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

A. The 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.

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

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

D. 50 percent of total organizational cost has been allocated on a volume basis.

Organizational activities that complement each other and create a competitive advantage are called a:

A. Merger.

B. Strategic fit.

C. Joint venture.

D. Strategic goal.

An organization produces two products, X and Y. The materials used for the production of both products are limited to 500 kilograms (kg) per month. All other resources are unlimited and their costs are fixed. Individual product details are as follows:

Product X Product Y Selling price per unit $10 $13 Materials per unit (at $1/kg) 2 kg 6 kg Monthly demand 100 units 120 units In order to maximize profit, how much of product Y should the organization produce each month?

A. 50 units.

B. 60 units.

C. 100 units.

D. 120 units.

Which of the following is true regarding the COSO enterprise risk management framework?

A. The framework categorizes an organization's objectives to distinct, non overlapping objectives.

B. Control environment is one of the framework's eight components.

C. The framework facilitates effective risk management, even if objectives have not been established.

D. The framework integrates with, but is not dependent upon, the corresponding internal control framework.

An organization recently documented its procedures for recovering systems and data after a disaster How are these documented procedures most likely to be used during a disaster simulation exercise?

A. To help property configure mass communication notification tools

B. To help identify training needs across the functional areas required to recover systems and data.

C. To help ensure that the team members who are required to recover systems and data understand their roles.

D. To help validate the contact information of key personnel required to recover systems and data

An organization has received funding to continue a program that utilizes an in-house Due to new legislative requirements the application will require additional features to capture information not previously collected Which of the following is the most critical for completing this specific project?

A. A detailed budget that identifies hardware resources for the project

B. A Gantt chart that identifies the critical path for completing the project

C. Change management controls to avoid technical conflicts within the application

D. A project plan with a flexible scope to accommodate legislative requirements

The balanced scorecard approach differs from traditional performance measurement approaches because it adds which of the following measures?

1) Financial measures 2) Internal business process measures. 3) Client satisfaction measures 4) Innovation and learning measures

A. 1 only.

B. 2 and 4 only.

C. 3 and 4 only.

D. 2, 3, and 4 only

Which of the following budgets serves as a basis for the budgeted income statement?

A. All financial budgets

B. All operating budgets

C. Only the cash budget and budgeted balance sheet

D. Only the sales and production budgets

An internal auditor observed that the organization's disaster recovery solution will make use of a code site in a town several miles away Which of the following is likely to be a characteristic of this disaster recovery solution?

A. Data is synchronized in real lime

B. Recovery time is expected to be less than one week

C. Servers are not available and need to be procured

D. Recovery resources and data restore processes have not been defined

An organization uses the management-by-objectives method, whereby employee performance is based on defined goals Which of the following statements is true regarding this approach?

A. It is particularly helpful to management when the organization is facing rapid change

B. It is a more successful approach when adopted by mechanistic organizations

C. It is more successful when goal-setting is performed not only by management, but by an team members, including lower-level staff.

D. It is particularly successful in environments that are prone to having poor employer- employee relations