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1. Which statement best describes the role of the management accountant?

Management accountants prepare the financial statements for an organization. Management accountants facilitate the decision-making process within an organization. Management accountants make the principal decisions within an organization. Management accountants are basically information collectors.

2. In a factory, when production is increased within the relevant range, what happens to the variable costs?

Variable costs will vary on a per unit basis. Variable costs will vary in total. Fixed costs will vary in total. Fixed and variable costs stay the same in total.

3. What is the main objective of budgetary control?

To define the goal of the firm. To coordinate different departments. To plan to achieve its goals. All of the above.

4. What is the term for a pricing method that uses two separate pricing strategies for transferring products between subunits?

Dual pricing. Functional pricing. Congruent pricing. Optimal pricing.

5. When are overhead variances recorded in a standard costing system?

When the goods are transferred out of work-in-progress. When the factory overhead is applied to work-in-progress. When the cost of goods sold is recorded. When the direct labor is recorded.

6. Which of the following factors does not affect the Learning Curve?

Method of Production. Labor Strike. Shutdown. Efficiency Rate.

7. ROI (Return on Investment) can be broken down into which of the following ratios?

Overall Turnover Ratio and Current Ratio. Net Profit Ratio and Fixed Assets Turnover. Working Capital Turnover Ratio and Net Profit Ratio. Net Profit Ratio and Overall Turnover Ratio.

8. Which of the following activities is not part of the dividend decision in financial management?

Identification of the profit after taxes. Measurement of the cost of funds. Deciding on the pay-out ratio. Considering the issue of bonus shares to equity shareholders.

9. Which of the following does not contribute to an increase in the Current Ratio?

Issue of Debentures to buy Stock. Issue of Debentures to pay Creditors. Sale of Investment to pay Creditors. Avail Bank Overdraft to buy Machine.

10. Which of the following statements is correct regarding financial ratios?

A higher Receivable Turnover is not desirable. Interest Coverage Ratio depends upon Tax Rate. An increase in Net Profit Ratio indicates an increase in Sales. A lower Debt-Equity Ratio signifies lower Financial Risk.

CMAFM Paper 2017

The Number of MCQs are limited as per ICMAI Past Paper in Syllabus 2016