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AFP Updated CTP Exam Questions and Answers by hendrix

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AFP CTP Exam Overview :

Exam Name: Certified Treasury Professional
Exam Code: CTP Dumps
Vendor: AFP Certification: AFP Certification
Questions: 1076 Q&A's Shared By: hendrix
Question 80

A U.S. based multinational company is filing its U.S. tax return and notes that its U.K. subsidiary had pre-tax income equal to $1 million. The U.K. subsidiary paid an effective tax rate on this income of 40%. If the U.S. tax rate is 34%, what will be the amount of the foreign tax credit on the U.S. tax return related to the U.K. income?

Options:

A.

$60,000

B.

$280,000

C.

$340,000

D.

$400,000

Discussion
Question 81

A multinational company owns a United Kingdom subsidiary that has total assets equal to £1 million and intercompany loans due to the parent company equal to $1 million. It would like to undertake a balance sheet hedge of the U.K. subsidiary’s GBP liability because it expects a depreciation of the pound. Given these circumstances, which of the following actions would be appropriate?

Options:

A.

Borrow GBP from a U.K. bank to repay the intercompany dollar debt.

B.

Borrow USD from a U.K. bank to repay the intercompany dollar debt.

C.

Take no action because exchange rates cannot be predicted.

D.

Exchange rates are fixed and thus no losses should occur.

Discussion
Question 82

If the Federal Reserve Board increased the discount rate, you would expect:

Options:

A.

long-term bonds to increase more in price than short-term bonds.

B.

short-term bonds to decrease more in price than long-term bonds.

C.

long-term bonds to decrease more in price than short-term bonds.

D.

that there would be no effect on either long- or short-term bond prices.

Discussion
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Question 83

A company has negotiated a credit facility with the following terms:

    $5,000,000 line of credit

    $3,000,000 average borrowing

    30 basis point commitment fee on the unused portion of the line

    Interest rate on advances is 1-month LIBOR plus 4%

    1-month LIBOR is currently 2%

What is the annual interest rate on the line of credit?

Options:

A.

6.0%

B.

6.2%

C.

9.0%

D.

9.3%

Discussion
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