Pass Certified Internal IIA-CIA-Part3 exam [Dec 06, 2024] Updated 344 Questions
IIA IIA-CIA-Part3 Actual Questions and 100% Cover Real Exam Questions
NEW QUESTION # 117
An organization must manage its flows of raw materials, components, finished goods, services, or information through intermediaries to ultimate consumers. These flows may occur across the functions in an organization's:
- A. Integrated chain.
- B. Supply chain.
- C. Logistic chain.
- D. Value chain.
Answer: D
Explanation:
The supply chain consists of flows from sources of a) raw materials, b) components, c) finished goods, d) services, or e) information through intermediaries to ultimate consumers.
These flows and the related activities may occur across the functions in an organization's value chain R&D, design, production, marketing, distribution, and customer service). These flours and the related activities also may occur across separate organizations.
NEW QUESTION # 118
The arrival time follows which probability distribution?
- A. Exponential
- B. Binomial
- C. Chi-Square
- D. Poisson
Answer: D
Explanation:
Queuing models assume that arrivals follow a Poisson process: the events arrivals) are independent, any number of events must be possible in the interval of time, the probability {of an event is proportional to the length of the interval, and the probability {of more than one event is negligible if the interval is sufficiently} small. If is the average number of events in a given interval, k is the number of events, and e is the natural logarithm 2.71828...), the probability of k is.
f K) = k e - k !
A bank has two drive-in lanes to serve customers: one attached to the bank itself and one on an island. One teller serves bath stations. The bank is interested in determining the average waiting times of customers and has developed a model based on random numbers. The two key factors are the time between successive car arrivals and the time customers wait in line.
Assume that the analysis begins with cars just arriving at bath service windows bath requiring 3 minutes of service time. Car 1 is the attached window attached to the bank unless that window has more cars waiting than the island window. The lone teller will always serve the car that arrived first. If two cars arrive simultaneously, the one at the attached window will be served before the one at the island.
NEW QUESTION # 119
A multinational organization allows its employees to access work email via personal smart devices. However, users are required to consent to the installation of mobile device management (MDM) software that will remotely wipe data in case of theft or other incidents. Which of the following should the organization ensure in exchange for the employees' consent?
- A. That employee consent includes appropriate waivers regarding potential breaches to their privacy.
- B. That monitoring of employees' online activities is conducted in a covert way to avoid upsetting them.
- C. That personal data on the device cannot be accessed and deleted by system administrators.
- D. That those employees who do not consent to MDM software cannot have an email account.
Answer: C
NEW QUESTION # 120
Below are data concerning the hours spent by a manufacturer's two products in its two processes.
The constraint is:
- A. Product B in Assembly.
- B. The assembly activity.
- C. Cannot be determined from the information given.
- D. Product
Answer: B
Explanation:
In theory of constraints (TOC) analysis, the constraint (bottleneck) operation is the slowest part of the process. It can usually be identified as the one where work-in-process backs up the most of this manufacturer's two operations, the one that requires the most total time is assembly.
NEW QUESTION # 121
Which of the following controls most likely could prevent computer personnel from
modifying programs to bypass programmed controls?
- A. Participation of user department personnel in designing and approving new systems.
- B. Periodic management review of computer utilization reports and systems documentation.
- C. Segregation of duties within computer for computer programming and computer operations.
- D. Physical security of computer facilities in limiting access to computer equipment.
Answer: C
Explanation:
Programmers and analysts can modify programs, data files, and controls. Thus, they II should have no access to programs used to process transactions. Segregation of programming and operations is a control necessary to prevent unauthorized modifications of programs.
NEW QUESTION # 122
When determining the level of physical controls required for a workstation, which of the following factors should be considered?
- A. Value to the business.
- B. Intrusion prevention.
- C. Ergonomic model.
- D. Ease of use.
Answer: A
NEW QUESTION # 123
An individual had taxable income of US $23,r_ir_ir' per year and paid US $8,000 in income tax. The individual's taxable income then increased to US $30,000 per year resulting in a US $10,000 income tax liability. The personal tax system being applied to this individual is:
- A. Proportional.
- B. Progressive.
- C. Marginal.
- D. Regressive.
Answer: D
Explanation:
The average t rate of the individual has decreased from 34.8% US $8,000 - $23,000) to 33.3% (US $10.000 Under a regressive tax system, the average tax rate falls as income rises, although the amount of tax paid may rise.
NEW QUESTION # 124
Which of the following IT operational areas is responsible for the integrity of data flow within an organization?
- A. Network
- B. Operating system
- C. Server
- D. Database
Answer: A
NEW QUESTION # 125
A company's financial balance sheet is presented below:
The company has net working capital of:
- A. $210
- B. $490
- C. $350
- D. $160
Answer: A
NEW QUESTION # 126
A manufacturing company is attempting to implement a just-in-time (JIT) purchase policy system by negotiating with its primary suppliers to accept long-term purchase orders which result in more frequent deliveries of smaller quantities of raw materials. If the JIT purchase policy is successful in reducing the total inventory costs of the manufacturing company, which of the following combinations of cost changes would be most likely to occur?
- A. Option C
- B. Option A
- C. Option D
- D. Option B
Answer: C
Explanation:
The objective of a JIT system is to reduce carrying costs by eliminating inventories and increasing the deliveries made by suppliers. Ideally, shipments are received just in time to be incorporated into the manufacturing process. This system increases the risk of stock out costs because the inventory buffer is reduced or eliminated.
NEW QUESTION # 127
Which of the following statements is true regarding partnership liquidation?
- A. Partnership liquidation ends both the legal and economic life of an entity
- B. When a partnership is liquidated, each partner pays creditors from cash received
- C. Partnership liquidation occurs when there is capital deficiency
- D. Operations can continue after the liquidation if all partners agree
Answer: A
NEW QUESTION # 128
Lawson Ltd. has the opportunity to increase annual sales US $100,000 by selling to a new, riskier group of customers. Based on sales, the uncollectible expense this increase to be 15%, and collection costs will be 5%. Manufacturing and selling expenses are 70% of sales, and the effective tax rate is 40%. If Lawson accepts this opportunity, the after-tax profit will increase by:
- A. US $4,000
- B. US $6,000
- C. US $10,000
- D. US $9,000
Answer: B
Explanation:
Manufacturing and selling costs exclusive of bad debts equal 70% of sales. Hence, the gross profit en the US $100,000 increase in sales will be US $30,000$100,000 x 305: Assuming US $15,000 of bad debts and US $5,000 of collection expense, the increase in pre-tax profit will be
An entity has the following statements:
NEW QUESTION # 129
In the output or "expenditures" approach to measuring a country's gross domestic product, which of the following calculations is used?
- A. Consumption + Investment + Government purchases - Expenditures by foreigners.
- B. Consumption + Investment + Government purchases + Expenditures by foreigners.
- C. Consumption + Investment - Government purchases - Expenditures by foreigners.
- D. Consumption+ Investment - Government purchases - Expenditures by foreigners.
Answer: B
Explanation:
GDP can be calculated using an income approach or an expenditures approach because what is spent on a product or service is income to those who contributed resources to its production and marketing. Thus, the amount spent to purchase the GDP is identical with the income derived from its production and sale. Under the output or expenditures approach, GDP equals the sum of consumption expenditures by households, investment by business, government purchases of goods and services, and expenditures by foreigners net exports).
NEW QUESTION # 130
Which of the following measures create the most restrictive barrier to exporting to a country?
- A. Quotas.
- B. Tariffs
- C. Embargoes.
- D. Exchange controls.
Answer: C
Explanation:
An embargo is a total ban on some kinds of imports. It is an extreme form of the import quota. Embargoes have the effect of totally excluding the exporting entity from selling in that country and are the most restrictive type of import/export law.
NEW QUESTION # 131
When applied to international economics, the theory of comparative advantage proposes that total worldwide output will be greatest when:
- A. Goods that contribute to a nation's balance-of-payments deficit are no longer imported.
- B. Each nation's total imports approximately equal its total exports.
- C. Each good is produced by the nation that has the lowest opportunity cost for that good.
- D. International trade is unrestricted and tariffs are not imposed.
Answer: C
NEW QUESTION # 132
Which of the following is an example of a nonfinancial internal failure quality cost?
- A. Foregone contribution margin on lost sales.
- B. Defective units shipped to customers.
- C. Excessive time to convert raw materials into finished goods.
- D. Decreasing gross profit margins over time.
Answer: C
NEW QUESTION # 133
Which inventory pricing method generally approximates current cost for each of the following?
- A. Option C
- B. Option D
- C. Option A
- D. Option B
Answer: A
Explanation:
FIFO assigns the most recent purchase prices to ending inventory and the earliest purchase prices to cost of goods sold. LIFO uses the earliest acquisition costs to price the ending inventory. It is not permitted by the IFRSs. Thus, FIFO approximates current for ending inventory, and LIFO approximates current cost of goods sold.
NEW QUESTION # 134
An entity purchased a new machine for US $' III 610100 by borrowing the required funds from a bank for 180 days. What will be the direct impact of this transaction?
- A. Increase the current ratio and decrease the debt ratio.
- B. Decrease the current ratio and increase the debt ratio.
- C. Decrease the current ratio and decrease the debt ratio.
- D. Increase the current ratio and increase the debt ratio.
Answer: B
Explanation:
The borrowing of funds for 180 days constitutes short-term borrowing. The new machine is a fixed asset. Current liabilities have increased, and current assets have remained constant. Consequently, the current ratio current assets + current liabilities) has decreased. Total debt and total assets increased by the same absolute amount, and the debt ratio total debt - total assets) should have increased. assuming total debt is less than total asset.
NEW QUESTION # 135
In the standard regression equation y = a + bx, how is the letter b best described?
- A. Dependent Variable
- B. Variable coefficient
- C. Constant coefficient
- D. Independent Variable
Answer: B
Explanation:
In the standard regression equation, b represents the variable coefficient. For example, in a cost determination regression, equals total costs, b is the variable cost per unit, is the number of units produced, and a is fixed cost. In preparing the annual profit plan for the coming year, Wilkens Company wants to determine the cost behavior pattern of the maintenance costs.
Wilkens has decided to use linear regression by employing the equation = a + bx for maintenance costs. The prior year's data regarding maintenance hours and costs, and the results of the regression analysis, are given below and in the opposite column.
NEW QUESTION # 136
A financial institution receives frequent and varied email requests from customers for funds to be wired out of their accounts. Which verification activity would best help the institution avoid falling victim to phishing?
- A. Replying to the customer via email to validate the sender and request.
- B. Calling the customer at the phone number on record to validate the request.
- C. Reviewing the customer record to verify whether the customer has authorized wire requests from that email address.
- D. Reviewing the customer's wire activity to determine whether the request is typical.
Answer: B
NEW QUESTION # 137
The process of making sure that the model measures what it is supposed to measure is called:
- A. Hypothesis testing.
- B. Statistical inference.
- C. Confidence coefficient analysis.
- D. Validation.
Answer: D
Explanation:
Validation is a step in the simulation procedure. Some assurance is needed that the results of the experiment will be realistic. This assurance requires validation of the model -- often using historical data. If the model gives results equivalent to what actually happened, the model is historically valid. There is still some risk, however, that changes could make the model invalid for the future.
NEW QUESTION # 138
If the probability of hot weather, given a hot weather forecast, is 50%, how much would the vendor be willing to pay for the forecast?
- A. US $600
- B. US $300
- C. US $500
- D. US $1,000
Answer: B
Explanation:
If the weather is hot and coffee is served, the vendor earns US $1,900. If the vendor knows the weather will be hot, she would sell soft drinks and make U $2,500, a US $600 increase.
Thus, the vendor should be willing to pay up to U $600 for perfect information regarding hot weather. However, if the forecasts are only 50% accurate, the information is not perfect. Accordingly, the vendor should be willing to pay only U $300 the U $600 potential increase
in profits 50%) for the sometimes accurate forecasts.
NEW QUESTION # 139
An organization has recorded the following profit and expenses:
Profit before interest and tax
$200,000
Sales
$2,300,000
Purchases of materials
$700,000
Interest expenses
$30,000
If the value-added tax (VAT) rate is 20 percent and the corporate tax rate is 30 percent, which of the following is the amount of VAT that the organization has to pay?
- A. $320,000
- B. $51,000
- C. $34,000
- D. $60,000
Answer: A
NEW QUESTION # 140
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IIA-CIA-Part3 exam covers a broad range of topics related to business knowledge, including organizational structure, financial management, IT governance, and risk management. It requires candidates to have a deep understanding of how businesses operate and how they can use this knowledge to enhance their internal auditing practices. IIA-CIA-Part3 exam also emphasizes the importance of staying up-to-date with the latest business trends and practices.
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