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VARIABLE SAMPLING PLAN: PROBABILITY-PROPORTIONAL-TO-SIZE SAMPLING In a PPS sampling plan with a sampling interval of P25,000 and a risk of incorrect acceptance of 20%, the

VARIABLE SAMPLING PLAN: PROBABILITY-PROPORTIONAL-TO-SIZE SAMPLING

In a PPS sampling plan with a sampling interval of P25,000 and a risk of incorrect acceptance of 20%, the following differences were observed from the test performed:

Book Value Audited Value

P55,000 P50,000

125,000 115,000

150,000 ` 120,000

Assume that the tolerable error acceptable to the auditor is P70,000 for this account balance being tested:

What is the total population projected error. Allowance for sampling risk. What will be the audit conclusion of the auditor?

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