IMANET IMANET-CMA Online Practice Questions and Exam Preparation

IMANET IMANET-CMA Online Questions & Answers

• Question 1111:

  Exhibit

  

  The variance of actual contribution margin from budgeted contribution margin attributable to sales price is?

  A. $115,000 unfaorable.
  B. $115,000 favorable
  C. S65. 000 favorable.
  D. $65,000 uravorebIe.
  D. $65,000 uravorebIe.

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  Explanation

  The budgeted prices of Xenox and Xeon were $6 and $10 per unit, respective. Actual sales in units multiplied by the budgeted prices equals total sales of $2,080,000, Because actual sales were on, p $2. 0 15,000. the variance of $65,000 is unfavorable (lower sales than budgeted).

• Question 1112:

  If a corp4ration holds a forward contract for the dear, of US. Trashy bonds son 6 months and, during those 6 months, interest rte dine. at the end f the 6 months U value vf me rowed cacti have

  A. Depressed
  B. Increased.
  C. Remained constant,
  D. Any of the answers may be correct, depending on the extent of the decline in interest rates.
  A. Depressed

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  Explanation

  Interest rate futures contracts airwave risk-free bonds, such as U.S. Treasury bonds When I interest rates decrease over the pentode a forward contract, the value of the bonds and the forward contract increase

• Question 1113:

  Book rate of return is an unsatisfactory guide to selecting capital projects because

  I. It uses accrual accounting numbers

  II. It compares a single project against the average of capital rejects.

  III.

  It uses cash flows to gauge the desirability of the project.

  A. l only.
  B. l and ll.
  C. Ill only.
  I. II, and Ill.
  B. l and ll.

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  Explanation

  A common misstep in regard to capital budgeting is the temptation to gauge the desirability of a project by using accrual accounting numbers instead of cash flows. Net income and book value are affected by the compas choices of accounting methods. A project's true rate of return cannot be dependent on bookkeeping decisions. Another distortion inherent in comparing a single project's book rate of return to the current one for the company as a whole is that the latter is an average of all of a firm's capital projects. Embedded in that average number `may be a hand Full of good projects melding up for a large number of poor investments.

• Question 1114:

  The term that refers to costs incurred in the past that are not relevant to a future decision is

  A. Discretionary cost.
  B. Pull absorption cost.
  C. Under allocated indirect cost.
  D. Sunk cost.
  D. Sunk cost.

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  Explanation

  A sunk cost cannot be avoided because it represents an expenditure that has already been made or an irrevocable decision to incur the cost.

• Question 1115:

  The attribute of the product mix that equals the number of variants of each product is

  A. Length
  B. Depth
  C. Width
  D. Consistency
  B. Depth

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  Explanation

  The product mix is the product assortment. Analysis of the attributes of the mix helps the firm top determine its marketing strategy and make decisions about its product lines. The following are the attributes: (1) width is the number of product lines; (2) length equals the total items in the mix; (3) depth equals the variants (e.g., flavors of ice cream) of each product, and (4) consistency is the degree of the relationship of the product lines.

• Question 1116:

  Which necessary approach to marketing control is the responsibility of senior and middle management and is directed toward achievement of planned objectives?

  A. Annual-plan control
  B. Profitability control
  C. Efficiency control
  D. Strategic control
  A. Annual-plan control

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  Explanation

  Annual-plan control should be overseen by senior and middle management. It is supplied at all levels of the firm using management-by-objective (MBO) methods. Annual plan control is directed toward reaching sales, profitability, and other objective defined in the annual plan. Interim-period objectives are set, performance is monitored, the causes of variances are identified, and corrective action is taken.

• Question 1117:

  The most direct way to prepare a cash budget for a manufacturing firm into include

  A. Projected sales, credit terms, and net income.
  B. Projected net income, depreciation, and goodwill amortization.
  C. Projected purchases, percentages of purchases paid, and net income.
  D. Projected sales and purchases, percentages of collections, and terms of payments.
  D. Projected sales and purchases, percentages of collections, and terms of payments.

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  Explanation

  The most direct way of preparing a cash budget requires incorporation of sales projections and credit terms, collection percentages, estimated purchases and payment terms, and other cash receipts and disbursements. In other words, preparation of the cash budget requires consideration of both inflows and outflows.

• Question 1118:

  Which of the following pricing policies results in setting freight charges to customers at the actual average freight cost?

  A. Freight absorption pricing.
  B. Uniform delivered pricing.
  C. Zone pacing.
  D. FOB-noggin pacing
  B. Uniform delivered pricing.

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  Explanation

  In uniform delivered pricing, the firm charges the same price, inclusive of shipping costs, to all customers regardless of their location. This price is the firm's average actual freight cost. Thus, both nearby and distant customers are charged the same amount. This policy is easy to administer, permits the firm to advertise one price nationwide, and facilitates marketing to faraway customers.

• Question 1119:

  CyberAge Outlet, a relatively new store, is a cafe that offers customers the opportunity to browse the Internet or play computer games at their tables while they drink coffee. The customer pays a fee based on the amount of time spent signed on to the computer. The store also sells books, tee-shirts, and computer accessories. CyberAge has been pang all of its bills on the last day of the payment period, thus forfeiting all supplier discounts. Shown below are data on CyberAges two major vendors, including average monthly purchases and credit terms.

  

  If Morton fails to take the discount and pays on the 40th day, what effective rate of annual interest is it paying the vendor?

  A. 2%
  B. 24%
  C. 24. 49%
  D. 36. 73%
  C. 24. 49%

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  Explanation

• Question 1120:

  An organized network of intermediates that perform all the functions required to hnk producers with end customers is a

  A. Mufti-level direct marketing channel.
  B. Marketing path.
  C. Marketing channel
  D. Distribution logistics system.
  C. Marketing channel

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  Explanation

  A distribution channel (marketing channel) is an organized network of agencies and institutions (intermediaries) that in combination perform all the functions required to link producers with end customers to accomplish the marketing task. It may be a sales1 delivery, or service channel.