IIA IIA-CIA-Part3 Quiz 11 Topic 7 Questions 51-55

Question: 1

When assessing the adequacy of a risk mitigation strategy, an internal auditor should consider which of the following?

1) Management's tolerance for specific risks.

2) The cost versus benefit of implementing a control.

3) Whether a control can mitigate multiple risks.

4) The ability to test the effectiveness of the control.

A1, 2, and 3

B1, 2, and 4

C1, 3, and 4

D2, 3, and 4

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Question: 2

Which of the following statements is true regarding the relationship between an individual's average tax rate and marginal tax rate?

AIn a regressive personal tax system, an individual's marginal tax rate is normally greater than his average tax rate.

BIn a regressive personal tax system, an individual's marginal tax rate is normally equal to his average tax rate.

CIn a progressive personal tax system, an individual's marginal tax rate is normally equal to his average tax rate.

DIn a progressive personal tax system, an individual's marginal tax rate is normally greater than his average tax rate.

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Question: 3

Which of the following engagement observations would provide the least motivation for management to amend or replace an existing cost accounting system?

AThe distorted unit cost of a service is 50 percent lower than the true cost, while the true cost is 50 percent higher than the competition's cost.

BThe organization is losing $1,000,000 annually because it incorrectly outsourced an operation based on information from its current system.

CThe cost of rework, hidden by the current system, is 50 percent of the total cost of all services.

D50 percent of total organizational cost has been allocated on a volume basis.

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Question: 4

Which of the following conflict resolution methods should be applied when the intention of the parties is to solve the problem by clarifying differences and attaining everyone's objectives?

AAccommodating.

BCompromising.

CCollaborating.

DCompeting.

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Question: 5

Which of the following is an example of a nonfinancial internal failure quality cost?

ADecreasing gross profit margins over time.

BForegone contribution margin on lost sales.

CDefective units shipped to customers.

DExcessive time to convert raw materials into finished goods.

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IIA IIA-CIA-Part3 Quiz:11 Topic:7 Questions:51-55