[Free] Download New Updated (October 2016) IIA IIA-CIA-Part3 Real Exam 41-50

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QUESTION 41

All of the following are true with regard to the first-in, first-out inventory valuation method except:

 

A.

It values inventory close to current replacement cost.

B.

It generates the highest profit when prices are rising.

C.

It approximates the physical flow of goods.

D.

It minimizes current-period income taxes.

 

Correct Answer: D

 

 

QUESTION 42

Which of the following is not a common feature of cumulative preferred stock?

 

A.

Priority over common stock with regard to dilution of shares.

B.

Priority over common stock with regard to earnings.

C.

Priority over common stock with regard to dividend payment.

D.

Priority over common stock with regard to assets.

 

Correct Answer: A

 

 

 

QUESTION 43

Which of the following costs would be incurred in an inventory stockout?

 

A.

Lost sales, lost customers, and backorder.

B.

Lost sales, safety stock, and backorder.

C.

Lost customers, safety stock, and backorder.

D.

Lost sales, lost customers, and safety stock.

 

Correct Answer: A

 

 

QUESTION 44

Where complex problems need to be addressed, which of the following communication networks would be most appropriate?

 

A.

Chain.

B.

All-channel.

C.

Circle.

D.

Wheel.

 

Correct Answer: B

 

 

QUESTION 45

The process of scenario planning begins with which of the following steps?

 

A.

Determining the trends that will influence key factors in the organization’s environment.

B.

Selecting the issue or decision that will impact how the organization conducts future business.

C.

Selecting leading indicators to alert the organization of future developments.

D.

Identifying how customers, suppliers, competitors, employees, and other stakeholders will react.

 

Correct Answer: B

 

 

QUESTION 46

One change control function that is required in client/server environments, but is not required in mainframe environments, is to ensure that:

 

A.

Program versions are synchronized across the network.

B.

Emergency move procedures are documented and followed.

C.

Appropriate users are involved in program change testing.

D.

Movement from the test library to the production library is controlled.

 

Correct Answer: A

 

 

QUESTION 47

Which of the following is a strategy that organizations can use to stimulate innovation?

 

1. Source from the most advanced suppliers.

 

2. Establish employee programs that reward initiative.

 

3. Identify best practice competitors as motivators.

 

4. Ensure that perfor
mance targets are always achieved.

 

A.

1 and 3 only

B.

2 and 4 only

C.

1, 2, and 3 only

D.

1, 2, 3, and 4

 

Correct Answer: C

 

 

QUESTION 48

An organization produces two products, X and Y. The materials used for the production of both products are limited to 500 kilograms (kg) per month. All other resources are unlimited and their costs are fixed. Individual product details are as follows:

 

Product X

 

Product Y

 

Selling price per unit

 

$10

 

$13

 

Materials per unit (at $1/kg)

 

2 kg

 

6 kg

 

Monthly demand

 

100 units

 

120 units

 

In order to maximize profit, how much of product Y should the organization produce each month?

 

A.

50 units.

B.

60 units.

C.

100 units.

D.

120 units.

 

Correct Answer: A

 

 

QUESTION 49

Preferred stock is less risky for investors than is common stock because:

 

A.

Common stock pays dividends as a stated percentage of face value.

B.

Common stock has priority over preferred stock with regard to earnings and assets.

C.

Preferred dividends are usually cumulative.

D.

Preferred stock with no conversion feature has a higher dividend yield than does convertible preferred stock.

 

Correct Answer: C

 

 

QUESTION 50

According to IIA guidance on IT auditing, which of the following would not be an area examined by the internal audit activity?

 

A.

Access system security.

B.

Policy development.

C.

Change management.

D.

Operations processes.

 

Correct Answer: B

 

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