Scribd
Upload
15 views

ACC-138-Exercise-on-Audit-Sampling

The document is an exercise for an accounting course, specifically focused on auditing and sampling techniques. It contains multiple-choice questions that assess knowledge on topics such as PPS sampling, evaluation of audit results, statistical sampling, and errors in sampling. The exercise is designed for students to demonstrate their understanding of key auditing concepts and principles.

Uploaded by

Kyla Marie Doroni
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
15 views

ACC-138-Exercise-on-Audit-Sampling

The document is an exercise for an accounting course, specifically focused on auditing and sampling techniques. It contains multiple-choice questions that assess knowledge on topics such as PPS sampling, evaluation of audit results, statistical sampling, and errors in sampling. The exercise is designed for students to demonstrate their understanding of key auditing concepts and principles.

Uploaded by

Kyla Marie Doroni
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 2

MMSU – CBEA ACC 138 – BS ACC 3 Exercise

Name: _____________________________________ Section: __ Date: 4/24/2025 Score: _________


Choose the best answer. Write the letter of your choice at the left side of each number. Use capital letters
only.
1. PPS sampling is most appropriate when the auditor
A. Anticipates understatement errors. C. Expect no errors.
B. Anticipates overstatement errors. D. Has assessed control risk as HIGH.

2. The final step in the evaluation of audit results in substantive tests is the decision to:
A. Accept the population as fairly stated or to require further action.
B. Determine sampling error and total population error.
C. Project the point estimate.
D. Determine the error in each sample.

3. How would increases in tolerable misstatement and assessed level of control risk affect the sample size in a
substantive test of details?
A. Increase, increase, respectively. C. Decrease, increase, respectively.
B. Increase, decrease, respectively. D. Decrease, decrease, respectively.

4. In applying variables sampling, an auditor attempts to:


A. Estimate a qualitative characteristic of interest.
B. Determine various rates of occurrence for specified attributes.
C. Discover at least one instance of a critical deviation.
D. Predict a monetary population value within a range of precision.

5. The final step in the evaluation of audit results in tests of controls is the decision to:
A. Determine the error in each sample.
B. Determine sampling error and the total population error.
C. Project the point estimate.
D. Conclude whether the control tested is effective or is not effective.

6. The sample deviation rate equals


A. The number of deviation in the population divided by the sample size.
B. The number of items in the population multiplied by the number of deviations in the sample.
C. The number of deviations in the sample divided by the sample size.
D. The number of deviations in the population divided by the population size.

7. Which of the following explanations best describe the distinguishing feature of statistical sampling?
A. It provides for measuring mathematically the degree of uncertainty that results from examining only a part
of the data.
B. It allows the auditor to have the same degree of confidence as with judgment sampling but with
substantially less work.
C. It allows the auditor to substitute sampling techniques for audit judgment.
D. It provides for measuring the actual misstatements in financial statements in terms of reliability and
precision.

8. Statistical sampling do not allow:


A. More efficient samples. C. Replacement of the auditor’s judgment.
B. Measurement of sample reliability. D. Measurement of sample risk.

9. An error that arises from an isolated event that has not recurred other than on specifically identifiable
occasions and is therefore not representative of errors in the population is called:
A. Sampling error. C. Anomalous error.
B. Non-sampling error. D. Projected error.

10. One of the causes of non-sampling error is


A. Failure to draw a random sample.
B. Failure to draw a representative sample.
C. The use of attributes sampling instead of variables sampling.
D. The use of inappropriate or ineffective audit procedures.
11. 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, infact not
materially misstated. This situation illustrates the risk of
A. Incorrect acceptance C. Assessing control risk too low
B. Incorrect rejection D. Assessing control risk too high

12. The process which requires the calculation of an interval and then selects the items based on the size of the
interval is
A. Statistical sampling C. Sequential selection
B. Random selection D. Systematic selection

13. When selecting a stratified sample, the sample size is


A. Always larger than if unstratified sampling has been used.
B. Determined for the unstratified population and then apportioned to each stratum.
C. Determined for each stratum and selected from that stratum.
D. Determined for each stratum and selected randomly from the entire unstratified population.

14. Statistical sampling may be applied to test controls when a client’s control procedures
A. Enable the detection of fraud.
B. Depend primarily on segregation of duties.
C. Leave an audit trail as evidence of compliance.
D. Are carefully reduced to writing and are included in client accounting manuals.

15. Which of the following best describes what the auditor means by the rate of occurrence in the attribute
sampling plan?
A. The peso range within which the true population total can be expected to fall.
B. The acceptable risk that the sample is not representative of the population.
C. The frequency with which a certain characteristic occurs within a population.
D. The number of errors that can be reasonably expected to be found in a population.

16. S1: Tests performed on 100% or less than 100% of the items within a population involve sampling.
S2: The auditor will require a larger sample size if he expects an error in the population.
A. True; True B. True; False C. False; True D. False; False

17. S1: Non-statistical sampling can also use statistical formulas and techniques aside from the auditor’s
judgment.
S2: The risk of overreliance and the risk of incorrect rejection affect audit effectiveness and are more likely to
lead to an erroneous opinion on the financial statements.
A. True; True B. True; False C. False; True D. False; False

18. S1: Smaller sample sizes are justified when the population is expected to be error free.
S2: In substantive procedures, the tolerable error is the maximum rate of deviation from a prescribed control
procedure that the auditor would be willing to accept based on the prelimzinary assessment of control risk.
A. True; True B. True; False C. False; True D. False; False

19. Which of the following statements is correct?


A. Generally, the population size does not affect sample size.
B. The expected population deviation rate has no effect on sample size.
C. The population affects sample size.
D. For a given tolerable rate, a larger sample size should be selected as the expected population deviation
rate decreases.

20. Which of the factors below are factors considered by an auditor when planning an attribute sample from a
large number of invoices, intends to estimate the actual rate of deviations?
A. Audit objective C. Sampling objective
B. Expected deviations D. Population variance

“Do not settle for less. Always aim for the best but study and pray the hardest”
--- Reginald

You might also like

pFad - Phonifier reborn

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


Alternative Proxies:

Alternative Proxy

pFad Proxy

pFad v3 Proxy

pFad v4 Proxy