HOTSPOT
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A company implemented Dynamics 365 Finance less than a year ago. A departments have exceeded their fiscal year budgets.
The following business rules must be implemented to keep the company’s spending on budget.
• Operations must be allowed to exceed budget.
• Marketing must receive warnings when they are over budget.
• Sales mast not exceed its budget.
• All departments must have a calculation in place to determine what they can spend.
• Budget funds do not need to be recorded in the general ledger.
You need to configure budget controls.
Which configuration option should you use? To answer, select the appropriate options in the answer area.
NOTE: Each correct selection is worth one point.
Show Answer
Correct Answer: Operations: Over budget permissions
Marketing: Message levels
Sales: Budget reservations for pre-encumbrances
All: Budget funds available
Explanation: Operations need permission to exceed budgets, which is controlled by over-budget permissions. Marketing should only receive warnings, handled by message levels. Sales must not exceed the budget, so pre-encumbrance reservations prevent commitments beyond available funds. All departments require a calculation of spendable amounts, which is provided by budget funds available. Budget amounts do not need to post to the general ledger.
Question 125
You are configuring revenue recognition reallocation processing in Microsoft Dynamics 365 Finance.
You must recalculate revenue prices when the contract terms for a sale change.
What are three characteristics of the revenue recognition reallocation process? Each correct answer presents a complete solution.
NOTE: Each correct selection is worth one point
A. The revenue recognition reallocation process cannot be run on project sales orders.
B. The revenue recognition reallocation process can be reversed after it is run.
C. You can run the revenue recognition reallocation process multiple times.
D. It multiple sales orders are involved, all sales orders must be for the same customer account.
E. The revenue recognition reallocation process can be run for sales orders with different transaction currencies.
F. The revenue recognition reallocation process can only be run one time. All changes must be finalized.
Show Answer
Correct Answer: B, C, D
Explanation: Revenue recognition reallocation in Dynamics 365 Finance is flexible and iterative. The process can be reversed if needed, allowing corrections after execution. It can also be run multiple times as contract terms change. When reallocating across multiple sales orders, all sales orders must belong to the same customer account to ensure correct allocation. The process is not limited to a single run, is not restricted to project sales orders, and does not support mixing different customers.
Question 126
You use Dynamics 365 Finance for daily bank reconciliation.
You must use the BAI2 bank statement format.
You need to configure the import bank statement format for the bank reconciliation process.
What should you do?
A. Import the bank statement as a template for the bank statement format.
B. Set up a batch job to import the bank statement.
C. Set up an import project for the bank statement in a Data management workspace using files provided by Microsoft.
D. Set up a journal name to import a bank statement transaction.
Show Answer
Correct Answer: C
Explanation: In Dynamics 365 Finance, advanced bank reconciliation imports (including BAI2) are configured through the Data management workspace. Microsoft provides predefined data entities and sample formats for bank statement imports such as BAI2. You must create an import project in Data management using these files to map and load bank statement data. The other options relate to processing or posting, not configuring the import format itself.
Question 127
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 wants general journals to be used only to post ledger-type transactions.
You need to set up journal configuration to achieve the requirement.
Solution: Set up posting restrictions on the general journal.
Does the solution meet the goal?
A. Yes
B. No
Show Answer
Correct Answer: B
Explanation: Posting restrictions on the general journal do not control the type of transactions (ledger-type vs. others) that can be entered. To restrict usage to ledger-type transactions, you must use journal names with appropriate journal controls. Therefore, the proposed solution does not meet the goal.
Question 128
The JAX sales tax group include the following tax codes:
• Jacksonville
• Duval CT
• FL
• FL Special 1
• FL Special 2
• FL Special 3
• FL Special 5
The default item sales tax group includes the following tax codes:
• Jacksonville
• Duval CT
• FL
• FL Special 1
• FL Special 2
• FL Special 3
• FL Special 4
• Lake Worth
• Palm Beach CT
You assign the JAX sales tax group as the sales tax group, and default item sales tax group on the sales order.
You need to select the tax code used for tax calculation on the sales order.
What should you choose?
A. Jacksonville - Duval CT - FL - FL Special 1 - FL Special 2 - FL Special 3 - FL Special 4 - Lake Worth - Palm Beach CT
B. Jacksonville - Duval CT - FL - FL Special 2 - FL Special 3 - FL Special 5
C. Jacksonville - Duval CT - FL - FL Special 1 - FL Special 2 - FL Special 3
D. Jacksonville - Duval CT - FL - FL Special 1 - FL Special 2 - FL Special 3 - FL Special 5
Show Answer
Correct Answer: C
Explanation: In Dynamics 365, the tax codes applied on a sales order are the intersection of the Sales tax group and the Item sales tax group. Only tax codes that exist in both groups are used for calculation. The common tax codes between the JAX sales tax group and the default item sales tax group are: Jacksonville, Duval CT, FL, FL Special 1, FL Special 2, and FL Special 3. Therefore, option C is correct.
Question 129
A company uses Microsoft Dynamics 365 Finance.
You need to reclassify a fixed asset.
Which three actions does the system perform when an asset is reclassified? Each correct answer presents part of the solution.
NOTE: Each correct selection is worth one point.
A. The system will generate reclassification journals.
B. The new books of the new fixed asset contain the date of the reclassification in the Acquisition date field.
C. All books for the existing fixed asset are created for the new fixed asset.
D. The existing fixed asset transactions for the original fixed asset are canceled and regenerated for the new fixed asset.
E. The new fixed asset only cancels out possible depreciations because the reclassification date is filled in in the Acquisition date field.
Show Answer
Correct Answer: A, B, C
Explanation: When a fixed asset is reclassified in Dynamics 365 Finance, the system creates reclassification journals to move balances, creates a new fixed asset with all books copied from the original asset, and sets the acquisition date of the new asset books to the reclassification date. The original asset’s historical transactions are not canceled and regenerated; they remain on the original asset and are offset through the reclassification journals.
Question 130
DRAG DROP
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A company uses Dynamics 365 Finance for expense management.
The company has multiple legal entities and multiple departments. Each department may have a different expense policy that may conflict with the legal entity expense policy.
You need to configure prioritization of department expense policy over legal entity expense policy.
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.
Show Answer
Correct Answer: 1. Create an organization hierarchy for the departments.
2. Add the department organization hierarchy to the Expenditure internal control organization hierarchy purpose.
3. Set the order of precedence in Policy parameters.
Explanation: Expense policies use organization hierarchies tied to the Expenditure internal control purpose. Creating a department hierarchy and assigning it to this purpose allows department-level policies, and setting policy precedence ensures department policies override legal entity policies.
Question 131
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. Delete any contact person that they have created.
Show Answer
Correct Answer: A
Explanation: The Vendor (external) role in vendor collaboration provides read-only access to collaboration data relevant to the vendor, including viewing consignment inventory. It does not grant permissions to manage contacts or control other users’ access, which are reserved for internal or higher-privileged roles.
Question 132
A customer implements Dynamics 365 Finance and wants to use the recurring invoice feature for accounts receivable.
The recurring invoice template includes the start date and frequency. However, when the Generate recurring invoices job processes, invoices are not created despite the criteria being met.
You need to ensure that invoices are generated.
What should you do?
A. Assign an invoice template to a customer on the invoice tab of the customer record.
B. Set the maximum billing amount on the recurring invoke template.
C. Associate a customer to the invoice template on the invoice template form.
D. Assign an invoice template to the customer posting profile.
Show Answer
Correct Answer: A
Explanation: Recurring free text invoices in Dynamics 365 Finance are generated only when a free text invoice template is assigned directly to the customer record. The Generate recurring invoices job looks for templates linked at the customer level (Accounts receivable > Customers > Invoice tab). Simply defining a template or linking it elsewhere will not trigger invoice generation.
Question 133
You have implemented Dynamics 365 Finance.
You must update the fiscal year to a 4-4-5 quarterly configuration.
You need to configure the fiscal year.
What should you do?
A. Set up the length of the period to 1 year and divide the period according to the quarterly configuration.
B. Configure the period length to 12 months and adjust the ending date of each period.
C. Configure the period length to 1 year and adjust the ending date of each period.
D. Set up the length of the period to 13 months.
Show Answer
Correct Answer: A
Explanation: In Dynamics 365 Finance, a 4-4-5 calendar is configured by keeping the fiscal year length as 1 year and dividing it into periods based on the quarterly 4-4-5 pattern. You do not define the year as 13 months; instead, you define period lengths within the one-year fiscal calendar to reflect the 4-4-5 structure.
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