Exam 10: Audit Sampling

In a sample-based audit of an account balance,which of the following combinations properly expresses the relationship between changes in the factors indicated and changes in sample size?

As a result of tests of controls,an auditor assessed control risk too low and decreased substantive testing.This assessment resulted because the true deviation rate in the population was ________.

After extrapolating the results of performing substantive tests on a sample of accounts from the accounts receivable subsidiary ledger,Allen CA concluded that the accounts receivable balance was materially misstated.In fact,the balance was materially correct.This situation illustrates the risk of ________.

The set of all of the elements that comprise an account balance or a class of transactions is referred to as a ________.

If statistical calculations were not applied,then a sampling method would be considered nonstatistical,even though a random sample was selected.

Assessing control risk too low threatens the efficiency of the audit but not the effectiveness.

The risk of incorrect rejection exists both in statistical and nonstatistical sampling.

In the audit of account balances,the sample size will tend to be smaller when the ________.

The total amount of monetary error that is found in a sample is referred to as the ________.

Green CA audited the inventory of ABC Company on a sample basis.Green audited a sample of 120 items and found a net overstatement of $600.The audited sample had a recorded value of $12,000.The entire inventory contained 2,400 items with a total book value of $280,000.The projected likely overstatement using the average difference method is ________.