Exam 9: Audit Sampling

Which of the following situations will result in the auditors concluding that the risk of material misstatement is too high when using nonstatistical sampling for substantive tests?

(Multiple Choice)

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Question 21

Which of the following types of risk is of critical importance to auditors in performing tests of controls?

(Multiple Choice)

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Question 22

An advantage of using statistical sampling techniques is that such techniques:

(Multiple Choice)

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Question 23

Auditors have a variety of sampling approaches available.For each approach in the first column,identify the correct statement in the second column.Each statement may be used once,more than once,or not at all. -Probability-proportional-to-size sampling.

(Multiple Choice)

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Question 24

When using a statistical sampling plan,the auditors would probably require a smaller sample if the:

(Multiple Choice)

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Question 25

The 3,000 accounts receivable of DEF Company have a total book value of $60,000.Bob Smith,CPA,has selected and audited a sample of 100 accounts with a total book value of $2,100.Using the difference estimation technique,Smith has properly estimated a projected misstatement of a $9,000 overstatement for the entire population.The estimated total audited value of the population is:

(Multiple Choice)

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Question 26

The mean book value of the items included in a mean-per-unit sample is not directly used in the evaluation of sample results.

(True/False)

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Question 27

Auditors have a variety of sampling approaches available.For each approach in the first column,identify the correct statement in the second column.Each statement may be used once,more than once,or not at all. -Attributes sampling.

(Multiple Choice)

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Question 28

The 1,000 accounts receivable of Baker Company have a total book value of $30,000 (Average book value = $30).Wendy Duffo,CPA,has selected and audited a sample of 50 accounts with the following mean values: 1.Book value of $29.00 2.Audited value of $29.50. -What is the estimated total audited value using mean-per-unit sampling?

(Multiple Choice)

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Question 29

In performing a test of a control last year the auditors specified a tolerable deviation rate of X percent.This year the auditors have specified a tolerable rate of less than X percent.Assuming that all other factors remain the same,which of the following is true regarding the relationship between this year's sample size compared to last year's sample size?

(Multiple Choice)

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Question 30

The 2,000 accounts receivable of ABC Company have a total book value of $40,000.Bob Rotter,CPA,has selected and audited a sample of 100 accounts with a total book value of $1,950.The audited value of the 100 accounts in the sample is $1,875. -Using the ratio estimation technique,Rotter's estimate (to the nearest dollar)of year-end accounts receivable balance would be:

(Multiple Choice)

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Question 31

When the auditors have chosen to test a control,what relationship will the tolerable rate normally have when compared to the expected rate of deviations in the sample?

(Multiple Choice)

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Question 32

The 1,000 accounts receivable of Baker Company have a total book value of $30,000 (Average book value = $30).Wendy Duffo,CPA,has selected and audited a sample of 50 accounts with the following mean values: 1.Book value of $29.00 2.Audited value of $29.50. -What is the estimated total audited value using difference estimation sampling?

(Multiple Choice)

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Question 33

Discovery sampling is equivalent to an attributes sampling plan with a very low deviation rate.

(True/False)

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Question 34

The 4,000 accounts receivable of Miller Company have a total book value of $150,000.A CPA has selected and audited a sample of 100 accounts with a total book value of $3,700 and an audited value of $3,800. -Using the mean-per-unit estimation technique,the estimated total audited value of the population is:

(Multiple Choice)

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Question 35

Assume a mean-per-unit estimation variables sampling application with a tolerable misstatement of $70,000 and a book value of $700,000.After performing the sampling plan,the auditors calculated an allowance for sampling risk of $45,000 and a point estimate of the population's total audited value to be $640,000.The projected misstatement based on this sample is:

(Multiple Choice)

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Question 36

Auditors have a variety of sampling approaches available.For each approach in the first column,identify the correct statement in the second column.Each statement may be used once,more than once,or not at all. -Ratio estimation sampling.

(Multiple Choice)

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Question 37

Decreases in the estimated standard deviation have what effect on required sample size?

(Multiple Choice)

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Question 38

Which of the following best illustrates the concept of sampling risk?

(Multiple Choice)

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Question 39

There are many kinds of statistical estimates that an auditor may find useful,but basically every statistical estimate in auditing is of either a quantity or of an error rate.The statistical terms that roughly correspond to "quantities" and "occurrence rate," respectively,are:

(Multiple Choice)

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Question 40

Showing 21 - 40 of 91

Which of the following situations will result in the auditors concluding that the risk of material misstatement is too high when using nonstatistical sampling for substantive tests?

Which of the following types of risk is of critical importance to auditors in performing tests of controls?

An advantage of using statistical sampling techniques is that such techniques:

Auditors have a variety of sampling approaches available.For each approach in the first column,identify the correct statement in the second column.Each statement may be used once,more than once,or not at all. -Probability-proportional-to-size sampling.

When using a statistical sampling plan,the auditors would probably require a smaller sample if the:

The mean book value of the items included in a mean-per-unit sample is not directly used in the evaluation of sample results.

Auditors have a variety of sampling approaches available.For each approach in the first column,identify the correct statement in the second column.Each statement may be used once,more than once,or not at all. -Attributes sampling.

When the auditors have chosen to test a control,what relationship will the tolerable rate normally have when compared to the expected rate of deviations in the sample?

Discovery sampling is equivalent to an attributes sampling plan with a very low deviation rate.

Auditors have a variety of sampling approaches available.For each approach in the first column,identify the correct statement in the second column.Each statement may be used once,more than once,or not at all. -Ratio estimation sampling.

Decreases in the estimated standard deviation have what effect on required sample size?

Which of the following best illustrates the concept of sampling risk?

There are many kinds of statistical estimates that an auditor may find useful,but basically every statistical estimate in auditing is of either a quantity or of an error rate.The statistical terms that roughly correspond to "quantities" and "occurrence rate," respectively,are:

The Role of the Public Accountant in the American Economy

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Legal Liability of Cpas

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Audit Planning, understanding the Client, assessing Risks, and Responding

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Consideration of Internal Control in an Information Technology Environment

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Accounts Receivable, notes Receivable, and Revenue

Inventories and Cost of Goods Sold

Property,plant,and Equipment: Depreciation and Depletion

Accounts Payable and Other Liabilities

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Auditors Reports

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