Detailed Exam Domain Coverage

Part 1: Financial Planning, Performance, and Analytics (50%)

External financial reporting decisions (15%)
Planning, budgeting, and forecasting (20%)
Performance management (20%)
Cost management (15%)
Internal controls (15%)

Part 2: Strategic Financial Management (50%)

Financial statement analysis (20%)
Corporate finance (20%)
Business decision analysis (25%)
Enterprise risk management (10%)
Professional ethics (15%)

Course Description

Preparing for the Certified Management Accountant (CMA) exam takes serious dedication, and navigating the vast amount of material can feel overwhelming. I put together these practice tests to give you a realistic, comprehensive testing environment that mirrors the actual CMA exam. Passing this certification requires more than just memorizing formulas; it requires a deep understanding of management accounting, strategic financial management, and complex business decision-making.

I designed these mock exams to expose your weak spots before test day. By working through these questions, you will get hands-on experience with the specific phrasing and difficulty level of the real exam. Rather than just giving you a score, I have provided an in-depth explanation for every single question. You will learn exactly why the correct answer is right and, equally importantly, the logical traps that make the incorrect options wrong. This bank covers everything from external financial reporting and budgeting to corporate finance and enterprise risk management. If you are looking for a practical, challenging resource to validate your study efforts, this is exactly what you need.

Sample Practice Questions Preview

Question 1 A manufacturing company produces a specific widget requiring 3 standard labor hours per unit at a standard rate of $15 per hour. During the last quarter, the company produced 1,000 units using 3,200 actual labor hours at a total actual labor cost of $49,600. What is the direct labor efficiency variance for this period?

A) $3,000 Favorable B) $3,000 Unfavorable C) $1,600 Unfavorable D) $4,800 Unfavorable E) $1,600 Favorable F) $4,600 Unfavorable

Overall Explanation: The direct labor efficiency variance isolates the impact of the hours worked by keeping the wage rate constant at the standard rate. The formula is: (Actual Hours - Standard Hours Allowed) × Standard Rate. The standard hours allowed for 1,000 units is 3,000 hours (1,000 units × 3 hours/unit). The actual hours used were 3,200. Because actual hours exceeded standard hours, the variance is unfavorable. Calculation: (3,200 - 3,000) × $15 = 200 × $15 = $3,000.

Correct Answer: B
Option A is incorrect: The mathematical amount is $3,000, but it is an unfavorable variance because the company used more hours (3,200) than the standard allowed (3,000).
Option B is correct: It accurately calculates the efficiency variance using the standard rate of $15 multiplied by the 200 excess hours worked.
Option C is incorrect: This figure is calculated using an incorrect variance formula, likely confusing the rate variance with the efficiency variance.
Option D is incorrect: This calculation incorrectly uses actual rates or incorporates total cost differences rather than isolating the efficiency metric.
Option E is incorrect: This combines a calculation error with the wrong variance direction (favorable instead of unfavorable).
Option F is incorrect: This is the total direct labor variance ($49,600 actual cost - $45,000 standard cost = $4,600 unfavorable), not the isolated efficiency variance.

Question 2 Assuming a company currently has a current ratio greater than 1.0, which of the following corporate finance transactions will definitively increase its current ratio?

A) Purchasing new inventory on account. B) Collecting cash from an outstanding accounts receivable. C) Declaring a cash dividend to shareholders. D) Paying off a short-term accounts payable with cash. E) Borrowing cash via a six-month short-term bank loan. F) Purchasing heavy equipment with cash.

Overall Explanation: The current ratio is calculated as Current Assets divided by Current Liabilities. When the ratio is greater than 1.0, an equal decrease in both the numerator (Current Assets) and the denominator (Current Liabilities) will increase the overall ratio.

Correct Answer: D
Option A is incorrect: Purchasing inventory on account increases both current assets and current liabilities equally. When the starting ratio is > 1.0, adding an equal amount to both sides decreases the ratio.
Option B is incorrect: Collecting cash from accounts receivable increases cash (current asset) and decreases accounts receivable (current asset) by the exact same amount. The current ratio remains completely unchanged.
Option C is incorrect: Declaring a dividend increases current liabilities (dividends payable) without changing current assets, which decreases the current ratio.
Option D is correct: Paying an account payable with cash reduces both current assets (cash) and current liabilities (accounts payable) by the same amount. Since the initial ratio is > 1.0, this equal subtraction increases the overall ratio.
Option E is incorrect: Borrowing short-term cash increases both current assets and current liabilities equally, which decreases the ratio if it is currently above 1.0.
Option F is incorrect: Purchasing equipment (a long-term asset) with cash reduces current assets while leaving current liabilities unchanged, thereby decreasing the current ratio.

Question 3 According to the IMA Statement of Ethical Professional Practice, a management accountant who fails to disclose all relevant information that could reasonably be expected to influence an intended user's understanding of financial reports has violated which specific ethical standard?

A) Competence B) Confidentiality C) Integrity D) Credibility E) Objectivity F) Independence

Overall Explanation: The IMA Statement of Ethical Professional Practice consists of four overarching standards: Competence, Confidentiality, Integrity, and Credibility. The standard of Credibility specifically mandates that professionals communicate information fairly and objectively, and disclose all relevant information that could influence an intended user's understanding of the reports, analyses, or recommendations.

Correct Answer: D
Option A is incorrect: Competence refers to maintaining appropriate professional leadership, expertise, and performing duties in accordance with relevant laws and technical standards.
Option B is incorrect: Confidentiality involves keeping information private unless disclosure is authorized or legally required.
Option C is incorrect: Integrity focuses on mitigating conflicts of interest, refraining from conduct that prejudices duties, and avoiding actions that discredit the profession.
Option D is correct: Credibility strictly requires the fair and objective communication of information, including the disclosure of all data relevant to the user's understanding.
Option E is incorrect: While objectivity is an overarching ethical principle of the IMA framework, the specific standard detailing the disclosure of relevant information is Credibility.
Option F is incorrect: Independence is a core concept for external auditors (like CPAs) but is not explicitly named as one of the four core standards in the IMA Statement of Ethical Professional Practice.

Welcome to the Mock Exam Practice Tests Academy to help you prepare for your Certified Management Accountant Course.
You can retake the exams as many times as you want
This is a huge original question bank
You get support from me if you have questions
Each question has a detailed explanation
Mobile-compatible with the Udemy app

I hope that by now you're convinced! And there are a lot more questions inside the course.