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AFP CTP Exam Questions
Certified Treasury Professional (Page 22 )

Updated On: 17-Feb-2026
Page 22 of 188
PDF with 1076 Questions

The treasurer of a corporation is negotiating with one of his/her suppliers to allow the corporation to have 30 days to pay the supplier’s invoices. The treasurer is arranging:

  1. short-term financing.
  2. revolving credit agreement.
  3. factoring of receivables.
  4. uncommitted line of credit.

Answer(s): A



A company is looking for a way to finance their inventory. What is the BEST funding match?

  1. Long-term private placement
  2. Short-term debt
  3. Equity issuance
  4. Stock split

Answer(s): B



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?

  1. 6.0%
  2. 6.2%
  3. 9.0%
  4. 9.3%

Answer(s): B



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 unused portion of line
• Interest rate on advances is 1-month LIBOR plus 4%
• 1-month LIBOR is currently 2%
• Compensating balance requirement of 20% on the outstanding borrowings

What is the effective annual borrowing rate for the line of credit?

  1. 6.0%
  2. 6.2%
  3. 7.8%
  4. 9.3%

Answer(s): C



Which of the following statements is typically true about a net settlement system?

  1. It significantly reduces the total cost of transfers.
  2. Participants obtain improved payment terms from suppliers.
  3. Receivables and payments are continuously settled 1-to-1.
  4. An independent third party determines the settlement dates.

Answer(s): A






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