An Account Balance Is $300 000 and There Are 80

question 48

Multiple Choice

An account balance is $300 000 and there are 80 items in the account, six of which have balances that equal or exceed $15 000. The auditor plans to use a dollar-unit sampling plan with systematic sample selection. To ensure that all accounts with balances of at least $15 000 are selected, the sampling interval should be:

• A) 80.
• B) 6.
• C) 15 000.
• D) 12 000.

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Definitions:

Lessee

The entity that obtains the right to use an asset under a lease agreement from the lessor.

Uses the Asset

Refers to how an asset is employed within a business or investment strategy to generate returns or benefits.

Conditional Sales Agreement Lease

A financial arrangement where the lessee acquires an asset under a lease agreement but only becomes the owner upon full payment of the lease.

Secured Loan

A loan backed by collateral, reducing the risk for the lender and often resulting in a lower interest rate for the borrower.