Which of the Following Courses of Action Would an Auditor

question 47

Multiple Choice

Which of the following courses of action would an auditor most likely follow in planning a sample of cash disbursements if the auditor is aware of several unusually large cash disbursements?

• A) Set the tolerable deviation rate at a lower level than originally planned.
• B) Identify the large and unusual disbursements as individually significant and test 100 percent.
• C) Increase the sample size to reduce the effect of the unusually large disbursements.
• D) Continue to draw new samples until all the unusually large disbursements appear in the sample.

---

Definitions:

Parallel Circuit

An electrical circuit in which components are connected so that the same voltage is applied to each component, but the total current is divided among the components.

Inductive Reactance

The opposition that an inductor presents to alternating current, due to its inductance, proportional to the frequency of the current.

Confederation Congress

The governing body of the United States under the Articles of Confederation, serving from 1781 to 1789, before the adoption of the Constitution.

Western Lands

Refers to the territories west of the Mississippi River in the United States, historically significant for expansion and settlement during the 19th century.