An Auditor Is Preparing to Sample a Client's Customer Receivables

question 32

Multiple Choice

An auditor is preparing to sample a client's customer receivables for overstatement. A statistical sampling method that automatically provides stratification when using systematic selection (in that all items greater than the sample interval will be selected) is:

• A) ratio-estimation sampling.
• B) attribute sampling.
• C) mean-per-unit sampling.
• D) dollar-unit sampling.

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Definitions:

Price of a Resource

The monetary value assigned to a raw material, energy, or other fundamental inputs used in the production of goods and services.

Substitute Inputs

Alternatives that can be used in the production process if the original inputs become too expensive or unavailable.

Consumers

Individuals or groups who use goods and services to satisfy their personal needs and desires.

Unskilled Labor

Workforce with no special training or qualifications, often associated with manual or simple tasks.