EBK AUDITING & ASSURANCE SERVICES: A SY
11th Edition
ISBN: 9781260687668
Author: Jr
Publisher: MCGRAW-HILL LEARNING SOLN.(CC)
expand_more
expand_more
format_list_bulleted
Question
Chapter 9, Problem 9.12MCQ
To determine
Concept Introduction:
Sampling is the method of selecting few items to check from the entire population under examination. Auditors apply sampling method while performing their
Sampling can be statistical or non statistical.
To choose: the case which will lead to a larger
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
A number of factors influences the sample size for a substantive test of details of an
account balance. All other factors being equal, which of the following would lead to a
larger sample size?
a. Smaller measure of tolerable misstatement.
b. Greater reliance on internal control.
c. Smaller expected frequency of errors.
O d. Greater reliance on analytical procedures.
.What is the effect on sample size for substantive procedures of an increase in the total error that the auditor is willing to accept
increase
decrease
negligible effect
no effect
Tolerable error, is the maximum monetary error that the auditor is prepared to accept in the population and still conclude that audit objective has been achieved, is directly related to
A.Sample size
BAudit risk
C.Materiality
D.Expected error
Chapter 9 Solutions
EBK AUDITING & ASSURANCE SERVICES: A SY
Ch. 9 - Prob. 9.1RQCh. 9 - Prob. 9.2RQCh. 9 - Prob. 9.3RQCh. 9 - Prob. 9.4RQCh. 9 - Prob. 9.5RQCh. 9 - Prob. 9.6RQCh. 9 - Prob. 9.7RQCh. 9 - Prob. 9.8RQCh. 9 - Prob. 9.9RQCh. 9 - Prob. 9.10RQ
Ch. 9 - Prob. 9.11MCQCh. 9 - Prob. 9.12MCQCh. 9 - Prob. 9.13MCQCh. 9 - Prob. 9.14MCQCh. 9 - Prob. 9.15MCQCh. 9 - Prob. 9.16MCQCh. 9 - Prob. 9.17MCQCh. 9 - Prob. 9.18MCQCh. 9 - Prob. 9.19MCQCh. 9 - Prob. 9.20MCQCh. 9 - Prob. 9.21PCh. 9 - Prob. 9.22PCh. 9 - Prob. 9.23PCh. 9 - Prob. 9.24PCh. 9 - Prob. 9.25PCh. 9 - Prob. 9.26P
Knowledge Booster
Similar questions
- The risks of incorrect acceptance in variables sampling and of overreliance in attributessampling both relate toa. Effectiveness of an audit.b. Efficiency of an audit.c. Control risk assessment decisions.d. Evidence about assertions in financial statements.arrow_forwardAn advantage of statistical sampling over nonstatistical sampling methods is that statistical methodsa. Afford more assurance than a nonstatistical sample of equal size.b. Provide an objective basis for quantitatively evaluating sampling risk.c. Can more easily convert the sample into a dual-purpose test useful for substantive procedures.d. Eliminate the need to use judgment in determining appropriate sample sizesarrow_forwardIn which of the following situations would an auditor most likely choose a substantive strategy and avoid sampling transactions to test controls? O The population size is large. O The expected deviation rate is less than the tolerable deviation rate. O The tolerable deviation rate is less than the expected deviation rate. O The revised materiality level is lower than the planned level.arrow_forward
- Which of the following statements about attribute sampling is correct? A. Larger transactions have a higher chance of being selected into the sample than smaller transactions. B. The risk of over-reliance does not affect the sample size. C. Attribute sampling is often used in the test of controls. D. The haphazard selection method is often used for attribute sampling. E. If the estimated population deviation rate is higher than the tolerable deviation rate, auditors conclude the internal control is effective.arrow_forwardWhen the computed upper exception rate is greater than the tolerable exception rate, it is necessary for the auditor to take specific action. Which of the following courses of action would be most difficult to justify? Reduce the tolerable exception rate so as to accept the sample results. Expand the sample size and perform more tests. Revise the assessed control risk. Write a letter to management which outlines the control deficiencies.arrow_forwardWhat is the effect on sample size for test of controls of an increase in the auditor's intended reliance on accounting and internal control systems. increase decrease negligible effect no effectarrow_forward
- The risk that the decision made based on the sample will differ from the decision madebased on the entire population is referred to asa. Audit risk.b. Examination risk.c. Sampling risk.d. Nonsampling riskarrow_forwardSubject: Auditing & Assurance Principles Define the following factors that affect the determination of sample size: a) Acceptable sampling risk b) Tolerable deviation rate c) Expected deviation rate d) Tolerable misstatement e) Expected misstatement f) Variation in the populationarrow_forwardWhat are the risks if the auditor concludes controls are operating effectively based on the sample and Control Risk is set too low?arrow_forward
- When evaluating the results of an MUS application, the audit team should compare the upper limit on misstatements to thea. Expected misstatement.b. Incremental allowance for sampling risk.c. Projected misstatement.d. Tolerable misstatement.arrow_forwardExplain how the following test of control will affect the sample size? a. An increase in the extent to which the auditor's risk assessment takes into account relevant controls b. An increase in the tolerable rate of deviation c. An increase in the expected rate of deviation of the population to be testedarrow_forwardWhich one of the sentences below is FALSE? A. The risk of incorrect acceptance called beta risk has the consequence that the auditor may assume that the population is free of material misstatement. B. The risk of incorrect rejection is called alpha risk and has the consequence that the auditor may assume on the basis of sample results that a population is materially misstated when, in fact, it is not . C. The risk of incorrect acceptance is called beta risk. D. The risk of incorrect rejection very common in audit sampling is called beta risk.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Auditing: A Risk Based-Approach (MindTap Course L...AccountingISBN:9781337619455Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:Cengage LearningAuditing: A Risk Based-Approach to Conducting a Q...AccountingISBN:9781305080577Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:South-Western College Pub
Auditing: A Risk Based-Approach (MindTap Course L...
Accounting
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Cengage Learning
Auditing: A Risk Based-Approach to Conducting a Q...
Accounting
ISBN:9781305080577
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:South-Western College Pub