AFIP Basic Certification Exam NEWEST 2025 COMPLETE
QUESTIONS AND CORRECT DETAILED ANSWERS
(VERIFIED ANSWERS) |ALREADY GRADED A+||BRAND
NEW VERSION!!
What is "consideration" as it applies to a contract? - CORRECT ANSWER- The requirement that each
party to the contract receives something of value in exchange for what is given.
Finance Charge - CORRECT ANSWER- The Finance Charge is the resulting dollar amount calculated by
applying the Annual Percentage Rate to the Amount Financed over the term of the contract.
(True/False): Ignorance of the law will shield you from liability if you are noncompliant. - CORRECT
ANSWER- False
(True/False): As an F&I manager working directly with customers, you are individually responsible for
your actions and what you say to each customer. - CORRECT ANSWER- True
In a typical credit transaction the (bank)/(dealer) is the creditor. - CORRECT ANSWER- The dealer is
the creditor
How the Itemization of Amount Financed is completed - CORRECT ANSWER- 1. Cash Price (Agreed to
price of vehicle)
2. Total Downpayment
3. Unpaid Balance of Cash Price(Cash Price-Downpayment)
,4. Other Charges (GAP, VSC, Etc.)
5. Amount Financed
4 Key Sections of an installment sale contract - CORRECT ANSWER- Section A) General Information --
Identifies the parties to the agreement.
Section B) Mandated Disclosures -- Disclosures required by TILA
Section C) Insurance-Related Disclosures --Credit insurance is optional
Section D) Signature Blocks - Notice to Buyer Disclosures --Bind all parties to contract
The introductory information and promise to pay contained in Section A of Retail Installment Form -
CORRECT ANSWER- Promise to Pay - This section outlines the purpose of the transaction and the
primary obligations that will be incurred from signing the contract.
The difference between full or partial recourse and no recourse assignments. - CORRECT ANSWER-
Essentially determines the length of time, if any, the seller is responsible for the actions of the buyer.
Warranty disclaimers do not apply to _______ warranties on new or used vehicles to which that
warranty still applies. - CORRECT ANSWER- Manufacturer's
A(n) _______ clause allows the creditor to declare the entire outstanding balance due and payable. -
CORRECT ANSWER- Acceleration
As recorded on an installment sale agreement, the total sale price or deferred contract price would be
the total of the ________. - CORRECT ANSWER- -Payments
-Downpayment
,-Net Trade-In
Which is NOT listed as a mandated TILA box disclosure? - CORRECT ANSWER- Holder-in-Due Course
Notice
In most states, the _______ is deemed to be part of the purchase agreement. - CORRECT ANSWER-
Buyer's Guide
(True/False) Because the late charges that may be imposed on an installment sale agreement are
regulated at the state level, the amount of the late charge is NOT a required disclosure item. -
CORRECT ANSWER- False
At the time of consummation, an installment sale contract is between the _______ and the _______. -
CORRECT ANSWER- Customer, Dealer
The Truth in Lending Act and Reg. Z govern installment sale transactions for vehicles purchased for what
type(s) of uses? - CORRECT ANSWER- Personal, Family or Household
What is always the largest number on an installment sale agreement? - CORRECT ANSWER- The total
sale price
What is a contract? - CORRECT ANSWER- A contract is an agreement involving a promise or set of
promises that the law enforces or protects.
The formation of a contract requires three elements: - CORRECT ANSWER- 1. Offer
2. Acceptance
3. Consideration
, An offer consists of three elements: - CORRECT ANSWER- 1. An expression of a promise or
commitment (intent) to enter a contract
2. An expression of definite and certain terms
3. The communication of the offer to the offeree (in this case, the customer)
An offer may be terminated by: - CORRECT ANSWER- 1. An act of the parties
2. The operation of law
There are three criteria for the acceptance of an offer: - CORRECT ANSWER- 1. The offer is accepted
by one who is entitled to accept
2. The acceptance takes the proper form and is timely
3. The terms of acceptance reflect closely the terms of the offer and, therefore, do not amount to a
counteroffer
The Statute of Frauds - CORRECT ANSWER- Generally requires that all contracts involving the sale of
goods for a price of $500 or more be in writing.
The Statute of Frauds requires a written contract for the sale of goods for a price of _______ or more. -
CORRECT ANSWER- $500
What is required in order for the parties (the individuals entering into the contract) to have "legal
capacity?" - CORRECT ANSWER- The parties to the contract must be of legal age under the laws of the
state in which the contract is written.
Criteria that can block the formation of a valid contract: - CORRECT ANSWER- 1. The need for a
written agreement under the Statute of Frauds and certain provisions of the Uniform Commercial Code
(U.C.C.)
2. The need for legal capacity of a party to contract
3. The act of fraudulent inducement
QUESTIONS AND CORRECT DETAILED ANSWERS
(VERIFIED ANSWERS) |ALREADY GRADED A+||BRAND
NEW VERSION!!
What is "consideration" as it applies to a contract? - CORRECT ANSWER- The requirement that each
party to the contract receives something of value in exchange for what is given.
Finance Charge - CORRECT ANSWER- The Finance Charge is the resulting dollar amount calculated by
applying the Annual Percentage Rate to the Amount Financed over the term of the contract.
(True/False): Ignorance of the law will shield you from liability if you are noncompliant. - CORRECT
ANSWER- False
(True/False): As an F&I manager working directly with customers, you are individually responsible for
your actions and what you say to each customer. - CORRECT ANSWER- True
In a typical credit transaction the (bank)/(dealer) is the creditor. - CORRECT ANSWER- The dealer is
the creditor
How the Itemization of Amount Financed is completed - CORRECT ANSWER- 1. Cash Price (Agreed to
price of vehicle)
2. Total Downpayment
3. Unpaid Balance of Cash Price(Cash Price-Downpayment)
,4. Other Charges (GAP, VSC, Etc.)
5. Amount Financed
4 Key Sections of an installment sale contract - CORRECT ANSWER- Section A) General Information --
Identifies the parties to the agreement.
Section B) Mandated Disclosures -- Disclosures required by TILA
Section C) Insurance-Related Disclosures --Credit insurance is optional
Section D) Signature Blocks - Notice to Buyer Disclosures --Bind all parties to contract
The introductory information and promise to pay contained in Section A of Retail Installment Form -
CORRECT ANSWER- Promise to Pay - This section outlines the purpose of the transaction and the
primary obligations that will be incurred from signing the contract.
The difference between full or partial recourse and no recourse assignments. - CORRECT ANSWER-
Essentially determines the length of time, if any, the seller is responsible for the actions of the buyer.
Warranty disclaimers do not apply to _______ warranties on new or used vehicles to which that
warranty still applies. - CORRECT ANSWER- Manufacturer's
A(n) _______ clause allows the creditor to declare the entire outstanding balance due and payable. -
CORRECT ANSWER- Acceleration
As recorded on an installment sale agreement, the total sale price or deferred contract price would be
the total of the ________. - CORRECT ANSWER- -Payments
-Downpayment
,-Net Trade-In
Which is NOT listed as a mandated TILA box disclosure? - CORRECT ANSWER- Holder-in-Due Course
Notice
In most states, the _______ is deemed to be part of the purchase agreement. - CORRECT ANSWER-
Buyer's Guide
(True/False) Because the late charges that may be imposed on an installment sale agreement are
regulated at the state level, the amount of the late charge is NOT a required disclosure item. -
CORRECT ANSWER- False
At the time of consummation, an installment sale contract is between the _______ and the _______. -
CORRECT ANSWER- Customer, Dealer
The Truth in Lending Act and Reg. Z govern installment sale transactions for vehicles purchased for what
type(s) of uses? - CORRECT ANSWER- Personal, Family or Household
What is always the largest number on an installment sale agreement? - CORRECT ANSWER- The total
sale price
What is a contract? - CORRECT ANSWER- A contract is an agreement involving a promise or set of
promises that the law enforces or protects.
The formation of a contract requires three elements: - CORRECT ANSWER- 1. Offer
2. Acceptance
3. Consideration
, An offer consists of three elements: - CORRECT ANSWER- 1. An expression of a promise or
commitment (intent) to enter a contract
2. An expression of definite and certain terms
3. The communication of the offer to the offeree (in this case, the customer)
An offer may be terminated by: - CORRECT ANSWER- 1. An act of the parties
2. The operation of law
There are three criteria for the acceptance of an offer: - CORRECT ANSWER- 1. The offer is accepted
by one who is entitled to accept
2. The acceptance takes the proper form and is timely
3. The terms of acceptance reflect closely the terms of the offer and, therefore, do not amount to a
counteroffer
The Statute of Frauds - CORRECT ANSWER- Generally requires that all contracts involving the sale of
goods for a price of $500 or more be in writing.
The Statute of Frauds requires a written contract for the sale of goods for a price of _______ or more. -
CORRECT ANSWER- $500
What is required in order for the parties (the individuals entering into the contract) to have "legal
capacity?" - CORRECT ANSWER- The parties to the contract must be of legal age under the laws of the
state in which the contract is written.
Criteria that can block the formation of a valid contract: - CORRECT ANSWER- 1. The need for a
written agreement under the Statute of Frauds and certain provisions of the Uniform Commercial Code
(U.C.C.)
2. The need for legal capacity of a party to contract
3. The act of fraudulent inducement
