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  1. Home
  2. IIA Certification
  3. IIA-CIA-Part3 Exam
  4. IIA.IIA-CIA-Part3.v2025-01-02.q249 Dumps
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Question 71

To calculate net sales, List Ac must be List Be cash receipts from customers.

Correct Answer: A
To convert from the cash basis cash receipts) to the accrual basis net sales the increase in net accounts receivable must be added to cash receipts from customers.
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Question 72

What are the possible characteristics of a client-server configuration in a current ERP system?
I. Thin clients, local area network, single server
II. Fat clients, wide area network, multiple servers
III.
Fat clients, connection via Internet, and single server

Correct Answer: A
Current ERP systems have a client-server configuration with possibly scores or hundreds of client user) computers. Clients may be thin or fat. So-called thin clients have little processing ability, but fat clients may have substantial processing power. The system may have multiple servers to run applications and contain databases. The network architecture may be in the form of a local area network LAN) or wide area network WAN), or users may connect with the sewer(s) via the Internet. An EPP system may use almost any of the available operating systems and database management systems.
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Question 73

Based on the Year 2 year-end balance of accounts receivable and the Year 2 income statement, the company had an average collection period for Year 2 of:

Correct Answer: C
The average collection period for Year 2 is 73 days [US $300,000 accounts receivable$1.500.000 sales - 365 days)].
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Question 74

Which of the following refers to taxes that do not necessarily take a larger absolute share of an increase in income?

Correct Answer: C
Regressive taxes are those for which the average tax rate falls as income rises. They take a smaller percentage of income as income rises, so they will not necessarily take a larger absolute amount of income as income rises.
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Question 75

A change in credit policy has caused an increase in sales, an increase in discounts taken, a decrease in the amount of bad debts, and a decrease in the investment in accounts
receivable. Based upon this information, the entity's:

Correct Answer: A
An increase in discounts taken accompanied by declines in receivables balances and doubtful accounts all indicate that collections on the increased sales have been accelerated. Accordingly, the average collection period must have declined. The average collection period is a ratio calculated by dividing the number of days in a year 365) by the receivable turnover Thus, the higher the turnover, the shorter the average collection period The turnover increases when either sales the numerator) increase, or receivables the denominator) decrease Accomplishing both higher sales and a lower receivables increases the turnover and results in a shorter collection on period.
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