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CIMA Fundamentals of management accounting Sample Questions:

1. Which of the following is a valid definition of a cash budget?

A) A detailed budget of estimated cash outflows only, incorporating both depreciation and capital expenditure.
B) A detailed budget of estimated cash inflows and outflows incorporating both revenue and capital items.
C) A detailed budget of estimated cash inflows only, incorporating receipts from cash sales as well as from credit customers.
D) A detailed budget of estimated cash inflows and outflows incorporating revenue items only.

2. A manufacturing company has four production departments. Overheads have been apportioned between them as follows:

It takes each department 4 hours, 4 hours, 2 hours and 3 hours respectively to produce the company's only product. The company recovers costs on the basis of labour hours. They plan to produce 6,000 units What will the overhead absorption rate per unit be in £'s?
Select the correct answer from the choices below

A) £7.90
B) £7JO
C) £7.50
D) £8.00

3. The managing director of a small expanding company has made a number of statements about CIMA's role in relation to its members and to worldwide organizations.
Which ONE of the following statements is NOT correct?

A) CIMA's continuing professional development scheme is applicable to all members
B) CIMA is a member of IFAC (International Federation of Accountants)
C) CIMA provides its members and students with ethical guidance
D) CIMA's members work primarily in the private sector

4. In a manufacturing company which produces a range of products, the production manager's salary would be classified as A.

A) Direct expense
B) Direct labour cost
C) Indirect expense
D) Indirect labour cost

5. Which TWO of the following are characteristics of Management Accounts? (Choose two.)

A) Provide information needed by shareholders
B) Provide information to managers
C) Statutory requirement
D) Governed by rules and regulations
E) Internally focused

Solutions: