The Auditor Using Nonstatistical Attributes Sampling,but Who Nevertheless Has Chosen

question 85

Multiple Choice

The auditor using nonstatistical attributes sampling,but who nevertheless has chosen the sample in conformity with random selection procedures:

• A)Need not consider the risk of assessing control risk too low.
• B)Has committed a nonsampling error.
• C)Will have to use discovery sampling techniques to evaluate the results.
• D)Should compare the deviation rate of the sample to the tolerable rate.

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Definitions:

Net 30 Credit Policy

A payment term that allows a customer 30 days to pay the full amount on an invoice without incurring interest or penalties.

Monthly Interest Rate

The interest rate applied to a loan or debt for each month, often used to calculate the interest expense on outstanding debt for the month.

Restocking Costs

The expenses associated with replenishing inventory once it has been sold to customers.

EOQ

Economic Order Quantity is a formula used in inventory management to determine the optimal order quantity that minimizes total inventory costs.