Travel Agent Proficiency Test Final Review
questions with answers
Fixed Expenses - CORRECT ANSWERS ✔✔costs that remain
unchanged during a specific period despite changes in the volume
of business.
Variable Expenses - CORRECT ANSWERS ✔✔are costs that
increase and decrease directly and proportionately with changes in
business volume.
Semi-Variable or Mixed Expenses - CORRECT ANSWERS ✔✔are
costs that change in response to a change in business volume, but
they change by less than a proportional amount.
Income Statement - CORRECT ANSWERS ✔✔summarizes
revenues earned and expenses incurred for a particular period
Balance Sheet - CORRECT ANSWERS ✔✔it shows the financial
position of a business at a particular time and may compare it to the
,business's position at the same time of a previous year. This
includes assets, liability and equity
Suppliers receive payment in four ways - CORRECT ANSWERS
✔✔Directly from client
CC company
In the form of checks from agencies
Through ARC (Airline Reporting Corporation)
Agents Receive Payments in 3 Ways - CORRECT ANSWERS
✔✔Through ARC
By deducting commission prior to sending to supplier
By check from supplier
ARC (AIRLINE REPORTING CORP) - CORRECT ANSWERS
✔✔an organization owned by major airlines that regulates the sale
of airline tickets by appointing those who may sell them.
Accountable Documents - CORRECT ANSWERS ✔✔issues
standardized numbered forms that serve as tickets, and it operates a
centralized system for processing sales.
,Area Bank Settlement Plan - CORRECT ANSWERS ✔✔the system
set up by ARC through which participating suppliers receive
payments for sales by travel agencies
ARC Report - CORRECT ANSWERS ✔✔Each travel agency pays
the ARC suppliers weekly by electronically filing a mandatory
report of sales
base fare - CORRECT ANSWERS ✔✔the fare shorn of all taxes
Escrow Account - CORRECT ANSWERS ✔✔An account held by a
third party or a bank that holds on to funds until all requirements
are fulfilled for them to be released
overrides - CORRECT ANSWERS ✔✔bonus commissions to
agencies that meet various sales goals or move clients to the
supplier's products
Income for Travel Agencies - CORRECT ANSWERS
✔✔Commission on sales of transportation, accommodation,
, cruises, tours and other services
Override commissions
Fees and service charges
Markups on net charges
Cost Benefit Analysis - CORRECT ANSWERS ✔✔A tool
entrepreneurs use to hold down expenses and ensure profits (ex.
Buying flowers or gifts for a client)
Consortium - CORRECT ANSWERS ✔✔which is an association of
agencies that retain their independent identities but pool their
resources for certain purposes
Miscellaneous Charges Order (MCO) - CORRECT ANSWERS
✔✔It records deposits and full prepayments for transportation, tour
packages, supplemental charges, accommodations, or additional
collections. A clear description of the type of service for which it is
issued must be indicated on the MCO.
Voucher - CORRECT ANSWERS ✔✔Any document used to
confirm arrangements, identify clients, or indicate payments made
questions with answers
Fixed Expenses - CORRECT ANSWERS ✔✔costs that remain
unchanged during a specific period despite changes in the volume
of business.
Variable Expenses - CORRECT ANSWERS ✔✔are costs that
increase and decrease directly and proportionately with changes in
business volume.
Semi-Variable or Mixed Expenses - CORRECT ANSWERS ✔✔are
costs that change in response to a change in business volume, but
they change by less than a proportional amount.
Income Statement - CORRECT ANSWERS ✔✔summarizes
revenues earned and expenses incurred for a particular period
Balance Sheet - CORRECT ANSWERS ✔✔it shows the financial
position of a business at a particular time and may compare it to the
,business's position at the same time of a previous year. This
includes assets, liability and equity
Suppliers receive payment in four ways - CORRECT ANSWERS
✔✔Directly from client
CC company
In the form of checks from agencies
Through ARC (Airline Reporting Corporation)
Agents Receive Payments in 3 Ways - CORRECT ANSWERS
✔✔Through ARC
By deducting commission prior to sending to supplier
By check from supplier
ARC (AIRLINE REPORTING CORP) - CORRECT ANSWERS
✔✔an organization owned by major airlines that regulates the sale
of airline tickets by appointing those who may sell them.
Accountable Documents - CORRECT ANSWERS ✔✔issues
standardized numbered forms that serve as tickets, and it operates a
centralized system for processing sales.
,Area Bank Settlement Plan - CORRECT ANSWERS ✔✔the system
set up by ARC through which participating suppliers receive
payments for sales by travel agencies
ARC Report - CORRECT ANSWERS ✔✔Each travel agency pays
the ARC suppliers weekly by electronically filing a mandatory
report of sales
base fare - CORRECT ANSWERS ✔✔the fare shorn of all taxes
Escrow Account - CORRECT ANSWERS ✔✔An account held by a
third party or a bank that holds on to funds until all requirements
are fulfilled for them to be released
overrides - CORRECT ANSWERS ✔✔bonus commissions to
agencies that meet various sales goals or move clients to the
supplier's products
Income for Travel Agencies - CORRECT ANSWERS
✔✔Commission on sales of transportation, accommodation,
, cruises, tours and other services
Override commissions
Fees and service charges
Markups on net charges
Cost Benefit Analysis - CORRECT ANSWERS ✔✔A tool
entrepreneurs use to hold down expenses and ensure profits (ex.
Buying flowers or gifts for a client)
Consortium - CORRECT ANSWERS ✔✔which is an association of
agencies that retain their independent identities but pool their
resources for certain purposes
Miscellaneous Charges Order (MCO) - CORRECT ANSWERS
✔✔It records deposits and full prepayments for transportation, tour
packages, supplemental charges, accommodations, or additional
collections. A clear description of the type of service for which it is
issued must be indicated on the MCO.
Voucher - CORRECT ANSWERS ✔✔Any document used to
confirm arrangements, identify clients, or indicate payments made
