The Procedures for Statistical Evaluation of Tests of Controls with the AICPA

question 30

Multiple Choice

The procedures for statistical evaluation of tests of controls with the AICPA Sample Evaluation Tables would not include the following step:

• A)Identify the population deviation rate.
• B)Identify the sample size in the left margin.
• C)Identify the number of actual deviations for the sample size.
• D)Identify the upper limit rate of deviation given the sample size and number of deviations.

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Definitions:

Processing Department

A specific unit within a manufacturing facility where a particular process or sequence of operations is carried out.

Weighted-Average Method

An inventory costing method that calculates the cost of goods sold and ending inventory based on an average cost of all goods available for sale.

Total Cost Transferred

The total amount of costs moved from one stage of production to the next, or from one department to another.

Processing Department

A division within a factory where a specific stage of production is completed, contributing to the transformation of raw materials into finished products.