QFC Study Guide 2026
Everything you need to pass the QFC exam in one place: the exam format, every topic to study, real practice questions with explanations, flashcards, and full-length practice tests. Free, no sign-up needed.
📋 QFC Exam Format at a Glance
📚 QFC Topics to Study (69)
✍️ Sample QFC Questions & Answers
1. In a process costing system using the weighted-average method, equivalent units for conversion costs are calculated by:
Weighted-average equivalent units = fully completed units + (ending WIP units × percentage of completion for conversion).
2. Under IRC §704(b), a partnership's special allocation of income or loss to a specific partner must satisfy which fundamental requirement?
Partnership allocations are respected for tax purposes only if they have substantial economic effect, meaning they must reflect the economic arrangement among partners.
3. The economic order quantity (EOQ) model minimizes which combination of costs?
EOQ minimizes total inventory cost by balancing ordering costs (decrease with larger orders) and carrying costs (increase with larger orders).
4. What distinguishes 'agency MBS' from 'non-agency MBS'?
Agency MBS are issued or guaranteed by GSEs (Fannie Mae, Freddie Mac) or Ginnie Mae, providing protection against credit losses, while non-agency MBS rely solely on the underlying loans' creditworthiness.
5. In a Merton structural credit model, a firm defaults when its asset value falls below its debt face value at maturity. Equity in this model is treated as:
Equity holders receive max(V − D, 0) at maturity, identical to a call option payoff on total asset value V with strike D.
6. What is the primary role of the bond indenture in a fixed income security?
The indenture is the legal contract detailing coupon payments, maturity, covenants (restrictions on the issuer), and bondholder remedies in default.