Factors Considered by an Auditor to Determine the Possibility That

question 113

Multiple Choice

Factors considered by an auditor to determine the possibility that the True population misstatement exceeds a tolerable amount in a nonstatistical sample include all of the following except for

• A)the extent to which items in the population have been audited 100%.
• B)the difference between the point estimate and acceptable control risk.
• C)whether misstatements tend to be offsetting or in only one direction.
• D)the amounts of individual misstatements.

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Definitions:

Owner's Equity

The residual interest in the assets of the entity after deducting liabilities, representing the ownership interest of the business owners.

Cash Withdrawals

The act of taking money out of an account, decreasing the account balance.

Assets

Resources owned or controlled by a company or individual with the expectation that they will provide future benefit.

Accounting Equation

A fundamental financial principle representing the relationship between a company's assets, liabilities, and shareholder's equity: Assets = Liabilities + Equity.