According to AU-C 530, Audit Sampling, Statistical Sampling _______

question 116

Multiple Choice

According to AU-C 530, Audit Sampling, statistical sampling _______.

• A)should only be conducted for public companies
• B)is an approach to sampling that involves a random selection of sample items and the use of an appropriate statistical technique to determine sample size and evaluate sample results, including measurement of sampling risk
• C)is an approach to sampling that involves a random selection of sample items and the use of an appropriate non-statistical technique to determine sample size and evaluate sample results, including measurement of sampling risk
• D)should only be conducted for private companies

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Definitions:

Average Total Assets

A financial metric that represents the average value of all the assets owned by a company over a specific time period.

Operating Expenses

The costs associated with running a day-to-day business operation, excluding the cost of goods sold.

Residual Income

The income that remains after all personal debts and expenses have been paid, or in business, the net income after deducting cost of capital from operating profit.

Investment Center

A business segment within a company for which the manager has control and responsibility over cost, revenue, and investments.