Free BEC CPA Questions and Answers

Question 1

Which of the below is NOT a typical tactic for a company in a market that is only competitive?

Accepted Answer

Development of a brand name.

Answer

End-user computing refers to situations where non-IT professionals directly use and often develop computer applications. Personal computers (PCs) are designed for individual use and provide the accessibility and software tools (like spreadsheets and word processors) that empower end-users to manage their own data and tasks without extensive IT support, making them ideal for this purpose.

Question 2

Which of the these types of computers is most probably to be used for end-user computing?

Accepted Answer

Personal computers.

Answer

A check digit is a calculated digit appended to a number, used to detect errors during data entry. 'Check digit verification' recalculates this digit upon entry and compares it to the stored one. This control is specifically designed to catch transcription errors, such as entering a similar but incorrect product code (Z96015 instead of Z96014), making it the most effective control for this mistake.

Question 3

A consumer wanted to order 100 units of item Z96014, but placed an improper order for product Z96015,
which did not exist.Which of the following controls is the most likely to catch this mistake?

Accepted Answer

Check digit verification.

Answer

Enterprise Risk Management (ERM) aims to identify, assess, and manage risks to achieve organizational objectives, leading to benefits like improved capital deployment, enhanced risk response, and seizing opportunities. While ERM involves various risk responses, including sharing, its primary goal is comprehensive risk management, not to 'insure that the organization shares all major risks,' as sharing is just one potential strategy among many.

Question 4

Jar Corporation is thinking about putting in operation a risk management system for the company.
Which of the following benefits of enterprise risk management is not one of them?

Accepted Answer

Insures that the organization shares all major risks.

Answer

Credit risk in the context of derivatives refers to the possibility that the counterparty to the derivative contract will default on its obligations. If the counterparty fails to perform, the derivative may become ineffective or worthless, thereby failing to successfully hedge the specific asset it was intended to protect. Thus, the inability of the derivative to fulfill its hedging purpose can be a direct consequence of credit risk.

Question 5

Which of the below risks is associated with the potential that a derivative may not be successful in hedging a specific asset?

Accepted Answer

Credit risk.

Answer

Credit risk is not associated with the potential that a derivative may not be successful in hedging a specific asset. Credit risk is the risk that the counterparty to a derivative contract will default on its obligations.
The risk associated with the potential that a derivative may not be successful in hedging a specific asset is basis risk. Basis risk is the risk that the price of the derivative will not move perfectly in line with the price of the underlying asset.
For example, a company may use a futures contract to hedge the price of a commodity that it sells. If the price of the commodity falls, the company will lose money on its sales.
However, if the price of the futures contract does not fall as much as the price of the commodity, the company will not be fully hedged and will still lose money.

BEC - Business Environment and Concepts Practice Test

BEC - Business Environment and Concepts Practice Test

Free BEC CPA Questions and Answers