CMA
CMA NEW JERSEY
MUNICIPAL MONEY FUND
Annual Report
March 31, 1996
Merrill Lynch
BULL LOGO
Officers and Trustees
Arthur Zeikel--President and Trustee
Ronald W. Forbes--Trustee
Cynthia A. Montgomery--Trustee
Charles C. Reilly--Trustee
Kevin A. Ryan--Trustee
Richard R. West--Trustee
Terry K. Glenn--Executive Vice President
Vincent R. Giordano--Senior Vice President
Edward J. Andrews--Vice President
Donald C. Burke--Vice President
Peter J. Hayes--Vice President
Kenneth A. Jacob--Vice President
Kevin A. Schiatta--Vice President
Helen Marie Sheehan--Vice President
Gerald M. Richard--Treasurer
Robert Harris--Secretary
Custodian
State Street Bank and Trust Company
P.O. Box 1713
Boston, MA 02101
Transfer Agent
Merrill Lynch Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
(800) 221-7210*
[FN]
*For inquiries regarding your CMA account, call (800) CMA-INFO
[(800) 262-4636].
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Fund unless
accompanied or preceded by the Fund's current prospectus. Past
performance results shown in this report should not be considered a
representation of future performance, which will fluctuate. The Fund
seeks to maintain a consistent $1.00 net asset value per share,
although this cannot be assured. An investment in the Fund is
neither insured nor guaranteed by the US Government. Statements and
other information herein are as dated and are subject to change.
CMA New Jersey
Municipal Money Fund
Box 9011
Princeton, NJ 08543-9011
To Our Shareholders:
For the year ended March 31, 1996, CMA New Jersey Municipal Money
Fund paid shareholders a net annualized yield of 3.07%*. As of March
31, 1996, the Fund's 7-day yield was 2.64%.
The Environment
As 1995 drew to a close and 1996 began, it appeared that the US
economy was losing momentum. Lackluster retail sales, increases in
initial unemployment claims (along with weak job and income growth),
and evidence of slowing in the manufacturing sector all suggested
that the rate of economic growth was slowing, with some forecasters
even suggesting the possibility of an imminent recession. With
inflationary pressures well subdued, these signs of economic
weakness led the Federal Reserve Board to follow a more
accommodative monetary policy.
However, investor perceptions regarding the rate of future economic
growth changed dramatically with the report of stronger-than-
expected employment data for February and March. As a result, the
consensus outlook regarding the direction of business activity
shifted from expectations of weakness to anticipation of a revival
in growth of the economy. Long-term interest rates rose, and the
Federal Reserve Board left monetary policy on hold.
Investors are likely to continue to focus on the probable direction
of economic activity and Federal Reserve Board monetary policy in
the weeks ahead. At this time, inflationary pressures do not seem to
be building and the manufacturing sector is still relatively weak,
which suggest that the economy is not on the verge of overheating.
Nevertheless, it is likely that any further indication of stronger
economic activity in the weeks ahead may add to investor concerns
that accelerating economic activity could lead to higher interest
rates.
[FN]
*Based on a constant investment throughout the period, with
dividends compounded daily, and reflecting a net return to the
investor after all expenses.
Investment Outlook and Strategy
Short-term interest rates fluctuated during the six-month period
ended March 31, 1996 as investors reacted to mixed economic signals.
The first half of the period saw interest rates drop as economic
data showed a slowing economy. The Federal Reserve Board moved to
lower interest rates at both its December 1995 and January 1996
meetings. The Federal Funds rate was lowered by 50 basis points
(0.50%) to 5.25% and the discount rate was lowered by 25 basis
points to 5.00%. However, toward the close of the six-month period
stronger-than-expected data forced yields higher. Non-farm payroll
employment for February increased by 705,000 jobs, one of the
largest increases ever recorded. That report along with other strong
figures pushed the yield on the one-year Treasury note higher by
approximately 60 basis points off the levels of mid-February. In
light of these renewed signs of economic strength the Federal
Reserve Board chose to leave interest rates unchanged at the March
1996 meeting. In the upcoming months we will see if this strength is
sustainable or simply a product of the severe winter weather and
Government shutdown.
New Jersey's economy continues to experience the strain of corporate
restructuring and sluggish tax revenues. In January, Governor
Whitman introduced a $16 billion budget that included revamping
welfare spending and eliminating 1,200 state employees. New Jersey
entered the short-term municipal market twice during the six-month
period ended March 31, 1996, issuing a total of $450 million in tax-
exempt commercial paper. The State had originally intended to issue
$200 million to satisfy its needs through June 1996, but was forced
to issue an additional $250 million to bridge a lack of funds caused
by the Federal Government's shutdown. During the six months ended
March 31, 1996, short-term municipal issuance within the State
increased to $1.4 billion from $624.9 million for the previous six-
month period.
We maintained CMA New Jersey Municipal Money Fund's average
portfolio maturity in the 40-day--50-day range for the six-month
period ended March 31, 1996. Several factors influenced our strategy
for the most recent six months. First, the short-term interest rate
yield curve remained flat to slightly inverted for most of the
period. A yield curve of this nature makes an aggressive extension
of the Fund's average portfolio maturity unattractive. Second, the
Fund experienced net cash inflows of approximately 12% of net assets
during the period. These inflows were predominately satisfied with
purchases of variable rate demand notes with maturities of seven
days or less and shortened the Fund's average portfolio maturity.
Finally, as we discussed earlier, the strength of recent economic
data casts some doubt as to the future direction of interest rates
and justified a continued neutral average maturity. In the upcoming
months, we will continue to monitor the direction of the US economy
and the short-term municipal market.
In Conclusion
We thank you for your continued interest in CMA New Jersey Municipal
Money Fund, and we look forward to serving your investment needs in
the future.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Vincent R. Giordano)
Vincent R. Giordano
Senior Vice President
(Steven T. Lewis)
Steven T. Lewis
Portfolio Manager
April 23, 1996
Portfolio Abbreviations for CMA New Jersey Municipal Money Fund
ACES SM Adjustable Convertible Extendable Securities
AMT Alternative Minimum Tax (subject to)
BAN Bond Anticipation Notes
CP Commercial Paper
EDA Economic Development Authority
GO General Obligation Bonds
PCR Pollution Control Revenue Bonds
RAN Revenue Anticipation Notes
TAN Tax Anticipation Notes
TRAN Tax and Revenue Anticipation Notes
UT Unlimited Tax
VRDN Variable Rate Demand Notes
<TABLE>
CMA NEW JERSEY MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1996 (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
New Jersey-- $ 3,800 Atlantic County, New Jersey, Improvement Authority Revenue Bonds
96.9% (Pooled Governmental Loan Program), ACES, 3.10% due 7/01/2026 (a) $ 3,800
Bayonne, New Jersey:
7,000 BAN, UT, 4.10% due 9/13/1996 7,006
1,700 Temporary Notes, 3.88% due 9/13/1996 1,703
7,040 UT, Temporary Notes, 4.10% due 9/13/1996 7,046
4,880 Bergenfield, New Jersey, BAN, 4% due 1/31/1997 (e) 4,903
8,325 Bernards Township, New Jersey, Sewer Authority, Revenue Refunding
Bonds, 3.85% due 12/15/1996 8,331
4,000 Camden County, New Jersey, Improvement Authority Revenue Bonds
(Jewish Community Center Project), VRDN, 3.25% due 12/01/2010 (a) 4,000
2,017 Cedar Grove Township, New Jersey, BAN, UT, 3.50% due 3/11/1997 (e) 2,015
Eagle Tax Exempt Trust, New Jersey, VRDN, Series 94C-3001 (a):
15,900 3.47% due 10/01/2015 15,900
4,100 3.52% due 10/01/2015 4,100
Elizabeth, New Jersey, BAN, UT:
4,000 4.26% due 7/17/1996 4,002
5,000 4.34% due 7/17/1996 5,003
5,000 4.44% due 7/17/1996 5,004
Essex County, New Jersey, Improvement Authority Revenue Bonds
(Pooled Governmental Loan Program), ACES (a):
7,200 2.85% due 12/01/1998 7,200
14,250 2.85% due 7/01/2026 14,250
13,260 Floating Rate Trust Certificates, New Jersey, VRDN, Series 1994-E,
3.35% due 7/02/1999 (a) 13,260
12,200 Hudson County, New Jersey, Improvement Authority Revenue Bonds
(Pooled Government Loan Program), VRDN, 3.30% due 7/15/2026 (a) 12,200
14,000 Hunterdon County, New Jersey, BAN, 3.69% due 5/03/1996 14,000
14,700 Jersey City, New Jersey, BAN, UT, 4.75% due 9/27/1996 14,750
4,500 Middlesex County, New Jersey, Refunding Bonds, UT, 3.60% due
7/15/1996 4,497
Monmouth County, New Jersey, Improvement Authority Revenue Bonds:
1,095 (Governmental Loan), 3.65% due 7/15/1996 (d) 1,095
21,600 (Pooled Government Loan Program), ACES, 3.15% due 8/01/2016 (a) 21,600
2,400 New Brunswick, New Jersey, BAN, 4.10% due 7/12/1996 (e) 2,401
New Jersey EDA, Dock Facility Revenue Refunding Bonds (Bayonne/IMTT
Project), VRDN, Series A (a):
10,400 3.15% due 12/01/2027 10,400
8,350 3.20% due 12/01/2027 8,350
</TABLE>
<TABLE>
CMA NEW JERSEY MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1996 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
New Jersey New Jersey EDA, Economic Development Revenue Bonds, VRDN (a):
(continued) $ 2,600 (400 International Drive Partners), 3.05% due 9/01/2005 $ 2,600
625 (Astor Chocolate Corporation Project), AMT, 3.40% due 4/01/2002 625
9,525 (Benedictine Abbey of Newark), 3.40% due 12/01/2019 9,525
1,725 (Brach/Jersey Avenue Project), 3.15% due 5/01/2011 1,725
1,250 (Catholic Community Services), 3.20% due 6/01/2025 1,250
6,000 (Center for Aging, Applewood Estates Project), 3.30% due 12/01/2019 6,000
1,700 (Filtra Corp. Project), 3.40% due 8/01/2015 1,700
2,000 (International Vitamin Corp. Project), AMT, 3.40% due 5/01/2003 2,000
1,250 (Manhattan Bagel Co. Inc. Project), AMT, 3.40% due 10/01/2005 1,250
1,750 (Office Court Associates Project), AMT, 3.25% due 4/01/2011 1,750
1,870 (Park Lane Association Project), AMT, 3.40% due 4/01/2010 1,870
1,500 Refunding (Church & Dwight), 2.85% due 12/01/2008 1,500
2,420 Refunding (RJB Associates Project), 3.40% due 8/01/2008 2,420
1,365 (Saint Peter's Preparatory School), 3.30% due 1/01/2010 1,365
New Jersey EDA, Industrial and Economic Development Revenue Bonds,
VRDN (a):
1,000 (Elizabeth Realty Urban Renewal Associates--1986 Project), AMT,
3.85% due 6/01/2000 1,000
4,100 (Seton Company Project), 3.35% due 9/01/2005 4,100
2,300 New Jersey EDA, Natural Gas Facilities Revenue Bonds (Natural Gas
Company Project), VRDN, Series B, 3.30% due 8/01/2030 (a)(f) 2,300
New Jersey EDA, PCR, VRDN, Series A (a):
7,450 (Merck & Co.), 3.55% due 10/01/2004 7,450
8,000 Refunding (Public Service Electric & Gas Co.), CP, 3.15% due
4/08/1996 (h) 8,000
5,000 New Jersey EDA, Port Facility Revenue Bonds (Trailer Marine Crowle),
VRDN, 3.35% due 2/01/2002 (a) 5,000
New Jersey EDA, Revenue Bonds:
9,000 (Chambers Cogeneration), CP, AMT, 3.20% due 4/11/1996 9,000
4,500 (Chambers Cogeneration), CP, AMT, 3.05% due 5/01/1996 4,500
1,305 (E.P. Henry Corp. Project), VRDN, 3.40% due 3/01/2005 (a) 1,305
3,000 (Economic Growth--Paterson), VRDN, AMT, Series A, 3.50% due
11/01/2015 (a) 3,000
2,000 (Economic Growth--Paterson), VRDN, AMT, Series B, 3.50% due
11/01/2004 (a) 2,000
6,000 First Mortgage (Fellowship VLG Project), VRDN, Series B, 3.35% due
1/01/2001 (a) 6,000
7,800 (Hoffman-La Roche Inc. Project), VRDN, AMT, 3.05% due 11/01/2011 (a) 7,800
9,200 (Keystone Project), CP, 3.25% due 4/30/1996 9,200
3,000 (Keystone Project), CP, 3.20% due 5/01/1996 3,000
2,000 (Peddie School Project), VRDN, Series B, 3.25% due 2/01/2019 (a) 2,000
1,000 (Peddie School Project), VRDN, 3.20% due 2/01/2026 (a) 1,000
5,865 (Public Schools Small Project Loan Program), 3.80% due 8/15/1996 5,874
3,000 New Jersey EDA, Thermal Energy Facilities Revenue Bonds (Thermal
Energy Limited Partnership), AMT, 3.70% due 4/30/1996 3,000
28,800 New Jersey Sports and Exposition Authority, State Contract Revenue
Bonds, VRDN, Series C, 3.10% due 9/01/2024 (a) 28,800
New Jersey State, CP, Series 96:
5,000 TAN, 3.25% due 4/08/1996 5,000
25,000 TAN, 3.40% due 4/11/1996 25,000
10,000 TAN, 3.55% due 4/12/1996 10,000
6,000 TAN, 3.30% due 5/21/1996 6,000
9,000 TRAN, 3.30% due 5/07/1996 9,000
9,450 New Jersey State Educational Facilities Authority Revenue Bonds
(Higher Educational Facilities Trust Fund), Series A, 5.125%
due 9/01/1996 (f) 9,510
</TABLE>
<TABLE>
CMA NEW JERSEY MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1996 (CONCLUDED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
New Jersey New Jersey State, GO:
(concluded) $ 3,500 7.20% due 4/15/1996 (b) $ 3,506
1,000 7.30% due 11/01/1996 (c) 1,026
9,000 New Jersey State Transportation Trust Fund Authority, Series A,
5.50% due 12/15/1996 (b) 9,143
13,800 New Jersey State Turnpike Authority, Turnpike Revenue Refunding
Bonds, VRDN, Series D, 3.05% due 1/01/2018 (a)(g) 13,800
3,000 Passaic County, New Jersey, BAN, 3.67% due 11/19/1996 3,002
Port Authority of New York and New Jersey:
11,895 AMT, CP, 3.05% due 5/01/1996 11,895
1,550 CP, Series A and B, 3.15% due 4/08/1996 1,550
6,575 CP, Series A and B, 3.20% due 4/10/1996 6,575
15,000 CP, Series A and B, 3.60% due 4/12/1996 15,000
1,280 CP, Series A and B, 3.45% due 8/14/1996 1,280
2,030 (Line of Credit), AMT, CP, 3.25% due 5/01/1996 2,030
9,850 (Line of Credit), AMT, CP, 3.30% due 5/01/1996 9,850
4,980 (Line of Credit), AMT, CP, 3.25% due 8/08/1996 4,980
2,440 (Line of Credit), AMT, CP, 3.40% due 8/23/1996 2,440
2,500 One Hundred-Third Series, 3.50% due 12/15/1996 (h) 2,498
Port Authority of New York and New Jersey, Special Obligation
Revenue Bonds (Versatile Structure Obligation), VRDN (a):
47,300 AMT, Series 1, 3.20% due 8/01/2028 47,300
300 Series 3, 3.25% due 6/01/2020 300
4,212 Roxbury Township, New Jersey, BAN, UT, 3.75% due 2/14/1997 4,230
1,160 Rutgers State University, New Jersey, University Revenue Refunding
Bonds, Series N, 7.375% due 5/01/1996 (c) 1,169
Salem County, New Jersey, Industrial Pollution Control Financing
Authority Revenue Bonds, Series A:
7,300 (du Pont (E.I.) de Nemours), VRDN, 3.40% due 3/01/2012 (a) 7,300
4,200 (Philadelphia Electric), CP, 3.30% due 4/25/1996 4,200
4,050 Scotch Plains Township, New Jersey, BAN, Series A, 4.25% due
4/04/1996 (e) 4,050
3,500 South Plainfield, New Jersey, BAN, UT, 3.95% due 7/26/1996 3,500
Union County, New Jersey, Industrial Pollution Control Financing
Authority, PCR, Refunding, VRDN (a):
2,200 (Allied Signal Project), 3.50% due 12/01/2020 2,200
17,300 (Exxon Project), 3.05% due 7/01/2033 17,300
Puerto Rico-- Puerto Rico Commonwealth, Government Development Bank, CP:
2.9% 7,800 3.45% due 4/03/1996 7,800
10,000 3.25% due 4/25/1996 10,000
Total Investments (Cost--$609,159*)-- 99.8% 609,159
Other Assets Less Liabilities--0.2% 1,126
----------
Net Assets--100.0% $ 610,285
==========
<FN>
(a)The interest rate is subject to change periodically based on
certain indexes. The interest rate shown is the rate in effect at
March 31, 1996.
(b)Escrowed to maturity.
(c)Prerefunded.
(d)FSA Insured.
(e)Bank Qualified.
(f)AMBAC Insured.
(g)FGIC Insured.
(h)MBIAInsured.
*Cost for Federal income tax purposes.
See Notes to Financial Statements.
</TABLE>
<TABLE>
CMA NEW JERSEY MUNICIPAL MONEY FUND
STATEMENT OF ASSETS AND LIABILITIES AS OF MARCH 31, 1996
<S> <C> <C>
Assets:
Investments, at value (identified cost--$609,158,594) (Note 1a) $ 609,158,594
Cash 8,121
Receivables:
Interest $ 3,986,503
Securities sold 3,480,000 7,466,503
---------------
Prepaid registration fees and other assets (Note 1d) 44,927
---------------
Total assets 616,678,145
---------------
Liabilities:
Payables:
Securities purchased 5,842,359
Investment adviser (Note 2) 242,784
Distributor (Note 2) 190,574 6,275,717
---------------
Accrued expenses and other liabilities 117,773
---------------
Total liabilities 6,393,490
---------------
Net Assets $ 610,284,655
===============
Net Assets Consist of:
Shares of beneficial interest, $0.10 par value, unlimited number of
shares authorized $ 61,035,501
Paid-in capital in excess of par 549,319,182
Undistributed investment income--net 5,378
Accumulated realized capital losses--net (Note 4) (75,406)
---------------
Net Assets--Equivalent to $1.00 per share based on 610,355,010 shares
of beneficial interest outstanding $ 610,284,655
===============
See Notes to Financial Statements.
</TABLE>
<TABLE>
CMA NEW JERSEY MUNICIPAL MONEY FUND
STATEMENT OF OPERATIONS FOR THE YEAR ENDING MARCH 31, 1996
<S> <C> <C>
Investment Income (Note 1c):
Interest and amortization of premium and discount earned $ 20,811,368
Expenses:
Investment advisory fees (Note 2) $ 2,760,878
Distribution fees (Note 2) 701,300
Transfer agent fees (Note 2) 126,778
Accounting services (Note 2) 56,678
Professional fees 56,025
Printing and shareholder reports 47,323
Custodian fees 40,102
Registration fees (Note 1d) 31,488
Pricing fees 10,031
Trustees' fees and expenses 6,125
Amortization of organization expenses (Note 1d) 2,912
Other 9,826
---------------
Total expenses 3,849,466
---------------
Investment income--net 16,961,902
Realized Loss on Investments--Net (Note 1c) (4,492)
---------------
Net Increase in Net Assets Resulting from Operations $ 16,957,410
===============
</TABLE>
<TABLE>
CMA NEW JERSEY MUNICIPAL MONEY FUND
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Year Ended March 31,
Increase (Decrease) in Net Assets: 1996 1995
<S> <C> <C>
Operations:
Investment income--net $ 16,961,902 $ 11,557,524
Realized loss on investments--net (4,492) (30,343)
--------------- ---------------
Net increase in net assets resulting from operations 16,957,410 11,527,181
--------------- ---------------
Dividends to Shareholders (Note 1e):
Investment income--net (16,955,885) (11,550,666)
--------------- ---------------
Net decrease in net assets resulting from dividends
to shareholders (16,955,885) (11,550,666)
--------------- ---------------
Beneficial Interest Transactions (Note 3):
Net proceeds from sale of shares 1,937,805,407 1,629,827,901
Net asset value of shares issued to shareholders in reinvestment of
dividends (Note 1e) 16,956,937 11,550,723
--------------- ---------------
1,954,762,344 1,641,378,624
Cost of shares redeemed (1,870,226,420) (1,557,454,149)
--------------- ---------------
Net increase in net assets derived from beneficial interest transactions 84,535,924 83,924,475
--------------- ---------------
Net Assets:
Total increase in net assets 84,537,449 83,900,990
Beginning of year 525,747,206 441,846,216
--------------- ---------------
End of year* $ 610,284,655 $ 525,747,206
=============== ===============
<FN>
*Undistributed investment income--net (Note 1f) $ 5,378 $ --
=============== ===============
See Notes to Financial Statements.
</TABLE>
<TABLE>
CMA NEW JERSEY MUNICIPAL MONEY FUND
FINANCIAL HIGHLIGHTS
<CAPTION>
The following per share data and ratios have been derived
from information provided in the financial statements. For the Year Ended March 31,
Increase (Decrease) in Net Asset Value: 1996 1995 1994 1993 1992
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
Investment income--net .03 .02 .02 .02 .03
---------- ---------- ---------- ---------- ----------
Total from investment operations .03 .02 .02 .02 .03
---------- ---------- ---------- ---------- ----------
Less dividends from investment income--net (.03) (.02) (.02) (.02) (.03)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ==========
Total Investment Return 3.07% 2.52% 1.82% 2.21% 3.49%
========== ========== ========== ========== ==========
Ratios to Average Net Assets:
Expenses .68% .71% .70% .70% .74%
========== ========== ========== ========== ==========
Investment income--net 3.02% 2.51% 1.80% 2.16% 3.42%
========== ========== ========== ========== ==========
Supplemental Data:
Net assets, end of year (in thousands) $ 610,285 $ 525,747 $ 441,846 $ 388,903 $ 350,058
========== ========== ========== ========== ==========
See Notes to Financial Statements.
</TABLE>
CMA NEW JERSEY MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
CMA New Jersey Municipal Money Fund (the "Fund") is part of CMA
Multi-State Municipal Series Trust (the "Trust"). The Fund is
registered under the Investment Company Act of 1940 as a non-
diversified, open-end management investment company. The following
is a summary of significant accounting policies followed by the
Fund.
(a) Valuation of investments--Investments are valued at amortized
cost, which approximates market value. For the purpose of valuation,
the maturity of a variable rate demand instrument is deemed to be
the next coupon date on which the interest rate is to be adjusted.
In the case of a floating rate instrument, the remaining maturity is
the demand notice payment period.
(b) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required.
(c) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Interest income (including amortization of
premium and discount) is recognized on the accrual basis. Realized
gains and losses on security transactions are determined on the
identified cost basis.
(d) Deferred organization expenses and prepaid registration fees--
Deferred organization expenses are charged to expense on a straight-
line basis over a five-year period. Prepaid registration fees are
charged to expense as the related shares are issued.
(e) Dividends and distributions to shareholders--The Fund declares
dividends daily and reinvests daily such dividends (net of non-
resident alien tax withheld) in additional fund shares at net asset
value. Dividends are declared from the total of net investment
income, excluding discounts earned other than original issue
discounts. Net realized capital gains, if any, are normally
distributed annually after deducting prior years' loss carryforward.
The Fund may distribute capital gains more frequently than annually
in order to maintain the Fund's net asset value at $1.00 per share.
(f) Reclassification--Generally accepted accounting principles
require that certain components of net assets be reclassified to
reflect permanent differences between financial reporting and tax
purposes. Accordingly, current year's permanent book/tax differences
of $327 and $639 have been reclassified from paid-in capital in
excess of par and undistributed net investment income, respectively,
to accumulated realized capital losses. These reclassifications have
no effect on net assets or net asset value per share.
2. Investment Advisory Agreement and
Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Fund
Asset Management, L.P. ("FAM" or "Adviser"). The general partner of
FAM is Princeton Services, Inc. ("PSI"), an indirect wholly-owned
subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the
limited partner.
FAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee based upon the average daily
value of the Fund's net assets, at the following annual rates: 0.50%
of the first $500 million of average daily net assets; 0.425% of
average daily net assets in excess of $500 million but not exceeding
$1 billion; and 0.375% of average daily net assets in excess of $1
billion.
CMA NEW JERSEY MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS (concluded)
The most restrictive annual expense limitation requires that the
Adviser reimburse the Fund to the extent the Fund's expenses
(excluding interest, taxes, distribution fees, brokerage fees and
commissions, and extraordinary items) exceed in any fiscal year 2.5%
of the Fund's first $30 million of average daily net assets, 2.0% of
the Fund's next $70 million of average daily net assets, and 1.5% of
the average daily net assets in excess thereof. No fee payment will
be made to the Adviser during any year which will cause such
expenses to exceed the pro rata expense limitation at the time of
such payment.
Pursuant to the Distribution and Shareholder Servicing Plan in
compliance with Rule 12b-1 under the Investment Company Act of 1940,
Merrill Lynch, Pierce, Fenner & Smith Inc. ("MLPF&S") receives a
distribution fee from the Fund at the end of each month at the
annual rate of 0.125% of average daily net assets of the Fund. The
distribution fee is to compensate MLPF&S financial consultants and
other directly involved branch office personnel for selling shares
of the Fund and for providing direct personal services to
shareholders. The distribution fee is not compensation for the
administrative and operational services rendered to the Fund by
MLPF&S in processing share orders and administering shareholder
accounts.
Merrill Lynch Financial Data Services, Inc. ("MLFDS"), a wholly-
owned subsidiary of ML & Co., is the Fund's transfer agent.
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or trustees of the Fund are officers and/or
directors of FAM, PSI, MLPF&S, MLFDS, and/or ML & Co.
3. Shares of Beneficial Interest:
The number of shares purchased and redeemed during the period
corresponds to the amounts included in the Statements of Changes in
Net Assets for net proceeds from sale of shares and cost of shares
redeemed, respectively, since shares are recorded at $1.00 per
share.
4. Capital Loss Carryforward:
At March 31, 1996, the Fund had a net capital loss carryforward of
approximately $75,000, of which $71,000 expires in 2003 and $4,000
expires in 2004. This amount will be available to offset like
amounts of any future taxable gains.
<AUDIT-REPORT>
CMA NEW JERSEY MUNICIPAL MONEY FUND
INDEPENDENT AUDITOR'S REPORT
The Board of Trustees and Shareholders,
CMA New Jersey Municipal Money Fund of
CMA Multi-State Municipal Series Trust:
We have audited the accompanying statement of assets and
liabilities, including the schedule of investments, of CMA New
Jersey Municipal Money Fund of CMA Multi-State Municipal Series
Trust as of March 31, 1996, the related statements of operations for
the year then ended and changes in net assets for each of the years
in the two-year period then ended, and the financial highlights for
each of the years in the five-year period then ended. These
financial statements and the financial highlights are the
responsibility of the Fund's management. Our responsibility is to
express an opinion on these financial statements and the financial
highlights based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements and the financial highlights are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements.
Our procedures included confirmation of securities owned at March
31, 1996 by correspondence with the custodian and broker. An audit
also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights
present fairly, in all material respects, the financial position of
CMA New Jersey Municipal Money Fund of CMA Multi-State Municipal
Series Trust as of March 31, 1996, the results of its operations,
the changes in its net assets, and the financial highlights for the
respective stated periods in conformity with generally accepted
accounting principles.
Deloitte & Touche LLP
Princeton, New Jersey
April 30, 1996
</AUDIT-REPORT>
IMPORTANT TAX INFORMATION (UNAUDITED)
All of the net investment income distributions paid daily by CMA New
Jersey Municipal Money Fund of CMA Multi-State Municipal Series
Trust during its taxable year ended March 31, 1996 qualify as tax-
exempt interest dividends for Federal income tax purposes.
Additionally, there were no capital gains distributed during the
Fund's taxable year ended March 31, 1996.
Please retain this information for your records.
