Chapter 9

Question 1

the uncertainty that results from sampling, the difference between the expected mean of the population and the tolerable deviation or misstatement

Answer 1

allowance for sampling risks

Question 2

the selection and evaluation of less than 100% of the population of audit relevance such that the auditor expects the items selected to be representative of the population.

Answer 2

audit sampling

Question 3

the use of normal distribution theory to estimate the dollar amount of misstatement for a class of transactions or an account balance

Answer 3

classical variables sampling

Question 4

a measure of sampling risk added and subtracted to the projected misstatement to form a confidence interval

Answer 4

confidence bound

Question 5

the amount 0f misstatement that the auditor believes exists in the population

Answer 5

expected misstatement

Question 6

detected misstatements about which there is no doubt

Answer 6

factual (or known) misstatement

Question 7

attribute-sampling techniques used to estimate the dollar amount of misstatement for a class of transactions or an account balance

Answer 7

monetary-unit sampling

Question 8

the risk that the auditor reaches an erroneous conclusion for any reason not related to sampling risks

Answer 8

non-sampling risks

Question 9

audit sampling the relies on the auditors judgement to determine the sample size, select the sample, and/or evaluate the results for the purpose of reaching a conclusion about the population

Answer 9

non-statistical sampling

Question 10

the extrapolation of sample results to the population

Answer 10

projected misstatements

Question 11

the risk that the sample supports the conclusion that recorded account balance is not materially misstated when it is materially misstated

Answer 11

risk of incorrect acceptance

Question 12

the risk that the sample supports the conclusion that the recorded account balance is materially misstated when it is not materially misstated

Answer 12

risk of incorrect rejection

Question 13

the possibility that the sample drawn is not representative of the population and that, as a result, the auditor reaches an incorrect conclusion about the account balance or class of transactions based on the sample

Answer 13

sampling risk

Question 14

the individual item constituting a population being sampled

Answer 14

sampling unit

Question 15

sampling that uses the laws of probability to select and evaluate the results of an audit sample, thereby permitting the auditor to quantify the sampling risk for the purpose of reaching a conclusion about the population

Answer 15

statistical sampling

Question 16

the amount of planning materially that is allocated to a financial statement account

Answer 16

tolerable misstatement

Question 17

the total of the projected misstatement plus the allowance for sampling risk

Answer 17

upper misstatement limit