DeVry ACCT444 Week 6 Quiz (2016) Score 100% 1

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    Question
    Question 1. Question :
    (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. Question :
    (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. Question :
    (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. Question :
    (TCO 9) Cutoff misstatements can occur for
    sales.
    sales returns and allowances.
    cash collections.
    any of the above.
    Question 5. Question :
    (TCO 9) Auditing standards require auditors to confirm accounts receivable with some exceptions. Which of the following is not one of the exceptions allowed by auditing standards?
    The accounts receivable balance is comprised of several very large customer balances.
    Accounts receivable are immaterial.
    Response rates are likely to be very low.
    The combined level of inherent risk and control risk are low and other substantive evidence can be obtained.
    Question 6. Question :
    (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. Question :
    (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. Question :
    (TCO 9) When auditors sample for tests of details of balances the objective is to determine
    whether the account balance being audited is fairly stated.
    whether the transactions being audited are free of misstatements.
    whether the controls being tested are operating effectively.
    whether the transactions and account balances being audited are fairly stated.
    Question 9. Question :
    (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. Question :
    (TCO 9) The acceptable risk of incorrect acceptance is most related to
    audit efficiency.
    audit results.
    audit effectiveness.
    None of the above
    Instructor Explanation: Page 561

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