Chapter 15 Auditing Solutions

Topics: Sampling, Sample size, Sample Pages: 31 (6622 words) Published: August 28, 2012

Multiple-Choice Questions

easyA sample in which the characteristics of the sample are the same as those of the population is a(n): ba.variables sample.
b.representative sample.
c.attributes sample.
d.random sample.

easyWhen the auditor decides to select less than 100 percent of the population for testing, the auditor is said to use: aa.audit sampling.
b.representative sampling.
c.poor judgment.
d.none of the above.

3.In practice, auditors _________ know if a sample is truly a representative one. easya.sometimes

4.To determine if a sample is truly representative, an auditor must: easya.conduct multiple samples of the same population.
cb.never use sampling because of the expense involved.
c.audit the entire population.
d.perform none of the above.

5.One of the ways to eliminate nonsampling risk is through: easya.proper supervision and instruction of the client’s employees. bb.proper supervision and instruction of the audit team.
c.the use of attributes sampling rather than variables sampling.
d.controls which ensure that the sample drawn is random and representative.

6.One cause of nonsampling risk is:
easya.ineffective use of audit procedures.
ab.testing less than the entire population.
c.use of extensive tests of controls.
d.any of the above.

7.An auditor can increase the likelihood that a sample is representative by using care in: easya.designing the sampling process.
db.designing the sample selection.
c.evaluating the sample results.
d.performing all of the above.

easyWhen the auditor goes through a population and selects items for the sample without regard to their size, source, or other distinguishing characteristics, it is called: ba.block sample selection.

b.haphazard selection.
d.statistical selection.

9.When auditors wish to evaluate a sample statistically, the only acceptable selection method is: easya.probabilistic selection.
ab.judgmental selection.
c.haphazard selection.
d.block sample selection.

easyA sample in which every possible combination of items in the population has an equal chance of constituting the sample is a: aa.random sample.
b.statistical sample.
c.judgment sample.
d.representative sample.

easyThe process which requires the calculation of an interval and then selects the items based on the size of the interval is: ca.statistical sampling.
b.random sample selection.
c.systematic sample selection.
d.computerized sample selection.

12.________ is the risk that audit tests will not uncover existing exceptions in a sample. easya.Sampling risk.
bb.Nonsampling risk.
c.Audit risk.
d.Detection risk.

easy________ is the risk that an auditor will reach an incorrect conclusion because a sample is not representative of the population. aa.Sampling risk
b.Nonsampling risk
c.Audit risk
d.Detection risk

easyIn systematic sample selection, the population size is divided by the number of sample items desired in order to determine the: aa.sampling interval.
b.tolerable exception rate.
c.computed upper exceptions rate.

15.Sampling risk may be controlled by:
easya.adjusting the sample size.
db.always using random sampling .
c.using whatever sample selection technique is appropriate for the population.
d.both a and c.

16.Which of the following occurrences would be least likely to attract the auditor’s attention? easya.Deviations from client’s established control procedures. bb.Deviations from client’s budgeted values.

c.Monetary errors in populations of transaction data.
d.Monetary errors in populations of account balance details.

17.Which of the following statements is correct?
da.A sample of all items of a population will eliminate sampling...
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