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Company A is a retail business with numerous product lines. The company uses a perpetual inventory system. Inventory is located in one central warehouse and

Company A is a retail business with numerous product lines. The company uses a perpetual inventory system. Inventory is located in one central warehouse and three retail locations. You are assigned to test the inventory quantities for the year-end audit. Background Information: The inventory is valued at $2 million. There are 20,000 individual items in inventory. The auditor decides to use a confidence level of 95% and a tolerable error of 5%. Required: 1. Determine the Sampling Method: Choose between random, stratified, or haphazard sampling methods. 2. You sample 75 items from each product line (assuming 4 main product lines) and in your physical count they match the records for 294 items. Six items had discrepancies due to mislabeling, determine your error rate. 3. Evaluate your audit findings

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