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IIA-CIA-Part3 Learning Material: Business Knowledge for Internal Auditing & IIA-CIA-Part3 Practice Test

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IIA Business Knowledge for Internal Auditing Sample Questions (Q147-Q152):

NEW QUESTION # 147
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. Consumer-to-business.
B. Business-to-consumer
C. Business-to-business
D. Business-to-employee

Answer: A

Explanation:
These commercial activities can be business-to-business B2B), business-to-consumer (B2C), and business-to-employee B2E). Consumer-to-business is not a commercial activity because it does not originate from a business, therefore, it is not considered part of e-commerce.

NEW QUESTION # 148
In terms of international business strategy, which of the following is true regarding a multi-domestic strategy?

A. It uses the same products in all countries.
B. It provides cost advantages, improves coordinated activities, and speeds product development.
C. It centralizes control with little decision-making authority given to the local level.
D. It is an effective strategy when large differences exist between countries.

Answer: D

NEW QUESTION # 149
An internal auditor reviews a data population and calculates the mean, median, and range. What is the most likely purpose of performing this analytic technique?

A. To determine whether duplicates in the data inflate the range.
B. To determine the completeness and accuracy of the data.
C. To identify whether the population contains outliers.
D. To inform the classification of the data population.

Answer: C

NEW QUESTION # 150
Which of the following is a cybersecurity monitoring activity that involves assessing the strength of an organization's IT protection?

A. Boundary defense
B. Malware defense
C. Wireless access controls
D. Penetration tests

Answer: A

NEW QUESTION # 151
The high cost of short-term financing has recently caused an entity to reevaluate the terms of credit it extends to its customers. The current policy is 1/10, net 60. If customers can borrow at the prime rate, at what prime rate must the entity change its terms of credit in order to avoid an undesirable extension in its collection of receivables?

A. 8%
B. 5%
C. 7%
D. 2%

Answer: A

Explanation:
Terms of 1/10, net 60 mean that a buyer can save 1% of the purchase price by paying 50 days early. In essence, not taking the discount results in the buyer's borrowing 99% of the in price for 50 days at a total interest charge of 1% of the invoice price. Because a year has 7.3 50-day per periods 365 50), the credit terms 1/10, net 60 yield an effective annualized interest charge of approximately 7.371 [(I% 99%) 7.3]. If the prime rate were higher than 7.37%, the buyer would prefer to borrow from the vendor i.e., not pay within the discount period) rather than from a bank. Consequently, an 8% prime rate could cause the vendor's receivables to increase. An entity sells 10,000 skateboards a year at US $66 each. All sales are on credit, with terms of 3/10. net 30, which means three percent discount if percent it is made within 10 days; otherwise full payment is due at the end of 30 days. One half of the customers are expected to take advantage of the discount and pay on day 10. The other half are expected to pay on day 30. Sales are ,, ict id to be uniform throughout the year for both types of customers.

NEW QUESTION # 152
......

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Lou Smith Lou Smith

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