Free CIA Part 3 Exam Questions and Answers PDF 2024

Question #1

An entity has daily cash receipts of US $100,000 and collection time of 2 days. A bank has offered to reduce the collection time on the entity's deposits by 2 days for a monthly fee of US $500. If money market rates are expected to average 6% during the year, the net annual benefit loss) from having this service is:

A. S $3,000

B. S $12,000

C. S $0

D. S $6,000

View answer

Correct Answer: D

Question #2

The correct equation for calculating the approximate percentage cost, on an annual basis, of not taking trade discounts is

A. ption A

B. ption B

C. ption C

D. ption D

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Correct Answer: A

Question #3

If a series of profit lines for X and Y are drawn on the graph, the mix of X and Y that will result in the maximum profit can be determined from?

A. he last point in the feasible solution region touched by a profit line

B. ny point on the boundary of the feasible solution region touched by a profit line

C. he first point on the feasible solution region boundary that intersects a profit line

D. ny point on the demand constraint that intersects a profit line

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Correct Answer: A

Question #4

A major disadvantage of the life cycle approach to system development is that it is not well-suited for projects that are:

A. tructured

B. arge

C. omplex

D. nstructured

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Correct Answer: D

Question #5

The best evidence that contingency planning is effective is to have:

A. omprehensive documentation of the plan

B. ignoff on the plan by the internal audit activity

C. uccessful testing of the plan

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Correct Answer: C

Question #6

The value of the domestic currency in relation to foreign currencies is:

A. etermined directly by the price of gold because the value of the domestic currency is tied to the price of gold

B. et by the domestic government in consultation with foreign governments

C. et along with the value of other currencies held by the International Monetary Fund

D. etermined by the forces of supply and demand on the foreign exchange markets

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Correct Answer: D

Question #7

The best evidence that contingency planning is effective is to have:

A. o processing interruptions during the past year

B. omprehensive documentation of the plan

C. ign off on the plan by the internal audit activity

D. uccessful testing of the plan

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Correct Answer: D

Question #8

All of the following are generally included in a cost-of-quality report except:

A. arranty claims

B. esign engineering

C. upplier evaluations

D. ost contribution margin

View answer

Correct Answer: D

Question #9

A bank is developing a computer system to help evaluate loan applications. The information systems IS staff interview the bank's mortgage underwriters to extract their knowledge and decision processes for input into the computer system. The completed system should be able to process information the same as do the underwriters and make final recommendations regarding loan decisions. This approach is called:

A. n expert system

B. neural network

C. n intelligent agent

D. uzzy logic

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Correct Answer: A

Question #10

The internal auditor found that the purchasing department has a policy of setting all purchasing lead times to the highest number of days experienced within each product subassembly}, even though some subassemblies required 3 or more months to complete. To address the objective of reducing inventory holding costs related to this policy, the internal auditor should focus on:

A. eviewing production requirements for a sample of products to determine at which point in the production process materials and subassemblies are needed

B. valuating whether product-line assignments were rotated among the members of the purchasing department

C. dentifying signature approval authority} among members of the purchasing department in relation to any computer system controls

D. esting those products having the highest sales to determine the average number of days that the completed products were held in inventory

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Correct Answer: A

Question #11

Which of the following is not a required element of a contract?

A. egality

B. onsideration

C. egal capacity

D. writing

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Correct Answer: D

Question #12

Which of the following is usually a benefit of using electronic funds transfer EFT) for international cash transactions?

A. mprovement of the audit trail for cash receipts and disbursements

B. reation of self-monitoring access controls

C. eduction of the frequency of data entry errors

D. ff-site storage of source documents for cash transactions

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Correct Answer: C

Question #13

Which of the following is a key to successful total quality management?

A. raining quality inspectors

B. ocusing intensely on the customer

C. reating appropriate hierarchies to increase efficiency

D. stablishing a well-defined quality standard, then focusing on meeting it

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Correct Answer: B

Question #14

An entity's receivables collection period is equal to the:

A. nventory conversion period

B. ash conversion cycle

C. ay's sales outstanding

D. nventory divided by average daily sales

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Correct Answer: C

Question #15

In forecasting purchases of inventory for a firm, all of the following are useful except:

A. nowledge of the behavior of business cycles

B. nternal allocations of costs to different segments of the firm

C. nformation on the seasonal variations in demand

D. conometric modeling

View answer

Correct Answer: B

Question #16

Which of the following classes of securities are listed in order from lowest risk/opportunity for return to highest risk/opportunity for return?

A. orporate first mortgage bonds; corporate income bonds; preference shares

B. orporate income bonds: corporate mortgage bonds: subordinated debentures

C. rdinary shares; corporate first mortgage bonds, corporate second mortgage bonds

D. reference shares; ordinary shares; corporate debentures

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Correct Answer: A

Question #17

Company F produces and sells two products. Product A costs US $10 per unit and Product B costs US $5 per unit. Product A is selling very well, but sales of Product B are low. In order to increase sales of Product B, Company F has begun setting a price of US $13 for one of each.What is the pricing method?

A. roduct-bundle pricing

B. y-product pricing

C. alue pricing

D. ollusive pricing

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Correct Answer: A

Question #18

Which of the following "families" of controls is not described in The IIA's Global Technology Audit Guide (GTAG) 1, titled information Technology Controls?

A. overnance, management, and technical controls

B. reventive, detective, and corrective controls

C. eedback, concurrent, and feedforward controls

D. T general and application controls

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Correct Answer: C

Question #19

Which of the following correctly describes the introduction of a government tax credit on investments?

A. orporate investments will have higher net present values, all else equal, than without the tax credit

B. ax credits on investments are designed to restrain inflation

C. ax credits on investments increase investment costs, and all else equal, reduce the level of corporate investment

D. ax credits on investments are taxes that are typically levied on individual projects rather than on groups of projects

View answer

Correct Answer: A

Question #20

Which of the following is an encryption feature that can be used to authenticate the originator of a document and ensure that the message is intact and has not been tampered with?

A. euristic terminal

B. erimeter switch

C. efault settings

D. igital signatures

View answer

Correct Answer: D

Question #21

The four categories of costs associated with product quality costs are:

A. xternal failure, internal failure, prevention, and carrying

B. xternal failure, internal failure, prevention, and appraisal

C. xternal failure, internal failure, training, and appraisal

D. arranty, product liability, training, and appraisal

View answer

Correct Answer: B

Question #22

A manufacturing company produces plastic utensils for a particular segment at the lowest possible cost. The company is pursuing a cost:

A. eadership strategy

B. ocus strategy

C. ifferentiation strategy

D. ontainment strategy

View answer

Correct Answer: B

Question #23

Which of the following is a computer program that appears to be legitimate but performs some illicit activity when it is run?

A. oax virus

B. eb crawler

C. rojan horse

D. iller application

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Correct Answer: C

Question #24

A computer company charges indirect manufacturing costs to a project at a fixed percentage of a cost pool. This project is covered by a cost-plus government contract.Which of the following is an appropriate guideline for determining how costs are assigned to the pool?

A. stablish separate pools for variable and fixed costs

B. ssign prime costs and variable administrative costs to the same pool

C. stablish a separate pool for each assembly line worker to account for wages

D. ssign all manufacturing costs related to the project to the same pool

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Correct Answer: A

Question #25

In which stage of an entity's development is it most likely to seek and obtain external equity financing in the form of venture capital?

A. ormation

B. apid growth

C. rowth to maturity

View answer

Correct Answer: B

Question #26

What is the overall audit objective when auditing an e-commerce activity?

A. o ensure that all e-commerce processes have efficient internal controls

B. o ensure that all e-commerce processes have effective internal controls

C. o ensure that all e-commerce processes are adequate to fulfill their intended objectives

D. o ensure that all e-commerce processes meet the functionality requirements of the end users

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Correct Answer: B

Question #27

A small company has changed from a system of recording time worked on clock cards to a computerized payroll system in which employees record time in and out with magnetic cards. The computer system automatically updates all payroll records. Because of this change,

A. generalized computer audit program must be used

B. art of the audit trail is altered

C. he potential for payroll-related fraud is diminished

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Correct Answer: B

Question #28

An entity has a high fixed-assets turnover ratio.What conclusion can a financial analyst draw from this?

A. he entity may be overcapitalized

B. he entity may have a problem with employees converting inventory to personal use

C. he entity may be undercapitalized

D. he entity has favorable profitability

View answer

Correct Answer: C

Question #29

During the past few years, Wilder Company has experienced the following average number of power outages:Each power outage results in out-of-pocket costs of US $800. For US $1,000 per month, Wilder can lease a generator to provide power during outages. If Wilder leases a generator in the coming year, the estimated savings (or additional expense) for the year will be

A. S $(15,200)

B. S $(1,267)

C. S$3,200

D. S$7,200

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Correct Answer: C

Question #30

A bank plans to open a branch in one of five locations (labeled L1, L2, L3, L4, L5). Demand for bank services may be high, medium, or low at each of these locations. Profits for each location- demand combination are presented in the payoff matrix.If, in addition to the estimated profits .management of the bank assesses the probabilities of high, medium, and low demands to be 0.3.0.4, and 0.3, respectively, what is the expected opportunity loss from selecting location L4?

A. S$5

B. S$7

C. S$7

D. S$5

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Correct Answer: A

Question #31

An organization has a compensation system for its managers based on a management-objectives MBO) approach. The essential premise of MBO is that:

A. ompensation should be based on qualitative factors

B. mployees should be concerned with routine matters, and managers should attend to exceptions

C. mployees should participate in setting objectives

D. anagers should establish objectives for their employees

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Correct Answer: C

Question #32

Data regarding four different products manufactured by an organization are presented as follows. Direct material and direct labor are readily available from the respective resource markets.However, the manufacturer is limited to a maximum of 3,000 machine hours per month.Units Produced per Machine Hour: A: 3 B: 4 C: 2 D: 3The product that is the most profitable for the manufacturer in this situation is

A. roduct A

B. roduct B

C. roduct C

D. roduct D

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Correct Answer: B

Question #33

In preparing the annual profit plan for the coming year.What is the percentage of the total variance that can be explained by the regression equation?

A. 9

B. 9

C. 0

D. 9

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Correct Answer: A

Question #34

An electronic meeting conducted between several parties at remote sites is referred to as:

A. eleprocessing

B. nteractive processing

C. elecommuting

D. eleconferencing

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Correct Answer: D

Question #35

In the standard regression equation y = a + bx, how is the letter b best described?

A. ndependent Variable

B. ependent Variable

C. onstant coefficient

D. ariable coefficient

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Correct Answer: D

Question #36

Which of the following will allow a manufacturer with limited resources to maximize profits?

A. he Delphi technique

B. xponential smoothing

C. egression analysis

D. inear programming

View answer

Correct Answer: D

Question #37

If A has 60 ordinary shares outstanding, it has a book value per share of approximately.

A. S $1

B. S $2

C. S $4

D. S $5

View answer

Correct Answer: C

Question #38

Which of the following is a major element of the ISO 9000:2008 quality management system standards?

A. he principle that improved employee satisfaction will lead to increased productivity

B. he attitude and actions of the board and management regarding the significance of control within the organization

C. he assessment of the risk that objectives are not achieved

D. requirement for organizations to monitor information on customer satisfaction as a measure of performance

View answer

Correct Answer: D

Question #39

The expected value of perfect information is the:

A. ame as the expected profit under certainty

B. um of the conditional profit loss) for the best event of each act times the probability of each event occurring

C. ifference between the expected profit under certainty and the expected opportunity loss

D. ifference between the expected profit under certainty and the expected monetary value of the best act under uncertainty:

View answer

Correct Answer: D

Question #40

Passwords far personal computer software programs are designed to prevent:

A. naccurate processing of data

B. nauthorized access to the computer

C. ncomplete updating of data files

D. nauthorized use of the software

View answer

Correct Answer: D

Question #41

In a theory of constraints (TOC) analysis, the bottleneck operation (the constraint) corresponds to which part of the drum-buffer-rope model?

A. rum

B. uffer

C. ope

D. o part of TOC analysis corresponds to the drum-buffer-rope model

View answer

Correct Answer: B

Question #42

Electronic commerce e-commerce) is generally defined as "conducting commercial activities over the Internet." These commercial activities can be all but which of the following?

A. usiness-to-business

B. usiness-to-consumer

C. usiness-to-employee

D. onsumer-to-business

View answer

Correct Answer: D

Question #43

An inventory planning method that minimizes inventories by arranging to have raw materials and subcomponents arrive immediately preceding their use is called:

A. safety stock planning system

B. n economic order quantity model

C. just-in-time inventory system

D. master budgeting system

View answer

Correct Answer: C

Question #44

Activity scheduling information for the installation of a new computer system is given below.For this project, the critical path is:

A. -C

B. -E

C. -D-E

D. -D-C

View answer

Correct Answer: C

Question #45

Responsibility for the control of end-user computing EUC) exists at the organizational, departmental, and individual user level.Which of the following should be a direct responsibility of the individual users?

A. cquisition of hardware and software

B. aking equipment inventories

C. trategic planning of end-user computing

D. hysical security of equipment

View answer

Correct Answer: D

Question #46

One consequence of the imposition of tariffs or quotas on imported products is:

A. ower prices for domestic products that compete with affected imports

B. omestic industry opposition to protection from imports

C. dditional consumption of the affected imported products

D. igher prices for the affected imported products

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Correct Answer: D

Question #47

A principal advantage of an ERP system is:

A. rogram-data dependence

B. ata redundancy

C. eparate data updating for different functions

D. entralization of data

View answer

Correct Answer: D

Question #48

A service entity's working capital at the beginning of January was 70,000. The following transactions occurred during January.What is the amount of working capital at the end of January?

A. S $80,500

B. S $78,500

C. S $50,500

D. S $47,500

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Correct Answer: A

Question #49

Philip Enterprises, distributor of compact disks (CDs), is developing its budgeted cost of goods sold. Philip has developed the following range of sales estimates and associated probabilities for the year:Philip's cost of goods sold averages 80% of sales.What is the expected value of Philip's budgeted cost of goods sold?

A. S$85,000

B. S$84,000

C. S$68,000

D. S$67,200

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Correct Answer: D

Question #50

The following account balances represent the December 31 balance sheet of an entity. The quick ratio for this year is:

A.

B.

C.

D.

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Correct Answer: C

Question #51

When a multinational entity decides to sell its products abroad, one of the risks it faces is that the government of the foreign market charges the entity with dumping. Dumping occurs when:

A. he same product sells at different prices in different countries

B. n entity charges less than it costs to make the product to enter or win a market

C. ower quality versions of the product are sold abroad so as to be affordable

D. ransfer prices are set artificially high so as to minimize tax payments

View answer

Correct Answer: B

Question #52

When faced with the problem of filling a newly created or recently vacated executive position, organizations must decide whether to promote from within or to hire an outsider.One of the disadvantages of promoting from within is that:

A. nternal promotions can have negative motivational effect on the employees of the firm

B. nternal promotions are more expensive to the organization than hiring an outsider

C. t is difficult to identify proven performers among internal candidates

D. iring an insider leads to the possibility of social inbreeding within the firm

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Correct Answer: D

Question #53

When managing cash and short-term investments, a corporate treasurer is primarily concerned with:

A. aximizing rate of return

B. inimizing taxes

C. nvesting in government bonds since they have no default risk

D. iquidity and safety

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Correct Answer: D

Question #54

A German importer of English clothing has contracted to pay an amount fixed in British pounds 3 months from now. lithe importer worries that the euro may depreciate sharply against the British pound in the interim, it would be well advised to:

A. uy pounds in the forward exchange market

B. ell pounds in the forward exchange market

C. uy euros in the futures market

D. ell euros in the futures market

View answer

Correct Answer: A

Question #55

A working capital technique that increases the payable float and therefore delays the outflow of cash is:

A. oncentration banking

B. draft

C. lectronic Data Interchange EDO

D. lockbox system

View answer

Correct Answer: B

Question #56

All of the following are stages of the business cycle except:

A. oom, or peak

B. rough

C. ecovery

D. cceleration

View answer

Correct Answer: D

Question #57

If the exchange rate has changed from 1 local currency unit LCU) to 5 foreign currency unitsFCUs) to a rate of 1 LCU to 5.5 FCUs,

A. he LCU has appreciated by 10%

B. he LCU has depreciated by 10%

C. he FCU has appreciated by 20%

D. he FCU has depreciated by 20%

View answer

Correct Answer: A

Question #58

Which of the following is true concerning HTML?

A. he acronym stands for HyperText Material Listing

B. he language is among the most difficult to learn

C. he language is independent of hardware and software

D. TML is the only language that can be used for Internet documents

View answer

Correct Answer: C

Question #59

In a product's life cycle, the first symptom of the decline stage is a decline in the:

A. ntity's inventory levels

B. roduct's sales

C. roduct's production cost

D. roduct's prices

View answer

Correct Answer: B

Question #60

Which of the following should the auditor recommend as the most economical point at which to correct input errors in an online system?

A. nput data are balanced with computer-produced control totals

B. ntry of data into each field of a record is completed

C. utput data are balanced with computer-produced control totals and delivered to the user

D. ntry of data into each record is completed

View answer

Correct Answer: B

Question #61

Which one of the graphs depicts the demand curve for prestige goods?

A. ption A

B. ption C

C. ption C

D. ption D

View answer

Correct Answer: C

Question #62

Which of the following is the method of adding a standard markup to the cast of the product?

A. enetration pricing

B. oing-rate pricing

C. ost-based pricing

D. rice skimming

View answer

Correct Answer: C

Question #63

Market-skimming pricing strategies could be appropriate when:

A. o buyers want the product at a high price

B. he costs of producing a small volume are low

C. ompetitors can easily enter the market

D. he product is of poor quality

View answer

Correct Answer: B

Question #64

Just-in-time JIT) inventory systems have been adopted by large manufacturers to minimize the carrying costs of inventories. Identify the primary vulnerability of JIT systems.

A. omputer resources

B. aterials supply contracts

C. ork stoppages

D. mplementation time

View answer

Correct Answer: C

Question #65

Only two companies manufacture Product A. The finished product is identical regardless of which company manufactures it. The cost to manufacture Product A is US$1, and the selling price is US $2. One company considers reducing the price to achieve 100% market share but fears the other company will respond by further reducing the price. Such a scenario would involve a:

A. o-win strategy

B. ual-win strategy

C. ne win-one lose strategy

D. eutral strategy

View answer

Correct Answer: A

Question #66

Which of the following characteristics distinguishes computer processing from manual processing?

A. omputer processing virtually eliminates the occurrence of computational error normally associated with manual processing

B. rrors or fraud in computer processing will be detected soon after their occurrence

C. he potential for systematic errors is ordinarily greater in manual processing than in computerized processing

D. ost computer systems are designed so that transaction trails useful for audit purposes do not exist

View answer

Correct Answer: A

Question #67

With regard to inventory management, an increase in the frequency of ordering will normally:

A. educe the total ordering costs

B. ave no impact an total ordering costs

C. educe total carrying costs

D. ave no impact on total carrying costs

View answer

Correct Answer: C

Question #68

The economic order quantity is the size of the order that minimizes total inventory costs which include ordering and holding carrying) costs. It can be calculated using the formulaIf Q = order size in units, D = annual demand in units, p = cost per purchase order, s = carrying cost per year for one unit of inventory. If the annual demand decreases by 369/o the optimal order size will:

A. ecrease by 20%

B. ncrease by 20°!a

C. ncrease by 6%

D. ecrease by 6%

View answer

Correct Answer: A

Question #69

The decision rule that selects the strategy with the highest utility payoff if the worst state of nature occurs is the:

A. inimize regret rule

B. aximize utility rule

C. aximinrule

D. aximaxrule

View answer

Correct Answer: C

Question #70

A control for ensuring that the source code and the executable code for a program match is:

A. erifying that the program move request is authorized

B. equiring program, system, and parallel testing of the code

C. uthorizing programmer access to test libraries only

D. ecompiling source code into the production load library

View answer

Correct Answer: D

Question #71

In a traditional manufacturing operation, direct costs would normally include:

A. achine repairs in an automobile factory

B. lectricity in an electronics plant

C. ood in a furniture factory

D. ommissions paid to sales personnel

View answer

Correct Answer: C

Question #72

All of the following are generally included in a cost-of-quality report except:

A. arranty claims

B. esign engineering

C. upplier evaluations

D. ost contribution margin

View answer

Correct Answer: D

Question #73

A domestic entity and a foreign entity purchased the same stock on the foreign stock exchange and held the stock for 1 year. The value of the foreign currency weakened against the domestic currency over this period. Comparing the returns of the two companies, what will be the domestic entity's return?

A. ower

B. igher

C. he same

D. igher in the short-run but lower in the long-run

View answer

Correct Answer: A

Question #74

Compared with prototyping, life cycle methodologies are appropriate for problems involving:

A. igh user understanding of tasks and large project size

B. ow user understanding of tasks and small project size

C. ow user understanding of tasks and uncertainty of requirements

D. ncertainty of requirements and large project size

View answer

Correct Answer: A

Question #75

Responsibility for the control of end-user computing EUC) exists at the organizational, departmental, and individual user level.Which of the following should be a direct responsibility of the individual users?

A. cquisition of hardware and software

B. aking equipment inventories

C. trategic planning of end-user computing

D. hysical security of equipment

View answer

Correct Answer: D

Question #76

As part of a risk analysis, an auditor wishes to forecast the percentage growth in next month's sales for a particular plant using the past 30 months" sales results. Significant changes in the organization affecting sales volumes were made within the last 9 months. The most effective analysis technique to use would be:

A. nweighted moving average

B. xponential smoothing

C. ueuing theory

D. inear regression analysis

View answer

Correct Answer: B

Question #77

Which of the following may provide a leading indicator of a future increase in gross domestic product?

A. reduction in the money supply

B. decrease in the issuance of building permits

C. n increase in the timeliness of delivery by vendors

D. n increase in the average hours worked per week of production workers

View answer

Correct Answer: D

Question #78

The process of monitoring evaluating, and modifying a system as needed is referred to as systems:

A. nalysis

B. easibility study

C. aintenance

D. mplementation

View answer

Correct Answer: C

Question #79

Response time on a local area network LAN) was so slow that programmers working on applications kept their code on their own workstations rather than on the server. As a result, daily backups of the server did not contain the current source code. The best approach to detect deteriorating response time is:

A. arallel testing

B. ntegrated test facility

C. erformance monitoring

D. rogram code comparison software

View answer

Correct Answer: C

Question #80

A company manufactures banana hooks for retail sale. The bill of materials for this item and the parts inventory for each material required are as follows:

A. ption A

B. ption B

C. ption C

D. ption D

View answer

Correct Answer: B

Question #81

Which of the following is a product cost for a manufacturing company?

A. nsurance on the corpor

B. roperty taxes on a fact

C. epreciation on a salesperson's vehicle

D. he salary of a sales manager

View answer

Correct Answer: B

Question #82

Management of a company is attempting to build a reputation as a world-class manufacturer of quality products.Which of the following measures would not be used by the firm to measure quality?

A. he percentage of shipments returned by customers because of poor quality

B. he number of parts shipped per day

C. he number of defective parts per million

D. he percentage of products passing quality tests the first time

View answer

Correct Answer: B

Question #83

Which of the following is an economic rationale for government intervention in trade?

A. aintaining spheres of influence

B. rotecting infant industries

C. reserving national identity

D. ealing with friendly countries

View answer

Correct Answer: B

Question #84

The Internet consists of a series of networks that include:

A. ateways to allow personal computers to connect to mainframe computers

B. ridges to direct messages through the optimum data path

C. epeaters to physically connect separate local area networks LANs

D. outers to strengthen data signals between distant computers

View answer

Correct Answer: A

Question #85

A nation has a progressive tax structure with income tax brackets that are not indexed to inflation. An individual taxpayer experiences an income increase just equal to the general inflation rate moves into a higher tax bracket. The individual taxpayer will then experience -List A- nominal taxes payable and- List B- real taxes payable.

A. ption A

B. ption B

C. ption C

D. ption D

View answer

Correct Answer: A

Question #86

Which statement beet describes the emphasis of total quality management TQM)?

A. educing the cast of inspection

B. mplementing better statistical quality control techniques

C. oing each job right the first time

D. ncouraging crass-functional teamwork

View answer

Correct Answer: C

Question #87

Total quality management in a manufacturing environment is best exemplified by:

A. dentifying and reworking production defects before sale

B. esigning the product to minimize defects

C. erforming inspections to isolate defects as early as possible

D. aking machine adjustments periodically to reduce defects

View answer

Correct Answer: B

Question #88

Which of the following actions would best address a concern that data uploaded from a desktop computer may be erroneous?

A. he mainframe computer should be backed up on a regular basis

B. wo persons should be present at the desktop computer when it is uploading data

C. he mainframe computer should subject the data to the same edits and validation routines that online data entry would require

D. sers should be required to review a random sample of processed data

View answer

Correct Answer: C

Question #89

What type of computer processing system is characterized by data that are assembled from more than one location and records that are updated immediately?

A. ersonal computer systems

B. ata compression systems

C. atch processing systems

D. nline, real-time systems

View answer

Correct Answer: D

Question #90

An organization has adopted the robust quality approach. According to this view of quality,

A. he minimum point on the total quality cost curve occurs when conformance cost per unit equals nonconformance cost per unit

B. mproving quality requires tradeoffs among categories of quality costs

C. eyond some point, incurrence of prevention and appraisal costs is not cost beneficial

D. osts in all categories of quality costs may be reduced while improving quality

View answer

Correct Answer: D

Question #91

A computer company charges indirect manufacturing costs to a project at a fixed percentage of a cost pool. This project is covered by a cost-plus government contract.Which of the following is an appropriate guideline for determining how costs are assigned to the pool?

A. stablish separate pools for variable and fixed costs

B. ssign prime costs and variable administrative costs to the same pool

C. stablish a separate pool for each assembly line worker to account for wages

D. ssign all manufacturing costs related to the project to the same pool

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Correct Answer: A

Question #92

Security of monetary transactions is one example of an audit objective for an e-commerce engagement.Which of the following is not an audit objective for an e-commerce engagement?

A. ffective use and control of digital signatures

B. dequacy and timeliness of operating data and information

C. ffectiveness of customer authentication process

D. ppropriateness of reporting lines

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Correct Answer: D

Question #93

An Internet firewall is designed to provide adequate protection against which of the following?

A. computer virus

B. nauthenticated logins from outside users

C. nsider leaking of confidential information

D. Trojan horse application

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Correct Answer: B

Question #94

An entity must select from among several methods of financing arrangements when meeting its capital requirements. To acquire additional growth capital while attempting to maximize earnings per share, an entity should normally

A. ttempt to increase both debt and equity in equal proportions, which presences a stable capital structure and maintains investor confidence

B. elect debt over equity initially, even though increased debt is accompanied by interest costs and a degree of risk

C. elect equity over debt initially, which minimizes risk and avoids interest costs

D. iscontinue dividends and use current cash flow, which avoids the cost and risk of increased debt and the dilution of EPS through increased equity

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Correct Answer: B

Question #95

Is PERT analysis a control tool or a planning tool?

A. ption A

B. ption C

C. ption C

D. ption D

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Correct Answer: B

Question #96

Many companies recognize three major categories of costs of manufacturing a product. These are direct materials, direct labor, and overhead.Which of the following is an overhead cost in the production of an automobile?

A. he cost of small tools used in mounting tires on each automobile

B. he cost of the tires on each automobile

C. he cost of the laborers who place tires on each automobile

D. he delivery costs for the tires on each automobile

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Correct Answer: A

Question #97

If the government of a country uses its foreign currency reserves to

A. ption A

B. ption B

C. ption C

D. ption D

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Correct Answer: B

Question #98

CASE computer-aided software engineering) is the use of the computer to aid in the development of computer-based information systems.Which of the following could not be automatically generated with CASE tools and techniques?

A. nformation requirements determination

B. rogram logic design

C. omputer program code

D. rogram documentation

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Correct Answer: A

Question #99

Which of the following is a characteristic of total quality management (TQM)?

A. anagement by objectives

B. n-the-job training by other workers

C. uality by final inspection

D. ducation and self-improvement

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Correct Answer: D

Question #100

Which of the following should the auditor recommend as the most economical point at which to correct input errors in an online system?

A. nput data are balanced with computer-produced control totals

B. ntry of data into each field of a record is completed

C. utput data are balanced with computer-produced control totals and delivered to the user

D. ntry of data into each record is completed

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Correct Answer: B

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