Why Might an Auditor Use Sampling

question 28

Multiple Choice

Why might an auditor use sampling?

• A) Because testing and entire accounting system is impractical and unnecessary.
• B) Because the client has not paid for full testing of the financial statements.
• C) The auditor deems that there is no fraud in a certain area of the business.
• D) The auditor deems that there is fraud in a certain area of a business.

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Definitions:

Interest Cost

The expense associated with borrowing funds, calculated as the rate of interest times the principal amount of the debt.