Identify the appropriate answer which is correct regarding tolerable misstatement.

Question

Want to see the full answer?

Answer 1

Question

Chapter 9, Problem 37HOQ

To determine

Identify the appropriate answer which is correct regarding tolerable misstatement.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Which one of the sentences below is FALSE? A. The risk of incorrect acceptance called beta risk has the consequence that the auditor may assume that the population is free of material misstatement. B. The risk of incorrect rejection is called alpha risk and has the consequence that the auditor may assume on the basis of sample results that a population is materially misstated when, in fact, it is not . C. The risk of incorrect acceptance is called beta risk. D. The risk of incorrect rejection very common in audit sampling is called beta risk.

Which of the following statements is not true with respect to the calculation of the upperlimit on misstatements?a. The tainting percentage is determined based on the difference between the recorded balance and the audited value.b. A separate incremental allowance for sampling risk is calculated for each misstatementdiscovered by the auditor.c. If no misstatements are detected, the basic allowance for sampling risk equals zero.d. The projected misstatement is determined by multiplying the sampling interval by thetainting percentage.

Which of the following statements is false? A) Top-stratum items are population items whose book value likely exceed the Sampling Interval and would be all selected for examination and evaluation during the audit. B) Because the auditor knows the full amount of errors in the top stratum (since all items are evaluated), no estimate of errors or projection to the population for the errors in the top stratum is required. C) The auditor's evaluation of the most likely misstatements in the sample reflects the sum of the misstatements from the top-stratum and the projected misstatement derived from the each lower-stratum items D) None of the above

Answer 2

Question

Chapter 9, Problem 37HOQ

To determine

Identify the appropriate answer which is correct regarding tolerable misstatement.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 9, Problem 37HOQ

To determine

Identify the appropriate answer which is correct regarding tolerable misstatement.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 9, Problem 37HOQ

To determine

Identify the appropriate answer which is correct regarding tolerable misstatement.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 9, Problem 37HOQ

To determine

Identify the appropriate answer which is correct regarding tolerable misstatement.

Answer 6

Chapter 9, Problem 37HOQ

To determine

Identify the appropriate answer which is correct regarding tolerable misstatement.

Answer 7

Chapter 9, Problem 37HOQ

To determine

Identify the appropriate answer which is correct regarding tolerable misstatement.

Answer 8

Expert Solution & Answer

Answer 9

Expert Solution & Answer

Answer 10

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 11

Ch. 9 - Prob. 1RQ Ch. 9 - Prob. 2RQ Ch. 9 - Prob. 3RQ Ch. 9 - Prob. 4RQ Ch. 9 - Prob. 5RQ Ch. 9 - Prob. 6RQ Ch. 9 - Prob. 7RQ Ch. 9 - Prob. 8RQ Ch. 9 - Prob. 9RQ Ch. 9 - Prob. 10RQ

Identify the appropriate answer which is correct regarding tolerable misstatement.

Solution Summary: The author explains that tolerable misstatement is directly related to materiality, while non-statistical sampling does not use statistical techniques for the evaluation of the sample.

Identify the appropriate answer which is correct regarding tolerable misstatement.

Want to see the full answer?

Chapter 9 Solutions