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| Section | Objectives |
|---|---|
| Cost-Volume-Profit Analysis | - Contribution and margin of safety - Break-even analysis |
| Standard Costing and Variance Analysis | - Interpretation of variances - Material, labor, and overhead variances |
| Introduction to Management Accounting | - Role and purpose of management accounting - Cost classification and cost behavior |
| Costing Techniques | - Absorption and marginal costing - Overhead allocation and absorption |
| Short-term Decision Making | - Relevant costing principles - Make or buy and limiting factors |
| Budgeting | - Budget preparation and purpose - Cash and functional budgets |
CIMA lists the following prerequisites for the CIMA Management Accounting: No formal prerequisites required for Certificate level entry..
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A company makes Product A and Product B. The production process for both products uses one type of material, one type of labour, and utilises one machine. All three of these resources will be limited in November. The company has performed a linear programming model and the constraints and optimal solution, to maximise contribution, are as follows:
Constraints:
For November, which of the above constraints are binding, and which are non-binding?
Correct Answer:
A manufacturing company uses activity-based costing to charge overheads to its three products. One of the main activities is quality inspection. The cost driver is the number of inspections and the budgeted cost is $211,200.
Additional budgeted data.
What is the budgeted quality inspection cost for a unit of product F?
Correct Answer: D 🗳️
Which of the following would lead to a favourable variance?
Correct Answer: B 🗳️
You are a trainee management accountant working for a prestigious manufacturing firm. One day you go to a business meeting a business meeting and the managing director is there. They stand up and say that the company is losing too much money through wastage and losses and so they have decided to implement a total quality management system. They go on to say this system will:
1:Allow the company to improve on a consistent and continual basis
2:Allow the company to identify and allocate quality accountability to certain departments
3:Help the company detect error and fraud
Are ALL of these statements correct?
Correct Answer: B 🗳️
Which of the following explain why standard costing is less appropriate in the contemporary business environment?
1. In a continuous improvement environment standard costing can restrict the impetus to remain as cost competitive as rivals.
2. Fixed overhead variances are less relevant as fixed costs represent a decreasing proportion of total manufacturing cost.
3. In a just-in-time environment there are fewer costs to control.
Correct Answer: A 🗳️
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