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Exam Code: BA2
Exam Name: Fundamentals of management accounting
Updated: Jul 26, 2026
Q & A: 392 Questions and Answers
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| Section | Objectives |
|---|---|
| Topic 1: Cost Accounting Fundamentals | - Introduction to management accounting - Role and purpose of cost accounting |
| Topic 2: Costing Methods | - Overhead allocation and absorption costing - Job costing and batch costing - Process costing basics |
| Topic 3: Cost Classification and Behaviour | - Cost behaviour patterns and analysis - Fixed, variable, and semi-variable costs |
| Topic 4: Budgeting and Planning | - Basic forecasting techniques - Introduction to budgeting |
1. The Chartered Institute of Management Accounting's definition of management accounting outlines four responsibilities of the accountant in terms of the value for the stakeholders. The management accountant should aim to have which of the following effects according to CIMA?
A) Damage value for the stakeholder
B) Create value for the stakeholder
C) Increase value for the stakeholder
D) Decrease value for the stakeholder
E) Preserve value for the stakeholder
F) Protect value for the stakeholder
2. Within the relevant range, a variable cost is a cost which:
A) varies in total in proportion to the level of activity.
B) cannot be forecast with any degree of accuracy because of its variability.
C) varies in total in proportion to the level of inflation.
D) varies per unit in proportion to the level of activity.
3. Which of the following is the correct definition is an annuity:
A) A set of regular payments of increasing value.
B) A chain of regular cash flows up to a certain period of time.
C) A series of cash outflows which goes on forever.
4. Which of the following is NOT a characteristic of useful operational level information?
A) Sufficiently accurate.
B) Governed by financial reporting standards.
C) Available immediately.
D) Focused on the decision to be made.
5. An abnormal loss in a process occurs when:
A) Costs are increased as a result of defective materials
B) Actual losses are greater than the normal loss level
C) Actual losses are less than the normal loss level
D) Production levels are below budget
Solutions:
| Question # 1 Answer: B,C,E,F | Question # 2 Answer: A | Question # 3 Answer: B | Question # 4 Answer: C | Question # 5 Answer: B |
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