About the Book
Table of Contents:
Acknowledgments of Subject Matter Experts xi
For the Student xiii
Session 1 1
Course Introduction 1
Section A, Topic 1: Financial Statements 9
Section A, Topic 2: Recognition, Measurement, Valuation, and Disclosure (Fair Value Standards and Measurement, Accounts and Notes Receivable, Inventory) 25
Session 1 Exercise 1: Inventory Valuation, LIFO to FIFO 49
Session 1 Exercise 1 Solution: Inventory Valuation, LIFO to FIFO 52
Section A, Topic 2: Recognition, Measurement, Valuation, and Disclosure (cont.): Investments, Intangibles, Short-Term Debt 53
Session 1 Exercise 2: Investments 76
Session 1 Exercise 2 Solution: Investments 79
Session 1 Wrap-Up 82
Session 2 83
Study Tips 84
Session 1 Recap 85
Section A, Topic 2 (cont.): Recognition, Measurement, Valuation, and Disclosure (Deferred Income Taxes, Leases, Equity Transactions, Revenue Recognition) 86
Section A, Topic 2 (cont.): Recognition, Measurement, Valuation, and Disclosure (Comprehensive Income, Discontinued Operations, Extraordinary Items, IFRS versus GAAP) 107
Section B: Planning, Budgeting, and Forecasting 114
Section B, Topic 1: Strategic Planning 114
Session 2 Wrap-Up 139
Session 3 141
Session 2 Recap 142
Session 3 Overview 142
Section B: Planning, Budgeting, and Forecasting 143
Section B, Topic 2: Budgeting Concepts 143
Section B, Topic 5: Annual Profit Plan and Supporting Schedules 152
Session 3 Exercise: Preparing Operating Budgets and Pro Forma Income Statement 161
Session 3 Exercise Solution: Preparing Operating Budgets and Pro Forma Income Statement 163
Session 3 Wrap-Up 166
Session 4 167
Session 3 Recap 168
Session 4 Overview 168
Section B, Topic 5: Annual Profit Plan and Supporting Schedules (continued) 169
Session 4 Exercise: Preparing a Cash Budget 174
Session 4 Exercise Solution: Preparing a Cash Budget 175
Section B, Topic 4: Budget Methodologies 178
Section B, Topic 6: Top-Level Planning and Analysis 181
Session 4 Wrap-Up 186
Session 5 187
Session 4 Recap 188
Session 5 Overview 188
Section B, Topic 3: Forecasting Techniques 189
Session 5 Exercise: Preparing Pro Forma Financial Statements, Determining External Funding Needed, and Performing Sensitivity Analysis 198
Session 5 Exercise Solution: Preparing Pro Forma Financial Statements, Determining External Funding Needed, and Performing Sensitivity Analysis 200
Section B Practice Questions 204
Session 5 Wrap-Up 205
Session 6 207
Session 5 Recap 208
Session 6 Overview 208
Section C: Performance Management 209
Section C, Topic 1: Cost and Variance Measures 219
Session 6 Exercise: Cost and Variance Measures 219
Session 6 Exercise Solution: Cost and Variance Measures 224
Session 6 Wrap-Up 227
Session 7 229
Session 6 Recap 230
Session 7 Overview 230
Section C, Topic 2: Responsibility Centers and Reporting Segments 231
Section C, Topic 3: Performance Measures 237
Section C Practice Questions 248
Session 7 Wrap-Up 249
Session 8 251
Session 7 Recap 252
Session 8 Overview 252
Section D: Cost Management 253
Section D, Topic 1: Measurement Concepts 253
Session 8 Exercise 1: Absorption versus Variable Costing 268
Session 8 Exercise 1 Solution: Absorption versus Variable Costing 269
Session 8 Exercise 2: Variable versus Absorption Costing 271
Session 8 Exercise 2 Solution: Variable versus Absorption Costing 276
Section D, Topic 2: Costing Systems 278
Session 8 Wrap-Up 282
Session 9 283
Session 8 Recap 284
Session 9 Overview 284
Section D, Topic 2: Costing Systems, continued 285
Session 9 Exercise: Equivalent Units in Process Costing 295
Session 9 Exercise Solution: Equivalent Units in Process Costing 298
Session 9 Wrap-Up 300
Session 10 301
Session 9 Recap 302
Session 10 Overview 302
Section D, Topic 3: Overhead Costs 303
Section D, Topic 4: Supply Chain Management 313
Section D, Topic 5: Business Process Improvement 323
Section D Practice Questions 333
Session 10 Wrap-Up 334
Session 11 335
Session 10 Recap 336
Session 11 Overview 336
Section E: Internal Controls 337
Section E, Topic 1: Governance, Risk, and Compliance 337
Section E, Topic 2: Internal Auditing 352
Section E, Topic 3: Systems Controls and Security Measures 357
Section E Practice Questions 365
Session 11 Wrap-Up 366
Session 12 367
Session 10 Recap 368
Session 12 Overview 368
CMA Exam Format 369
Test-Taking Tips and Strategies 369
Overview of Essay Questions 370
What to Expect at the Testing Center 377
Part 1 Course Wrap-Up 377
