CPCM Management 1 Exam Questions
with Answers
Financial analysis - Answer-An assessment of the viability, stability, and profitability of a
business
Gross profit - Answer-Subtotal of total revenue made during an accounting period,
minus any returns or discounts and the costs of goods sold, before deducting operating
expenses
Income statement - Answer-A report that shows how much revenue a company earned
over a specific time period, and the costs and expenses associated with earning that
revenue
Information science - Answer-The field concerned with collecting, organizing, storing,
retrieving, and protecting recorded data
Intangible assets - Answer-Assets whose value comes from a legal claim or additional
earning power from a business transaction, such as goodwill, patents, or trademarks
Job-order cost system - Answer-An accounting system under which the company
accounts for output by identifying specific physical units; the costs for each job or
contract are accumulated under separate job orders
Latency - Answer-The delay between when a cost is incurred and when that cost
appears in the accounting system
Liability - Answer-An amount of money owed by a company to another; may require a
specific sum of money paid to a particular party at a specified time, or may be indefinite
Long-term - Answer-Long-term assets are assets that a business cannot easily turn into
cash and that are not used within one year; long-term liabilities are liabilities that will
mature over one year from the balance sheet date
Monopoly - Answer-A type of competition that exists when there is only one company in
the marketplace and it has no competitors
Accounting - Answer-The way an organization collects- organizes- and records financial
information for making management decisions; the way to report a company's
transactions and to maintain accountability for its assets and liabilities
, Accounting system - Answer-A formal communications network that supplies relevant
information for planning- control- decision-making- and evaluation,
Acid test ratio - Answer-The ratio determining how well the company's current liabilities
can be satisfied by its current assets less inventory,
Activity-based costing system - Answer-An accounting system focused on a production
cycle and based on the principles that an output needs activities to produce it and that
those activities use certain resources; assigns costs through cost drivers that the
activities use to create the outputs,
Administrative lead time - Answer-A measurement used by some organizations of how
long it takes to award a contract- starting when a procurement request is received and
ending when the contract is awarded,
Generally Accepted Accounting Principles (GAAP) - Answer-A set of uniform accounting
rules for assigning and measuring contract data to accurately represent an
organization's financial condition; nonregulatory guidance developed and used by
certified public accountants
Asset - Answer-Something a company owns that has value and that can be sold or
used by the company to make products or provide services that can be sold,
Balance sheet - Answer-Provides detailed information about a company's assets-
liabilities- and shareholder equity,
Bottom line - Answer-A company's total earnings or losses over a specific time period-
after accounting for costs and expenses; also called net income,
Burn rate - Answer-An average of the estimated costs per month- often based on
staffing estimates- used for estimating funding requirements,
Cash flow statement - Answer-A statement reporting a company's inflow and outflow of
cash; generally includes operating activities- investing activities- and financing activities,
Competition - Answer-The effort or action of two or more commercial companies to
obtain the same business from a third party
Contingency planning - Answer-Involves "what if?" analysis to look at various situations
if certain environmental or economic conditions change
Controlling - Answer-Monitoring and evaluating how well the team and organizational
objectives are pursued and accomplished
Current - Answer-Current assets are assets which can be converted into cash within
one year; current liabilities are obligations that a business must pay within one year
with Answers
Financial analysis - Answer-An assessment of the viability, stability, and profitability of a
business
Gross profit - Answer-Subtotal of total revenue made during an accounting period,
minus any returns or discounts and the costs of goods sold, before deducting operating
expenses
Income statement - Answer-A report that shows how much revenue a company earned
over a specific time period, and the costs and expenses associated with earning that
revenue
Information science - Answer-The field concerned with collecting, organizing, storing,
retrieving, and protecting recorded data
Intangible assets - Answer-Assets whose value comes from a legal claim or additional
earning power from a business transaction, such as goodwill, patents, or trademarks
Job-order cost system - Answer-An accounting system under which the company
accounts for output by identifying specific physical units; the costs for each job or
contract are accumulated under separate job orders
Latency - Answer-The delay between when a cost is incurred and when that cost
appears in the accounting system
Liability - Answer-An amount of money owed by a company to another; may require a
specific sum of money paid to a particular party at a specified time, or may be indefinite
Long-term - Answer-Long-term assets are assets that a business cannot easily turn into
cash and that are not used within one year; long-term liabilities are liabilities that will
mature over one year from the balance sheet date
Monopoly - Answer-A type of competition that exists when there is only one company in
the marketplace and it has no competitors
Accounting - Answer-The way an organization collects- organizes- and records financial
information for making management decisions; the way to report a company's
transactions and to maintain accountability for its assets and liabilities
, Accounting system - Answer-A formal communications network that supplies relevant
information for planning- control- decision-making- and evaluation,
Acid test ratio - Answer-The ratio determining how well the company's current liabilities
can be satisfied by its current assets less inventory,
Activity-based costing system - Answer-An accounting system focused on a production
cycle and based on the principles that an output needs activities to produce it and that
those activities use certain resources; assigns costs through cost drivers that the
activities use to create the outputs,
Administrative lead time - Answer-A measurement used by some organizations of how
long it takes to award a contract- starting when a procurement request is received and
ending when the contract is awarded,
Generally Accepted Accounting Principles (GAAP) - Answer-A set of uniform accounting
rules for assigning and measuring contract data to accurately represent an
organization's financial condition; nonregulatory guidance developed and used by
certified public accountants
Asset - Answer-Something a company owns that has value and that can be sold or
used by the company to make products or provide services that can be sold,
Balance sheet - Answer-Provides detailed information about a company's assets-
liabilities- and shareholder equity,
Bottom line - Answer-A company's total earnings or losses over a specific time period-
after accounting for costs and expenses; also called net income,
Burn rate - Answer-An average of the estimated costs per month- often based on
staffing estimates- used for estimating funding requirements,
Cash flow statement - Answer-A statement reporting a company's inflow and outflow of
cash; generally includes operating activities- investing activities- and financing activities,
Competition - Answer-The effort or action of two or more commercial companies to
obtain the same business from a third party
Contingency planning - Answer-Involves "what if?" analysis to look at various situations
if certain environmental or economic conditions change
Controlling - Answer-Monitoring and evaluating how well the team and organizational
objectives are pursued and accomplished
Current - Answer-Current assets are assets which can be converted into cash within
one year; current liabilities are obligations that a business must pay within one year
