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CIMA Fundamentals of management accounting Sample Questions:

1. Refer to the exhibit.

Data for October's budget for product Quest for the month of October are given below:
Each unit of Quest requires 6kg of raw materials. Strict quality control procedures are applied to the manufacturing process and normal rejection levels are 5% of finished units.
The raw materials purchases budget for the month of October is:

A) 2,129,400 kg
B) 2,136,000 kg
C) 2,134,737 kg
D) 2,130,600 kg

2. Refer to the exhibit.

SL manufactures a single product, the cost and selling price of which are given below:
Fixed overheads per unit are based on a budgeted production volume of 25,000 units.
Budgeted sales are assumed to be 25,000 units.
If all costs increase by 5% but selling price remains the same, by how much must sales change from the budgeted volume to achieve the same budgeted profit?

3. In a manufacturing company which produces a range of products, the cost of a royalty payment made to the product designer would be classified as A.

A) Administration expense
B) Selling and distribution expenses
C) Direct expense
D) Production overhead

4. In an integrated cost and financial accounting system, the accounting entries for charging gross direct wages to production would be:

A) Debit: Work in progress control accountCredit: Production overhead control account
B) Debit: Production overhead control accountCredit: Wages control account
C) Debit: Wages control accountCredit: Bank account
D) Debit: Work in progress control accountCredit: Wages control account

5. The possible returns and associated probabilities of two independent projects are as follows:

It has been decided that both projects are to be launched.
Which TWO of the following statements are correct? (Choose two.)

A) The expected value of the total return is $40,000 gain.
B) The probability of the total return being a loss is 0.10.
C) The expected value of the total return is $41,500 gain.
D) The probability of making a total return of exactly $5,000 gain is 0.02.
E) The probability of the total return being a gain is less than 1.00.

Solutions: