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IIA IIA-ACCA Questions Answers

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Question 88

In the current year, a merchandising organization had an inventory turnover ratio of 3.0, which was less than the industry average of 6.5. Which of the following offers the most likely explanation for this difference?

Options:

A.

The organization has understated the amount of inventory in its financial statements

B.

The organization has overstated the cost of purchases in its financial statements.

C.

The organization is holding obsolete or damaged items in its inventory

D.

The organization experienced an unexpectedly large increase in sales shortly before year end.

Question 89

Which of the following performance measures would be appropriate for evaluating an investment center, which has responsibility for its revenues, costs, and investment base, but would not be appropriate for evaluating cost, revenue, or profit centers?

Options:

A.

A flexible budget.

B.

Variance analysis.

C.

A contribution margin income statement by segment.

D.

Residual income.

Question 90

An organization is considering the outsourcing of its business processes related to payroll and information technology functions. Which of the following is the most significant area of concern for management regarding this proposed agreement?

Options:

A.

Ensuring that payments to the vendor are appropriate and timely for the services delivered.

B.

Ensuring that the vendor has complete management control of the outsourced process.

C.

Ensuring that there are means of monitoring the efficiency of the outsourced process.

D.

Ensuring that there are means of monitoring the effectiveness of the outsourced process.

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Exam Code: IIA-ACCA
Exam Name: ACCA CIA Challenge Exam
Last Update: May 1, 2024
Questions: 604
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