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These 10 free CCBCA questions are organized by exam domain, so you can see how each part of the Certified Community Bank Credit Analyst blueprint is tested. Reveal the answer and explanation under each question.
A distributor's annual review shows these changes: Receivable days: 36 to 54. Inventory days: unchanged at 40. Payable days: 24 to 42. Cash conversion cycle: unchanged at 52 days. Supplier terms remain 30 days, and overdue supplier balances have grown. The loan officer calls liquidity stable. What does that conclusion overlook?
Correct answer: C - Stable cycle length masks slower collections financed by overdue supplier balances.
A proposed loan must pass a 1.25x coverage test: EBITDA excluding asset-sale gains divided by annual scheduled principal and interest on all debt after closing. The manufacturer's latest annual EBITDA is $330,000, including a $70,000 gain from selling an idle machine for $110,000 cash. The coming year requires $90,000 principal on existing debt, $60,000 on the new loan, and $50,000 combined interest. No other adjustments apply. Does the request pass this test?
Correct answer: B - 1.30x; the minimum is met.
A guarantor's personal cash-flow worksheet includes $160,000 of ordinary income allocated on a partnership Schedule K-1 and another $30,000 of verified cash distributions. The partnership retained the rest of its earnings and is barred from further distributions during the period being analyzed. No other cash was paid to the guarantor. Which entry represents gross cash received from this investment?
Correct answer: D - The $30,000 distribution, not the $160,000 tax allocation.
A married sole proprietor qualifies for a loan secured by a jointly owned warehouse without relying on the spouse's income or guaranty. The spouse is not an applicant. Counsel confirms that applicable law requires both owners to sign the deed of trust but does not require the spouse to sign the note. Under Regulation B, what may the bank require?
Correct answer: D - The spouse's signature on the deed of trust, without requiring personal liability.
An established grain producer's verified cash budget places seed and fertilizer purchases in April-June and sufficient crop receipts in November to repay production costs and interest after other obligations. Equipment has separate financing. With other credit standards met, the operating facility should provide:
Correct answer: A - Seasonal advances with repayment from November crop-sale proceeds.
Signed contracts fix a fabricator's selling prices for 12 months, but steel will be purchased at market prices with no cost pass-through. Management projects historical gross margins. What sensitivity test addresses the resulting risk to repayment?
Correct answer: A - Stress steel costs while keeping selling prices at their contracted levels.
The September 30 covenant test shows leverage of 3.6x against a 3.0x maximum. An owner's cash equity contribution on October 10 reduces current leverage to 2.8x. The agreement tests leverage at quarter-end, contains no equity-cure provision, and has not been amended or waived. Loan payments remain current. How should the analyst record the September test?
Correct answer: B - Record a September breach and separately document the October equity contribution.
The agreement for a $600,000 revolver excludes invoices awaiting customer acceptance. Its borrowing limit is 80% of eligible receivables plus 50% of eligible inventory, less a $20,000 reserve, capped by the commitment. Receivables total $600,000; $150,000 await acceptance and the rest are eligible. Eligible inventory is $260,000. Usage consists of $390,000 in loans and a $30,000 letter of credit. With no overadvance permitted, what additional cash advance is available?
Correct answer: C - $50,000
A $180,000 revolver advance is awaiting release when an analyst independently confirms that invoices supporting today's borrowing certificate were canceled last month. Removing them leaves no availability. The agreement prohibits overadvances, and no exception has been approved. The borrower says payroll is due today. Which response addresses the immediate exposure?
Correct answer: D - Hold the advance and notify credit and fraud personnel; payroll urgency does not create availability.
'Double the April-September profit to estimate full-year earnings,' says a marina's draft credit memo. Three years of monthly results show that nearly all revenue is earned in those six months, while winter fixed costs continue. Select the replacement that preserves the interim evidence without overstating annual earnings.
Correct answer: A - Project winter income and expenses separately instead of doubling peak-season profit.
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