CMA P1 Plan A4 PDF

Dear CMA Part 1 Candidate,
Studying for and passing the CMA Exams is a mission that requires dedication and hard work.
From our experience at HOCK helping thousands of candidates, we know that planning makes this
process much easier. Because the exam is available throughout the year and there is no specific
date by which you need to be prepared, studying can seem endless without a proper plan. We
know it is easy to “put things off until tomorrow.” However, you cannot afford to do that. Under
the guidelines for the exams, you are required to complete the program within 3 years of your
entry into the program. If you do not successfully complete both exam parts within 3 years of
entering the certification program, any passed part will expire. To continue in the program, you
will be required to pay the CMA entrance fee again and retake the expired part.
We believe that you will find studying easier and less time consuming if you have a solid plan that
targets passing the Part 1 Exam within three to four months after you begin studying. Set out
below is a 17-week plan, studying 8 to 10 hours per week. This is simply a guide based on the
expected amount of study time for a person with some financial background who is familiar with
the basic exam concepts. You may be able to complete the preparation in less time, or you may
need more time.
This Study Plan is organized in Study Units. Each Study Unit has a recommended study time of
two or three weeks. In My Studies you will find the PassMap, an interactive step-by-step study
guide that you can use along with the Study Plan to track your progress through the study mate-
rials.
As you go through your schedule, you may find yourself getting ahead or somewhat behind due
to changes in your work or personal commitments. Do not be concerned if that occurs. Each
person should study at his or her own pace and feel comfortable with the study process and time
required to prepare for the exams. You can revise your dates and update your PassMap anytime.
While studying, there are sure to be things that are not clear to you and perhaps some that you
find incredibly difficult. HOCK provides teacher support for study materials purchased from us. We
will even do our best to help with questions from other course providers that may not appear in
HOCK study materials. Please feel free to contact us, and we will help you as much as possible.
Also, keep in mind that you do not need to have 100% knowledge of 100% of the exam content
in order to pass. At certain points, you will need to decide whether the extra time spent learning
something is worth the extra knowledge gained. When in doubt about what to do, contact us and
we will guide you.
I wish you great success in your studies and look forward to helping you pass the exams.
Sincerely,
Brian Hock, CMA, CIA

President and CEO
March 2020
HOCK international ¨ www.hockinternational.com ¨ 1-866-807-4625 ¨ 1-281-652-5768

CMA Part 1 Study Plan
How to Use Your HOCK Study Materials

The HOCK study materials for the CMA exams consist of a suite of study materials that has
been developed for use as an integrated program. This Study Plan will include references to
all of the components, and you can apply it to the components you have.
If you follow this Study Plan, you will significantly increase your chances of passing
the exam.
The study materials include the following:
1) Textbook.
2) Questions, including:
• ExamSuccess containing over 1,000 multiple-choice questions and answer expla-
nations for each exam part, available for use online from any device or as an app
that can be used offline on iPhones, iPads, iPod touches, and Android phones and
tablets.
• Practice essay questions, available in ExamSuccess Online, with detailed answers,
many of which also have companion instructional videos.
• Flash cards.
• Two mock exams.
3) Videos including both streaming instructional videos and downloadable audio mp3
recordings containing the soundtracks from the videos.
This Study Plan will guide you by giving you assignments as follows as you progress through
the program:
1) Reading assignments in your textbook, which include answering the questions in the
book.
2) Assignments for the video/audio recordings.
3) Assignments for multiple-choice questions to be answered in ExamSuccess after each
reading assignment.
4) Assignments for essay problems to be answered after completing each major Section
(A, B, and so forth).
This Study Plan does not contain specific assignments for the flash cards. The flash cards can
be used for review in whatever way you wish. They should not be used as a substitute for
reading the textbook, however, because they are too brief for that.
Information on use of the mock exams is provided in the Comprehensive Review in the last
unit.
www.hockinternational.com ¨ support@hockinternational.com ¨ 1-281-652-5768 ¨ Page 1

How to Use the HOCK Textbook

Your textbook is the core of the HOCK study program. It contains explanations of con-
cepts, examples, and multiple-choice questions within the reading to be answered as you are
going through the book. You will find a pdf version of the textbook in My Studies, which you
may print as you wish. If your purchase included a printed copy of the textbook, you also
have online access in My Studies to the same book and to future updates to it in pdf format.
The correct answers to the questions in the book appear at the end of the book, and they are
also available on the access page in My Studies next to the textbook as a separate document
file for easier reference.
If an update to the textbook you purchased is published, the revised textbook will be posted
in My Studies in place of the previous version for you to download.
Note: We advise students to focus the majority of their study time on reading and learning
the material in the book so they will understand the concepts and be able to answer the
unfamiliar questions they will face on the exam. Candidates who spend all their study time
answering the practice questions learn how to answer those questions, but they may not
have the understanding they need to answer the exam questions, which will be very dif-
ferent from the practice questions. The understanding needed to pass the exam comes
from studying and learning the material in the book. The purpose of the questions is to
practice using the concepts studied in the book to answer questions because that is what
you will need to be able to do to pass the exam. But you first must know the concepts.
How to Use the HOCK Flash Cards

Your flash cards are available for downloading in the Flash Cards area of the access page in
My Studies. How you choose to use the flash cards is entirely up to you. They are not included
in the assignments in this Study Plan. The flash cards cannot replace the textbook because
they contain abbreviated information from the textbook. However, you might use them, for
example, to drill on formulas you need to memorize or to review concepts.
The flash cards are in PowerPoint format and are compatible with Windows or Mac computers
and most mobile devices. They can be used on-screen or they can be printed. Instructions
for their use are in My Studies on the access page.
How to Use the HOCK Videos

If your purchase included videos, you will find links to the videos as well as to the associated
audios on the access page in My Studies for each exam part you purchased. The audios are
the soundtracks from the videos. The videos must be used online because they are supplied
as streaming videos, but the audios are in mp3 format and you can download them and listen
to them on a computer or mobile device.
The videos and audios are intended to supplement the textbook. Not all topics covered on
the exam are covered in the videos and audios, so they cannot take the place of
reading and studying your textbook.
Each topic in the videos/audios should be used after reading the topic in your textbook. This
Study Plan will guide you in which videos/audios to use at each point in your reading.

How to Use ExamSuccess Multiple-Choice Questions

The multiple-choice questions in ExamSuccess should be used to practice using the concepts
you have studied in your book. The questions should be used as you progress through the
book. Each topic’s questions in ExamSuccess should be answered after reading the topic in
your textbook. This Study Plan will guide you in which questions to answer at each point in
your reading.
Answering practice questions alone, without studying the book, will not prepare
you for the exam because the questions on the exam will be very different from the practice
questions in ExamSuccess. Only knowing the concepts will prepare you to answer the unfa-
miliar questions on the exam. Knowing the concepts comes from studying the book.
ExamSuccess contains over a thousand multiple-choice practice questions for each exam
part. ExamSuccess is offered in two formats, and candidates with access to ExamSuccess
have access to both formats at no additional cost:
• ExamSuccess Online can be used from any computer or mobile device that is con-
nected to the Internet, and
• The HOCK CMA Prep mobile app by Appitur® can be used offline on iOS and
Android mobile devices.
ExamSuccess Online and the HOCK CMA Prep mobile app by Appitur® use exactly the same
multiple-choice questions and the questions are organized according to the same Section and
Subsection names.
Note: If you use ExamSuccess in both formats, your performance is not synced between
the two formats.
After completing the reading and the questions in the book for each assigned topic, answer
the multiple-choice questions on that topic in ExamSuccess.
Note: It is very important to answer the multiple-choice questions in ExamSuccess as

you are progressing through the book. Do not wait until you have read the whole book
to start answering questions in ExamSuccess. ExamSuccess gives you an opportunity to
put into practice the concepts you have been reading about. Practice is very important for
learning, and you should answer the assigned questions as soon as you complete each
block of assigned reading.
Using ExamSuccess Online

ExamSuccess Online is available in My Studies on the access page. To use it, create and
complete a Study Session consisting of all the multiple-choice questions available on the
topic you are studying.
Select the Section, then click on the link “Study Session” under that Section. On the next
page, you will see two choices of Study Sessions to create:
1) Select your own mix of questions from the topics in Section [Section letter and name].
2) Select questions from Section [Section letter and name] containing any of the follow-
ing terms.
The default is no. 1, “Select your own mix of questions from the topics in Section [Section
letter and name].” HOCK recommends the use of the default initially, because that choice
enables you to narrow the selection of questions to the single topic that you have been read-
ing and studying.

To request questions from a specific topic or topics, fill in the number of questions you want
to see from one (or more) topics. HOCK recommends when you create a Study Session that
you request the maximum number of questions available, because that ensures you will see
all the questions in the question database for that topic. Scroll down to the “Start Session”
button and click it.
You do not need to answer all of the questions in the Study Session at one sitting. You can
click “Save” to close a session without grading it. Later, clicking on the Section link will re-
open the session so you can work on it some more. You can have only one Study Session per
Section saved and in progress at a time.
Note: If you have a saved session in progress and click on “Study Session,” your saved
session will open automatically. If you want to start a new and different session, you will
need to end the session in progress. You cannot have two different sessions of the same
session in progress at the same time.
As you answer each question in a Study Session, click the “See Answer” button below the
question. You will receive immediate feedback for your answer.
• If you answered the question correctly, you will see a green checkmark next to your
answer.
• If you answered the question incorrectly, you will see a red “x” next to your answer.
Regardless of whether you answered the question correctly or incorrectly, you will see answer
explanations for all four answer choices, the correct answer and the three incorrect answers.
Once you have viewed the answers, you cannot change your answer choice.
To close out and grade a Study Session, click the “End Session” button. You will see your
score and a review of all the questions in the Study Session along with answer explanations.
Questions answered incorrectly will be shown first, followed by questions answered correctly.
You can create another Study Session from the same Section and topic after you have ended
your current Study Session.
When you have completed the Study Session and graded it, re-study all questions not an-
swered correctly on the first try by creating a new Study Session from those questions not
answered correctly on the first try, looking up in the book and re-studying the topics missed,
and then answering the incorrectly answered questions again. Keep doing that until you have
scored at least 85% correct and preferably over 90% correct before moving on to the next
topic.

Note: When you use the option to select your own mix of questions (the first option),
questions are selected and shown in the following order: 1) unseen questions, 2) questions
not yet answered correctly, and finally 3) questions answered correctly.
The number of questions answered correctly and the total number of questions in the topic
is shown to the right of the topic, for example “12 correct out of 20.”
Therefore, after you have answered all the questions in a given topic (thus you have seen
them all) and have ended the session, you can create a new Study Session from questions
not answered correctly by requesting another Study Session on the same topic consisting
of the number of questions not answered correctly. Using the example of “12 correct out
of 20,” a Study Session created consisting of 8 questions will present you with questions
you have not yet answered correctly.
Make sure you complete all of the questions for each topic before moving on to study the
next topic.
As you complete each full Section (A, B, and so forth), a review in ExamSuccess should be
part of your overall review of the Section. Review Sessions are available for each Section and
for multiple Sections cumulatively.

Using ExamSuccess in the HOCK CMA Prep Mobile App by Appitur®

The HOCK CMA Prep mobile app is available to download from the app store for your mobile
device. If you already have access online to ExamSuccess, you do not need to re-purchase
the exam parts you already have access to. After downloading the app, log in using your
HOCK email address and password in order to access the exam parts you have already pur-
chased. Select the exam part you want to study and then select either “Study” or “Exam.”
If you select “Study,” under “Study Settings” use the Section Filter to select the Section and
then the Subsection Filter to select the Subsection. Then select the number of questions using
the slider. The default is the maximum number of questions available. After you select your
answer to each question, scroll down to see whether you answered it correctly and to view
the answer explanation or explanations. To move to the next question, select “Next.” You
can skip questions and you can use the “Summary” button at any time to view links to each
question and get back to answered or unanswered questions. To close out a session at any
time, select “Close.” Until you have answered all the questions and selected “Complete,” the
session will still be open when you return to complete it, and you can go back and add and
change answers by using the “Summary” button. After you have answered all the questions
in the session, select “Summary” and then “Complete” to record your answers. Your score
will be displayed along with the questions and answers.
If you select “Exam,” you will be presented with 100 questions drawn from all of the Sections
and timed for 3 hours. However, you can also choose to answer fewer than 100 questions,
and the timer will be adjusted accordingly. Select “Summary” to complete any unanswered
questions and then “Complete” to close out the exam when you have answered all of the
questions. Your score will be displayed along with a summary of your performance by Section.
Note: If you purchased the HOCK CMA Complete program with the “You Pass or We Pay”
Guarantee, you must use ExamSuccess Online to fulfill the ExamSuccess portion
of the requirements to qualify for the guarantee. These requirements cannot be met
using the mobile App.
Periodic Reviews
In addition to completing each block of questions as you complete each block of reading and
in addition to reviewing at the end of each Section, periodically stop and create a Study
Session in ExamSuccess of around 40 questions drawn from all the topics you have studied
to date. Doing that will keep you fresh on the topics you studied earlier so you do not forget
the material.

Updates
HOCK is always improving ExamSuccess by adding new questions and improving answer
explanations to existing questions.
• Updates made to ExamSuccess Online are reflected immediately in the questions you
see online. You do not need to take any action.
• Updates to the HOCK CMA Prep mobile app by Appitur® take place automatically
through the App Store. You do not need to take any action.
Final Review
When you have completed your preparation, take several practice exams in ExamSuccess as
part of your overall review:
• If you are using ExamSuccess Online, use the CMA Part 1 Practice Exam that you will
find at the end of the Section listings on the ExamSuccess Online home page.
• If you are using the HOCK CMA Prep mobile app by Appitur®, choose Exam on the
setup screen.
In both formats, the Exam will consist of 100 multiple-choice questions drawn from the same
question database as the Study Sessions are drawn from, and you will be timed for 180
minutes (3 hours).1 The question topics will be in the same proportion as the actual exam
questions will be. You may create and complete as many Exams as you wish, and the ques-
tions will be different each time, though always selected randomly from the database of
questions.2
How to Use the Essay Questions

Practice essay questions are provided in ExamSuccess to help you become comfortable with
the format of essay questions and with answering essay questions on-screen. The essay
problems should not be used to learn the concepts for the essay portion of the
exam, although they may point out weak areas for your review for the whole exam. The
essay questions you will receive on your exam will be different questions from these practice
essays and probably will cover completely different topics. Use of your textbook along with
the multiple-choice questions in ExamSuccess is the best way to learn the concepts you will
need to know for the whole exam, including the essay portion. These practice essay questions
will help you learn how to use the concepts to construct a written response answer.
The essay questions for each Section should be used as you complete that Section. This Study
Plan will guide you in when to answer the essays for each Section.
The essay questions are available in ExamSuccess Online in the Essay Questions area of the
access page in My Studies. Click the button for “Use ExamSuccess Online” and then select an
Essay Session. The Essay Session is the fourth item in the list of choices underneath each
Section heading. You can enter your answers for each Section’s essay questions online and
then compare your answers with the suggested answers. The answers for all the essay ques-
tions in the Section (if more than one) will be presented when you have completed all of the
1
If you are using the HOCK CMA Prep App by Appitur®, you can choose to take a shorter exam with questions
drawn from all the Sections.
2
If you have the HOCK “You Pass or We Pay” Guarantee, to be eligible you must 1) Watch 95% of the videos, 2)
Answer 90% of the MCQs correctly, and 3) Pass one mock exam with a 70% score (first attempt only) or two whole-
Part review sessions with an 80% score (multiple attempts allowed). You must use ExamSuccess Online for the
question requirements.

essay questions for the Section. Where a video explanation is available, a button titled “Watch
Video Explanation” is above the answer.
Most of the practice essay questions and their answers have been provided by the ICMA. The
ICMA, the Institute of Certified Management Accountants (not the IMA), is the entity that is
responsible for administering the CMA exams and for certifying candidates who fulfill all the
requirements for certification.
The CMA exam does not provide a spreadsheet application for answering essay questions,
and the ICMA has stated that none of the essay questions on the exam will require columnar
work.3 Accordingly, none of the practice essay questions will require the use of a spreadsheet
to answer.
How to Use the Mock Exams

Two mock exams, with answer explanations, are available in ExamSuccess Online. The mock
exams contain new questions not used elsewhere in the study materials. The mock exams
provide a measure for your exam readiness and are a solid last review before taking the real
exam.
Each mock exam contains 100 multiple-choice questions and two essay questions, just as
the real exam does. You should set aside four hours to take each one. Answer explanations
are provided after you complete the mock exam.
After you have completed the mock exam, look up and re-study the topics on which you
missed questions and then answer those questions again. Grading information for the essay
portion of the mock exams is not available, though answers to the essays are provided.
However, the essay portion of the real exam accounts for 25% of your grade, and you may
be able to estimate the contribution to your score from your performance on the essays based
on that assumption.
3
However, if the ICMA does ask an essay question on the exam that requires columnar work such as a financial
statement, do not spend any time formatting your answer. Just get the information down, and do not worry about
whether your columns are straight. You will not have time for formatting.

Other Information
Three additional documents are available for downloading in My Studies. They are:
• Sample Grading, an example of how a former exam question was graded by the
ICMA, is available in the Essay Questions area of the access page. This example was
supplied by the ICMA and will help you to understand what will be expected. HOCK
recommends you download the Sample Grading document and review it be-
fore you attempt answering your first essay question.
• HOCK’s Exam Tips is a document prepared by HOCK that contains some tips for the
multiple-choice portion and the essay portion of the exam and some general strate-
gies for exam day. It is available in the Final Tips area of the access page in My
Studies.
• Test-Taking Strategies is also available in the Final Tips area of the access page.
This document was supplied by the ICMA and contains some suggestions for how to
approach the exam.
HOCK recommends you download the Test-Taking Strategies and HOCK’s Exam Tips docu-
ments, review them early in your preparation, and make use of them as you prepare.
Textbook and Other Study Materials

The components of the study program other than the textbook are intended to supplement
the textbook. Therefore, the other components do not necessarily cover every topic in the
Learning Outcome Statements as the textbook does and thus cannot take the place of the
textbook.
Furthermore, the number of study questions on each topic in your study materials is not
intended to imply the prominence of each topic in the real exam. The coverage of each major
Section on the exam is given in terms of percentages at the beginning of each Section in the
HOCK textbook and is in all of the informational materials from the Institute of Certified
Management Accountants.
Alignment with the ICMA’s Learning Outcome Statements

We have tried to cover all of the ICMA’s Learning Outcome Statements (LOS) in the HOCK
textbook. The major Sections have been kept in their sequential order (A through F) as they
are ordered in the Learning Outcome Statements. In the books, the topics are identified with
the same alpha-numeric identification used for topics in the Learning Outcome Statements
so candidates can tie the material in the books to the requirements in the Learning Outcome
Statements.
Note: The exam questions will be presented in random order, not in Section order or
Learning Outcome Statement order.

Unit 1: 3 Weeks
Section A – External Financial Reporting Decisions
Section A, External Financial Reporting Decisions

Section A, External Financial Reporting Decisions, constitutes 15% of the exam. It contains
three major topics:
A.1. Financial Statements
A.1.5. Integrated Reporting
A.2. Recognition, Measurement, Valuation and Disclosure
The objective of financial reporting is providing financial and non-financial information about
the entity that is useful for decision-making.
• Those using the financial information to make decisions include present and potential
equity investors, lenders, and other creditors who need to make decisions about
providing resources to the entity. The decisions relate to buying, selling, or holding
debt or equity instruments and providing credit. In order to make these decisions,
investors, lenders and other creditors need information that will help them assess the
amount of, timing of, and prospects for future net cash inflows to the entity.
• Integrated reporting includes non-financial information and concerns an organiza-
tion’s ability to create value over time. The primary purpose of an integrated report
is to explain to providers of financial capital how the organization creates value over
time. An integrated report also provides information to other stakeholders that are
interested in the organization’s ability to create value, such as employees, suppliers,
business partners, local communities, legislators, regulators, and policy-makers.
Note: The information on External Financial Reporting Decisions in your CMA Part 1 text-
book covers the ICMA’s Learning Outcome Statements. However, the coverage of
accounting and external financial reporting is not exhaustive because the CMA exam and
thus these study materials assume a prior knowledge of accounting.
A.1. Financial Statements

Financial Statements I
Textbook Read the Introduction to CMA Part 1
Volume 1:
In A.1. Financial Statements, read the following topics and an-
swer the questions in the book for:
Users of Financial Information
The Financial Statements
Differences Between IFRS and U.S. GAAP
The 5 Accounting Statements
Notes to the Financial Statements
Answer explanations for the questions are at the end of the volume
and are also available in My Studies as a separate document.
Videos/Audios: Watch/listen to:
The Balance Sheet
The Income Statement
The Statement of Cash Flows
Statement of Comprehensive Income
Statement of Changes to Owners’ Equity
Limitations of Financial Statements

Unit 1: 3 Weeks
ExamSuccess: Answer all of the multiple-choice study questions in ExamSuccess

for:
Financial Statements - Other Than Statement of Cash Flows
Financial Statements II – Preparation of the Statement of Cash Flows

Textbook In A.1. Financial Statements, read the following topic and answer
Volume 1: the questions in the book for:
Preparation of the Statement of Cash Flows
You will find a supplemental example of the calculation of a state-
ment of cash flows on the CMA Part 1 Textbook page in My Studies.
It is in an Excel spreadsheet next to the buttons for downloading the
textbook. The balance sheet is on one worksheet, the income state-
ment is on another worksheet, and the statement of cash flows is on
a third worksheet within the Excel file. This example is not in the
book.
Introduction to SCF
SCF Preparation Overview
SCF Indirect Method
SCF Investing and Financing Activities
for:
Financial Statements – Statement of Cash Flows
Financial Statements III – Integrated Reporting

Textbook In A.1.5 Integrated Reporting, read the following topics:
Volume 1:
Introduction to Integrated Reporting
The International <IR> Framework
Sustainability Accounting Standards Board
Introduction to Integrated Reporting
The Capitals and Value Creation
Integrated Reporting Components and Principles
for:
Financial Statements – Integrated Reporting

Unit 1: 3 Weeks
A.2. Recognition, Measurement, Valuation and Disclosure

Current Assets
Textbook In A.2. Recognition, Measurement, Valuation, and Disclosure,
Volume 1: read the following topics and answer the questions in the book for:
1) Asset Valuation
1a) Cash and Cash Equivalents
1b) Accounts Receivable
1c) Inventory
Cash
Valuing Accounts Receivable
Factoring Receivables
Recording Inventory
Inventory Formulas
Inventory Tracking Methods
Inventory Count
Inventory Errors
Inventory Valuation
for:
Cash & Cash Equiv., Accounts Receivable, and Inventory
Investments and Long-Term Assets

1d) Investments
1e) Property, Plant, and Equipment
1f) Intangible Assets
Introduction and Debt Investments
Equity Investments without Significant Influence
Equity Investments with Significant Influence
Equity Investments with Control
Recording Fixed Assets
Depreciation
Depreciation for Tax Purposes
Impairment of Fixed Assets
Disposal of Fixed Assets
Recording Intangibles
Impairment of Intangibles
for:
Investments, PP&E (Fixed Assets), and Intangible and Other
Assets

Unit 1: 3 Weeks
Liabilities and Income Taxes

Volume 1: read the following topic and answer the questions in the book for:
2) Valuation of Liabilities (all topics 2a through 2d)
Reclassification of Short-Term Liabilities
Warranties
Accounting for Income Taxes
Disclosures on the Balance Sheet
Temporary Timing Differences
Permanent Timing Differences
Net Operating Losses
Leases
for:
Liabilities and Taxes
Equity
Volume 1: read the following topic and answer the questions in the book for:
3) Equity Transactions
Common Stock
Preferred Stock
Classification of Shares
Treasury Stock
for:
Owners’ Equity

Unit 1: 3 Weeks
Revenue Recognition and Income Measurement and US GAAP/IFRS Differences

4a) Revenue Recognition
4b) Income Measurement
Intro to Revenue Recognition
Steps in Revenue Recognition Process
Right of Return and Consigned Goods
Point in Time Contracts
Over-Time Contracts
US GAAP and IFRS Differences
for:
Revenue Recognition
Section A Practice Essay Questions

You will find the online practice essay questions in ExamSuccess Online. Before answering
any essay questions, it would be a good idea to download the Sample Grading from the ICMA,
available behind the button labeled “Sample Grading Guide” in the Practice area of the access
page.
Many of the essay questions also have video answers. If a video answer is available, it is
accessible along with the text answer.
Answer all of the essays in the Section A Essay Session in ExamSuccess Online.

Unit 1: 3 Weeks
Review of Section A
If you have had particular difficulty with a topic or topics in this Section, begin your review
by completing a multiple-choice question Study Session in ExamSuccess consisting of ques-
tions from just that topic or those topics.
In addition to doing that, you should review specifically all the topics in Section A by answer-
ing at least 25 multiple-choice questions in ExamSuccess from the entire group of Section A,
External Financial Reporting questions or by completing the Review Session available in Ex-
amSuccess Online.4
HOCK recommends that you create a study sheet consisting of the items you will need to
memorize for the exam. You can wait until you are finished studying and do that as part of
your overall review, or you can create it Section by Section as part of your Section reviews.
If you have chosen to create it Section by Section, now is the time to create it for Section A.
Creating the study sheet is in itself a learning experience, and for that reason we do not do
it for you. It will be much more meaningful to you if you make the study sheet yourself and
then review it than it would be to review one that has been made for you.
Note: For candidates who have access to the Videos, final Review Videos are available by
Section to assist with your review. The Final Review Video for Section A is on the access
page in My Studies in a separate location below the individual Section videos.
4
Remember that if you have the HOCK “You Pass or We Pay” Guarantee, to be eligible to claim your exam re-
registration fee in the event you fail the exam, one of the requirements is that you must answer 90% of the MCQs
correctly. ExamSuccess Online must be used to fulfill this requirement.

Unit 1: 3 Weeks
Administrative Task: If this is your first exam, be sure to become a member of the IMA
and pay your certification entrance fee. You need to be a member of the IMA and pay the
certification entrance fee before you will be able to register for any exam.
You can become an IMA member anytime, but it would be wise to wait to pay the certifi-
cation entrance fee until you are ready to register for your first exam. The entrance fee is
valid for three years, and if you have not passed both exams within three years of paying
the fee, you will need to pay the fee again. Thus, it is best to wait until the last possible
moment to pay it. (Payment of the entrance fee provides access to a “CMA Support Pack-
age” published by the IMA. However, the same study questions that are in the IMA’s
Support Package are available in your HOCK study materials.)
Before you will be able to schedule your exam appointment, you will need to register with
the ICMA for the exam and receive your authorization number. The IMA processes exam
registrations for the ICMA in the online store on its website at www.imanet.org. You can
also call the IMA to register. Exam registrations are processed immediately, and an email
containing your authorization number is sent out with the subject “CMA Exam Authoriza-
tion Letter.” More information about how to register for an exam is available on the HOCK
website at http://www.hockinternational.com/cma/cma-exam-registration-fees/.
After receiving your authorization email from the ICMA, you can schedule your exam ap-
pointment with the Prometric testing center on its website at www.prometric.com.
However, wait for about an hour after receiving the authorization email before trying to
schedule your exam appointment with Prometric to allow time for the IMA’s website to
synchronize its information with the Prometric website.
Your exam registration will authorize you to take the exam any time within the two-
month testing window that you select when you register. The testing windows are
January-February, May-June, and September-October.
Depending upon appointment availability at the Prometric testing center you use, you may
need as much as 6 weeks lead time to get your desired exam appointment date. The ICMA
is not responsible if you are not able to schedule an exam appointment within your au-
thorization period.
However, do not register too soon, or you may find yourself appearing for the
exam before you are prepared for it. It is better to wait to register until you are far
enough along in your studies to be able to project when you will be ready to take the
exam.
More information on scheduling an exam appointment is available in the ICMA’s CMA Can-
didate Handbook, available through a link on the IMA’s website and also through a link on
HOCK’s website at http://www.hockinternational.com/cma/cma-exam-requirements/.

Unit 2: 2 Weeks
Section B – Planning, Budgeting and Forecasting
Section B, Planning, Budgeting and Forecasting

Section B, Planning, Budgeting and Forecasting, constitutes 20% of the exam. It contains six
major topics:
B.1. Strategic Planning
B.2. Budgeting Concepts
B.3. Forecasting Techniques
B.4. Budget Methodologies
B.5. Annual Profit Plan and Supporting Schedules
B.6. Top-Level Planning and Analysis
B.1. Strategic Planning

Planning is the first activity that management must undertake when creating yearly budgets
and making other critical decisions that will affect the company’s future. A company’s plan
serves as its guide or compass for the activities performed and decisions made throughout
the entire organization. The planning process not only defines the company’s objectives and
goals, it sets the stage for prioritizing how to develop, communicate and carry out accom-
plishing them.
Strategic Planning is a theoretical discussion of planning. You will need to know the terms
and ideas, the different types of plans, and the steps in the strategic planning process.
Textbook Read the Introduction to Section B – Planning, Budgeting
Volume 1: and Forecasting and B.1. Strategic Planning and answer
the questions in the book.
Overview of Strategic Planning
Mission and Goals
Analyzing the External Environment
Analyzing the Internal Environment
Formulating Strategies
Developing and Implementing Strategies
Other Planning Tools
for:
Strategic Planning

Unit 2: 2 Weeks

Budgeting Concepts is another conceptual and theoretical discussion. You will need to know
the advantages of budgets and the uses for budgets as well as the general methods of de-
veloping budgets (participative, authoritative, and consultative) and the basic budget
development process. Standard costs are introduced in this topic. Setting standard costs is
important, as standard costs will be a theme you will encounter throughout your preparation
for the Part 1 exam.
Textbook Read the following topic and answer the questions in the book for:
Volume 1:
Planning to Budgeting
Budgeting Concepts
for:
Budgeting Concepts
B.3. Forecasting Techniques

Forecasting Techniques covers methods that can be used to develop budgeted amounts that
are based on premises, or assumptions, about the outlook for the environment in which the
company’s business operates. The topics covered include Regression Analysis, Learning
Curves, and Probability and their use in developing forecasts.
• Simple linear regression analysis used in time series trend projection for forecasting
and both simple linear regression analysis and multiple linear regression analysis
used in causal forecasting are covered.
• Learning curves describe the fact that the more experience people have with some-
thing, the more efficient they become in doing that task and the less time it requires.
Learning curves are used to develop forecasts and also for developing prices for bids.
You will need to know how to calculate the cost of units after learning has taken place
and the direct labor time required is reduced.
• Probability is a means of measuring numerically how likely it is that an event will
occur. Probability is used in forecasting and budgeting to create an expected value
for an element that needs to be forecasted, such as future cash flows. The concept
of expected value is important in probability and the term “expected value” has a
specific meaning. An expected value is a weighted average of the possible values,
weighted according to the probability assigned to each possible value. The probabili-
ties may be historical data, they may be the decision-maker’s subjective projections,
they may be a combination of both, or they may be based on any other available
information.
• The concepts of variance and standard deviation are introduced as a means of meas-
uring the variability that could take place in the actual results for the value being
forecasted.

Unit 2: 2 Weeks
Textbook In B.3. Forecasting Techniques, read the following topics and an-
Volume 1: swer the questions in the book for:
Using Regression Analysis in Forecasting
Using Learning Curves in Forecasting
Using Probability Concepts in Forecasting
Forecasting and Regression Analysis
Learning Curves
for:
Forecasting Techniques – Regression Analysis
Forecasting Techniques – Learning Curves
Forecasting Techniques – Probability

Budget Methodologies is an introduction to the various kinds of budgeting, including the an-
nual or master budget, static budgets versus flexible budgets, project budgeting, activity-
based budgeting, zero-based budgeting versus incremental budgeting, and continuous or
rolling budgets.
You will need to be able to calculate what the flexible budget would have been, given a master
budget and a certain level of actual activity (either sales or production). In this type of flexible
budget question, you will need to remember the following:
• As long as the company produces only one product, the flexible budget amounts for
variable revenues and costs are the budgeted amounts in the master (static) budget
divided by the budgeted volume in the master budget (to calculate the budgeted per
unit amounts), then the budgeted per unit amounts are multiplied by the actual vol-
ume experienced to calculate the flexible budget variable amounts.
• Total fixed costs do not change within the relevant range, and the question will be
within that range unless the question tells you differently. Thus, the budgeted fixed
costs will be the same in the master budget and in the flexible budget. If only the
budgeted fixed cost per unit is given, the total budgeted fixed costs for either the
master budget or the flexible budget can be calculated by multiplying the budgeted
fixed cost per unit in the master budget by the budgeted level of activity in the master
budget.
Volume 1:
Budget Methodologies
for:
Budget Methodologies

Unit 2: 2 Weeks

These topics cover the various individual budgets that together make up the master budget,
how they are developed, how they work together, and how information from one budget is
used in the next budget.
This part of Section B is numerical. You will need to be able to calculate how many units must
be purchased or produced during a period to meet budgeted sales. You will also need to be
able to calculate the amount of cash planned to be collected or paid during a period.
After the budgets are determined and approved, they should be used throughout the year to
measure the actual results as compared to the budgeted results, that is, for variance report-
ing. Variance reporting is introduced here and covered fully in Section C, Performance
Management.
Textbook Read the following topics and answer the questions in the book for:
Volume 1:
Answering Budgeting Exam Questions
Budget Cycle and Budgets Produced
Preparing Budgets
Ongoing Budget Reports
for:
Annual Profit Plan and Supporting Schedules
B.6. Top-Level Planning and Analysis

Top-Level Planning and Analysis discusses how to make use of planning and forecasting tech-
niques to develop pro forma financial statements for use in planning and decision-making.
Top-level planning makes extensive use of pro forma financial statements, and this topic
discusses what they are and illustrates how to construct them and analyze them for the
purpose of making decisions.
Textbook Read B.6. Top-Level Planning and Analysis.
Volume 1:
There are no questions on this topic in the book, but there are sev-
eral lengthy numerical examples. You should recalculate the
numbers in the examples to make sure you understand where they
came from.
Top-Level Planning and Analysis
for:
Top-Level Planning and Analysis

Unit 2: 2 Weeks
Section B Practice Essay Questions

Answer all of the essays in the Section B Essay Session in ExamSuccess Online.
Review of Section B
In addition to doing that, you should review specifically all the topics in Section B by answer-
ing at least 25 multiple-choice questions in ExamSuccess from the entire group of Section B,
Planning, Budgeting and Forecasting questions or by completing the Review Session available
in ExamSuccess Online.5
If you have chosen to create it Section by Section, now is the time to add to the sheet the
items you want to memorize for Section B.
Note: For candidates who have access to the Videos, the Final Review Video for Section B
is on the access page in My Studies in a separate location below the individual Section
videos.
Additional Periodic Review

HOCK recommends that you periodically review all of the topics you have studied to date by
using the Random MCQs from Sections A-B Review Session in ExamSuccess Online.
5

Unit 3: 2 Weeks
Section C – Performance Management
Section C, Performance Management

Section C, Performance Management, accounts for 20% of the exam, with three main topics:
C.1. Cost and Variance Measures (Variance Analysis)
C.2. Responsibility Centers and Reporting Segments
C.3. Performance Measures
C.1. Cost and Variance Measures

Cost and Variance Measures is a topic that causes trouble for many candidates, especially
those who have not studied it previously. Though the topic appears to have a lot of formulas
at first glance, it is really not as bad as it seems. The formulas are mostly just variations on
two basic formulas that are used for the different variances. You will need to be certain that
you can calculate the numerical formulas and that you also know what the variances mean,
how they are used and what can cause the variances. The word questions on this topic should
be easy if you understand what the variance is telling you.
The topics in the Cost and Variance Measures portion of Section C are:
1) Cost and Variance Measures
2) Variance Analysis Concepts
3) Manufacturing Input Variances
4) Sales Variances
5) Variance Analysis for a Service Company
6) Market Variances
Cost and Variance Measures and Variance Analysis Concepts

Cost and Variance Measures provides an introduction to standard costs. You will need to
understand the concept of standard costs and their use in controlling production. Variance
Analysis Concepts introduces variance analysis and goes into flexible budget variances versus
static budget variances. You need to know that the sales volume variance is the difference
between the flexible budget amount and the static budget amount on an income statement
variance report that presents sales variances.
Volume 1:
C.1. Cost and Variance Measures
Variance Analysis Concepts
Basis for Variance Analysis
Introduction to Variance Analysis
for:
Introduction to Variance Analysis and Standard Costs
Variance Analysis Concepts

Unit 3: 2 Weeks
Manufacturing Input Variances – Direct Materials and Direct Labor

Manufacturing input variances are concerned with inputs to the manufacturing process. Ma-
terials and labor variances focus on those direct inputs and:
• Whether the amount of inputs used per unit manufactured was over or under the
standard for the actual level of production,
• Whether the cost per unit of input used was more or less per unit than the standard,
and
• What the cost impact was of each type of variance.
Manufacturing input variances compare actual costs to what the costs should have been
for the actual level of production. Thus, manufacturing input variances are a type of
flexible budget variance. However, they are not the same thing as the flexible budget vari-
ance on an income statement variance report. Manufacturing input variances split the
production flexible budget variance between variance in cost due to the costs of inputs
used having differed from the standard costs, and variance in cost due to the quantity of
inputs used having differed from the standard quantity for the actual production.
Manufacturing input variances are used in controlling production. You will need to memorize
the two basic variance formulas, the price variance formula and the quantity variance
formula and know when and how to use them.
As you are reading this topic and the topics that follow it, recognize that manufacturing input
and factory overhead variances are very different from sales variances. Manufacturing input
and factory overhead variances deal with units produced and the cost of units produced.
Sales variances deal with units sold and the revenue from sales and the cost of units
sold. The variances based on units produced are not expected to reconcile with variances
based on units sold, because the units produced and the units sold will almost never be the
same. If you keep this basic difference in mind, it should help clarify the topics for you.
Textbook In Manufacturing Input Variances, read the following topics and
Volume 1: answer the questions in the book for:
The Difference Between Sales Variances and Production Vari-
ances
What Causes Manufacturing Input Variances?
Direct Materials Variances
Direct Labor Variances
Manufacturing Input Variances
for:
Manufacturing Input Variances-Direct Materials
Manufacturing Input Variances-Direct Labor

Unit 3: 2 Weeks
Manufacturing Input Variances – More Than One Material Input or One Labor Class
When more than one direct material input or more than one class of labor is used in producing
the product, the price and quantity variances are calculated a little differently and the quan-
tity variance is broken down into two sub-variances: the mix variance and the yield
variance.
• The mix variance shows the portion of the quantity variance that was caused by the
actual mix used having been different from the standard mix because more of one
ingredient was used and less of another ingredient was used.
• The yield variance shows the portion of the quantity variance that was caused by the
total actual amount of all ingredients used having been different from the total stand-
ard amount of all ingredients allowed for the actual production.
Textbook In Manufacturing Input Variances, read the following topic and
More than One Material Input or One Labor Class
Multiple Input Variances
for:
Manufacturing Input Variances-Multiple Input Classes
Manufacturing Input Variances – Factory Overhead

Factory overhead variances focus on manufacturing overhead, both variable and fixed. The
topic of overhead variances appears much more complicated than it is. Factory overhead is
applied to units as they are produced on the basis of a predetermined overhead application
rate and therefore the amount of overhead applied to each unit is an estimated amount.
Factory overhead variances are generally the differences between factory overhead costs
actually incurred and factory overhead applied to the units produced.
You will need to learn the formulas for the variable and fixed overhead variances and under-
stand how they are combined in the different methods of analysis, such as two-way, three-
way and four-way analysis.
Textbook In Manufacturing Input Variances, read the following topic and
Factory Overhead Variances
Overhead Variances
Overhead Example
for:
Manufacturing Input Variances–Overhead

Unit 3: 2 Weeks
Sales Variances, Variance Analysis for a Service Company, and Market Variances
Sales variances are used to explain the differences between actual and budgeted amounts of
revenue, variable costs, and contribution margin caused by differences between actual sales
results and planned or budgeted sales results. Sales variances are reported on a variance
report that looks like an income statement, and there are several examples in the book.
Sales variances are different from manufacturing input variances because they are related to
units sold, not units produced. The flexible budget variance on a sales variance report is, for
costs of units sold, a combination of the manufacturing input price and quantity variances for
the units sold during the period. These two production cost causes of a flexible budget vari-
ance cannot be separated on a sales variance report, because the planned costs and
quantities of inputs for the units sold are not reported on a sales variance report.
The flexible budget variance and the sales volume variance on a sales variance report are
calculated using the same basic formulas as the price and quantity variances used to evaluate
variances in manufacturing input costs. However, the variances that result do not have the
same meanings as the manufacturing input variances. The differences are:
• For the revenue line, the amounts used for “price” in the formulas for sales variances
are the actual and planned selling prices per unit. For the variable cost line or lines,
the amounts used for “price” in the formulas are the actual and planned variable costs
per unit. Furthermore, as mentioned above, the actual and planned variable costs
per unit incorporate both the price and quantity variances for the manufacturing in-
puts used to produce the goods that were sold.
• The “quantity” amounts in sales variances are actual and planned quantities of units
sold instead of actual and planned quantities of inputs used in production.
A sales variance report can be prepared for a service business, too, and the book has an
example of a variance report for a service business and some interpretation of the variances.
The sales quantity variance for the contribution margin can be broken down into a market
size variance and a market share variance to discover the cause or causes of the variance in
the total quantity sold in terms of market forces. The total level of sales may be different
from expected because (a) the market was bigger or smaller than expected (the market size
variance) or (b) because the company’s share of the market was bigger or smaller than
expected (the market share variance), or both.
Volume 1:
Sales Variances
Variance Analysis for a Service Company
Market Variances
Sales Variances
Service Companies and Market Variances
for:
Sales and Market Variances

Unit 3: 2 Weeks

Responsibility accounting involves assigning revenues and expenses to the various responsi-
bility centers within the organization according to which center is responsible for them. It
also involves allocating common costs such as the CEO’s salary among all the responsibility
centers on some reasonable basis. Responsibility reporting is reporting the actual revenues
earned and expenses incurred by each responsibility center. In addition, it includes comparing
each responsibility center’s actual revenues and expenses with its planned revenues and
expenses. The manager or other responsible party should explain the variances to the next
higher level in management.
The various responsibility centers within an organization can be classified according to type
(cost centers, revenue centers, profit centers and investment centers). You will need to know
what these classifications are, how they differ from one another, and how the managers of
each classification of centers and the centers are evaluated.
The information in this topic also stresses that a manager should not be evaluated on the
basis of something over which he or she has little, if any, control. To enable evaluation based
only on items that are controllable by the manager, a variation of a contribution income
statement should be used that shows segment manager performance (performance of the
manager) versus segment margin (performance of the segment). Costs that are controllable
by the manager are separated from costs that are not controllable by the manager.
• Segment manager performance is revenue less costs (both variable and fixed) that
are controllable by the manager.
• Segment manager performance less costs that are not controllable by the manager
but are traceable to that particular segment equals segment margin, or the perfor-
mance of the segment.
• Segment margin less uncontrollable and untraceable costs, that is, allocated common
costs, equals the segment’s operating income. You will need to know the various
steps in the contribution income statement that is used.
In the topic of Transfer Pricing, you should understand the effect of transfer prices on multi-
nationals’ segment profits and the evaluation of responsibility centers and their managers.
Volume 1:
Responsibility Centers
Contribution Income Statement
Transfer Pricing
for:
Responsibility Centers and Reporting Segments

Unit 3: 2 Weeks
C.3. Performance Measures

As part of Performance Measurement, you will need to be familiar with two calculations:
Return on Investment (ROI) and Residual Income (RI). You need to be able to calculate both
and also understand what they indicate and how to use them.
Volume 1:
C.3. Performance Measures through the end of Section C
Return on Investment and Residual Income
Multiple Performance Measures
for:
Performance Measures
Section C Practice Essay Questions

Answer all of the essays in the Section C Essay Session in ExamSuccess Online.

Unit 3: 2 Weeks
Review of Section C
In addition to doing that, you should review specifically all the topics in Section C by answer-
ing at least 25 multiple-choice questions from the entire group of Section C, Performance
Management questions or by completing the Review Session available in ExamSuccess
Online.6
items you want to memorize for Section C.
Note: For candidates who have access to the Videos, the Final Review Video for Section C
videos.

using the Random MCQs from Sections A-C Review Session in ExamSuccess Online.
6

Unit 4: 3 Weeks
Section D – Cost Management
Section D, Cost Management

Section D, Cost Management, is 15% of the exam and has five groupings of topics. How much
time you will need to spend on each topic will depend on your background and experience.
However, you should try to complete Section D in 30 hours.
D.1. Measurement Concepts
D.2. Costing Systems
D.3. Overhead Costs
D.4. Supply Chain Management
D.5. Business Process Improvement

Measurement Concepts includes classifications of costs (product costs, period costs, fixed,
variable, and mixed costs); an introduction to costing systems (cost measurement methods,
cost accumulation methods, and methods of allocating overhead); and the meaning and cal-
culation of cost of goods sold and cost of goods manufactured.
Cost measurement systems (standard costing, normal costing, and actual costing) are cov-
ered in detail in this topic. Cost accumulation methods (job costing, process costing, and
operation costing) are covered in detail in D.2., Costing Systems; and methods of allocating
overhead are covered in detail in D.3. Overhead Costs.
Classification of costs, especially fixed versus variable costs, is a topic that will be important
in several areas covered by the exam. You need to be comfortable with the way the different
costs behave. Product costs, period costs, prime costs, and conversion costs and what costs
are included in each of these cost classifications are also important. The exam will have word
questions about these costs, what they consist of and how they behave. If you have this
knowledge, you will be able to answer the exam questions easily and quickly.
Measurement concepts also covers variable and absorption costing and costing for joint prod-
ucts and byproducts.
Measurement Concepts
Volume 2:
Introduction to Section D – Cost Management
Classification of Costs
Costing Systems
for:
Classifications of Costs
Cost Measurement, COGS, and COGM

Unit 4: 3 Weeks
Variable and Absorption Costing

Variable costing and absorption costing are two different ways of presenting an income state-
ment. Variable costing and absorption costing differ in only one area. Under variable costing,
the fixed manufacturing overheads are expensed in the period that they are incurred. Under
absorption costing, those same fixed overhead costs are allocated to the units produced dur-
ing the period they were produced and are expensed as cost of goods sold only when those
units are sold. These two methods result in different levels of net income when inventory
changes during the period.
• If the inventory level increases during the period, use of absorption costing will result
in a higher net income than use of variable costing will because some of the fixed
manufacturing overheads incurred during the period remain on the balance sheet in
inventory at the end of the period.
• If the inventory level falls during the period, variable costing will result in a higher
net income because under the variable method, only fixed factory overheads incurred
during the year are included as an expense in the period. In contrast, under absorp-
tion costing, some of the fixed factory overhead costs that had been inventoried in
previous periods will be expensed in the current period. The result will be cost of
goods sold that will be higher than it would be under variable costing, because under
absorption costing, cost of goods sold will include some costs incurred during the
previous period when those units sold from inventory were produced, in addition to
costs incurred during the current period for units sold from the current period’s pro-
duction.
You will need to remember that the above is the only difference between the two methods
and be able to calculate the level of income under both methods. You should also be familiar
with the presentation of the income statement under both methods.
Absorption costing is required for external reporting under both U.S. GAAP and IFRS. Vari-
able costing can be used internally for analysis purposes, but it cannot be used for external
financial reporting because it is not in accordance with either U.S. GAAP or IFRS.
Volume 2:
ExamSuccess: Answer all the multiple-choice study questions in ExamSuccess:
Joint Products and Byproducts

When a single process is used in the preliminary stages of production of two or more finished
products, the costs of the single process need to be allocated between or among the joint
products. Byproducts are the low-value products that occur as a result of producing main
products, and their costs need to be allocated, either to the byproducts or to the main prod-
ucts.
The Net Realizable Value method is an important method used to allocate joint product and
byproduct costs. Net Realizable Value (NRV) and Estimated Net Realizable Value are im-
portant concepts when the Net Realizable Value method is being used, and they cause
problems for some candidates.

Unit 4: 3 Weeks
• If a product can be sold at the splitoff point, its Net Realizable Value at the splitoff
point is its sales price at the splitoff point.
• If a product cannot be sold at the splitoff point, its Estimated Net Realizable Value
is calculated based on the product’s future sales price minus its separable costs, and
that is used as its NRV.
In a single allocation of costs, you may have some products for which you will use sales price
at splitoff as their NRV and some products for which you will use Estimated Net Realizable
Value as their NRV.
Volume 2:
Joint Product Costing
Byproduct Costing
for:
D.2. Costing Systems

Costing Systems introduces product cost accumulation and accounting for product costs.
Methods of cost accumulation include job costing, process costing, and operation costing.
The topic opens with a discussion of the flow of manufacturing costs because an understand-
ing of that is basic to understanding costing systems and methods of cost accumulation.
Overhead allocation is also covered in this topic.
Process Costing
Process Costing is a topic that is often troublesome for candidates. To make it a little easier,
the textbook contains a seven-step process to help you complete a full process-costing ques-
tion.
In process costing, you need to be able to calculate the equivalent units of production (EUP)
for both materials costs and conversion costs. Even if you can’t do anything else in process
costing, make sure that you can calculate the equivalent units of production, as this will very
likely be tested. You also need to understand the difference between the FIFO and the
weighted average cost flow assumptions for work-in-process. The only difference is in the
treatment of beginning work-in-process inventory (BWIP) and the treatment of the costs in
BWIP.
The concept of spoilage, both normal and abnormal, is also covered. You must be able to
calculate the number of normally spoiled units and the number of abnormally spoiled units
based on the information given. However, if you have trouble with the allocation of costs to
the spoiled units, don’t be too worried because if this is tested, it will probably be only one,
maybe two, questions. In any case, the allocation of costs to the spoiled units is not a heavily
or commonly tested item.

Unit 4: 3 Weeks
Volume 2:
D.2. Costing Systems (Introduction)
Process Costing
Process Costing
Process Costing Example
Spoilage in Process Costing
for:
Process Costing
Job Order, Operation, and Life-Cycle Costing

Job order costing is used when the company has specific and identifiable jobs or projects that
are worked on during the period. Direct costs and overhead are allocated to individual jobs.
Operation costing is a hybrid, or combination, of job-order costing and process costing.
Life-cycle costing takes a much longer-term view than just the cost of production and is used
to allocate to each product all of the research and development, marketing, after-sale service
and support costs and any other cost that is associated with the product during its life cycle.
Life-cycle costing is used internally only, for analysis purposes. It is not a method of costing
that results in amounts being recorded in the company’s general ledger.
Volume 2:
Job-Order Costing
Operation Costing
Life-Cycle Costing
Customer Life-Cycle Costing
Job Order, Operation and Life-Cycle Costing
for:
Job Order, Operation, and Life-Cycle Costing
D.3. Overhead Costs

For the topic of overhead cost allocation, you will need to make certain that you understand
the method of setting standard costs and the allocation of overhead to the individual units.
Also, spend some time ensuring that you can quickly identify over- or under-applied overhead
for the company and the treatment for this amount.

Unit 4: 3 Weeks
Traditional Overhead Allocation

Textbook In D.3. Overhead Costs, read the following topics and answer the
Volume 2: questions in the book for:
Introduction to Accounting for Overhead Costs
Traditional (Standard) Allocation Method
Accounting for Overhead
Overhead Allocation
for:
Traditional Overhead Allocation
Activity-Based Costing
Activity-Based Costing (ABC) is an alternative to the traditional method of allocating overhead
to units produced. In the traditional method, the total overhead is allocated on the basis of
a single cost driver that is volume-based such as number of units produced, number of direct
labor hours used, or number of machine hours used. In Activity-Based Costing, total manu-
facturing overhead is classified into multiple cost pools according to type of cost, and each
cost pool is allocated separately to units or jobs using an individual cost driver based on
cause-and-effect criteria for that type of cost.
A numerical ABC question may require you to compare the results of an ABC overhead allo-
cation to the results of a traditional overhead allocation. You will be given instructions about
the cost driver to use under the traditional method, and the ABC method is nothing more
than applying the traditional method three or four times to the same data using different cost
drivers for different cost pools. However, for the ABC part of the question, you may need to
classify the types of costs into cost pools and determine the most appropriate cost driver for
each cost pool from among those given. You will also need to be certain to understand the
idea behind ABC, the related terminology and its benefits.
Textbook In D.3. Overhead Costs, read the following topic and answer the
for:

Unit 4: 3 Weeks
Shared Services Cost Allocation

Shared services cost allocation is used to allocate the costs of departments not involved in
production (service and support departments) to non-production departments and/or pro-
duction departments and individual products. There are several methods of allocating shared
services costs when the company has more than one service department. The allocations are
largely mathematical processes and you will need to be able to make the allocations under
all the methods. You will also need to understand how these methods treat the costs of
services provided to other service departments when the company has more than one service
department.
Like variable cost financial statements, allocation of shared services department costs to
production departments and individual products is used strictly for internal analysis. For ex-
ternal reporting purposes, costs of shared services departments are period costs and are
expensed as they are incurred.
Textbook In D.3. Overhead Costs, read the following topics and answer the
Allocating Costs of a Single (One) Service or Support Depart-
ment to Multiple Users
Allocating Costs of Multiple Shared Service Departments
Single Shared Service Cost Allocation
Multiple Shared Services Cost Allocation
Multiple Shared Services Cost Allocation Example
for:
Estimating Fixed and Variable Costs

Sometimes costs are mixed costs or the fixed costs are not segregated from the variable
costs in the historical information available. Because of the difference in the way fixed and
variable costs behave, it is necessary to be able to segregate costs into their fixed and vari-
able components for forecasting or allocation purposes. Estimating Fixed and Variable Costs
discusses two ways of doing that: The High-Low Points Method and Regression Analysis.
Volume 2:
Videos/Audios: There are no videos/audios on the topic of Estimating Fixed and Var-
iable Costs.
for:

Unit 4: 3 Weeks
D.4. Supply Chain Management

Supply chain management is the active management of supply chain activities by the mem-
bers of a supply chain with the goals of maximizing customer value and achieving a
sustainable competitive advantage. The goal of supply chain management is to eliminate
waste and streamline operations in order to give customers what they want, when they want
it, in the least amount of time and at the lowest possible cost.
Systems such as lean resource management, Just-in-Time (JIT) manufacturing and inventory
management, kanban, Theory of Constraints (TOC), and integrated information systems such
as Material Requirements Planning (MRP), Manufacturing Resource Planning (MRPII), and
Enterprise Resource Planning (ERP) are all methods that are used to achieve the goals of
supply chain management.
Capacity level used and its effect on management decisions and the financial statements is
also covered in this topic.
Volume 2:
D.4 Supply Chain Management
Supply Chain and Lean Resource Management
Just-In-Time Inventory and MRP
Theory of Constraints
Capacity Level and Decision Making
for:
Supply Chain Management
D.5. Business Process Improvement

Business Process Improvement covers the concepts of the value chain and value chain anal-
ysis, business process reengineering, benchmarking, activity-based management, kaizen,
quality and the costs of quality, Total Quality Management (TQM), several statistical methods
of tracking quality, and accounting process redesign.
Volume 2:
D.5 Business Process Improvement
Value Chain Analysis
Process Analysis
Quality
Accounting Process Redesign
for:
Business Process Improvement

Unit 4: 3 Weeks
Section D Practice Essay Questions

Answer all of the essays in the Section D Essay Session in ExamSuccess Online.
Review of Section D
In addition to doing that, you should review specifically all the topics in Section D by answer-
ing at least 25 multiple-choice questions in ExamSuccess from the entire group of Section D,
Cost Management questions and/or by completing the Review Session available in Exam-
Success Online.7
items you want to memorize for Section D.
Note: For candidates who have access to the Videos, the Final Review Video for Section D
videos.

using the Random MCQs from Sections A-D Review Session in ExamSuccess Online.
7

Unit 5: 2 Weeks
Section E – Internal Controls
Section E, Internal Controls

Section E, Internal Controls is not a numerical Section. Rather, it is a theoretical Section that
relates to internal controls and internal audit. This Section is 15% of the exam.
The Section has two main topics:
E.1. Governance, Risk, and Compliance and Internal Control
E.2. Systems Controls and Security Measures
E.1. Governance, Risk, Compliance, and Internal Control

Good corporate governance is basic to internal control, and this Section begins with a discus-
sion of what corporate governance is, why it is important, and how it is related to risk
assessment, internal control, and risk management. Principles of good corporate governance
and responsibilities of the board of directors, the audit committee, and the chief executive
officer are all important to know.
Internal Control covers the basics of internal control as set forth in the COSO document,
Internal Control – Integrated Framework (revised 2013). Corporate governance is discussed
as well as legislative initiatives that impact companies’ internal control processes. In partic-
ular, the PCAOB’s Auditing Standard No. 5 for auditing internal controls is discussed in depth.
You need to make certain that you understand the concept of segregation of duties. You will
probably need to know it from both a theoretical standpoint as well as in application. The
application questions are difficult to prepare for because there are so many possible situations
that can be created. If you get a question that asks who should not do what two jobs or
something similar, make a best assessment of the question, answer it and move on. If you
think additional time considering it would be useful, you can mark the answer and come back
to it later, but do not spend a great deal of time on this type of question.

Unit 5: 2 Weeks
Textbook Read the Introduction to Section E – Internal Controls

Volume 2:
In E.1. Governance, Risk, and Compliance, read the following
topics:
Corporate Governance
Responsibilities of the Board of Directors
Audit Committee Requirements, Responsibilities and Authority
Responsibilities of the Chief Executive officer (CEO)
Election of Directors
In Internal Control, read the following topics and answer the ques-
tions in the book for:
Internal Control Definition
The Importance of Objectives
Who is Responsible for Internal Control?
Components of Internal Control
What is Effective Internal Control?
Governance Principles
Hierarchy of Corporate Governance
Introduction to Internal Controls
Components of Internal Control
for:
Governance, Introduction to Internal Control
Transaction Control Activities and Safeguarding Controls

Textbook In Internal Control, read the following topics and answer the ques-
Volume 2: tions in the book for:
Transaction Control Objectives
Types of Transaction Control Activities
Safeguarding Controls
Transaction and Safeguarding Controls
for:
Transaction Controls
Safeguarding Controls

Unit 5: 2 Weeks
Legislative Initiatives About Internal Control, External Auditors’ Responsibilities and Re-
ports
Volume 2:
Legislative Initiatives About Internal Control
External Auditors’ Responsibilities and Reports
Foreign Corrupt Practices Act and Sarbanes-Oxley
External Audit Opinions
for:
Legislation and External Audit

Systems Controls and Security Measures covers internal control issues related to computer
systems. This topic discusses the unique control challenges in computer data processing and
means of addressing them. Internet security and contingency planning are also included in
this topic. You need to be familiar with the specific terminology and issues of information
systems.
Introduction to Systems Controls, General Controls

Volume 2:
System and Program Development and Change Controls
Systems Controls
for:
System General Controls
System Application Controls
Internet Security and Cybercrime

Volume 2:
Internet Security
Internet Security
for:
Internet Security and Cybercrime

Unit 5: 2 Weeks
Business Continuity Planning and System Auditing

Volume 2:
Business Continuity Planning
System Auditing
Computerized Audit Techniques
for:
Business Continuity and System Auditing
Section E Practice Essay Questions

Answer all of the essays in the Section E Essay Session in ExamSuccess Online.
Review of Section E
In addition to doing that, you should review specifically all the topics in Section E by answer-
ing at least 25 multiple-choice questions in ExamSuccess from the entire group of Section E,
Internal Controls questions and/or by completing the Review Session available in Exam-
Success Online.8
items you want to memorize for Section E.
Note: For candidates who have access to the Videos, the Final Review Video for Section E
videos.

using the Random MCQs from Sections A-E Review Session in ExamSuccess Online.
8

Unit 6: 2 Weeks
Section F – Technology and Analytics
Section F, Technology and Analytics

Section F, Technology and Analytics, represents 15% of the CMA Part 1 exam and has four
main topics:
F.1. Information Systems
F.2. Data Governance
F.3. Technology-enabled Finance Transformation
F.4. Data Analytics
Technology and analytics are important areas for management accountants to be aware of.
Future success in financial endeavors will depend on an understanding of the concepts, so
this is an important section.

Information Systems focuses on accounting information systems (AIS), inputs to an AIS, and
use of the outputs from an AIS. Data storage, ERP systems, and enterprise performance
management systems are also important topics.
Textbook Read the following topics in the book:
Volume 2:
Introduction to Section F – Technology and Analytics
Information Systems
Introduction to Transactions Cycles
Revenue to Cash Cycle
Purchasing and Expenditures Cycle
Production Cycle
Human Resources and Payroll Cycle
Financing Cycle
Fixed Assets Cycle
General Ledger and Reporting Systems
Databases
Enterprise Resource Management
Data Warehouse, Data Mart, and Data Lake
for:
Information Systems

Unit 6: 2 Weeks

Data governance is similar to corporate governance, but it is specific to data and information
technology. It involves all the practices, procedures, processes, methods, technologies, and
activities dealing with the overall management and control of an organization’s data assets
and data flows. The objective of data governance is to maintain reliable and consistent data
so that management can properly assess the organization’s performance and make decisions.
Volume 2:
Data Governance
Data Life Cycle and Records Management
Cyberattacks
Defenses Against Cyberattacks
for:
Data Governance

Technology-enabled Finance Transformation includes several topics:
• Systems Development Life Cycle (SDLC) entails controls over the development pro-
cess of systems.
• Business Process Analysis is used in reengineering or redesigning business processes
and developing the information systems needed to support the newly designed pro-
cess.
• Robotic Process Automation (RPA) is an aspect of artificial intelligence that is used to
automate repetitive tasks by interacting with other IT applications to execute busi-
ness processes automatically.
• Artificial intelligence is used to create intelligent machines that can simulate human
intelligence processes using algorithms, which are step-by-step instructions that a
computer can execute to perform a task, and applications that can learn from data
and self-correct.
• Cloud computing is a way to increase IT capacity and add capability without investing
in new infrastructure or licensing new software.
• Blockchains, distributed ledgers, and smart contracts are a group of topics under the
rubric of blockchain technology. A blockchain is a peer-to-peer online system used
for sending payments in cryptocurrency and for various other purposes.

Unit 6: 2 Weeks

Volume 2:
Technology-enabled Finance Transformation
Artificial Intelligence
Cloud Computing
Blockchain and Smart Contracts
for:
Technology-enabled Finance Transformation
F.4. Data Analytics

Data Analytics involves gathering and analyzing data to produce meaningful information that
can be used in decision-making. It includes business intelligence; data mining; analytic tools
such as regression analysis, correlation analysis, and sensitivity analysis; and data visualiza-
tion.
Volume 2:
F.4. Data Analytics
Business Intelligence
Data Mining
Regression Analysis
Sensitivity Analysis
Visualization
for:
Data Analytics

Unit 6: 2 Weeks
Review of Section F
In addition to doing that, you should review specifically all the topics in Section F by answer-
ing at least 25 multiple-choice questions in ExamSuccess from the entire group of Section F,
Technology and Analytics questions and/or by completing the Review Session available in
ExamSuccess Online.9
items you want to memorize for Section E.

using the Random MCQs from Sections A-F Review Session in ExamSuccess Online.
9

Unit 7: 3 Weeks
Review
Comprehensive Review
If you have chosen to create a study sheet after you have completed all the Sections rather
than as you were going through each one, now is the time to do it. You will want to keep it
handy during the last couple of weeks before your exam so you can review it again and again.
You should also at least skim through the entire material one more time. While doing this,
you won’t want to focus on any individual idea or topic or try to memorize the formulas.
Simply make certain that you are familiar with all of the topics, both large and small, and
refresh your memory as to the key terms and ideas.
After you skim through the materials, you will want to focus on the main topics that are
identified in the Section Overviews in this Study Plan.
If you have the flash cards and have not been using them up to this point, now is a good
time to use them. The flash cards do not cover every detail in the materials, but they do
address the main topics, definitions, and formulas that are most likely to be tested. Use the
flash cards whenever you can, even if it is for only a few minutes. The flash cards are provided
in PowerPoint format, and instructions for using them are provided with the flash cards.
During the final week or two before your exam, create several Part 1 Practice Exams in
ExamSuccess Online10 or Exams in the HOCK CMA Prep mobile app by Appitur®. Each prac-
tice exam will contain 100 multiple-choice questions selected randomly from the entire
question base in approximately the same distribution as the distribution of the questions on
the actual exam and will be timed for 3 hours. You can use these sessions to continue to
refine your time management and look for any weak areas that you need to study. Be sure
to use the questions that you miss as another learning opportunity.
You also have access to two mock exams with new questions in ExamSuccess Online, which
you can take after you have completed your review. Like the real exam, the mock exams
contain 100 multiple-choice questions and 2 essay scenarios, each with several questions,
and you will not get immediate feedback about whether your answer is correct or not. Set
aside 4 hours without interruption to complete each mock exam so you can become accus-
tomed to sitting for 4 hours in one place. When you have completed the mock exams, use
them as another study tool. Look up in your book the topics where missed questions, and
then try answering those questions again.
After you have completed the two mock exams, you can use the Part 1 Practice Exam to
continue reviewing questions from all of the topics in Part 1. Keep in mind that you don’t
need to do this too many times, and eventually the questions will become familiar because
the questions are drawn randomly from the whole question database.
Note: The multiple-choice questions on the real exam will not be organized according to
Section. The questions will be presented on all the topics randomly.
If you have not done so already, refer to the HOCK’s Exam Tips document for some tips you
can use on exam day.
10
registration fee in the event you fail the exam, one of the requirements is that you pass one mock exam with a 70%
score (first attempt only) or two whole-Part review sessions with an 80% score (multiple attempts allowed). Exam-
Success Online must be used to fulfill this requirement.

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Dear CMA Part 1 Candidate,

Brian Hock, CMA, CIA

HOCK international ¨ www.hockinternational.com ¨ 1-866-807-4625 ¨ 1-281-652-5768

How to Use Your HOCK Study Materials

www.hockinternational.com ¨ support@hockinternational.com ¨ 1-281-652-5768 ¨ Page 1

How to Use the HOCK Textbook

How to Use the HOCK Flash Cards

How to Use the HOCK Videos

www.hockinternational.com ¨ support@hockinternational.com ¨ 1-281-652-5768 ¨ Page 2

How to Use ExamSuccess Multiple-Choice Questions

Note: It is very important to answer the multiple-choice questions in ExamSuccess as

Using ExamSuccess Online

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www.hockinternational.com ¨ support@hockinternational.com ¨ 1-281-652-5768 ¨ Page 4

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Using ExamSuccess in the HOCK CMA Prep Mobile App by Appitur®

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How to Use the Essay Questions

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How to Use the Mock Exams

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Textbook and Other Study Materials

Alignment with the ICMA’s Learning Outcome Statements

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Section A, External Financial Reporting Decisions

A.1. Financial Statements

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ExamSuccess: Answer all of the multiple-choice study questions in ExamSuccess

Financial Statements II – Preparation of the Statement of Cash Flows

Financial Statements III – Integrated Reporting

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A.2. Recognition, Measurement, Valuation and Disclosure

Investments and Long-Term Assets

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Liabilities and Income Taxes

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Revenue Recognition and Income Measurement and US GAAP/IFRS Differences

Section A Practice Essay Questions

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Section B, Planning, Budgeting and Forecasting

B.1. Strategic Planning

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B.2. Budgeting Concepts

B.3. Forecasting Techniques

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B.4. Budget Methodologies

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B.5. Annual Profit Plan and Supporting Schedules

B.6. Top-Level Planning and Analysis

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Section B Practice Essay Questions

Additional Periodic Review

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Section C, Performance Management

C.1. Cost and Variance Measures

Cost and Variance Measures and Variance Analysis Concepts

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