Non-Statistical Sampling May Be Better to Use Than Statistical Sampling

question 22

Multiple Choice

Non-statistical sampling may be better to use than statistical sampling when:

• A)The auditor has insufficient knowledge about the population to take a statistical sample.
• B)The inherent risk of error in the population is low.
• C)The population is known to be diverse, with a high inherent risk of error.
• D)Auditors are not technically proficient in sampling.

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Definitions:

Adjusted

The process of making modifications to financial statements or data to represent accurately the economic reality, often excluding one-time or non-recurring items.

Prepaid Rent

An asset account that represents rent payments made in advance of the rental period, which is then expensed during the period the space is occupied or used.

Rent Expense

The cost incurred by a company for leased property used in business operations over a specified period.

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life, representing the wear and tear, deterioration, or obsolescence of the asset.