100+ Free CMA Foundation Paper 2 (FFCA) Practice Questions

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2026 Statistics

Key Facts: CMA Foundation Paper 2 (FFCA) Exam

100

Marks in the Paper

ICMAI Syllabus 2022

2 hours

Exam Duration

ICMAI Syllabus 2022

70% / 30%

Financial vs Cost Accounting

ICMAI Foundation Syllabus 2022

Negative Marking

ICMAI Foundation Pattern

40% / 50%

Pass: Paper / Aggregate

ICMAI Examination Rules

ICMAI CMA Foundation Paper 2, Fundamentals of Financial and Cost Accounting (FFCA), is an offline objective paper of 100 marks over 2 hours with no negative marking under Syllabus 2022. Section A, Fundamentals of Financial Accounting, carries 70% (accounting fundamentals 30%, accounting for special transactions 15%, preparation of final accounts 25%), and Section B, Fundamentals of Cost Accounting, carries 30%. To pass, candidates need 40% in the paper and 50% aggregate across all four Foundation papers.

Sample CMA Foundation Paper 2 (FFCA) Practice Questions

Try these sample questions to test your CMA Foundation Paper 2 (FFCA) exam readiness. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.

1Under the dual aspect concept of accounting, every business transaction affects:

A.Only the profit and loss account

B.Only nominal accounts

C.Only one account

D.At least two accounts with equal debit and credit

Explanation: The dual aspect concept is the foundation of the double-entry system: every transaction has two aspects of equal value, recorded as a debit in one account and a credit in another, keeping the accounting equation (Assets = Liabilities + Capital) balanced.

2The accounting equation is best expressed as:

A.Assets = Liabilities − Capital

B.Capital = Assets + Liabilities

C.Assets = Capital + Liabilities

D.Liabilities = Assets + Capital

Explanation: The accounting equation states Assets = Capital + Liabilities (equivalently, Capital = Assets − Liabilities). It reflects that a firm's resources (assets) are financed by owners' funds (capital) and outsiders' funds (liabilities).

3The convention that requires anticipating no profit but providing for all possible losses is known as:

A.Materiality

B.Conservatism (prudence)

C.Full disclosure

D.Consistency

Explanation: The convention of conservatism (prudence) directs accountants not to anticipate profits but to provide for all probable losses, e.g., by creating a provision for doubtful debts and valuing stock at lower of cost or net realisable value.

4Purchase of a delivery van for use in the business is an example of:

A.Capital expenditure

B.Deferred revenue expenditure

C.Revenue receipt

D.Revenue expenditure

Explanation: Buying a delivery van creates a long-term asset that yields benefit over several years, so it is capital expenditure shown on the balance sheet, not charged fully to the profit and loss account in one period.

5According to the golden rule for nominal accounts under the traditional (British) approach, you debit:

A.All incomes and gains

B.The receiver

C.What comes in

D.All expenses and losses

Explanation: For nominal accounts the rule is: debit all expenses and losses, credit all incomes and gains. 'Debit the receiver' applies to personal accounts and 'debit what comes in' applies to real accounts.

6A trader sells goods on credit to Ram for Rs.5,000. Which journal entry is correct?

A.Ram Dr 5,000; To Cash A/c 5,000

B.Sales A/c Dr 5,000; To Ram 5,000

C.Ram Dr 5,000; To Sales A/c 5,000

D.Cash A/c Dr 5,000; To Sales A/c 5,000

Explanation: On a credit sale, the debtor (Ram) is debited because he is the receiver of goods and owes money, and Sales A/c is credited as income. No cash is involved at the point of a credit sale.

7Which of the following is a subsidiary book used to record only credit purchases of goods?

A.Sales book

B.Purchases book

C.Cash book

D.Journal proper

Explanation: The purchases book (purchases day book) records only credit purchases of goods meant for resale. Cash purchases go in the cash book, and credit sales go in the sales book.

8A petty cash book maintained on the imprest system means that:

A.The petty cashier is reimbursed the exact amount spent during the period

B.The petty cashier keeps a fixed unlimited balance

C.No record of petty payments is kept

D.The petty cashier passes all entries to the main cash book directly

Explanation: Under the imprest system the petty cashier starts with a fixed float, and at period-end is reimbursed exactly the amount spent, restoring the float to its original fixed level. This keeps control over small payments.

9In a three-column cash book, a contra entry arises when:

A.Goods are purchased for cash

B.Discount is allowed to a customer

C.Cash is paid to a creditor

D.Cash is deposited into the bank from office cash

Explanation: A contra entry affects both cash and bank columns of the same cash book, such as depositing office cash into the bank. It is marked with 'C' in the L.F. column because no separate ledger posting is needed.

10A bank reconciliation statement is prepared to reconcile the differences between:

A.The cash column and bank column of the cash book

B.Two different bank accounts

C.The cash book bank balance and the pass book balance

D.The trial balance and the balance sheet

Explanation: A bank reconciliation statement explains the difference between the bank balance per the cash book and the balance per the bank pass book (bank statement), caused by timing items like cheques issued but not presented or cheques deposited but not yet credited.

About the CMA Foundation Paper 2 (FFCA) Exam

CMA Foundation Paper 2 (FFCA) is the financial and cost accounting paper of the ICMAI Foundation course under Syllabus 2022. It tests fundamentals of financial accounting (70%) and fundamentals of cost accounting (30%) through an objective, 100-mark paper with no negative marking.

Assessment

Question count not published by the exam provider

Time Limit

2 hours (120 minutes)

Passing Score

40% in the paper and 50% in aggregate across the four Foundation papers

Exam Fee

Covered by the ICMAI Foundation course and examination fees; Paper 2 is not charged separately (The Institute of Cost Accountants of India (ICMAI))

CMA Foundation Paper 2 (FFCA) Exam Content Outline

30%

Accounting Fundamentals

Accounting concepts, principles and conventions, capital and revenue items, double-entry system, journal and ledger, subsidiary books, cash and petty cash book, bank reconciliation, trial balance, rectification of errors, depreciation (straight-line and diminishing-balance), and bad debts.

15%

Accounting for Special Transactions

Consignment accounting (loading on invoice price, valuation of unsold stock, account sales, del credere commission), joint venture accounting, and bills of exchange (acceptance, due date, discounting, dishonour, and renewal).

25%

Preparation of Final Accounts

Trading and profit and loss account and balance sheet of a sole proprietor with adjustments, and receipts and payments account, income and expenditure account, and balance sheet of not-for-profit organisations.

30%

Fundamentals of Cost Accounting

Meaning and significance of cost accounting and its relationship with financial accounting, cost concepts (cost, cost centre, cost unit, cost driver), classification of costs per CAS-1, elements of cost, and cost ascertainment via the statement of cost and profit (cost sheet).

How to Pass the CMA Foundation Paper 2 (FFCA) Exam

What You Need to Know

Passing score: 40% in the paper and 50% in aggregate across the four Foundation papers
Assessment: Question count not published by the exam provider
Time limit: 2 hours (120 minutes)
Exam fee: Covered by the ICMAI Foundation course and examination fees; Paper 2 is not charged separately

Keys to Passing

Work through all 100 available questions
Review every answer and explanation
Track weak areas and revisit them
Use our AI tutor for tough concepts

CMA Foundation Paper 2 (FFCA) Study Tips from Top Performers

1Allocate about 70% of your time to financial accounting and 30% to cost accounting, mirroring the official weightings.

2Practise journal entries, cash book, and bank reconciliation until they are second nature, as they underpin much of Section A.

3Drill consignment loading, unsold-stock valuation, and bill due-date calculations, which are common objective traps.

4Memorise the cost-sheet build-up: prime cost, works cost, cost of production, and cost of sales, plus the items excluded from cost accounts.

5Because there is no negative marking, attempt every question and never leave a blank.

6Solve full-length 2-hour objective mocks to build speed across 100 marks.

Frequently Asked Questions

How many marks is CMA Foundation Paper 2 (FFCA)?

CMA Foundation Paper 2 carries 100 marks. Under the ICMAI Syllabus 2022, the Foundation papers are wholly objective and are completed within a 2-hour duration.

Is there negative marking in CMA Foundation Paper 2?

No. The ICMAI CMA Foundation examination under Syllabus 2022 is objective and does not have negative marking, so candidates are not penalised for wrong answers.

What is the weightage of financial vs cost accounting in Paper 2?

Section A, Fundamentals of Financial Accounting, carries 70% and Section B, Fundamentals of Cost Accounting, carries 30%. Within Section A, accounting fundamentals are 30%, special transactions 15%, and final accounts 25%.

What is the passing criteria for CMA Foundation?

A candidate must secure at least 40% marks in each paper and 50% marks in aggregate across all four Foundation papers to pass the ICMAI CMA Foundation examination.

What topics are in the cost accounting section of Paper 2?

Section B covers the meaning and significance of cost accounting, its relationship with financial accounting, cost concepts (cost, cost centre, cost unit, cost driver), classification of costs per CAS-1, elements of cost, and the cost sheet.

Who conducts the CMA Foundation Paper 2 exam?

The Institute of Cost Accountants of India (ICMAI), a statutory professional body, conducts the CMA Foundation examination, including Paper 2, Fundamentals of Financial and Cost Accounting.

100+ Free CMA Foundation Paper 2 (FFCA) Practice Questions

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