IIA CIA IIA-CIA-PART3-3P Questions & Answers

• Question 1:

  Which of the following stages of contracting focuses on aligning the markets with objectives of the organization?

  A. Initiation stage

  B. Bidding stage

  C. Development stage

  D. Negotiation stage

  Correct Answer: D

• Question 2:

  An internal auditor was asked to review an equal equity partnership In one sampled transaction Partner A transferred equipment into the partnership with a self-declared value of $10,000 and Partner B contributed equipment with a self- declared value of $15 000 The capital accounts of each partner were subsequently credited with S12,500. Which of the following statements is true regarding this transaction?

  A. The capital accounts of the partners should be increased by the original cost of the contributed equipment.

  B. The capital accounts should be increased using a weighted average based on the current percentage of ownership

  C. No action is needed as the capital account of each partner was increased by the correct amount

  D. The capital accounts of the partners should be increased by the fair market value of their contribution

  Correct Answer: D

• Question 3:

  Which of the following statements is true with regard to information protection?

  A. All personal information, by definition is considered to be sensitive, requiring specialized controls.

  B. Information is not considered personal if it can only be linked to or used to identify an individual indirectly.

  C. Individuals who provide personal information to organizations share in the risk of inappropriate disclosure.

  D. Good protection controls remove any restrictions on the quantity of personal information that can be collected

  Correct Answer: A

• Question 4:

  A restaurant deeded to expand its business to include delivery services rather than relying on third-party food delivery services. Which of the following best describes the restaurant's strategy?

  A. Diversification

  B. Vertical integration

  C. Risk avoidance

  D. Differentiation

  Correct Answer: B

• Question 5:

  Which of the following concepts of managerial accounting is focused on allocating overheads to products?

  A. Theory of constraints

  B. Just-in-time method

  C. Activity-based costing

  D. Break-even analysis

  Correct Answer: C

• Question 6:

  A bicycle manufacturer incurs a combination of fixed and variable costs with the production of each bicycle Which of the following statements true recording these costs?

  A. If the number of bicycles produced is increased by 15 percent, the variable cost per unit will increase proportionally

  B. The fixed cost per unit will vary directly based on the number of bicycles produced during the production cycle

  C. The total variable cost will vary proportionally and inversely with the number of bicycles produced during a production run

  D. If the number of bicycles produced is increased by 30 percent the fixed cost per unit will decline

  Correct Answer: D

• Question 7:

  Organization X owns a 38 percent equity stake in Organization Y. Which of the following statements is true regarding the financial treatment for this relationship?

  A. Y should be listed as an investment asset on X's balance sheet

  B. X must consolidate the financial statements for both organizations

  C. Y should be reported as a footnote to X's financial statements

  D. Y should not be reported by X as X does not have a controlling interest

  Correct Answer: A

• Question 8:

  During which phase of the contacting process ate contracts drafted for a proposed business activity?

  A. Initiation phase

  B. Bidding phase

  C. Development phase

  D. Management phase

  Correct Answer: A

• Question 9:

  What kind of strategy would be most effective for an organization to adopt in order to implement a unique advertising campaign for selling identical product lines across all of its markets?

  A. Export strategy

  B. Transnational strategy.

  C. Multi-domestic strategy

  D. Globalization strategy.

  Correct Answer: C

• Question 10:

  Which of the following types of data analytics would be used by a hospital to determine which patients are likely to require readmittance for additional treatment?

  A. Predictive analytics

  B. Prescriptive analytics

  C. Descriptive analytics

  D. Diagnostic analytics

  Correct Answer: A