1|Page
AFIP Basic Certification Actual Exam Newest AFIP
Basic Certification Exam Preparation/AFIP Basic
Certification Practice Exam With Complete Questions
And Correct Answers| Newest Version!!!!
(True/False): Ignorance of the law will shield you from
liability if you are noncompliant. - 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. - Answer-
True
In a typical credit transaction the (bank)/(dealer) is the
creditor. - Answer-The dealer is the creditor
What is a contract? - 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: -
Answer-1. Offer
2. Acceptance
3. Consideration
,2|Page
An offer consists of three elements: - 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: - Answer-1. An act of the
parties
2. The operation of law
There are three criteria for the acceptance of an offer: -
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 - Answer-Generally requires that all
contracts involving the sale of goods for a price of $500 or
more be in writing.
,3|Page
The Statute of Frauds requires a written contract for the
sale of goods for a price of _______ or more. - Answer-
$500
What is required in order for the parties (the individuals
entering into the contract) to have "legal capacity?" -
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: -
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
What is "consideration" as it applies to a contract? -
Answer-The requirement that each party to the contract
receives something of value in exchange for what is given.
Finance Charge - 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.
, 4|Page
How the Itemization of Amount Financed is completed -
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 - 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 - Answer-Promise
to Pay - This section outlines the purpose of the
AFIP Basic Certification Actual Exam Newest AFIP
Basic Certification Exam Preparation/AFIP Basic
Certification Practice Exam With Complete Questions
And Correct Answers| Newest Version!!!!
(True/False): Ignorance of the law will shield you from
liability if you are noncompliant. - 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. - Answer-
True
In a typical credit transaction the (bank)/(dealer) is the
creditor. - Answer-The dealer is the creditor
What is a contract? - 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: -
Answer-1. Offer
2. Acceptance
3. Consideration
,2|Page
An offer consists of three elements: - 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: - Answer-1. An act of the
parties
2. The operation of law
There are three criteria for the acceptance of an offer: -
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 - Answer-Generally requires that all
contracts involving the sale of goods for a price of $500 or
more be in writing.
,3|Page
The Statute of Frauds requires a written contract for the
sale of goods for a price of _______ or more. - Answer-
$500
What is required in order for the parties (the individuals
entering into the contract) to have "legal capacity?" -
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: -
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
What is "consideration" as it applies to a contract? -
Answer-The requirement that each party to the contract
receives something of value in exchange for what is given.
Finance Charge - 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.
, 4|Page
How the Itemization of Amount Financed is completed -
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 - 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 - Answer-Promise
to Pay - This section outlines the purpose of the
