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Jackson CPA is examining the operating effectiveness of internal control related to the audit of Davidson, Inc. Jackson has set the following factors: Tolerable deviation
Jackson CPA is examining the operating effectiveness of internal control related to the audit of Davidson, Inc. Jackson has set the following factors: Tolerable deviation rate: 5% Expected Deviation Rate: 2% Risk of Assessing Control Risk Too Low: 5% 1. Determine the sample size 181 2. Assume instead that the actual sample size was 100 (this is not based on #1). If Jackson found 2 errors in the sample: What is the Upper Limit- 3. what would he conclude regarding the operating effectiveness of Davidson's internal controls numbers (i.e. write out the conclusion statement like we do in class). ? Support your answer using 4. What is the maximum number of deviations (as a whole number) that Jackson could identify without rejecting the sample Blank 1: 181 Blank 2: Blank 3: Blank 4: Jackson CPA is examining the operating effectiveness of internal control related to the audit of Davidson, Inc. Jackson has set the following factors: Tolerable deviation rate: 5% Expected Deviation Rate: 2% Risk of Assessing Control Risk Too Low: 5% 1. Determine the sample size 181 2. Assume instead that the actual sample size was 100 (this is not based on #1). If Jackson found 2 errors in the sample: What is the Upper Limit- 3. what would he conclude regarding the operating effectiveness of Davidson's internal controls numbers (i.e. write out the conclusion statement like we do in class). ? Support your answer using 4. What is the maximum number of deviations (as a whole number) that Jackson could identify without rejecting the sample Blank 1: 181 Blank 2: Blank 3: Blank 4
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