Auditing And Assurance Services
17th Edition
ISBN: 9780134897431
Author: ARENS, Alvin A.
Publisher: PEARSON
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Question
Chapter 17, Problem 25DQP
a.
To determine
Compute the required
b.
To determine
State the affect on required sample size and use of this information in your sample size determination when instead of good results poor results were obtained for tests of controls and substantive procedures.
c.
To determine
State the selection of accounts for testing using the systematic selection.
d.
To determine
State whether the population is fairly stated.
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The auditor of Tent manufacturing Ltd has decided to use systematic selection of cash payments when testing the control that cheque payments are supported by a supplier’s invoice, a purchase requisition and a goods received note. Each cheque comprises a sampling unit. There are 4000 cheques drawn (numbered 1–4000) and the total amount of cash payments is $12 million. The sample size is 25 and the random start is 205. Given this information, the second item selected will be item no:Select one:a. Cheque number 2415.b. Cheque number 160.c. Cheque number 365.d. Some other item number.
An auditor is using PPS Sampling to determine the projected error in Accounts Receivable. Two errors were discovered:
Error #1: Book Value of $400, Audit Value of $100
Error #2: Book Value of $6,000, Audit Value of $2,000
The Sampling Interval was $2,000
Total Projected Error is:
a.
$2,100
b.
$2,833
c.
$4,300
d.
$2,300
e.
$5,500
The accounting department of the client reports that the balance of Accounts Receivable is $210,000.
Using classical variable sampling, the auditor computes an estimated total population value of $216,500
and computed a 95% achieved allowance for sampling risk of +- $8,500. The auditor should conclude
that the accounts receivable balance is fairly stated.
on
Select one:
O a. False
Ob. True
I
Chapter 17 Solutions
Auditing And Assurance Services
Ch. 17 - Prob. 1RQCh. 17 - Prob. 2RQCh. 17 - Prob. 3RQCh. 17 - Prob. 4RQCh. 17 - Prob. 5RQCh. 17 - Prob. 6RQCh. 17 - Prob. 7RQCh. 17 - Prob. 8RQCh. 17 - Prob. 9RQCh. 17 - Prob. 10RQ
Ch. 17 - Prob. 11RQCh. 17 - Prob. 12RQCh. 17 - Prob. 13RQCh. 17 - Prob. 14RQCh. 17 - Prob. 15RQCh. 17 - Prob. 16RQCh. 17 - Prob. 17RQCh. 17 - Prob. 18RQCh. 17 - Prob. 19RQCh. 17 - Prob. 20RQCh. 17 - Prob. 21.1MCQCh. 17 - Prob. 21.2MCQCh. 17 - Prob. 21.3MCQCh. 17 - Prob. 22.1MCQCh. 17 - Prob. 22.2MCQCh. 17 - Prob. 22.3MCQCh. 17 - Prob. 23.1MCQCh. 17 - Prob. 23.2MCQCh. 17 - Prob. 23.3MCQCh. 17 - Prob. 24.1MCQCh. 17 - Prob. 24.2MCQCh. 17 - Prob. 24.3MCQCh. 17 - Prob. 25DQPCh. 17 - Prob. 26DQPCh. 17 - Prob. 27DQPCh. 17 - Prob. 28DQPCh. 17 - Prob. 29DQPCh. 17 - Prob. 30DQPCh. 17 - Prob. 31DQPCh. 17 - Prob. 32DQPCh. 17 - Prob. 34DQPCh. 17 - Prob. 35DQP
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