SUBJECTS
|
BROWSE
|
CAREER CENTER
|
POPULAR
|
JOIN
|
LOGIN
Business Skills
|
Soft Skills
|
Basic Literacy
|
Certifications
About
|
Help
|
Privacy
|
Terms
|
Email
Search
Test your basic knowledge |
CFP: Certified Financial Planner
Start Test
Study First
Subjects
:
certifications
,
cfp
,
business-skills
Instructions:
Answer 46 questions in 15 minutes.
If you are not ready to take this test, you can
study here
.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.
This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. After-tax Return
Total Return (1 - tax bracket)
EBIT/I (Where I = Interest Expense)
Gross investment Income less any deductible other investment-related expenses (must exceed 2% of AGI)
Earnings Before Interest & Taxes
2. Social Styles
Price Earnings Growth ratio; P/E divided by projected earnings growth
EGAD CIMP - Establish and define Relationship - Gather Information - Analyze and Evaluate Current Stauts - Develop Recommendations - Communicate Recommendations - Monitor Recommendations - Practice Professional Standards
Explanatory - Interpretive - Reassuring - Suggestive
driving - expressive - amiable - analytical
3. Real Return (inflation adjusted); NR = Nominal Return; CCL = Change in Cost of Living (inflation rate)
(Coupon1 /2)/(1+YTM)/2?1 + (Coupon2 /2)/(1+YTM)/2?2 +...+ (CouponT /2)/(1+YTM)/2?n
current assets - current liabilities
Sales / Average Total Assets
[(1+ NR) / (1 + CCL)] - 1
4. Sustainable Growth Rate
driving - expressive - amiable - analytical
Total Assets / Equity
g = ROE X b - where b is equal to the retention ratio
EBIT/I (Where I = Interest Expense)
5. The payout ratio
dividends / earnings
EBIT/I (Where I = Interest Expense)
[(1+ NR) / (1 + CCL)] - 1
Tax Deduction * marginal tax rate
6. Total Debt to Equity ratio
Unconditional positive regard - Accurate empathy - Genuineness - Self-awareness
Total Liabilities / Equity
Price Earnings Growth ratio; P/E divided by projected earnings growth
Net Worth/Total Assets
7. Equivalent Tax Credit
1 - the payout ratio
Price Earnings Growth ratio; P/E divided by projected earnings growth
Tax Deduction * marginal tax rate
Earnings Before Interest & Taxes
8. Holding Period Return
Unconditional positive regard - Accurate empathy - Genuineness - Self-awareness
(Mortgage+Debt Repayment)/Net Income
(P1 + D - P0)/P0
Price Earnings Growth ratio; P/E divided by projected earnings growth
9. Quick Ratio (aka Acid test)
Top: Retirement and Estate - Mid: Growing Investments - Bottom: Guarding Against Uncertainty (Insurance)
(P1 + D - P0)/P0
(current assets - inventory) / current liabilities
IOC FC PD - Integrity - Objectivity - Compentence - Fairness - Confidentiality - Professionalism - Diligence
10. Liquidity Ratio
Tax Free Yield/(1 - Tax Bracket)
(Liquid Assets/Total Current Debts=Liquid Assets/(Current Liabilities+Annual Loan Payments)
Price Earnings Growth ratio; P/E divided by projected earnings growth
(Coupon1 /2)/(1+YTM)/2?1 + (Coupon2 /2)/(1+YTM)/2?2 +...+ (CouponT /2)/(1+YTM)/2?n
11. After-tax Yield
Total Long-term Debt / Equity
1 - the payout ratio
current assets - current liabilities
Tax Free Yield/(1 - Tax Bracket)
12. Solvency Ratio
Tax Free Yield/(1 - Tax Bracket)
Net Worth/Total Assets
(Liquid Assets/Total Current Debts=Liquid Assets/(Current Liabilities+Annual Loan Payments)
current assets / current liabilities
13. Asset Turnover Ratio
Sales / Average Total Assets
(Coupon1 /2)/(1+YTM)/2?1 + (Coupon2 /2)/(1+YTM)/2?2 +...+ (CouponT /2)/(1+YTM)/2?n
Continuing - Restatement of content - Reflection of feeling - Clarifying - Summarization
Explanatory - Interpretive - Reassuring - Suggestive
14. Types of Understanding Responses Associated With Active Listening
current assets - current liabilities
Continuing - Restatement of content - Reflection of feeling - Clarifying - Summarization
P*(1+g)/(k-g) P=div per share divided by other div
Net Cash Flow+Already Being Saved or Invested/Annual After Tax Income
15. Cash Ratio
(cash + marketable securities) / current liabilities
EAT / Sales
(Liquid Assets/Total Current Debts=Liquid Assets/(Current Liabilities+Annual Loan Payments)
EGAD CIMP - Establish and define Relationship - Gather Information - Analyze and Evaluate Current Stauts - Develop Recommendations - Communicate Recommendations - Monitor Recommendations - Practice Professional Standards
16. Equivalent Tax Deduction
current assets / current liabilities
EBIT/I (Where I = Interest Expense)
(cash + marketable securities) / current liabilities
Tax Credit/marginal tax rate
17. financial life cycle
Earnings Before Interest & Taxes
IOC FC PD - Integrity - Objectivity - Compentence - Fairness - Confidentiality - Professionalism - Diligence
(Coupon1 /2)/(1+YTM)/2?1 + (Coupon2 /2)/(1+YTM)/2?2 +...+ (CouponT /2)/(1+YTM)/2?n
early career (age 25 or younger to age 35) - career development (age 35 to age 50) - peak accumulation (age 50 to ages 58-62) - preretirement (3 to 6 years prior to planned retirement) - retirement (ages 62-66 and older)
18. Savings Ratio
[(1+ NR) / (1 + CCL)] - 1
(P1 + D - P0)/P0
Unconditional positive regard - Accurate empathy - Genuineness - Self-awareness
Net Cash Flow+Already Being Saved or Invested/Annual After Tax Income
19. Opportunities in Financial Planning
EGAD CIMP - Establish and define Relationship - Gather Information - Analyze and Evaluate Current Stauts - Develop Recommendations - Communicate Recommendations - Monitor Recommendations - Practice Professional Standards
assets less liabilities - divided by the number of shares of common stock of a company
RIVETC - Rising median age - Increased impact of dual-income families - Volatility of financial conditions - Evolving tax environment - Technological change - Concern over fraud and firm failure
Tax Deduction * marginal tax rate
20. Types of Leading Responses
Net Income/Equity
(Coupon1 /2)/(1+YTM)/2?1 + (Coupon2 /2)/(1+YTM)/2?2 +...+ (CouponT /2)/(1+YTM)/2?n
(1/T)(r1+r2+...+rT)
Explanatory - Interpretive - Reassuring - Suggestive
21. Gross Investment income
current assets / current liabilities
taxable interest - non-qual. divs - short-term cap. gains
EAT / Sales
Total Return (1 - tax bracket)
22. Net After Tax Profit Margin
Total Long-term Debt / Equity
Total Return (1 - tax bracket)
EAT / Sales
1 - the payout ratio
23. Net Investment Income
Total Liabilities / Equity
Gross investment Income less any deductible other investment-related expenses (must exceed 2% of AGI)
early career (age 25 or younger to age 35) - career development (age 35 to age 50) - peak accumulation (age 50 to ages 58-62) - preretirement (3 to 6 years prior to planned retirement) - retirement (ages 62-66 and older)
Tax Deduction * marginal tax rate
24. Net Cash Flow
Price/Earnings per share
Gross investment Income less any deductible other investment-related expenses (must exceed 2% of AGI)
Sources of Funds-Use of Funds or Money in- Money out
Earnings Before Interest & Taxes
25. CFP Ethical principles
current assets - current liabilities
g = ROE X b - where b is equal to the retention ratio
IOC FC PD - Integrity - Objectivity - Compentence - Fairness - Confidentiality - Professionalism - Diligence
Net Income/Equity
26. Debt to Equity ratio
(Mortgage+Debt Repayment)/Net Income
Total Long-term Debt / Equity
taxable interest - non-qual. divs - short-term cap. gains
Tax Free Yield/(1 - Tax Bracket)
27. EBIT
Earnings Before Interest & Taxes
Tax Credit/marginal tax rate
Total Liabilities / Equity
EGAD CIMP - Establish and define Relationship - Gather Information - Analyze and Evaluate Current Stauts - Develop Recommendations - Communicate Recommendations - Monitor Recommendations - Practice Professional Standards
28. Arithmetic Mean Return; T = Terminal period; good for comparing different investments
Net Worth/Total Assets
Sources of Funds-Use of Funds or Money in- Money out
(1/T)(r1+r2+...+rT)
G RETIRE - General Principles - Retirement Planning - Estate Planning - Tax Planning - Investment Planning - Risk Management (Insurance) - Employee Benefits
29. Attributes of Effective Advisor communiations
Unconditional positive regard - Accurate empathy - Genuineness - Self-awareness
Earnings After Taxes
P*(1+g)/(k-g) P=div per share divided by other div
Tax Credit/marginal tax rate
30. aka Net Income
IOC FC PD - Integrity - Objectivity - Compentence - Fairness - Confidentiality - Professionalism - Diligence
current assets / current liabilities
Earnings After Taxes
(Mortgage+Debt Repayment)/Net Income
31. Current Yield of a bond
Warning
: Invalid argument supplied for foreach() in
/var/www/html/basicversity.com/show_quiz.php
on line
183
32. PEG ratio
Price Earnings Growth ratio; P/E divided by projected earnings growth
EBIT/I (Where I = Interest Expense)
early career (age 25 or younger to age 35) - career development (age 35 to age 50) - peak accumulation (age 50 to ages 58-62) - preretirement (3 to 6 years prior to planned retirement) - retirement (ages 62-66 and older)
current assets / current liabilities
33. Assets to Equity ratio
driving - expressive - amiable - analytical
Sales / Average Total Assets
Total Assets / Equity
Gross investment Income less any deductible other investment-related expenses (must exceed 2% of AGI)
34. Major CFP Planning Areas
(1/T)(r1+r2+...+rT)
Explanatory - Interpretive - Reassuring - Suggestive
Earnings After Taxes
G RETIRE - General Principles - Retirement Planning - Estate Planning - Tax Planning - Investment Planning - Risk Management (Insurance) - Employee Benefits
35. Current Ratio
current assets / current liabilities
EBIT/I (Where I = Interest Expense)
early career (age 25 or younger to age 35) - career development (age 35 to age 50) - peak accumulation (age 50 to ages 58-62) - preretirement (3 to 6 years prior to planned retirement) - retirement (ages 62-66 and older)
driving - expressive - amiable - analytical
36. financial planning pyramid
1 - the payout ratio
Top: Retirement and Estate - Mid: Growing Investments - Bottom: Guarding Against Uncertainty (Insurance)
assets less liabilities - divided by the number of shares of common stock of a company
Dollars of coupon interest per year/Bond's current market price
37. 'normal' ratio
Earnings Before Interest & Taxes
Total Liabilities / Equity
Continuing - Restatement of content - Reflection of feeling - Clarifying - Summarization
P*(1+g)/(k-g) P=div per share divided by other div
38. Present value of a Bond
current assets / current liabilities
(Coupon1 /2)/(1+YTM)/2?1 + (Coupon2 /2)/(1+YTM)/2?2 +...+ (CouponT /2)/(1+YTM)/2?n
Total Liabilities / Equity
dividends / earnings
39. Domains of a CFP
Unconditional positive regard - Accurate empathy - Genuineness - Self-awareness
EGAD CIMP - Establish and define Relationship - Gather Information - Analyze and Evaluate Current Stauts - Develop Recommendations - Communicate Recommendations - Monitor Recommendations - Practice Professional Standards
Earnings Before Interest & Taxes
current assets - current liabilities
40. Book Value (of company stock)
taxable interest - non-qual. divs - short-term cap. gains
assets less liabilities - divided by the number of shares of common stock of a company
Total Return (1 - tax bracket)
Sales / Average Total Assets
41. The retention ratio
(Coupon1 /2)/(1+YTM)/2?1 + (Coupon2 /2)/(1+YTM)/2?2 +...+ (CouponT /2)/(1+YTM)/2?n
Sources of Funds-Use of Funds or Money in- Money out
driving - expressive - amiable - analytical
1 - the payout ratio
42. ROE (Return On Equity)
early career (age 25 or younger to age 35) - career development (age 35 to age 50) - peak accumulation (age 50 to ages 58-62) - preretirement (3 to 6 years prior to planned retirement) - retirement (ages 62-66 and older)
(Liquid Assets/Total Current Debts=Liquid Assets/(Current Liabilities+Annual Loan Payments)
EAT / Sales
Net Income/Equity
43. P/E ratio
Sales / Average Total Assets
(cash + marketable securities) / current liabilities
Price/Earnings per share
Continuing - Restatement of content - Reflection of feeling - Clarifying - Summarization
44. Debt Service Ratio
(Mortgage+Debt Repayment)/Net Income
current assets - current liabilities
driving - expressive - amiable - analytical
(current assets - inventory) / current liabilities
45. Times Interest Earned
RIVETC - Rising median age - Increased impact of dual-income families - Volatility of financial conditions - Evolving tax environment - Technological change - Concern over fraud and firm failure
Explanatory - Interpretive - Reassuring - Suggestive
taxable interest - non-qual. divs - short-term cap. gains
EBIT/I (Where I = Interest Expense)
46. Working Capital
Gross investment Income less any deductible other investment-related expenses (must exceed 2% of AGI)
current assets - current liabilities
current assets / current liabilities
taxable interest - non-qual. divs - short-term cap. gains