VSolo,CPA,performed a Nonstatistical Sampling Plan to Examine the Inventory Balances

question 55

Multiple Choice

V.Solo,CPA,performed a nonstatistical sampling plan to examine the inventory balances of Hope,Inc.In selecting the sample of 70 items,Solo used an expected misstatement of $40,000 and a tolerable misstatement of $65,000.The account balance consisted of 1,050 items totaling $1,200,000.The sample's recorded value was $80,000,and the audited value was $76,000.What conclusion did Solo draw regarding the account balance?

• A) To accept it because the estimated misstatement is less than the tolerable misstatement.
• B) To reject it because the estimated misstatement is more than the expected misstatement.
• C) To accept because the estimated misstatement is less than the expected misstatement.
• D) To reject because the estimated misstatement is more than the tolerable misstatement.

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