2) Which of the following is a red-flag in terms of traud detection? A)-The employee refuses to work on weekends B) The employee's spouse has lost a job C) The employee is late for work time to time D) Not possible to determine red-flags for fraud E) None 3) If confidence level is set to 99%, what will be the sampling risk? A) 10% B) 5% C) 1% D) 20% 4) In auditing inventory transactions, which of the following assertion requires tracing? A) Occurrence B) Completeness C) LIFO D) FIFO E) None 5) Some account balances are the result of complex calculations. The susceptibility to material misstatements in these types of accounts is defined as A) Audit risk B) Detection risk C) Sampling risk nherent risk E) None 6) Assume accounts payable is overstated by $15000 in previous year. In the current year, the account is overstated by $5000. What is the amount of misstatement? A) $25000 B) $5000 30000 D) No misstatement E) None 7) Assume inherent risk and control risks are assigned 50% and 40%, respectively. To keep audit risk at 9%, what must be the rate of detection risk? A2 =12x(x se B) 45% C) 25% A) 30% D) Cannot be calculated E) None DRLAR 8) In attribute sampling, if the sample size is 100 and you discovered 7 faulty items, what will be the population error rate? D) 7% E) None C) 4% A) 9% B) 6% 9) In monetary unit sampling for accounts receivable, assume book value is $10000 and sample size is 400. What is the sampling interval? E) None D) 25 B) 20 C) 40 A) 50 E) None