العربية

CMA Part 1

CMA Part 1: Financial Planning, Performance, and Analytics: free practice test

Start with 10 free questions to see what needs more practice. Finish to see your score, weakest units and every option explained.

360 on the 0–500 scaled score This is your practice accuracy. It cannot be converted to the exam’s scaled score or used to determine whether you pass.

Back to CMA Part 1: Financial Planning, Performance, and Analytics

Practice test questions with answers and explanations

Try the questions in the test above first, then open each one here to see the correct answer and why every other option is wrong.

01A company reports under US GAAP. Amounts in USD thousands are: net income 160; depreciation expense 25; increase in trade receivables 18; decrease in inventory 12; decrease in trade payables 9. These are the only reconciliation items. What is net cash provided by operating activities under the indirect method?

Practice question Unit: External Financial Reporting Decisions

  1. A$170,000 ✓ Correct answer

    160 + 25 − 18 + 12 − 9 = $170,000; deduct increased receivables and decreased payables, and add decreased inventory and depreciation. Basis: SEC Beginners’ Guide to Financial Statements, Cash Flow Statements: reconcile net income for noncash items and operating assets/liabilities.

  2. B$206,000

    206 = 160 + 25 + 18 + 12 − 9; this reverses only the receivables-increase sign, which should be deducted.

  3. C$146,000

    146 = 160 + 25 − 18 − 12 − 9; this deducts the inventory decrease instead of adding it.

  4. D$188,000

    188 = 160 + 25 − 18 + 12 + 9; this adds the payables decrease instead of deducting it.

Reference: SEC Beginners’ Guide to Financial Statements, Cash Flow Statements: reconcile net income for noncash items and operating assets/liabilities — https://www.sec.gov/about/reports-publications/beginners-guide-financial-statements

02A company using the allowance method begins the year with a USD 18,000 credit balance in its credit-loss allowance. During the year it writes off USD 22,000 of receivables and reinstates and collects USD 4,000 previously written off. Its year-end credit-loss estimate requires a USD 15,000 credit allowance balance. With no other movements, what credit-loss expense is required?

Practice question Unit: External Financial Reporting Decisions

  1. A$15,000 ✓ Correct answer

    Write-offs debit the allowance and reinstatement credits it: 18,000 − 22,000 + 4,000 = 0 before adjustment. A USD 15,000 expense restores the required credit balance. Basis: FFIEC 031/041 Glossary (September 2026), Allowances for Credit Losses: Changes in the ACL.

  2. B$11,000

    USD 11,000 subtracts the USD 4,000 recovery from the required ending balance again, even though reinstatement is already included in the roll-forward.

  3. C$19,000

    USD 19,000 = 15,000 − (18,000 − 22,000). This omits the USD 4,000 credit for reinstatement.

  4. D$37,000

    USD 37,000 adds write-offs to the ending target but ignores the beginning credit balance and reinstatement credit.

Reference: FFIEC 031/041 Glossary (September 2026), Allowances for Credit Losses: Changes in the ACL — https://www.fdic.gov/bank-financial-reports/031-041-926gloss-9-30-2026-final.pdf

03Ruwad Service Centre budgets fixed monthly rent of USD 30,000 and variable cost of USD 4 per transaction. The static budget assumed 5,000 transactions. Actual volume was 6,000 transactions, within capacity, and actual total cost was USD 55,500. What are the flexible-budget cost and the flexible-budget cost variance?

Practice question Unit: Planning, Budgeting, and Forecasting

  1. AUSD 50,000; variance USD 5,500 unfavourable

    50,000 is the static budget; it is not flexed to 6,000 transactions.

  2. BUSD 60,000; variance USD 4,500 favourable

    This treats rent as variable at 6 per transaction.

  3. CUSD 54,000; variance USD 1,500 unfavourable ✓ Correct answer

    30,000 + 6,000 × 4 = 54,000; actual 55,500 is 1,500 higher. Basis: IMA CMA LOS, Part 1 B.4 and C.1: flexible budgets and flexible-budget variances.

  4. DUSD 24,000; variance USD 31,500 unfavourable

    This leaves out the fixed rent.

Reference: IMA CMA LOS, Part 1 B.4 and C.1: flexible budgets and flexible-budget variances — https://www.imaglobal.org/assets/static/cma-learning-outcome-statements-2024.HDHHOjUF.937f1af111.pdf

04A manufacturer budgets labor for a new product using a 90% cumulative-average-time learning curve. The first unit takes 100 hours, and learning continues through the eighth unit. How many labor hours are required for units 5 through 8 combined? Do not round intermediate amounts.

Practice question Unit: Planning, Budgeting, and Forecasting

  1. A291.60 hours

    The average for the first eight units is 72.9 hours. Multiplying it by four gives 291.60, but that average includes the slower first four units; it is not the average for units 5–8.

  2. B583.20 hours

    583.20 = 8 × 100 × 0.9³ is cumulative time for all eight units, not the additional four-unit lot.

  3. C324 hours

    324 = 4 × 100 × 0.9² is cumulative time for units 1–4, to be subtracted from the eight-unit total.

  4. D259.20 hours ✓ Correct answer

    At four units, cumulative average time is 81 hours, so total time is 324. At eight it is 72.9 hours, giving 583.2. The additional lot takes 583.2 − 324 = 259.2 hours. Basis: IMA Glossary: Cumulative Average-Time Learning Model.

Reference: IMA Glossary: Cumulative Average-Time Learning Model — https://imamiddleeast.org/wp-content/uploads/2020/04/CMA-ENGAR-Glossary.pdf

05Fakhar Ceramics purchased 18,000 kg of clay and used 16,500 kg in November. The standard price is USD 4.50 per kg, and the purchase-price variance recognized at purchase is USD 3,600 favorable. A USD 900 freight charge is recorded separately in overhead and excluded from this variance. What was the actual purchase price per kg?

Practice question Unit: Performance Management

  1. AUSD 4.70

    USD 4.70 adds the favorable USD 0.20 variance per kg to standard price. A favorable purchase-price variance means actual price is lower, not higher.

  2. BUSD 4.28

    USD 4.28 approximates 4.50 − 3,600/16,500. It uses quantity consumed rather than the stated purchase-quantity basis.

  3. CUSD 4.30 ✓ Correct answer

    Favorable price variance = (standard price − actual price) × purchased quantity. Actual price = 4.50 − 3,600/18,000 = USD 4.30. Freight is excluded by the facts. Basis: IMA CMA LOS, Part 1 C.1: direct-material price variances.

  4. DUSD 4.35

    USD 4.35 adds USD 900/18,000 = USD 0.05 freight per kg to the USD 4.30 purchase price, contrary to the specified treatment.

Reference: IMA CMA LOS, Part 1 C.1: direct-material price variances — https://www.imaglobal.org/assets/static/cma-learning-outcome-statements-2024.HDHHOjUF.937f1af111.pdf

06Najd Supplies analyses two customers for the year (USD thousand). Customer X: revenue 900, cost of goods sold 630, 120 orders, 2 sales visits, no rush deliveries. Customer Y: revenue 900, cost of goods sold 630, 1,500 orders, 24 sales visits, 300 rush deliveries. Activity rates: order processing 0.08 per order, sales visit 2.5 per visit, rush delivery 0.2 per delivery. Which conclusion is best?

Practice question Unit: Performance Management

  1. AX and Y are equally profitable, because their gross margins are equal

    Both gross margins are USD 270,000, but cost-to-serve differs. X incurs USD 14,600 of service cost and Y USD 240,000, so equal gross margins do not imply equal customer profitability.

  2. BY earns USD 90,000 once rush delivery is treated as a company-level cost

    Y's rush deliveries cause USD 60,000 of activity cost. Excluding that traceable cost overstates Y's profit by USD 60,000, producing 90,000 instead of 30,000.

  3. CY earns USD 30,000 after service costs; review pricing or redesign its service ✓ Correct answer

    In USD thousands, Y's margin is 900 − 630 − (1,500 × 0.08) − (24 × 2.5) − (300 × 0.2) = 30. X earns 270 − 9.6 − 5 = 255.4. Review Y's price or service pattern before deciding whether to discontinue it. Basis: IMA CMA LOS, Part 1 C.3.b–d: customer profitability and controllable margin.

  4. DDrop Y, as its USD 240,000 of service costs exceeds X's

    Higher service costs alone do not justify dropping Y. The decision also depends on avoidable costs, lost revenue and alternative uses of capacity; the reported customer margin remains positive.

Reference: IMA CMA LOS, Part 1 C.3.b–d: customer profitability and controllable margin — https://www.imaglobal.org/assets/static/cma-learning-outcome-statements-2024.HDHHOjUF.937f1af111.pdf

07A workshop's equipment contract charges USD 2,400 monthly plus USD 1.80 per machine-hour for the first 3,000 hours. Each additional hour costs USD 2.50. The workshop plans 3,400 hours and a separate one-time tool calibration costing USD 500. What is the budgeted equipment-contract cost, excluding calibration?

Practice question Unit: Cost Management

  1. AUSD 8,520

    Applies 1.80 to all 3,400 hours and ignores the higher tier.

  2. BUSD 8,800 ✓ Correct answer

    2,400 + 3,000×1.80 + 400×2.50 = 8,800; calibration is excluded as asked. Basis: IMA Glossary: Mixed Cost; Variable Cost; Relevant Range.

  3. CUSD 9,300

    Incorrectly adds the one-time calibration into the flexible equipment cost.

  4. DUSD 6,120

    USD 6,120 = 3,400 × 1.80. It omits the USD 2,400 fixed fee and charges the lower rate on the 400 hours in the higher tier.

Reference: IMA Glossary: Mixed Cost; Variable Cost; Relevant Range — https://imamiddleeast.org/wp-content/uploads/2020/04/CMA-ENGAR-Glossary.pdf

08Rafidain Coffee competes on price. Its value chain analysis compares costs per kg with the main rival (Rafidain vs rival, USD): roasting 1.10 vs 0.95; packaging 0.60 vs 0.45; distribution 0.80 vs 0.50, because Rafidain runs its own trucks at 55% utilisation; marketing 0.40 vs 0.70. Which activity should management investigate first to address its largest unit-cost disadvantage?

Practice question Unit: Cost Management

  1. ACut roasting first, as the largest cost at USD 1.10 per kg

    The largest cost is not the largest disadvantage; roasting's gap is 0.15.

  2. BRaise marketing to the rival's USD 0.70 to support volume

    Marketing is already an advantage of USD 0.30; matching the rival adds cost.

  3. CTreat packaging as the main gap, at USD 0.15 per kg

    Packaging's gap ties with roasting and is half the distribution gap.

  4. DFix distribution first, the largest gap at USD 0.30 a kg ✓ Correct answer

    Value chain analysis targets the activity with the biggest cost disadvantage: 0.80 − 0.50 = 0.30, driven by low truck utilisation. Basis: HBS Institute for Strategy and Competitiveness: The Value Chain.

Reference: HBS Institute for Strategy and Competitiveness: The Value Chain — https://www.isc.hbs.edu/strategy/business-strategy/Pages/the-value-chain.aspx

09Internal audit is testing the three-way match of purchase orders, receiving reports and invoices for Q3 payments above SAR 10,000. The control requires the reviewer to retain a dated sign-off. Which procedure provides the strongest evidence of operating effectiveness over the quarter?

Practice question Unit: Internal Controls

  1. AInspect the purchasing policy and trace its requirements to the procedure manual

    The policy and manual show the control's design, not that reviewers actually matched documents before Q3 payments.

  2. BObserve an AP clerk matching documents during one morning's payment run

    Observation supports evidence of operation at the observed time, but a single morning does not cover operation throughout the quarter.

  3. CAsk the AP supervisor to describe the matching and exception-review process

    Inquiry explains the process but alone does not provide sufficient evidence of effective operation.

  4. DInspect sign-offs and reperform the match for payments sampled across Q3 ✓ Correct answer

    Dated sign-offs address whether the control was performed; reperformance checks its accuracy. Sampling across Q3 covers the period better than a single observation. Basis: PCAOB AS 2201.44–.52, especially .50: tests of controls.

Reference: PCAOB AS 2201.44–.52, especially .50: tests of controls — https://pcaobus.org/oversight/standards/auditing-standards/details/AS2201

10Jood Trading compares three cloud offers for payroll. Offer X: rent virtual machines and install its own payroll software. Offer Y: build its own payroll application on a provider-managed platform. Offer Z: use the provider's payroll application through a browser, with the provider running the infrastructure and the application. Each contract leaves user administration and data ownership with Jood. Under NIST SP 800-145, how is Offer Z classified, and what stays with Jood?

Practice question Unit: Technology and Analytics

  1. APaaS; Jood maintains the application code

    PaaS is the provider-managed platform on which the customer deploys its own application, as in Offer Y. Offer Z uses the provider's application.

  2. BIaaS; Jood patches the operating systems

    IaaS supplies computing infrastructure while the customer manages operating systems and applications, as in Offer X, not Z.

  3. CSaaS; the provider decides who may access Jood's data

    SaaS is correct, but the contract leaves user administration with Jood rather than transferring access decisions to the provider.

  4. DSaaS; Jood still manages user access and its data ✓ Correct answer

    NIST defines SaaS as using the provider's applications over a network without managing underlying infrastructure. The stated contract separately leaves access administration and data ownership with Jood. Basis: NIST SP 800-145, p. 2: Software as a Service.

Reference: NIST SP 800-145, p. 2: Software as a Service — https://csrc.nist.gov/pubs/sp/800/145/final

Keep preparing for CMA Part 1: Financial Planning, Performance, and Analytics

See also: Accounting & Tax Exams