Free IMA CMA Part 1 (Financial Planning, Performance, and Analytics) Performance Management Practice Questions

Performance Management on CMA Part 1 covers cost-volume-profit analysis, variance analysis (direct materials, direct labor, factory overhead, sales-mix and sales-quantity), responsibility centers (cost, revenue, profit, investment), key performance indicators, balanced scorecard, and segment reporting. Variance analysis is a frequently tested computational area.

159 Questions
60 Easy
65 Medium
34 Hard
2026 Syllabus

Sample Questions

Question 1 Easy
Which of the following best describes an investment center?
Solution
A is correct. An investment center is a responsibility center whose manager is accountable for revenues, costs, and the capital (asset) investment used by the segment. Performance is typically evaluated using ROI, residual income, or EVA.
Question 2 Medium
Which of the following performance measures would most appropriately be classified under the internal business process perspective of a balanced scorecard?
Solution
B is correct. The internal business process perspective measures the efficiency and effectiveness of internal operations that create value for customers, including manufacturing cycle time, defect rates, on-time delivery, and order fulfillment time. Cycle time directly captures how quickly the firm converts inputs into finished output ready for the customer, making it a core internal-process metric.
Question 3 Hard
A company's standard cost for direct materials is 3 pounds per unit at $4.00 per pound. During the period, the company produced 5,000 units and used 16,000 pounds of material at a total cost of $62,400. What is the total direct materials variance (price plus quantity)?
Solution
C is correct. Actual price per pound = $62,400/16,000=$3.90\$62{,}400 / 16{,}000 = \$3.90. Standard quantity allowed = 5,000×3=15,0005{,}000 \times 3 = 15{,}000 pounds. Price variance = ($3.90−$4.00)×16,000=$1,600(\$3.90 - \$4.00) \times 16{,}000 = \$1{,}600 favorable. Quantity variance = (16,000−15,000)×$4.00=$4,000(16{,}000 - 15{,}000) \times \$4.00 = \$4{,}000 unfavorable. Total variance = $4,000 U−$1,600 F=$2,400\$4{,}000 \text{ U} - \$1{,}600 \text{ F} = \$2{,}400 unfavorable. Equivalently, actual cost $62,400 minus standard cost allowed 15,000×$4=$60,00015{,}000 \times \$4 = \$60{,}000 equals $2,400 unfavorable.
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