Consider the data from the previous problem. For each of the sampling methods named: a. Compute the
Question:
Consider the data from the previous problem. For each of the sampling methods named:
a. Compute the total amount of the transactions sampled and the proportion of the cumulative total the sample represents.
b. Discuss the advantages and risks of each sampling method assuming that it would be applied to the entire accounts payable ledger.
c. Suggest and defend an optimal combination of methods for the audit sample in this case.
Problem 16.2
You have been assigned to audit the accounts payable of Slamtastic, a small recording company specializing in alternative music. Following is a portion of their accounts payable journal for the month of December:
Generate a sample of eight transactions under the following sampling methods using the random number table from Figure 16-2 when necessary:
Figure 16-2
Step by Step Answer:
Auditing Assurance And Risk
ISBN: 9780324313185
3rd Edition
Authors: W. Robert Knechel, Steve Salterio, Brian Ballou