FINRA Investment Company and Variable Contracts Products Representative Examination (IR) Sample Questions:

1. Which of the following statements regarding both a Uniform Gifts to Minors account (UGMA) and a
Uniform Transfers to Minors account (UTMA) is false?

A) Once established, the account is irrevocable.
B) The account must be established in the name of one minor child only.
C) There can be only one custodian named on the account.
D) The assets must be re-registered in the minor child's name when the child turns 18.

2. Paul is 36 years old and is married with two children, ages eight and ten. Paul lays carpet for a living,
working as an independent contractor, and earns about $35,000 a year. His wife, Paula, is 33 years old,
drives a school bus and earns only $18,000 a year, but her job provides the family with low-cost health
insurance. They live conservatively and barely make ends meet. Paula recently inherited $180,000,
however, and the couple would like to invest it, with the goal that they can both retire when Paul turns
6 2.The inheritance also included an educational endowment for their children, so they will not have to
worry about saving for their children's college educations. Which of the following would not be a suitable
recommendation for the allocation of their investment monies?

A) aggressive growth stock fund
B) life insurance
C) Roth IRA
D) municipal bond fund

3. Ms. Newbie, a newly-minted registered representative with Savvy Investments, just had her first client
walk through the door. The new account form that the client receives a copy of must contain the
signatures of:
I. the client.
II. Ms. Newbie.
III. Ms. Newbie's branch manager/supervisor.

A) I and II only
B) I, II, and III
C) I only
D) II and III only

4. A fund's transfer agent is responsible for:
I. calculating and distributing the capital gain and dividend income of the fund.
II. mailing shareholder account statements.
III. paying fund expenses.

A) I and II only
B) I, II, and III
C) I only
D) II only

5. After three warnings, Honest Investments was forced to terminate Sly Conman, one of its representatives,
for making inaccurate statements when offering its mutual fund products to customers. Given this
scenario:

A) Honest must provide FINRA with an electronic notification of the termination within 48 hours and
provide a written copy of the submitted form to Mr. Conman within 30 days of the filing.
B) Honest must provide FINRA with an electronic notification of the termination within 48 hours and mail a
written copy of the submitted form to both FINRA and Mr. Conman within 14 days.
C) Honest must provide FINRA with an electronic notification of the termination within 48 hours and
provide a written copy of the submitted form to Mr. Conman within 10 business days.
D) Honest must provide FINRA with an electronic notification of the termination within 30 days and provide
a written copy of the submitted form to Mr. Conman within that same period of time.

Solutions: