use this information to answer the questions

Do Q2-i to Q2-iv

Q2 Q4 Instructions Case Facts Q1 Q3 Q2 & 3- Conclusion Audit Sampling Case Study-Air BNB Co. You are the experienced assistant auditor for the audit of Technology Inc. (the "Company), whose audit is subject to the standards of the AICPA. Your engag existence, valuation and allocation, and rights and obligations assertions of accounts receivable, specifically the risks of material misstatement that the clie that are not valid or are recorded at the incorrect amount. The total balance of accounts receivables is $1,118,517 rounded to $1,119,000. Your field senior h. confirming balances with individual customers, which is a common audit test to address these risks of material misstatement. As part of your risk assessment procedures, you obtained an understanding of the Company's accounting policy, processes, and controls regarding the acco management and process owners) and walkthroughs of the processes related to accounts receivable. As a result of these procedures, you understand that la high volume of low-dollar value transactions. You decide to use data analytics to obtain fact-based evidence and to corroborate your understanding of the one statistical outlier of $300K, while the remaining balance aggregated to $800K, which is made up of approximately 80 homogeneous transactions. Upon f a related-party transaction On the basis of your analysis of the accounts receivable balance, you define the customer balance as the sampling unit. You determine that any balances gr be selected for testing and therefore select the $300K related-party transaction as a judgemental selection. You then determine that you would use PPS stati The other relevant factors are as follows: Performance materiality (Tolerable Misstatement) is $258 thousand. Clearly trivial threshold (De Minimis Materiality) is $12.906. The population size, excluding the $300 thousand selected balance, is $819 thousand (no other items are above performance materiality) The Inherent level of risk is determined to be "Higher/High." You are relying on the operating effectiveness of internal controls and therefore Control Risk is determined to be Low. Combined Risk of Inherent and Control Risk (AKA Risk of Material Misstatement RMM") is determined to be Moderate. You determined that the "risk that other substantive procedures will fail to detect a material misstatement is moderate. The client provided the accounts receivable population to you in electronic format. Through the use of data analytics, you noted that the population had similar, positive value characters. Instructions Case Facts Q1 Q2 Q3 Q2 & 3- Conclusion Q4 "Company"), whose audit is subject to the standards of the AICPA. Your engagement team has identified risks of material misstatement related to the ccounts receivable, specifically the risks of material misstatement that the client has recorded in sales and accounts receivable for sales and shipments f accounts receivables is $1,118,517 rounded to $1,119,000. Your field senior has assigned you to test the accounts receivable balance by sampling and to address these risks of material misstatement of the Company's accounting policy, processes, and controls regarding the accounts receivable balance by performing procedures (including inquiries of to accounts receivable. As a result of these procedures, you understand that the accounts receivables balance is relatively homogeneous and consists of cs to obtain fact-based evidence and to corroborate your understanding of the accounts receivables balance. On the basis of your analysis, you identified OOK, which is made up of approximately 80 homogeneous transactions. Upon further inquiries about the $300K transaction above, you determined that it is the customer balance as the sampling unit. You determine that any balances greater than performance materiality (Tolerable misstaement) of $258K should n as a judgemental selection. You then determine that you would use PPS statistical sampling to test the remaining population. thousand (no other items are above performance materiality). ore Control Risk is determined to be Low. ment "RMM) is determined to be Moderate. tect a material misstatement is moderate. ormat positive value characters Q4 Instructions Case Facts Q1 Q2 Q3 Q2 & 3- Conclusion Question 2 (Remember to answer Q2- i to iv) ( You may need to scroll down to all the parts of the question.) Student #2 (Name): Determine the sample size using Non-Stat sampling: A. Calculate the sample size using Non-Stat Sampling Non-statistical use the formula per the PPT: Sample size - Population book value X Reliability factor Tolerable misstatement To determine the Sample Size fill out each item below & plug into the formula above: 102-1 Population book value (See facts in "Case Facts" tab): ANSWER: Q2-11 Tolerable misstatement (See facts in "Case Facts" tab): ANSWER: Q2-ili Reliability Factor (Use Figure 9.13 below & see the "Case Facets" tab): ANSWER: (Assume the "Risk that other substantive procedures fail to Detect a Material Misstatement" is Moderate, for the Combined Assessment of Inherent and Control Risk Se 102-1v Calculate the SAMPLE SIZE using the formula above: ANSWER: ELIPE FIGURE 9.13 Reliability Factors for Nonstatistical Sampling Plan Risk That Other Substantive Procedures (e.g., Analytical Procedures) Will Fail to Detect a Material Aka: RMM Misstatement Combined Assessment of Ala: No Aka: Some Aka: Many Inherent and Control other tests Other tests Other tests Risk Maximum Moderate Low Maximum 3.0 2.3 1.9 Slightly below maximum 2.7 2.0 1.6 Moderate 1.6 1.2 Low 1.0 1.2 1.0 Note: This tablo Happlicable when the auditors expect few misstatements in the population 23 Q2 Q4 Instructions Case Facts Q1 Q3 Q2 & 3- Conclusion Audit Sampling Case Study-Air BNB Co. You are the experienced assistant auditor for the audit of Technology Inc. (the "Company), whose audit is subject to the standards of the AICPA. Your engag existence, valuation and allocation, and rights and obligations assertions of accounts receivable, specifically the risks of material misstatement that the clie that are not valid or are recorded at the incorrect amount. The total balance of accounts receivables is $1,118,517 rounded to $1,119,000. Your field senior h. confirming balances with individual customers, which is a common audit test to address these risks of material misstatement. As part of your risk assessment procedures, you obtained an understanding of the Company's accounting policy, processes, and controls regarding the acco management and process owners) and walkthroughs of the processes related to accounts receivable. As a result of these procedures, you understand that la high volume of low-dollar value transactions. You decide to use data analytics to obtain fact-based evidence and to corroborate your understanding of the one statistical outlier of $300K, while the remaining balance aggregated to $800K, which is made up of approximately 80 homogeneous transactions. Upon f a related-party transaction On the basis of your analysis of the accounts receivable balance, you define the customer balance as the sampling unit. You determine that any balances gr be selected for testing and therefore select the $300K related-party transaction as a judgemental selection. You then determine that you would use PPS stati The other relevant factors are as follows: Performance materiality (Tolerable Misstatement) is $258 thousand. Clearly trivial threshold (De Minimis Materiality) is $12.906. The population size, excluding the $300 thousand selected balance, is $819 thousand (no other items are above performance materiality) The Inherent level of risk is determined to be "Higher/High." You are relying on the operating effectiveness of internal controls and therefore Control Risk is determined to be Low. Combined Risk of Inherent and Control Risk (AKA Risk of Material Misstatement RMM") is determined to be Moderate. You determined that the "risk that other substantive procedures will fail to detect a material misstatement is moderate. The client provided the accounts receivable population to you in electronic format. Through the use of data analytics, you noted that the population had similar, positive value characters. Instructions Case Facts Q1 Q2 Q3 Q2 & 3- Conclusion Q4 "Company"), whose audit is subject to the standards of the AICPA. Your engagement team has identified risks of material misstatement related to the ccounts receivable, specifically the risks of material misstatement that the client has recorded in sales and accounts receivable for sales and shipments f accounts receivables is $1,118,517 rounded to $1,119,000. Your field senior has assigned you to test the accounts receivable balance by sampling and to address these risks of material misstatement of the Company's accounting policy, processes, and controls regarding the accounts receivable balance by performing procedures (including inquiries of to accounts receivable. As a result of these procedures, you understand that the accounts receivables balance is relatively homogeneous and consists of cs to obtain fact-based evidence and to corroborate your understanding of the accounts receivables balance. On the basis of your analysis, you identified OOK, which is made up of approximately 80 homogeneous transactions. Upon further inquiries about the $300K transaction above, you determined that it is the customer balance as the sampling unit. You determine that any balances greater than performance materiality (Tolerable misstaement) of $258K should n as a judgemental selection. You then determine that you would use PPS statistical sampling to test the remaining population. thousand (no other items are above performance materiality). ore Control Risk is determined to be Low. ment "RMM) is determined to be Moderate. tect a material misstatement is moderate. ormat positive value characters Q4 Instructions Case Facts Q1 Q2 Q3 Q2 & 3- Conclusion Question 2 (Remember to answer Q2- i to iv) ( You may need to scroll down to all the parts of the question.) Student #2 (Name): Determine the sample size using Non-Stat sampling: A. Calculate the sample size using Non-Stat Sampling Non-statistical use the formula per the PPT: Sample size - Population book value X Reliability factor Tolerable misstatement To determine the Sample Size fill out each item below & plug into the formula above: 102-1 Population book value (See facts in "Case Facts" tab): ANSWER: Q2-11 Tolerable misstatement (See facts in "Case Facts" tab): ANSWER: Q2-ili Reliability Factor (Use Figure 9.13 below & see the "Case Facets" tab): ANSWER: (Assume the "Risk that other substantive procedures fail to Detect a Material Misstatement" is Moderate, for the Combined Assessment of Inherent and Control Risk Se 102-1v Calculate the SAMPLE SIZE using the formula above: ANSWER: ELIPE FIGURE 9.13 Reliability Factors for Nonstatistical Sampling Plan Risk That Other Substantive Procedures (e.g., Analytical Procedures) Will Fail to Detect a Material Aka: RMM Misstatement Combined Assessment of Ala: No Aka: Some Aka: Many Inherent and Control other tests Other tests Other tests Risk Maximum Moderate Low Maximum 3.0 2.3 1.9 Slightly below maximum 2.7 2.0 1.6 Moderate 1.6 1.2 Low 1.0 1.2 1.0 Note: This tablo Happlicable when the auditors expect few misstatements in the population 23