IMA CMA Part 1: Financial Planning - Performance and Analytics Sample Questions:

1. A company manufactures dining tables. The variable costs per unit are as follows.

Other costs are fixed and include advertising costs of $45,000 per year administrative costs of $55,000 annually and fixed manufacturing overhead of S250.000 per year based on Budgeted production of 10.000 dining tables There was no beginning inventory During the prior year, a total of 10.000 dining tables were manufactured, with 9 000 dining tables sold at $100 each Based on the above information what would be the cost of the ending finished goods inventory under absorption (full) costing?

A) $70,000.
B) $100,000.
C) $80,000.
D) $45,000.

2. After a recent earthquake in a nearby city the board of directors of a company has requested a review of the company s disaster recovery plan Which of the following would be classified as a weakness in the company's disaster recovery plan?

A) The details of the disaster recovery plan stipulate that internal audit should review the plan every other year rather than annually.
B) A cold site with backup data and documents is maintained on the basement level of the company s headquarters.
C) Members of the company's disaster recovery team maintain current copies of the disaster recovery plan m their homes.
D) Management has decided not to maintain a hot site because it was determined that the costs outweigh the benefits.

3. In developing a risk-based approach to internal control, a company is considering the risks posed to various accounts due to the complex calculations involved as well as industry factors that make measurement difficult.
These risk factors are part of

A) control risk
B) inherent risk
C) systems risk
D) account level risk

4. Which one of the following best describes the difference between a normal costing system and an actual costing system?

A) Both direct labor cost and direct material cost are estimated using a predetermined rate under a normal costing system, while they are the actual value under an actual costing system
B) Direct labor cost is estimated using a predetermined rate under a normal costing system, while it is the actual value under an actual costing system.
C) Direct material cost is estimated using a predetermined rate under a normal costing system while it is the actual value under an actual costing system
D) Factory overhead cost is estimated using a predetermined rate under a normal costing system, while it is me actual value under an actual costing system.

5. Grayson Inc. experienced the following costs per unit this year for one of the direct materials involved in producing its main product
3.1 pounds @ $4 20 per pound = $13.02 per finished unit
For the next year. Grayson expects to produce 7.400 finished units. The price per pound of the direct material is expected to rise 10%. To combat this increase. Grayson has adapted its manufacturing process to reduce the amount of the direct material needed per finished unit by 5% What is the direct materials budget for the next year?

A) $101,165
B) $91,531
C) $100,684
D) $105,983

Solutions: