Define Expected Rate of Deviation

question 40

Multiple Choice

Define expected rate of deviation.

• A)It is the rate at which the auditor expects controls to not function as planned.
• B)It is the maximum rate of deviation from a prescribed control that an auditor is willing to accept.
• C)It is the rate that represents the confidence that the evidence obtained is representative of the underlying population from which the sample was taken.
• D)It is similar to the actual rate of deviation in the population.

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Definitions:

Net Fixed Assets

The value of a company's property, plant, and equipment minus any accumulated depreciation, representing the actual value of the company's fixed assets.

Sales Increase

A rise in the volume or value of goods and services sold by a business over a given period.

Total Fixed Assets

The combined value of all long-term physical assets owned by a company, which are used in the production or supply of goods and services.

Operating Capacity

The maximum output that a company can produce and sell with the current resources and technology.