Certified Management Accountant Exam Part One QUESTIONS WITH COMPLETE SOLUTIONS

Initial entry for installment method Correct Answer: Cash (down pmt) Installment Receivable (yr 1 pmt) Cost of Installment sales (cost) *********Inventory (cost) *********Installment Sales (total) Installment Year End for receivables Correct Answer: Installment Sales (total) ******Cost of Installment sales (cost) ****** Deferred GP (Total-cost) deferred GP year 1 (GP%*amount paid) ******Realized GP ***GP %= (total-cost)/total Cost recovery method Year One for receivables Correct Answer: Receivable (total) Inventory (cost) Deferred GP (difference) Cash (paid) Receivable Cost Recovery Year two for receivables Correct Answer: cash (yr 2 pmt) deferred GP (cumulative amt over cost collected to be realized as GP) ********Receivable (amt paid) ******** Realized GP (same as above) Uncollectable: Deferred GP *********Recievable % of completion method long term construction Correct Answer: YR1: Construction in progress (cost incurred YR1) *****Cash Construction in Progress ** *******Construction GP **(cost yr 1/total expected cost)Total GP Last Year of project: Construction in progress (cost incurred