CDFM Accounting and Finance 3

Question 1

In the DoD Working Capital Fund (WCF) environment, what is the term for the price charged to customers that includes all costs plus any planned surcharge?

Accepted Answer

Stabilized rate

Answer

Stabilized rates are set in advance to recover all costs over a fixed period, providing customers predictable pricing.

Question 2

Which depreciation method is required by SFFAS No. 6 for most general property, plant, and equipment (PP&E) in the federal government?

Accepted Answer

Straight-line

Answer

SFFAS No. 6 requires the straight-line depreciation method for most federal PP&E unless a different method better matches usage.

Question 3

A Defense agency transfers $500,000 of excess equipment to another federal entity at no cost. How should the transferring agency record this transaction?

Accepted Answer

Debit net position; credit equipment at net book value

Answer

Non-exchange transfers out are recorded as a reduction in net position equal to the net book value of the transferred asset.

Question 4

Under SFFAS No. 7, which federal entity recognizes revenue when it delivers a good or service and invoices another federal entity?

Accepted Answer

The entity providing the good or service

Answer

The selling/providing entity recognizes exchange revenue upon delivery and billing for reimbursable services between federal entities.

Question 5

What DoD term describes the process of reducing an obligation when a vendor invoice is less than the original purchase order amount?

Accepted Answer

Deobligation

Answer

Deobligation reduces or cancels a previously recorded obligation when actual costs are less than the amount originally obligated.

CDFM - Certified Defense Financial Manager Practice Test

CDFM - Certified Defense Financial Manager Practice Test

CDFM Accounting and Finance 3