For a Large Population of Cash Disbursement Transactions, Smith, CPA

question 11

Multiple Choice

For a large population of cash disbursement transactions, Smith, CPA is testing controls by using attribute sampling techniques. Anticipating an expected deviation rate of 3 percent, Smith found from a table that the required sample size is 400 with a tolerable deviation rate of 5 percent and a desired confidence level of 95 percent. If Smith anticipated an expected deviation rate of only 2 percent but wanted to maintain the same tolerable deviation rate and confidence level, the sample size would be closest to:

• A)200.
• B)400.
• C)533.
• D)800.

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Definitions:

Theoretical Approach

A systematic way of thinking about and analyzing a phenomenon, guided by a set of concepts and propositions.

Urban-Rural Differences

The varying characteristics, lifestyles, and social and economic conditions that distinguish urban areas from rural areas.

Structural Factors

Elements within a society or economy that influence how it functions, often related to institutions, social norms, and demographic trends.

Economic

Related to the production, distribution, and consumption of goods and services, and the analysis of the wealth of nations and individuals.