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CFI CBCA Core Course Assessments & Quizzes, Exams of Advanced Education

Cheyney University of PennsylvaniaAdvanced Education

CFI CBCA Core Course Assessments & Quizzes

Typology: Exams

2025/2026

Available from 06/04/2026

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CFI CBCA Core Course Assessments & Quizzes
1. What is the main goal of using business writing fundamentals?:
To
reduce mental
ettort
2. Which of the following statements describes a "Capacity" strength
or weak-
ness
for
a
company
in
the
5
Cs
of
credit
framework?:
The net profit
margin ratio is high.
3. Which of the following statements describes a "Condition" strength
or weak-
ness for a company in the 5 Cs of credit framework?: The risks
associated with the industry
are high.
4. Which of the following scenarios would NOT be considered a
strength when assessing the management team as part of
evaluating a company's charac-
ter?:
Financial reports are not widely shared and
performance measures have not been identified.
5. Which of the following ratios most likely indicates strong
"Capacity" for a
company?:
High asset turnover ratio
6. Select the correct formula to calculate the operating margin ratio.:
Operating
Margin Ratio = EBIT / Revenue
7. Select the correct formula to calculate the inventory turnover ratio.:
Inventory
Turnover Ratio = Cost of Goods Sold / Average Inventory
8.
Which of the following most likely indicates strong "Capital" for a
company?-
:
Unutilized
lines
of
credit
or
loans
9. Which of the following statements on collateral is NOT correct?:
Collateral can be
used as the main determinant of a credit decision.
10. Which of the following tools or methods is used to assess
the general business environment?: PEST analysis
11.
Select the loan contract with the lowest risk.: A demand loan with
monthly payments
secured by assets
12. Which is not one of the three main financial statements?:
pf3
pf4
pf5
pf8
pf9
pfa
pfd
pfe
pff
pf12
pf13
pf14
pf15
pf16
pf17
pf18
pf19
pf1a
pf1b
pf1c
pf1d
pf1e
pf1f
pf20
pf21
pf22
pf23
pf24
pf25
pf26
pf27

Partial preview of the text

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CFI CBCA Core Course Assessments & Quizzes

  1. What is the main goal of using business writing fundamentals?: To reduce mental ettort
  2. Which of the following statements describes a "Capacity" strength or weak-ness for a company in the 5 Cs of credit framework?: The net profit margin ratio is high.
  3. Which of the following statements describes a "Condition" strength or weak-ness for a company in the 5 Cs of credit framework?: The risks associated with the industry are high.
  4. Which of the following scenarios would NOT be considered a strength when assessing the management team as part of evaluating a company's charac-ter?: Financial reports are not widely shared and performance measures have not been identified.
  5. Which of the following ratios most likely indicates strong "Capacity" for a company?: High asset turnover ratio
  6. Select the correct formula to calculate the operating margin ratio.: Operating Margin Ratio = EBIT / Revenue
  7. Select the correct formula to calculate the inventory turnover ratio.: Inventory Turnover Ratio = Cost of Goods Sold / Average Inventory
  8. Which of the following most likely indicates strong "Capital" for a company?- : Unutilized lines of credit or loans
  9. Which of the following statements on collateral is NOT correct?: Collateral can be used as the main determinant of a credit decision.
  10. Which of the following tools or methods is used to assess the general business environment?: PEST analysis
  11. Select the loan contract with the lowest risk.: A demand loan with monthly payments secured by assets
  12. Which is not one of the three main financial statements?:

2 / 39 Statement of equity

  1. What does the balance sheet indicate?: The financial strength of the business
  2. Financing activities: Issuing shares and bonds
  3. Operating activities: Payments to suppliers; Depreciation and amortization expense
  4. Investing activities: Buying and selling equipment
  5. Which is not a section in the financial statement note disclosures?: Management discussion and analysis
  6. Balance Sheet: Retained earnings; Share captial
  7. Income Statement: Rent expense
  8. Cash Flow Statement: Sale of property, plant and equipment
  9. If a company has net assets equal to $3.25 million but is sold for $5.35 mil-lion, how much goodwill does the acquirer record on their balance sheet?: $2.1 million
  10. Intangible assets: Items of value, which have no physical substance, that are used to generate revenues
  11. Authorized shares: The total number of shares a company can sell
  12. Contingencies: Events that may or may not happen, depending on certain circumstances
  13. Commitments: Future obligations that a company has agreed to
  14. If a company issues 60,000 shares at $0.25 each but the shares have a par value of $0.20 each, what is the resulting contributed surplus?: $3,
  15. What line item is not found in the statement of shareholders' equity?: Debt issued or repurchased
  16. What is not true about a partnership?: Partners cannot be held liable for a debt
  17. Which line item usually accounts for direct labor?: Cost of goods sold
  18. Select the statements below which are true. Select all that apply.: Depreciation and amortization are non-cash expenses; A company can be profitable but experience negative cash flows

4 / 39 over 70 hours for the past couple weeks, due to a high volume of customer orders. According to the Hours of Service regulations, all commercial drivers may not drive after 60 hours on duty in 7 consecutive days and may only restart after taking 34 or more consecutive hours off duty. (Source: https://www.fmcsa.dot.gov/regulations/hours- service/summa-ry-hours-service-regulations): Legal factors

  1. When competition within an industry is high, which of the following is most likely to be true?: Buyers have high bargaining power
  2. Which of the following is most likely true for companies at the maturity stage of the industry lifecycle?: Sales > Cash Flow > Profit
  3. According to the growth/share matrix, companies at maturity have:: Low market growth and high market share
  4. At which stage of the firm lifecycle would a company most likely have high business risk, low financial risk, and generate neutral net cash flow?: Growth
  5. Read the following passage and determine which of the following strate-gies the business uses in creating solid relationship with its customers. Innovation Co. is an international smartphone manufacturer which currently holds more than 15% of global smartphone market share. One of the superior product features it offers (seamless integration with any smart devices includ-ing televisions, smart home electronics, and home assistance) is the selling point of the company's latest smartphone series, creating a huge competitive advantage over its competitors. This premium feature also allows Innovation Co. to charge an above-average price while maintaining a loyal customer base.: Best product
  6. Which of the following strategies describes a company's attempt to enter into new markets with its existing products?: Market development
  7. Which of the following strategies describes a company's

5 / 39 attempt to enter into new markets with new products?: Diversification

  1. According to the course, which is the most important section of the busi-ness plan?: Executive Summary
  2. In which section of a business plan can you find the name of the company's lawyer? Select the best answer.: Company Description
  3. Which SMART component is the following goal missing? In 2020, Company ABC's Canadian operations generated $90M of revenue, and in 2021 the Canadian operations generated $98M of revenue. Their goal is to achieve $100M of revenue in their Canadian operations in the near future.: Timely
  4. Where would you most likely find information regarding the hierarchical or flat structure of the organization? Select the best answer.: Management and Operations
  5. What is a benefit of having a small number of suppliers for a company's products?: Better relationship which can result in better repayment terms
  6. Which risks may be associated with the location of a firm's operations? Select all that apply.: Regulatory risk, Foreign exchange risk, Geo-political risk
  7. Company XYZ sells women's running shoes in two U.S. states. Which option would be considered their SAM (Serviceable Attainable Market)?: The demand of women's running shoes in the two U.S. states
  8. Company A sells bottled soft drinks in Australia. Which of the following answers best describes a threat to company A according to a SWOT analysis?- : Customers are purchasing more gym memberships and are becoming more focused on their health
  9. Company B is a technology company which primarily sells products to mid-dle-class individuals. If the average middle-class income falls, which PESTEL factor would be affected?: Economic
  10. When a company is developing their outlook through

7 / 39 flow?: Purchase PP&E

  1. Which of the following strategies is most likely to shorten the working capital funding gap?: Extend payments to suppliers
  2. Calculate accounts receivable days based on the information below: Revenues: 2,500, Costs of goods sold: 1,600,000 Days in period: 365 Receivables: 300, Inventories: 150, Payables: 200,000: 43.8 = (AR/Revenue)*Number of days in year
  3. What's the company's working capital funding gap in days based on the information below? Receivable days: 47. Inventory days: 34. Payable days: 45. Days in the period: 365: 36.1 days = inventory days + receivable days - payable days
  4. Based on the information below, how much does the company need to finance the working capital funding gap and how much is the lender willing to provide? Funding gap (days) 35 Days in period 365 Revenues 2,500, Cost of goods sold 1,600, Receivables balance 300,000 Up to 50% Inventories balance 150,000 Up to 50%: Financing Required = 153,425 = Cost of goods sold * Funding gap (days) / Days in period Financing Allowed = 225,000 = Receivables + Inventories
  5. The cash conversion cycle measures:: The number of days it takes for a company to turn its resource inputs into cash
  6. Calculate the ROI based on the cash flows of each year:

8 / 39 2020 Cash Flows - $2,000 2021 Cash Flows $100 2022 Cash Flows $300 2023 Cash Flows $500 2024 Cash Flows $ 2025 Cash Flows $900: ROI = 25% = 2025 Cum. Cash Flows / Minimum Cum. Cash Flows

  1. Calculate the net cash provided by the operating activities based on the information below: Net income: 60, Depreciation: 25, Increase in accounts receivable: 12,000 Increase in inventory: 8, Increase in accounts payable: 15,000: 80,000 = Net Income + Depreciation - Increase in accounts receivable - Increase in inventory + Increase in accounts payable
  2. Calculate the total capital expenditure of 2018 based on the information below: 2017 PP&E: 43, 2018 PP&E: 65, 2017 Depreciation: 10, 2018 Depreciation: 12,000: = 34,000 = 2018 PP&E - 2017 PP&E + 2018 Depreciation
  3. Calculate the company's free cash flow for the current year based on the information below: Net income: 60, Depreciation: 25, Increase in accounts receivable: 12,000 Increase in inventory: 8, Increase in accounts payable: 15,000 Capital expenditures: 45, Increase in long-term debt: 15,000: Cash from Operations = Net income +

10 / 39 always use figures based on a fully drawn operating line

  1. When a credit analyst is reviewing a borrowing request, it can get complex when multiple credit facilities are involved. Why is a sources and uses of funds table important for an analyst when reviewing the request? Select ALL that apply..: It will allow for a lender's adjudication team to evaluate the borrowing request more clearly; It will permit clearer discussions with the borrower's management team around the borrowing request

11 / 39

  1. For owner-operated borrowers, which of the following statements is true with respect to understanding management compensation when calculating debt service coverage?: The analyst must adjust EBITDA for any drawings considered "non-discretionary". Removing these dividends will reduce the debt service coverage ratio.
  2. Given the table below, calculate the annual debt service obligation using the PMT function in Microsoft Excel: Loan Amount $75, Interest Rate 4.75% Periods (Term in Years) 6 Compounding Periods per Year 1 Monthly Payment?: = $14,658.
  3. What would a low AR days number, compared to the industry, mean for a company?: Receivables are being collected eflciently, and customers are paying their debts quickly.
  4. Which of the following statements are true when completing a horizontal analysis?: Horizontal analysis is usually performed after vertical analysis. This analysis can be used to better project future performance and solvency. Analysis can reveal things such as consistent records of sales, or profitability growth.
  5. Which of the following statements are true when completing a horizontal analysis? Select ALL that apply.: Protect inputs by locking input cells
  6. Complex financial models are all of the following EXCEPT:: They are easy to follow and audit
  7. Forecast the 2019 Cost of goods sold on the previous year's number and the assumptions 2018 Actual Sales Growth 6%

13 / 39 Sales Growth 8% Gross Margin 40%: = 32,

  1. Forecast the accounts receivable for Company XYZ using the following annual information. Receivable days assumption = 55 days Payable days assumption = 69 days Forecasted revenue = $263, Forecasted cost of goods sold = $114,780: = 39,705 = Receivable days assumption*Forecasted revenue/365 days
  2. What formula below can be used to forecast inventory?: = Inventory days * Cost of sales / 365
  3. Which of the following items can be found in a published cash flow state-ment under "operating activities"? Select ALL correct answers.: Changes in operating assets and liabilities, Depreciation
  4. What is the total cash from operating activities based on the information below? Net income: 500 Depreciation: 80 Increase in receivables: 100 Increase in inventory: 50 Increase in payables: 60: = 490 = Net income + Depreciation - Increase in receivables - Increase in inventory + Increase in payables
  5. Calculate the end of the year cash balance based on the information below: Beginning of the year cash balance: 2, Net income: 300 Depreciation: 140 Increase in accounts payable: 60 Acquisitions of PP&E: 580 Dividends paid in the current year:

14 / 39 130 Increase in long-term debt: 200: = 1,

  1. Which Excel function or tool will you use to display the cells that are referred to by a formula in the selected cell?: Trace Precedents

16 / 39 information below? Depreciation (percent of sales): 4% Revenues: 60, Gross profit: 25, PP&E: 40,000: = 2,400 = Depreciation (percent of sales)*Revenues

17 / 39

  1. What's the forecasted EBIT based on the information below? Revenues: 56, Cost of goods sold: 32, SG&A: 8, Depreciation: 2, Interest: 1, Taxes: 3,800: = 12,800 = Revenues - Cost of goods sold - SG&A - Depreciation
  2. Select ALL the direct securities from the list below.: Inventory, buildings, intellectual property
  3. Which of the following does NOT describe the fixed charge of security?: The borrower can trade its assets unless there's a default on the loan payment.
  4. Which of the following does describe the fixed charge of security?: Securities with fixed charges are usually made up of non-current assets; The financial institute has the legal rights to the asset; The financial institute can take possession of the asset to settle the debt in case of loan default.
  5. Which of the following is typically used as floating charge security?: Accounts receivable
  6. Which of the following is NOT typically used as floating charge security?: - Machinery, land, letter of comfort
  7. If a loan is secured by a limited corporate guarantee, what will happen when the borrower is unable to repay the debt?: The lender has the right to pursue the assets of the company within a specific dollar amount.
  8. Which of the following security assets are considered personal property? Select ALL correct answers.: Bonds and equities, Consumer goods
  9. Which of the following security assets are NOT considered personal prop-erty? Select ALL correct answers.: Land, Factories, Oflce buildings
  10. Which of the following may indicate low-quality inventory?: There is a limited shelf-life
  11. Which of the following is NOT an aspect to consider when

19 / 39

  1. Which is a typical source of information used in ascertaining the value of the real property?: Real estate listings
  2. It is the legal counsel's responsibility to: (Select ALL correct answers): Ensure that the security is properly registered. Advise the borrower that the lender can pursue all their assets in the event of default.
  3. Which of the following is NOT correct on security registration and doc-umentation?: It is the borrower's responsibility to ensure that the loan security documentation is properly completed and registered.
  4. Which of the following are correct on security registration and documenta-tion?: Common Security documentations include mortgage appraisal, assignment of leases and rents, and general security agreement. The registration of the security is done ditterently in various jurisdictions around the world. It is the lender's responsibility to ensure all loans are adequately secured.
  5. Which of the following is NOT a benefit of including covenants in a loan agreement?: Covenants protect lenders by reducing their financial loss in the event of default.
  6. Which of the following is a benefit of including covenants in a loan agree-ment?: Covenants restrict borrowers from taking actions that can increase the risk for the lenders; Covenants provide borrowers with clear expectations of the lenders; Covenants reduce the cost of borrowing because lenders are more willing to provide a lower interest rate when they can impose restrictions.
  7. Select ALL the non-financial covenants from the list.: The company cannot change its business operations; The company must maintain minimum insurance coverage of 2 million.
  8. Select the correct formula to calculate the quick ratio.: Quick Ratio = (Cash & Equivalents + Marketable Securities + Accounts Receivable) / Current Liabilities
  9. Select the correct formula to calculate the working capital ratio.: Working Capital Ratio = Current Assets / Current Liabilities
  10. Which of the following scenarios is most likely to indicate high lending risk?: Low interest coverage ratio

20 / 39

  1. What is the best next step when there is a breach of a loan covenant?: In-vestigate why the breach happened
  2. Calculate debt service coverage ratio (using EBITDA instead of EBIT) based on the company's financial information below: Net Operating Profit: 12,