CFP Exam
Verified Exam Questions and Answers Latest update 2026/2027
Question:
Which Options are bullish -
Answer:
Buy call and sell put
Question:
How do you determine in the money on a call option? -
Answer:
Stock price-
strike price
Question:
T/F: intrinsic value of an option can be negative. -
Answer:
False
Question:
Do you have an obligation to buy/sell on an option or futures contract? -
Answer:
Futures
Question:
All assets are capital assets except (ACID) -
Answer:
Accounts/notes
receivable
Copyrights and creative works
Inventory
Depreciable property used in trade or business
Question:
Married couples may exclude what amount from cap gains on sale of primary residence?
Singles? -
,Answer:
500k; 250k and must meet two year rule
Question:
What are exclusions to the two year rule for cap gain exclusion on primary residence? -
Answer:
Job change or health change
Question:
What is the gain and loss treatment of a personal asset? -
Answer:
Gain:
short term or long-term capital gains, depending on holding
Loss: may not be recognized or deducted
Question:
What is the gain and loss treatment on a capital asset? -
Answer:
Gain: short
term or long-term gain, depending on holding period
Loss: loss deductible to extent capital gains plus $3000
Question:
What is the gain and lost treatment on a trade or business asset? -
Answer:
Gain: short term or long-term gain, depending on holding.
Loss: ordinary loss deductible against ordinary income
Question:
What is the gain and loss treatment on an ordinary asset? -
Answer:
Gain:
ordinary income
Loss: ordinary loss deductible against ordinary income
Question:
1231 property includes (6) -
, Answer:
Buildings, Machinery, equipment,
land, buz buildings, leasehold improvements.
Question:
1231 property are taxed what when sold? -
Answer:
Capital Gain
Question:
1231 property is taxed as what when sold at a loss -
Answer:
Ordinary loss
Depreciation recapture via
1245: personal property in buz used 1 yr or more
1250: real property in buz
Question:
What happens for taxes when 1245 assets are sold at a gain? -
Answer:
Depreciation taken: ord. Inc.
basis: return of basis
Rest: cap gain
Jason sells a front end loader with a backhoe for $19,500. He had originally purchased it for
$13,000 at an auction and took depreciation of $5000. What is the amount of capital gain?
Question:
(Section 1245 ex) -
Verified Exam Questions and Answers Latest update 2026/2027
Question:
Which Options are bullish -
Answer:
Buy call and sell put
Question:
How do you determine in the money on a call option? -
Answer:
Stock price-
strike price
Question:
T/F: intrinsic value of an option can be negative. -
Answer:
False
Question:
Do you have an obligation to buy/sell on an option or futures contract? -
Answer:
Futures
Question:
All assets are capital assets except (ACID) -
Answer:
Accounts/notes
receivable
Copyrights and creative works
Inventory
Depreciable property used in trade or business
Question:
Married couples may exclude what amount from cap gains on sale of primary residence?
Singles? -
,Answer:
500k; 250k and must meet two year rule
Question:
What are exclusions to the two year rule for cap gain exclusion on primary residence? -
Answer:
Job change or health change
Question:
What is the gain and loss treatment of a personal asset? -
Answer:
Gain:
short term or long-term capital gains, depending on holding
Loss: may not be recognized or deducted
Question:
What is the gain and loss treatment on a capital asset? -
Answer:
Gain: short
term or long-term gain, depending on holding period
Loss: loss deductible to extent capital gains plus $3000
Question:
What is the gain and lost treatment on a trade or business asset? -
Answer:
Gain: short term or long-term gain, depending on holding.
Loss: ordinary loss deductible against ordinary income
Question:
What is the gain and loss treatment on an ordinary asset? -
Answer:
Gain:
ordinary income
Loss: ordinary loss deductible against ordinary income
Question:
1231 property includes (6) -
, Answer:
Buildings, Machinery, equipment,
land, buz buildings, leasehold improvements.
Question:
1231 property are taxed what when sold? -
Answer:
Capital Gain
Question:
1231 property is taxed as what when sold at a loss -
Answer:
Ordinary loss
Depreciation recapture via
1245: personal property in buz used 1 yr or more
1250: real property in buz
Question:
What happens for taxes when 1245 assets are sold at a gain? -
Answer:
Depreciation taken: ord. Inc.
basis: return of basis
Rest: cap gain
Jason sells a front end loader with a backhoe for $19,500. He had originally purchased it for
$13,000 at an auction and took depreciation of $5000. What is the amount of capital gain?
Question:
(Section 1245 ex) -
