When Auditors Must Decide Which Type of Test to Select

question 17

Multiple Choice

When auditors must decide which type of test to select for obtaining sufficient appropriate evidence, the cost of obtaining the evidence is an important consideration. Rank the following types of tests in order of increasing cost: 1. Tests of controls
2) Substantive tests of transactions
3) Test of details of balances
4) Risk assessment procedures
5) Substantive analytical procedures

• A) 1, 2, 3, 4, and 5
• B) 2, 4, 3, 5, and 1
• C) 5, 4, 1, 2, and 3
• D) 5, 4, 3, 2, and 1

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Definitions:

Five Ws

The basic questions (Who, What, When, Where, Why) used to gather information and understand a story or situation fully.

Column Charts

A type of graph used in statistics and business to visually compare categories of data across vertical bars.

Line Chart

A type of graph that depicts information as a series of data points connected by straight line segments, often used to show trends over time.

Pictograph

A written symbol that represents an idea or object rather than a word, used in ancient writing systems and also in modern infographics.