Download Certified Internal Auditor - Part 3, Business Analysis and Information Technology.IIA-CIA-Part3.ActualTests.2018-10-23.125q.vcex

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Vendor: IIA
Exam Code: IIA-CIA-Part3
Exam Name: Certified Internal Auditor - Part 3, Business Analysis and Information Technology
Date: Oct 23, 2018
File Size: 104 KB
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Demo Questions

Question 1
Which of the following engagement observations would provide the least motivation for management to amend or replace an existing cost accounting system? 
  1. The distorted unit cost of a service is 50 percent lower than the true cost, while the true cost is 50 percent higher than the competition's cost.
  2. The organization is losing $1,000,000 annually because it incorrectly outsourced an operation based on information from its current system.
  3. The cost of rework, hidden by the current system, is 50 percent of the total cost of all services.
  4. 50 percent of total organizational cost has been allocated on a volume basis.
Correct answer: D
Question 2
Which of the following control techniques would minimize the risk of interception during transmission in an electronic data interchange system? 
  1. Encryption. 
  2. Traffic padding. 
  3. Edit checks. 
  4. Structured data format.
  1. 1 and 2 only
  2. 2 and 3 only
  3. 3 and 4 only
  4. 1, 2, and 3 only
Correct answer: A
Explanation:
Question 3
Refer to the exhibit. 
  
The figure below shows the network diagram for the activities of a large project. What is the shortest number of days in which the project can be completed?
  1. 21 days.
  2. 22 days.
  3. 27 days.
  4. 51 days.
Correct answer: C
Question 4
Which of the following is a characteristic of just-in-time inventory management systems?
  1. Users determine the optimal level of safety stocks.
  2. They are applicable only to large organizations.
  3. They do not really increase overall economic efficiency because they merely shift inventory levels further up the supply chain.
  4. They rely heavily on high quality materials. 
Correct answer: D
Question 5
The economic order quantity for inventory is higher for an organization that has:
  1. Lower annual unit sales.
  2. Higher fixed inventory ordering costs.
  3. Higher annual carrying costs as a percentage of inventory value.
  4. A higher purchase price per unit of inventory.
Correct answer: B
Question 6
What must be monitored in order to manage risk of consumer product inventory obsolescence? 
  1. Inventory balances. 
  2. Market share forecasts. 
  3. Sales returns. 
  4. Sales trends.
  1. 1 only
  2. 4 only
  3. 1 and 4 only
  4. 1, 2, and 3 only
Correct answer: C
Explanation:
Question 7
The percentage of sales method, rather than the percentage of receivables method, would be used to estimate uncollectible accounts if an organization seeks to:
  1. Use an aging schedule to more closely estimate uncollectible accounts.
  2. Eliminate the need for an allowance for doubtful accounts.
  3. Emphasize the accuracy of the net realizable value of the receivables on the balance sheet.
  4. Use a method that approximates the matching principle.
Correct answer: D
Question 8
Preferred stock is less risky for investors than is common stock because:
  1. Common stock pays dividends as a stated percentage of face value.
  2. Common stock has priority over preferred stock with regard to earnings and assets.
  3. Preferred dividends are usually cumulative.
  4. Preferred stock with no conversion feature has a higher dividend yield than does convertible preferred stock.
Correct answer: C
Question 9
All of the following are possible explanations for a significant unfavorable material efficiency variance except:
  1. Cutbacks in preventive maintenance.
  2. An inadequately trained and supervised labor force. 
  3. A large number of rush orders.
  4. Production of more units than planned for in the master budget.
Correct answer: D
Question 10
When applied to international economics, the theory of comparative advantage proposes that total worldwide output will be greatest when:
  1. Each nation's total imports approximately equal its total exports.
  2. Each good is produced by the nation that has the lowest opportunity cost for that good.
  3. Goods that contribute to a nation's balance-of-payments deficit are no longer imported.
  4. International trade is unrestricted and tariffs are not imposed.
Correct answer: B
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