Which of the Following Is Not True with Respect to the Risk

question 94

Multiple Choice

Which of the following is not true with respect to the risk of incorrect acceptance?

• A)It results in an efficiency loss to the auditor.
• B)It occurs when the auditor's sample indicates that the account balance is fairly stated.
• C)It occurs when the true misstatement in the account balance exceeds tolerable misstatement.
• D)The auditor can measure the exposure to this risk when using statistical sampling applications.

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Definitions:

Level Of Significance

The threshold beyond which the results of a statistical test are considered statistically significant.

P-value

The probability of obtaining test results at least as extreme as the results actually observed, under the assumption that the null hypothesis is true.

Test Statistic

A value calculated from sample data during a hypothesis test to determine whether to reject the null hypothesis.

Randomly Selects

The process of choosing individuals or items from a population in such a way that each has an equal chance of being chosen.