In the Audit of Account Balances,the Sample Size Will Tend

question 32

Multiple Choice

In the audit of account balances,the sample size will tend to be smaller when the ________.

• A)risk of incorrect acceptance is lower
• B)risk of incorrect rejection is lower
• C)tolerable misstatement is smaller
• D)population variability is smaller

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Definitions:

Income Statement

A financial statement that reports a company's financial performance over a specific accounting period, detailing revenues, expenses, and profits.

Inventory Value

The total cost or market value of all the goods held by a company intended for sale or used in production.

Prime Costs

The combined costs of direct materials and direct labor that are directly involved in the production of a product.

Factory Overhead

Costs related to the manufacturing process that are not directly attributable to the product being manufactured, such as utilities and maintenance of equipment.