Edwards has decided to use monetary-unit sampling in the audit of an entitys accounts receivable balance. Few, if any, misstatements of account balance overstatement are expected.

Required:

Select the statements that are true regarding the differences between monetary-unit sampling and classical variable sampling.

1. Classical variable sampling is generally easier to use than monetary-unit sampling. (CORRECT/NON-CORRECT)

2. The calculation of sample size in a monetary-unit sample is based on an estimate of the standard deviation in the population. (CORRECT/NON-CORRECT)

3. If no misstatements are expected, classical variable sampling will usually result in a smaller sample size than monetary-unit sampling. (COORECT/NON-CORRECT)