Evaluating Sample Results: Nonstatistical Sampling. Finley Gunny is using nonstatistical sampling in the examination of Highway Company’s accounts receivable, which were recorded at $350,000. Gunny determined a tolerable misstatement of $15,000 and a sample size of 49 items.Required:a. How does Gunny determine sample size using nonstatistical sampling?b. If the items selected by Gunny had an aggregate recorded balance of $50,000 and an aggregate audited value of $45,000, calculate the estimated audited value.c. What would Gunny conclude with respect to the fairness of Highway’s accounts receivable?
Evaluating Sample Results: Nonstatistical Sampling. Finley Gunny is using nonstatistical sampling in the examination of Highway Company’s accounts receivable, which were recorded at $350,000. Gunny determined a tolerable misstatement of $15,000 and a sample size of 49 items.Required:a. How does Gunny determine sample size using nonstatistical sampling?b. If the items selected by Gunny had an aggregate recorded balance of $50,000 and an aggregate audited value of $45,000, calculate the estimated audited value.c. What would Gunny conclude with respect to the fairness of Highway’s accounts receivable?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Evaluating Sample Results: Nonstatistical Sampling. Finley Gunny is using nonstatistical sampling in the examination of Highway Company’s accounts receivable, which were recorded at $350,000. Gunny determined a tolerable misstatement of $15,000 and a
Required:
a. How does Gunny determine sample size using nonstatistical sampling?
b. If the items selected by Gunny had an aggregate recorded balance of $50,000 and an aggregate audited value of $45,000, calculate the estimated audited value.
c. What would Gunny conclude with respect to the fairness of Highway’s accounts receivable?
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