Management Accounting Practice Exam

About Management Accounting
Management accounting focuses on all accounting aimed at informing management about operational business metrics. It uses information relating to costs of products or services purchased by the company. Budgets are often used to quantify the decisions made in operational planning. Management accountants use performance reports to note variances between actual results from budgets.

Managerial accounting encompasses many facets of accounting aimed at improving the quality of information delivered to management about business operation metrics. Managerial accountants use information relating to the cost and sales revenue of goods and services generated by the company. Cost accounting is a large subset of managerial accounting that specifically focuses on capturing a company's total costs of production by assessing the variable costs of each step of production, as well as fixed costs. It allows businesses to identify and reduce unnecessary spending and maximize profits.

Why is Management Accounting important?
Management Accounting provides various benefits as
•    Planning - In management accounting, the financial information and non-financial information is presented at regular intervals say weekly, fortnightly to the management. This presentation includes forecasts, budgets, and in-depth analysis. Hence it assists the management in planning the business activities.
•    Decision making - Since management accounting presents various charts, forecasts, and analysis the management uses it for decision making.
•    Identify early signs of problems - If a product is not performing well the management can identify it early on as the accounts are presented at regular intervals. This will aid in overcoming the constraints early on and avoiding future losses.  
•    Strategic management - Based on the information presented in management accounting, the management can make decisions about continuing a product or modifying the sale strategy. Since management accounting is not regulated by any law, the management can decide the areas that require more analysis, investigation and accordingly draw up strategies.
•    Helps in Making Plans - Management accounting assists organization in making better plans for future activities. It supplies all financial and non-financial data to management on a regular basis. Managers through the availability of all these information are able to perform better analysis and forecasting which enables them in framing proper plans.
•    Assist in Decision Making - Efficient decision making is a major role played by management accounting. It collects and analyses all financial information available within organization and present them in simplified charts, tables or graphs. Management gets better understanding regarding organization affairs and is able to take correct decisions at right time.
•    Measures the Performance - Management accounting monitors and measures the overall performance of organization. It uses various tools like variance analysis which measures the company performance with pre-established standards for finding out the deviations. Managers by identifying all variations in performance of company are able to take corrective measures accordingly for removing them.
•    Increases the Efficiency - This accounting branch aims at raising the overall efficiency of business organizations. Management accounting sets target for each division in advance and checks whether they fulfil all targets. It ensures that all resources are fully utilized which helps in improving the efficiency.
•    Better Service to Customers - Management accounting focuses on better service to customers by providing them quality goods at fair prices. It helps in controlling the prices of products by employing cost control devices. In addition to that, it sets various quality standards to be met by organization for producing their goods.
•    Raises the Profitability - It has an efficient role in enhancing the profitability of organizations. It makes companies cost conscious and assist in avoiding all extra expenditures. Management accounting uses techniques such as budgetary control and capital budgeting for reducing the expenses which helps in earning better profits.
•    Provides Reliability - Management accounting adds reliability to management decisions by providing them genuine information. It uses proper scientific tools and techniques for analysis purposes which helps managers in the proper management of business operations.

Who should take the Management Accounting Exam?
•    Finance and accounting professionals
•    Innovators
•    Anyone who wants to assess their skills
•    Managers and senior executives
•    Accounting consultants
•    Any professional engaged in operational management of company

Knowledge and Skills required for the Management Accounting Practice Exam

Critical thinking and good communication skills helps candidate to gain heights in their managerial accounting career.

Management Accounting Practice Exam Objective

Management Accounting exam focuses on assessing your skills and knowledge in management accounting including costing, EVM, control and performance management.

Management Accounting Practice Exam Pre-requisite

Knowledge of financial and managerial accounting  is prerequisite for the Management Accounting exam.

Management Accounting Certification Course Outline
1. Introduction to Management Accounting
1.1 Concepts of Cost
1.2 Costing, Cost Accounting and Cost Accountancy
1.3 Objectives of Cost Accounting
1.4 Importance of Cost Accounting
1.5 Scope of Cost Accounting
1.6 Classification of Costs
1.7 Cost Centre and Cost Unit
1.8 Methods of Costing
1.9 Techniques of Costing
1.10 Installation of a Costing System
1.11 Difference between Financial Accounting and Management Accounting

2. Standard Costing
2.1 Introduction
2.2 Definition and Meaning
2.3 Applications of Standard Costing
2.4 Various Types of Standards
2.5 Standard Costing System
2.6 Variance Analysis
2.7 Material Cost Variances
2.8 Material Usage Variance
2.9 Material Mix Variance
2.10 Materials Yield Variance
2.11 Overhead Cost Variances
2.12 Variable Overhead Variance
2.13 Fixed Overhead Variance

3. Budget, Budgeting and Budgetary Control
3.1 Budget
3.2 Budgeting
3.3 Budgetary Control
3.4 Forecast and Budget
3.5 Zero Base Budgeting

4. Performance Measurement
4.1 Metrics and measurement    
4.2 Role    
4.3 Performance Measurement Process    

5. Control Management
5.1 Organizational Control    
5.2 Financial Controls    
5.3 Lean Control System

6. Performance, Schedule and Cost of Projects
6.1 Performance    
6.2 Project Schedule    
6.3 Project Cost

7. Earned Value Management
7.1 Introduction    
7.2 Earned value management    
7.3 PBEV: The EVM extension focusing on technical performance    
7.4 PBEV model adaptation to industrial production environment    
7.5 Applying PBEV to engine engineering projects    


Exam Format and Information
Certification name – Management Accounting Certification
Exam duration – 60 minutes
Exam type - Multiple Choice Questions
Eligibility / pre-requisite - None
Exam language - English
Exam format - Online
Passing score - 25
Exam Fees  - INR 1199