Microsoft

MB-700 Free Practice Questions

This is the free Microsoft MB-700 practice question bank — 160 of 305 total questions, each with a full explanation, free to read with no signup required. Updated 2026-04-24.

Every answer is verified against official Microsoft documentation — see our methodology.

Question 1

HOTSPOT - A company is planning a Dynamics 365 Supply Chain Management implementation. The company expects that a high number of customizations will be required due to the nature of its business. The company has the following requirements for the customizations: • Code that is written must not create issues with any future service updates. • Models that contain code must simplify the application lifecycle management (ALM) strategy. You need to define the code management strategy. Which actions should you use in the strategy? To answer, select the appropriate options in the answer area. NOTE: Each correct selection is worth one point.

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Correct Answer: Use extensions. Deploy in its own package.
Explanation:
Extensions avoid overlayering, which prevents conflicts during service updates. Placing custom code in its own model/package isolates changes and simplifies ALM, versioning, and maintenance.

Question 1

HOTSPOT - A United States-based company has a cloud-based Dynamics 365 Finance implementation. The company plans to open a new location in Mexico. Electronic invoicing is mandated in Mexico. You need to recommend a solution that meets Mexican localization reporting requirements. What should you recommend? To answer, select the appropriate options in the answer area. NOTE: Each correct selection is worth one point. Hot Area:

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Correct Answer: Implement localization: Select Mexico for the localized functionality region field. Configure company: Create a new legal entity with MEX as the country code. Identify gaps: Identify the reporting format requirement and analyze Dynamics 365 for supporting functionality.
Explanation:
Mexican electronic invoicing (CFDI) requires Mexican localization features, which are enabled by selecting Mexico as the localized functionality region. Compliance requires a separate Mexican legal entity (country code MEX) to meet statutory, currency, and tax requirements. Finally, CFDI mandates specific formats and integrations, so reporting requirements must be identified and validated against available Dynamics 365 functionality.

Question 2

A company plans to use Dynamics 365 Finance and Supply Chain Management. The company’s implementation will include legal entities in the United States and France. The company has a large operational team and a finance team composed of five employees. The finance team needs to permanently close each financial period on the last day of the month through an automated process that flags tasks as complete. You need to complete the gap fit analysis for the requirement. Which two feasibility principles should you use? Each answer presents a complete solution. (Choose two.) NOTE: Each correct selection is worth one point.

A. Is it technically feasible?
B. Will people use it?
C. Evaluate the business process
D. Regulatory rules and laws
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Correct Answer: A, C
Explanation:
The requirement is about automating the permanent close of financial periods in Dynamics 365. In a gap fit analysis, you assess whether the requirement can be supported by the system and how it aligns with standard processes. Therefore, you must determine if it is technically feasible in Dynamics 365 Finance (A) and evaluate the business process to see whether standard functionality or configuration meets the need (C). User adoption and regulatory rules are not the primary feasibility principles for this specific requirement.

Question 3

DRAG DROP - A company uses Dynamics 365 Finance. An application support manager has two issues that have been identified in the production environment. They found the issues in Issue search and with a quick glance, observe the following color coding for the issue status: • Issue 1 is Brown • Issue 2 is Green You need to recommend an action for each issue in Issue search. Which action should you recommend for each issue? To answer, move the appropriate action to the correct issue. You may use each action once, more than once, or not at all. You may need to move the split bar between panes or scroll to view content. NOTE: Each correct selection is worth one point.

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Correct Answer: Issue 1 (Brown): Implement the provided workaround. Issue 2 (Green): Download and install the hotfix.
Explanation:
In LCS Issue search, Brown indicates a known issue without a released fix, so a workaround is recommended. Green indicates a fix is available, so the hotfix should be downloaded and installed.

Question 4

DRAG DROP - A company plans to migrate from AX 2012 to Dynamics 365 Finance. The internal financial auditors have identified a risk of AX 2012 no longer being a supported platform. The chief financial officer wants to minimize this risk as quickly as possible by moving to Dynamics 365 Finance and does not understand the difference between upgrading and reimplementing. You need to identify the implementation type for each value driver. Which implementation type should you identify for each value driver? To answer, move the appropriate implementation type to the correct value driver. You may use each implementation type once, more than once, or not at all. You may need to move the split bar between panes or scroll to view content. NOTE: Each correct selection is worth one point.

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Correct Answer: Keeps transactional history → Upgrade only Implements Microsoft 365 Copilot features → Reimplement only
Explanation:
An upgrade from AX 2012 preserves full transactional history using Microsoft’s upgrade tools, minimizing risk and time. Copilot capabilities are aligned with adopting standard, modern processes and clean configurations, which are typically achieved through a reimplementation rather than a technical upgrade.

Question 5

DRAG DROP - A company plans to upgrade from AX 2012 to Dynamics 365 Finance. You are planning the end-to-end upgrade. The upgrade must follow Microsoft recommendations. You need to identify the phase for each activity. Which phase should you use for each activity? To answer, move the appropriate phase to the correct activity. You may use each phase once, more than once, or not at all. You may need to move the split bar between panes or scroll to view content. NOTE: Each correct selection is worth one point.

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Correct Answer: Perform AX 2012 preparation tasks: Execute Create cutover plan: Validate
Explanation:
AX 2012 preparation tasks are carried out during the Execute phase as part of performing the technical upgrade work. The cutover plan is defined in the Validate phase to prepare for production readiness and final go-live.

Question 6

HOTSPOT - You are preparing to complete a solution blueprint review and are reviewing business process documentation. You need to identify the deliverable related to each process. Which deliverable type should you identify for each deliverable definition? To answer, select the appropriate options in the answer area. NOTE: Each correct selection is worth one point.

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Correct Answer: Process flow Requirements traceability matrix Process catalog
Explanation:
A process flow shows a sequenced list of activities. A requirements traceability matrix links requirements through validation. A process catalog lists each business process with its inputs and outputs.

Question 7

A company plans to use Dynamics 365 Finance. The company gathers business requirements. The company must adhere to Success by Design implementation standards. You need to complete a gap fit analysis of the requirements. Which three factors should be included in the gap fit analysis? Each correct answer presents part of the solution. (Choose three.) NOTE: Each correct selection is worth one point.

A. regulations
B. schedule
C. level of effort
D. priority
E. severity of the category
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Correct Answer: C, D, E
Explanation:
In a Success by Design gap fit analysis for Dynamics 365 Finance, each identified gap is evaluated by its level of effort to address, its business priority, and the severity or impact category of the gap. These factors help determine feasibility and planning decisions. Schedule and regulations are not core gap fit evaluation factors in this context.

Question 8

DRAG DROP - A company plans to use Dynamics 365 Finance and Supply Chain Management. The company is preparing for cutover and is documenting a plan. You must review the cutover plan. You need to verify the post-go-live support documentation is complete and covers all applicable topics. Which topic does each statement support? To answer, move the appropriate topic to the correct statement. You may use each topic once, more than once, or not at all. You may need to move the split bar between panes or scroll to view content. NOTE: Each correct selection is worth one point.

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Correct Answer: Open tasks will be reassigned to the support desk three weeks post-go-live. Transition planning Verification of first shipment ledger postings. Cutover exit criteria
Explanation:
Reassigning tasks after go-live defines how responsibilities transition to steady-state support. Verifying initial ledger postings confirms cutover success and is required to formally exit cutover.

Question 9

You are a solution architect at a company that uses Dynamics 365 finance and operations apps. You define the company’s performance and load testing strategy. The company conducts all FastTrack workshops during the implementation. All topics FastTrack reviews in performance workshops must be included in the performance and load testing strategy. You need to identify the components to include in the strategy. Which two components should you include? Each correct answer presents part of the solution. (Choose two.) NOTE: Each correct selection is worth one point.

A. Key business scenarios
B. Rollout plan
C. Cutover strategy
D. Volumes
E. Gaps
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Correct Answer: A, D
Explanation:
FastTrack performance workshops focus on ensuring that the most important business processes perform acceptably at scale. Therefore, the strategy must include key business scenarios to define what processes are tested, and volumes to represent realistic transaction counts, data sizes, and user concurrency. Rollout plans, cutover strategies, and gaps are related to deployment or functional design, not performance and load testing.

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