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M100 COMMUNITY ASSOCIATION MANAGEMENT EXAM AND
PRACTICE EXAM NEWEST 2025/2026 ACTUAL EXAM WITH
COMPLETE QUESTIONS AND CORRECT DETAILED ANSWERS (100%
VERIFIED ANSWERS) |ALREADY GRADED A+| ||PROFESSOR
VERIFIED||
Which of the following is a year-end financial statement that
reconciles the beginning and ending members' equity with results
of operations for the period?
a. balance sheet
b. statement of changes in members' equity
c. statement of cash flows
d. notes to financial statements - ANSWER-b. statement of
changes in members' equity
A statement of changes in members' equity (or fund balances) is
a year-end financial statement that reconciles the beginning and
ending members' equity with results of operations for the period.
Although this is a required statement by Generally Accepted
Accounting Principles (GAAP), the new manager will not spend
much time reviewing this particular report.
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Complete the following sentence: A(n) _______________ is a
presentation of financial statements by a CPA without the
assurance that the information conforms to GAAP.
a. compilation
b. review
c. audit
d. opinion letter - ANSWER-a. compilation
With a compilation, the CPA prepares the community
association's financial statements based on information the
association provides. The CPA cannot make any claims about the
accuracy and completeness of the financial statements, as
opposed to the audit and review, which provide some assurance
to the board and other interested parties that the financial
statements make sense.
True or false. Community associations must file a federal income
tax return every year - ANSWER-True
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All community associations must file a federal income tax return
every year. The filing of a tax return does not necessarily mean
that a community association owes any tax. Further, the lack of
taxable income does not eliminate the need to file.
True or false. Requiring a single signature to withdraw funds from
an investment account is a good example of a system of internal
checks and balances to protect association investments. -
ANSWER-False
Every community association needs a system of internal checks
and balances to protect its investments. An good example is
requiring at least two signatures to withdraw funds from
investment accounts.
Which of the following investment objectives for community
associations refers to the ease with which an investment can be
converted into cash or a cash equivalent?
a. safety
b. liquidity
c. yield
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d. treasury bills - ANSWER-b. liquidity
Liquidity refers to the ease with which an investment can be
converted into cash or a cash equivalent. Due to unexpected
events, a community association may need access to its invested
funds at times other than planned.
Which of the following types of exposure to loss for a community
association is characterized by net losses that may involve a
reduction in income or an increase in operating expenses or
both?
a. property exposure to loss
b. liability exposure to loss
c. income exposure to loss
d. personnel exposure to loss - ANSWER-c. income exposure to
loss
There are four types of accidental loss to which a community
association is exposed. Income exposure to loss are net losses
M100 COMMUNITY ASSOCIATION MANAGEMENT EXAM AND
PRACTICE EXAM NEWEST 2025/2026 ACTUAL EXAM WITH
COMPLETE QUESTIONS AND CORRECT DETAILED ANSWERS (100%
VERIFIED ANSWERS) |ALREADY GRADED A+| ||PROFESSOR
VERIFIED||
Which of the following is a year-end financial statement that
reconciles the beginning and ending members' equity with results
of operations for the period?
a. balance sheet
b. statement of changes in members' equity
c. statement of cash flows
d. notes to financial statements - ANSWER-b. statement of
changes in members' equity
A statement of changes in members' equity (or fund balances) is
a year-end financial statement that reconciles the beginning and
ending members' equity with results of operations for the period.
Although this is a required statement by Generally Accepted
Accounting Principles (GAAP), the new manager will not spend
much time reviewing this particular report.
,2|Page
Complete the following sentence: A(n) _______________ is a
presentation of financial statements by a CPA without the
assurance that the information conforms to GAAP.
a. compilation
b. review
c. audit
d. opinion letter - ANSWER-a. compilation
With a compilation, the CPA prepares the community
association's financial statements based on information the
association provides. The CPA cannot make any claims about the
accuracy and completeness of the financial statements, as
opposed to the audit and review, which provide some assurance
to the board and other interested parties that the financial
statements make sense.
True or false. Community associations must file a federal income
tax return every year - ANSWER-True
,3|Page
All community associations must file a federal income tax return
every year. The filing of a tax return does not necessarily mean
that a community association owes any tax. Further, the lack of
taxable income does not eliminate the need to file.
True or false. Requiring a single signature to withdraw funds from
an investment account is a good example of a system of internal
checks and balances to protect association investments. -
ANSWER-False
Every community association needs a system of internal checks
and balances to protect its investments. An good example is
requiring at least two signatures to withdraw funds from
investment accounts.
Which of the following investment objectives for community
associations refers to the ease with which an investment can be
converted into cash or a cash equivalent?
a. safety
b. liquidity
c. yield
, 4|Page
d. treasury bills - ANSWER-b. liquidity
Liquidity refers to the ease with which an investment can be
converted into cash or a cash equivalent. Due to unexpected
events, a community association may need access to its invested
funds at times other than planned.
Which of the following types of exposure to loss for a community
association is characterized by net losses that may involve a
reduction in income or an increase in operating expenses or
both?
a. property exposure to loss
b. liability exposure to loss
c. income exposure to loss
d. personnel exposure to loss - ANSWER-c. income exposure to
loss
There are four types of accidental loss to which a community
association is exposed. Income exposure to loss are net losses
