ACCT444 Week 6 Quiz Latest 2017

ACCT444 Week 6 Quiz Latest 2017 PLEASE SEE THE LAST PAGE FOR ANSWER Question Question 1 3 / 3 pts (TCO 9) The exception rate the auditor will permit in the population and still be willing to reduce the assessed level of control risk is called the tolerable exception rate. estimated population exception rate. acceptable risk of overreliance. sample exception rate. Question 2 3 / 3 pts (TCO 9) A sample in which every possible combination of items in the population has an equal chance of constituting the sample is a random sample. statistical sample. judgment sample. representative sample. Question 3 3 / 3 pts (TCO 9) To determine if a sample is truly representative, an auditor must conduct multiple samples of the same population. never use sampling because of the expense involved. audit the entire population. perform none of the above. Question 4 3 / 3 pts (TCO 9) The most important aspect of evaluating the client's method of obtaining a reliable cutoff is to perform extensive detailed testing of cutoff. evaluate the client's control procedures around cutoff. confirm a sample of transactions near period end with customers. perform any of the above. Question 5 3 / 3 pts (TCO 9) The understatement of sales and accounts receivable is best uncovered by confirming receivables. reviewing the aged trial balance. test of transactions for shipments made but not recorded. reconciling the accounts receivable general ledger account with the schedule of accounts receivable. Question 6 3 / 3 pts (TCO 9) For most audits, inherent risk for accounts receivable is moderate or low except for which balance-related audit objectives? Timing and realizable value Completeness and existence Existence and accuracy Realizable value and cutoff Question 7 3 / 3 pts (TCO 9) An auditor should perform alternative procedures to substantiate the existence of accounts receivable when no reply to a positive confirmation request is received. no reply to a negative confirmation request is received. collectibility of receivables is in doubt. pledging of the receivables is probable. Question 8 3 / 3 pts (TCO 9) Which of the following does not have to be considered in determining the initial sample size of a test of details? Tolerable misstatement Acceptable risk of incorrect rejection Estimate of misstatements in the population Each of the above must be considered Question 9 3 / 3 pts (TCO 9) Sampling risk maybe controlled by reducing down the sample size. using only random sampling. using the sample technique most appropriate for the population. using audit software. Question 10 3 / 3 pts (TCO 9) The acceptable risk of incorrect acceptance is most related to audit efficiency. audit results. audit effectiveness. None of the above ANSWER 1. tolerable exception rate. 2. random sample. 3. audit the entire population. 4. evaluate the client's control procedures around cutoff. 5. test of transactions for shipments made but not recorded. 6. Realizable value and cutoff 7. no reply to a positive confirmation request is received. 8. Acceptable risk of incorrect rejection 9. using the sample technique most appropriate for the population. 10. audit effectiveness.