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Free CDCS Practice Questions

10 free, exam-style Certificate for Documentary Credit Specialists (CDCS) practice questions with answers and explanations. No signup required. Work through them below, then take the full free CDCS practice test to study every exam domain.

The CDCS exam has 73 questions and runs 3 hours 15 minutes.

These 10 free CDCS questions are organized by exam domain, so you can see how each part of the Certificate for Documentary Credit Specialists blueprint is tested. Reveal the answer and explanation under each question.

Domain 1: Foundations of Documentary Credits

Question 1

A sales contract is concluded on CIF terms and a separate contract for identical goods is concluded on CIP terms. Both require the seller to arrange cargo insurance. Regarding the MINIMUM level of cover the seller must obtain under Incoterms 2020, which statement is correct?

  1. Both CIF and CIP require Institute Cargo Clauses (A)
  2. Both CIF and CIP require only Institute Cargo Clauses (C)
  3. CIF requires Institute Cargo Clauses (C); CIP requires Institute Cargo Clauses (A)
  4. CIF requires Institute Cargo Clauses (A); CIP requires Institute Cargo Clauses (C)
Show answer & explanation

Correct answer: C - CIF requires Institute Cargo Clauses (C); CIP requires Institute Cargo Clauses (A)

Question 2

An issuing bank issues an amendment containing three separate changes. The beneficiary sends a message to the advising bank stating that it accepts the change to the expiry date but rejects the change to the goods description and the change to the latest shipment date. How is this treated under UCP 600?

  1. Only the accepted change (the new expiry date) will take effect; the other two changes do not apply
  2. All three of the changes take effect, because the beneficiary responded to the amendment notice
  3. The notification is deemed to be a rejection of the amendment by the beneficiary in its entirety
  4. The amendment takes effect in full, as the beneficiary did not reject it in time
Show answer & explanation

Correct answer: C - The notification is deemed to be a rejection of the amendment by the beneficiary in its entirety

Question 3

An exporter wants the highest possible payment security and asks for a bank in its own country to add a binding undertaking to that of the issuing bank. The exporter's bank agrees and notifies the beneficiary accordingly. Which role has the exporter's bank assumed under UCP 600?

  1. Advising bank
  2. Reimbursing bank
  3. Nominated bank that has not acted on its nomination
  4. Confirming bank
Show answer & explanation

Correct answer: D - Confirming bank

Question 4

An applicant alleges that the beneficiary has shipped worthless goods and asks the issuing bank to refuse payment, even though the presented documents comply on their face with the terms of the credit. In the absence of a court injunction or clearly established fraud, how should the issuing bank act?

  1. Honour the complying presentation, because the credit is independent of the underlying contract
  2. Refuse to honour, because the applicant has alleged that the shipped goods are worthless
  3. Suspend payment until the applicant and beneficiary settle the quality dispute between themselves
  4. Honour the presentation only if the applicant first provides a written indemnity to the bank
Show answer & explanation

Correct answer: A - Honour the complying presentation, because the credit is independent of the underlying contract

Domain 2: Management of Documentary Credits

Question 5

An issuing bank receives a presentation and identifies genuine discrepancies. It sends a single refusal notice on the seventh banking day following the day of presentation, correctly listing every discrepancy and stating that it is holding the documents at the presenter's disposal. What is the bank's position under UCP 600?

  1. The refusal is effective, as the notice listed all discrepancies and the disposal of the documents
  2. The refusal is effective, provided the applicant has not waived the discrepancies in writing
  3. The bank may send a corrected notice within two further banking days to preserve its refusal
  4. The bank is precluded from claiming that the documents do not constitute a complying presentation
Show answer & explanation

Correct answer: D - The bank is precluded from claiming that the documents do not constitute a complying presentation

Question 6

A credit requires an insurance document. The presented insurance certificate is issued in the same currency as the credit, signed by the insurance company, and covers 100% of the CIF value of the goods. The credit is silent as to the percentage of insurance cover required. Which statement is correct?

  1. The document complies, because it covers the full CIF value of the goods as presented to the bank
  2. The document is discrepant, because cover must be at least 110% of the CIF value of the goods
  3. The document is discrepant, because an insurance certificate is never an acceptable form
  4. The document complies, because the credit did not state any required percentage of cover
Show answer & explanation

Correct answer: B - The document is discrepant, because cover must be at least 110% of the CIF value of the goods

Question 7

A nominated bank presents documents to the issuing bank. The beneficiary's address shown on the documents differs from the address stated in the credit, although both addresses are located in the same country. The credit makes no special stipulation about addresses. How should the issuing bank treat this?

  1. As a discrepancy, because all data on the documents must be identical to the credit
  2. As a discrepancy, because a beneficiary's address must always match the credit exactly
  3. As acceptable, but only if the beneficiary supplies a certificate explaining the difference
  4. As acceptable, because the addresses need not be identical when in the same country
Show answer & explanation

Correct answer: D - As acceptable, because the addresses need not be identical when in the same country

Question 8

A transferable credit is transferred in part to two second beneficiaries. The first beneficiary wishes to ensure that, after transfer, the insurance documents presented will still satisfy the cover required by the original credit. Under UCP 600, which of the following may be INCREASED when a credit is transferred?

  1. The amount of the credit available to be drawn by the beneficiaries
  2. The percentage for which insurance cover must be effected
  3. The unit price of the goods as stated in the credit
  4. The period allowed for presentation of the documents
Show answer & explanation

Correct answer: B - The percentage for which insurance cover must be effected

Question 9

A credit is available by acceptance of a draft drawn at 90 days after bill of lading date. The presented bill of lading bears an on-board notation dated 15 April. Documents are presented to the nominated bank on 28 April and accepted on 2 May. On what date does the accepted draft mature?

  1. 14 July (90 days after the on-board date of 15 April)
  2. 27 July (90 days after the presentation date of 28 April)
  3. 31 July (90 days after the acceptance date of 2 May)
  4. 15 May (30 days after the on-board date of 15 April)
Show answer & explanation

Correct answer: A - 14 July (90 days after the on-board date of 15 April)

Question 10

A bill of lading is presented under a credit that prohibits transhipment. The bill of lading is signed as follows: "OceanLine Shipping" with no further wording. The credit requires a bill of lading signed by the carrier, the master, or a named agent acting for or on behalf of the carrier or master. Which statement is correct?

  1. The document complies, because the printed company name alone is enough to indicate the carrier
  2. The document is discrepant, because it does not indicate the capacity in which it has been signed
  3. The document complies, because a bill of lading need not identify the capacity of the signatory
  4. The document is discrepant solely because transhipment is prohibited by the express terms of the credit
Show answer & explanation

Correct answer: B - The document is discrepant, because it does not indicate the capacity in which it has been signed

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