SOFE SOFA-CFE Exam Practice Test Instant Access

Question 1

The receivable turnover can be calculated by which of the following formula:

AReceivable turnover = Net Sales on Account / Average Net Receivables

BReceivable turnover = Gross Sales on Account / Average Gross Receivables

CReceivable turnover = Net Sales on Receivables / Average Net Account

DReceivable turnover = Gross Sales on Receivables / Average Gross Account

Answer : A

Question 2

According to Accounting Changes and Errors Corrections, which of the following is NOT the type accounting change that must be disclosed to avoid misleading the user of financial statements?

Aaccounting principles

Bestimates

Creporting entities

Dliability omissions

Answer : D

Question 3

_________________ are potential obligations that will materialize only if certain events occur in future.

AWarranties returns

BLiability omissions

CContingent liabilities

DConcealed expenses

Answer : C

Question 4

Worker's compensation is not a payroll account, but rather an insurance expense.

Atrue

BFalse

Answer : A

Question 5

The most common method of misappropriating funds from the payroll is the:

Acrediting wages

Bghost employee payment

Coverpayment of wages

Dfraudulent disbursements

Answer : C

Question 6

What is computed by summing the loss reserve liabilities and the unearned premium reserve and then dividing that sum by policyholder surplus?

AGross miscellaneous ratio

Bnet leverage ratio

CTotal influential investment

Dnet mortgage ratio

Answer : B

Question 7

A combined ratio under 100 percent reflects an underwriting profit, with a combined ratio above 100 percent reflecting an underwriting loss.

ATrue

BFalse

Answer : A

SOFE SOFA-CFE Certified Financial Examiner Exam Practice Test