Financial Planning II (FPII) - FP2 Exam Practice Test

Question 1

Xin Yi is a surgeon looking to get a disability insurance plan. His advisor has presented him with the following options:
Policy
Definition
Elimination period (days)
A
Any
30
B
Any
60
C
Own
30
D
Own
60
Which policy will likely have the highest premiums?

A. Policy C.

B. Policy A.

C. Policy B.

D. Policy D.

Correct Answer: A

Explanation: Only visible for Actualtests4sure members. You can sign-up / login (it's free).

Question 2

Sarah would like to add another stock holding to her portfolio. She is researching the financial condition of different companies and trying to determine their potential for future growth. What type of approach is Sarah taking when reviewing these companies?

A. Tactical asset allocation.

B. Technical analysis.

C. Fundamental analysis.

D. Passive investment strategy.

Correct Answer: C

Explanation: Only visible for Actualtests4sure members. You can sign-up / login (it's free).

Question 3

The rights to spousal support for unmarried spouses is established by which legislative document?

A. Family Law Act.

B. Civil Marriage Act.

C. British North America Act.

D. Divorce Act.

Correct Answer: A

Explanation: Only visible for Actualtests4sure members. You can sign-up / login (it's free).

Question 4

Peter and Anna have been feeling like their debt is out of control. They have several credit cards maxed out along with vehicle loans and are having trouble keeping up with all of the payments. The couple does not own a home, but both have stable employment. They are meeting with their financial advisor, Joy, to discuss options for their debt situation. What is the most suitable option for them?

A. Consolidation loan.

B. Automatic discharge.

C. Line of credit.

D. Bankruptcy.

Correct Answer: A

Explanation: Only visible for Actualtests4sure members. You can sign-up / login (it's free).

Question 5

What tax consideration should employers take into account when setting up a supplemental executive retirement plan (SERP)?

A. A SERP is eligible to be registered with the CRA provided that the employer makes a minimum contribution on behalf of the employee based on a percentage of the company's profits.

B. The employer does not receive a tax deduction for the SERP contribution until the employee receives the benefits.

C. A SERP permits higher tax-deductible contributions by the employer than those allowed under a registered retirement savings plan.

D. When a SERP is registered with the Canada Revenue Agency (CRA) under the Income Tax Act, it provides for the employers contributions to be tax-deductible.

Correct Answer: B

Explanation: Only visible for Actualtests4sure members. You can sign-up / login (it's free).

Question 6

Diana has begun receiving spousal support payments and child support payments from her ex-husband Bruce.
What tax planning issue should be of greatest concern to Diana?

A. The tax payable on child support payments.

B. The tax payable on spousal support payments.

C. The tax deductibility of child support payments.

D. The tax deductibility of spousal support payments.

Correct Answer: B

Explanation: Only visible for Actualtests4sure members. You can sign-up / login (it's free).

Question 7

William and Sage entered into a contract for Sage to purchase a building from William in three months' time, but the building had a fire and burned down after two months. What defense would best support the termination of this contractual relationship?

A. Performance.

B. Operation of law.

C. Breach of term.

D. Frustration.

Correct Answer: D

Explanation: Only visible for Actualtests4sure members. You can sign-up / login (it's free).

CSI Financial Planning II (FPII) - FP2 Exam Practice Test

Latest Update

Useful Links

Contact Us