Which of the Following Types of Sampling Applications Can Appropriately

question 9

Multiple Choice

Which of the following types of sampling applications can appropriately be used under generally accepted auditing standards?

• A)Statistical sampling: Yes; Nonstatistical sampling: Yes
• B)Statistical sampling: Yes; Nonstatistical sampling: No
• C)Statistical sampling: No; Nonstatistical sampling: Yes
• D)Statistical sampling: No; Nonstatistical sampling: No

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Definitions:

Historical Cost Principle

An accounting principle that requires financial statements to be based on the original cost of an asset, rather than its current market value.

Consistency Principle

An accounting principle that requires entities to apply the same accounting methods and policies from period to period unless a change is justified and disclosed.

Accounting Methods

The specific rules and procedures used by a business to prepare its financial statements, including how it recognizes revenue and expenses.

Revenue Recognition

Revenue recognition is an accounting principle that outlines the specific conditions under which revenue is recognized and dictates how to account for it.