$1.$ An auditor intends to rely on a control to prevent and detect a material misstatement. How will this impact the tolerable error rate and sample size?

a$.$ there is no impact on sample size or tolerable error rate

b$.$ sample size will be increased, and a lower tolerable error rate will be set

c$.$ a higher tolerable error rate will be set, and sample size will be increased

d$.$ there is a negligible impact on sample size

$2.$ Which of the following scenarios illustrates the concept of sampling?

a$.$ the auditor tests all the purchases of machinery in the year

b$.$ the auditor chooses to send confirmations to six of the ten accounts receivable customers

c$.$ the auditor examines documentation for every disposal of equipment during the year

d$.$ the auditor verifies all balances within the cash balance

$3.$ If an auditor receives confirmation from the client$$s bank regarding the interest rates charged on amounts borrowed by the client, the auditor is gathering evidence related to the assertion of

a$.$ presentation.

b$.$ classification.

c$.$ completeness.

d$.$ Accuracy

$4.$ An auditor decides the control risk is high and therefore reduces the reliance on internal controls and increases the amount of substantive testing. This decision refers to the

a$.$ materiality of the audit.

b$.$ timing of the audit testing.

c$.$ nature of the audit testing.

d$.$ extent of the audit testing.

$5.$ An auditor increases their assessment of the risk of material misstatement. Which of the following is NOT accurate?

a$.$ inherent and control risk has been assessed as high

b$.$ there is a greater risk of a material misstatement in the financial statements

c$.$ an auditor will rely more on substantive testing

d$.$ substantive testing sample size will be decreased

$6.$ An auditor tests an account balance with a total of $$45,000.$ The auditor chooses a sample of $$34,500$ and discovers there are errors totalling $$1,546$ within this sample. What is the projected error for this account balance?

a$.$ $$1,546\mathrm{.}00$

b$.$ $$2,016\mathrm{.}52$

c$.$ $$10,500\mathrm{.}00$

d$.$ $$1,185\mathrm{.}27$

$7.$ An auditor performs testing on revenue and determines a material misstatement exists, when revenue is actually properly stated. What is the result of this conclusion?

a$.$ less extensive testing will be performed

b$.$ controls are determined to be ineffective

c$.$ audit efficiency is reduced

d$.$ increased non$-$sampling risk

$8.$ If an auditor inspects suppliers$$ invoices around year end to ensure that they are recorded in the correct period, the auditor is gathering evidence related to the assertion of

a$.$ classification.

b$.$ cut$-$off.

c$.$ accuracy.

d$.$ presentation.

$9.$ An auditor assessed their required confidence level as high. Which of the following is NOT accurate?

a$.$ substantive testing sample size will be decreased

b$.$ inherent and control risk has been assessed as high

c$.$ detection risk has been assessed as low

d$.$ an auditor requires more assurance from the results of their substantive testing

$10.$ An auditor uses their professional judgement to determine the tolerable rate of deviation when testing controls. Which of the following is accurate?

a$.$ if a higher tolerable rate of deviation is set, the sample size will be increased

b$.$ if a lower tolerable rate of deviation is set, the sample size will be increased

c$.$ there is no relationship between the tolerable rate of deviation and sample size

d$.$ if a lower tolerable rate of deviation is set, the sample size will be decreased