Which of the Following Most Likely Would Be an Advantage

question 29

Multiple Choice

Which of the following most likely would be an advantage in using classical variables sampling rather than monetary-unit sampling?

• A)An estimate of the standard deviation of the population's recorded amounts is not required.
• B)The auditor rarely needs the assistance of a computer program to design an efficient sample.
• C)Inclusion of zero and negative balances generally does not require special design considerations.
• D)Any amount that is individually significant is automatically identified and selected.

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Definitions:

Dividend Pricing Models

Financial models used to determine the value of a stock based on the dividends it is expected to yield, taking into account future dividends and the discount rate.

Intrinsic Value

The perceived or calculated true value of an asset, investment, or company, based on underlying characteristics and not market price.

Forecasted Cash Flows

Projected movements of cash in and out of a business, used for budgeting and financial planning.

Fixed Maturity

The predetermined date on which an investment, often a bond or other fixed-income security, matures and the principal is supposed to be repaid.