Question 21 (3 points)

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The auditor decided to use "systematic sampling" to select a sample of numerical shipping documents. He/she decided on a sample of 175 shipping documents (Bills of Lading) as the appropriate sample size to test for proper shipping authorization. The first number used in this fiscal year was 515 and the last number used this year was 3664. After randomly selecting the number 13 from within the interval, are the 1st, 3rd and 5th shipping document numbers selected for testing.

Question 21 options:

	527, 563, and 599
	515, 551, and 587
	516, 552, and 588
	528, 564, and 600

Question 22 (2 points)

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What is Sampling Risk?

Question 22 options:

	Risk of misinterpreting the results of the sample due to time and resource constraints.
	Risk of reaching an incorrect conclusion due to use of inadequate procedures.
	Risk of reaching an incorrect conclusion due to the inexperience of some auditors on the audit team.
	Risk of reaching an incorrect conclusion due to sample not being representative of the population.

Question 23 (2 points)

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How can the auditor reduce sampling risk:

Question 23 options:

	Confirm that the population is complete.
	Ask management to confirm that the sample is correct.
	Decrease the size of the sample.
	Increase the size of the sample.

Question 24 (2 points)

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What attribute is being tested in the following procedure?

"Select 50 invoices over $25,000 and check to see if the credit manager has approved the shipment by initialling the invoice." (2 marks)

Question 24 options:

	The value of the invoice.
	The credit manager him/herself.
	The 50 invoices.
	Credit manager's initials on the invoice.

Question 25 (2 points)

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Typically, what accounts receivable customer(s) does the auditor send a positive confirmation to?

Question 25 options:

	Large volume of customers with small balances.
	Customers with immaterial balances.
	Customers with large balances.
	Large customers with small balances.

Question 26 (2 points)

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Typically, what accounts receivable customer(s) does the auditor send a negative confirmation to?

Question 26 options:

	Customers designated as related parties.
	Large volume of customers with small balances.
	Customers with balances that extend past 90-days overdue.
	Large volume of customers with large balances.