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CIMA Fundamentals of management accounting Sample Questions:

1. Variable costs can best be described as:

A) Costs that vary with a measure of activity
B) Costs that fluctuate widely
C) Uncontrollable costs
D) Costs that are not affected by changes in the level of activity

2. A management accountant has forecast the following cash inflows from four potential projects.

All four projects require the same initial investment and will last for four years. They all result in a positive net present value but only one of the projects can be undertaken.
Which project should be selected?

A) Project D
B) Project B
C) Project A
D) Project C

3. When compiling profit statement using a marginal costing system we must calculate the contribution. Once we have the contribution, we must deduct a specific amount to calculate the profit. Which of these values should we NOT deduct? (Select ALL that apply.)

A) Cost of goods sold
B) Fixed costs
C) Selling price

4. Which of the following is the LEAST appropriate basis on which to apportion the insurance costs of plant and machinery:

A) Machine hours
B) Net book value
C) Original cost
D) Replacement cost

5. When making a decision, for a cost or revenue to be classified as "relevant" it must be:
(a) Incremental
(b) Notional
(c) Cash
(d) Future

A) (a), (b) and (c) only
B) (b), (c) and (d) only
C) (a), (b) and (d) only
D) (a), (c) and (d) only

Solutions: