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Category: IIA-CIA-Part3

Exam IIA-CIA-Part3: Certified Internal Auditor – Part 3, Business Analysis and Information Technology

An organization has collected data on the complaints made by personal computer users and has categorized the c

An organization has collected data on the complaints made by personal computer users and has categorized the complaints. The chart displays the: A. Arithmetic mean of each computer complaint. B. Relative frequency of each computer complaint. C. Median of each computer complaint. D. Absolute frequency of each computer complaint. Explanation: This Pareto diagram depicts the […]

An organization has collected data on the complaints made by personal computer users and has categorized the c

An organization has collected data on the complaints made by personal computer users and has categorized the complaints. Using the information collected, the organization should focus on: A. The total number of personal computer complaints that occurred. B. The number of computer complaints associated with CD-ROM problems and new software usage. C. The number of […]

The cost of statistical quality control in a product quality cost system is categorized as a(n)

The cost of statistical quality control in a product quality cost system is categorized as a(n): A. Internal failure cost. B. Training cost. C. External failure cost. D. Appraisal cost. Explanation: The following are the four categories of quality costs: prevention, appraisal, internal failure, and external failure (lost opportunity). Appraisal costs include quality control programs, […]

A means of limiting production delays caused by equipment breakdown and repair is to

A means of limiting production delays caused by equipment breakdown and repair is to: A. Schedule production based on capacity planning. B. Plan maintenance activity based on an analysis of equipment repair work orders. C. Pre-authorize equipment maintenance and overtime pay. D. Establish a preventive maintenance program for all production equipment. Explanation: A preventive maintenance […]

Nevertheless, the differences between these organizations have certain implications for quality management

Quality costing is similar in service and manufacturing organizations. Nevertheless, the differences between these organizations have certain implications for quality management. Thus, A. Direct labor costs are usually a higher percentage of total costs in manufacturing organizations. B. External failure costs are relatively greater in service organizations. C. Quality improvements resulting in more efficient use […]

The company’s quality cost index is calculated using total cost of quality divided by sales dollars

Quality cost indices are often used to measure and analyze the cost of maintaining or improving the level of quality. Such indices are computed by dividing the total cost of quality over a given period by some measure of activity during that period (for example, sales dollars). The following cost data are available for a […]

Quality cost indices are often used to measure and analyze the cost of maintaining a given level of quality. O

Quality cost indices are often used to measure and analyze the cost of maintaining a given level of quality. One example of a quality cost index, which uses a direct labor base, is computed as: The following quality cost data were collected for May and June: Based upon these cost data, the quality cost index: […]

In Year 2, a manufacturing company instituted a total quality management (TQM) program producing the following

In Year 2, a manufacturing company instituted a total quality management (TQM) program producing the following report: On the basis of this report, which one of the following statements is most likely true? A. An increase in prevention and appraisal costs resulted in a higher quality product and therefore resulted in a decrease in failure […]

All of the following are generally included in a cost-of-quality report except

All of the following are generally included in a cost-of-quality report except: A. Warranty claims. B. Design engineering. C. Supplier evaluations. D. Lost contribution margin. Explanation: A cost-of-quality report includes most costs related to quality, specifically the costs of prevention, appraisal, internal failure, and external failure.

Listed below are selected line items from the cost-of-quality report for Company B for last month Category:

Listed below are selected line items from the cost-of-quality report for Company B for last month Category: What is Company B’s total prevention and appraisal cost for last month? A. US$786 B. US$1,154 C. US$1,940 D. US$2,665 Answer (C) is correct. Prevention costs are incurred to prevent defects from occurring. An example is equipment maintenance. […]


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