Candidates must be able to differentiate between the major costing systems. is used for customized products, while process costing is for homogeneous goods produced in mass quantities. A significant focus is placed on Activity-Based Costing (ABC) , which assigns overhead to specific activities based on their use of resources, providing a more accurate product cost compared to traditional methods.
Mastering CMA Part 1: Deep Dive into Volume 2, Sections D (Cost Management) and E (Internal Controls) cma part 1 volume 2 sections d e
: These focus on managing a product's costs from design through disposal to ensure long-term profitability. 2. Overhead Allocation Candidates must be able to differentiate between the
Different industries require different methods to assign costs to products or services. The CMA exam heavily tests your ability to distinguish between and calculate costs using these systems: Mastering CMA Part 1: Deep Dive into Volume
Direct costs (e.g., raw materials, direct labor) can be easily traced to a cost object. Indirect costs (e.g., factory rent, supervisor salaries) cannot be easily traced and must be allocated.
You'll learn the different types of controls used to manage risk, including:
Understand when to use Job Order Costing (for custom products) versus Process Costing (for mass production).