Auditing Chapter 8 Pre Quiz

Question 1 of 10

1

Which of these questions would an auditor ask when sampling to perform tests of controls?

Select one of the following:

Which population and sampling unit should be tested, and what characteristics should be examined?
How many items should be selected for audit testing?
Which items should be included in the sample?
What inferences can be made about the overall population from the sample?
All of these

Explanation

Question 2 of 10

1

Refer to Exhibit 8.2 and determine which of the following phrases matches this definition:
The risk that the auditor will conclude that internal controls are effective when internal controls are actually not effective.

Select one of the following:

The risk of incorrect acceptance of internal control reliability.
The risk of incorrect acceptance of book value
The risk of incorrect rejection of internal control reliability
The risk of incorrect rejection of book value
None of these

Explanation

Question 3 of 10

1

Refer to Exhibit 8.4 and determine which of the following statements is true.

Select one of the following:

In nonstatistical sampling, sample size is determined by auditor judgment.
In statistical sampling, the sample must be randomly selected to give each unit in the population an equal chance to be included in the sample.
In nonstatistical sampling, evaluation is based on auditor judgment and projections are based on sample results.
In statistical sampling, the auditor is required to define acceptable risk in advance.
All of these are true

Explanation

Question 4 of 10

1

In attributes sampling, which of the following will not affect the determination of sample size?

Select one of the following:

The expected population deviation rate
Sampling risk
The tolerable rate of deviation
The risk of incorrect rejection of book value

Explanation

Question 5 of 10

1

Which of the following definitions is true?

Select one of the following:

Factual misstatement—A misstatement that has been specifically identified and about which there is no doubt.
Projected misstatement—The auditor's best estimate of the misstatement in a given population based on projecting the sample results to the population.
Tolerable misstatement—A monetary amount set by the auditor in respect of which the auditor seeks to obtain an appropriate level of assurance that the monetary amount set by the auditor is not exceeded by the actual misstatement in the population.
Expected misstatement—The level of misstatement that the auditor expects to detect.
All of these are true

Explanation

Question 6 of 10

1

Which of the following represents the calculation of the sampling interval?

Select one of the following:

Tolerable error × Risk of incorrect acceptance.
Sample size ÷ Population size.
Tolerable error ÷ Risk of incorrect acceptance.
Population size ÷ Sample size.

Explanation

Question 7 of 10

1

Sampling can be used for both tests of controls and substantive tests of account balances and assertions.

Select one of the following:

True
False

Explanation

Question 8 of 10

1

Block sampling involves selecting a sample that consists of contiguous population items, such as selecting transactions by day or week.

Select one of the following:

True
False

Explanation

Question 9 of 10

1

	Created by Kayla Harbaugh almost 4 years ago

Chapter 8 Pre Quiz

Auditing Chapter 8 Pre Quiz

Question 1 of 10

Which of these questions would an auditor ask when sampling to perform tests of controls?

Select one of the following:

Explanation

Question 2 of 10

Refer to Exhibit 8.2 and determine which of the following phrases matches this definition: The risk that the auditor will conclude that internal controls are effective when internal controls are actually not effective.

Select one of the following:

Explanation

Question 3 of 10

Refer to Exhibit 8.4 and determine which of the following statements is true.

Select one of the following:

Explanation

Question 4 of 10

In attributes sampling, which of the following will not affect the determination of sample size?

Select one of the following:

Explanation

Question 5 of 10

Which of the following definitions is true?

Select one of the following:

Explanation

Question 6 of 10

Which of the following represents the calculation of the sampling interval?

Select one of the following:

Explanation

Question 7 of 10

Sampling can be used for both tests of controls and substantive tests of account balances and assertions.

Select one of the following:

Explanation

Question 8 of 10

Block sampling involves selecting a sample that consists of contiguous population items, such as selecting transactions by day or week.

Select one of the following:

Explanation

Question 9 of 10

Top-stratum items are population items whose book values exceed the sampling interval and are therefore excluded from the sample.

Select one of the following:

Explanation

Question 10 of 10

Benford's Law helps predict frequency patterns of deviations of controls.

Select one of the following:

Explanation

Refer to Exhibit 8.2 and determine which of the following phrases matches this definition:
The risk that the auditor will conclude that internal controls are effective when internal controls are actually not effective.