Wiley Cmaexcel Learning System Exam Review 2015: Part 1: Financial Reporting, Planning, Performance, and Control
Wiley Cmaexcel Learning System Exam Review 2015: Part 1: Financial Reporting, Planning, Performance, and Control
Wiley CMAexcel Learning System, Part 1: Financial Reporting, Planning, Performance, and Control.
Copyright © 2014, Institute of Management Accountants. Published by John Wiley & Sons, Inc.
Session 3 Recap
• Section B, Topic 2: Budgeting Concepts
• Section B, Topic 5: Annual Profit Plan and Supporting
Schedules
• Exercise: Preparing Operating Budgets and Pro Forma
Income Statement
Financial Budgets
• Capital budget
• Cash budget
• Pro forma balance sheet
• Pro forma statement of cash flows
Pro Forma
Pro Forma
Income Capital Cash
Income
Statement Budget Budget
Statement
Based on ICMA Part 1, Section B, Topic 5: Annual Profit Plan and Supporting Schedules 7
question, used Wiley CMAexcel Learning System, Part 1: Financial Reporting, Planning, Performance, and Control.
with permission Copyright © 2014, Institute of Management Accountants. Published by John Wiley & Sons, Inc.
Pro Forma Schedule of Cash Receipts and
Cash Disbursements
Cash receipts
Sales—40% same month $9,353,600
30%—1-month lag 6,985,000
20%—2-month lag 3,906,400
10%—3-month lag 2,005,000
Total cash receipts $22,250,000
If subcomponent inspection labor costs $12 per hour and the final assembly
inspection costs $15 per hour, what amount would be included as inspection
labor in the indirect labor amounts?
Answer: 1,440 hours × $12 = $17,280
216 hours × $15 = $3,240
$17,280 + $3,240 = $20,520
Based on ICMA Part 1, Section B, Topic 4: Budget Methodologies 17
question, used Wiley CMAexcel Learning System, Part 1: Financial Reporting, Planning, Performance, and Control.
with permission Copyright © 2014, Institute of Management Accountants. Published by John Wiley & Sons, Inc.
Question: Budget Methodologies
In which method of budgeting must the cost of each program be
justified, starting with the one most vital to the company?
a. Continuous budgeting
b. Flexible budgeting
c. Incremental budgeting
d. Zero-based budgeting
Answer: d.
Zero-based budgets, as the name implies, start with zero
dollars allocated.
Where:
CA = Current Assets TA = Average Total Assets
CL = Current Liabilities TE = Average Total Equity
NI = Net Income TL = Total Liabilities