You Are Auditing Nelson and Company and Determined That the Sample

question 68

Multiple Choice

You are auditing Nelson and Company and determined that the sample results support a conclusion that the account is materially misstated, when in fact it was not misstated. This illustrates the risk of

• A) incorrect acceptance.
• B) incorrect rejection.
• C) control risk too low.
• D) control risk too high.

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Definitions:

Need for Power

A personality trait characterized by a desire to control or influence others, and a preference for being in leadership positions.

Need for Motivation

An internal force that propels individuals towards achieving their objectives, sustaining their effort in the face of obstacles.

Yerkes-Dodson Law

A theory suggesting there is an optimal level of arousal for performance, where too little or too much arousal can detrimentally affect task performance.

Levels of Arousal

Refers to the physiological and psychological state of being awake or reactive to stimuli.