100 MCQs – US CMA Part 1 + ACCA FMA/F2 Foundation* ANSWERS PROVIDED AT THE END....
*Coverage*: Financial Reporting, Cost Accounting Basics, AIS, Business Acumen, Stakeholders, Cost Types
*Format*: 100 Qs + Answer Key with 1-line rationale. Use for practice. Target: 90 min.
*PART 1: FINANCIAL REPORTING BASICS – 25 Qs*
*Q1.* Which accounting principle requires expenses matched with revenues?
A. Consistency B. Matching C. Materiality D. Conservatism
*Q2.* Under US GAAP, inventory is valued at:
A. Cost only B. NRV only C. Lower of cost or NRV D. Lower of cost or market
*Q3.* Which is NOT a component of Equity?
A. Retained Earnings B. Common Stock C. Treasury Stock D. Bonds Payable
*Q4.* Depreciation is an example of:
A. Cash outflow B. Non-cash expense C. Revenue D. Liability
*Q5.* Issued Capital – Subscribed Capital = ?
A. Authorized capital B. Unissued capital C. Calls in arrears D. Paid-up capital
*Q6.* 10% Stock dividend when MV $20, Par $10. For 1,000 shares issued, RE debit = ?
A. $10,000 B. $20,000 C. $2,000 D. $1,000
*Q7.* Trading securities unrealized gain/loss goes to:
A. OCI B. I/S C. RE directly D. B/S only
*Q8.* ASC 606 Step 3 is:
A. Identify contract B. Identify PO C. Determine transaction price D. Allocate price
*Q9.* Finance lease criteria: Lease term = 80% of economic life. Classification?
A. Operating B. Finance C. Sales-type D. Short-term
*Q10.* Bad debt written off, later recovered. Entry:
A. Dr Cash, Cr Bad Debt Expense
B. Dr Cash, Cr Bad Debt Recovery
C. Dr A/R, Cr Allowance, then Dr Cash, Cr A/R
D. Both B and C acceptable
*Q11.* Purchase commitment loss recognized when:
A. Contract signed
B. MV < Contract price + loss probable
C. Goods received
D. Never
*Q12.* Entity Theory states:
A. Business = owner B. Assets = Equities C. Profit belongs to owner only D. No separate entity
*Q13.* Financial Capital Maintenance = profit if:
A. Physical units maintained B. Ending net assets > Beg net assets in $
C. Cash increased D. Sales increased
*Q14.* Which is current liability?
A. Bonds due 2029 B. Deferred tax liability C. Wages payable D. Lease liability >12mo
*Q15.* Warranty expense is recorded in period of:
A. Payment B. Sale C. Claim D. End of warranty
*Q16.* CFO Indirect method starts with:
A. Sales B. Net Income C. EBIT D. Gross Profit
*Q17.* Increase in A/R effect on CFO:
A. Add B. Subtract C. No effect D. Only if cash basis
*Q18.* Intercompany profit in ending inventory must be:
A. Ignored B. Eliminated C. Taxed D. Added to NCI
*Q19.* Annual Report primary users under IFRS Framework:
A. Tax authorities B. Existing & potential investors, lenders
C. Employees D. Government
*Q20.* Which is NOT qualitative characteristic?
A. Relevance B. Faithful representation C. Conservatism D. Comparability
*Q21.* Sum-of-years digits, life 4 yrs, Year 1 fraction = ?
A. 4/10 B. 1/4 C. 4/12 D. 1/10
*Q22.* DDB ignores salvage value until:
A. Never B. First year C. Last year D. Always
*Q23.* Excess tax provision last year adjusted by:
A. Dr Tax Expense, Cr Tax Payable
B. Dr Tax Payable, Cr RE prior period adj
C. Ignore D. Dr Tax Payable, Cr Tax Expense
*Q24.* HTM bond amortized cost increases when:
A. Discount bond B. Premium bond C. Market falls D. Sold
*Q25.* Stakeholder with no financial claim but interest:
A. Shareholder B. Creditor C. Community D. Bank
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*PART 2: COST ACCOUNTING BASICS & COST TYPES – 35 Qs*
*Q26.* Prime Cost =
A. DM + DL B. DL + MOH C. DM + MOH D. All costs
*Q27.* Conversion Cost =
A. DM + DL B. DL + MOH C. DM + MOH D. Period cost
*Q28.* Rent of factory building is:
A. Direct cost B. Period cost C. Product fixed OH D. Variable cost
*Q29.* Salary of CEO is:
A. Product cost B. Period cost C. Direct labor D. MOH
*Q30.* Cost that changes with activity but not proportionately:
A. Fixed B. Variable C. Mixed D. Step
*Q31.* Committed fixed cost example:
A. Advertising B. Depreciation C. Training D. Sales commission
*Q32.* Opportunity cost is:
A. Recorded in books B. Relevant for decision C. Sunk cost D. Always cash
*Q33.* Sunk cost is:
A. Future cost B. Relevant C. Irrelevant D. Avoidable
*Q34.* Absorption costing treats fixed OH as:
A. Period cost B. Product cost C. Expense D. Asset only
*Q35.* When production > sales, which NOI higher?
A. Variable B. Absorption C. Same D. Depends
*Q36.* High-low method weakness:
A. Too accurate B. Uses only 2 points C. Complex D. Needs regression
*Q37.* Normal capacity based on:
A. Max output B. Long-term average demand C. Current year D. Zero downtime
*Q38.* Under-applied OH means:
A. Actual < Applied B. Actual > Applied C. No variance D. Favorable
*Q39.* Job costing used for:
A. Oil refining B. Custom furniture C. Flour D. Chemicals
*Q40.* Process costing WIP equivalent units needed because:
A. No WIP B. Partially complete units C. Only FG D. Job order
*Q41.* Abnormal spoilage is:
A. Product cost B. Period loss C. Added to good units D. Ignored
*Q42.* Joint cost split-off point means:
A. Products identifiable B. Costs end C. Sales begin D. Separable costs start
*Q43.* By-product accounting method:
A. Allocate joint cost B. NRV reduces main product cost C. No entry D. Always material
*Q44.* Activity-based costing allocates OH using:
A. One rate B. Multiple cost drivers C. DL hours only D. Machine hours only
*Q45.* Cost pool is:
A. Single product B. Group of costs with same driver C. Direct cost D. Period cost
*Q46.* Unit-level activity:
A. Setup B. Drilling hole C. Product design D. Factory rent
*Q47.* Throughput =
A. SP – DM B. SP – VC C. SP – Total cost D. GP
*Q48.* Target costing: Price $100, Profit $20, Target cost = ?
A. $120 B. $80 C. $100 D. $20
*Q49.* Life-cycle cost includes:
A. Production only B. R&D to disposal C. Selling only D. Warranty only
*Q50.* Kaizen costing aims for:
A. One big cut B. Continuous small cuts C. Zero base D. Standard cost
*Q51.* Direct material is:
A. Always variable B. Can be fixed C. Period cost D. MOH
*Q52.* Indirect labor is part of:
A. DM B. DL C. MOH D. SG&A
*Q53.* Variable cost per unit:
A. Changes with volume B. Constant per unit C. Zero D. Changes total only
*Q54.* Fixed cost per unit:
A. Constant B. Decreases as volume ↑ C. Increases as volume ↑ D. Zero
*Q55.* Mixed cost example:
A. Rent B. DM C. Utility with base + usage D. Depreciation
*Q56.* Relevant range is:
A. 0 to infinity B. Activity where cost behavior valid C. Always 1 year D. Budget range
*Q57.* Controllable cost for dept manager:
A. Allocated HQ rent B. Dept supplies C. Depreciation D. Tax
*Q58.* Differential cost =
A. Sunk cost B. Future cost that differs between options
C. Historical cost D. Opportunity cost
*Q59.* Cost of quality – Prevention:
A. Inspection B. Training C. Rework D. Warranty
*Q60.* External failure cost:
A. Scrap B. Testing C. Customer returns D. Design review
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*PART 3: AIS & BUSINESS ACUMEN – 25 Qs*
*Q61.* AIS subsystem for payroll:
A. GL B. HRM C. Expenditure cycle D. Revenue cycle
*Q62.* Segregation of duties: Authorize, Record, Custody should be:
A. Same person B. Separate C. Two only D. Not important
*Q63.* Preventive control:
A. Bank rec B. Passwords C. Variance analysis D. Audit
*Q64.* Detective control:
A. Locks B. Reconciliation C. Training D. Approval
*Q65.* ERP benefit:
A. Data silos B. Real-time integration C. More manual work D. Less security
*Q66.* Database: Primary key is:
A. Duplicate allowed B. Unique identifier C. Foreign key D. Null allowed
*Q67.* XBRL used for:
A. Encryption B. Financial reporting tagging C. Payroll D. Firewall
*Q68.* Data analytics: “Why did sales drop?” is:
A. Descriptive B. Diagnostic C. Predictive D. Prescriptive
*Q69.* Blockchain key feature:
A. Centralized B. Immutable ledger C. Easy to change D. No security
*Q70.* SOX 404 requires mgmt to:
A. Outsource audit B. Assess ICFR C. Avoid controls D. Use cash basis
*Q71.* COSO cube does NOT include:
A. Objectives B. Components C. Org structure D. Tax rates
*Q72.* Risk appetite is:
A. Amount of risk to avoid all risk
B. Broad amount of risk entity accepts
C. Same as tolerance D. Not defined
*Q73.* Business acumen includes understanding:
A. Only accounting B. How business creates value C. Tax law only D. Audit only
*Q74.* Porter’s Five Forces: Supplier power high when:
A. Many suppliers B. Few substitutes C. Product not unique D. Low switching cost
*Q75.* SWOT: “Strong brand” is:
A. Strength B. Weakness C. Opportunity D. Threat
*Q76.* Value chain primary activity:
A. HR B. Procurement C. Operations D. Technology
*Q77.* Balanced Scorecard: “Employee training hours” =
A. Financial B. Customer C. Internal D. Learning & Growth
*Q78.* KPI should be:
A. SMART B. Vague C. Too many D. Not measurable
*Q79.* CSR stands for:
A. Corporate Sales Return B. Corporate Social Responsibility
C. Cost Saving Ratio D. Current Service Revenue
*Q80.* ESG: “E” includes:
A. Board diversity B. Carbon emissions C. Executive pay D. Audit fees
*Q81.* Stakeholder vs Shareholder: Stakeholder is:
A. Narrower B. Broader, includes non-owners C. Same D. Only employees
*Q82.* Triple bottom line:
A. Profit only B. People, Planet, Profit C. Assets, Liab, Equity D. Sales, GP, NP
*Q83.* Supply chain: Upstream =
A. Customers B. Suppliers C. Retailers D. Distributors
*Q84.* JIT inventory goal:
A. High stock B. Zero inventory C. EOQ D. Safety stock
*Q85.* EOQ minimizes:
A. Only ordering cost B. Only carrying cost C. Sum of ordering + carrying D. Stockout
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*PART 4: MIXED CONCEPTS CMA/ACCA – 15 Qs*
*Q86.* ACCA FMA: Prime cost + MOH = ?
A. Total cost B. Conversion cost C. Period cost D. Marginal cost
*Q87.* CMA: ROI can be improved by:
A. ↓Sales B. ↓Investment C. ↑Expenses D. ↓Margin
*Q88.* RI advantage over ROI:
A. % only B. Avoids rejecting projects > WACC C. Same D. No advantage
*Q89.* Master budget prepared first:
A. Cash B. Sales C. Production D. Capex
*Q90.* Flexible budget variance = Actual – Flexible. This is:
A. Volume variance B. Efficiency/price variance C. Sales variance D. Static variance
*Q91.* Capital vs Revenue expenditure: New roof extending life = ?
A. Revenue B. Capital C. Expense D. Liability
*Q92.* Accrual basis records:
A. Cash only B. When earned/incurred C. When paid D. Hybrid
*Q93.* Conservatism principle:
A. Overstate assets B. Anticipate losses, not gains
C. Always use high estimates D. Ignore losses
*Q94.* Materiality depends on:
A. Size & nature B. Always 5% C. Auditor only D. Fixed $
*Q95.* Cost object is:
A. Anything cost is measured for B. Cost driver C. Cost pool D. Allocation base
*Q96.* Stewardship means mgmt is responsible for:
A. Profit only B. Resources entrusted by owners
C. Tax D. Sales
*Q97.* Which report shows financial position at a point?
A. I/S B. B/S C. CFS D. SOCIE
*Q98.* Which report shows performance over period?
A. B/S B. I/S C. Statement of FP D. Notes
*Q99.* Management accounting focus:
A. Past, external B. Future, internal C. Tax D. Audit
*Q100.* Code of Ethics: Objectivity means:
A. Bias ok B. No conflict of interest influence C. Always agree with boss D. Ignore facts
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*ANSWER KEY*
*Part 1*: 1-B, 2-C, 3-D, 4-B, 5-B, 6-B, 7-B, 8-C, 9-B, 10-D, 11-B, 12-B, 13-B, 14-C, 15-B, 16-B, 17-B, 18-B, 19-B, 20-C, 21-A, 22-C, 23-D, 24-A, 25-C
*Part 2*: 26-A, 27-B, 28-C, 29-B, 30-C, 31-B, 32-B, 33-C, 34-B, 35-B, 36-B, 37-B, 38-B, 39-B, 40-B, 41-B, 42-A, 43-B, 44-B, 45-B, 46-B, 47-A, 48-B, 49-B, 50-B, 51-A, 52-C, 53-B, 54-B, 55-C, 56-B, 57-B, 58-B, 59-B, 60-C
*Part 3*: 61-C, 62-B, 63-B, 64-B, 65-B, 66-B, 67-B, 68-B, 69-B, 70-B, 71-D, 72-B, 73-B, 74-B, 75-A, 76-C, 77-D, 78-A, 79-B, 80-B, 81-B, 82-B, 83-B, 84-B, 85-C
*Part 4*: 86-A, 87-B, 88-B, 89-B, 90-B, 91-B, 92-B, 93-B, 94-A, 95-A, 96-B, 97-B, 98-B, 99-B, 100-B
*Key Rationale Snippets*:
*Q3*: Bonds Payable = Liability, not Equity.
*Q6*: Small stock dividend: 1,000×10%×$20 = $2,000, but RE debited at MV = $20k.
*Q23*: Immaterial correction goes to current tax expense.
*Q35*: Production > Sales → Absorption defers FC in inventory → Absorption NOI > Variable.
*Q38*: Applied 9.5k×20=190k vs Actual 198k = 8k Under.
*Q87*: ROI = Margin × Turnover. ↓Investment ↑Turnover ↑ROI.
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*How to Use This Mock*:
1. *Score*: 80+ = strong, 65-79 = review weak sections, <65 = redo concepts.
2. *CMA Weight*: Part 1 exam is 100 MCQs + 2 essays. This mirrors Section A-F coverage.
3. *ACCA FMA*: Q1-Q60 map directly to MA/F2 syllabus.
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