CMA ima questions part 1
CMA Part 1 – Financial Planning, Performance, & Control
Examination Practice Questions
© Copyright 2013 Institute of Certified Management Accountants
CMA Part 1 – Financial Planning, Performance and Control
Examination Practice Questions
1. A company is preparing the sales budget for two potential products. Both products require the use of the same manufacturing equipment, which is only available for 60 hours each month. The contribution margin of product A is $95 per unit and the contribution margin of product B is $55 per unit. Product A requires 4 hours of machine time per unit and product B requires 2.5 hours per unit. In order to efficiently allocate the equipment resources, the company should manufacture
a.
b.
c.
d.
product A, because the contribution margin is more per unit than product B. product B, because they can produce more units of that product than product A. product A, because it will make better use of the equipment than product B. product B, because they can produce many units and still save hours for product A.
2. Granger Company is reviewing its standard machine hours per unit to use in its budget for the upcoming year. The machine manufacturer’s specifications indicated a unit could be made in 0.75 hours, and a benchmarking study showed a competitor produced at a speed of 0.78 machine hours per unit. Granger’s actual results from last year averaged 0.83 machine hours per unit even though a standard of 0.80 machine hours per unit had been established using engineering studies. The standard Granger should use in its upcoming budget is
a.
b.
c.
d.
0.75 machine hours per unit.
0.78 machine hours per unit.
0.80 machine hours per unit.
0.83 machine hours per unit.
© Copyright 2013 Institute of Certified Management Accountants
3. While gathering information to use in preparing the annual budget, a company identifies cost drivers associated with manufacturing costs. Which one of the following is a quantitative analysis method the company can
Examination Practice Questions
© Copyright 2013 Institute of Certified Management Accountants
CMA Part 1 – Financial Planning, Performance and Control
Examination Practice Questions
1. A company is preparing the sales budget for two potential products. Both products require the use of the same manufacturing equipment, which is only available for 60 hours each month. The contribution margin of product A is $95 per unit and the contribution margin of product B is $55 per unit. Product A requires 4 hours of machine time per unit and product B requires 2.5 hours per unit. In order to efficiently allocate the equipment resources, the company should manufacture
a.
b.
c.
d.
product A, because the contribution margin is more per unit than product B. product B, because they can produce more units of that product than product A. product A, because it will make better use of the equipment than product B. product B, because they can produce many units and still save hours for product A.
2. Granger Company is reviewing its standard machine hours per unit to use in its budget for the upcoming year. The machine manufacturer’s specifications indicated a unit could be made in 0.75 hours, and a benchmarking study showed a competitor produced at a speed of 0.78 machine hours per unit. Granger’s actual results from last year averaged 0.83 machine hours per unit even though a standard of 0.80 machine hours per unit had been established using engineering studies. The standard Granger should use in its upcoming budget is
a.
b.
c.
d.
0.75 machine hours per unit.
0.78 machine hours per unit.
0.80 machine hours per unit.
0.83 machine hours per unit.
© Copyright 2013 Institute of Certified Management Accountants
3. While gathering information to use in preparing the annual budget, a company identifies cost drivers associated with manufacturing costs. Which one of the following is a quantitative analysis method the company can