AAMS EXAM WITH 300 QUESTIONS CORRECT

AAMS EXAM WITH 300 QUESTIONS & CORRECT

ANSWERS GRADED A LATEST 2024

All of the following are major steps in the asset management process except

• Making and implementing recommendations
• Gathering Data
• Establishing Goals
• Establishing an asset allocation policy - ANSWER-D) Establishing an asset

allocation policy

Stefan's business plan includes the following goal: "I will contact 50 prospective clients and document this activity in the CRM for tracking purposes." Which primary element of a good goal is missing? This goal is not

• achievable.

B )relevant.

• time-framed.
• specific. - ANSWER-C) time-framed.

The acronym to remember for goal setting is S.M.A.R.T, which stands for Specific, Measurable, Achievable, Relevant, and Time-Framed. The flaw in this goal is that it is not time-framed

Which one of the following is NOT an invested asset?

• Real estate investment trust
• 401(k) account
• 180-day certificate of deposit 1 / 4

• Individual brokerage account - ANSWER-C) 180-day certificate of deposit

Victoria Gregory's financial situation is as follows:

Cash/cash equivalents$15,000 Short-term debts$23,000 Long-term debts$140,000 Taxes$8,000 Invested assets$45,000 Use assets$192,000

What is her net worth?

A) $112,000

B) $89,000

C) $81,000

D) $252,000 - ANSWER-B) $89,000

Assets = Cash/cash equivalents + Invested assets + Use assets ($15,000 + $45,000

• $192,000 = $252,000). Liabilities = Short-term debts + Long-term debts

($23,000 + $140,000 = $163,000). Assets - Liabilities = Net Worth, so $252,000 -

$163,000 = $89,000.

Which one of the following statements best describes the income statement?

• The income statement indicates, as of a definite date, the client's receipts and

disbursements.

• The income statement indicates, as of a definite date, what an individual owns

and owes. 2 / 4

• The income statement indicates, for a certain period of time, the growth of a

client's assets and liabilities.

• The income statement indicates, for a certain period of time, an individual's

cash inflows and outflows. - ANSWER-D) The income statement indicates, for a certain period of time, an individual's cash inflows and outflows.

All of the following provide a clearer picture of the client's needs except

• anticipated retirement lifestyle.
• the current rate of inflation.
• bad experiences with particular investments.
• Succession planning in place for a client involved in ownership of a small

business. - ANSWER-B) the current rate of inflation.

The current rate of inflation does not specifically provide insight into a client's needs, although the rate of future inflation anticipated by the client will have an impact on the client's future needs.

Which one of the following is considered a "foundation" goal?

• College funding
• Emergency fund
• Mortgage payoff
• Retirement savings - ANSWER-B) Emergency fund

Which one of these is the best written financial goal?

• Acquire $300,000 for retirement
• Accumulate $15,000 for a boat purchase in two years
• Make money in the stock market 3 / 4

• Establish a fund for purchasing a second home in five years - ANSWER-B)

Accumulate $15,000 for a boat purchase in two years

What is the appropriate date to identify the statement of financial position of a calendar-year client for the year 20XX?

• At December 31, 20XX
• For the period beginning January 1, 20XX
• For the period from January 1 to Decemebr 31, 20XX
• At January 1, 20X1 - ANSWER-A) At December 31, 20XX

How are assets valued on a statement of financial position?

• Residual value
• Actual cash value
• Replacement value
• Fair market value - ANSWER-D) Fair market value

All of these are topics that needs to be clarified before making investment recommendations except

• the client's goals.
• risk parameters of the client.
• basis for portfolio review.
• time horizons of the goals. - ANSWER-C) basis for portfolio review.

All of these are attributes of a good business plan except the plan

• is written.
• only includes business-related goals.
• / 4