Prep4SureReview IIA-CIA-Part3 Real Exam Question Answers Updated [Oct 27, 2024]
Easily To Pass New IIA IIA-CIA-Part3 Dumps with 344 Questions
NEW QUESTION # 185
If an entity has a higher dividend-payout ratio. then. if all else is equal, it will have a:
- A. Higher investment opportunity schedule.
- B. Higher marginal cost of capital.
- C. Lower marginal cost of capital.
- D. Lower investment opportunity schedule.
Answer: B
Explanation:
The higher the dividend-payout ratio, the sooner retained earnings are exhausted and the entity must seek external financing. Assuming the name investments are undertaken, the result is a higher marginal coot of capital because lower-cost capital sources will be used up earlier.
NEW QUESTION # 186
How is the letter x in the standard regression equation best described?
- A. Coefficient of determination
- B. Dependent Variable
- C. Independent Variable
- D. Constant coefficient
Answer: C
Explanation:
The letters x in the standard regression equation is the independent variable. For example, in a regression to determine the total cost of production, equal units produced. 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 # 187
Which of the following represents the greatest exposure to the integrity of electronic funds transfer data transmitted from a remote terminal?
- A. Poor physical access controls over the data center.
- B. Leased telephone circuits.
- C. Network viruses.
- D. Poor system documentation.
Answer: B
Explanation:
Leased telephone circuits represent a direct exposure to the risk of breached
data integrity.
They use public lines that c. an be easily identified and tapped.
NEW QUESTION # 188
Which of the following is the most appropriate activity for an internal auditor to perform during a review of systems development activity?
- A. Recommend specific automated procedures to be incorporated into new systems that will provide reasonable assurance that all data submitted to an application are converted to machine-readable form.
- B. Recommended specific operational procedures that will ensure that all data submitted for processing are converted to machine-readable form.
- C. Review the methodology used to monitor and control the system development function.
- D. Serve on the IT steering committee that determines what new systems are to be developed.
Answer: C
Explanation:
Auditor objectivity is not impaired when she recommends standards of control for systems or reviews procedures before implementation. However. drafting procedures for systems and designing, installing. and operating systems are not audit functions. Thus, reviewing the methodology used by an organization is an appropriate activity that enables the internal auditor to determine whether s)he can rely on the systems development activity to design and implement appropriate automated controls within applications.
NEW QUESTION # 189
A global business organization is selecting managers to post to various international (expatriate) assignments. In the screening process, which of the following traits would be required to make a manager a successful expatriate?
1. Superior technical competence.
2. Willingness to attempt to communicate in a foreign language.
3. Ability to empathize with other people.
- A. 1 and 2 only
- B. 1, 2, and 3
- C. 1 and 3 only
- D. 2 and 3 only
Answer: D
NEW QUESTION # 190
Which of the following criteria would be most useful to a sales department manager in evaluating the performance of the manager's customer-service group?
- A. All customer inquiries should be answered within 7 days of receipt.
- B. The customer is always right.
- C. Employees should maintain a positive attitude when dealing with customers.
- D. Customer complaints should be processed promptly.
Answer: A
Explanation:
A criterion that requires all customer inquiries to be answered within 7 days of receipt permits accurate measurement of performance. The quantitative and specific nature of the appraisal using this standard avoids the vagueness, subjectivity, and personal bias that may afflict other forms of personnel evaluations.
NEW QUESTION # 191
Costs incurred by a manufacturer-lesser to negotiate a finance lease are:
- A. Expensed when selling profit is recognized.
- B. Deferred and allocated over the term of the lease in proportion to the recognition of rental income.
- C. Added to the gross investment in the lease.
- D. Allocated over the economic life of the leased asset.
Answer: A
Explanation:
The initial direct cost of negotiating and arranging a finance lease, e.g., commissions and legal fees, are included in the leas, receivable and allocated over the lease term.
However, similar costs of a manufacturer- or dealer-lesser incurred in negotiating and arranging a lease are excluded from initial direct costs. Thus, they are expensed when the soiling profit is recognized normally the start of the lease term IAS 17).
NEW QUESTION # 192
Organizational activities that complement each other and create a competitive advantage are called a:
- A. Strategic goal.
- B. Strategic fit.
- C. Joint venture.
- D. Merger.
Answer: B
Explanation:
Explanation/Reference:
NEW QUESTION # 193
All of the following are objectives of pricing except:
- A. Production maximization.
- B. Stabilization.
- C. Image oriented objectives.
- D. Profit maximization.
Answer: A
Explanation:
Pricing objectives include>
1.Profit maximization, which assumes that all firms select the price that results in the highest profit
2.Target margin maximization, which is stated as a percentage ratio of profits to sales
3.Volume-oriented objectives, which refers to setting prices to meet target sales volumes or market shares.
4.image oriented objectives, which refers to setting prices to enhance the consumer's perception of the firm's merchandise mix
5.Stabilization objectives, which refers to setting prices to maintain a stable relationship between the firm's prices and the industry leader's prices Price setting is not a factor in maximizing production.
NEW QUESTION # 194
Listening effectiveness is best increased by:
- A. Tuning out messages that do not seem to fit the meeting purpose.
- B. Factoring in biases in order to evaluate the information being given.
- C. Resisting both internal and external distractions.
- D. Waiting to review key concepts until the speaker has finished talking.
Answer: C
Explanation:
Explanation/Reference:
NEW QUESTION # 195
A U.S. company and a European company purchased the same stock on a European stock exchange and held the stock for one year. If the value of the euro weakened against the U.S dollar during the period, in comparison with the European company's return, the U.S company's return will be:
- A. Higher.
- B. The same.
- C. Indeterminate from the information provided.
- D. Lower.
Answer: D
Explanation:
Because the return to the U.S. company is adversely affected and the return to the European company is unaffected, the return to the U.S. company will definitely be lower than the return to the European company.
NEW QUESTION # 196
Which of the following is a disadvantage in a centralized organizational structure?
- A. Loss of economies of scale
- B. Slower decision making.
- C. Vulnerabilities in sharing knowledge
- D. Communication conflicts
Answer: A
NEW QUESTION # 197
In a large organization, the biggest risk in not having an adequately staffed information center help desk is:
- A. Persistent errors in user interaction with systems.
- B. Inadequate documentation for application systems.
- C. Increased difficulty in performing application audits.
- D. Increased likelihood of use of unauthorized program code.
Answer: A
Explanation:
The biggest risk in not having an adequately staffed help desk is that users will
unknowingly persist in making errors in their interaction with the information systems.
NEW QUESTION # 198
Which of the following statements most likely represents a disadvantage for an entity that keeps data files on a server rather than on a manual system?
- A. It is usually more difficult to compare recorded accountability with the physical count of assets.
- B. Attention is focused on the accuracy of the programming process rather than errors in individual transactions.
- C. It is usually easier for unauthorized persons to access and alter the files.
- D. Random error associated with processing similar transactions in different ways is usually greater.
Answer: C
Explanation:
In a manual system, one individual is usually assigned responsibility for maintaining and safeguarding the records. However, in a server environment, the data files may be subject to change by others without documentation or an indication of who made the changes.
NEW QUESTION # 199
If the manufacturing company decides to use its excess manufacturing capacity for the motors, the contribution or net benefit that could have been obtained from other alternative uses is referred to as:
- A. Opportunity costs.
- B. Residual income.
- C. Sunk costs.
- D. Separable costs.
Answer: A
Explanation:
Opportunity cost is the net benefit that could be obtained from the best alternative use of a resource. Accordingly, it is the benefit forgone by using that resource in a particular way.
NEW QUESTION # 200
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In order to be eligible to take the IIA-CIA-Part3 exam, candidates must have completed the IIA-CIA-Part1 and IIA-CIA-Part2 exams or have obtained a waiver. They must also meet the IIA's experience requirements, which vary depending on their educational background. Overall, the IIA-CIA-Part3 certification exam is a challenging but rewarding certification that can help internal auditors take their careers to the next level.
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