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

1. Faxton and Rexford are competitor in the same industry Faxton utilizes an incentive program mat focuses solely on net income Rexford uses customer service and employee development in addition to net income in its incentive program. Over time. Faxton can be expected to

A) be less likely to misstate earnings due to the importance of earnings to management
B) have higher sales growth than Rexford due to management s strong focus
C) be more profitable than Rexford initially Put lose this advantage
D) consistently be more profitable than Rexford due to not funding training programs


2. A company has prepared the following pro forma income statements. It plans to sell 10,000 units in the current year and 11.500 units next year.

A) Reduce operating expenses by $1.00 per unit
B) Reduce cost of goods sold by $1.00 per unit
C) Increase sales revenue by 15%.
D) Increase gross profit margin by 15%


3. Huaxia Manufacturing's standard cost card for product GH1 includes the following:

During the month of June, Huaxia produced 12,300 units. The purchasing department purchased 30,400 yards of fabric for a total cost of $100,320. The production department used 25.300 yards of fabric in June. What is Huaxia's direct materials price variance for the month of June?

A) $14,220 unfavorable
B) $2,450 unfavorable
C) $6,080 favorable
D) $11,770 unfavorable


4. 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) Management has decided not to maintain a hot site because it was determined that the costs outweigh the benefits.
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) The details of the disaster recovery plan stipulate that internal audit should review the plan every other year rather than annually.


5. One major output of an accounting information system's financing cycle is a summary of

A) actual operating cash outflows
B) forecasted cash needs
C) current cash balances.
D) actual operating cash inflows


Solutions:

Question # 1
Answer: A
Question # 2
Answer: B
Question # 3
Answer: C
Question # 4
Answer: B
Question # 5
Answer: B

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