Since estimates are not actual amounts and are used to approximate, there is not a need for the estimate to be fairly accurate. Group startsTrue or False

Q: tors are, the lower the quantitative thresholds will be. Thus, an item with a zero amount can be…

A: “Since you have posted a question with multiple sub-parts, we will solve first Four sub-parts for…

Q: Outline the weaknesses of sensitivity analysis

A: Sensitivity analysis uses in capital budgeting for measuring the risk in project. It helps in…

Q: Relevant financial information is: Select one: а. free from bias and error

A: solution concept Relevant financial information                 Relevance as a qualitative…

Q: A principal advantage of statistical methods of attribute sampling over nonstatistical methods is…

A: D. Sample Size

Q: For information to be relevant, it has to possess: Only predictive value Both predictive and…

A: Relevance is a Fundamental characteristic of useful Financial information. Relevant information can…

Q: Which of the following best describes the problem with the use of published industry averages for…

A: The review procedures that are usually performed at the conclusion of the audit are analytical…

Q: Standard deviation can be viewed as a measure of systematic and unsystematic risk combined True…

A: Standard deviation is the total risk of an asset or portfolio.

Q: state the effect on planned evidence (increase or decrease) of changing each of 'AN INCREASE IN…

A: A tolerable misstatement states the amount by which a financial statement line item can differ from…

Q: It is good to assume that unusual items will be zero. True or False

A: Unusual or Infrequent Items are transactions that are unusual in nature or infrequent. The items…

Q: For both tests of controls and substantive tests of details, non-sampling risk can be reduced by…

A: Solution Concept Sampling risk               Sampling refers to the examination of the sample from…

Q: The use of the word “prior” is a key indicator that information is nonrelevant to a current…

A: The use of the word "prior" is not a key indicator to know that information is non-relevant to a…

Q: Analytical Reports are reports that provide data or findings, analysis, and conclusion. Select one:…

A: The analytical report is the report that contains information along with necessary analysis,…

Q: Within our forecasting model we do not make "forecasting assumptions", but rather we make…

A: Introduction Forecasting is a technique of making estimates and predictions that are useful in…

Q: Which of the following is NOT a factor in the calculation of a FICO score?

A: FICO score FICO score is a credit score created by the Fair Isaac Corporation.

Q: Standard deviation and beta both measure risk, but they are different in that   beta measures both…

A: Systematic risk alludes to the hazard inherent in the whole economy or part of the market. It is…

Q: If the _______ is less than the _______, the audit team would conclude that the account balance is…

A: Misstatement: It can be defined as the variations between the actual financial statements being…

Q: High levels of assurance mean _______.     A. lower levels of non-sampling risk that the sample is…

A: High Level of Assurance: The greater the degree of assurance offered, the greater the amount of…

Q: Which one of the following is the main problem with using non-probability sampling technique? a. The…

A: Nonprobability sampling is a technique where the samples are selected without the random selection…

Q: Explain why the analysis of differences is important in the confirmation of accounts receivable,…

A: Every business sells goods on credit. The goods sold on credit are known as accounts receivable or…

Q: Which of the following is not one of the primary approaches that the auditors may use when…

A: Solution: following are the primary approaches that the auditors may use when evaluating the…

Q: Factors in a decision problem that cannot be expressed in numerical terms are: a. qualitative in…

A: Correct Answer is Option A i.e. qualitative in nature.

Q: Why is the reporting of segment information required? Justify your response. Why is the reporting of…

A: Segment reporting deals with in-detail segment-wise financial reporting in the financial statements…

Q: An auditor generally uses analytical procedures to obtain evidence regarding estimates. Question…

A: The given statement is true...

Q: The audit team will choose to reduce the reliance on controls if the _____ is greater than the…

A: The audit team will choose to reduce the reliance on controls if the upper limit rate of deviation…

Q: “Total input includes abnormal as well as normal spoilage and is, therefore, inappropriate as a…

A: Inventory shrinkage: It represents the loss of inventory. In other words, it refers to the…

Q: An essential step in difference estimation is the comparisonof each computed confidence limit with…

A: Tolerable misstatement indicates that part of overall materiality which is allocated to each of the…

Q: In testing for lower-of-cost-or-market, the auditor is gathering evidence to support which of the…

A: The audit is an examination of the financial statement of the company that helps to find the errors…

Q: Interpretation of reported information involves each of the following except limitations of reported…

A: Reported Information are those information which is available to all for general understanding or…

Q: Which of the following is not an advantage of non-statistical sampling? a) It allows an auditor to…

A: It requires less staff training is not a advantage of non statistical sampling.... In this sampling…

Q: Explain how and why changes in estimates are reported prospectively.

A: Accounting exchanges are those exchanges that legitimately influence the financial statements of a…

Q: Which of the following best describes the method of determining the ULRD?a. Expected population…

A: Upper Limit Rate of Deviation (ULRD): It is a statistical measure used by the audit team to adjust…

Q: Auditors often use a client's historical experience and subsequent transactions to evaluate the…

A: Auditors are responsible for the checking accounts and see that they are prepared with as per…

Q: The risks of incorrect acceptance in variables sampling and of overreliance in attributessampling…

A: Attributes sampling is a technique used to control the extent of particular attributes that exist…

Q: What is the difference in a data and findings?

A: Data is the combination of raw facts which is used for providing information and conclusions to the…

Q: When auditing estimates, auditors will propose adjusting entries for differences in judgment.…

A: Adjusting entries are the entries made at the end of the period to adjust the prepayments and the…

Q: The coefficient of variation is useful in determing the relative degree of variability of different…

A: In finance, the coefficient of variation is a statistical measure that is used for determining the…

Q: When NCREIF returns and REIT returns are compared, NCREIF returns exhibit a much lower pattern of…

A: Introduction: NCREIF is nothing but an acronym for National Council of Real Estate investment…

Q: Which of the following is false? a.    GAAP and IFRS have the same absolute standard regarding the…

A: International Financial Reporting Standard (IFRS): An international standard for identifying,…

Q: The results in using ratio analysis may be distorted if _? a. There is inflation. b. The data used…

A: The results of ratio analysis may be distorted due to changes in the values of any items which are…

Q: Which of the following components is not used in determining the upper limit on misstatements?a.…

A: Auditors generally uses Sampling Tools to find any error.