To provide candidates with a brief view of some of the types of questions on the CMA^® (Certified Management Accountant) exam, the following are five questions – with correct answers and explanations for each. 

You can also check out these additional practice multiple-choice and essay questions (in PDF format) and try the new interactive practice quiz, available on the IMA^® (Institute of Management Accountants) website, to test your skills and expertise.

CMA Exam Part 1:

1. The management of a food processing company is analyzing its internal strengths and weaknesses as part of its strategic planning process. Which one of the following is most likely to be considered a strategic internal variable for the company?

a. Changes in the legal code for food processors.
b. The economic forces that regulate the local labor supply.
c. Technological changes in food-processing methods.
d. The culture at the company’s food processing plant.

Correct answer d.
Internal environmental variables for a company include a company’s culture, structure, and resources. External environmental factors include economic forces, political-legal forces, technological forces, and sociocultural forces. 

2. A company is headquartered in the U.S. and has international subsidiaries in several countries. One of the company’s international subsidiaries created several off-the-book accounts to pay bribes to foreign officials, and these payments were not properly reflected in the subsidiary’s books and records. The subsidiary has certain internal controls in place but does not utilize the COSO internal controls framework and does not have a compliance program in place. Based on the information presented, all of the following are violations by the subsidiary under the internal control provisions of the U.S. Foreign Corrupt Practices Act except the

a. use of bribery payments.
b. failure to use the COSO framework for internal controls.
c. failure to have internal controls to ensure that transactions were appropriately recorded.
d. lack of a compliance program as part of its system of internal controls.

Correct answer b.
The FCPA has several internal control provisions but does not stipulate the use of the COSO framework. Other frameworks are permissible as long as they encompass the components of a control environment, risk assessment, information and communication procedures, monitoring activities, and control policies and procedures.

3. A hotel chain allows its customers to sign up for its loyalty program online. Management discovered that many customers misspelled their mailing addresses when inputting their personal information. The company revised the online form so that the customer can only select from a list of cities and streets instead of typing in their own addresses. This measure is an example of managing the data’s

a. availability.
b. integrity.
c. usability.
d. security.

Correct answer b. 
It is an example of managing the data’s integrity through input control.

CMA Exam Part 2:

4. The yield curve shows the relationship between bond yields that differ by the
   
a. credit risk of the issuer of the bonds.
b. dividend yield of the issuer of the bonds.
c. par value of the bonds.
d. years to maturity of the bonds.

Correct answer d.
The yield curve plots yield vs. bond maturity.

5. In order to avoid pitfalls in relevant-cost analysis, management should focus on

a. variable cost items that differ for each alternative.
b. long-run fixed costs of each alternative.
c. anticipated fixed costs and variable costs of all alternatives.
d. anticipated revenues and costs that differ for each alternative.

Correct answer d.
Relevant costs and relevant revenues are those costs and revenues expected in the future that differ among alternative courses of action being considered. These are the items that affect decision making.