One of the Causes of Nonsampling Risk Is

question 151

Multiple Choice

One of the causes of nonsampling risk is

• A) choosing the wrong sample size.
• B) effective audit procedures.
• C) inadequate sample size.
• D) failure to recognize exceptions.

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Definitions:

Direct Materials

Raw materials that are directly involved in the production of a product and can be easily traced to it.

Cost Pool

A collection of indirect costs grouped together based on similar cost drivers for the purpose of allocation to products, services, or departments.

Activity-Based Costing

A costing methodology that assigns costs to products and services based on the activities and resources that go into producing them.

Overhead Cost Per Unit

The indirect manufacturing costs allocated to each unit of product produced.