Which of the Following Activities Is Least Likely to Result

question 11

Multiple Choice

Which of the following activities is least likely to result in the audit team's exposure to sampling risk?

• A)Identifying all components of a client's accounts receivable balance.
• B)Determining the appropriate number of components of a client's accounts receivable balance for confirmation.
• C)Selecting components of a client's accounts receivable balance for confirmation.
• D)Evaluating confirmations returned from the client's customers and following up on any discrepancies noted by the customers.

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Definitions:

National Income Accounting

A system used by a country to measure the overall economic activity, including the total income earned by the nation and how it's used.

Net Capital Outflow

The difference between the purchase of foreign assets by domestic residents and the purchase of domestic assets by foreign residents over a specific period.

Purchasing-Power Parity

An economic theory that compares different countries' currencies through a "basket of goods" approach, arguing that exchange rates should equalize the price of the basket of goods in each country.

Price Level

An index that measures the average of current prices across a variety of goods and services compared to a base year.