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You have been asked to test the effectiveness of Ingo Corporation's control of manually approving all purchases over $25,000. During the year, Ingo Corporation has

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You have been asked to test the effectiveness of Ingo Corporation's control of manually approving all purchases over $25,000. During the year, Ingo Corporation has made 1,000,000 purchases, of which 3,000 were over $25,000. Jan Zhang, CPA, your supervisor asked you to use a tolerable deviation rate of 8 percent (although she expects the rate to be only approximately 0.25 percent) and a 5 percent risk of assessing control risk too low. Use the following to determine the planned assessed level of control risk and the assessed level of control risk (Planned) Assessed Level of Control Risk LOW Moderate Slightly below the maximum Maximum Tolerable Deviation Rate 2-2 6-12% 11-20% Over 20% a. What is the planned assessed level of control risk? Moderate Low Slightly below the maximum Maximum b. Determine the appropriate sample size and allowable number of deviations using Elgure 9.4 Hems Sample size Allowable number of deviations You have been asked to test the effectiveness of Ingo Corporation's control of manually approving all purchases over $25,000. During the year, Ingo Corporation has made 1,000,000 purchases, of which 3,000 were over $25,000. Jian Zhang, CPA, your supervisor asked you to use a tolerable deviation rate of 8 percent (although she expects the rate to be only approximately 0.25 percent) and a 5 percent risk of assessing control risk too low. Use the following to determine the planned assessed level of control risk and the assessed level of control.risk. Tolerable Deviation Mate 2-75 6-12% 11-20 Over 2013 Moderate Slightly below the maximum . What is the planned assessed level of control risk? Moderate Low Slightly below the maximum Maximum b. Determine the appropriate sample size and allowable number of deviations using Elgure 94 dems Sampe sue Allowable number of deviations b. Determine the appropriate sample size and allowable number of deviations using Eigure 9.4. items Sample size Allowable number of deviations c. Use Elgure 9.5 to determine the achieved upper deviation rate and the above table to determine the assessed level of control risk under the following circumstances. Assume that the sample size was 55 items. (Round your answers to 1 decimal place.) Circumstance Achieved Upper Deviation Rate Assessed Lovel of Control Risk No deviations were included in the sample One deviation is included in the sample Five deviations were included in the sample

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