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Financial CMA Exam (page: 8)
Financial Certified Management Accountant
Updated on: 25-Dec-2025

Viewing Page 8 of 270
CMA PDF 1336 Questions

Details: Strategic and tactical Planning 1

Formal written policies are normally recommended. However, the presence of certain condition in an organization minimizes the need for written policies. One condition that minimizes the need for written policies is a?

  1. High division of labor
  2. Strong organizational culture.
  3. Large span of control.
  4. Strict unity of command.

Answer(s): B

Explanation:

If the culture is strong, the organization's key values are intensely held and widely shared. Substantial training has been expended to achieve this high degree of acceptance, minimizing the need for formal, written policies.




Details: Strategic and tactical Planning 1

In an organization with empowered work team, organizational policies?

  1. Should define the limits or constraints within which the work team must act if they are to remain self-directing.
  2. Become more important than ever. Without clear rules to follow, empowered work teams are almost certain to make mistakes.
  3. Should be few or none. The work teams should have the freedom to make their own decision.
  4. Should be set by the teams themselves in periodic joint meetings.

Answer(s): A

Explanation:

Work teams are not "empowered" to do anything they please. The organization has certain expectations for what is to be accomplished and how the teams are to go about accomplishing these expectations. Once the organization defines its objectives and sets appropriate policies, the work teams are able to make and implement decision within those boundaries. Policies in this context are usually quite broad (e.g. relating to ethical business conduct) but nevertheless important.




Details: Strategic and tactical Planning 1

An organization's policies and producers are part of its overall system of internal controls. The control function performed by policies and procedures is?

  1. Feedforward control
  2. Implementation control
  3. Feedback control
  4. Application control

Answer(s): A

Explanation:

Feedfroward control anticipates and prevents problem. Policies and procedures serve as feed-forward controls because they provide guidance on how an activity should be performed to best insure that an objective is achieved.




Details: Strategic and tactical Planning 1

After the goals of the company have been established and communication, the next step in the planning process is development of the?

  1. Production budget
  2. Direct materials budget
  3. Selling and administrative budget
  4. Sales budget

Answer(s): D

Explanation:

The sales budget is the first step in the operating budget process because it is needed to prepare all of the other budget. For example, the production budget cannot be prepared until the sales department has determined how many until are needed.




Details: Strategic and tactical Planning 1

In planning and controlling capital expenditures, the most logical sequence is to begin with?

  1. Analyzing capital addition proposals.
  2. Making capital expenditure decision.
  3. Analyzing and evaluating all promising alternatives.
  4. Identifying capital addition projects and other capital needs.

Answer(s): D

Explanation:

Capital budgeting is a long-term planning process for investments. This process beings with the identification of capital needs, that is of projects required to achieve organization goals. The next step is to search for specific investments. The third step is to acquire and analyze information about the potential choices. The fourth step is to select specific investments after considering both qualitative and quantitative factors. The fifth step is to finance the undertakings. Yhe final step is implementation and monitoring.



Viewing Page 8 of 270



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