Using Your Knowledge of the Relationships Among Acceptable Audit Risk

question 40

Short Answer

Using your knowledge of the relationships among acceptable audit risk, inherent risk, control risk, planned detection risk, performance materiality, and planned evidence, state the effect on planned evidence (increase or decrease) of changing each of the following factors, while the other factors remain unchanged.
1. an increase in acceptable audit risk ________
2. an increase in inherent risk ________
3. a decrease in control risk ________
4. an increase in planned detection risk ________
5. an increase in performance materiality ________

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Definitions:

Bananas

A tropical fruit that is elongated and crescent-shaped when ripe, commonly used in economics examples to discuss trade or market dynamics.

Quantity Demanded

The total amount of a good or service that consumers are willing to purchase at a given price over a specified period.

Consumers

Individuals or entities that use goods and services produced within an economy, playing a central role in market demand.

Price

Price is the amount of money expected, required, or given in payment for something.