Practice Test Geeks(SBA) Small Business Administration Certified Business Practice Test
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Financial Management & Funding Resources Flashcards

7 cards from real SBA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Financial Management & Funding Resources flashcards as text

  1. Under the SBA 504 loan program, what is the typical structure of the financing arrangement?

    Answer: Bank provides 50%, CDC/SBA provides 40%, borrower contributes 10%

    The typical 504 structure is: a private lender covers 50%, a CDC (backed by an SBA debenture) covers 40%, and the small business contributes 10% as a down payment.

  2. Which type of financial analysis compares each line item on a financial statement as a percentage of a base figure (e.g., total revenue)?

    Answer: Vertical analysis

    Vertical analysis expresses each financial statement item as a percentage of a base figure, such as expressing all income statement items as a percentage of total revenue.

  3. What is the SBA's primary role in the 7(a) loan program?

    Answer: The SBA guarantees a portion of loans made by approved lenders

    In the 7(a) program, the SBA does not lend directly but instead guarantees a portion (up to 85%) of loans made by SBA-approved private lenders, reducing lender risk.

  4. Which of the following is NOT a typical use of proceeds for an SBA 7(a) loan?

    Answer: Paying personal income taxes of the business owner

    SBA 7(a) loans cannot be used to pay personal expenses, including the owner's income taxes; funds must be used for legitimate business purposes.

  5. In the context of SBA lending, what does 'collateral' primarily serve to protect?

    Answer: The lender in case the borrower defaults on the loan

    Collateral provides the lender with a secondary source of repayment if the borrower defaults, reducing the lender's financial risk on the loan.

  6. Which SBA resource provides free, confidential business mentoring and advice through a network of volunteer expert business mentors?

    Answer: SCORE

    SCORE is a nonprofit association supported by the SBA that provides free business mentoring and education through a nationwide network of volunteer business mentors.

  7. What financial metric is calculated by dividing net income by total revenue and expressed as a percentage?

    Answer: Net profit margin

    Net profit margin = (Net Income ÷ Total Revenue) × 100, showing what percentage of revenue translates into profit after all expenses.

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Sources & references

Exam facts on this page (fees, format, dates, passing scores) are checked against these official sources; the date is our last check. Editorial policy

  1. sba.gov — Test delivery, eligibility, renewal, score release, score validity · verified Oct 2026