*100 MCQs – US CMA Part 1 + ACCA FMA/F2 Foundation* ANSWERS PROVIDED AT THE END....

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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