If the Projected Misstatement in a Nonstatistical Sampling Is $8,000,while

question 79

Multiple Choice

If the projected misstatement in a nonstatistical sampling is $8,000,while the tolerable misstatement is $9,000,what would an auditor likely conclude?

• A)Since the projected misstatement is less than the tolerable misstatement,the account is not misstated.
• B)Since the projected misstatement is less than the tolerable misstatement,the account is misstated.
• C)The risk is high that the account is materially misstated.
• D)The analysis has been improperly performed since the projected misstatement is unequal to the tolerable misstatement.

---

Definitions:

Production Manager

A professional responsible for overseeing the production process, ensuring efficiency, meeting production targets, and maintaining quality standards.

Purchasing Agent

An individual or company responsible for buying goods and services for another company or organization.

Fixed Overhead Volume Variance

Fixed overhead volume variance is the difference between the budgeted and actual volume of production, multiplied by the fixed overhead rate, indicating efficiency in production volume.

Predetermined Fixed Overhead Rate

A rate used to allocate fixed overhead costs to produced goods, based on estimated costs and activity levels.