CMA Exam Practice Question #1


” If you are not willing to risk the usual you will have to settle for the ordinary.” Jim Rohn Question: A motorcycle company has the maintenance policy of replacing the tires of its 250 motorcycle fleet as the tires wear out. Top management wonders if they could save costs by changing the tires periodically at one time on its … Read More

How to Prepare for the Essay Questions

“Let no feeling of discouragement prey upon you, and in the end you are sure to succeed.”  Abraham Lincoln The essay portion of the exams are worrisome to many CMA candidates, and this is for good reason. The essay questions consist of written and quantitative analysis and responses. Because of this, all CMA candidates should be well versed in word … Read More

Financial Ratios Series – Liquidity Ratios Part 4

“In the midst of movement and chaos, keep stillness inside you.” Deepak Chopra Cash Ratio The cash ratio the most conservative ratio than the current and quick ratios. To calculate it, we take the sum of cash & equivalents and marketable securities, and divide it by total current assets. As you have probably guessed it, this ratio indicates a company’s … Read More

Financial Ratios Series – Liquidity Ratios Part 3

Financial Ratios Series Liquidity Ratios Part 3

“Go to bed a little wiser than when you woke up.” Charlie Munger Quick/Acid Test Ratio The quick ratio, or also known as acid test ratio, is very similar to the current ratio. The main difference is that it is a more conservative ratio. It means that instead of looking at all the current assets of a company, we look … Read More

Financial Ratios Series – Liquidity Ratios Part 2

“Change your thoughts and you change your world.” Norman Vincent Peale Current Ratio The first ratio we’ll look at is the Current Ratio. This ratio measures the amount of current assets in a company that are available to pay for its current liabilities. If you recall from part 1, current assets are the type that can be converted into cash … Read More