IIA-CIA-Part3 Free Practice Test

- (Exam Topic 2)
What would be the effect it an organization paid one of its liabilities twice during the year in error?

1. A. Assets liabilities and owners' equity would be understated
2. B. Assets net income and owners' equity would be unaffected
3. C. Assets and liabilities would be understated
4. D. Assets net income and owners' equity would be understated, but liabilities would be overstated

Correct Answer: B

- (Exam Topic 1)
Which of the following strategies would most likely prevent an organization from adjusting to evolving industry market conditions?

1. A. Specializing in proven manufacturing techniques that have made the organization profitable in the past.
2. B. Substituting its own production technology with advanced techniques used by its competitors.
3. C. Forgoing profits over a period of time to gain market share from its competitors.
4. D. Using the same branding to sell its products through new sales channels to target new markets.

Correct Answer: A

- (Exam Topic 2)
Which of the following statements is true regarding reversing entries in an accounting cycled

1. A. Reversing all previous closing adjustments is a mandatory step in the accounting cycle
2. B. Reversing entries should be completed at the end of the next accounting period after recording regular transactions of the period
3. C. Reversing entries are identical to the adjusting entries made in the previous period.
4. D. Reversing entries are the exact opposite of the adjustments made in the previous period.

Correct Answer: D

- (Exam Topic 1)
An organization has recorded the following profit and expenses: Profit before interest and tax
$200,000
Sales
$2,300,000
Purchases of materials
$700,000
Interest expenses
$30,000
If the value-added tax (VAT) rate is 20 percent and the corporate tax rate is 30 percent, which of the following is the amount of VAT that the organization has to pay?

1. A. $34,000
2. B. $51,000
3. C. $60,000
4. D. $320,000

Correct Answer: D

- (Exam Topic 2)
According to IIA guidance, which of the following is the correct order to conduct a business impact analysis (BIA) for the potential loss of an organization's network services''
* 1. identify resources and partners to provide required recovery services
* 2. Identify the business processes supporting the network functionality
* 3. Obtain approval of the BIA from the operating managers relative to their areas of responsibility
* 4. Identify the business impact if the network services cannot be performed

1. A. 1, 2, 3, 4
2. B. 2, 1, 4, 3
3. C. 2, 4, 1, 3
4. D. 4, 2, 1, 3

Correct Answer: B