Problem 1 Tests of Controls The ABC Corporation requires that a department manager signs all purchase orders. The auditor took a sample of 250 purchase orders. The auditor allows for an error rate of 8% for the assessed level of control risk. The allowance for sampling risk is 2%. The following are the results of the sample taken: Purchase orders with a department manager signatures 240 Purchase orders without a department manager signature 10 A. What is the error rate of the test? B. Can the auditor rely on the controls over the authorization of purchase orders? C. What is the misstatement of purchases? D. How would the results of this test impact the planned substantive tests of 400 items? E. Is this test required by the AICPA