When selecting a sample size for substantive tests of balances which factor, other factors being equal, would result in a larger sample? An increase in the tolerable misstatement An increase in the acceptable risk of incorrect acceptance Small expected misstatements A decrease in the tolerable misstatement
answer: A Decrease in tolerable misstatement
explanation
1. a decrease in tolerable misstatement would result in a larger sample , when selecting a sample size for substantial tests of balances.
2. the risk can be reduced by increasing the sample size
3.the risk of incorrect acceptance is called a beta risk
4. a decrease in tolerable misstatement would result in decreasing the sample size
When selecting a sample size for substantive tests of balances which factor, other factors being equal,...
Which of the following situations will result in the auditors concluding that the risk of material misstatement is too high when using non-statistical sampling for substantive tests? The projected misstatement exceeds the tolerable misstatement. The allowance for sampling risk exceeds the projected misstatement. The risk of incorrect acceptance exceeds the risk of incorrect rejection. The tolerable misstatement exceeds the sample net misstatement.
Which of the following does not have to be considered in determining the initial sample size of a test of details? Acceptable risk of incorrect rejection Acceptable audit risk Estimate of misstatements in the population Tolerable misstatement
Which of the following factors is least likely to influence the auditor’s determination of an appropriate sample size when testing the existence assertion for inventory? Group of answer choices Acceptable risk of incorrect acceptance Anticipated misstatement Tolerable misstatement Allowance for sampling risk Book value of the inventory account
Chapter 9 Audit Sampling 1.Three factors that determine the sample size are the risk of assessing control risk too high, tolerable deviation rate, and the expected population deviation rate. a. True b.False 2.While performing a substantive test of details during an audit, the auditor determined that the sample results supported the conclusion that the recorded account balance was materially misstated. It was, in fact, not materially misstated. This situation illustrates the risk of a. Incorrect rejection b. Incorrect acceptance c....
3. A financial audit is related to which economic factor of production? a. Allocation of financial capital b. Labor c. Land d. Manufacturing 4. Which of the following terms is associated with the auditing standard stating: In rare circumstances, the auditor may judge it necessary to depart fron a relevant presumptively mandatory requirement. In such circumstances, the auditor should perform alternative procedures to achieve the intent of the requirement. AU-C200.26 a. Can b. May d. Should c. Must 5....
Sandifer's
Accounting Service, Inc.
Trial Balance
For the year ended
12/31/19
Accounts
Debit
Credit
Cash
$ 156,500
Accounts Recieveable
116,650
Allowance for Doubtful Accounts
$ 51,250
Supplies
2,950
Prepaid Insurance
1,700
Building
260,000
Equipment
125,000
Land
111,500
Accumulated Depreciation
167,000
Investment in Bonds held to Maturity
24,000
Accounts Payable
5,650
Current Maturity of Note Payable
3,000
Note Payable
170,000
Unearned Revenue
2,000
Interest Payable
1,500
Salaries Payable...
(1) Other things being equal, which of the following will increase aggregate expenditures? Group of answer choices An increase in domestic prices relative to foreign prices A decrease in the interest rate A decrease in real wealth An increase in income taxes A decrease in government purchases of goods and services (2) If the current unemployment rate is 5 percent and the natural unemployment rate is 6 percent, then the economy is Group of answer choices producing a level of...
25 por QUESTION 4 Assuming that other factors are held constant, which of the following sets of data is most likely to produce a statistically significant value for the repeated measures t statistici n 15 and MD-2 On-15 and MD - 4 On - 30 and MD - 2 On - 30 and MD - 4 25 QUESTION 5 For which of the following situations would a repeated-measures research design be appropriate? comparing mathematical skills for girls versus boys at...
The limitations of an audit are NOT caused by ________. A. the nature of financial reporting. B. the nature of audit procedures. C. the need for the audit to be conducted within a reasonable period of time at a reasonable cost. D. a guarantee that the financial statements are free from error 2.5 points QUESTION 4 In an unqualified audit report on the financial statements of a public company, ACC562what does the first statement of the opinion paragraph state? A....
1. Which of the following matters would an auditor most likely consider to be a significant deficiency to be communicated to the audit committee? A. Management's failure to renegotiate unfavorable long-term purchase commitments.B. Recurring operating losses that may indicate going concern problems.C. Evidence of a lack of objectivity by those responsible for accounting decisions.D. Management's current plans to reduce its ownership equity in the entity. 2. After obtaining an understanding of internal control and arriving at a preliminary assessed level...