Free Microsoft Dynamics 365 Finance Functional Consultant (MB-310) Sample Questions

Correct answer: B — Use the 'Update prices' function on billing schedule lines, filtered by item group.

• A. Deleting and recreating billing schedules is inefficient, disruptive, and unnecessary. Dynamics 365 Finance provides built-in functionality to update prices without recreating schedules, and it risks losing billing history and existing schedule references.
• B. The 'Update prices' function on billing schedule lines allows you to filter by item group and apply new prices to all relevant lines, ensuring consistency and efficiency. This is the appropriate approach when prices need to be revised for a subset of billed items, as it updates only the relevant subscriptions.
• C. Modifying the unit price on the released product master does not automatically update existing billing schedule lines; it only affects new transactions. Subscription billing maintains its own pricing on the schedule, so this method does not apply to already-created schedules.
• D. Running the master planning batch recalculates production and inventory plans, not trade agreements or subscription billing prices. It is unrelated to the management of subscription billing price updates.

Correct answer: B — Subscription billing > Setup > Revenue and expense deferrals > Deferral defaults

• A. Incorrect. The 'General ledger > Journals setup > Deferral journals' path is used for configuring deferral journals in the general ledger, not for subscription billing deferral defaults. This option is too generic and not specific to subscription billing setup.
• B. Correct. The 'Subscription billing > Setup > Revenue and expense deferrals > Deferral defaults' path is the correct location to configure default deferral settings specifically for subscription billing. It determines the standard deferral behavior for revenue and expense recognition in subscription billing.
• C. Incorrect. The 'Accounts receivable > Setup > Charges > Deferral configuration' path is used for configuring deferral settings related to charges in accounts receivable, not for subscription billing deferral defaults. The path does not match the subscription billing setup area for revenue and expense deferrals.
• D. Incorrect. The 'Project management and accounting > Setup > Indirect cost deferrals' path is used for project-related deferrals, not subscription billing. This setup area is outside the subscription billing module and does not govern its revenue/expense deferral defaults.

Correct answer: B — It groups items that share the same billing frequency and invoice template settings.

• A. Incorrect. Warehouse and site are inventory and logistics concepts, not what a subscription billing group does. Delivery fulfillment is managed in inventory or warehouse management modules, not by billing groups.
• B. Correct. A subscription billing group is used to group items that share the same billing frequency and invoice template settings, ensuring consistent and standardized recurring billing processes.
• C. Incorrect. While financial dimensions can be associated with items, default dimensions for revenue postings are controlled through posting profiles or accounting setup, not by the subscription billing group itself.
• D. Incorrect. Customer price groups are used for pricing and discount logic, but they are managed separately. The subscription billing group focuses on billing configuration, not automatic discount calculations.

Correct answers: A, C — Click the 'Generate' button on the billing schedule line and select 'Sales order'.; Set the periodic 'Process billing schedules' job to output sales orders for that line.

• A. Correct. The 'Generate' button on the billing schedule line provides an option to create a sales order directly from the schedule, ensuring proper linkage and processing within the subscription billing workflow.
• B. Incorrect. While it is possible to manually create a sales order and link it via a reference field, this is not the standard or efficient method for generating a sales order from a billing schedule line. The system is designed to use the Generate button or periodic jobs for this purpose.
• C. Correct. The periodic 'Process billing schedules' job can be configured to automatically generate sales orders for billing schedule lines, streamlining the process and ensuring consistency.
• D. Incorrect. A purchase requisition is used for procurement scenarios, not for generating a sales order from a billing schedule line. This option mixes unrelated business processes and does not apply to subscription billing for customer sales documents.

Correct answer: B — Processed

• A. Incorrect. Draft is a status used before the collection letter is generated or finalized. After generation, the letter moves to a processed or sent state, not remaining in draft.
• B. Correct. Processed is a valid status for a collection letter after it has been generated. This indicates the system has completed the generation step and the letter is ready to be sent.
• C. Incorrect. Posted is a status used for financial documents posted to the ledger, not for collection letters. Collection letters do not use the 'Posted' status.
• D. Incorrect. While 'Sent' is a valid status that indicates the letter has been dispatched to the customer, it is not the status immediately after generation. The status right after generation is 'Processed'.

Correct answer: A — Set up a batch job for the statement process.

• A. Correct. A batch job must be set up for the statement process to automate the generation and sending of statements on a recurring schedule (e.g., monthly). Print management only controls the output destination (email), not the automation of when statements are produced and sent. Without a batch job, statements would not be generated or sent automatically.
• B. Incorrect. Assigning the statement to a collection agent is related to manual collections workflows and follow-up activities. It does not trigger automatic statement generation or emailing.
• C. Incorrect. A collection letter sequence is used for generating collection letters, not for customer account statements. This configuration is unrelated to the automatic monthly statement emailing process.
• D. Incorrect. A customer pool is used to group customers for processing (e.g., collections), but by itself it does not automate statement sending. The key requirement for automatic recurring statements is a batch job.

Correct answers: A, B, E — Increase the customer's credit limit amount.; Manually approve the sales order from hold list.; Post a customer payment to reduce balance.

• A. Correct. Increasing the credit limit directly removes the credit constraint, allowing the sales order to proceed once the limit covers the order value.
• B. Correct. Manually approving the sales order from the hold list overrides the automatic hold and releases the order without altering the customer's credit profile.
• C. Incorrect. Deleting and recreating the order does not resolve the underlying credit limit issue; the new order will still be placed on hold.
• D. Incorrect. Removing the credit limit entirely is not a standard remediation for a specific hold and weakens credit controls.
• E. Correct. Posting a customer payment reduces the outstanding balance, potentially bringing the customer back within their credit limit and releasing the hold.

Correct answers: A, C, E — The customer's historical on-time payment percentage.; The customer's total annual revenue amount.; The customer's external credit agency rating.

• A. Correct. The customer's historical on-time payment percentage is a direct indicator of payment reliability and is commonly used in risk scoring models to adjust credit limits.
• B. Incorrect. The number of employees is not a standard credit risk factor; it does not directly reflect the customer's ability or willingness to pay.
• C. Correct. Total annual revenue reflects the financial scale and capacity of the customer, supporting higher credit limits for larger revenues.
• D. Incorrect. The number of open invoices indicates current obligations but is not a standard input for automatic credit limit calculation in Dynamics 365; instead, factors like overdue days or balance are used.
• E. Correct. External credit agency rating provides an independent assessment of creditworthiness and is a standard factor in risk scoring.
• F. Incorrect. Industry classification is used for segmentation but is not a direct factor in the built-in risk scoring model for credit limits.

Correct answer: B — Minimum days overdue

• A. Incorrect. The grace period field typically refers to extra time allowed before late actions are taken, but it does not directly control when a collection letter is generated after the due date.
• B. Correct. The Minimum days overdue field specifies the number of days that must pass after the invoice due date before the collection letter is generated. This is the primary field used to trigger collection letters in Dynamics 365 Finance.
• C. Incorrect. Due date tolerance is not a standard field for collection letter sequences; it may relate to date flexibility in other processes but does not define the overdue threshold for generating collection letters.

Correct answer: A — A daily meal and incidental allowance based on location

• A. Correct. A per diem allowance in Dynamics 365 Finance is a daily allowance for meals and incidental expenses, typically varying by location. It simplifies expense reporting by providing a fixed daily rate, managed through per diem rules.
• B. Incorrect. This describes mileage reimbursement, which is based on distance traveled, not a daily allowance. Per diem is based on days and location, not miles.
• C. Incorrect. A ceiling on total expense amount is an expense limit or policy cap, not a per diem. Per diem refers to a specific daily allowance amount, not a maximum for the entire report.
• D. Incorrect. Splitting an expense across projects is expense allocation, which determines how costs are charged. Per diem is about reimbursing daily travel-related costs, not distributing across projects.

Correct answer: C — Expense report posting profiles

• A. Incorrect. Intercompany expense accounting is used to manage expenses between legal entities, not for mapping expense categories and departments to ledger accounts. It does not control the standard posting setup for expense report transactions.
• B. Incorrect. Per diem allocation rule setup is used to define how per diem expenses are calculated and allocated across periods, not for posting to ledger accounts. It does not define ledger posting accounts for expense categories and departments.
• C. Correct. Expense report posting profiles define the ledger accounts where expense transactions are posted, based on criteria such as expense category and employee department. They are used to map expense categories and related dimensions to the proper ledger accounts.
• D. Incorrect. Mileage rate formula configuration determines how mileage reimbursements are calculated, such as by distance and rate. It affects reimbursement amounts, but not the ledger account mapping for posting expense report transactions.

Correct answers: A, B — Personal vehicle rate by mile; Company vehicle rate by mile

• A. Correct. Personal vehicle rate by mile is a standard mileage expense calculation method in Dynamics 365 Finance, where employees are reimbursed based on the distance traveled using their personal vehicle.
• B. Correct. Company vehicle rate by mile is another valid method, where reimbursement is calculated based on the distance traveled using a company-provided vehicle.
• C. Incorrect. Per diem meal allowance is a separate expense reimbursement method for meals and incidental expenses during travel, not a mileage calculation method.
• D. Incorrect. Fixed amount per trip is a flat-rate reimbursement approach that does not depend on distance traveled; it is not considered a mileage expense calculation method in Dynamics 365 Finance.
• E. Incorrect. Public transportation fare refers to reimbursement for actual fares paid for public transport, not a mileage calculation method.

Correct answers: A, C, E — Per diem rounding policy; Personal expense reimbursement policy; Mileage rate override policy

• A. Correct. Per diem rounding policy is a standard expense report policy type that defines how per diem amounts are rounded (e.g., up or down) when employees submit expense reports.
• B. Incorrect. Duplicate expense detection is a validation feature to identify duplicate submissions, not a policy type for expense reports.
• C. Correct. Personal expense reimbursement policy defines rules for reimbursing employees for out-of-pocket expenses, including limits, categories, and approval workflows.
• D. Incorrect. Expense report approval limit is part of workflow configuration or approval rules, not a standalone policy type for expense reports.
• E. Correct. Mileage rate override policy allows organizations to define custom mileage rates for specific scenarios or employee groups, overriding default rates.
• F. Incorrect. Intercompany expense allocation policy relates to ledger allocations or cost accounting, not a standard expense report policy type.

Correct answer: C — deducted from the total reimbursement

• A. Incorrect. Approval by the employee's manager is typically required for expense reports, but it does not specifically address the handling of personal expenses. The key requirement is that the personal amount is separated from reimbursable business expenses so it is not paid to the employee, not simply obtaining managerial approval.
• B. Incorrect. Reallocating a personal expense to a different project does not resolve the issue, as personal expenses are not eligible for reimbursement regardless of the project. They must be identified and excluded from reimbursement rather than moved to another project.
• C. Correct. A personal expense must be deducted from the total reimbursement amount before posting to ensure the employee is not reimbursed for the personal portion. This reflects standard expense management treatment of non-business expenses.

Correct answer: B — Create the vendor in one legal entity and mark it as a shared vendor.

• A. Incorrect. Creating a separate vendor in each legal entity does not create a true shared vendor record across companies. Linking them with a vendor sequence number does not replace the need for the shared vendor setup used in Dynamics 365 Finance.
• B. Correct. A shared vendor is created in one legal entity and then available for use across other legal entities, which is the intended approach for vendors that must be maintained centrally. This supports consistency and reduces duplicate vendor master data.
• C. Incorrect. Intercompany vendor synchronization is not the standard method for creating a shared vendor master across legal entities. It is used in intercompany scenarios and does not replace the shared vendor feature.
• D. Incorrect. Vendor collaboration and vendor portal approval are used for onboarding and communication with vendors, not for making a vendor shared across legal entities. They help manage the vendor approval process but do not create the shared vendor record itself.

Correct answers: A, B, D — Two-way matching; Three-way matching; Charges matching

• A. Two-way matching is a standard policy that compares the purchase order to the vendor invoice, verifying quantities and prices without requiring a product receipt.
• B. Three-way matching is a standard policy that compares the purchase order, product receipt, and vendor invoice to ensure ordered quantities were received and correctly billed.
• C. Four-way matching is not a standard invoice matching policy in Dynamics 365 Finance and Operations; it is not part of the default matching options.
• D. Charges matching is a standard policy that validates additional charges (e.g., freight, taxes) on the invoice against amounts specified on the purchase order or receipt.
• E. Line matching is not a standard invoice matching policy; it is a detailed validation step that may be used within other matching policies but is not a standalone option.
• F. Price matching is not a standalone policy; it is a component of two-way and three-way matching, which already include price validation.

Correct answers: A, C — Charges codes are used to add additional costs to invoices.; Charges codes can auto-allocate charges across lines.

• A. Correct. Charges codes are used to add additional costs such as freight, handling, or miscellaneous fees to invoices, purchase orders, or other transactions, capturing expenses beyond base line amounts.
• B. Incorrect. Charges can be applied to various transactions, including purchase order invoices, project invoices, and sales orders, not just purchase order invoices.
• C. Correct. Charges codes can be configured to automatically allocate charges across multiple lines based on predefined rules (e.g., by quantity, amount, or weight), helping distribute costs accurately without manual entry.
• D. Incorrect. Charges are not always posted to the same ledger account as the invoice; they can be posted to specific accounts based on charge code setup and accounting distributions (e.g., a separate freight expense account).
• E. Incorrect. Charges codes are not required to be assigned to a vendor group; their setup is typically based on charge type and accounting rules, independent of vendor groups.
• F. Incorrect. Charges can often be added or adjusted before and after invoice posting, depending on configuration and document status; they are not limited strictly to pre-posting entry.

Correct answer: B — Set up a revaluation profile.

• A. Running the revaluation periodic task is the execution step, not the prerequisite. The question asks what is required before revaluation can be performed.
• B. Correct. A revaluation profile must be set up to define parameters such as accounts, exchange rate type, and posting rules. This is a mandatory configuration step before running vendor foreign currency revaluation.
• C. Posting vendor invoices in foreign currency creates the open transactions that will be revalued, but it is a business transaction, not a setup or revaluation action.
• D. Revaluation cannot be run before invoices are posted because there would be no vendor balances to revalue. The process depends on existing open foreign currency transactions.
• E. Exchange rates are not manually adjusted on individual vendor transactions in Dynamics 365 Finance. Revaluation uses the current exchange rate from the system or revaluation profile.
• F. Generating a revaluation report is an informational step used to review results after revaluation, but it is not a prerequisite for performing the revaluation.

Correct answer: C — Move budget amounts between different financial dimensions.

• A. Incorrect. Budget transfer rules do not define approval workflows. Approval workflows for budget adjustments and transfers are handled through separate workflow configurations or budget control settings, not by budget transfer rules.
• B. Incorrect. Budget transfer rules do not compute automatic budget allocations. Automatic allocations are handled by budget allocation rules or other budgeting features, not by budget transfer rules.
• C. Correct. Budget transfer rules are specifically designed to move budget amounts between different financial dimensions, such as departments, cost centers, or projects. They support controlled reallocation of budget within the ledger structure.
• D. Incorrect. Setting budget limits for purchase requisitions and orders is a function of budget control configurations, not budget transfer rules. Budget transfer rules do not establish spending thresholds or document controls.

Correct answer: B — The period groups used for budget allocations.

• A. Incorrect. The number of fiscal years covered by the budget is determined by the budget cycle or budget plan horizon, not the time span setting in the budget model. The time span specifies how amounts are distributed across periods within a fiscal year.
• B. Correct. The time span setting in a budget model defines the period groups used for budget allocations, such as monthly, quarterly, or other fiscal period groupings. This controls how budget amounts are spread across the model's periods.
• C. Incorrect. Budget register entry approvals are managed through workflow and approval configurations, not by the budget model time span setting. The time span does not affect the approval process.
• D. Incorrect. The frequency of budget versus actual comparisons is handled through budget control, reporting, and inquiry features. The time span only affects how budget values are allocated over time, not comparison frequency.

Correct answer: A — Create a budget transfer rule with approval workflow.

• A. Correct. Budget transfer rules in Dynamics 365 Finance can be configured with approval workflows to ensure that budget adjustments, such as moving funds between departments or categories, require authorization from designated approvers like the finance director. This supports controlled reallocation of budget amounts and ensures the finance director can approve the change before it is posted.
• B. Incorrect. Posting a general journal entry does not inherently enforce an approval workflow for budget adjustments. While notes can be attached, this method lacks the structured control and audit trail required for budget transfers. A general journal entry is used for financial posting, not for controlling budget changes between budget lines.
• C. Incorrect. Allocation terms are used for automatic distribution of funds based on predefined rules (e.g., percentages or formulas), not for manual, one-time budget transfers that require approval. They also do not address the required approval by the finance director.
• D. Incorrect. Directly adjusting a budget register entry bypasses approval workflows and does not provide the necessary controls or auditability for budget transfers that require finance director approval. This would not enforce the finance director's approval before the budget move is made.

Correct answer: C — Budget vs. actuals

• A. Incorrect. Budget control statistics monitor budget control activities and thresholds, not a direct budget-to-actual comparison.
• B. Incorrect. The General ledger trial balance shows account balances but is not the dedicated inquiry for comparing budgeted values with actual values.
• C. Correct. The Budget vs. actuals inquiry is specifically designed to compare budgeted amounts with actual posted amounts, allowing users to analyze variances.

Correct answer: A — They define the steps a budget plan follows from its initial creation through to final approval

• A. This is correct — budget planning stages define the steps a budget plan follows from its beginning through final approval, and are arranged within budget planning workflows.
• B. This describes a budget plan scenario, which holds categories of monetary or quantity data, not a stage.
• C. This describes a budget planning process, which is related to one budget cycle and one ledger, rather than a stage.
• D. This describes budget control validation, a separate feature that enforces spending limits on transactions, not budget planning stages.

Correct answer: A — A dedicated organization hierarchy assigned specifically to the budget planning process, separate from the operational hierarchy

• A. This is correct — the budget planning hierarchy does not have to match the standard organization hierarchy, so a separate hierarchy can be assigned specifically to the budget planning process to aggregate and distribute data as needed.
• B. Creating a new legal entity does not address the need for a distinct aggregation structure and would unnecessarily change the underlying entity setup.
• C. Budget control rule groups govern real-time transaction validation against available funds, not the collaborative hierarchy used for planning and forecasting.
• D. Sharing a financial dimension set does not change how budget plans are aggregated or distributed across a hierarchy of responsibility centers.

Correct answer: A — Aggregate, which combines budget plan lines from the associated budget plans into the destination scenario of the parent plan

• A. This is correct — aggregate combines budget plan lines from a source scenario in the associated budget plans into the destination scenario of the parent plan, which matches consolidating Sales department forecasts at headquarters.
• B. Distribute moves data the opposite direction, pushing amounts from a parent plan down to associated plans, which fits the earlier baseline-distribution step, not the forecast rollup.
• C. Allocate across periods spreads amounts over time periods within a scenario and does not consolidate submissions from multiple budget plans.
• D. Allocate to dimensions spreads amounts across financial dimensions and does not combine lines from separate associated budget plans.

Correct answer: A — budget plan scenarios

• A. This is correct — budget plan scenarios define categories of monetary or quantity data, such as prior year sales or FTE counts, used within a budget plan.
• B. Budget planning stages describe the steps a plan follows toward approval, not the categories of monetary or quantity data it holds.
• C. Budget planning processes are the rules governing how plans are routed and approved, not the data categories used within a plan.

Correct answer: B — Generate a disposal sale proposal; create a free text invoice from the proposal; post the free text invoice.

• A. Incorrect. The disposal sale proposal must be generated before creating the free text invoice to properly link the sale to the fixed asset disposal. Posting the invoice first does not trigger the disposal process.
• B. Correct. The correct sequence is to generate a disposal sale proposal, which calculates the gain and creates the necessary fixed asset journal entries. Then create and post the free text invoice from the proposal to record the sale and gain.
• C. Incorrect. Creating an FA journal for the sale first bypasses the disposal proposal process, which is needed to properly calculate the gain and link the sale to the asset disposal.
• D. Incorrect. Posting the free text invoice alone does not dispose of the asset in the fixed asset subledger. Manually creating an FA journal after is not the intended workflow; the disposal must be initiated through the sale proposal.

Correct answer: A — Inventory to fixed asset

• A. Correct. The 'Inventory to fixed asset' journal type is specifically designed to convert inventory items into fixed assets, allowing the transfer of cost and other details from inventory to the fixed asset module and creating the corresponding fixed asset acquisition.
• B. Incorrect. The 'Fixed asset journal' is used for posting fixed asset transactions directly, such as acquisitions, depreciation, or disposals, but not for converting inventory through an inventory journal.
• C. Incorrect. The 'Inventory adjustment' journal type is used to correct inventory quantities or values, not to create or acquire fixed assets.
• D. Incorrect. The 'Transfer' journal type is used to move inventory between locations, sites, or warehouses, not to capitalize inventory into a fixed asset.

Correct answer: A — primary

• A. Correct. In Dynamics 365 Finance, derived books inherit their depreciation calculations from the primary book. The depreciation proposal must be run for the primary book, which then applies the appropriate depreciation results to the derived book based on its setup.
• B. Incorrect. Derived books do not process depreciation independently; they rely on the primary book's depreciation proposal. Running the proposal directly on a derived book is not supported.
• C. Incorrect. The depreciation proposal cannot be run for either book interchangeably. It must always be run for the primary book first to ensure the derived book is updated correctly.

Correct answer: B — Disposal - Scrap

• A. Incorrect. The 'Disposal - Sale' posting profile is used when a fixed asset is sold, not scrapped. It handles the gain or loss on sale, including proceeds, and does not govern the write-off of remaining net book value for a scrap transaction.
• B. Correct. The 'Disposal - Scrap' posting profile is specifically designed for scrapping fixed assets. It determines the general ledger accounts used to write off the remaining net book value of the asset, posting the loss to the appropriate accounts.
• C. Incorrect. The 'Acquisition' posting profile is used for purchasing or capitalizing new fixed assets, not for disposal or scrapping. It does not determine accounts for removing an asset from the books.
• D. Incorrect. The 'Depreciation' posting profile is used for recording periodic depreciation expense, not for disposal transactions. Scrapping an asset requires a disposal profile, not a depreciation profile.

Correct answer: A — copied

• A. Correct. In Dynamics 365 Finance, a derived book inherits its acquisition value directly from the primary book, ensuring consistency. The value is copied rather than calculated separately.
• B. Incorrect. A derived book does not calculate the acquisition value independently; it is derived from the primary book to maintain alignment. Independent calculation applies to separate books, not derived ones.
• C. Incorrect. 'Not applicable' is not correct because the acquisition value is a relevant and necessary value for a derived book, brought over from the primary book.

Correct answer: B — Fixed asset parameters

• A. Incorrect. Depreciation profiles define the depreciation method (e.g., straight-line, declining balance) and other settings, but not the default depreciation convention.
• B. Correct. The Fixed asset parameters form is used to configure company-wide defaults for fixed assets, including the default depreciation convention (e.g., full month, mid-month). This setting applies globally unless overridden at a lower level.
• C. Incorrect. Fixed asset groups are used to categorize assets for reporting and posting purposes, but they do not configure the default depreciation convention.
• D. Incorrect. Fixed asset books define book-specific depreciation settings for individual assets, but the default depreciation convention is set at the parameter level, not the book level.

Correct answer: A — Posting layer

• A. Correct. The Posting layer property determines whether the tax book's transactions are posted to the general ledger. Setting it to 'Tax' ensures tax depreciation does not affect financial statements.
• B. Incorrect. The Depreciation profile defines the depreciation method and periods but does not control the posting layer or separation from financial statements.
• C. Incorrect. The Alternative depreciation profile is used for special depreciation methods but does not manage the posting layer or financial statement impact.
• D. Incorrect. The Depreciation convention defines the timing of depreciation (e.g., mid-month) but does not control whether tax depreciation affects financial statements.

Correct answers: A, D, E — Straight line; Reducing balance; Units of production

• A. Correct. Straight line depreciation is a standard built-in method in Dynamics 365 Finance, allocating the depreciable amount evenly over the asset's useful life.
• B. Incorrect. Double declining balance is not a separate out-of-the-box method; it is a specific rate variant of the reducing balance method, which is available.
• C. Incorrect. Sum of years digits is not provided as an out-of-the-box depreciation method in Dynamics 365 Finance.
• D. Correct. Reducing balance (declining balance) is a standard method, calculating depreciation based on a fixed percentage of the remaining book value.
• E. Correct. Units of production (consumption) method is available out-of-the-box, depreciating assets based on usage or output.
• F. Incorrect. Custom formula is not a standard method; it would require user-defined configuration outside the box.

Correct answer: C — Convention

• A. Incorrect. Scrap value is an optional parameter in the depreciation profile. It represents the residual value of the asset after its service life, but it is not a mandatory field for the straight line method.
• B. Incorrect. The depreciation period is not a required field for the straight line method. The service life already defines the duration over which the asset is depreciated; the depreciation period (e.g., yearly, monthly) is typically defaulted and does not need to be explicitly specified alongside service life.
• C. Correct. The convention (e.g., half-year, full-month) is required to determine how depreciation is calculated in the first and last years of the asset's life. It defines the timing of depreciation recognition and is a mandatory field when using the straight line service life method.
• D. Incorrect. The calendar is not a required field for the depreciation profile. It is used for fiscal year configurations but is not directly tied to the core requirements of the straight line method.