marketing and operations.
• Only Profit and Loss account postings require the division dimension.
• Corporate handles the advertising and administration of the fully owned resorts.
• Corporate uses Dynamics 365 Project Management and Accounting to manage
construction of new resorts.

Budgeting

• Organizational budgeting is decentralized but rolls up to one organizational corporate

budget.
• Each resort manager performs budgeting in Dynamics 365 Finance.
• Budget preparation begins this month. All operational resorts will submit their
budgets in two weeks.

Sales and tax

• Sales tax is configured and used by all resorts that operate in the United States.
• You configure one US sales tax vendor account and assign the vendor account to the
settlement periods for reporting.
• You use accounts receivable charges to track donations.

Existing purchasing contracts

• Each franchise resort has an individual contract with a local supplier of their choosing
to purchase at least $10,000 worth of suppliers during the calendar year.
• The franchise resorts in one US state receive a two percent discount on meat and
vegetable purchases in excess of $8,000 per year.
• A franchise resort in Utah has agreed to purchase 1,000 units of beef at market price
from a local supplier.
• Alpine Ski House uses a vendor collaboration portal to track purchase orders and
requests for quotes.
• Vendors request access to the vendor collaboration portal by using a workflow which
runs on a nightly schedule.

Intercompany setup
Vendor123 resides in US franchise Company1 and is set up for intercompany transactions.
Customer345 resides in Canada franchise Company1 and is set up for intercompany
transactions.

Requirements

Franchises

• Each franchise must pay two percent of monthly sales to Alpine Ski House Corporate.
• Each franchise must report their own financials to Alpine Ski House Corporate
monthly.
• US franchises require a three-way-match on all purchases, with a 1-percent price
tolerance.
• Canadian franchises require a three-way-match on all purchases except paper
products, which have a 10-percent price tolerance.

Corporate

• Advertising costs must be balanced across the 10 resorts monthly. These costs must
be split across the 12 resorts once construction of the final two resorts is completed.
• Administration costs must be split across the 10 resorts proportional to the amount of
sales generated.
• One percent of all pack and individual ski pass sales must be donated quarterly to an
environmental protection organization.
• The finance department must be able to see purchasing contracts and discounts for
vendors based on volume spend.

Employees

All employee expense reports that contain the word entertainment must be reviewed for
audit purposes. If a journal is posted incorrectly, the entire journal and not just the incorrect
line must be fully reversed for audit purposes.

Resorts

All resorts must use Dynamics 365 Finance for budgeting and must first be approved by the
regional manager. Purchased fixed assets must automatically be acquired at product receipt.

Issues

• User1 reports that irrelevant dimensions display in the drop down when entering a
General journal.
• User2 reports that dimension 00 is being used for all balance sheet accounts.
 • User3 tries to generate the quarterly sales tax liability payment for a specific state but
does not see any payables available for that state’s vendor.
• User4 receives a call from a vendor who cannot access the vendor collaboration portal
but needs immediate access.
• User5 notices a large amount of entertainment expenses being posted without an audit
review.
• User6 needs to have visibility into the increase in budget that is necessary to staff the
two new resorts opening next year.
• User7 needs to use Dynamics 365 Finance for situational budgeting planning with the
ability to increase and decrease the existing plans by certain percentages.
• User8 made a mistake while posting a 1,000-line journal and reverses the entire
journal but cannot find the lines that included errors during the reversal.
• User9 made a mistake while posting a 55-line journal and reverses the entire journal.
• User10 realizes that the purchase of five new computers did not acquire five new
fixed assets upon receipt.

You need to acquire the fixed assets that are associated with the purchase orders.

What should you do?

A. Select the fixed asset checkbox on the invoice.

B. Create the fixed assets in the fixed asset module and then acquire the asset.
C. Create the fixed assets in the fixed asset module and then select the fixed asset checkbox
on the product receipt.
D. Reverse the product receipt and then repost it.

Answer: A

Reference:
https://docs.microsoft.com/en-us/dynamics365/finance/fixed-assets/acquire-assets-
procurement

QUESTION NO: 185

Case study

This is a case study. Case studies are not timed separately. You can use as much exam
time as you would like to complete each case. However, there may be additional case
studies and sections on this exam. You must manage your time to ensure that you are able to
complete all questions included on this exam in the time provided.
To answer the questions included in a case study, you will need to reference information that
is provided in the case study. Case studies might contain exhibits and other resources that
provide more information about the scenario that is described in the case study. Each
question is independent of the other questions in this case study.

At the end of this case study, a review screen will appear. This screen allows you to review
your answers and to make changes before you move to the next section of the exam. After
you begin a new section, you cannot return to this section.

To start the case study

To display the first question in this case study, click the Next button. Use the buttons in the
left pane to explore the content of the case study before you answer the questions. Clicking
these buttons displays information such as business requirements, existing environment, and
problem statements. If the case study has an All Information tab, note that the information
displayed is identical to the information displayed on the subsequent tabs. When you are
ready to answer a question, click the Question button to return to the question.

Background

Fourth Coffee is a coffee and supplies manufacturer based in Seattle. The company recently
purchased CompanyA, based in the United States, and CompanyB, based in Canada, in order
to increase production of their award-winning espresso machine and distribution of their dark
roast coffee beans, respectively.

Fourth Coffee has set up CompanyA and CompanyB in their Dynamics 365 Finance to gain
better visibility into the companies’ profitability. CompanyA and CompanyB will continue to
operate as subsidiaries of Fourth Coffee, but all operational companies will be consolidated
under Fourth Coffee Holding Company in US dollars (USD) for reporting purposes.

The current organizational chart is shown below:

Current environment

Systemwide setup
 • Dynamics 365 Finance in Microsoft Azure is used to manage the supply chain, retail,
and financials.
• All companies share a Chart of Accounts.
• Two dimensions are used: Department and Division.
• Budgeting is controlled at the department level.
• Customers and vendors are defined as two groups: Domestic and International.
• Mandatory credit check is set to No.
• Consolidate online is used for the consolidation of all companies.
• International main accounts are subject to foreign currency revaluation.
• The purchasing budget is used to enforce purchasing limits.

General ledger accounts

Fourth Coffee

• The base currency is USD.

• Three item groups are used: coffee, supplies, and nonstock.
• The standard sales tax method is used.
• Acquiring fixed assets requires a purchase order.
• All customer payment journals require a deposit slip.
• CustomerX is a taxable company.
• CustomerY is a tax-exempt company.
• CustomerZ is a taxable company.
• VendorA is a Colombian supplier of coffee beans and belongs to the international
vendor group.
• VendorB is a Peruvian supplier of coffee machine filters and belongs to the
international vendor group.
• VendorC is a Texas supplier of espresso valves and belongs to the domestic vendor
group.

CompanyA

• The base currency is USD.

• It consists of a marketing department and a digital division.
• A 4-5-4 calendar structure is used.
• The standard sales tax method is used.
CompanyB

• The base currency is CAD.

• The conditional sales tax method is used.

Requirements

Reporting

• A consolidated Fourth Coffee financial report is required in USD currency.

• Fourth Coffee and its subsidiaries need to be able to report sales by item type.
• Year-end adjustments need to be reported separately in a different period to view
financial reporting inclusive and exclusive of year-end adjustments.

Issues

• User1 observes that a General journal was used in error to post to the Domestic
Accounts Receivable trade account.
• User2 has to repeatedly reclassify vendor invoice journals in Fourth Coffee Company
that are posted to the marketing department and digital division.
• When User3 posts an Accounts receivable payment journal, a deposit slip is not
generated.
• User4 observes an increase in procurement department expenses for supplies.
• User5 observes that sales tax is not calculating on a sales order for CustomerZ.
• User6 observes that sales tax is calculating for CustomerY.
• User7 observes that the sales tax payment report is excluding posted invoice
transactions.
• User8 in CompanyA attempts to set up the sales tax receivable account on the sales
tax posting form.
• User9 in CompanyA needs to purchase three tablets by using a purchase order and
record the devices as fixed assets.
• CustomerX requires a credit check when making a purchase and is currently at their
credit limit.

You need to ensure that User9's purchase is appropriately recorded.

Which three steps should you perform? Each correct answer presents part of the solution.

NOTE: Each correct selection is worth one point.

A. Select a fixed asset group at the line level.

B. Set the new fixed asset toggle to yes at the line level.
C. Enter three purchase order lines, enter quantity of 1.
D. Enter one purchase order line, enter quantity of 3.
E. Select a financial dimension at the line level.

Answer: A, B, C

Reference:
https://www.columbusglobal.com/en-us/blog/how-to-purchase-a-fixed-asset-through-a-po-
with-dynamics-365