FPAC Exam Prep Free practice test →

Free FPAC Practice Questions

10 free, exam-style Certified Corporate FP&A Professional (FPAC) practice questions with answers and explanations. No signup required. Work through them below, then take the full free FPAC practice test to study every exam domain.

Question 1

A product sells for $50 per unit with variable costs of $30 per unit, and the company has annual fixed costs of $300,000. How many units must be sold to earn a target operating profit of $100,000?

  1. 5,000 units
  2. 8,000 units
  3. 15,000 units
  4. 20,000 units
Show answer & explanation

Correct answer: D - 20,000 units

Question 2

A proposed capital project has an internal rate of return (IRR) of 9%. The company's weighted average cost of capital (WACC) is 11%. Based solely on this information, the project should be:

  1. Rejected, because the return is below the cost of capital
  2. Accepted, because a 9% internal rate of return represents a positive return to the firm
  3. Accepted, because the IRR exceeds the typical risk-free rate
  4. Deferred, because IRR alone cannot determine acceptance without the payback period
Show answer & explanation

Correct answer: A - Rejected, because the return is below the cost of capital

Question 3

A consulting firm completes and delivers an engagement in December, sends the invoice in January, and receives payment in February. Under accrual-basis accounting, the revenue is recognized in:

  1. December, when the service is performed
  2. January, when the invoice is issued to the client
  3. February, when the cash payment is actually received
  4. Proportionally across December, January, and February as the cash cycle completes
Show answer & explanation

Correct answer: A - December, when the service is performed

Question 4

During the rollout of a new planning system, finance users run their own real budgeting scenarios through the system to confirm it produces the expected results before go-live. This step is BEST described as:

  1. A proof of concept
  2. Parallel running of the old and new systems
  3. User acceptance testing (UAT)
  4. A system integration test conducted by the IT department
Show answer & explanation

Correct answer: C - User acceptance testing (UAT)

Question 5

A sales director asks an FP&A analyst to add three new scenarios to a model - roughly a full day of work - when the analyst is already committed to delivering that same model to the CFO within two hours. What is the MOST appropriate first action?

  1. Decline the request, since adding new scenarios clearly falls outside the originally agreed scope of work
  2. Deliver the CFO model on time, then agree a realistic timeline for the new scenarios
  3. Postpone the CFO deliverable so the sales director's scenarios can be added first
  4. Escalate the competing requests to the CFO before doing any further work
Show answer & explanation

Correct answer: B - Deliver the CFO model on time, then agree a realistic timeline for the new scenarios

Question 6

An FP&A analyst wants a leading indicator to help predict next quarter's revenue. Which of the following is a LEADING indicator?

  1. Revenue recognized in the current quarter
  2. Year-to-date net income
  3. The number of qualified opportunities in the sales pipeline
  4. Cash collected from prior-period accounts receivable balances
Show answer & explanation

Correct answer: C - The number of qualified opportunities in the sales pipeline

Question 7

A department's full-year expense budget is $600,000. Actual spending through Q1 (three months) is $165,000. If spending continues at this run rate, the projected full-year variance to budget will be:

  1. $15,000 unfavorable
  2. $60,000 favorable
  3. $60,000 unfavorable
  4. $435,000 favorable
Show answer & explanation

Correct answer: C - $60,000 unfavorable

Question 8

An analyst estimates the demand model: Units Sold = 50,000 + 0.30 × (Marketing Spend) − 800 × (Price). With a marketing spend of $100,000 and a price of $25, the predicted units sold are:

  1. 30,000 units
  2. 60,000 units
  3. 80,000 units
  4. 100,000 units
Show answer & explanation

Correct answer: B - 60,000 units

Question 9

An analyst finds a correlation coefficient of −0.85 between a product's price and its unit sales volume. The BEST interpretation is:

  1. A strong inverse relationship between price and volume
  2. A weak relationship unlikely to be meaningful for planning
  3. A strong positive relationship between price and volume
  4. That changes in price explain 85% of the variation in unit sales volume
Show answer & explanation

Correct answer: A - A strong inverse relationship between price and volume

Question 10

An FP&A manager must show executives how operating income changed from last year to this year, broken into the separate effects of volume, price, and cost. Which chart communicates this bridge MOST effectively?

  1. A pie chart of this year's cost categories
  2. A scatter plot of price against volume
  3. A stacked area chart showing both years side by side
  4. A waterfall chart bridging last year to this year
Show answer & explanation

Correct answer: D - A waterfall chart bridging last year to this year

Ready for the real thing?

Practice hundreds more FPAC questions with instant scoring, weak-area drills, and full exam simulations.

Start the free practice test See pricing